SER WVU Hospitals, Inc. and WV United Health System v. Honorable Phillip D. Gaujot , 829 S.E.2d 54 ( 2019 )

IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
January 2019 Term FILED
_______________
June 5, 2019
released at 3:00 p.m.
No. 18-0841 EDYTHE NASH GAISER, CLERK
SUPREME COURT OF APPEALS
_______________ OF WEST VIRGINIA
STATE OF WEST VIRGINIA ex rel. WEST VIRGINIA UNIVERSITY
HOSPITALS, INC., AND WEST VIRGINIA UNITED HEALTH SYSTEM, INC.,
Petitioners
v.
THE HONORABLE PHILLIP D. GAUJOT, JUDGE OF THE CIRCUIT COURT
OF MONONGALIA COUNTY, CHRISTOPHER THOMACK, AND JOSEPH
MICHAEL JENKINS,
Respondents
____________________________________________________________
ORIGINAL PROCEEDING IN PROHIBITION
WRIT GRANTED AS MOULDED
____________________________________________________________
Submitted: February 5, 2019
Filed: June 5, 2019
Marc E. Williams, Esq. David E. Goddard, Esq.
Alexander L. Turner, Esq. Edmund L. Wagoner, Esq.
Christopher D. Smith, Esq. Goddard & Wagoner
Nelson Mullins Riley & Scarborough Clarksburg, West Virginia
LLP
Huntington, West Virginia Christopher J. Regan, Esq.
Laura P. Pollard, Esq.
Christine S. Vaglienti, Esq. Bordas & Bordas PLLC
West Virginia University Hospitals, Inc. Wheeling, West Virginia
Morgantown, West Virginia
David J. Romano, Esq.
Counsel for the Petitioners Jennifer L. Finch, Esq.
Romano Law Offices
Clarksburg, West Virginia
Counsel for Christopher Thomack and
Joseph Michael Jenkins, on their own
behalf and on behalf of all similarly
situated persons consisting of a class of
aggrieved persons
JUSTICE ARMSTEAD delivered the Opinion of the Court.
CHIEF JUSTICE WALKER, deeming herself disqualified, did not participate.
JUSTICE WORKMAN, deeming herself disqualified, did not participate.
JUDGE REEDER, sitting by temporary assignment.
JUDGE REGER, sitting by temporary assignment.
SYLLABUS BY THE COURT
1. “A class action may only be certified if the trial court is satisfied, after
a thorough analysis, that the prerequisites of Rule 23(a) of the West Virginia Rules of Civil
Procedure have been satisfied.” Syl. Pt. 8 (in part), State ex rel. Chemtall Inc. v. Madden,
216 W. Va. 443, 607 S.E.2d 772 (2004) (italics added).
2. For purposes of Rule 23(a)(2) of the West Virginia Rules of Civil
Procedure [2017], “a ‘question’ ‘common to the class’ must be a dispute, either of fact or
of law, the resolution of which will advance the determination of the class members’
claims.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 369, 131 S. Ct. 2541, 2562, 180 L.
Ed. 2d 374 (2011) (Ginsburg concurring in part and dissenting in part) (emphasis added).
3. For commonality to exist under Rule 23(a)(2) of the West Virginia
Rules of Civil Procedure [2017], class members’ “claims must depend upon a common
contention[,]” and that contention “must be of such a nature that it is capable of classwide
resolution[.]” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350, 131 S. Ct. 2541, 2551,
180 L. Ed. 2d 374 (2011). In other words, the issue of law (or fact) in question must be
one whose “determination . . . will resolve an issue that is central to the validity of each
one of the claims in one stroke.” Id. (emphasis added).
i
4. “When a circuit court is evaluating a motion for class certification
under Rule 23 of the West Virginia Rules of Civil Procedure [1998], the dispositive
question is not whether the plaintiff has stated a cause of action or will prevail on the merits,
but rather whether the requirements of Rule 23 have been met.” Syl. Pt. 7, In re W. Va.
Rezulin Litig., 214 W. Va. 52, 585 S.E.2d 52 (2003).
5. Determining whether the requirements of Rule 23 of the West Virginia
Rules of Civil Procedure [2017] have been met often involves, by necessity, some
“coincidental” consideration of the merits. Gariety v. Grant Thornton, LLP, 368 F.3d 356,
366 (4th Cir. 2004).
6. “[C]lass determination generally involves considerations that are
enmeshed in the factual and legal issues comprising the plaintiff[]s[’] cause of action.”
Comcast Corp. v. Behrend, 569 U.S. 27, 34, 133 S. Ct. 1426, 1432, 185 L. Ed. 2d 515
(2013) (cleaned up).
7. “Merits questions may be considered to the extent—but only to the
extent—that they are relevant to determining whether the Rule 23 prerequisites for class
certification are satisfied.” Amgen Inc. v. Connecticut Ret. Plans & Tr. Funds, 568 U.S.
455, 466, 133 S. Ct. 1184, 1195, 185 L. Ed. 2d 308 (2013).
8. When consideration of questions of merit is essential to a thorough
analysis of whether the prerequisites of Rule 23 of the West Virginia Rules of Civil
ii
Procedure [2017] for class certification are satisfied, failing to undertake such
consideration is clear error and an abuse of discretion.
iii
Armstead, Justice:
This case is before the Court on a petition for writ of prohibition.
Respondent Phillip D. Gaujot, Judge of the Circuit Court of Monongalia County, certified
a class action against Petitioners, West Virginia University Hospitals, Inc. (“WVUH”), and
West Virginia United Health System, Inc. (“WVUHS” and, together with WVUH, the
“Hospitals”). Judge Gaujot named Respondents Christopher Thomack and Joseph
Michael Jenkins as lead plaintiffs. The Hospitals later moved to decertify the class, and
Judge Gaujot denied their motion. The Hospitals believe that Judge Gaujot erred, and they
ask this Court to prohibit him from conducting any further proceedings until he has vacated
his order denying their motion to decertify the class.
Based on the record before us, the arguments of the parties, and the
applicable law, we find that the circuit court exceeded its jurisdiction by failing to conduct
a sufficiently thorough analysis of whether the commonality required for class certification
under Rule 23 of the West Virginia Rules of Civil Procedure is present. Accordingly, we
grant the writ of prohibition as moulded, vacate the circuit court’s order denying the
Hospitals’ motion to decertify the class, and remand this case for further actions consistent
with this opinion.
I. FACTUAL AND PROCEDURAL BACKGROUND
In 2012, Mr. Thomack and Mr. Jenkins were injured in separate accidents.
They were treated at Ruby Memorial Hospital. Each hired an attorney to seek damages for
his injuries, and each attorney requested copies of his client’s medical records. Mr.
1
Thomack alleges that WVUHS charged his attorney $514.40 for his medical records. Mr.
Jenkins says that WVUHS charged his attorney $656.80. WVUHS arrived at these fees by
charging “40 cents per page” plus an additional $10.00 fee for “[p]rocessing.” WVUHS
charged by the page, though it provided the records as images on a computer disc.
Mr. Thomack and Mr. Jenkins believe that these fees were illegal. On
January 18, 2013, Mr. Thomack sued WVUH in the Circuit Court of Monongalia County.1
Later, on June 27, 2013, Mr. Jenkins sued WVUHS2 in the Circuit Court of Harrison
County. Each plaintiff sued individually and as the (would be) representative of a class of
similarly situated persons. Their cases were subsequently consolidated in the Circuit Court
of Monongalia County.
On or about January 9, 2014, after consolidation, Mr. Thomack and Mr.
Jenkins filed a consolidated and amended class action complaint against the Hospitals in
the Circuit Court of Monongalia County. The consolidated complaint’s central allegation
is that the Hospitals violated W. Va. Code § 16-29-2(a) [1999] by “charg[ing] Plaintiffs
$0.40 ‘per page’ for copies of their already existing medical records[.]”
In October 2013—before consolidation—Mr. Thomack moved for class
certification under Rule 23. The Hospitals opposed the motion in a memorandum filed in
March 2014, after consolidation. They argued that a “fact intensive, case-by-case analysis
1
Mr. Thomack’s case was removed to the United States District Court for
the Northern District of West Virginia, but the case was remanded to the Circuit Court of
Monongalia County in October 2013.
2
Mr. Jenkins sued other parties as well, but those parties and his claims
against them are not relevant to this case.
2
. . . will be required to determine whether the fees imposed by WVUH and paid by each
class member were, in fact, reasonable or unreasonable.” They supported this argument
with an affidavit from Melissa Martin, WVUH’s director of health information
management and chief privacy officer. In her affidavit, Ms. Martin described a variety of
“electronic and/or physical storage systems” that must be searched when WVUH responds
to a records request.
Ms. Martin also described what happens after the records have been located.
She reported that medical records “are extracted and copied into a production system[.]”3
Then “a WVUH technician manually inspects the document bundle to ensure that the
production complies with the scope of the request and that no images are duplicates or
illegible.” She explained that this inspection process “can be very time consuming”
because mental health information enjoys special protection and may be embedded in other
records. Because of this concern, employees must actually “read the medical records”
(emphasis added). Once this inspection is complete, WVUH counts the number of images
and invoices the person who requested them. When WVUH receives payment, it saves the
assembled records to a computer disc and conducts a further inspection to ensure that the
records have been properly saved to the disc.
3
Paper records are produced as hard copies “or scanned into [an electronic
storage system], then extracted from [the electronic storage system] and downloaded into
a production system for electronic production.” Electronic records that “cannot be
extracted electronically” are either printed and produced as hard copies or produced
electronically, using a similar process of printing, scanning, extracting, and downloading.
3
The parties argued the certification motion on March 31, 2014. Mr. Thomack
and Mr. Jenkins emphasized the Hospitals’ uniform charging practices and claimed the
Hospitals were trying to “offset” their “search cost by charging 40 cents a page[.]” They
proposed that an expert could determine the Hospitals’ “actual cost” of producing medical
records. In arguing this, Mr. Thomack and Mr. Jenkins seemed to assume that the
Hospitals’ actual cost could be determined on some basis—seemingly a “rate” per page—
that would allow liability to be shown by a simple comparison with the Hospitals’ fee per
page. On their theory of the case, “whether or not [the Hospitals] are actually overcharging,
that’s a merits issue.”
The Hospitals argued that commonality was “the crux of this case” and urged
the circuit court to “look at . . . the kind of proof that’s going to be necessary for [the class
plaintiffs] to prevail.” They conceded that “all” had been “charged 40 cents a page and a
$10 search fee[,]” yet they believed that commonality remained absent. According to them,
deciding the case would require “look[ing] at each individual request [for medical records]
and determin[ing] under the circumstances for the records that have been produced and the
charges that were made, is that reasonable[?]” These arguments suggested to the circuit
court that the Hospitals had strayed “into the subject matter of the lawsuit[,]” and the court
agreed with Mr. Thomack and Mr. Jenkins that, at the certification stage, there was no need
for them to show that they could “prevail on the merits[.]”
On April 16, 2014, the circuit court entered an order certifying a class of:
All individuals who have requested copies of their medical
records from [the Hospitals] . . . , and their related entities, at
4
any time during the five (5) years preceding the filing of this
lawsuit, and who paid the fees charged by the [Hospitals] . . . ,
and their related entities, to obtain their medical records.
The court certified the class as to the claims raised in the consolidated
complaint and noted that “the reasonableness of the forty (40) cents per page charged to
patients” is “[t]he most significant issue” and one that “is common to every member of the
class and dominates the litigation as a whole.” The court also found “a common issue of
fact” in “the uniform nature of Defendants’ [pricing] policy[.]”
The order expressly dismissed the Hospitals’ objections and factual claims,
interpreting them as an argument about damages. According to the court, the Hospitals
“argue that the Plaintiffs’ claims will be subject to individualized inquiries, as a result of
the varying amounts charged to each individual to produce medical records” (emphasis
added). The Hospitals’ assertion was wrong, according to the court, “because the claims
are based on a readily identifiable, standard calculation of forty (40) cents per page.” These
individual showings, the court held, “address the damages, and do not affect the underlying
common issues regarding whether the charges are permissible under the applicable
statute” (emphasis added).4
4
On June 25, 2014, the Hospitals challenged the circuit court’s certification
order in a petition for writ of prohibition filed with this Court. We entered a summary
order refusing the petition on August 26, 2014. State ex rel. W. Va. Univ. Hosp., Inc. v.
Gaujot, No. 14-0611 (Aug. 26, 2014).
5
The circuit court revised the class definition in a subsequent order entered on
November 12, 2015. The court clarified that the term “individuals” included both
“individual patients” and a “representative requesting records on behalf of the patient, if
the patient could ultimately be held responsible to pay the cost[.]”5
In 2017, we issued two decisions6 that, according to the Hospitals, undercut
the circuit court’s class certification decisions. The Hospitals moved to decertify the class,
advancing a new argument that Mr. Jenkins7 lacked standing because he had yet to
reimburse his attorney for the cost of obtaining his medical records. 8 They also renewed
their attack on commonality, arguing that establishing “liability under W. Va. Code §16-
29-2 [would] require[] an individualized analysis of the amount WVUH charged each class
member versus the amount [WVUH] actually expended to compile the class member’s
records.”
Mr. Thomack and Mr. Jenkins responded that Mr. Jenkins had, indeed,
“reimbursed his attorney” and that, for purposes of certification, standing on the part of a
class representative is sufficient. Regarding commonality, they contended that each
5
The circuit court also modified the window of time that determined
membership in the class based on amendments to W. Va. Code §§16-29-1 and -2 that
became effective on June 6, 2014.
6
State ex rel. Healthport Techs., LLC v. Stucky, 239 W. Va. 239, 800 S.E.2d
506 (2017) (addressing standing); and State ex rel. Erie Ins. Prop. & Cas. Co. v. Nibert,
No. 16-0884, 2017 WL 564160 (W. Va. Feb. 13, 2017) (memorandum decision)
(addressing commonality).
7
This argument did not apply to Mr. Thomack, because his deposition
indicated that this cost was deducted from his personal injury settlement.
8
The Hospitals further argued that the words “if the patient could ultimately
be held responsible to pay the cost” made the class unascertainable.
6
member of the class had experienced “the same harm . . .—paying more for copies of their
medical records than [the Hospitals] were permitted to charge” and that this harm “ar[ose]
out of the same wrongful conduct—[the Hospitals’] systematic charging of a per-page
amount, plus a maximum search fee, despite the actual costs incurred . . . in producing the
requested copies.” They reiterated that “[a]ny ‘individualized’ finding is simply the
calculation of the extent to which the charges were excessive[.]”
The circuit court heard oral argument on December 13, 2017. The Hospitals
captured the essence of this case when their attorney observed, “we, frankly, have a
disagreement as to what that statute means[.]” He explained,
Under the plaintiffs’ theory, we’re only allowed to recover the
actual cost. So how do we determine that? We have to do an
individualized assessment of what it took to pull the records
from Mr. Thomack, the records from Mr. Jenkins, and how
much it cost us to do that, and then compare that to what we
charged them. . . .
This is the precise type of individualized
determination for liability purposes which is not allowed under
the commonality requirement[.]9
In response, Mr. Thomack and Mr. Jenkins accused the Hospitals of
“argu[ing] the merits before we even get there” and challenged the Hospitals’ right to
demand individual proof when they had “charged a flat rate to everybody.” Mr. Thomack
9
The Hospitals also offered their own competing interpretation of W. Va.
Code §16-29-2(a) [1999], which “is that . . . you can charge up to a certain thing and that’s
a safe harbor, and as long as you don’t exceed the [sic] up to a certain cost in the statute,
you’re okay.” The Hospitals do not appear, however, to have asked the circuit court to
embrace their interpretation, and we take no position on whether it is or is not correct.
7
and Mr. Jenkins professed to have “experts that will . . . look at [the Hospitals’] system and
say, I don’t care how you did it, this would be the amount[.]”
The circuit court denied the Hospitals’ motion to decertify the class in an
order entered on February 23, 2018. In the order, the court seemed to agree that the
Hospitals’ uniform charging policy was “in direct violation of the” statute’s directive “to
only charge the reasonable amount incurred to reimburse [the Hospitals] for the production
of the records.” The Court again dismissed the Hospitals’ concerns about the need for
individualized proof of liability. “Any ‘individualized’ finding is simply the calculation of
the extent to which the charges were excessive” (emphasis added). According to the court,
every plaintiff “claimed the same damages . . . , which is the difference between the amount
that he or she was charged for copies . . . [and] the amount that was incurred by Defendants
to produce them.”
The circuit court did, however, determine that the class definition should be
further modified to “includ[e] attorneys who have requested and paid for medical records
on behalf of their patient clients” (emphasis in original). Pursuant to this determination,
the circuit court entered a further order on July 5, 2018 that identified the class as follows:
Any person[] who, from January 18, 2008 until June 5, 2014,
(1) requested in writing copies of patient medical records from
[WVUH], including the individual patient and any person who
was an authorized agent or authorized representative of the
patient through legal representation; and
(2) paid the fees charged by [WVUH] to obtain such requested
medical records.
8
The Hospitals filed this petition for a writ of prohibition on October 1, 2018,
challenging the circuit court’s February 23, 2018 order refusing to decertify the class.10
Mr. Thomack and Mr. Jenkins filed a “summary response” on October 31, 2018.11
II. STANDARD OF REVIEW
Generally, “[t]his Court will review a circuit court’s order granting or
denying a motion for class certification pursuant to Rule 23 of the West Virginia Rules of
Civil Procedure [1998] under an abuse of discretion standard.” Syl. Pt. 1, In re W. Va.
Rezulin Litig., 214 W. Va. 52, 585 S.E.2d 52 (2003). However, the Hospitals are seeking
a writ of prohibition,12 and we have said that “[a] writ of prohibition will not issue to
prevent a simple abuse of discretion by a trial court. It will only issue where the trial court
10
The Hospitals also challenge an August 9, 2018 order of the circuit court
that refused to accord preclusive effect to the settlement order in Guida v. Wierton Med.
Ctr., Inc., No. 01-C-57 (Brooke Cty. Cir. Ct. Oct. 28, 2003). Guida required the Hospitals
to charge “forty (40) cents per page, together with a fee not to exceed $10 per request” for
the seven-year period from December 1, 2003, to December 1, 2010. Id. at 12. Because
we grant the writ as moulded on other grounds, we need not consider whether the circuit
court erred.
11
In their response, and in an accompanying motion, Mr. Thomack and Mr.
Jenkins begged “leave to submit full, substantive briefing” if this Court elected to hear oral
argument on the writ petition. This request was improper. The West Virginia Rules of
Appellate Procedure authorize respondents to file either the full response directed by Rule
16(g) or the summary response permitted by Rule 16(h). Cf. W. Va. R. App. P. 16(g) and
(h) [2010]. Rule 16(h) is clear that a summary response is filed “[i]nstead of a response[.]”
W. Va. R. App. P. 16(h) (emphasis added). Thus, when Mr. Thomack and Mr. Jenkins
elected to file a summary response, they waived their right to file a full response.
12
“‘An order denying class action standing under Rule 23 of the West
Virginia Rules of Civil Procedure may be appealed by the party who asserts such class
standing.’ Syllabus point 6, Mitchem v. Melton, 167 W.Va. 21, 277 S.E.2d 895 [1981].
Conversely, an order awarding class action standing is also reviewable, but only by writ of
prohibition.” Syl. Pt. 2, McFoy v. Amerigas, Inc., 170 W. Va. 526, 295 S.E.2d 16 (1982).
9
has no jurisdiction or having such jurisdiction exceeds its legitimate powers.” Syl. Pt. 1,
State ex rel. Healthport Techs., LLC v. Stucky, 239 W. Va. 239, 800 S.E.2d 506 (2017)
(cleaned up). When a petitioner claims that a circuit court has exceeded its powers, our
test is:
(1) whether the party seeking the writ has no other adequate
means, such as direct appeal, to obtain the desired relief; (2)
whether the petitioner will be damaged or prejudiced in a way
that is not correctable on appeal; (3) whether the lower
tribunal’s order is clearly erroneous as a matter of law; (4)
whether the lower tribunal’s order is an oft repeated error or
manifests persistent disregard for either procedural or
substantive law; and (5) whether the lower tribunal’s order
raises new and important problems or issues of law of first
impression.
Syl. Pt. 4 (in part), State ex rel. Hoover v. Berger, 199 W. Va. 12, 483 S.E.2d 12 (1996);
see also Rezulin, 214 W. Va. at 62, 585 S.E.2d at 62. “These factors are general guidelines
that serve as a useful starting point[.]” Id. While we need not find that all factors are
present, we attach “substantial weight” to the factor that asks “whether the lower tribunal’s
order is clearly erroneous as a matter of law[.]” Id. With these considerations in mind, we
turn to the Hospitals’ petition.
III. ANALYSIS
The Hospitals argue that the class lacks the features of commonality and
ascertainability required by Rule 23 of the West Virginia Rules of Civil Procedure. They
also contend that the class, as defined, includes people who lack standing to participate in
the class action. The Hospitals assert that all five Hoover factors weigh in favor of granting
their requested writ. Foremost, according to the Hospitals, is the fact that they “have no
10
other way of challenging the trial court’s denial of their Motion to Decertify Class.” We
agree with the Hospitals that whether commonality exists for this class is “the crux of this
case[.]” We proceed to consider that question now.
“Before certifying a class under Rule 23 of the West Virginia Rules of Civil
Procedure [1998],13 a circuit court must determine that the party seeking class certification
has satisfied all four prerequisites contained in Rule 23(a)—numerosity, commonality,
typicality, and adequacy of representation[.]” Syl. Pt. 8 (in part), Rezulin, 214 W. Va. 52,
585 S.E.2d 52 (emphasis added).14 Whether these prerequisites exist is a matter left to the
circuit court’s “sound discretion[,]” and we have said that “doubtful case[s] should be
resolved in favor of allowing class certification.” Syl. Pt. 5, Rezulin, 214 W. Va. 52, 585
S.E.2d 52 (cleaned up); and Rezulin, 214 W. Va. at 65, 585 S.E.2d at 65.
That does not mean, however, that certification determinations are
perfunctory. The plaintiff or defendant who proposes certification bears the burden of
proving that certification is warranted. Syl. Pt. 4, Rezulin, 214 W. Va. 52, 585 S.E.2d 52.
The circuit court must give careful consideration to whether the party has met that burden.
“A class action may only be certified if the trial court is satisfied, after a thorough analysis,
that the prerequisites of Rule 23(a) of the West Virginia Rules of Civil Procedure have been
13
We amended Rule 23 on March 8, 2017, while the consolidated action was
pending. The amendment added subsection (f) (residual funds) and is not relevant to the
parties’ dispute. In re: Adoption of Amendment to Rule 23, Class Actions, of the West
Virginia Rules of Civil Procedure, No. 16-Rules-18 (March 8, 2017).
14
Additional prerequisites are listed in Rule 23(b). Id.; and W. Va. R. Civ.
P. 23(b) [2017].
11
satisfied.” Syl. Pt. 8 (in part), State ex rel. Chemtall Inc. v. Madden, 216 W. Va. 443, 607
S.E.2d 772 (2004) (italics added). “[F]ailure to conduct a thorough analysis . . . amounts
to clear error.” Chemtall, 216 W. Va. at 454, 607 S.E.2d at 783. It is also an abuse of
discretion. Brown v. Nucor Corp., 785 F.3d 895, 902 (4th Cir. 2015) (“A district court
abuses its discretion when it materially misapplies the requirements of Rule 23.”). The
circuit court must approach certification decisions in a conscientious, careful, and
methodical fashion.
As noted above, commonality is an essential criterion of class certification.
We have observed that “[t]he ‘commonality’ requirement of Rule 23(a)(2) of the West
Virginia Rules of Civil Procedure [1998] requires that the party seeking class certification
show that ‘there are questions of law or fact common to the class.’” Syl. Pt. 11 (in part),
Rezulin, 214 W. Va. 52, 585 S.E.2d 52. “The threshold of ‘commonality’ is not high, and
requires only that the resolution of common questions affect all or a substantial number of
the class members.” Id. “A common nucleus of operative fact or law is usually enough[.]”
Id.
In this case, the circuit court found common questions of law and fact in the
Hospitals’ uniform practice of charging forty cents per page (or per image) for medical
records. Mr. Thomack and Mr. Jenkins’s case turns on the core allegation that the
Hospitals’ uniform charging practice violated W. Va. Code § 16-29-2(a) [1999]. At all
relevant times, section 2(a) said that a health care provider:
shall be reimbursed . . . for all reasonable expenses incurred in
complying with this article: Provided, That the cost may not
12
exceed seventy-five cents per page for the copying of any
record or records which have already been reduced to written
form[,] and a search fee may not exceed ten dollars.
Id.
However, not everything that may be loosely called a “question of fact” is
sufficient to meet Rule 23’s “threshold” of commonality. Indeed, “a ‘question’ ‘common
to the class’ must be a dispute, either of fact or of law, the resolution of which will advance
the determination of the class members’ claims.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S.
338, 369, 131 S. Ct. 2541, 2562, 180 L. Ed. 2d 374 (2011) (Ginsburg concurring in part
and dissenting in part) (emphasis added).
Similarly, it is not enough for Mr. Thomack and Mr. Jenkins to allege that
they and others like them are victims of the same statutory violation. For commonality to
exist, class members’ “claims must depend upon a common contention[,]” and that
contention “must be of such a nature that it is capable of classwide resolution[.]” State ex
rel. Erie Ins. Prop. & Cas. Co. v. Nibert, No. 16-0884, 2017 WL 564160, at *6 (W. Va.
Feb. 13, 2017) (memorandum decision) (quoting Wal-Mart, 564 U.S. at 350, 131 S. Ct. at
2551, 180 L. Ed. 2d 374). In other words, the issue of law (or fact) in question must be
one whose “determination . . . will resolve an issue that is central to the validity of each
one of the claims in one stroke.” Id. (emphasis added). This is not a new doctrine. While
a capacity to resolve “common questions” may be the “only” thing that commonality
requires, commonality requires at least that much. Syl. Pt. 11 (in part), Rezulin, 214 W.
Va. 52, 585 S.E.2d 52 (“The threshold of ‘commonality’ is not high, and requires only that
13
the resolution of common questions affect all or a substantial number of the class
members.” (emphasis added)).
In this case, the determination of commonality necessarily required a review
of the alleged harm suffered by the plaintiffs. This, in turn, would require at least an initial
review of the merits. “When a circuit court is evaluating a motion for class certification
under Rule 23 of the West Virginia Rules of Civil Procedure [1998], the dispositive
question is not whether the plaintiff has stated a cause of action or will prevail on the merits,
but rather whether the requirements of Rule 23 have been met.” Syl. Pt. 7, Rezulin, 214
W. Va. 52, 585 S.E.2d 52. However, determining whether the requirements of Rule 23 of
the West Virginia Rules of Civil Procedure [2017] have been met often involves, by
necessity, some “coincidental” consideration of the merits. Gariety v. Grant Thornton,
LLP, 368 F.3d 356, 366 (4th Cir. 2004) (“The analysis under Rule 23 must focus on the
requirements of the rule, and if findings made in connection with those requirements
overlap findings that will have to be made on the merits, such overlap is only
coincidental.”) The United States Supreme Court has observed that “class determination
generally involves considerations that are enmeshed in the factual and legal issues
comprising the plaintiff[]s[’] cause of action.” Comcast Corp. v. Behrend, 569 U.S. 27,
34, 133 S. Ct. 1426, 1432, 185 L. Ed. 2d 515 (2013) (cleaned up). Our prior certification
decisions bear that out. See, e.g., Chemtall, 216 W. Va. at 455, 607 S.E.2d at 784; Ways v.
Imation Enterprises Corp., 214 W. Va. 305, 314, 589 S.E.2d 36, 45 (2003).
14
“Merits questions may be considered to the extent—but only to the extent—
that they are relevant to determining whether the Rule 23 prerequisites for class
certification are satisfied.” Amgen Inc. v. Connecticut Ret. Plans & Tr. Funds, 568 U.S.
455, 466, 133 S. Ct. 1184, 1195, 185 L. Ed. 2d 308 (2013). We hold that when
consideration of questions of merit is essential to a thorough analysis of whether the
prerequisites of Rule 23 of the West Virginia Rules of Civil Procedure [2017] for class
certification are satisfied, failing to undertake such consideration is clear error and an abuse
of discretion.
Mr. Thomack and Mr. Jenkins believe—and the circuit court agreed with
them—that the Hospitals’ uniform charging practices violated W. Va. Code § 16-29-2(a)
[1999]. They concede that some individualized proof may be necessary to determine
damages, but they believe that the core issue of liability may be determined by aggregate
proof. The Hospitals repeatedly challenged this assertion. On their reading of the statute,
individualized proof will be necessary to determine not just damages but liability itself.
According to them, each separate request for medical records will have to be examined to
determine whether the Hospitals charged more than “all reasonable expenses incurred in
complying with [the statute.]” Id. Whether each charge for medical records exceeded the
Hospitals’ actual “reasonable expenses incurred” raises questions that relate to both
liability and, if liability is determined, the amount of the damages incurred. The statute is
framed such that liability and damages are two sides of the same coin, and we fail to see
how a plaintiff could prove that a charge exceeded actual expenses, thus, establishing
15
liability, without also proving by how much the charge exceeded actual expenses, and
thereby establishing the amount of damages.
It may be, as the Hospitals contend, that the statute demands that “all
reasonable expenses incurred” be determined on a per-request basis. While this is a
question on the merits for the circuit court to determine, the Martin affidavit suggests that
“all reasonable expenses incurred” to produce 1,000 pages (or images) of medical records
for one person might be different from “all reasonable expenses incurred” to produce the
same quantity of medical records for another person. In that case, a charge of $40015 might
be lawful for one request and unlawful for another. The fact that the Hospitals charged all
class members by the page (or by the image) does not change the statute or the fact that the
statute’s terms define the boundary between lawful and unlawful charges.
These are questions that must be decided in the first instance by the circuit
court. On the record before us, it does not appear that the circuit court has addressed the
question of commonality with sufficient factual findings and conclusions to allow us to
conclude that its certification decision and subsequent refusal to decertify the class were
the product of “a thorough analysis[.]” Syl. Pt. 8 (in part), Chemtall, 216 W. Va. 443, 607
S.E.2d 772.
The Hospitals repeatedly challenged Mr. Thomack and Mr. Jenkins’s claim
that commonality could be found in the Hospitals’ uniform charging practices and in the
15
This would be the charge for 1,000 pages (or images) at forty cents per
page.
16
Hospitals’ alleged violation of W. Va. Code § 16-29-2(a) [1999]. Yet the circuit court
persisted in finding commonality without ever truly addressing the Hospitals’ arguments
or indicating with clarity the rational for such findings. Accordingly, and for the reasons
set forth above, we grant the Hospitals’ writ of prohibition and vacate the circuit court’s
order denying the Hospitals’ motion to decertify the class.
Because we grant the writ as moulded and vacate the circuit court’s order,
we need not consider the Hospitals’ other grounds for seeking a writ of prohibition.
IV. CONCLUSION
For the foregoing reasons, we conclude that the circuit court has exceeded its
legitimate powers by certifying the class while failing to conduct a sufficiently thorough
analysis of the case to determine whether the commonality required for class certification
under Rule 23 of the West Virginia Rules of Civil Procedure is present. Upon remand, we
urge the circuit court to determine whether the requirements of Rule 23, particularly as they
relate to commonality, have been met and, if so, to craft a class definition consistent with
such findings.16
16
We would note some concerns about the circuit court’s July 5, 2018 order
defining a class of plaintiffs that includes attorneys who requested their clients’ medical
records and “paid the fees[.]” The order would appear to mean that an attorney who
requests and pays for a client’s medical records (at least until such time, if any, that the
client reimburses the attorney) would personally be a member of the class and, therefore,
a litigant in the action. If so, are the attorney’s efforts for the attorney or the client? Such
a scenario raises questions regarding ethical standards governing the attorney’s role in the
litigation. See W. Va. R. Prof. Conduct 1.8(i) [2015] (“A lawyer shall not acquire a
proprietary interest in the cause of action or subject matter of litigation the lawyer is
17
Accordingly, the Hospitals’ writ of prohibition is granted as moulded, the
circuit court’s order denying the Hospitals’ motion to decertify the class is vacated, and
this case is remanded for further actions consistent with this opinion.
Writ granted as moulded.
conducting for a client[.]”). We believe that the question of whether attorneys who pay for
their clients’ records should be included in any class should be given careful consideration
if, after further proceedings below, the circuit court determines that Mr. Thomack and Mr.
Jenkins’s consolidated claims satisfy the commonality and other requirements of Rule 23.
18