Ford Motor Company v. Phillips, Joyce

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 05-8031
JOYCE ELAINE PHILLIPS, et al., on behalf of
themselves and all others similarly situated,
Plaintiffs-Respondents,
v.
FORD MOTOR COMPANY,
Defendant-Petitioner.
No. 05-8032
THOMAS BOXDORFER, et al., on behalf of
themselves and all others similarly situated,
Plaintiffs-Respondents,
v.
DAIMLERCHRYSLER CORPORATION,
Defendant-Petitioner.
____________
Petitions for Leave to Appeal from the United States District
Courts for the Southern and Central Districts of Illinois.
Nos. 05-CV-503-DRH, 05-3221—David R. Herndon,
Jeanne E. Scott, Judges.
____________
SUBMITTED NOVEMBER 1, 2005—DECIDED JANUARY 30, 2006
____________
2 Nos. 05-8031, 05-8032
Before POSNER, RIPPLE, and WOOD, Circuit Judges.
POSNER, Circuit Judge. Before us are petitions for leave
to appeal under the Class Action Fairness Act of 2005,
Pub. L. 109-2, 119 Stat. 4, from orders remanding two
class action suits to Illinois state courts. The question the
petitions present is whether amending a complaint to add
or substitute named plaintiffs (class representatives)
“commences” a new suit. Id., § 9. The suits were filed before
the effective date of the Class Action Fairness Act but the
amendments came after. So if the amendments are deemed
to commence new suits, these suits are removable to federal
district court; otherwise not. Knudsen v. Liberty Mutual Ins.
Co., 411 F.3d 805, 806 (7th Cir. 2005); Pritchett v. Office Depot,
Inc., 404 F.3d 1232 (10th Cir. 2005). No appellate court has
yet decided whether adding named plaintiffs to a class
action suit “commences” a new suit for purposes of removal
under CAFA.
The suits complain about the paint jobs on cars manu-
factured by the defendants. In the Phillips case, the plaintiffs,
after first alleging a class consisting of purchasers of 1988
through 1997 Ford models, amended their complaint to
limit the class to the 1989 through 1995 model years.
Nevertheless, for reasons that are obscure, the judge without
being asked to do so certified a class that included the 1996
models and in response the plaintiffs amended their
complaint a second time in order to add to their ranks the
owner of a 1996 model. This amendment came after CAFA’s
effective date. In the Boxdorfer case, the plaintiffs who were
added by amendment after the Act’s effective date were
members of the original class; they were added because it
was discovered that the claims of the original named
plaintiffs might be barred by the statute of limitations.
“A routine amendment to the complaint does not com-
mence a new suit.” Schorsch v. Hewlett-Packard Co., 417 F.3d
Nos. 05-8031, 05-8032 3
748, 749 (7th Cir. 2005). But is adding a plaintiff to a
class action suit “routine”? We said in Schorsch that “a
defendant added after [CAFA’s effective date] could remove
because suit against it would have been commenced after the
effective date, and tacking a wholly distinct claim for relief
onto an old suit likewise might commence a new proceed-
ing.” Id. (emphasis in original). An amendment that merely
changed the definition of and hence membership in the class
was “routine,” but we noted that the suit remained one
between the original parties. No named plaintiffs had been
added; the alteration of the class had added just new,
unnamed class members. Id. at 750.
Substitution of unnamed class members for named
plaintiffs who fall out of the case because of settlement or
other reasons is a common and normally an unexception-
able (“routine”) feature of class action litigation both in
the federal courts and in the Illinois courts. Gates v.
Towery, 430 F.3d 429, 430 (7th Cir. 2005); Birmingham
Steel Corp. v. TVA, 353 F.3d 1331, 1339 (11th Cir. 2003);
Toms v. Allied Bond & Collection Agency, Inc., 179 F.3d 103,
106-07 (4th Cir. 1999); Wheatley v. Board of Education, 459
N.E.2d 1364, 1366-68 (Ill. 1984); Yu v. International Business
Machines Corp., 732 N.E.2d 1173, 1178-79 (Ill. App. 2000);
Hess v. I.R.E. Real Estate Income Fund, 629 N.E.2d 520, 525-27
(Ill. App. 1999). But there is a potential complication here:
the plaintiff class in Boxdorfer has not been certified, and
we do not know whether a motion for certification is
pending or has been denied.
Strictly speaking, if no motion to certify has been filed
(perhaps if it has been filed but not acted on), the case is not
yet a class action and so a dismissal of the named plaintiffs’
claims should end the case. E.g., Walters v. Edgar, 163 F.3d
430, 432-33 (7th Cir. 1998). If the case is later restarted with
4 Nos. 05-8031, 05-8032
a new plaintiff, it is a new commencement, a new suit. But
the courts, both federal and Illinois, are not so strict. Unless
jurisdiction never attached, as in Walters v. Edgar, supra, or
the attempt to substitute comes long after the claims of the
named plaintiffs were dismissed, as in Lusardi v. Xerox Corp.,
975 F.2d 964, 977-78 (3d Cir. 1992); see also Sze v. INS, 153
F.3d 1005, 1010 (9th Cir. 1998); Tucker v. Phyfer, 819 F.2d
1030, 1036 (11th Cir. 1987), substitution for the named
plaintiffs is allowed. Baxter v. Palmigiano, 425 U.S. 308, 310
n. 1 (1976); Gates v. Towery, supra, 430 F.3d at 430; Egan v.
Davis, 118 F.3d 1148, 1150 (7th Cir. 1997); Rosetti v. Shalala,
12 F.3d 1216, 1232 n. 33 (3d Cir. 1993); In re Thornburgh, 869
F.2d 1503, 1508-09 (D.C. Cir. 1989); Gotches v. Heckler, 773
F.2d 108, 115 (7th Cir. 1985) (concurring opinion); Wheatley
v. Board of Education, supra, 459 N.E.2d at 1367-68; Yu v.
International Business Machines Corp., supra, 732 N.E.2d at
1179; Hess v. I.R.E. Real Estate Income Fund, supra, 629 N.E.2d
at 526-27.
The courts thus disregard the jurisdictional void that is
created when the named plaintiffs’ claims are dismissed
and, shortly afterwards, surrogates step forward to replace
the named plaintiffs. See also Schreiber Foods, Inc., v. Beatrice
Cheese, Inc., 402 F.3d 1198 (Fed. Cir. 2005), and Insituform
Technologies, Inc. v. CAT Contracting, Inc., 385 F.3d 1360,
1371-72 (Fed. Cir. 2004), discussed in DePuy, Inc. v. Zimmer
Holdings, Inc., 384 F. Supp. 2d 1237, 1238-40 (N.D. Ill. 2005).
This may seem irregular; but maybe there isn’t really a
jurisdictional void, since the class member who steps
forward to take the place of the dismissed plaintiff has a real
controversy with the defendant. In any event, although
substitution of new named plaintiffs is sought in Boxdorfer,
the named plaintiffs’ claims, though in jeopardy, haven’t
been dismissed; the case is very much alive.
Nos. 05-8031, 05-8032 5
Since the question for decision, now that the jurisdictional
wrinkle has been smoothed out, is whether adding named
plaintiffs commences a new suit in state court, the answer
should depend on state procedural law. The clearest case in
which an amended complaint does not kick off a new suit is
where the amendment “relates back” to the original com-
plaint. For then the fact that the statute of limitations has
run (as it may have against the named plaintiffs in Boxdorfer)
is not a bar, as it would be if the amended complaint did not
relate back—that is, if it stated a new claim and thus kicked
off a new suit. Norman A. Koglin Associates v. Valenz Oro, Inc.,
680 N.E.2d 283, 289-91 (Ill. 1997); Byson v. News America
Publications, 672 N.E.2d 1207, 1222-24 (Ill. 1996); Wolf v.
Meister-Neiberg, Inc., 570 N.E.2d 327 (Ill. 1991). Under Illinois
law as under federal law, an amendment relates back when
it arises out of “the same transaction or occurrence set up in
the original pleading.” 735 ILCS 5/2-616(b); Chandler v.
Illinois Central R.R., 798 N.E.2d 724, 732-33 (Ill. 2003); see
Fed. R. Civ. P. 15(c); Delgado-Brunet v. Clark, 93 F.3d 339, 343
(7th Cir. 1996); BP West Coast Products v. FERC, 374 F.3d
1263, 1312 (D.C. Cir. 2004) (per curiam). That well describes
these cases—obviously Boxdorfer but only a little less clearly
Phillips, for remember that the original complaint in that
case included the 1996 model year.
Relation back to add named plaintiffs in a class action suit
is of particular importance because of the interests of the
unnamed members of the class. Suppose Mr. X files a class
action and after the statute of limitations has run the
defendant settles with X. If a named plaintiff cannot be
substituted for X with relation back to the date of the fil-
ing of the original complaint, the class will be barred from
relief. That is the fate looming in Boxdorfer if relation back is
denied, and for all we know in Phillips as well for class
members who own 1996 Ford models. Since, for this reason,
6 Nos. 05-8031, 05-8032
Illinois in effect allows named plaintiffs to be substituted
with relation back (“in effect” because the formal rule is that
the filing of a class action tolls the statute of limitations for
class members, so that they can if necessary be substituted
for the named plaintiffs, without being barred by reason of
the passage of time since the suit was filed), Steinberg v.
Chicago Medical School, 371 N.E.2d 634, 645 (Ill. 1977);
Regnery v. Meyers, 679 N.E.2d 74, 81 (Ill. App. 1997) (this is
also the federal rule, American Pipe & Construction Co. v.
Utah, 414 U.S. 538, 553 (1974); Culver v. City of Milwaukee,
277 F.3d 908, 914 (7th Cir. 2002)), the addition of such
plaintiffs in the two cases before us did not commence new
suits. Remand was therefore required, as the district judges
ruled.
AFFIRMED
A true Copy:
Teste:
_____________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—1-30-06