In re: State Farm Fire and Casualty Company Petitioner/Defendant-Appellant Amanda LaBrier Respondent/Plaintiff - Appellee Chamber of Commerce of the United States; Liberty Mutual Fire Insurance Company; Safeco Insurance Company of America; Lawyers for Civil Justice; Allstate Insurance Company; American Family Mutual Insurance Company; American Insurance Association; Property Casualty Insurers Association of America; Amid on Behalf of Petitioner/Appellant United Policy Holders Amicus on Behalf of Respondent/Appellee
Submitted: January 11, 2017
from United States District Court for the Western District of
Missouri - Jefferson City
WOLLMAN, LOKEN, and MURPHY, Circuit Judges.
hailstorm struck Amanda LaBrier's home in St. Louis,
Missouri, damaging the home's exterior roof, siding, and
gutters. LaBrier filed a property damage claim with State
Farm Fire and Casualty Company under the Coverage A -
Dwelling section of her State Farm Homeowners Policy. The
policy provides "Replacement Cost" property loss
coverage, that is, "the cost to repair or replace . . .
the damaged part of [covered] property." However, the
policy's Loss Settlement provisions state that,
"until actual repair or replacement is completed, we
will pay only the actual cash value at the time of the loss
of the damaged part of the property . . . not to exceed the
cost to repair or replace the damaged part." The policy
does not define actual cash value. State Farm provides
insureds a "Building Estimate Summary Guide" that
explains, "Net Actual Cash Value Payment" means
"[t]he repair or replacement cost of the damaged part of
the property less depreciation and deductible, " and
defines "depreciation" as "[t]he decrease in
the value of property over a period of time due to wear,
tear, condition, and obsolescence."
Farm's adjuster inspected LaBrier's home, determined
the dwelling had suffered covered property damage, and
estimated replacement cost by inputting each damaged part
into a computer program called Xactimate. The Xactimate
estimate of total cost to repair LaBrier's home was $8,
088.07. Consistent with State Farm's practice in Missouri
at that time, Xactimate also estimated depreciation at $2,
009.79 by multiplying each damaged item's replacement
cost by a depreciation factor that varied with the item's
age. State Farm subtracted this estimated depreciation and
LaBrier's deductible ($1, 421) from the estimated
replacement cost and paid LaBrier $4, 657.28 for the actual
cash value of the damaged property. In a statement attached
to the payment, State Farm explained, "[b]ased on our
estimate, the additional amount available to you for
replacement cost benefits (recoverable depreciation) is $2,
than seek an additional replacement cost benefit under the
policy, or challenge State Farm's estimated actual cash
value payment by an appraisal proceeding or by an action in
court -- remedies the policy expressly authorizes --LaBrier
paid a family friend $5, 975 to repair her home and brought
this putative class action in Missouri state court, alleging
that State Farm's practice of deducting "labor
depreciation" from estimated replacement cost in
determining actual cash value breached the insurance
contract. State Farm removed the case to federal court and
moved to dismiss. The district court denied the motion,
concluding that "actual cash value" and
"depreciation" are ambiguous terms that must be
construed in favor of insureds under Missouri law and
therefore State Farm breached the insurance contract when it
depreciated labor in estimating actual cash value.
LaBrier v. State Farm Fire & Cas. Co., 147
F.Supp.3d 839, 846-47, 849-51 (W.D. Mo. 2015) (LaBrier
upon its decision denying State Farm's motion to dismiss,
the district court ordered full discovery before a class was
certified and appointed a special master to supervise
discovery disputes. After much wrangling over access to State
Farm's claims-adjusting database and other issues, the
special master in Special Master Order No. 4 ordered State
Farm to answer interrogatories asking it to identify for all
144, 900 putative class members (i) "labor depreciation
that was actually withheld, " (ii) the date labor
depreciation was withheld, (iii) any labor depreciation State
Farm subsequently paid as replacement cost benefits, and (iv)
any facts that support State Farm's affirmative defenses.
district court overruled State Farm's objections to Order
No. 4, concluding that State Farm failed to establish that
the Order caused an undue burden in light of the
discovery's relevance and State Farm's refusal to
provide another method to discover the information.
LaBrier v. State Farm Fire & Cas. Co., 314
F.R.D. 637, 641-43 (W.D. Mo. 2016) (LaBrier II).
State Farm petitioned for a writ of mandamus, asking this
Court to vacate what it alleges are overly-burdensome
discovery orders. On the day State Farm filed its mandamus
petition, the district court certified a class consisting of:
All State Farm Fire and Casualty Company . . . property
insurance policyholders who submitted a claim for structural
damage to a property in Missouri, and whose actual cash value
. . . payment was reduced by the withholding of labor
depreciation, during the time period from March 20, 2005 to
the date of trial, inclusive.
court excluded only insureds who were paid their policy
limits and those whose claims were the subject of appraisal
or litigation. LaBrier v. State Farm Fire & Cas.
Co., 315 F.R.D. 503, 510-11 (W.D. Mo. 2016) (LaBrier
III). We granted State Farm leave to appeal the class
certification, see Fed.R.Civ.P. 23(f), consolidated
the appeal with State Farm's petition for a writ of
mandamus, and now reverse.
class action may be certified unless the party seeking
certification "affirmatively demonstrate[s] his
compliance with Rule 23." Comcast Corp. v.
Behrend, 133 S.Ct. 1426, 1432 (2013) (quotation
omitted). "Here, the district court certified the
class under Rule 23(b)(3), which requires finding 'that
the questions of law or fact common to class members
predominate over any questions affecting only individual
members, and that a class action is superior to other
available methods for fairly and efficiently adjudicating the
controversy.'" Powers v. Credit Mgmt. Servs.,
Inc., 776 F.3d 567, 569 (8th Cir. 2015).
"An individual question is one where members of a
proposed class will need to present evidence that varies from
member to member, while a common question is one where the
same evidence will suffice for each member to make a prima
facie showing or the issue is susceptible to generalized,
class-wide proof." Tyson Foods, Inc. v.
Bouaphakeo, 136 S.Ct. 1036, 1045 (2016) (quotation
omitted). "What matters to class certification . . . is
not the raising of common 'questions' -- even in
droves --but, rather the capacity of a classwide proceeding
to generate common answers apt to drive the
resolution of the litigation." Wal-Mart Stores, Inc.
v. Dukes, 564 U.S. 338, 350 (2011) (quotation omitted).
This "preliminary inquiry . . . may require the court to
resolve disputes going to the factual setting of the case,
and such disputes may overlap the merits of the case."
Powers, 776 F.3d at 569 (quotation omitted); see
Comcast, 133 S.Ct. at 1432. To prove a breach of
contract, LaBrier must show: (1) the existence of a contract;
(2) the rights and obligations of the parties; (3) State
Farm's breach; and (4) the damages she suffered. See
Kieffer v. Icaza, 376 S.W.3d 653, 657 (Mo. 2012). The
preliminary predominance inquiry requires "rigorous
analysis" of whether "the same evidence will