Taqueria El Primo LLC v. Farmers Group, Inc.

Background

Defendants sold automobile insurance in Minnesota. The plaintiffs alleged that the defendants entered agreements with health care providers under which the providers agreed not to bill the defendants for care provided to insureds, without notifying those insureds. According to the plaintiffs, these undisclosed billing limits restricted insureds’ ability to seek care from providers of their choice and violated Minnesota law, including the Minnesota No-Fault Automobile Insurance Act, as well as insurance-policy terms.

The court had previously certified an Injunctive Class under Federal Rule of Civil Procedure 23(b)(2) and a Damages Class under Rule 23(b)(3) on some claims. The court had granted the class-certification motion in part and denied it in part. The Eighth Circuit denied the defendants’ request for permission to appeal the class-certification ruling. This opinion addressed notice to class members, not the merits of the claims; the court stated that it had not resolved the merits of the case.

Legal standard

For a class certified under Rule 23(b)(3), Rule 23 and due process require notice that is the best practicable under the circumstances. The notice must reasonably inform identifiable class members about the case and give them an opportunity to object or exclude themselves. It must plainly describe the action, the class, the claims and defenses, the right to appear through an attorney, the process for exclusion, and the binding effect of a class judgment. The court also explained that notice must be neutral, objective, and concise.

Notice plan

The plaintiffs proposed sending a long-form notice by email when an email address could reasonably be identified and sending a short-form notice by United States mail when it could not. The plan also included a litigation website, an email address, and a toll-free telephone number with live-agent support and recorded messages. The plaintiffs’ notice administrator estimated that notice would reach virtually all class members, with an expected delivery range of 70 to 95 percent.

The defendants did not oppose the notice plan. The court found that the plan met due-process and Rule 23 requirements because it provided direct email or mailed notice based on available and updated contact information, along with ways for class members to obtain more information. The court modified the plan in two ways: the administrator had to mail a short-form notice when an emailed notice was returned or otherwise shown not to have been delivered, and the administrator had to take reasonable steps to find an updated mailing address and resend the notice when a mailed notice was returned as undeliverable.

Notice forms

The defendants objected to portions of both proposed forms. The court adopted some of the defendants’ formatting and organizational suggestions for the long-form notice but generally used the plaintiffs’ language with revisions. The court declined to add references to alleged medical-provider fraud and settlements because those references could confuse class members and were not necessary to explain the case or the legal issues.

For the short-form notice, the court required language stating that the defendants denied any violation of Minnesota law or denial of reimbursement for medical expense benefits. It also required an express statement that class members who remain in the class will be bound by the court’s orders and judgments, even if there is no recovery. The court clarified that the deadline to exclude oneself from the class runs for at least 60 days after notice is sent and applies to both online and mailed exclusion requests.

For the long-form notice, the court made changes to formatting, organization, clarity, the description of the case, the class members’ choices, the exclusion deadline, and the available exclusion methods. The court approved the long-form notice for use both on the litigation website and as the email notice. It authorized the notice administrator to make minor corrections and delivery-related changes without advance court approval, but required notice to the defendants of those changes.

Order and effect

The court ordered that the plaintiffs’ motion for approval of the form of class notice and plan of notice was granted as modified. The approved program required direct email of the long-form notice to class members whose email addresses could reasonably be identified; mailed short-form notices to those without reasonably identifiable email addresses; and mailed short-form notices to recipients whose email notices were not properly delivered.

The court approved the short-form and long-form notices, a case-specific website, an email address, and a toll-free number available 24 hours a day, seven days a week, in English and Spanish. It appointed Analytics Consulting LLC as the notice administrator and required the administrator to distribute the notices within 30 days after the order, file proof of distribution within 44 days, translate the forms into Spanish, and maintain the website and phone service. Class members could request exclusion online, by mail, or by email if the plaintiffs chose to offer that option, within 60 days after notice was sent. Class counsel had to file a list of timely exclusion requests within 30 days after that deadline.