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Siegel v. Shell Oil Co.

February 23, 2009

MICHAEL SIEGEL ON BEHALF OF HIMSELF, AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
v.
SHELL OIL COMPANY, A DELAWARE CORPORATION, BP CORPORATION NORTH AMERICA, INC., AN INDIANA CORPORATION, CITGO PETROLEUM CORPORATION, A DELAWARE CORPORATION, MARATHON OIL COMPANY, AN OHIO CORPORATION, AND EXXON MOBIL CORPORATION, A NEW JERSEY CORPORATION, DEFENDANTS.



The opinion of the court was delivered by: Amy J. St. Eve United States District Judge

MEMORANDUM OPINION AND ORDER

AMY J. ST. EVE, District Court Judge

In his Amended Class Action Complaint, Plaintiff Michael Siegel alleges that Defendants Shell Oil Company, BP Corporation North America, Inc., Citgo Petroleum Corporation, Marathon Oil Company, and Exxon Mobil Corporation are liable under the Illinois Consumer Fraud and Deceptive Business Practices Act ("ICFA"), 815 ILCS 505/1, et. seq., for deceptive and unfair practices (Counts I and II). Siegel also brings a common law unjust enrichment claim based on both tort and quasi-contract (Count III) and a common law civil conspiracy claim (Count IV). On September 23, 2008, the Court, in its discretion, denied Siegel's Amended Motion for Class Certification involving Siegel's proposed nationwide classes. (R. 308-1, Mem., Op., & Order.) Before the Court is Siegel's Second Amended Motion for Class Certification pursuant to Federal Rule of Civil Procedure 23. For the following reasons, the Court, in its discretion, denies Siegel's motion. Further, the Court denies Defendants' Motion to Exclude Plaintiff's Expert Testimony as moot.

BACKGROUND

In his Amended Class Action Complaint, Siegel alleges that "Defendants possess oligopolistic power and have possessed oligopolistic power throughout the entire class period, i.e., 2000 to the date of judgment, in the crude, refined and gasoline industry ("gas industry"), and have used this power in concert with their co-conspirators to illegally and artificially restrain trade and increase the price of gasoline to consumers by controlling their inventory, production, exports, limiting supply, restricting purchase, zone pricing, falsely advertising the scarceness of gasoline and excessive mark up between gasoline and crude prices." (R. 77-1, Amend. Compl. ¶ 1.) In the present motion for class certification, Siegel maintains that Defendants manipulated the nation's supply of gasoline resulting in Siegel and the proposed class being damaged through paying Defendants' inflated prices for gasoline. (R. 332-1, Pl.'s Second Amend. Mot. Class Cert., ¶ 1.) Siegel further contends that Defendants omitted material information, engaged in unfair practices, and that Defendants were unjustly enriched to the detriment of Siegel and the proposed class as a result of this conduct. (Id.) Siegel seeks certification of the following class: "All purchasers who made retail purchases of any Defendants' branded gasoline in Illinois during the period from and including December 2, 2000, through and including September 5, 2008." (Id. ¶ 2.)

LEGAL STANDARD

"[T]he primary purposes of the class-action mechanism" are "judicial economy and efficiency." Andrews v. Chevy Chase Bank, 545 F.3d 570, 577 (7th Cir. 2008); see also Thorogood v. Sears, Roebuck & Co., 547 F.3d 742, 744 (7th Cir. 2008) ("The class action is an ingenious device for economizing on the expense of litigation and enabling small claims to be litigated."). To that end, Federal Rule of Civil Procedure 23(a) states that "[o]ne or more members of a class may sue or be sued as representative parties on behalf of all only if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class." Fed.R.Civ.P. 23(a); Oshana v. Coca-Cola Co., 472 F.3d 506, 513 (7th Cir. 2006). Failure to meet any of these Rule 23(a) requirements precludes class certification. See Arreola v. Godinez, 546 F.3d 788, 797 (7th Cir. 2008).

In addition to satisfying the requirements under Rule 23(a), a party seeking class certification must also establish that the proposed class satisfies one of the requirements set forth in Rule 23(b). See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 614, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997); Arreola, 546 F.3d at 794. Here, Siegel requests certification of the proposed class pursuant to Rule 23(b)(3), which applies when "the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy." Fed.R.Civ.P. 23(b)(3); see also Amchem Prods., 521 U.S. at 615-16. Under Rule 23(b)(3), if "a few class members' injuries prove to be substantial, they may opt out and litigate independently." Murray v. GMAC Mortgage Corp., 434 F.3d 948, 953 (7th Cir. 2006).

The party seeking class certification has the burden of establishing that certification is proper. See Oshana, 472 F.3d at 513. In determining whether a party has carried that burden, a court need not accept all of the complaint's allegations as true. See Szabo v. Bridgeport Mach., Inc., 249 F.3d 672, 675 (7th Cir. 2001). Rather, in deciding whether to certify a class, the Court "should make whatever factual and legal inquiries [that] are necessary under Rule 23." Id. at 676; see also General Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982) (courts may "probe behind the pleadings before coming to rest on the certification question"). Finally, district courts have broad discretion in determining motions for class certification. See Reiter v. Sonotone Corp., 442 U.S. 330, 345, 99 S.Ct. 2326, 2334, 60 L.Ed.2d 931 (1979); Payton v. County of Carroll, 473 F.3d 845, 847 (7th Cir. 2007).

ANALYSIS

The Court turns to Rule 23(b)(3) because it is dispositive.*fn1 Under Rule 23(b)(3), the Court must determine whether (1) the questions of fact or law common to the class members predominate over questions affecting only the individual class members, and (2) a class action is superior to other available methods of adjudicating plaintiffs' claims. See Amchem Prods., 521 U.S. at 615; Andrews, 545 F.3d at 577.

I. Predominance

Here, Defendants maintain that Siegel cannot establish -- through common proof -- that Defendants' conduct proximately caused harm to each member of the putative class, and thus Siegel has failed in his burden of establishing that class treatment is appropriate under Rule 23(b)(3). The Court agrees. When determining if a plaintiff has met the predominance requirement, district courts look beyond the pleadings to determine whether the plaintiff's claims are subject to class-wide proof by common evidence. See Thorogood, 547 F.3d at 747-48; Andrews, 545 F.3d at 577; Pastor v. State Farm Mut. Auto. Ins. Co., 487 F.3d 1042, 1046-47 (7th Cir. 2007); Hewitt v. Joyce Beverages of Wis., Inc., 721 F.2d 625, 628-29 (7th Cir. 1983). In other words, "predominance is concerned with whether the putative named plaintiffs can, through their individualized cases, offer proof on a class-wide basis." Hyderi v. Washington Mut. Bank, FA, 235 F.R.D. 390, 398 (N.D. Ill. 2006).

In Counts I and II of his Amended Class Action Complaint, Siegel brings claims under the Illinois Consumer Fraud and Deceptive Business Practices Act ("ICFA"), 815 ILCS 505/1, et. seq., for deceptive and unfair practices. In the present motion, Siegel characterizes his deceptive practices claim as a "material omissions" claim and his unfair practices claim as an "unfair conduct" claim. Nevertheless, the elements of a claim under the ICFA are: (1) a deceptive or unfair act or practice by the defendant; (2) the defendant's intent that the plaintiff rely on the deceptive or unfair practice; and (3) the unfair or deceptive practice occurred during a course of conduct involving trade or commerce. See Robinson v. Toyota Motor Credit Corp., 201 Ill.2d 403, 417, 266 Ill.Dec. 879, 775 N.E.2d 951 (2002); Galvan v. Northwestern Mem'l Hosp., 382 Ill.App.3d 259, 264, 888 N.E.2d 529, 535, 321 Ill.Dec. 10, 16 (Ill.App. Ct. 2008). Moreover, "a private cause of action under ICFA requires a showing ...


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