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In re Hydrogen Peroxide Antitrust Litig. - 552 F.3d 305 (3d Cir. 2008)

Rule:

For purposes of Fed. R. Civ. P. 23(b)(3), because the nature of the evidence that will suffice to resolve a question determines whether the question is common or individual, a district court must formulate some prediction as to how specific issues will play out in order to determine whether common or individual issues predominate in a given case, If proof of the essential elements of the cause of action requires individual treatment, then class certification is unsuitable. Accordingly, a court of appeals examines the elements of the plaintiffs' claim "through the prism" of Rule 23 to determine whether a district court properly certified a class. 

Facts:

The purchasers brought class action suits against chemical manufacturers alleging that the manufacturers had violated 15 U.S.C.S. § 1 of the Sherman Act by engaging in a conspiracy in restraint of trade involving fixing of prices for hydrogen peroxide and related chemical products. The United States District Court for the Eastern District of Pennsylvania granted the purchasers' motion for class certification under Fed. R. Civ. P. 23(a) and (b)(3). The manufacturers petitioned for an interlocutory appeal under Rule 23(f).

Issue:

Was class certification proper?

Answer:

No

Conclusion:

The United States Court of Appeals held that the district court applied incorrect standards in finding that questions of law or fact common to class members predominated over questions affecting only individual members, as required for certification under Rule 23(b)(3). The parties offered conflicting expert testimony regarding whether antitrust impact was capable of proof through evidence common to the class. The district court incorrectly required the purchasers to make only a "threshold showing" that the impact element would predominantly involve generalized issues of proof. Instead, Rule 23 required the resolution of factual disputes concerning the certification requirements by a preponderance of the evidence, upon consideration of all relevant evidence. The district court erroneously failed to weigh the manufacturers' expert's opinion against that of the purchasers' expert in determining whether the Rule 23 requirements were met. Thus, the district court's class certification order was vacated, and the matter was remanded for further proceedings.

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