Illinois Supreme Court 's 'Avery' decision rips through appellate court

Steve Korris Aug. 18, 2005, 12:10pm


Dissenter: Justice Kilbride

Two powerful high court decisions ripped through the appellate court in Mount Vernon Aug. 18 as the Illinois Supreme Court figuratively smashed to splinters the hallowed halls where Abraham Lincoln once toiled.

Illinois Supreme Court Chief Justice Mary Ann McMorrow’s majority opinion in Avery vs. State Farm tore to tatters not only the Fifth District but also the trial judge and the plaintiff’s attorneys.

The Court reversed a Fifth District decision that upheld a Williamson County class action verdict of more than $1 billion against State Farm.

Avery’s suit claimed that State Farm breached contracts and committed consumer fraud by specifying inferior parts for vehicle repairs.

A jury heard the contract claims and awarded the class $243,700,000 for “specification damages,” and $212,440,000 for “installation damages.”

In a simultaneous fraud trial, Williamson County Circuit Judge John Speroni awarded $600 million in punitive damages and $130 million in disgorgement.

The Fifth District rejected the disgorgement and affirmed the rest of the verdict, leaving State Farm liable for $1.056 billion.

McMorrow demolished the verdict with such force that Justices Charles E. Freeman and Thomas L. Kilbride dissented, not so much from the decision as from its tone.

Freeman wrote that the opinion “humiliated plaintiffs’ counsel and demeaned both the trial court and the appellate court. Kilbride joined the dissent.

They complained that the opinion contained intemperate attacks, sarcasm, sheer speculation and unfair innuendo. They declared it unwarranted, inaccurate, hostile and objectionable. They branded the chief judge’s opinion as injudicious.

“I am concerned that today’s opinion sends a message that we, as a court, will employ different standards for cases coming out of the Fifth District on which national attention has been focused in order to reach a desired result,” Freeman wrote.

The majority held that Speroni abused his discretion in certifying the contract claim as a class action, and that he erred in certifying the fraud claim as a class action.

They held that he erred in imposing a uniform interpretation on different State Farm policies and in barring State Farm from telling jurors about differences in its policies and differences in state laws.

“There was no single contract,” McMorrow wrote. “Rather, there were multiple policy forms which differed materially.”

Avery and four other plaintiffs successfully argued at trial that State Farm deceived them by promising parts of “like kind and quality,” but McMorrow scoffed at the logic.

“Common sense indicates that an item that is of ‘like kind and quality’ to another is not that very item,” she wrote.

Plaintiffs also successfully argued at trial that specification of inferior parts caused one kind of damage and installation of inferior parts caused another kind of damage.

McMorrow wrote that specification damages made no sense and had no basis in law. Plaintiffs adopted the theory, she wrote, because if they established damages they could not maintain a class action.

On installation damages, she wrote that evidence was so speculative and uncertain that it constituted a violation of State Farm’s due process rights.

On consumer fraud, she wrote that there was still confusion as to exactly what conduct was at issue.

“Plaintiffs deliberately avoided any theory relating to defective parts at trial because such a theory would have significantly increased their burden of proof,” she wrote. “Such a theory would have rendered class certification less likely…”

“The state’s economy would come to a grinding halt if the sale of anything less than the single, best brand of every consumer good were considered fraudulent,” McMorrow wrote.

Freeman regarded the tone as hostile. He asked where the hostility came from and he answered that the case had been the focus of national attention.

“In my view, today’s opinion appears to be my colleagues’ point of entry into the ongoing national debate concerning class action litigation.”

If the Supreme Court had upheld the Fifth District, attorneys for the plaintiff class would have collected at least $348 million in fees.

The long list of plaintiff lawyers in the Supreme Court record starts with Edward Kionka of Carbondale, Michael Hyman of Chicago and Patricia Murphy of Energy, near Herrin. Murphy is the wife of Patrick Murphy, U. S. district judge in the Southern Illinois District.

The long list of defense lawyers starts with Wayne Whalen, Michelle Odorizzi and William Quinlan, all of Chicago.

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