                           File Name: 09a0021n.06
                           Filed: January 12, 2009
                   NOT RECOMMENDED FOR PUBLICATION

                                      No. 07-6404

                      UNITED STATES COURT OF APPEALS
                          FOR THE SIXTH CIRCUIT




EDMUNDO M. ROMBERIO, THERESA
KEIR, MICHELLE LYNN WASHINGTON,
KAREN M. GATELY, THOMAS ROCCO,
THOMAS P. DAVIS, and MARVINA
JENKINS, individually and on behalf of all
others similarly situated,

      Plaintiffs-Appellees,

v.                                                ON APPEAL FROM THE UNITED
                                                  STATES DISTRICT COURT FOR THE
UNUMPROVIDENT CORPORATION,                        EASTERN DISTRICT OF TENNESSEE
ERISA Benefit Denial Actions,                     AT CHATTANOOGA

      Defendant-Appellant.

                                        /

BEFORE:      CLAY and GRIFFIN, Circuit Judges; and STAFFORD, District
             Judge.*

      STAFFORD, District Judge.

      With leave of this court, the defendant-appellant, UnumProvident Corporation




      *
        The Honorable William H. Stafford, Jr., Senior United States District Judge for
the Northern District of Florida, sitting by designation.
                                            -1-
("Unum"), appeals from the district court's interlocutory order certifying the plaintiffs'

breach-of-fiduciary-duty action as a class action. We now REVERSE.

                                      BACKGROUND

       The case was begun when fifteen individual claimants filed seven class actions in

six federal district courts 1 located in six different circuits.2 The plaintiffs sued Unum, six

of Unum's insuring subsidiaries,3 and two of Unum's corporate officers, asserting breach-

of-fiduciary-duty claims under section 503(a)(3) of the Employment Retirement Security

Act of 1974 ("ERISA"). 29 U.S.C. § 1132(a)(3). With one exception, the plaintiffs were

covered by group long-term disability insurance policies purchased by their individual

employers either from Unum or one of its subsidiaries.4 Some of the plaintiffs claimed

that they were wrongfully denied long-term disability benefits; others claimed that their

long-term disability benefits were wrongfully terminated.

       In 2003, the cases were consolidated in the Eastern District of Tennessee by the


       1
         The Southern District of New York, the District of Massachusetts, the Northern
District of California, the Eastern District of Pennsylvania, the Eastern District of
Tennessee, and the Southern District of Illinois.
       2
           The First, Second, Third, Sixth, Seventh, and Ninth Circuits.
       3
        The insuring subsidiaries are The Paul Revere Life Insurance Company,
Provident Life and Accident Insurance Company, Provident Life and Casualty Insurance
Company, First Unum Life Insurance Company, Unum Life Insurance Company of
America, and Colonial Life & Accident Insurance Company.
       4
        The one exception is Thomas Davis. It is alleged that Davis was insured under a
group long-term disability policy issued by The Prudential Insurance Company, thereafter
The Hartford, neither of which is alleged to be a subsidiary of Unum.
                                              -2-
Judicial Panel on Multidistrict Litigation. Seven of the plaintiffs thereafter settled their

claims, and an eighth plaintiff ultimately received the benefits she was seeking. Those

eight plaintiffs have been dismissed from the action, leaving seven plaintiffs who seek to

proceed with this consolidated action.

A. The Allegations:

       The plaintiffs allege that Unum 5 devised and implemented a corporate-wide scheme

to illegally deny or terminate the long-term disability claims of thousands of disabled

Americans, all in violation of ERISA. Specifically, in their Consolidated Amended Class

Action Complaint, the plaintiffs allege that Unum engages in the following practices:

       a. Instituting targets, budgets, or goals for cost-savings to be attained
       through the denial and termination of claims; the claims do not receive a
       proper review by a fiduciary and are denied or terminated based upon
       UnumProvident's financial targets rather than the medical and vocational
       evidence concerning claimants' disabilities;

       b. Providing financial incentives to in-house physicians who will "rubber
       stamp" previously made business decisions; the physicians thus ignore their
       appropriate ethical obligations and overlook strong medical evidence that
       would ordinarily require a disability claim to be approved.

       c. Implementing of compensation and/or bonus plans that reward Company
       management for denying or terminating as many claims as possible to meet
       special financial goals set by the Company.

       d. Authorizing more senior in-house doctors to alter the written reports of
       other "uncooperative" in-house doctors in order to justify a claim denial or
       termination;



        5
          Unum is appealing on behalf of itself and the other corporate defendants. We
refer to the group of corporate defendants as Unum.
                                             -3-
      e. Creating secret documents for each claim, at the time that claims are filed,
      that, upon information and belief, sets [sic] a target date for cutting off
      future disability payments; these "Duration Management" documents reflect
      business decisions made by non-medical claims personnel as to when the
      company believes claim payments should stop in the future; physicians are
      not involved in creating these secret documents which are kept outside of the
      claims file and withheld from claimants, their attorneys, and reviewing
      courts, and are not produced in discovery during litigation;

      f. Encouraging a game among the in-house physicians called the practice of
      "insurance medicine;" these in-house physicians are prompted, encouraged,
      and pressured into (1) changing their valid medical opinions as to a
      claimant's disability in order to justify a business-driven claim denial; (2)
      closing their eyes to numerous sources of medical evidence that support a
      claimant's disability; (3) remaining quiet about their personal medical
      opinions that require further analysis, review, testing, and follow up that
      would reveal the claimant's obvious disability; and (4) putting "canned"
      statements into their written reports that, on the surface, appear to validate a
      previous decision by claims personnel to terminate ongoing disability
      payments to a claimant or to deny a claim in the first instance.

      g. Recruiting claims personnel who have a reputation for "closing claims"
      (cutting off the ongoing monthly benefits of disabled individuals);

      h. Designing a system in which claimants who have multiple disabling
      conditions will never receive an integrated overview as to how all of the
      disabling conditions combine to disable the claimant; by deliberately
      fragmenting the claim into a number of pieces and preventing a
      comprehensive review of individuals with "co-morbid" conditions, the
      Company ensures that the claimant will not receive a comprehensive and fair
      review of the claim; and

      i. Employing numerous other practices that pressure claims handling
      personnel into causing claims to be denied or terminated without receiving a
      proper review.

      Allegations regarding the seven plaintiffs who remain in the case include the

following:



                                             -4-
       Theresa Keir worked as a financial systems analyst for a real estate company when

she became insured under a group long-term disability policy issued by Unum to her

employer. In March of 2000, Keir claimed disability arising out of breast cancer surgeries

in her left and right breasts, spinal fusions in her low back, removal of a precancerous

ovarian cyst, dermatomyocitis, two herniated discs in her neck, and fibromyalgia. Based

on an in-house review of her medical records, Unum denied Keir's claim to disability

benefits in December of 2000. On appeal, Unum upheld the adverse benefits decision.

       Michelle Lynn Washington was employed as an attorney when she became insured

under a group long-term disability policy issued by Unum. On May 29, 1998, Washington

claimed disability arising from mitral valve prolapse, iron deficiency, anemia,

hypothyroidism, cervical discogenic disease, cervical myofascial pain, L-5 radiculopathy,

fibromyalgia, and depression. Unum paid Washington disability benefits for almost three

years before terminating those benefits in 2001 based upon an in-house medical review

that purportedly revealed that Washington could resume her full-time employment as an

attorney. On Washington's appeal, Unum upheld the termination of benefits.

       Karen Gately was employed as a registered nurse when she became insured under a

group long-term disability policy issued by Unum. Gately claimed disability on or about

August 1, 1995, arising from fatigue, loss of balance, joint pain and swelling, short term

memory loss, and confusion, all arising from lyme disease. After paying disability benefits

to Gately for seventy months, Unum terminated her benefits in November of 2001,



                                             -5-
allegedly because her file contained no objective data regarding her "Epstein Barr virus,

lyme disease, chronic fatigue, and cognitive dysfunction." On review, Unum upheld its

decision to terminated Gately's benefits.

       Thomas Rocco was employed by the Canadian Imperial Bank of Commerce when

he became insured under a group long-term disability policy issued by Unum. On or about

February 2, 2000, Rocco claimed disability arising from symptoms associated with

Meniere's disease, chronic obstructive pulmonary disease, diabetes mellitus II, hearing

loss, and anxiety disorder. Rocco received disability benefits for approximately nine

months before his benefits were terminated in May of 2001. On review, Unum upheld its

decision to terminate Rocco's benefits.

       Thomas P. Davis was employed as a product safety reporting associate when he

became insured under a group long-term disability policy issued by The Prudential

Insurance Company, thereafter The Hartford. Davis claimed disability in July of 1991

arising from labyrinth dysfunction, which produced balance and reading disabilities. The

Prudential/Hartford paid Davis long-term disability benefits until February of 2001, when

Unum—as substituted administrator—terminated his benefits. Those benefits were

reinstated by Unum before the plaintiffs filed their Consolidated Amended Class Action

Complaint in early 2004. Unum contends that Davis has received all benefits to which he

was/is entitled.

       Marvina Jenkins was employed as a bank loan officer when she became insured



                                             -6-
under a group long-term disability policy issued by Unum. In April of 1999, Jenkins

claimed disability arising from cognitive injury due to oxygen deprivation to the brain and

anoxic encephalopathy, producing an IQ of 62. Jenkins received disability benefits until

September of 2000, when Unum terminated her benefits, claiming that she was fit to return

to work. It is not alleged that Jenkins sought review of Unum's decision to terminate her

disability benefits.

       Edmundo M. Rombeiro was employed as a mechanical technician by a

communications company when he became insured under a group long-term disability

policy issued by Unum. On or about May 16, 2000, Romberio claimed disability arising

from the debilitating effects of diabetes, including permanent diabetic neuropathy, blurred

vision, dizziness, severe fatigue, and nerve damage. Unum denied Rombeiro's request for

disability benefits, then informed him that coverage under his policy would be terminated.

It is not alleged that Rombeiro sought review of Unum's decision. On or about October

29, 2001, Unum terminated Rombeiro's coverage.

       In their Consolidated Amended Class Action Complaint, the plaintiffs requested

injunctive and declaratory relief pursuant to 29 U.S.C. § 1132(a)(3).6 In particular, the

plaintiffs requested an order directing Unum to (a) cease the offending practices of



        6
          ERISA section 1132(a)(3) is a catchall remedial provision that authorizes a civil
action "by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which
violates any provision of this subchapter or the terms of the plan, or (B) to obtain other
appropriate equitable relief (i) to redress such violations or (ii) to enforce any provisions
of this subchapter or the terms of the plan."
                                             -7-
wrongfully denying, terminating, or suspending plan benefits; (b) institute, under

appropriate judicial supervision, new procedures that fully comply with ERISA; and (c)

provide a full and fair review—by a receiver and/or special master appointed to serve as a

neutral claims adjustor—"for all claims for benefits under the plan that have been affected

by the offending claims practices and thus wrongly denied." In the alternative, the

plaintiffs requested imposition of a constructive trust over any trust assets controlled by

Unum.

B. Class Certification Proceedings:

        The plaintiffs requested certification of a class defined as follows:

               All plan participants and beneficiaries insured under ERISA[-]
               governed long-term disability insurance policies/plans issued
               by UnumProvident and the insuring subsidiaries of
               UnumProvident throughout the United States who have had a
               long-term disability claim denied, terminated, or suspended on
               or after June 30, 1999 by UnumProvident or one or more of its
               insuring subsidiaries after being subjected to any of the
               practices alleged in the Complaint.

        Unum opposed the motion for class certification, arguing, among other things, that

               (1) the existence of individualized issues on both liability and
               remedy precludes any finding of the homogeneity and
               cohesiveness required for certification under Rule 23(b)(2); (2)
               the immature tort doctrine precludes certification because of
               the very novelty of this [§ ] 502(a)(3) claim; (3) each class
               member who believes his or her claim was wrongfully denied
               has both an economically viable cause of action, and a means
               of bringing it; (4) any payments of benefits they expect as a
               result of this case are not plainly incidental to the declaratory
               and injunctive relief that they claim is the focus of their claims;
               and (5) the incompatibility between these claims and Rule 23

                                               -8-
              certification is highlighted by the defective nature of the class
              definition

In re UnumProvident Corp. ERISA Benefits Denial Actions, 245 F.R.D. 317, 322 (E.D.

Tenn. 2007) (internal quotation marks and citation omitted).

       The district court conducted a hearing on the plaintiffs' motion for class

certification on July 18, 2007. The district court thereafter issued a memorandum opinion,

explaining that, among other things, (1) the plaintiffs' proposed class definition is

sufficiently definite to determine who is or is not a class member; (2) typicality is present

because the plaintiffs' allegations "will involve a determination of whether Unum

implemented a uniform, profit-driven scheme to deny all claims based on financial

concerns, rather than based on the actual merits of the applications for benefits;" (3) the

plaintiffs are representative of the class, all having allegedly been subject to an improper

uniform policy of denying claims based on the company's profits; (4) the plaintiffs' counsel

are qualified and capable of handling the litigation; and (5) the plaintiffs have satisfied the

requirements of Rule 23(b)(2) because the common claim is subject to a single injunctive

remedy—namely an injunction to end or ameliorate Unum's alleged unlawful claims

review policy. Consistent with its findings and conclusions, the district court certified the

class, using the class definition proposed by the plaintiffs.

                                STANDARD OF REVIEW

       This court reviews a district court's grant of class certification for abuse of

discretion. Coleman v. Gen. Motors Acceptance Corp., 296 F.3d 443, 446 (6th Cir. 2002).

                                              -9-
A district court abuses its discretion when it "applies the wrong legal standard, misapplies

the correct legal standard, or relies on clearly erroneous findings of fact." Schachner v.

Blue Cross & Blue Shield of Ohio, 77 F.3d 889, 895 (6th Cir. 1996) (internal quotation

marks and citation omitted). This court will not find an abuse of discretion unless it has a

"definite and firm conviction that the trial court committed a clear error of judgment."

Miami Univ. Wrestling Club v. Miami Univ., 302 F.3d 608, 613 (6th Cir. 2002) (internal

quotation marks and citation omitted). When ruling on a motion for class certification, the

district court must exercise its discretion within the framework of Rule 23.

                                        DISCUSSION

       Before certifying a class action, a district court must conduct a “rigorous analysis"

into whether the requirements of Rule 23 have been satisfied. Gen. Tel. Co. v. Falcon, 457

U.S. 147, 161 (1982); Sprague v. Gen. Motors Corp., 133 F.3d 388, 397 (6th Cir. 1998)

(en banc). Under Rule 23(a), a party seeking class certification must show that (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. In addition to the prerequisites of Rule

23(a), a party seeking class certification must satisfy one of the three subsections of Rule

23(b). Here, the plaintiffs have moved for certification under Rule 23(b)(2), which

demands a showing that "the party opposing the class has acted or refused to act on



                                              -10-
grounds that apply generally to the class, so that final injunctive relief or corresponding

declaratory relief is appropriate respecting the class as a whole." Fed. R. Civ. P. 23(b)(2).

       According to Unum, the district court failed in its responsibility to conduct the

rigorous analysis required for class certification, failing—in particular—in its analysis of

the typicality requirement under Rule 23(a)(2) and the element of cohesiveness under Rule

23(b)(2). Citing Sprague and Reeb v. Ohio Dep't of Rehabilitation and Correction, 435

F.3d 639 (6th Cir. 2006), Unum contends that, as part of its rigorous analysis, the district

court was required to examine the precise nature of the plaintiffs' claims as well as the

proof required to establish those claims. Reeb, 435 F.3d at 644-45 (explaining that

allegations of a "general policy" of discrimination are inadequate to establish entitlement

to class certification; instead, "rigorous analysis" requires precise information about the

incidents, people involved, motivations, and consequences regarding each of the named

plaintiffs' claims); Sprague, 133 F.3d at 397-98 (noting that certification was not proper

merely because the plaintiffs challenged General Motors' system-wide general policy that

changed retirees' health benefits; instead, the district court was required to examine what

the plaintiffs would have to prove to establish their individual claims); see also Fed. R.

Civ. P. 23(c)(1)(B) (requiring a district court, when certifying a class, to define not only

the class but also the "class claims, issues, or defenses").

       While acknowledging that Reeb called for a searching examination of the precise

nature of the plaintiffs' claims, the district court suggested that the lessons of Reeb were



                                              -11-
limited to cases involving generalized claims of employment discrimination. Without

explaining why those lessons would be inapplicable in a case involving the denial of

disability benefits, the district court declined to perform a rigorous analysis of the

plaintiffs' claims, merely stating: "[T]he Court will not need to confront such individual

determinations here." The district court's refusal to look more closely at the plaintiffs'

claims, and also to the defenses that Unum might raise in response to those claims, is

puzzling.

       To prevail on a breach-of-fiduciary-duty claim under ERISA, a plaintiff must

generally prove that the defendant not only breached its fiduciary duty but also caused

harm by that breach. Kuper v. Iovenko, 66 F.3d 1447, 1459 (6th Cir. 1995). A causal

connection between the alleged breach and the alleged harm is thus a necessary element of

an ERISA-participant's breach-of-fiduciary-duty claim. Where, as here, the alleged breach

purportedly results in the wrongful denial or termination of a participant's benefits, the

existence of a causal link between the breach and the harm is particularly dependant upon

the equities of the participant's claim. Absent a showing that benefits were wrongfully

denied, there can be no causal link between an alleged breach and a denial of benefits; and

whether a claim for benefits is wrongfully denied depends on a number of factors peculiar

to the claimant's case. See Hein v. FDIC, 88 F.3d 210, 224 (3d Cir. 1996) (dismissing the

plaintiff's breach-of-fiduciary-duty claim, explaining that "[b]ecause [the plaintiff] was not

entitled to the benefits in the first place, there is no causal link between the alleged breach



                                              -12-
of fiduciary duty by [the defendants] and the denial of benefits to [the plaintiff]").

       Here, the plaintiffs have alleged that Unum breached its fiduciary duties by

wrongfully denying or terminating disability insurance benefits on the basis of a uniform,

profit-driven scheme. Indeed, central to the district court's class certification decision was

its conclusion that "the theory of liability asserted by Plaintiffs in this case does not focus

on individual factors . . . because Plaintiffs have characterized their lawsuit as a challenge

to UnumProvident's uniform policies and practices with respect to reviewing claims."

Dist. Ct. Order of Certification (emphasis in original). That a uniform scheme is alleged,

however, does not mean that a class is easily identified or that a class action is necessarily

appropriate.

       As requested by the plaintiffs, the district court in this case defined the class to

include only those plan participants and beneficiaries whose long-term disability benefits

were denied or terminated "after being subjected to any of the practices alleged in the

Complaint." The district court rejected Unum's argument that, to determine who belongs

in a class so defined, thousands of claim files would have to be examined to see if any of

the alleged wrongful practices were employed in any particular case . While recognizing

that "[i]t may be necessary for the Court to make some factual inquiry," the district court

concluded that the class definition was "sufficiently definite so that it is feasible to

determine who is or is not a class member." The district court relied on Forbush v. J.C.

Penney Co, Inc., 994 F.2d 1101 (5th Cir. 1993) in reaching its conclusion.



                                               -13-
       In Forbush, a retired employee (Forbush) sought class certification in her lawsuit

challenging the mathematical formulae used by J.C. Penney to calculate a retiree's

estimated social security payments. The method used to estimate such payments was

important because, under the company's retirement plans, the pension benefits due to

retirees were offset by the amounts they were expected to receive from the Social Security

Administration. Forbush sought to represent all former and current Penney employees

"whose pension benefits have been or will be reduced or eliminated as a result of the

overestimation of their Social Security benefits." Id. at 1103. The various employees

included in the class were covered by four different pensions plans; and, during the

relevant time period, three different formulae were used to estimate a retiree's social

security benefits. The district court denied Forbush's motion for class certification,

concluding that "each class member's claim will have to be decided on an individual

basis." Id. at 1104. In a two to one decision, the Fifth Circuit reversed, stating: "The

concerns expressed by [the dissent], as well as the district court, regarding the necessity of

individualized determinations are important but not, we believe, dispositive, at least at this

stage of the litigation." Id. at 1106. The court noted that the class could be divided into

sub-classes to resolve any issues arising from the use of three formulae.

       Here, the district court's reliance on Forbush is unmerited. In Forbush, the plaintiff

challenged a very specific practice uniformly applied to a discrete, easily-defined group of

individuals. Indeed, every retiree in the class had his or her pension benefits calculated by



                                             -14-
using one of three mathematical formulae for estimating retirees' social security payments.

If the mathematical formula was improper as used for one retiree, it was improper for

every other retiree whose benefits were determined by application of that formula.

       Unlike the plaintiff in Forbush, the plaintiffs in this case challenge a group of

loosely-defined practices that were not applied uniformly to a discrete, easily-defined class

of individuals. Indeed, the record reveals that Unum pays billions in disability benefits

annually, which means that, despite Unum's alleged profit-driven claim review practices,

many claimants successfully pass through the process and receive disability benefits as a

result. Nor can it be said that all class members whose claims for long-term disability

benefits were denied or terminated would have been entitled to benefits but for Unum's

use of the alleged improper practices. Some of the denials and/or terminations were no

doubt merited for medical reasons. As even a cursory search on Westlaw or Lexis Nexis

will illustrate, many individuals who request disability benefits—whether under ERISA or

social security—are unable to establish entitlement to those benefits. It follows that a class

limited to those persons whose benefits were denied or terminated would necessarily

include many individuals whose claims were properly denied for medical reasons.7

       To be sure, the district court did not define the class as including those participants

whose disability claims were denied or terminated. The court was more specific, defining



        7
        Counsel for the plaintiffs conceded at oral argument that a class of persons
whose benefits were denied or terminated would necessarily include some individuals
whose claims were properly denied for medical reasons.
                                             -15-
the class to include those participants whose claims were denied or terminated "after being

subjected to any of the practices alleged in the Complaint." Such definition, however,

does little to distinguish between the set of individuals whose claims were properly denied

for valid medical reasons and the set of individuals whose claims were improperly denied

for profit-driven reasons. Indeed, as Unum has correctly argued, the only way to

distinguish between the two sets of individuals is to engage in individualized fact-finding,

and the need for such individualized fact-finding makes the district court's class definition

unsatisfactory. See John v. Nat'l Sec. Fire and Cas. Co., 501 F.3d 443, 445 (5th Cir. 2007)

(noting that "[t]he existence of an ascertainable class of persons to be represented by the

proposed class representative is an implied prerequisite of Federal Rule of Civil Procedure

23"); Crosby v. Social Sec. Admin., 796 F.2d 576, 580 (1st Cir. 1986) (explaining that a

class definition should be based on objective criteria so that class members may be

identified without individualized fact finding); 5 James Wm. Moore et al., Moore's Federal

Practice ¶ 23.21[3][c] (3d ed. 2007) (explaining that "[a] class definition is inadequate if a

court must make a determination of the merits of the individual claims to determine

whether a particular person is a member of the class").

       The problem with the class definition, moreover, carries over into problems with

typicality. As the court explained in Sprague, 133 F.3d at 399: "The premise of the

typicality requirement is simply stated: as goes the claim of the named plaintiff, so go the

claims of the class." There must be some connection, in other words, between the merits



                                             -16-
of each individual claim and the conduct affecting the class. Absent such a connection,

there is no basis upon which to fashion class-wide relief. Where a class definition

encompasses many individuals who have no claim at all to the relief requested, or where

there are defenses unique to the individual claims of the class members, Beck v. Maximum,

Inc., 457 F.3d 291, 296 (3d Cir. 2006), the typicality premise is lacking, for—under those

circumstances—it cannot be said that a class member who proves his own claim would

necessarily prove the claims of other class members.

       Relying on a statement taken from Judge Martin's dissenting opinion in Sprague,

the district court began its discussion of typicality by stating: "The test for typicality . . . is

not demanding." Sprague, 133 F.3d at 415 (internal quotation marks and citation omitted).

The district court went on to state that, while typicality is generally lacking when liability

turns on individualized factors, typicality is not lacking in this case because the plaintiffs

"characterized their lawsuit as a challenge to UnumProvident's uniform policies and

practices with respect to reviewing claims." We find the district court's analysis

unpersuasive.

       Here, the class members—who worked in different jobs, had different vocational

skills, had different impairments, and experienced different disability review procedures

managed by different claim representatives—are entitled to relief if, and only if, Unum

wrongfully denied or terminated their benefits. That all of the plaintiffs may have been

subjected to some or all of Unum's alleged wrongful practices does not eliminate the need



                                                -17-
for an individualized assessment as to the ultimate propriety of the benefits decisions

affecting each and every class member. Because individualized assessments are

necessary, it cannot be said that if a named plaintiff succeeds in establishing Unum's

liability for breach of fiduciary duty, "so go the claims of the class." Sprague, 133 F.3d at

399. Typicality is thus lacking.

       In Parke v. First Reliance Standard Life Ins. Co., 368 F.3d 999 (8th Cir. 2004), the

plaintiff alleged that an ERISA-plan fiduciary engaged in a practice of first awarding long-

term disability benefits to a claimant, then terminating or suspending those benefits

without asking for or receiving evidence that the claimant's conditions had changed.

Among other things, the plaintiff sought injunctive relief for other claimants affected by

the same practice. The district court denied the plaintiff's motion for class certification,

finding that the plaintiff could not meet the threshold typicality requirement, given that the

propriety of terminating any other claimant's benefits was dependent on the facts of each

individual case. The Eighth Circuit affirmed, noting that, even if the plaintiff established a

breach causing harm to her, the question of whether a breach caused harm to others

remained "a case-by-case determination." Id. at 1005; see also Holmes v. Pension Plan of

Bethlehem Steel Corp., 213 F.3d 124, 137-38 (3d Cir. 2000) (affirming district court's

denial of class certification for class of beneficiaries whose benefits were wrongfully

delayed because "the issue of liability itself requires an individualized inquiry into the

equities of each claim"). Like the plaintiffs in Parke and Holmes, the plaintiffs in this case



                                              -18-
have failed to demonstrate typicality.

       Even if the plaintiffs were able to demonstrate typicality, they have not shown that

certification under Rule 23(b)(2) is appropriate. That rule provides that a class action may

be maintained if Rule 23(a) is satisfied and "the party opposing the class has acted or

refused to act on grounds that apply generally to the class, so that final injunctive relief or

corresponding declaratory relief is appropriate respecting the class as a whole." Fed. R.

Civ. P. 23(b)(2). A class action under Rule 23(b)(2) is referred to as a "mandatory" class

action because class members do not have an automatic right to notice or a right to opt out

of the class. The defining characteristic of a mandatory class is "the homogeneity of the

interests of the members of the class." Reeb, 435 F.3d at 649. Because homogeneity is

required, unitary adjudication of the claims is feasible without the devices of notice and

opt-out. On the other hand, where individualized determinations are necessary, the

homogeneity needed to protect the interests of absent class members is lacking. Id.

       In response to Unum's argument that a Rule 23(b)(2) class is inappropriate in this

case because of the lack of homogeneity, the plaintiffs suggest that the presence of

individual issues is immaterial because Rule 23(b)(2), unlike Rule 23(b)(3), contains no

predominance requirement.8 They do not address the well-recognized rule that Rule

23(b)(2) classes must be cohesive. See Lemon v. Int'l Union of Operating Eng'rs, 216 F.3d

577, 580 (7th Cir. 2000) (explaining that "Rule 23(b)(2) operates under the presumption


        8
        Rule 23(b)(3) requires that "questions of law or fact common to class members
predominate over any questions affecting only individual members."
                                              -19-
that the interests of the class members are cohesive and homogeneous such that the case

will not depend on adjudication of facts particular to any subset of the class nor require a

remedy that differentiates materially among class members"); Barnes v. Am. Tobacco Co.,

161 F.3d 127, 143 (3d Cir. 1998) (noting that "[w]hile 23(b)(2) class actions have no

predominance or superiority requirements, it is well established that the class claims must

be cohesive"). The Barnes court recognized two reasons why cohesiveness, or

homogeneity, is vital to Rule 23(b)(2) actions:

              First, unnamed members with valid individual claims are
              bound by the action without the opportunity to withdraw and
              may be prejudiced by a negative judgment in the class action.
              Thus, the court must ensure that significant individual issues
              do not pervade the entire action because it would be unjust to
              bind absent class members to a negative decision where the
              class representatives's claims present different individual
              issues than the claims of the absent members present. Second,
              the suit could become unmanageable and little value would be
              gained in proceeding as a class action if significant individual
              issues were to arise consistently.

Id. (internal quotation marks, ellipses, and citation omitted).

       The plaintiffs in this case request, among other things, both imposition of a

constructive trust as well as entry of an order requiring Unum "to provide a full and fair

review . . . of all claims for benefits under the plan that have been denied." The plaintiffs

do not explain how a constructive trust could be imposed without individualized review of

every claim that was denied. Nor do they explain how the court could, if it ordered "a full

and fair review . . . of all claims for benefits under the plan that have been denied," avoid



                                              -20-
exposing Unum to what Unum describes as "a one-way ratchet where [Unum] can lose but

never win." As Unum correctly asserts, Unum would have to provide the very relief

requested (i.e., re-review) in order to determine whether any individual was, in the first

instance, a class member, and, in the second instance, entitled to relief for an improper

denial or termination of benefits. Class certification under the circumstances was an abuse

of discretion.

                                      CONCLUSION

       For the foregoing reasons, we will REVERSE the district court's order of

certification.




                                             -21-
       CLAY, Circuit Judge, dissenting. This case is well-suited for class certification

because it alleges a common course of wrongful conduct that warrants injunctive relief for

the class as a whole. Today’s result, which will require that Plaintiffs raise their claims in

a series of individual but related lawsuits, will result in a waste of economic and judicial

resources that will do very little to address the alleged system-wide directives and policies

of Unum. The majority, with little focus on the deferential standard of review that is

required in these matters, has grossly misapplied this Court’s holdings in cases such as

Reeb and Sprague, and has failed to apply a number of pertinent cases that support the

district court’s grant of class certification. For these reasons and others, I would affirm the

district court’s grant of class certification, and I respectfully dissent.

                                                I.

       Before addressing the majority opinion, it would be helpful to briefly review the

background of this case and Unum’s responsibilities under ERISA. This case originated

as a series of cases which were referred to the district court by a Judicial Panel on

Multidistrict Litigation. On the basis of papers filed and a hearing held, the panel found

that consolidated proceedings were appropriate because (1) the underlying actions

involved common allegations that Unum engaged in improper claims handling practices in

furtherance of a company-wide effort to reduce costs and inflate revenues; (2) the actions

involved common questions of fact; and (3) litigation could be expected to focus on a

significant number of common events, defendants, and/or witnesses.



                                               -22-
       The named plaintiffs in the consolidated case are long-term disability insurance

claimants, each of whom alleges that he or she was improperly denied claim benefits by

Unum. Collectively, Plaintiffs allege that Unum and its subsidiaries devised and

implemented an elaborate scheme to illegally deny or terminate the long-term disability

claims of thousands of disabled Americans, and brought this action to “stop [Unum’s]

illegal and alarming practices and to ensure that past, current, and future victims obtain a

full and fair review of their claims.” More specifically, Plaintiffs claim that Unum

fiduciaries systematically: (1) provide financial incentives to physicians who will ‘rubber

stamp’ previously made business decisions in derogation of medical evidence and their

ethical obligations; (2) authorize senior in-house physicians to alter the written reports of

“uncooperative” physicians in order to justify a claim denial or termination; (3) deny or

terminate claims without proper review by a fiduciary based on financial targets rather

than the medical and vocational evidence concerning claimants’ disabilities; (4) create

‘Duration Management’ documents that set target dates for cutting off claims and are

withheld from claimants, attorneys, and reviewing courts; and (5) pressure physicians to

change their medical opinions as to a claimant’s disability in order to justify a business-

driven claim denial. Plaintiffs argue that these practices constitute a beach of fiduciary

duty under ERISA and the regulations promulgated thereunder.

       ERISA provides that “a fiduciary shall discharge his duties with respect to a plan

solely in the interest of the participants and beneficiaries and– (A) for the exclusive



                                              -23-
purpose of: (i) providing benefits to participants and their beneficiaries; and (ii) defraying

reasonable expenses of administering the plan . . . .” 29 U.S.C. § 1104. The “minimum

requirements for employee benefit plan procedures” under ERISA prohibit administration

of claims procedures in a way that “unduly inhibits or hampers” the processing of claims

for benefits. 29 C.F.R. § 2560.503-1(a)-(b)(3).

       Interpreting these provisions, this Court has held that ERISA imposes high

standards of fiduciary duty upon plan administrators which encompass three components:

               The first is a “duty of loyalty” pursuant to which “all

               decisions regarding an ERISA plan ‘must be made with an

               eye single to the interests of the participants and

               beneficiaries.’” The second . . . imposes “an unwavering

               duty” to act both “as a prudent person would act in a similar

               situation” and “with single-minded devotion” to those same

               plan participants and beneficiaries. Finally, an ERISA

               fiduciary must “‘act for the exclusive purpose’” of providing

               benefits to plan beneficiaries.




Kuper v. Iovenko, 66 F.3d 1447, 1458 (6th Cir. 1995) (internal citations omitted). If a

fiduciary fails to meet these standards, he or she may be held personally liable for any

losses to the plan that result from his breach of duty. Id. (citing 29 U.S.C. § 1109(a)). In



                                              -24-
addition, plan members are statutorily authorized to seek injunctive relief to enjoin

prohibited practices. See 29 U.S.C. § 1132(a) (“A civil action may be brought . . . by a

participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any

provision of this title or the terms of the plan, or (B) to obtain other appropriate equitable

relief (i) to redress such violations or (ii) to enforce any provisions of this title or the terms

of the plan . . . .”).

        If proven, Plaintiffs’ allegations of Unum’s systemic claims practices would

certainly establish a violation of the terms of ERISA.9 The salient question, therefore, is

whether these claims must be brought as individual lawsuits by a series of claimants, or

whether the claims can properly be raised under the auspices of a class action.

                                                      II.

        Inexplicably, given the nature of this case, the majority offers little analysis of this

Court’s holdings regarding the propriety of raising “course of conduct” cases as class

actions. I will begin with this.

        We recently advised that “cases alleging a single course of wrongful conduct are

particularly well-suited to class certification . . . .” Powers v. Hamilton County Pub.

Defender Comm’n, 501 F.3d 592, 619 (6th Cir. 2007). This proposition has been repeated



         9
         A fiduciary who issued corporate-wide directives to override or modify medical
 decisions based on predetermined target dates and financial incentives would plainly
 not be acting “with an eye single to the interests of” plan participants and “for the
 exclusive purpose” of providing benefits to plan participants. See Kuper, 66 F.3d at
 1458.
                                               -25-
consistently by this Court. See Olden v. Lafarge Corp., 383 F.3d 495, 508 (6th Cir. 2004)

(case suited to class certification because plaintiffs raised common allegations which

would allow the court to determine liability for the class as a whole); Sterling v. Velsicol

Chem. Corp., 855 F.2d 1188, 1197 (6th Cir. 1988) (acknowledging an “increasingly

insistent need” to certify class actions for lawsuits arising out of a “single course of

conduct”); Senter v. GMC, 532 F.2d 511, 525 (6th Cir. 1976) (finding that “[l]awsuits

alleging class-wide discrimination are particularly well suited for 23(b)(2) treatment since

the common claim is susceptible to a single proof and subject to a single injunctive remedy.”).

       The rationale supporting these holdings is well-justified. In cases alleging a

common course of prohibited conduct, “the class-action device saves the resources of both

the courts and the parties by permitting an issue potentially affecting every [class member]

to be litigated in an economical fashion . . . ." Gen. Tel. Co. of the Southwest v. Falcon,

457 U.S. 147, 155 (1982) (quoting Califano v. Yamasaki, 442 U.S. 682, 700-701 (1979)).

In this context, class actions serve to achieve economies of time, effort, and expense. See

In re American Medical Sys., 75 F.3d 1069, 1084 (6th Cir. 1996).

       Moreover, in cases where the optimum result for any one plaintiff would be more

than consumed by the costs, class actions may provide the only method of vindicating the

rights of individuals who otherwise could not afford the litigation. Deposit Guar. Nat’l

Bank v. Roper, 445 U.S. 326, 338 (1980). It is in this light that the Supreme Court

observed that a district court’s ruling on the class certification issue is often “the most



                                              -26-
significant decision rendered in [ ] class-action proceedings” because when it is not

economically feasible to obtain relief by filing a multiplicity of individual suits for

damages, “aggrieved persons may be without any effective redress unless they may

employ the class-action device.” Id. at 339.

       The purposes and benefits of class actions are particularly on point in the instant

case. It is not practical or feasible for any one disability claimant to bear the cost of

litigating the systematic and corporate-wide claims procedures and directives of a large,

national disability provider such as Unum. The costs of conducting discovery regarding

these procedures would undoubtedly exceed the damages any one plaintiff could hope to

recover, and it would be a waste of economic and judicial resources to engage in

duplicitous litigation of these common issues. Moreover, a relatively small award in favor

of a given plaintiff would do nothing to address or deter the systemic processes of Unum.

In such a case, class certification is the proper and practical way to proceed.

       The majority takes issue with the fact that in any given plaintiff’s case,

individualized issues are present and a detailed review of a plaintiff’s disability claim may

determine that “the claim [was not] wrongfully denied.” Slip op. at 12 (emphasis in

original). However, if it is proven that Unum engages in systematic and prohibited claims

practices, a plaintiff is statutorily entitled to injunctive relief. See 29 U.S.C. 1104(a)(1)(A)

(fiduciary must discharge his duties for the exclusive purpose of providing benefits to

participants and their beneficiaries); 29 U.S.C. § 1132(a) (a civil action may be brought by



                                               -27-
a plan participant to enjoin any act or practice which violates any provision of the plan).

       Moreover, under the majority’s reasoning, class actions would be prohibited in a

wide variety of course of conduct cases that litigate issues of general liability before

addressing individualized issues and damages. There are many such cases. In a toxic tort

action, for example, the first order of business might be to determine that a corporation

wrongfully disposed of an environmental toxin and created an environmental hazard.

After this issue is resolved, individual plaintiffs would have to prove that the toxin caused

injury their individual cases. In such cases, it may ultimately be determined that a given

plaintiff’s injuries were feigned, negligible or attributable to other sources, but so long as

the named plaintiffs and the certified class proffered a cognizable claim of wrongdoing,

the absence of damages in connection with one plaintiff’s claim does not mean the case

was not appropriately tried as a class action. See, e.g., Sterling, 855 F.2d at 1197

(affirming class certification and holding that the presence of questions peculiar to each

individual member of the class was no bar when liability arose from a single course of

conduct).10 Class certification is equally appropriate here, where Unum’s system-wide

claims practices and policies are alleged to be common and can be litigated before

individualized questions are addressed.



        10
           Securities fraud and consumer protection cases also frequently address general liability
issues before they move to individualized findings. See, e.g., Mayer v. Mylod, 988 F.2d 635, 640
(6th Cir. 1993) (in a securities fraud action, class action certification was appropriate even
though some investors made money and some lost money, because questions of liability were
common to all class members regardless of their level of damages).
                                               -28-
       Similarly, in Title VII “pattern or practice” cases, courts routinely proceed by

examining allegations that a company engaged in a common pattern or practice of

discrimination, and approach individualized relief in a separate process. See Franks v.

Bowman Transportation, 424 U.S. 747, 772 (1975) (establishing the “Franks model”

where plaintiffs must demonstrate the existence of a discriminatory hiring pattern or

practice, and the burden then shifts to the defendants to prove that individuals were not in

fact victims of discrimination).11 In Cooper v. Federal Reserve Bank, the Supreme Court

observed that “[w]hile a finding of a pattern or practice of discrimination itself justifies an

award of prospective relief to the class, additional proceedings are ordinarily required to

determine the scope of individual relief for the members of the class.” 467 U.S. 867, 875-

76 (1984). In such cases, as here, it is not known at the onset of litigation whether an

individual plaintiff has suffered discrimination that would warrant individualized relief:

the primary and first issue to be addressed is the system-wide misconduct by the

defendant.

       Affirmative action cases also bear similarities to the instant case. In such cases,

courts commonly begin by addressing common questions of liability and then move to

questions peculiar to each individual class member. In Grutter v. Bollinger, for example,



        11
          The Franks model of litigating pattern or practice cases continues to apply.
See Int’l Bhd. of Teamsters v. United States, 431 U.S. 324, 328 (1977) (applying the
Franks model); McKennon v. Nashville Banner Publ. Co., 513 U.S. 352, 358 (U.S.
1995) (citing Franks and Teamsters with approval); Reeb v. Ohio Dep’t of Rehab and Corr.,
435 F.3d 639, 658 (6th Cir. 2006) (citing Teamsters and Franks as authority).
                                              -29-
the district court granted class certification to individuals of specified races who were

denied admission to the law school, and bifurcated the trial into separate liability and

damages phases. 539 U.S. 306, 317 (2003). It goes without saying that any individual

class member might not have been admitted to the law school, even in the absence of

allegedly prohibited practices of the university. In that case, as here, to establish whether

any individual plaintiff was entitled to individual damages, a detailed review of the

individual’s file would be required. But there, as here, the defendant’s wrongful practices,

if proven, might justify injunctive relief for the class as a whole and “the mere fact that

questions peculiar to each individual member of the class remain after the common

questions of the defendant’s liability have been resolved does not dictate the conclusion

that a class action is impermissible.” Powers, 501 F.3d at 619.

       To be sure, there are “course of conduct” cases that are not suited for class

certification. The most common of these are cases where: (1) injuries arise from

individualized or isolated incidents of wrongdoing that do not apply to the class as a

whole; or (2) issues of individual compensatory damages predominate. In Falcon, for

example, the Supreme Court rejected the plaintiffs’ claim that there was a policy of

system-wide discrimination because the court found that the plaintiffs improperly

generalized the experiences of discrete individuals who were subjected to discriminatory

actions. 457 U.S. at 159. The Court explained that “[i]f one allegation of specific

discriminatory treatment were sufficient to support an across-the-board attack, every Title



                                              -30-
VII case would be a potential companywide class action.” Id. The instant case does not

raise the same concerns. Here, Plaintiffs are not using the experiences of the few to

establish a system-wide policy; instead, the heart of their claim is that Unum has employed

corporate-wide directives that claims must be denied based on financial targets. Any

individualized grievances flow from that overarching policy.

       Class action designation is also inappropriate in course of conduct cases where

issues of individual compensatory damages predominate. In Reeb, for example, this Court

held that the district court abused its discretion by certifying a class under Rule 23(b)(2)

because claims for individual compensatory damages predominated over declaratory or

injunctive relief. 435 F.3d at 650-51 (expressing concern that highly individualized

damages “counseled strongly” against certifying the class, but acknowledging that it would

be appropriate for the plaintiffs to bring the case “in an action under Rule 23(b)(2) for

declaratory or injunctive relief . . . .”) That is exactly what is presented here: Plaintiffs

seek injunctive relief as the primary form of relief, and individualized damages can be

addressed at a later stage of the proceedings.

       In sum, because this course of conduct case centers upon Unum’s common and

systematic claims practices, and because a finding of general liability would justify class-

wide injunctive relief, class certification is appropriate.

                                               III.

       In discussing the majority’s conclusions to the contrary, first and foremost, we must



                                               -31-
recognize that this Court is obligated to provide “substantial deference” to a court’s

decision to grant class action certification inasmuch as a district court possesses the

“inherent power to manage and control its own pending litigation.” Reeb, 435 F.3d at 643.

The district court’s decision is subject to a “very limited review” and should be reversed

only upon a “strong showing that the . . . decision was a clear abuse of discretion.” Olden,

383 F.3d at 507 (internal citation omitted).

       As the majority states, a plaintiff seeking class certification is required to satisfy the

prerequisites of Rule 23(a) – numerosity, commonality, typicality, and fair representation –

along with the relevant subsection of Rule 23(b), which, in this case, requires that “the

party opposing the class has acted or refused to act on grounds that apply generally to the

class, so that final injunctive relief or corresponding declaratory relief is appropriate

respecting the class as a whole[.]” F ED R. C IV. P. 23(b)(2).

       Defendants concede that the requirements of numerosity and commonality are met,

but argue that typicality and cohesiveness are lacking. The majority agrees, and also

asserts that Plaintiffs have failed to show “a causal connection between the alleged breach

and the alleged harm.” Slip. op. at 11-12. I disagree, and will address these issues in turn.

                                               A.

       The first contested issue is typicality. To establish this prerequisite, Plaintiffs must

demonstrate that “the claims or defenses of the representative parties are typical of the

claims or defenses of the class.” F ED. R. C IV. P. 23(a)(3). A claim is typical if “it arises



                                               -32-
from the same event or practice or course of conduct that gives rise to the claims of other

class members, and if his or her claims are based on the same legal theory.” Beattie v.

CenturyTel, Inc., 511 F.3d 554, 561 (6th Cir. 2007) (quoting American Med. Sys., 75 F.3d

at 1082). This Court has explained that “[t]ypicality determines whether a sufficient

relationship exists between the injury to the named plaintiff and the conduct affecting the

class, so that the court may properly attribute a collective nature to the challenged

conduct.” Sprague v. GMC, 133 F.3d 388, 399 (1998). For the district court to conclude

that the typicality requirement is satisfied, “a representative’s claim need not always

involve the same facts or law, provided there is a common element of fact or law.” Beattie,

511 F.3d at 561 (quoting Senter, 532 F.2d at 525 n.31).

       Here, as discussed above, Plaintiffs’ claims are typical because they arise from

corporate-wide claims directives and procedures, which constitute a prohibited “course of

conduct” and a “common element of fact or law,” as required in Beattie, 511 F.3d at 561.

If Plaintiffs are able to prove that Unum has established corporate practices directing

personnel to disregard medical diagnoses to meet predetermined financial targets, those

findings advance the claims of all class members and would warrant an injunction

prohibiting the illegal practices. Individualized damages may remain, but this does not

counsel against class certification.

       The majority disagrees, relying upon misguided interpretations of Reeb and

Sprague to support a conclusion that typicality is lacking. The majority cites Reeb, 435



                                             -33-
F.3d at 644-45, for the proposition that allegations of a “general policy” of discrimination

are inadequate to establish entitlement to class certification because courts are required to

conduct a rigorous analysis of the “incidents, people involved, motivations and

consequences regarding each of the named plaintiffs’ claims.” Slip. op. at 11. However,

the Reeb Court’s admonition was based upon a finding that there was an abundance of

individualized issues of proof and damages present in that case.

       The Reeb Court relied upon Falcon, 457 U.S. 147, for the proposition that

resolution of employment discrimination claims would “require proof that particular

managers took particular employment actions and that either the managers were motivated

by a discriminatory animus or the actions resulted in a disparate impact upon the class.”

Reeb, 435 F.3d at 644. The Court expressed concern that the plaintiffs were using the

experiences of the few to allege an “abstract policy” of discrimination, and expressed

concern that the discrimination alleged could affect many different aspects of employment,

such as hiring, firing, promoting, giving benefits, providing vacation time, or delegating

work assignments. Id. at 644-45.

       In contrast, here, Plaintiffs allege that Unum fiduciaries employ systemic policies

and practices that instruct medical and claims personnel to deny claims based on pre-

established financial targets. Unlike discriminatory hiring, firing, and promotion practices

that turn upon the statements and actions of specific managers to specific employees,

Plaintiffs here are challenging specific practices and directives that apply to claims



                                             -34-
procedures across the board.

       Moreover, Reeb is distinguishable because the Reeb Court was particularly

concerned with the nature of the damages that were sought. The Reeb plaintiffs asserted a

wide variety of claims, and requested $2 million in compensatory damages and $3 million

in punitive damages. Id. at 642. The Court expressed concern that these damages included

“future pecuniary losses, emotional pain, suffering, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.” Id. at 646. The Court noted that the

plaintiffs sought an injunction but that “they did not specify the conduct they sought to

have enjoined.” Id. at 640. This scenario offers a stark contrast to the present case, where

Plaintiffs seek injunctive relief as the primary form of relief and are specific about the

policies they seek to enjoin.

       Most importantly, perhaps, the Reeb Court expressly advised that it would have

been appropriate for the Reeb plaintiffs to bring the case as a class action under Rule

23(b)(2) for declaratory or injunctive relief. Id. at 651 (“We emphasize, however, that this

holding does not foreclose all Title VII class actions. Plaintiffs now have the choice of

proceeding . . . in an action under Rule 23(b)(2) for declaratory or injunctive relief . . . .”).

This is precisely the type of claim that is filed here. In this regard, Reeb is not just

inapposite; it actually supports Plaintiffs’ argument for class certification.

       The majority also relies on Sprague, 133 F.3d at 397-98, for the proposition that

class certification is not proper if the plaintiff can prove his own claim but not prove the



                                               -35-
claims of other class members. Slip op. at 16-17. This case, if possible, is even more

inapposite. The Sprague plaintiffs requested relief for the defendants’ violations of

ERISA based on a bilateral contract theory and on an estoppel theory, and the Court found

that the claims lacked typicality because success on either theory would require

individualized proofs. 133 F.3d at 398. Under the bilateral contract theory, the district

court would have to consider the a wide variety of documents signed by the plaintiffs;

under the estoppel theory, the court would need to determine “what statements were made

to a particular person, how the person interpreted those statements, and whether the person

justifiably relied on the statements to his detriment.” Id. This Court noted that “because

of their focus on individualized proof, estoppel claims are typically inappropriate for class

treatment” and concluded that “because each plaintiff’s claim depended upon facts and

circumstances peculiar to that plaintiff, class-wide relief was not appropriate.” Id. Here,

in contrast, Plaintiffs’ claims focus on system-wide policies and directives. This is not a

case like Sprague that had no common thread of liability. Although individualized

damages may exist for the class members, this issue can be resolved after issues of general

liability and injunctive relief are resolved.

       The majority’s faulty logic, and its misreading of Sprague, is perhaps clearest in the

following statement: “That all of the plaintiffs may have been subjected to some or all of

Unum’s alleged wrongful practices does not eliminate the need for an individualized

assessment as to the ultimate propriety of the benefits decisions affecting each and every



                                                -36-
class member. Because individualized assessments are necessary, it cannot be said that if

a named plaintiff succeeds in establishing Unum’s liability for breach of fiduciary duty,

‘so go the claims of the class.’” Slip op. at 17-18 (quoting Sprague, 133 F.3d at 399).

This is perplexing. If a plaintiff proved that Unum engaged in systemic and illegal claims

processing practices that harmed him as well as those similarly situated, he would certainly

have proven that injunctive relief was warranted for the class. Moreover, if the majority’s

reading were applied across the board and a plaintiff had to prove all plaintiffs’ claims by

proving his own claim, class certification would be precluded in a wide variety of cases,

including the toxic tort, Title VII, and affirmative action scenarios discussed above.

       The majority reads Sprague too broadly. The statement that “as goes the claim of

the named plaintiff, so go the claims of the class,” 133 F.3d at 399, stands for the

proposition that any one plaintiff, in pursuing his own claims, must advance the interests

of other class members. The Sprague Court, in the quoted passage, was actually

paraphrasing its earlier statement that “[a] necessary consequence of the typicality

requirement is that the representative’s interests will be aligned with those of the

represented group, and in pursuing his own claims, the named plaintiff will also advance

the interests of the class members.” Id. (quoting American Med. Systems, 75 F.3d at 1082)

(emphasis added). The Sprague Court went on to say that “in pursuing their own claims,

the named plaintiffs could not advance the interests of the entire early retiree class. Each

claim, after all, depended on each individual’s particular interactions with GM . . . .” Id.



                                             -37-
(emphasis added).

       Consequently, Sprague does not support the majority’s conclusion that typicality is

lacking. Instead, it supports the opposite conclusion: because Plaintiffs have established

that the litigation of their cases would advance the interests of the class, they satisfy the

requirement of typicality.

       Perhaps because of the majority’s undue focus on generalized admonitions in cases

such Sprague and Reeb, the majority fails to acknowledge that courts have granted class

certification in a number of cases involving claims that a corporation engaged in a

wrongful practice impacting all class members. In Bittinger v. Tecumseh Prods. Co., 123

F.3d 877, 885 (6th Cir. 1997), for example, this court affirmed the district court’s class

certification decision in case governed by ERISA, over arguments that claims would be

subject to varied defenses and arguments that the class members suffered varying levels of

injury. This Court explained:

               Though the level of claimed injury may vary throughout the

               class -- a common feature of class actions routinely dealt with

               at a remedial phase -- the basic injury asserted is the same:

               Tecumseh violated the terms of the collective bargaining

               agreements by unilaterally terminating fully-funded lifetime

               benefits. As noted above, those differences that exist --

               including the individual estoppel claims -- can be dealt with



                                               -38-
               through methods other than denial of class certification, at a

               later stage in the proceeding.




Id. In that case, we aptly noted that “the plaintiffs’ evidence appears to follow a pattern,

and the people they claim made the representations are largely the same people.” Id. at

884. Here too, the evidence of alleged wrongdoing follows pattern; in this case, the

alleged pattern is one of uniform and prohibited claims procedures. Plaintiffs’ claims, like

the claims in Bittinger and Beattie, satisfy the typicality requirement because they arise

“from the same event or practice or course of conduct that give[] rise to the claims of other

class members, and . . . are based on the same legal theory.” Beattie, 511 F.3d at 561.

       Although we are at an early stage of the proceedings, it is noteworthy that Plaintiffs

provide reason to believe that they could succeed in establishing that Unum’s alleged

practices exist. Other plaintiffs have succeeded in similar cases involving the same

defendants. Recently, in the matter of Merrick v. Paul Revere, a district court in Nevada

issued an order upholding a jury’s award of punitive damages to plaintiffs in a trial

involving Defendants in the instant case.12 See Merrick v. Paul Revere, No. 2:00-cv-

00731 (D. Nev. filed Nov. 14, 2008). In the district court’s findings of fact, the court



        12
          The defendants in Merrick were The Paul Revere Life Insurance Company and
UnumProvident Corporation. Merrick v. Paul Revere, No. 2:00-cv-00731, slip op. at 1.
The court’s order explains that in 1996-1997, Provident and Paul Revere merged with
Unum to form UnumProvident. UnumProvident then entered into an agreement in
which it took over all responsibility for handling Revere claims. Id. at 8.
                                                -39-
stated that the plaintiff had presented “overwhelming” testimonial and documentary

evidence of “the existence of targets and goals to terminate [disability] claims” that were “

. . . communicated to claim handling employees by such means as e-mails, and weekly

Staff Meetings.” Slip op. at 4-5. The court found that “[b]ased on the credible testimony

about targets and goals, documents, and the duration of Defendants’ misconduct, there is

every reason to conclude that Defendants gained well in excess of a billion dollars as a

result of their claims handling misconduct.” Id. at 12.

       In another case affirming a jury’s award of punitive damages, the Ninth Circuit

concluded that evidence existed that the same defendants “employed policies to achieve

net termination ratios” and “had a conscious course of conduct firmly grounded in

established company policies that disregarded the rights of insureds.” Hangarter v.

Provident Life and Accident Ins. Co., 373 F.3d 998, 1014 (9th Cir. 2004).13 These findings

support an argument that Plaintiffs’ claims are more than unfounded allegations and that

the alleged practices they describe are systemic.14



        13
        The defendants in Hangarter were Provident Life and Accident Insurance
Company, The Paul Revere Life Insurance Company, and UnumProvident Corporation.
373 F.3d 998.
        14
          The claims in Merrick and Hangarter were raised by individual plaintiffs, but the
courts’ findings of fact, combined with large punitive damage awards that ranged from
$5 to $8 million, indicate that the verdicts sought to target the deliberate and systemic
practices of the defendants. See Merrick, No. 2:00-cv-00731; Hangarter, 373 F.3d 998.
The availability of individual suits does not guarantee that the concerns of all potential
class members will be protected, particularly when individual plaintiffs may not have the
resources to bring a claim. In these circumstances, injunctive relief in a class action
context is a particularly appropriate tool.
                                             -40-
       In sum, here, where the practices alleged are corporate-wide and purportedly affect

all class members, the claims satisfy the requirements of typicality. In such a case, there is

no sound reason to proceed by requiring individual plaintiffs to advance the claims and try

common issues of fact separately and repetitively.

                                                B.

       The majority next asserts that the claims do not satisfy the requirements of Rule

23(b)(2), which requires that “the party opposing the class has acted or refused to act on

grounds that apply generally to the class, so that final injunctive relief or corresponding

declaratory relief is appropriate respecting the class as a whole[.]” F ED. R. C IV. P.

23(b)(2).

       Citing authority from the Third and Seventh Circuits, the majority asserts that there

is a “well-recognized rule” that classes certified under Rule 23(b)(2) must be cohesive and

homogeneous. Pointing to Reeb, 435 F.3d at 649, my colleagues declare that “when

individualized determinations are necessary, the homogeneity needed to protect the

interests of absent class members is lacking.” Slip op. at 19. As discussed above, Reeb is

not fatal to Plaintiff’s case, and there is a long line of cases that establish that

individualized issues may be determined after general issues of liability are resolved.15


        15
          This Court has affirmed that “the mere fact that questions peculiar to each individual
member of the class remain after the common questions of the defendant’s liability have been
resolved does not dictate the conclusion that a class action is impermissible.” Powers, 501 F.3d
at 619. This Court also advised that it is not uncommon for the level of claimed injury to vary
throughout the class; this is “a common feature of class actions” that can be dealt with through
“methods other than denial of class certification, at a later stage in the proceeding.” Bittinger,
                                               -41-
       The majority opinion discusses reasons why “cohesiveness, or homogeneity is vital

to Rule 23(b)(2) actions[,]” stating that there is the potential that unnamed class members

will be prejudiced by a negative judgment in the class action, and that individual issues

may pervade the action, making the suit unmanageable. Slip. op. at 20. But the majority’s

analysis stalls and does not state why the requirement of cohesiveness is lacking here.

This lapse is telling; cohesiveness is plainly present in this case, where Plaintiffs state a

common theory of wrongdoing and seek injunctive relief that would benefit class members

across the board. See Beattie, 511 F.3d at 564 (finding that the proposed class was

sufficiently cohesive in a consumer protection claim because the issues in that case were

“subject to generalized proof, and thus applicable to the class as a whole” and because

such issues “predominate[d] over those issues that [we]re subject only to individualized

proof.”) (citations omitted).

       Moreover, the majority appears to take issue with the relief that is sought. Glossing

over the fact that the primary form of relief requested is injunctive, the majority states that

Plaintiffs request a constructive trust and an order requiring Unum to provide a full and

fair review of claims for benefits that have been denied. My colleagues then conclude that

this relief would expose Unum to a “one-way ratchet” where Unum would have to provide

re-review of claims to determine if a class member was entitled to relief for an improper

denial or termination of benefits.



123 F.3d at 885.
                                              -42-
Plaintiffs seek the following forms of relief:

        [1.] Awarding plaintiffs and the Class declaratory relief

        determining the illegality of the conduct alleged and

        injunctive relief whereby UnumProvident and its subsidiaries

        are ordered to immediately cease. . . engaging in the offending

        practices delineated herein;




        [2.] Awarding plaintiffs and the Class equitable relief

        whereby Unum Provident and the subsidiaries are ordered to

        institute, under the supervision of the Court, new, national

        procedures that are in full compliance with ERISA;




        [3.] Awarding plaintiffs and the Class equitable relief

        appointing a receiver and/or special master to serve as a

        neutral claims adjustor and assume the role of responsibility

        for responding to, acting upon, and making determinations

        pertaining to claims by plaintiffs and the Class and to provide

        a full and fair review, as required by 29 U.S.C. §1133(2) of all

        claims for benefits under the plan that have been denied;




                                       -43-
               [4.] In the alternative, awarding plaintiffs and the Class a

               permanent injunction enjoining [the named defendants] from

               serving as claim fiduciaries and an the [sic] imposition of a

               constructive trust over the any [sic] trust assets controlled by

               [said defendants] [pursuant to] 29 U.S.C. §1109; [and]




               [5.] Awarding plaintiffs and the Class other appropriate

               relief[.]




(J.A. 38.)

       As the request for relief indicates, the imposition of a constructive trust is only one

alternative form of relief. Plaintiffs also request injunctive and declaratory relief enjoining

Unum from engaging in the specified prohibited practices, which are more general forms

of relief that apply to the class as a whole.

       Moreover, it would be perfectly acceptable for the district court to address

individualized damages in a separate proceeding. There are a “number of management

tools available to a district court to address any individualized damages issues,” such as

“bifurcating liability and damage trials, or appointing a magistrate judge or special master

to preside over individual damages proceedings.” Beattie, 511 F.3d at 562. This is not an

uncommon practice. “By bifurcating issues like general liability or general causation and



                                                -44-
damages, a court can await the outcome of a prior liability trial before deciding how to

provide relief to the individual class members.” Olden, 383 F.3d at 509 (citations

omitted); see also Fed. R. Civ. P. 23(c)(4) (“When appropriate, an action may be

maintained as a class action with respect to particular issues.”); Reeb, 435 F.3d at 658

(suggesting that bifurcated phases of the class action could help separate issues of class-

wide claims of discrimination from individual employment decisions).16 Consequently,

the majority’s concerns regarding the form of relief sought are unwarranted.

                                              C.

       Finally, the majority asserts that class certification is inappropriate because, under

Kuper, 66 F.3d at 1459, “a causal connection between the alleged breach and the alleged

harm is . . . a necessary element of an ERISA-participant’s breach-of-fiduciary-duty

claim.” Slip op. at 12. The majority reasons that “whether a claim for benefits is

wrongfully denied depends on a number of facts peculiar to the claimant’s case” and that

“absent a showing that benefits were wrongfully denied, there can be no causal link

between an alleged breach and a denial of benefits.” Slip. op. at 12 (emphasis in original).

This analysis is misguided for several reasons.

       First, and importantly, the Kuper Court did not find that plaintiffs must provide a


        16
          Insofar as the Defendants claim that an individual may not have a medical
condition warranting disability benefits, Unum’s records are the most relevant items of
proof. If the refusal of benefits was based on permissible factors, such as the lack of a
qualifying medical condition, Unum and its agents know best what those factors are and
the extent to which they influenced Unum’s decision-making process. See Teamsters,
421 U.S. at 359; Franks, 424 U.S. at 772.
                                             -45-
“causal connection” that their claims were “wrongfully denied” at the class certification

stage of proceedings. The district court in Kuper had already granted class certification to

the plaintiffs at an earlier stage of litigation, and was reviewing, de novo, the grant of

summary judgment in favor of the defendants, after considerable discovery had been

conducted, and after other dispositive motions had been decided. 66 F.3d at 1451-52. The

Court did not discuss class certification requirements anywhere in its opinion, nor was the

Court reviewing the district court’s decision with the substantial deference that is required

when reviewing class certification.

       Second, the Kuper Court’s discussion of a “causal connection” is taken out of

context. In the passage cited by the majority, slip op. at 12, the Kuper Court concluded

that summary judgment was appropriate because the plaintiffs had not demonstrated a

“causal link” between the failure to investigate an investment and the harm suffered by the

plan because the plaintiff had not demonstrated that “an adequate investigation would have

revealed to a reasonable fiduciary that the investment at issue was improvident.” 66 F.3d

at 1459-60. In other words, the Kuper plaintiffs had not proven that the defendants’

actions were improper, even on a general level. Here, as discussed above, proof that

Unum had issued directives that valid medical decisions be disregarded in a quest to meet

financial targets would certainly constitute a breach of duty warranting injunctive relief.

Consequently, the Kuper Court’s statements cannot be plausibly offered for the

proposition that each plaintiff must demonstrate that his claim was wrongfully denied at



                                              -46-
the class certification stage of proceedings.17

       This Court must take care not to confuse issues of general liability with issues of

individualized causation and damages. As we have advised:

               Although such generic and individual causation may appear to

               be inextricably intertwined, the procedural device of the class

               action permitted the court initially to assess the defendant’s

               potential liability for its conduct without regard to the

               individual components of each plaintiff’s injuries. [ . . . ] The

               main problem on review stems from a failure to differentiate

               between the general and the particular. This is an

               understandably easy trap to fall into . . . . Although many

               common issues of fact and law will be capable of resolution on

               a group basis, individual particularized damages still must be

               proved on an individual basis.




Sterling, 855 F.2d at 1200 (affirming grant of class certification in a mass tort class

action). Here, by holding that Plaintiffs must establish that their claims were “wrongfully


        17
          The majority also cites to Hein v. Fed. Deposit Ins. Corp., 88 F.3d 210, 224 (3d
Cir. 1996), for the proposition that when a plaintiff is not wrongfully denied benefits, no
“causal link” is established between the alleged breach of fiduciary duty and the denial
of benefits. Slip op. at 12. Similarly, the Hein court was addressing a grant of summary
judgment and not class certification, and the majority’s arguments fail for the same
reasons discussed above.
                                              -47-
denied” at the class certification stage of proceedings and by denying class certification

based on the presence of individualized issues, my colleagues fall into the “trap” of which

the Sterling Court warned. Because general issues of liability could be resolved for the

class as a whole, individualized issues of causation and damages were no bar to class

certification in that case, and they should be no bar here.

                                             IV.

       In conclusion, the district court’s class certification decision should stand even

under de novo review. But given the deferential standard of review that applies in this

case, it is particularly improper for this Court to reverse the district court’s judgment. In

so doing, my colleagues have misapplied the law of this Court, and have disregarded the

valid purposes that a class action serves. For these reasons, I respectfully dissent.




                                              -48-
