" INDUSTRIAL LIFE INSURANCE CLASS CERTIFICATION DEFEATED"

On December 2nd, the U.S. District Court for the District of South Carolina denied plaintiffs' motion to certify a class of over one million owners of industrial life insurance who claimed to have been subjected to racial discrimination in connection with the sale and pricing of policies issued between 1910 and 1973. This case is one of many similar cases against life insurers predicated on the practice, common during that period (and generally acknowledged, if not required, by state insurance regulators), of pricing policies on the basis of different mortality experience for African-Americans and Caucasians, which generally resulted in payment of higher premiums by African-Americans because of lower life expectancies. The Fifth Circuit (Monumental Life) had reversed the only other decision which had rejected certification and a number of federal and state courts have recently certified classes in similar cases.

The South Carolina District Court denied certification primarily on the grounds that the applicability of the defendant's statute of limitations defense would require highly individualized fact inquiries (and the application of different state statutes) "present[ing] insurmountable barriers to class certification" under the commonality and typicality requirements of Fed. R. Civ. P. 23(a) and the predominance and superiority requirements of Fed. R. Civ. P. 23(b)(3). In so doing, the Court rejected the reasoning of Monumental Life, which held that statute of limitations issues did not preclude certification of a similar class.

JORDEN BURT LLP represented the insurer in this case, working together with Womble Carlyle Sandridge and Rice, PLLC. If you have any questions, please call Jim Jorden (202.965.8135), Wally Pflepsen (202.965.8133), or Steve Goldberg (202.965.8113).

Click link below to view the order in PDF format.