In Re: Monumental, et al

United States Court of Appeals
Fifth Circuit
F I L E D
August 13, 2003
Charles R. Fulbruge III
Clerk
In the
United States Court of Appeals
for the Fifth Circuit
_______________
m 02-30540
_______________
IN THE MATTER OF:
MONUMENTAL LIFE INSURANCE COMPANY,
INDUSTRIAL LIFE INSURANCE LITIGATION.
MATTIE BRATCHER, ET AL.,
Plaintiffs,
MATTIE BRATCHER; JOHN BRATCHER;
CAROLINE BROWN,
ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED;
MARY SUE TRUESDALE;
MAXINE CASH,
ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED;
MILDRED BUFORD,
ALSO KNOWN AS MILDRED GAMLIN,
ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED,
Plaintiffs-Appellants,
VERSUS
NATIONAL STANDARD LIFE INSURANCE COMPANY, ET AL.,
Defendants,
MONUMENTAL LIFE INSURANCE COMPANY,
Defendant-Appellee.

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2
* * * * * * * * * * * * * * * * * * * * * * * * *
IN THE MATTER OF:
UNITRIN, INC.,
INDUSTRIAL LIFE INSURANCE LITIGATION.
ROSIE LEE COTHRAN, ET AL.,
Plaintiffs,
ELIZABETH WALKER,
Plaintiff-Appellee,
VERSUS
SECURITY INDUSTRIAL INSURANCE COMPANY, ET AL.,
Defendants,
MONUMENTAL LIFE INSURANCE COMPANY,
Defendant-Appellee.

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* * * * * * * * * * * * * * * * * * * * * * * * *
IN THE MATTER OF:
AMERICAN NATIONAL INSURANCE COMPANY,
INDUSTRIAL LIFE INSURANCE LITIGATION.
ROSE MARY ROACH,
ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED,
Plaintiff-Appellant,
VERSUS
AMERICAN NATIONAL INSURANCE COMPANY,
Defendant-Appellee.

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* * * * * * * * * * * * * * * * * * * * * * * * *
IN THE MATTER OF:
WESTERN & SOUTHERN LIFE INSURANCE CO.,
INDUSTRIAL LIFE INSURANCE LITIGATION.
JOSEPH BELL, ETC., ET AL.,
Plaintiffs,
JOSEPH BELL,
INDIVIDUALLY AND ON BEHALF OF OTHERS SIMILARLY SITUATED;
WILLA ELLIS, DOCTOR;
THELMA WALKER OATIS,
ON BEHALF OF THEMSELVES AND ALL OTHERS SIMILARLY SITUATED;
ALMA HYDE,
Plaintiffs-Appellants,
VERSUS
WESTERN & SOUTHERN LIFE INSURANCE COMPANY,
Defendant-Appellee.
_______________________________
Appeal from the United States District Court
for the Eastern District of Louisiana
MDL Docket No. 1371,
Consolidated with No. 1391 and No. 1395
_________________________

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5
Before SMITH, DENNIS, and CLEMENT,
Circuit Judges.
JERRY E. SMITH, Circuit Judge:
In what may be the ultimate negative value
class action lawsuit,1 plaintiffs challenge de-
fendants’ alleged practice of paying lower ben-
efits and charging higher premiums to blacks in
the sale of low-value life insurance. The dis-
trict court denied plaintiffs’ motion to certify
a class pursuant to FED. R. CIV. P. 23(b)(2),
finding, inter alia, that the majority of class
members would not benefit from injunctive
relief. Based primarily on Allison v. Citgo
Petroleum Co., 151 F.3d 402 (5th Cir. 1998),
we reverse and remand.
I.
This is a consolidation of civil rights actions
against three life insurance companies: Monu-
mental Life Insurance Company (“Monumen-
tal”), American National Insurance Company
(“ANICO”), and Western and Southern Insur-
ance Company (“Western and Southern”).
Plaintiff policyowners, all of whom are black,
allege that, for decades, defendants discrimi-
nated against them in the sale and administra-
tion of low-value life insurance policies,
known as industrial life policies,2 that have
face amounts of $2000 or less and require
small weekly or monthly premiums. Defen-
dants comprise over 280 companies that issued
industrial life policies over a fifty- to sixty-five-
year period.3
Plaintiffs allege two overtly discriminatory
practices. First, they accuse defendants of
placing blacks in industrial policies offering the
same benefits as do policies sold to whites, but
at a higher premium (dual rates). Second,
defendants allegedly placed blacks in specially-
designed substandard industrial policies pro-
viding fewer or lower benefits than do com-
parable plans sold to whites (dual plans).
These practices are memorialized in the in-
surer’s rate books and records, which explic-
itly distinguish dual rate and dual plan policies
by race.4 Although, before filing their motion
for class certification, plaintiffs challenged the
insurers’ alleged practice of charging blacks
substandard premiums because of non-racial
underwriting factors, such as mental condition,
occupation, socioeconomic status, educational
level, living conditions, and personal habits,
plaintiffs no longer complain of such pretextual
1 A “negative value”suit is one in which class
members’ claims “would be uneconomical to liti-
gate individually.” Phillips Petroleum v. Shutts,
472 U.S. 797, 809 (1985); see also Castano v.
Am. Tobacco Co., 84 F.3d 734, 748 (5th Cir.
1996).
2 Defendants defend this practice on the basis
that (1) the race-distinct pricing was justified;
(2) the practice was approved by regulators; (3) the
racially discriminatory policies were no more pro-
fitable than were those sold to whites; and (4) some
(continued...)
2(...continued)
of the discriminatory policies were remediated.
3 Over the years, defendants have acquired other
insurance companies and thereby assumed blocks
of in-force insurance policies issued by them.
Monumental currently administers policies issued
by 200 different companies, while Western and
Southern administers policies issued by approx-
imately 80 companies. ANICO has assumed an in-
determinate number of in-force policies.
4 As an example, a 1962 ANICO rate book
shows that, for a twenty-year-old black, a $500
“20 Pay Life” industrial policy charged a weekly
premium of $0.41, while a twenty-year-old white
paid only $0.32.

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6
underwriting procedures.
Defendants state that they issued “hun-
dreds, perhaps thousands, of different indus-
trial life insurance products” encompassing a
countless variety of underwriting standards. It
is undisputed that all companies that sold dual
rate or dual plan policies have not done so
since the early 1970’s. Also, as early as 1988,
some insurers voluntarily adjusted premiums
and/or death benefits to equalize the amount of
coverage per premium dollar. Still, plaintiffs
estimate that over 4.5 million of the 5.6 million
industrial policies issued by defendants remain
in-force; many other policies have been termi-
nated, surrendered, or paid-up without remedi-
ation.5 Defendants’ expert estimates that the
ratio of terminated policies to outstanding pol-
icies is approximately five to one, meaning that
slightly more than one million policies remain
in-force.
Plaintiffs sued for violations of 42 U.S.C.
§§ 1981 and 1982, seeking (1) an injunction
prohibiting the collection of discriminatory
premiums, (2) reformation of policies to equal-
ize benefits, and (3) restitution of past premi-
um overcharges or benefit underpayments.
Pursuant to 28 U.S.C. § 1407, the Judicial
Panel for Multidistrict Litigation (“MDL”)
consolidated the actions against Monumental
and transferred them to the Eastern District of
Louisiana for pretrial proceedings. Later, the
MDL Panel took the same action with the
cases against ANICO and Western and South-
ern.
Plaintiffs moved for certification of a class
pursuant to rule 23(b)(2), requesting that class
members be provided notice and opt-out
rights. The district court denied certification,
finding that plaintiffs’ claims for monetary re-
lief predominate over their claims for injunc-
tive relief, making rule 23(b)(2) certification
inappropriate. The court also found that, giv-
en the large number of companies and policies
involved, individualized hearings were neces-
sary to determine damages and whether claims
were barred by the statute of limitations. De-
fendants sought, and this court granted, inter-
locutory review pursuant to FED. R. CIV. P.
23(f).
II.
Defendants contend that class members
cannot be readily identified by way of the class
definition. A precise class definition is neces-
sary to identify properly “those entitled to
relief, those bound by the judgment, and those
entitled to notice.” 5 JAMES W. MOORE ET
AL., MOORE’S FEDERAL PRACTICE § 23.21[6],
at 23-62.2 (3d ed. 2003); see DeBremaecker
v. Short, 433 F.2d 733, 734 (5th Cir. 1970).
Some courts have stated that a precise class
definition is not as critical where certification
of a class for injunctive or declaratory relief is
sought under rule 23(b)(2).6 Where notice and
5 Plaintiffs allege that Monumental has not ad-
justed any of its dual rate or dual plan policies.
ANICO adjusted one of its four discriminatory
“Standard No. 3 plans.
6 See Battle v. Commonwealth, 629 F.2d 269,
271 n.1 (3d Cir. 1980) (“Where . . . the class ac-
tion seeks only injunctive or declaratory relief, for
which the notice provision of Fed. R. Civ. P. 23-
(c)(2) is not mandatory, the district court has even
greater freedom in both the timing and specificity
of its class definition.”); Rice v. City of Philadel-
phia, 66 F.R.D. 17, 19 (E.D. Pa. 1974) (“[T]he
precise definition of the [(b)(2)] class is relatively
unimportant. If relief is granted to the plaintiff
class, the defendants are legally obligated to com-
ply, and it is usually unnecessary to define with
precision the persons entitled to enforce compliance
(continued...)

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7
opt-out rights are requested, however, a pre-
cise class definition becomes just as important
as in the rule 23(b)(3) context.
Plaintiffs sought to certify a class comprised
of “[a]ll African-Americans who own, or
owned at the time of policy termination, an
industrial life insurance policy that was issued
as a substandard plan or at a substandard
rate.” Defendants argue that the plain lan-
guage of that definition does not comport with
the class plaintiffs seek to certify. As we have
noted, before moving for certification plaintiffs
had included not only blacks who had pur-
chased dual rate or dual plan policies, but also
blacks who allegedly were forced into sub-
standard plans, or forced to pay substandard
rates, through the use of non-racial underwrit-
ing factors.
In their motion for certification, plaintiffs
narrowed the class, stating that “[t]he pro-
posed class does not include those who may
have been subjected to covert socio-economic
forms of racial discrimination.” Plaintiffs spe-
cified that “the term ‘substandard’ applies to
overt race-distinct dual premiums and plans,
not to policies called substandard because of
other factors such as socio-economic under-
writing.” We agree with defendants’ observa-
tion that, as written, t he class definition in-
cludes all blacks who paid substandard rates or
were issued substandard plans. The definition
makes no distinction between class members
who purchased dual rate or dual plan policies
and those forced into substandard rates or sub-
standard plans through the use of pretextual
underwriting practices. In other words, one
must look to the certification motion for an
adequate description of the proposed class.
Holding plaintiffs to the plain language of
the class definition would be overly formalis-
tic. In the first place, the district court, in de-
nying certification, apparently did not consider
the pretextual claims as part of the proposed
class. Though referring to the “mass of poli-
cies involved” and the “differing underwriting
practices among some 280 companies,” the
court stated that in calculating damages, indi-
vidualized hearings were necessary to account
for the idiosyncracies of each policy. At no
point did the court suggest that individualized
hearings were necessary to determine liability,
as would be necessary if pretextual underwrit-
ing claims were part of the class.
Second, holding plaintiffs to the plain lang-
uage of their definition would ignore the on-
going refinement and give-and-take inherent in
class action litigation, part icularly in the for-
mation of a workable class definition. District
courts are permitted to limit or modify class
definitions to provide the necessary precision.7
If the class is certified on remand, we trust that
the plaintiffs or district court will amend the
definition accordingly.
Defendants also argue that the definition
terms “own, or owned,” “industrial life insur-
ance policy,” “substandard plan,” and “sub-
6(...continued)
. . . .”).
7 See, e.g., Robidoux v. Celani, 987 F.2d 931,
937 (2d Cir. 1993) (“A court is not bound by the
class definition proposed in the complaint and
should not dismiss the action simply because the
complaint seeks to define the class too broadly.”);
Harris v. Gen. Dev. Corp., 127 F.R.D. 655, 659
(N.D. Ill. 1989) (“[I]t is certainly within this
court’s discretion to limit or redefine the scope of
the class.”); Meyer v. Citizens & S. Nat’l Bank,
106 F.R.D. 356, 360 (M.D. Ga. 1985) (“The
Court has discretion in ruling on a motion to certify
a class. This discr etion extends to defining the
scope of the class.”) (citations omitted).

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8
standard rate” are ambiguous, further compli-
cating identification of class members. This
argument, too, is overly formalistic. See For-
bush, 994 F.2d at 1105-06.
Plaintiffs’ filings in the district court clari-
fied any ambiguities by stating that “the class
is limited to industrial policies sold at a sub-
standard (i.e., higher) rate for African-Ameri-
cans and a lower rate for Caucasians, or as a
substandard plan (i.e., a more costly plan) for
African-Americans and a corresponding less
expensive plan for Caucasians.” Plaintiffs de-
fine industrial life insurance policies as
“(1) policies labeled as ‘industrial’ or (2) those
policies with a face amount of less than
$2,000.00 and weekly or monthly home pre-
mium collection.” Defendants were provided
adequate notice and discovery by which to ar-
gue that the narrowed class cannot be certified
pursuant to rule 23(b)(2).
III.
We review for abuse of discretion the denial
of class certification. Jenkins v. Raymark In-
dus., 782 F.2d 468, 471-72 (5th Cir. 1986).
“Implicit in this deferential standard is a recog-
nition of the essentially factual basis of the cer-
tification inquiry and of the district court’s in-
herent power to manage and control pending
litigation.” Allison, 151 F.3d at 408. We re-
view de novo however, the question whether
the district court applied the correct legal stan-
dard. Forbush, 994 F.2d at 1104.
All classes must satisfy the four baseline re-
quirements of rule 23(a): numerosity, com-
monality, typicality, and adequacy of represen-
tation.8 FED. R. CIV. P. 23(a). Assuming these
requirements are satisfied, a rule 23(b)(2) class
may be certified if “the party opposing the
class has acted or refused to act on grounds
generally applicable to the class, thereby mak-
ing appropriate final injunctive relief or corre-
sponding declaratory relief with respect to the
class as a whole.” FED. R. CIV. P. 23(b)(2).
Plaintiffs premise rule 23(b)(2) certification on
their request for an injunction prohibiting the
further collection of discriminatory premiums.
A.
The court observed that “many” proposed
class membersSSthose whose policies have
lapsed, those whose policies have already been
voluntarily adjusted by defendants, and those
whose death benefits already have been
paidSSwould not benefit from injunctive relief.
The court concluded that “this is a case in
which individuality overrides any bland group-
think, and money becomes the prime goal . . .
not injunctive relief.” Rule 23(b)(2) certifica-
tion is improper, the court held, where the
class’s request for injunctive relief merely
serves as a bootstrap for a claim of monetary
damages.
In Allison, we carefully explained the state-
ment in the advisory committee notes that rule
23(b)(2) certification “does not extend to cas-
es in which the appropriate final relief relates
exclusively or predominantly to money dam-
ages.” FED. R. CIV. P. 23 advisory committee
notes (emphasis added).9 Allison did not hold,
8 The district court noted that “oral argument
unveiled serious adequacy of representation is-
(continued...)
8(...continued)
sues,” but did not rely on this basis in denying
certification.
9 Allison, 151 F.3d at 411-12 (“The Advisory
Committee Notes make no effort to define or ex-
plain the concept. Interpreting the term literally,
(continued...)

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9
as the district court believed, that monetary re-
lief predominates where it is the “prime goal”
or a mere bootstrap to injunctive relief. In-
stead, “determining whether one form of relief
actually predominates in some quantifiable
sense is a wasteful and impossible task that
should be avoided.” Allison, 151 F.3d at 412
(citing 7A CHARLES A. WRIGHT ET AL., FED-
ERAL PRACTICE AND PROCEDURE § 1775, at
470 (2d ed. 1986)). In other words, certifica-
tion does not hinge on the subjective intentions
of the class representatives and their counsel in
bringing suit.10
Instead, Allison looked to the nature of the
rule 23(b)(2) device in defining when monetary
relief predominates. That rule’s focus on in-
junctive and declaratory relief presumes a class
best described as a “homogenous and cohesive
group with few conflicting interests among its
members.” Id. at 413. Class certification
centers on the defendants’ alleged unlawful
conduct, not on individual injury. Once mone-
tary damages enter the picture, however, class
cohesiveness is generally lost, because
“[m]onetary remedies are more often related
directly to the disparate merits of individual
claims.” Id. (citations omitted). Where the
need to address the merits of individual claims
requires separate hearings, the efficiency
gained by class litigation is lost.
In Allison, therefore, we held, id. at 415,
that monetary relief, to be viable in a rule
23(b)(2) class, must “flow directly from
liability to the class as a whole on the claims
forming the basis of the injunctive or
declaratory relief.” Monetary relief must be
incidental, meaning that it is “capable of
computation by means of objective standards
and not dependent in any significant way on
the intangible, subjective differences of each
class member’s circumstances.”11 Id.
Additional hearings to resolve “the disparate
merits of each individual’s case” should be
unnecessary. Id.
Of course, rule 23(b)(2) certification
requires the defendants’ conduct to be ongoing
such that injunctive relief will benefit at least
some class members. In Bolin v. Sears
Roebuck & Co., 231 F.3d 970, 972 (5th Cir.
2000), we purported to apply Allison to a pro-
posed rule 23(b)(2) class of one million
consumers who alleged that the defendant had
employed various illegal practices to coerce
payment of otherwise-discharged pre-
bankruptcy debt. We observed that “[m]ost of
the class consists of individuals who do not
face further harm from Sear’s [sic] actions.”
Id. at 978. In fact, only one class member who
might benefit from injunctive relief was
9(...continued)
predominant means ‘controlling, dominating, [or]
prevailing.’ But how that translates into a work-
able formula for comparing different types of rem-
edies is not at all clear.”) (citation omitted).
10 But see Molski v. Gleich, 318 F.3d 937, 950
(9th Cir. 2003) (expressly rejecting Allison and in-
stead “focus[ing] on the language of Rule 23(b)(2)
and the intent of the plaintiffs in bringing the suit”);
Robinson v. Metro-North Commuter R.R., 267
F.3d 147, 163-64 (2d Cir. 2001) (stating that rule
23(b)(2) certification is appropriate only where
“reasonable plaintiffs would bring the suit to obtain
the injunctive or declaratory relief sought” and “the
injunctive or declaratory relief sought would be
both reasonably necessary and appropriate were
the plaintiffs to succeed on the merits”).
11 The predomination requirement serves two
basic purposes, namely the interests of class mem-
bers who may wish to pursue monetary claims in-
dividually, and interests of judicial economy. Alli-
son, 151 F.3d at 415.

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10
identified. Id.12
Here, by contrast, even defendants’ expert
estimates that one million dual rate or dual
plan policies remain in-force.13 The exact
number of class members continuing to pay
discriminatory premiums is unknown, but we
are willing to assumeSSwithout contrary evi-
dence from defendantsSSthat the number ex-
ceeds the de minimis standard set by Bolin.
B.
To the extent that Bolin misinterprets Alli-
son by conditioning certification on the
number of class members that will “truly
benefit” from injunctive relief, it reflects a
concern that plaintiffs may attempt to
“shoehorn damages actions into the Rule
23(b)(2) framework, depriving class members
of notice and opt-out protections.”14 Indeed,
we suggested in Allison , 151 F.3d at 413, that
monetary relief may predominate “when its
presence in the litigation suggests that the pro-
cedural safeguards of notice and opt-out are
necessary.” Defendants seize on this point, ar-
guing that plaintiffs’ request for notice and
opt-out is a tacit admission that rule 23(b)(2)
certification is inappropriate. This ignores the
discretion given a district court to order notice
and opt-out rights when certifying a rule 23-
(b)(2) class. See FED. R. CIV. P. 23(d)(2).
As “fundamental requisites of the
constitutional guarantees of procedural due
process,” Eisen v. Carlisle & Jacquelin, 417
U.S. 156, 174 (1974), notice and opt-out are
mandatory for damage classes certified under
rule 23(b)(3). Though rule 23 does not
explicitly extend these safeguards to rule
23(b)(2) classes, due process requires the
provision of notice where a rule 23(b)(2) class
seeks monetary damages.15
On the other hand, there is no absolute
right of opt-out in a rule 23(b)(2) class, “even
where monetary relief is sought and made
available.” Penson, 634 F.2d at 994; Kincade
v. Gen. Tire & Rubber Co., 635 F.2d 501,
605-07 (5th Cir. Jan. 1981). Under our prece-
dent, should the class be certified on remand,
class members must be provided adequate
notice, and the district court should consider
the possibility of opt-out rights.16
12 When the class action was filed, the defendant
was suing one of the class members in state court.
Although defendant abandoned the suit, the court
raised the possibility that the controversy had not
been mooted. Bolin, 231 F.3d at 978 n.46.
13 As noted, plaintiffs’ expert contends that 4.5
million of the 5.6 million industrial life insurance
policies issued by defendants remain in-force.
14 Bolin, 231 F.3d at 976; see also McManus v.
Fleetwood Enters., 320 F.3d 545, 554 (5th Cir.
2003) (“[C[]lass members would potentially re-
ceive a poor substitute for individualized money
damages, without the corresponding notice and opt-
out benefits of Rule 23(b)(3) . . . .”).
15 Allison, 151 F.3d at 412 n.4 (citing Johnson
v. Gen. Motors Corp., 598 F.2d 432, 436-38 (5th
Cir. 1979)); Penson v. Terminal Transp. Co., 634
F.2d 989, 994 (5th Cir. Unit B Jan. 1981). The
type of notice afforded to rule 23(b)(2) class mem-
bers seeking monetary relief will not always be
“equivalent to that required in (b)(3) actions.”
Johnson, 598 F.2d at 438.
16 See Jefferson v. Ingersoll Int’l, Inc., 195
F.3d 894, 898 (7th Cir. 1999) (contemplating the
use of opt-out rights for a rule 23(b)(2) class); Eu-
bank v. Billington, 110 F.3d 87, 94 (D.C. Cir.
1997) (holding that the language of rule 23 is suf-
ficiently flexible to afford district courts the
discretion to grant opt-out rights for rule 23(b)(2)
(continued...)

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11
Allison’s statement that monetary relief
may predominate where notice and opt-out are
necessary reflects only the inescapable fact that
such safeguards are most appropriate where
individual issues diminish class cohesiveness.
Then, conflicts among class members and is-
sues of adequate representation are most likely
to surface. Rule 23(b)(3) is the default vehicle
for certification, but only because notice and
opt-out rights are mandatory components. A
district court is empowered by rule 23(d)(2) to
provide notice and opt-out for any class
action, so rule 23(b)(2) certification should not
be denied on the mistaken assumption that a
rule 23(b)(3) class is the only means by which
to protect class members.17
All of this further demonstrates the futility
of the district court’s and dissent’s inquiry as
to whether the “prime goal” of the class is in-
junctive or monetary relief. The rule 23(b)(2)
predominance requirement, by focusing on un-
iform relief flowing from defendants’ liability,
“serves essentially the same functions as the
procedural safeguards and efficiency and man-
ageability standards mandated in (b)(3) class
actions.” Allison, 151 F.3d at 414-15.
Therefore, to deny certification on the basis
that the damage claims would be better
brought as a rule 23(b)(3) class serves no
function other than to elevate form over
substance.18 Indeed, interests of judicial
economy are best served by resolving
plaintiffs’ claims for injunctive and monetary
relief together.
IV.
Applying Allison’s predominance test, the
district court determined that the requested
monetary relief does not flow from liability to
the class as a whole. The court stated that
“many and a variety of hearings would be re-
quired to determined personalized harm to
each individual plaintiff because of the mass of
policies involved, differing underwriting prac-
tices among some 280 companies, differing
built-in benefits, account dividends, and age at
policy issuance.”
16(...continued)
classes).
17 One of the dissent’s two reasons for finding
class certification inappropriate concerns our
supposed “suggestion” that notice and opt-out
rights are necessary. In Allison, 151 F.3d 414,
however, we explained that “[t]he fact that the
predomination requirement serves to protect the
rights of class members . . . does not imply . . . that
the availability of monetary relief in a (b)(2) class
action depends solely or directly on whether class
members are entitled to notice or opt-out rights.”
As mentioned, this court’s precedent requires that
notice be provided where a rule 23(b)(2) class
seeks damages, see supra note 15, so it is circular
for the dissent to argue notice as a basis for
denying certification. Our direction to the district
court to consider the possibility of opt-out rights
speaks nothing as to whether such rights are
necessary or even desirable.
18 Our view that the rule 23(b)(2) and (b)(3)
devices may work in tandem is strengthened by the
roots of subdivision (b)(2), which was added “to
Rule 23 in 1966 primarily to facilitate the bringing
of class actions in the civil rights area.” 7A
CHARLES A. WRIGHT ET AL., FEDERAL PRACTICE
AND PROCEDURE § 1775, at 470 (2d ed. 1986).
Before its adoption, the rules made no explicit
reference to class actions involving injunctive or
declaratory relief, and “there was some uncertainty
whether a class action seeking one of those
remedies was an appropriate device for vindicating
civil rights.” Id. at 470-71. Rule 23(b)(2) was
adopted to facilitate the use of injunctive relief, not
to compartmentalize claims for damages under rule
23(b)(3).

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12
A.
Plaintiffs contend they seek equitable res-
titution in the form of a constructive trust for
class members who no longer have in-force
policies. By characterizing this relief as
equitable, plaintiffs hope to demonstrate that
that that relief is inherently compatible with
rule 23(b)(2) certification, thereby avoiding
Allison’s monetary predominance inquiry. De-
fendants argue that plaintiffs, who never used
the term “constructive trust” in the district
court, are trying to “re-package” their
straightforward request for damages.
Equitable monetary relief is compatible with
a rule 23(b)(2) class.19 Importantly, this pro-
nouncement has been limited to the context of
title VII backpay, a remedy designated by stat-
ute as “equitable.” 42 U.S.C. § 2000e-5(g)(1);
Great-West Life & Annuity Ins. Co. v. Knud-
son, 534 U.S. 204, 218 n.4 (2002). Backpay
is therefore unique in that it is “an integral
component of Title VII’s ‘make whole’
remedial scheme.” Allison, 151 F.3d at 415;
see also Johnson v. Ga. Highway Express,
Inc., 417 F.2d 1122, 1125 (5th Cir. 1969).
Not coincidentally, as compared to compen-
satory damages, “calculation of back pay gen-
erally involves less complicated factual de-
terminations and fewer individual issues.”
Coleman v. Gen. Motors Acceptance Corp.,
296 F.3d 443, 449 (6th Cir. 2002). In Allison,
151 F.3d at 415, we recognized that, for this
reason, backpay generally does not
predominate over injunctive or declaratory
relief.
It would be mistaken to presume that be-
cause backpaySSa remedy readily calculable on
a classwide basisSSis compatible with a rule
23(b)(2) class, any other remedy designated as
equitable may automatically piggyback a claim
for injunctive relief. To be sure, equitable
monetary remedies are less likely to
predominate over a class’s claim for injunctive
relief, but this has more to do with the uniform
character of the relief rather than with its label.
Therefore, rather than decide whether
plaintiffs’ claim for restitution is legal or
equitable in nature, we apply Allison and ex-
amine whether the claim predominates over
the request for injunctive relief.
B.
This is not a case in which class members
are entitled to a one-size-fits-all refund;
assuming liability is established, individual
damages will depend on the idiosyncracies of
the particular dual rate or dual plan policy.
For example, the age at which a class member
purchased a dual rate policy will have an im-
pact on how long the insured paid premiums
and consequently on the amount of damages.
Some policies contain built-in benefits
covering occurrences outside of death, such as
loss of limb; others pay periodic dividends. As
we have observed, som e defendants,
beginning in 1988, voluntarily adjusted
premiums and benefits for some policies sold
on a race-distinct basis.
Plaintiffs propose using standardized
formulas or restitution grids to calculate
individual class members’ damages.
Defendants counter that “thousands” of grids
19 See Allison, 151 F.3d at 415-16 (“If the in-
stant case involved only claims for equitable mon-
etary relief, Pettway [v. Am. Cast. Iron Pipe Co.,
494 F.2d 211, 257 (5th Cir. 1974)] would control.
Pettway, however, did not address the availability
in (b)(2) class actions of other forms of monetary
relief, such as compensatory and punitive damages
. . . .”); Pettway, 494 F.2d at 257 (“All that need
be determined is that conduct of the party opposing
the class is such as makes such equitable relief
appropriate.”).

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13
must be constructed to account for the myriad
of policy variations. That may be so, but the
monetary predominance test does not contain
a sweat-of-the-brow exception. Rather, we
are guided by its command that damage
calculation “should neither introduce new and
substantial legal or factual issues, nor entail
complex individualized determinations.”
Allison, 151 F.3d at 415.
In the list of policy variables cited by de-
fendants and the district court, none requires
the gathering of subjective evidence.20 This is
not, for example, like Allison, a title VII case
in which class members’ claims for
compensatory and punitive damages
necessarily “implicate[] the subjective
differences of each plaintiff’s circumstances.”
Id. at 417. Rather, assuming that unlawful
discrimination is found, class members
automatically will be entitled to the difference
between what a black and a white paid for the
same policy. Not coincidentally, such
damages flow from liability in much the same
manner that an award of backpay results from
a finding of employment discrimination.
Pettway, 494 F.2d at 256-58.
We are well aware that, as Allison qualifies,
151 F.3d at 415, the calculation of monetary
damages should not “entail complex indi-
vidualized determinations.” Although it is ar-
guable that the construction of thousands of
restitution grids, though based on objective
data, involves the sort of complex data manip-
ulations forbidden by Allison, we read Allison
to the contrary. The policy variables are iden-
tifiable on a classwide basis and, when sorted,
are capable of determining damages for indi-
vidual policyowners; none of these variables is
unique to particular plaintiffs.21 The pre-
valence of variables common to the class
makes damage computation “virtually a me-
chanical task.” Alabama v. Blue Bird Body
Co., 573 F.2d 309, 326-27 (5th Cir. 1978)
(quoting Windham v. Am. Brands, Inc., 565
F.2d 59, 68 (4th Cir. 1977)).22
20 Had plaintiffs not limited their proposed class
to dual rate and dual plan policies, individual hear-
ings would be necessary to determine whether pre-
textual underwriting practices were used to force
the respective class members into substandard
plans. In that instance, we agree with the district
court that the large number of defendants and un-
derwriting practices would be relevant to finding
the predominance of monetary damages.
21 In this sense, the instant case is unlike O’Sul-
livan v. Countrywide Home Loans, Inc., 319 F.3d
732, 744-45 (5th Cir. 2003), in which we found
monetary damages predominant in a proposed rule
23(b)(3) class alleging violations of Texas’s
statute prohibiting the unauthorized practice of
law. Non-lawyers were alleged to have used “legal
skill or knowledge” in the preparation of mortgage
closing documents. Whether certain practices by
the non-lawyers violated the statute was
determinable on a classwide basis; we explained,
however, that monetary damages predominated,
because the extent of these practices varied by
transaction, and plaintiffs were entitled to a refund
only for those practices that violated the statute.
Therefore, each transaction had to be dissected to
determine the extent of liability and damages.
22 One is left wondering in what circumstances
(if any) the dissent would permit monetary
damages in a rule 23(b)(2) class. Remarkably, the
dissent makes no attempt to explain its view that
insurance policy factors such as premium rate,
issue age, and benefits paid are based on
“intangible, subjective differences.” Allison, 151
F.3d at 415. Instead, Allison’s statement that
damages be “capable of computation by means of
objective standards” is ideal for refund-type cases
such as this, in which damages are calculable using
(continued...)

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14
Finally, defendants’ records contain the in-
formation necessary to determine disparities
between, on the one hand, dual rate and dual
plan policies, and on the other hand, plans sold
to whites. Damage calculations do not require
the manipulation of data kept outside
defendants’ normal course of business.
Defendants’ complaints to the contrary are
belied by the fact that, since 1988, many
policies have been adjusted to account for
racial disparity.
V.
As noted, defendants have not sold dual
plan or dual rate policies since the 1970’s;
some class members purchased their policies
as far back as the 1940’s. The district court
denied certification also on the basis that indi-
vidualized hearings are necessary to determine
expiration of the statute of limitations for par-
ticular sets of policies. The predominance of
individual issues necessary to decide an affirm-
ative defense may preclude class certification.
Castano, 84 F.3d at 744. Limitations is an af-
firmative defense. FED. R. CIV. P. 8(c);
2 JAMES W. MOORE, MOORE’S FEDERAL
PRACTICE § 8.07[1], at 8-34 (3d ed. 2003).
Although, under §§ 1981 and 1982, state
law governs the substantive limitations period,
federal law determines when the period
accrues. Perez v. Laredo Junior Coll., 706
F.2d 731, 733 (5th Cir. 1983). It commences
when the plaintiff either has actual knowledge
of the violation or has knowledge of facts that,
in the exercise of due diligence, would have
led to actual knowledge.23 State law may
further toll the running of limitations. Gartrell
v. Gaylor, 981 F.2d 254, 257 (5th Cir. 1993).
Doubtless most class members, the majority
of whom are poor and uneducated, remain
unaware of defendants’ discriminatory
practices. Of the thirteen representative
plaintiffs, defendants point to only one, Jo Ella
Brown, whose claim may have expired
because of actual knowledge of defendants’
practices.
To hold that each class member must be de-
posed as to precisely when, if at all, he learned
of defendants’ practices would be tantamount
to adopting a per se rule that civil rights cases
involving deception or concealment cannot be
certified outside a two- or three-year period.24
Waste Mgmt. Holdings, Inc., 208 F.3d 288,
22(...continued)
factors developed and maintained in the course of
defendants’ business. Id. The dissent evidently
would limit damages in rule 23(b)(2) classes to
instances in which there is no variance among the
“specific characteristics of each policy and
policyholder,” a standard that necessarily would
require that each class members’ damages be
identical. It is safe to say that the dissent’s novel
approach is unsupported by caselaw.
23 E.g., Harris v. Hegmann, 198 F.3d 153, 156-
57 (5th Cir. 1999); Jensen v. Snellings, 841 F.2d
600, 606 (5th Cir. 1988).
24 The district court’s reliance on Barnes v. Am.
Tobacco Co., 161 F.3d 127 (3d Cir. 1998), is mis-
placed. The proposed class, all smokers before age
nineteen, brought medical monitoring claims
against defendant tobacco companies. The court,
id. at 149, determined that individual issues existed
as to the accrual of the statute of limitations, which
required a determination for each plaintiff as to
when “he began smoking and how much he has
smoked since then.” By definition, the limitations
period had commenced for each and every class
member. Here, accrual of the statute of limitations
is premised on defendants’ common practice of
concealment, so a presumption of unawareness by
the plaintiff class is warranted.

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15
296 (1st Cir. 2000). Such a result would fore-
close use of the class action device for a broad
subset of claims, a result inconsistent with the
efficiency aims of rule 23. Though individual
class members whose claims are shown to fall
outside the relevant statute of limitations are
barred from recovery, a rebuttable
presumption that the class lacks knowledge of
defendants’ concealment is warranted at the
class certification stage.
Instead, defendants rely on a theory of con-
structive notice, arguing that widespread me-
dia reporting of the issue over the last several
decades should have “excite[d] the inquiry of
a reasonable person.” Conmar Corp. v. Mistui
& Co. (U.S.A.), Inc., 858 F.2d 499, 504 (9th
Cir. 1998). Where events receive “widespread
publicity, plaintiffs may be charged with
knowledge of their occurrence.” United Klans
of Am. v. McGovern, 621 F.2d 152, 154 (5th
Cir. 1980); In re Beef Antitrust Indus. Litig.,
600 F.2d 1148, 1170 (5th Cir. 1979). The dis-
trict court believed constructive notice to be
an individual issue, or at least a regional one,
stating that “whether a plaintiff in Michigan, as
compared to a plaintiff in Louisiana, had con-
structive notice, is a fact issue which needs to
be determined individually and not on a class-
wide basis.”
Whether the media reports were sufficiently
publicized so as to provide constructive notice
is an issue reserved for the merits. Our
analysis is limited to whether this issue is
determinable on a classwide basis. Had
defendants provided evidenceSSor even
allegedSSthat media treatment of this issue
was more prevalent in some regions of the
country than in others, the district court’s
observation that individualized hearings are
required to determine the geographic reach of
constructive notice might be sustainable.
The requirement of “widespread publicity,”
McGovern, 621 F.2d at 154, suggests,
however, that the appropriate frame of
reference is the national media market, at least
for issues of national importance. Several
publications listed by defendants, including the
Washington Post, the Wall Street Journal, and
USA Today, are available throughout the Unit-
ed States, and although many other
publications are local newspapers, that fact is
entirely consistent with national treatment of
the issue. Neither the district court nor
defendants give good reason for
geographically splicing constructive notice.
We therefore have no difficulty concluding
that whether plaintiffs were provided
constructive notice is an issue that can be
decided on a classwide basis.
The order denying class certification is
REVERSED, and this matter is REMANDED
for further proceedings consistent with this
opinion. We express no view on the district
court’s ultimate decision whether to certify in
light of today’s opinion, nor do we opine on
the ultimate merits of the substantive claims.
ENDRECORD
ENDRECORD

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25 Incidental damages are defined as those “that flow directly from liability to the class as a whole on the
claims forming the basis of the injunctive or declaratory relief.”Id.
16
CLEMENT, Circuit Judge, dissenting:
Based on Allison v. Citgo Petroleum Co., 151 F.3d 402 (5th Cir. 1998), and McManus v.
Fleetwood Enters., 320 F.3d 545 (5th Cir. 2003), the district court properly denied class certification
to Plaintiffs.
Plaintiffs seek class certification under Rule 23(b)(2), which permits cases meeting the
requirements of Rule 23(a) to be certified as class actions if “the party opposing the class has acted
or refused to act on grounds generally applicable to the class, thereby making appropriate final
injunctive relief or corresponding declaratory relief with respect to the class as a whole.” FED. R. CIV.
P. 23(b)(2). Unlike Rule 23(b)(1) or (b)(3), Rule 23(b)(2) “was intended to focus on cases where
broad, class-wide injunctive or declaratory relief is necessary.” Allison, 151 F.3d at 412.
Rule 23(b)(2) is silent as to whether monetary remedies may be sought in conjunction with
injunctive or declaratory relief, but the Advisory Committee Notes on Rule 23 state that class
certification under (b)(2) “does not extend to cases in which the appropriate final relief relates
exclusively or predominantly to money damages.” Id. at 411. Based on this language, the Fifth Circuit
“neither allow[s] certification without regard to the monetary remedies being sought, nor restrict[s]
certification to classes seeking exclusively injunctive or declaratory relief.” Id. The key question is
whether “the predominant relief sought is injunctive or declaratory.” Id. at 411-412; Parker v. Time
Warner Entm't Co., L.P., 331 F.3d 13, 15 (2d Cir. 2003). The corresponding question is whether the
monetary relief is incidental to the requested injunctive or declaratory relief.25 Allison, 151 F.3d at
415. If injunctive or declaratory relief does not predominate (or if monetary relief is not incidental),

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26 Equitable monetary relief, such as back pay, is not subject to the Allison predomination test. Allison, 151
F.3d at 415-16 (“If the instant case involved only claims for equitable monetary relief, [Pettway v. American
Cast Iron Pipe Co., 494 F.2d 211 (5th Cir. 1974)] would control. Pettway, however, did not address the
availability in (b)(2) class actions of other forms of monetary relief, such as compensatory and punitive
damages, nor did it have any occasion to do so.”).
27 Footnote 22 of the majority opinion misrepresents the meaning of the term “uniform group remedies”.
In a Rule 23(b)(2) class action, each class member does not need to receive the exact same amount of monetary
relief. Allison, 151 F.3d at 415. However, the monetary relief awarded must be based on the “group nature of
the harm alleged” rather than the individual harm suffered by each class member. Id. at 413, 415.
17
class certification under Rule 23(b)(2) is inappropriate.26 Id.
There are two circumstances in which Rule 23(b)(2) class certification is inappropriate. First, Rule
23(b)(2) does not provide for procedural safeguards like notice and opt-out rights, primarily because
the class is presumed to be “homogenous and cohesive” due to “the group nature of the harm alleged
and the broad character of the relief sought.” Id. at 413 (emphasis added). Therefore, if notice and/or
opt-out rights seem to be necessary, then certification under Rule 23(b)(2) may be inappropriate. Id.
(“[M]onetary relief ‘predominates’ under Rule 23(b)(2) when its presence in the litigation suggests
that the procedural safeguards of notice and opt-out are necessary.”).
Second, Rule 23(b)(2) only permits monetary relief in the form of “uniform group remedies.” Id.
at 414; McManus, 320 F.3d at 554. Uniform group remedies are consistent with Rule 23(b)(2) for
two reasons: (1) they are “capable of computation by means of objective standards,” thus avoiding
the need for “complex individualized determinations” and procedural safeguards like notice and opt-
out rights; and (2) the group nature of the remedy ensures that the class remains “homogenous and
cohesive.”27 Allison, 151 F.3d at 413, 415 (noting that “as claims for individually based money
damages begin to predominate, the presumption of cohesiveness decreases”). Therefore, Rule
23(b)(2) class certification is inappropriate where the monetary relief requires “a specific or

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28 Part IIIB of the majority opinion concedes that the individual issues in this case have diminished the
cohesiveness of the class to the point where notice and opt-out rights are necessary.
18
time-consuming inquiry into the varying circumstances and merits of each class member’s individual
case.” Id.
Under the test articulated in Allison, it is clear that Rule 23(b)(2) class certification is inappropriate
in this case. First, the majority opinion suggests that notice and opt-out rights are necessary: “Under
our precedent, should the class be certified on remand, class members must be provided adequate
notice, and the district court should consider the possibility of opt-out rights.”
Second, a uniform group remedy is not possible in this case because Plaintiffs seek individualized
remedies based on the specific characteristics of each policy and policyholder.28 Plaintiffs concede that
the “amount of the awards vary” based on “factors including the premium rates charged to African-
Americans and Caucasians, the issue ages for each policy, and the benefits provided.” Monetary relief
in a Rule 23(b)(2) class action should not be “dependent in any significant way on the intangible,
subjective differences of each class member’s circumstances.” Allison, 151 F.3d at 415; Bolin v.
Sears, Roebuck & Co., 231 F.3d 970, 975 n.22 (5th Cir. 2000) (stati ng that Rule 23(b)(2) was
created to address “group, as opposed to individual[,] injuries”). Therefore, Rule 23(b)(2) class
certification is inappropriate here.
Review of the record provides further evidence that Rule 23(b)(2) class certification is
inappropriate. Plaintiffs seek: (1) an injunction prohibiting the collection of discriminatory premiums;
(2) reformation of existing policies to equalize benefits; and (3) restitution of past premium
overcharges or benefit overpayments. The parties appear to agree that: (1) the basis of Plaintiffs’ suit
is the issuance of hundreds of different indust rial life insurance policies by several hundred

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19
Defendants over a period of 50 to 65 years; (2) Defendants ceased issuing such policies in the mid-
1970s (or, at the latest, the early 1980s); (3) many, if not most, of the industrial life insurance policies
are no longer in effect; and (4) a large number of the remaining policies have been modified to some
extent by Plaintiffs or Defendants. In this light, the first and second remedies sought by Plaintiffs
would seem to be of little consequence to many, if no t most, Plaintiffs because the injunction and
reformation would only affect those Plaintiffs who still hold industrial life insurance policies that have
remained largely unaltered for over 20 years (and up to 75 years). For Plaintiffs who do not fit into
this category, the only relief would be monetary in nature: the restitution of past premium
overcharges or benefit overpayments.
In sum, the factual basis of Plaintiffs’ suit indicates that injunctive or declaratory relief does not
predominate and that the monetary relief is not incidental. McManus, 320 F.3d at 553-54 (concluding
that the factual basis of plaintiffs’ suit was “markedly different from the paradigm Rule 23(b)(2) class
action,” and thus class certification under Rule 23(b)(2) was inappropriate); James v. City of Dallas,
254 F.3d 551, 572 (5th Cir. 2001) (analyzing the factual basis of plaintiffs’ suit and concluding that
class certification was appropriate). As this Court stated in McManus, permitting this case to be
certified under Rule 23(b)(2)
would undo the careful interplay between Rules 23(b)(2) and (b)(3) [because] the class members
would potentially receive a poor substitute for individualized money damages, without the
corresponding notice and opt-out benefits of Rule 23(b)(3)[,] and defendants would potentially
be forced to pay what is effectively money damages, without the benefit of requiring plaintiffs to
meet the rigorous Rule 23(b)(3) requirements.
320 F.3d at 554. This Court should not allow plaintiffs “to shoehorn damages actions into the Rule

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29 Part IIIB of the majority opinion indicates that: (1) it is “futile” to inquire whether injunctive/declaratory
or monetary relief predominates in a class action, and (2) “the [R]ule 23(b)(2) and (b)(3) devices may work
in tandem,” even when the plaintiffs have only sought certification under Rule 23(b)(2). In effect, the majority
opinion suggests that courts are free to certify class actions as they wish, without regard to the character of the
class action or the strictures of Rule 23. Such avoidance of the rules governing class certification contravenes
both the intent of Rule 23 and the caselaw of this Court. Allison, 151 F.3d at 415 n.9 (“[O]ur cases have
adopted the position taken by the Rule 23 advisory committee that monetary relief may not be sought in a (b)(2)
class action if it predominates over the requested injunctive or declaratory relief.”); McManus, 320 F.3d at 554.
20
23(b)(2) framework” and thus blur the distinctions between the different types of class actions.29
Bolin, 231 F.3d at 976. Therefore, I respectfully dissent.

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21

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