Colorado Supreme Court Opinions
October 31, 2011
No. 09SC1080. Garcia v. Medved Chevrolet, Inc.
Class Actions—Burden of Proof—Circumstantial Evidence—Inference or Presumption—Colorado Consumer Protection Act.
Applying the standards enunciated in Jackson v. Unocal Corp. (Oct. 31, 2011, No. 09SC668), the Supreme Court concluded that the trial court failed to rigorously analyze the evidence in deciding to grant class certification. The Court therefore affirmed the court of appeals’ decision remanding the case to the trial court to conduct such an analysis.
Consistent with its opinion in BP America Production Co. v. Patterson, 185 P. 3d 811 (Colo. 2008),the Court held that the causation and injury elements of plaintiffs’ Consumer Protection Act claims may be inferred from circumstantial evidence common to the class. The Court further held that defendant has the opportunity to rebut such class-wide inferences with individual evidence. The Court concluded that, in its analysis, the trial court neglected to consider the evidence offered by defendant to refute plaintiffs’ class-wide theories of liability.
No. 09SC668. Jackson v. Unocal Corp.
Civil Procedure—Class Actions—Burden of Proof—Expert Disputes.
In the lead case in a series of four class action cases, the Supreme Court addressed the standards a trial court must apply when deciding whether to certify a class pursuant to C.R.C.P. 23. The Court declined to adopt a specific burden of proof and therefore reversed the court of appeals’ decision holding that a trial court must apply a preponderance of the evidence standard to C.R.C.P. 23’s class certification requirements. Instead, the Court held that a trial court must rigorously analyze the evidence presented and determine to its satisfaction that each C.R.C.P. 23 requirement is met.
The Court also considered whether a trial court may resolve factual or legal disputes relevant to class certification where those disputes independently overlap with the merits. The Court held that a trial court may consider factual or legal disputes to the extent necessary to satisfy itself that the requirements of C.R.C.P. 23 have been met, but may not resolve factual or legal disputes to screen out or prejudge the merits of the case. The Court extended this holding to expert disputes, such that a trial court may consider expert disputes in determining whether class certification is appropriate, but need not determine which expert will prevail at trial or whether an expert’s testimony ultimately will be admissible at trial.
No. 10SC214. BP America Production Co. v. Patterson.
Class Actions—Burden of Proof—Circumstantial Evidence—Inference or Presumption—Fraudulent Concealment.
Applying the standards enunciated in Jackson v. Unocal Corp. (Oct. 31, 2011, No. 09SC668), the Supreme Court affirmed the trial court’s decision to grant class certification. The Court held that the ignorance and reliance elements of fraudulent concealment may be inferred from circumstantial evidence, enabling plaintiffs to establish a theory of fraudulent concealment on a class-wide basis with evidence common to the class. The Court also held that a defendant may introduce individual evidence to rebut such a class-wide inference. The Court concluded that the trial court rigorously analyzed all the evidence presented in support of and in opposition to class certification, as required by Jackson.
No. 10SC220. Huber, Exec. Dir., Colorado Dep’t of Revenue v. Colorado Mining Assoc.
CRS § 39-29-106—Amendement 1—Colo. Const. art. X, § 20—Taxation—Prospective Application of Constitutional Amendment.
The Supreme Court held that statewide voter approval is not required when the Department of Revenue implements quarterly adjustments to the tax due per ton of coal extracted from Colorado lands as required by CRS § 39-29-106. The court of appeals’ judgment was reversed.
The General Assembly adopted the coal severance tax of CRS § 39-29-106 in 1988, before approval of Amendment 1, Colo. Const. art. X, § 20. Amendment 1 requires advance voter approval for new taxes, tax rate increases, and tax policy changes that directly cause net revenue gains. CRS § 39-29-106 establishes a tax rate with two components to calculate the severance tax owed: (1) a base rate of $0.36 per ton of coal extracted; and (2) a quarterly 1% increase or decrease to the base rate calculated by changes to the index of producers’ prices, a federally prepared economic index that roughly tracks inflation.
After Amendment 1 became effective, the Department of Revenue suspended implementation of the statutorily required quarterly adjustments to the tax due, leaving in place a tax of $0.54 per ton of coal extracted. In 2007, the Department of Revenue concluded that implementation of the two-part tax rate formula was non-discretionary and did not conflict with Amendment 1, and it adjusted the tax due to $0.76 per ton. The court of appeals concluded that each time the Department of Revenue calculates an upward adjustment in the tax due, Amendment 1 requires statewide voter approval.
The Supreme Court concluded that Amendment 1 is prospective in application and that implementation of the two-part tax rate formula in CRS § 39-29-106 (the base rate plus the non-discretionary adjustment factor) is not a “tax rate increase.” Instead, collection of the tax as prescribed is a non-discretionary duty required of the Department of Revenue by a taxing statute that is not subject to Amendment 1’s voter approval requirements. Because the Department of Revenue has no discretion to increase or alter the tax rate formula of CRS § 39-29-106, Amendment 1’s prospective check on the legislature does not apply.
No. 10SC77. State Farm Mutual Ins. Co. v. Reyher.
Class Actions—Class Certification—Burden of Proof—Colorado Automobile Accident Reparations Act.
Applying the standards enunciated in Jackson v. Unocal Corp. (Oct. 31, 2011, No. 09SC668), the Supreme Court affirmed the trial court’s decision to deny class certification, thereby reversing the court of appeals’ judgment. The Court concluded that the trial court rigorously analyzed plaintiffs’ class-wide theories of liability, as well as the evidence offered by defendant to refute those theories in determining that the predominance of individual issues precluded class certification.
Colorado Supreme Court Opinions