Recent Guidance on the Florida Economic Loss Rule and Motion to Strike Class Allegations
The United States District Court for the Southern District of Florida recently addressed two important legal issues: (1) interpretation of Florida’s Economic Loss Rule and (2) the framework for addressing a motion to strike class allegations under Fed. R. Civ. P. 12(f). In Gill-Samuel v. Nova Biomedical Corp., Case No.: 13-62591, 2014 WL 1661496 (S.D. Fla. April 8, 2014) (Gill-Samuel v Nova), the plaintiff filed her complaint following the defendant’s recall of prescription blood testing strips due to artificially high blood-glucose readings. As a result of using the recalled blood testing strips, Plaintiff alleged that she tested positive for a high blood-glucose level and, therefore, incurred additional healthcare costs because she went to the hospital for follow-up treatment. When she was examined at the hospital, however, her levels were normal. In addition to her individual claim, Plaintiff also purported to bring the action on behalf to two classes: 1. “[a]ll persons who purchased [the blood strips] subject to the recall” and 2. “[a]ll –persons who purchased [the blood strips subject to the recall] and incurred additional medically related expenses because of the strips’ improper test results.” The defendant moved to dismiss all claims pursuant to the Economic Loss Rule and to strike the class allegations pursuant to Rule 12(f).
The Court denied the motion to dismiss Plaintiff’s individual claim because her claims did not invoke the Economic Loss Rule. Contrary to the defendant’s assertion, Plaintiff’s individual injury did “not solely arise from a depressed economic expectation concerning test strips that she expected to be functional but that may have been defective. Instead, Plaintiff alleges that she incurred unnecessary medical treatment as a result of the defective product’s faulty blood-glucose reading.” The Court, however, did grant the motion to dismiss as to the first proposed class because “the only injury suffered by the first group is injury to the product itself,” and therefore, those claims were barred by the Economic Loss Rule.
The Court denied defendant’s motion to strike the class action allegations. In its motion brought pursuant to Rule 12(f), Defendant essentially sought a denial of class certification. The Court struggled with determining the standard under which to address a Rule 12(f) motion to strike class allegations – whether to analyze the motion under Rule 23 or confine its analysis to the strictures of Rule 12(f). The Court ultimately determined that “though [Defendant] invites the Court to analyze its Motion to Strike entirely under the rubric of a Rule 23 motion, the court deems it proper, instead, to view the Rule 23 factors through the lens of the Rule 12(f) standard for motion to strike.” Because Plaintiff’s class-action allegations were not “redundant, immaterial, impertinent, or scandalous” in violation of Rule 12(f), the Court denied the motion.