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Courts routinely refuse to certify consumer class actions under Federal Rule of Civil Procedure 23(b)(3) based on the need for an individualized showing of the reliance element of a fraud or deceptive trade practices claim. But many plaintiffs’ counsel have argued, sometimes successfully, for a different outcome when pursuing claims under state consumer protection statutes that do not contain an express reliance element. A recent decision from the Sixth Circuit illustrates how the same reliance arguments may still apply to defeat certification even when reliance is not an explicit element of the claim. 

In re Nissan North America, Inc. Litigation, —F.4th—, 2024 WL 4864339 (6th Cir. Nov. 22, 2024), involved an interlocutory appeal from a district court order certifying ten statewide classes of Nissan owners who alleged that their vehicles’ automatic electronic braking systems were defective. The plaintiffs asserted claims for breach of warranty, fraud, unjust enrichment, and violation of their states’ consumer protection statutes. In certifying the proposed classes, the district court held that the common issue of whether the vehicles’ braking systems were in fact defective predominated over any individualized issues. The Sixth Circuit reversed.

In an opinion authored by Chief Judge Sutton, the court of appeals held that the district court abused its discretion by failing to properly identify a question of law or fact that was common to all class members. The court first explained that identifying a common question of law or fact requires the district court to “walk through each cause of action, identify the relevant elements, and evaluate which elements, if any, submit to common answers” — in other words, which elements “allow a decisionmaker to reach a yes-or-no answer for the class in one stroke.” Id. at *3 (citation and internal quotation marks omitted).

The court then identified “two over-arching flaws” in the district court’s analysis. Id. at *4. First, the district court had not considered that software upgrades may have remedied the alleged flaws in the braking systems of some class members’ vehicles, thus calling into question “whether the existence of a defect can be established in one stroke.” Id. While this alone required vacating the district court’s certification order and remanding the case for further proceedings, the court went on to discuss a second flaw in the district court’s analysis: “failure to analyze the elements of each state law claim to determine which, if any, elements would yield common yes-or-no answers.” Id. As part of this discussion, the court provided “a few representative examples of the state-law claims filed in this class action and the kinds of questions the parties and district court must ask and answer on remand as to whether those questions are ‘common’ or ‘individualized’ ones.” Id. at *5.

One of the claims that the court highlighted was for violation of the Illinois Consumer Fraud Act (ICFA), 815 ILCS 505/1 et seq. While reliance is not an express element required to plead a claim under the ICFA, proximate cause is. See Connick v. Suzuki Motor Co., 675 N.E.2d 584, 593 (Ill. 1996) (“Plaintiff’s reliance is not an element of statutory consumer fraud, but a valid claim must show that the consumer fraud proximately caused plaintiff’s injury.” (internal citations omitted)). And as the Illinois Supreme Court has explained, proximate cause requires proof that the plaintiff was “actually … deceived by a statement or omission that is made by the defendant.” De Bouse v. Bayer, 922 N.E.2d 309, 316 (Ill. 2009). “If a consumer has neither seen nor heard any such statement, then she cannot have relied on the statement and, consequently, cannot prove proximate cause.” Id.

Citing this authority from the Illinois Supreme Court, the Sixth Circuit observed that individualized questions could preclude certification with respect to the plaintiffs’ ICFA claim because “[r]eliance tends to turn on individualized circumstances.” In re Nissan, 2024 WL 4864339, at *6. For example, “[i]f a consumer ‘has neither seen nor heard’ the statement or ignored it, it may be difficult to show they have been harmed by it (or for that matter relied on it).” Id. (quoting De Bouse, 922 N.E.2d at 316). And “[e]ven if each consumer experiences the same deceptive statement, they may experience it differently in making individual purchasing decisions.” Id. In other words, individualized questions of reliance may predominate — and preclude certification — even though reliance is not an express element of the claim. 

In re Nissan serves as an important reminder that individualized questions of reliance may defeat certification under Rule 23(b)(3) even if the plaintiff is asserting a claim under a state consumer protection statute that does not have reliance as an explicit element. For any statutory consumer fraud claims, careful consideration should be given to whether individualized inquiries are needed to prove that each class member in fact saw or heard and was harmed by the allegedly deceptive act or statement.