Class Certification Order

On December 5, 1997, the Circuit Court of Williamson County, Illinois certified the issues in this suit for trial as a Class Action. On February 11, 1998 the Court by order, changed this order to reflect the addition of a definition for Crash Parts. The Court's Certification order now reads as follows:

TAMMY SNIDER and MICHAEL AVERY, On Behalf of Themselves and All Others Similarly Situated,	) ) ) )	No. 97-L-114 CLASS ACTION
Plaintiffs,	)
vs.	) ) )
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY,	) ) ) )
Defendant,	) )

I. SUMMARY OF THE CASE

The representative plaintiffs ("Plaintiffs") in this class action allege that defendant State Farm Mutual Automobile Insurance Company ("State Farm") has breached its contract with its auto insurance policyholders, and violated the provisions of Illinois' Consumer Fraud and Deceptive Business Practices Act (the "CFA"), 815 ILCS 505/1 et seq. Plaintiffs seek certification of a class (the "Class") composed of:

All persons in the United States, except those residing in Arkansas and Tennessee, who (1) were insured by a vehicle casualty insurance policy issued by Defendant State Farm and (2) made a claim for vehicle repairs pursuant to their policy and had imitation that is, non­factory­authorized and/or non­OEM parts installed on their vehicles or else received monetary compensation determined in relation to the cost of imitation parts. Excluded from the class are employees of Defendant State Farm, its officers, its directors, its subsidiaries, or its affiliates.

In addition, the following persons are excluded from the class: (1) persons who resided in Illinois and whose policies were issued/executed prior to April 16, 1994, and (2) persons who resided in California and whose policies were issued/executed prior to September 26, 1996.

Plaintiffs' claims concern contractual language in standard form State Farm automobile insurance policies issued nationwide. This language either obligates State Farm to restore a policyholder's vehicle to "its pre-loss condition" after an accident, or for State Farm to "pay to repair or replace the property or part with like kind and quality." While State Farm has designed form policies specific to each state, the contractual obligations at issue in this case are stated in substantially identical form in State Farm policies issued nationwide.

Notwithstanding this language, State Farm's uniform policy specifies the use of certain non-original equipment manufacture (non-OEM) replacement parts (referred to as "quality replacement parts" by State Farm and "imitation parts" by Plaintiffs) when these parts are priced lower than original equipment manufacturer's (OEM) parts. Whether this policy violates the above-referenced provisions of State Farm's insurance contracts with its policyholders is the central issue of this litigation.¹

In their Second Amended Class Action Complaint (the "Complaint"), their submissions, and their arguments before the Court, Plaintiffs contend that non-OEM parts are neither of "like kind and quality," nor are they sufficient to restore a policyholder's vehicle to its "pre-loss condition." For this reason, Plaintiffs contend that State Farm has breached its contract with its policyholders. Plaintiffs seek damages for breach of contract and for State Farm's alleged violation of CFA. Plaintiffs also seek equitable relief against State Farm as set forth in Plaintiffs' Complaint.

State Farm contends that non-OEM parts (particularly those certified by the Certified Auto Parts Association ("CAPA")) are of "like kind and quality" to OEM parts, and that they fully restore a policyholder's vehicle to its "pre-loss condition." State Farm also contends that its policyholders are informed whenever non-OEM parts are used, and that its use of the term "quality replacement parts" is not misleading.

II. GOVERNING LEGAL STANDARD

Certification of a class action in the State of Illinois is governed by 735 ILCS 5/2-801, which provides as follows:

An action may be maintained as a class action in any court of this State and a party may sue or be sued as a representative party of the class only if the court finds:

(1) The class is so numerous that joinder of all members is impractical.

(2) There are questions of fact or law common to the class, which common questions predominate over any questions affecting only individual members.

(3) The representative parties will fairly and adequately protect the interests of the class.

(4) The class action is an appropriate method for the fair and efficient adjudication of the controversy.

Plaintiffs request class certification under 5/2-801. The Court has carefully considered the testimony adduced over the course of the evidentiary hearing on class certification conducted in November, 1997, the affidavits filed by Plaintiffs and State Farm, the pleadings and briefs submitted to the Court, the voluminous exhibits introduced at the certification hearing, and the arguments by counsel. See Gordon v. Boden, 224 Ill. App. 195, 199, 586 N.E.2d 461, 464 (1991). In considering class certification the Court has assigned to Plaintiffs the burden of satisfying the four requirements of 5/2­801. Wheatley v. Board of Ed. of District 205, 99 Ill. 2d 481, 486, 459 N.E.2d 1364, 1367 (1984). The Court has not considered the possibility of success on the underlying merits, but only whether the statutory requisites for class certification are satisfied at this time. See Purcell & Wardrope Chartered v. Hertz Corp., 175 Ill. App. 3d 1069, 1075, 530 N.E. 2d 994, 998 (1988)("hypothetical problems that may arise in the future***[are] not a sufficient basis to refuse to certify an otherwise properly pleaded class action.") Applying this standard, the Court makes the following findings of fact, and the following conclusions, with respect to each of the four statutory requirements for certification of a class action in Illinois.

III. CERTIFICATION ISSUES

A. Numerosity and Impracticality of Joinder

735 ILCS 5/2-801(1) requires not only that the number of plaintiffs be numerous, but also that joinder of plaintiffs in one individual action be impractical. "In general the question of numerosity depends on the particular facts of each case and no arbitrary rules regarding the size of class have been established by the courts." In re Application of Edward J. Rosewell, 236 Ill. App.3d 165, 174, 603 N.E. 2d 681, 686 (1992). Where there are a number of potential claimants, and the individual amount of each claim is small, making redress on an individual level difficult, if not impossible, Illinois courts have been particularly receptive to proceeding on a class action basis. Miner v. Gillette Co., 87 Ill. 2d 7, 428 N.E. 2d 478 (1981), cert. dismissed, 459 U.S. 86 (1982).

Testimony at the certification hearing indicates that State Farm's practice of using non-OEM parts affects a large number of policyholders. State Farm is the largest auto insurer in the United States, with over 34 million auto policies in effect nationwide. Affidavit of Kathleen M. Pechan, Defendant's Exhibit 8, p. 3. State Farm paid approximately 5.1 million separate collision and comprehensive claims in 1996. Affidavit of David W. Gibson, Jr., Defendant's Exhibit 5, p. 3. In 1993, 49.4% of State Farm's repair estimates nationwide included CAPA certified non-OEM parts. Plaintiffs' Exhibit 177. It is clear from the exhibits introduced by both Plaintiffs and State Farm that millions of people are affected by State Farm's current claims settlement practices. The Court therefore finds the potential class members are sufficiently numerous.

In reaching its determination that joinder is impracticable the Court is guided by the number of potential class members. The Court finds that, first, the potential class members are widely distributed. Second, the class is large and its members cannot be easily identified, located and informed of the pendency of this action for purposes of formal joinder. Third, the potential class members are average consumers, not "sophisticated" entities. Fourth, the individual damages alleged in this action are, for the most part, small. They involve accelerated vehicle deterioration after repair, inferior fit and finish of repaired areas, and loss of value at resale. The dollar value of individual claims, although not nominal, is not large. See, e.g., Plaintiffs' Exhibit 94 ($1,670 diminution in value upon resale when non-OEM parts used). Finally, it should be noted that this is the type of consumer class action on behalf of smaller claimants to which Illinois courts have been particularly receptive. Gordon, 224 Ill. App. 3d at 204, 586 N.E.2d at 467.

The Court finds that more localized litigation, either on an individual or localized class basis, would be a waste of scarce judicial resources both in this and other states. Addressing the common issues in one litigation would aid judicial administration. Therefore, the Court finds that requirements for certification of a class action under 5/2-801(1) are satisfied.

B. Common Questions of Fact or Law

735 ILCS 5/2-801(2) requires that there be "questions of fact or law common to the class." However, "[c]ertification require[s] only that there be either a predominating common issue of law or fact, not both." Martin v. Heinold Commodities, Inc., 117 Ill. 2d 67, 81 510 N.E. 2d. 840, 846 (1987). While Plaintiffs must demonstrate that the common questions predominate over individual issues,

"the hypothetical existence of individual issues is not a sufficient reason to deny the right to bring a class action. Where it appears that the common issue is dominant and pervasive, something more than the assertion of hypothetical variations of a minor character should be required to bar the action."

Harrison Sheet Steel Co. v. Lyons, 15 Ill. 2d 532, 538, 155 N.E. 2d 595, 598 (1959). Common questions arising from the interpretation of standard contract provisions or other uniform documents may be found to predominate; accordingly, the inability of some members of the class to obtain relief due to particular factors unique to them, is to be resolved at trial and does not impair certification of the class. Steinberg, 69 Ill. 2d at 338, 371 N.E. 2d at 643; Rosen v. Village of Dowwer's Grove, 19 Ill. 2d 448, 456, 167 N.E. 2d. 230, 235 (1960).

Testimony at the class certification hearing highlighted the common factual pattern in this case. James Ford, employed by State Farm as a divisional claims superintendent, testified that State Farm's claims policies are communicated through a series of "general claims memos" issued from State Farm's headquarters in Bloomington, Illinois, which governs claims policy nationwide. Certification Hearing at 0120-0124. General Claims Memo #430, introduced at the hearing as Defendant's Exhibit 23, governs the use of non-OEM parts.

In resolving customer claims, an estimate is prepared at a local State Farm claims office. When a particular part is needed to complete a repair, the part number is input into a computer program. This program contains a database maintained by, respectively, Mitchell, C.C.C. or A.D.P, Id. at 0142, which contains information on the availability of, and price for, various parts from suppliers State Farm has approved. Id. at 0144. The computer's software then automatically searches what was referred to as "the matrix," and locates the cheapest available part. Id. at 0143-44. This part, whether it is an OEM or non-OEM part, is then automatically specified on the repair estimate. Id. at 0143­44. The State Farm adjuster has no authority to override the computer's choice of the cheapest part. Id. at 0153-54. It appears that this practice is uniform throughout the United States wherever non-OEM parts are used. Id. at 0155. Defendant's Exhibit 23. The policyholder is neither informed, nor consulted when a non-OEM part is specified. Certification Hearing at 0132. If the policy holder does not want non-OEM parts placed on their car, they must convince a body shop to absorb the price difference, or pay for the difference in price themselves. Id. at 0151.

As to the consumer fraud allegations, the facts presented at the certification hearing on State Farm's methods of disclosing to policyholders its use of non-OEM parts also demonstrates a course of conduct common to all class members. When such parts are used on an estimate, the policyholder is given a State Farm brochure discussing the use of non-OEM parts. Defendant's Exhibit 24; Certification Hearing at 0124-25. The estimate is then stamped indicating the use of non-OEM parts. Defendant's Exhibit 27. State Farm has also promoted the use of the term"quality replacement parts" nationwide in an effort to promote its substitution of non-OEM for OEM parts. Plaintiffs' Exhibits 115, 116.

The Court finds that the evidence introduced at the certification hearing demonstrate "a series of essentially identical transactions," Miner, 87 Ill. 2d at 19, 428 N.E. 2d at 484, between State Farm and its insureds, which transactions routinely result in the use of non-OEM parts.

In reaching its conclusion that the class claims are essentially factually identical, the Court acknowledges the significant evidence presented at the hearing regarding the varying availability and use of non-OEM parts in each of State Farm's regional offices. Affidavit of David A. Gibson, Jr., Defendant's Exhibit 5; Certification Hearing at 0121, 0124. The Court notes that varying availability of non-OEM parts affects how many policyholders did or did not receive non-OEM parts, but it does not affect the common pattern with respect to class members, who always received such parts if they were available. Any person whose car was repaired only with OEM parts is not part of the class for which certification is sought. Therefore, any variations in OEM part use is irrelevant to certification.

Given State Farm's common and ongoing course of conduct in repairing its insureds' vehicles with cheaper non-OEM parts whenever these parts were available, potential class members have a common interest in determining State Farm's obligations under its contractual provisions. "A class action can properly be prosecuted where a defendant is alleged to have acted wrongly in the same basic manner as to an entire class. In such circumstances, the common class questions still dominate the case." Brooks v. Midas-International Corp., 47 Ill. App. 3d 266, 273, 361 N.E. 2d 815, 820 (1977). Here the class members have a common interest in determining if State Farm's policy violates its contractual obligations, and this issue of contractual interpretation predominates over other issues. See, e.g., Carrao v. Healthcare Service Corp., 118 Ill. App. 3d 417, 428, 454 N.E. 2d 781, 790 (1983). Similarly, the question of whether State Farm's practice of using non-OEM parts constitutes a violation of the CFA is a common issue appropriate for resolution. See, e.g., Brooks, 47 Ill. App. 3d at 272, 361 N.E. 2d at 820.

In determining if this common question predominates, the Court has carefully considered State Farm's contention that it has no standard form auto insurance policy, as each individual state's policy is tailored to comply with the requirements of that state. See Affidavit of Everett J. Truttmann, Defendant's Exhibit 9. Therefore, State Farm contends there is no common question to be interpreted. The Court finds, however, that the policies' specific form is immaterial, provided that the operative contractual language contained in each policy is susceptible to uniform interpretation. Whether particular language in its policies authorizes State Farm's use of non-OEM parts or is in conflict with the "like kind and quality" or "pre-loss condition" language of the policies is not a question to be resolved during class certification. It is a question for resolution on the merits.

State Farm has placed particular emphasis on its practice of using CAPA-certified non-OEM parts. Under this practice, State Farm will specify only a CAPA-certified part in place of an OEM part when that type of part was subject to CAPA certification. Affidavit of David A. Gibson, Jr., Defendant's Exhibit 5, p. 8. Although considerable testimony was received as to the difference between CAPA-certified non-OEM parts, non-CAPA-certified non-OEM parts, and OEM parts, this testimony all addresses the merits of whether non-OEM parts satisfy State Farm's contractual obligations. This ultimate issue is irrelevant to class certification, where the common treatment of the class members in having received non-OEM parts is the central question.

The Court heard substantial testimony as to the number of different non-OEM parts. Since the Court finds that a common question concerning the use of non-OEM parts has been established, the number of different parts and their relative quality is a question that goes to the merits of whether non-OEM parts are equal to OEM parts. Plaintiffs' submissions that non-OEM parts are categorically inferior in performance and safety, because of inferior design, manufacture and quality control, and evidence that they are commonly perceived by the marketplace as inferior, with a resulting negative effect on policyholders' cars' ultimate resale value are factors in the Court's determination that the requirements of 2-801(2) have been established.

In Phillips Petroleum Co. v. Shutts, the United States Supreme Court discussed the constitutional limitations on the application of a particular state's substantive law to the claims of out-of-state plaintiffs, finding that a state may apply its substantive law beyond its borders where it has "'significant contact or aggregation of contacts' to the claims asserted by each member of the plaintiff class, contacts 'creating, state interests'*** insur[ing] that the choice of [ law] is not arbitrary or unfair." 472 U.S. 797, 821-22, 105 S. Ct. 2965, 2979 (1985) (quoting Allstate Ins. Co. v. Hague, 449 U.S. 302, 312-12, 101 S. Ct. 633, 640 (1981)). Illinois courts have approved the application of the CFA, § 815 ILCA 505/1 et seq., to the claims of out-of-state plaintiffs. See, e.g., Gordon, 224 Ill. App. 3d at 202-03, 586 N.E. 2d at 466; Martin 117 Ill. 2d 67, 510 N.E.2d 840. In Martin, a class composed of in state and out-of-state plaintiffs sued an Illinois corporation for fraud and for violations of the Illinois CFA. Relying upon Phillips, the Illinois Supreme Court noted that defendant's principal place of business was Illinois and stated:

"Applying the Phillips Petroleum standard to the instant case, it is apparent that Illinois substantive law can be applied to resolve the underlying common factual dispute. Here each member of the plaintiff class asserts the same breach of defendant's fiduciary duty with regard to the same nondisclosure of the same fact. This common allegation implicates the legitimate interests of the State of Illinois in insuring that persons and entities within its jurisdiction, insofar as they undertake to act as agents, do so in accordance with its law." 117 Ill. 2d at 82, 510 N.E.2d at 847.

The Illinois Supreme Court concluded that "there can be no doubt that the claim of each member of the plaintiff class implicates the legitimate interests of Illinois in applying its law to adjudicate a dispute involving a business principally situated in its jurisdiction and which, by its own efforts, insistently has sought to avail itself of both the courts and the laws of the forum State." 117 Ill. 2d at 83, 510 N.E. 2d at 847. Under Phillips and Martin, given the fact that State Farm is situated and headquartered in Illinois and affirmatively uses Illinois courts and law, this Court could apply Illinois substantive laws, including the CFA to the entire class.

While it is not necessary for the Court at this time to decide upon choice of law as to the breach of contract claim, it does note that the eventual decision as to choice of law will not prevent the certification of the Class in this case. Gordon, 224 Ill. App. 3d at 202, 586 N.E. 2d at 466. The Court retains the right to divide the litigation into a manageable number of sub­classes under 2-802(b) should differences in law present themselves. The Court finds that the requirements of Section 2­801(2) are met as "common issues of fact or law predominate."

C. The Representative Plaintiffs Fairly and Adequately Protect the Interest of the Class

735 ILCS 5/2-801(3) conditions class certification upon a finding that "[t]he representative parties will fairly and adequately protect the interest of the class." "The purpose . . . of the adequate representation requirement is merely to ensure that all class members will receive proper, efficient, and appropriate protection of their interests in the presentation of the claim." Gordon, 224 Ill. App. at 203, 586 N.E. 2d at 466. Judicial evaluation of the quality of the representation, as well as class certification in general, rests within the sound discretion of the trial court. McCabe v. Burgess, 75 Ill. 2d 457, 389 N.E. 2d 565, 568 (1979).

Adequate representation assures compliance with due process requirements. "The test applied to determine the adequacy of representation is whether the interests of those who are parties are the same as those who are not joined and whether the litigating parties fairly represent those not joined." Miner, 87 Ill. 2d at 14, 428 N.E.2d at 482. Essentially, the determination focuses on whether the absentee members are so represented by the persons before the court "that their interests will receive actual and efficient protection." Brooks, 47 Ill. App. 3d at 274, 361 N.E. 2d at 820, quoting State Life Insurance Co. v. Board of Education, 394 Ill. 301, 308, 68 N.E.2d 525, 529 (1946). Finally, unlike in Federal Rule of Civil Procedure 23, there is no "typicality" requirement in 5/2-801(3). The Illinois rule is more liberal than the federal rule in this regard and ". . . a class representative may not be disqualified merely because his claim is not exactly the same as the claims of other potential class members." Carrao, 118 Ill. App. 3d at 428, 454 N.E.2d at 790. The Court finds that the requirement of adequate representation under 735 ILCS 5/2-801(3) has been satisfied.

After a rigorous analysis of Plaintiffs' Complaint, Plaintiffs' affidavits and Plaintiffs' counsels' affidavits or résumés, the Court concludes that Plaintiffs have zealously pursued their claims since learning of State Farm's alleged wrongful conduct and that Plaintiffs have sufficient financial resources to absorb the expenses involved in being the named representatives. The Court further finds that no conflicting interests exist between Plaintiffs and the Plaintiff Class as it is clear from the Court's review of the material submitted in support of class certification that the representatives herein and Class members share common objectives and legal and factual positions. Other than the dates and specific amounts concerning Plaintiffs' repairs and Class members' repairs, the proof, objectives, legal and factual positions will be essentially identical from plaintiff to plaintiff and class member to class member.

In determining the adequacy of representation, the Court may also consider the quality and experience of the attorneys for the Class. The Court finds, after a rigorous analysis and review of the pleadings and résumés submitted by Plaintiffs' counsel and having observed their conduct in open Court, that they are able advocates for the Class. Counsel for Plaintiffs have regularly engaged in major complex consumer litigation of size, scope and complexity similar to this case. Counsel have successfully prosecuted many and varied class actions or other complex litigation. They have the experience and sophistication that the Plaintiffs and Class members lack. The Court finds that counsel for Plaintiffs are well suited for this case and that Plaintiffs will fairly and adequately protect the interest of the Class in compliance with the mandate of 735 ILCS 5/2­801(3).

D. The Class Action Is an Appropriate Method to Resolve the Class Issues

735 ILCS 5/2-801(4) conditions class certification on a finding that "[t]he class action is an appropriate method for the fair and efficient adjudication of the controversy." In applying the fourth prerequisite, the Court has considered whether a class action can best secure economies of time, effort, and expense and promote uniformity of decision or accomplish other ends of equity and justice. Gordon, 224 Ill. App. 3d at 203, 586 N.E.2d at 467. While Federal Rule of Civil Procedure 23(b)(3) requires that a class action be superior to other available methods of adjudication, the Illinois statute requires that the trial court find that the class action is an appropriate method of litigating the controversy. Section 5/2­801(4). This standard allows the trial court a more flexible measure of discretion in determining whether to permit the class action to proceed. A significant factor in the case at bar is that a class action is the only practical means for State Farm policyholders to present their claims and for State Farm to achieve finality as to their claims.

Illinois courts have historically recognized that class actions are an appropriate method of fairly and efficiently adjudicating controversies involving numerous small claims. In Wood River Area Development Corporation v. Germania Federal Savings and Loan, 198 Ill. App. 3d 445, 452; 555 N.E.2d 1150, 1154 (1990), the Court stated "[t]he class action is particularly appropriate where those who have allegedly been injured 'are in poor position to seek legal redress, either because they do not know enough or because such redress is disproportionately expensive.' . . . Its 'historic mission' has been to take care of the smaller guy." The Wood River court concluded,

"No matter how refined, how revised, or how evolved" [the class action becomes], ". . . the goal of the class action remains the same - justice for the lowly, the tenants, the parishioners, the multitudes." 198 Ill. App. 3d at 448, 555 N.E.2d at 1152.

The United States Supreme Court recently acknowledged not only the appropriateness, but the necessity, of class treatment of small consumer claims in AmChem Prods. Inc. v. Windsor, ___ U.S. ___, 117 S. Ct. 2231, 2250 (1997), stating,

"Predominance is a test readily met in certain cases alleging consumer or securities fraud or violations of the antitrust laws."

With respect to "small claims" class actions in general, the Court stated:

"The policy at the very core of the class action mechanism is to overcome the problem that small recoveries do not provide the incentive for any individual to bring a solo action prosecuting his or her rights. A class action solves this problem by aggregating the relatively paltry potential recoveries into something worth someone's (usually an attorney's) labor. 117 S. Ct. at 2246, quoting Mace v. Van Ru Credit Corp., 109 F.3d 338, 344 (7th Cir. 1997).

The evidence presented to the Court supports the conclusion that, not only is a class action an appropriate method for the fair adjudication of the disputes between Defendant State Farm and its millions of automobile insurance policyholders, but also that it may be the only means by which these disputes may be efficiently resolved.

Defendant State Farm provides automobile insurance coverage to one out of every five insured drivers in the United States, making it the nation's number one auto insurer. Plaintiffs' Exhibit 102. The evidence submitted by Plaintiffs indicates that State Farm achieved a savings of $32 million in 1994 from the use of non-OEM parts. Plaintiffs' Exhibit 92. Accordingly, this action qualifies for class resolution both in terms of the dollar amount in controversy and the number of claims involved.

State Farm has previously settled two lawsuits challenging its non-OEM parts practices - the Illinois case entitled Krusinski v. State Farm, No. 87 CH 10253, in the Circuit Court of Cook County ("Krusinski"), and the California case entitled Krinsk v. State Farm Mutual Automobile Insurance Company, No. 626412, in San Diego County Superior Court ("Krinsk"). Defendant's Exhibit 1. State Farm has settled both the Krusinski and Krinsk actions but has continued its practice of utilizing non-OEM parts in its repairs of policyholders' vehicles. In addition to other relief, Plaintiffs at bar seek an injunction prohibiting State Farm from continuing its practice of settling policyholders' repair claims based upon the use and cost of non-OEM parts.

Proof of Plaintiffs' claims against Defendant State Farm may be made on a class-wide basis. After a rigorous review of the pleadings, exhibits and affidavits submitted by Plaintiffs, the only proof that might differ from Plaintiff to Plaintiff and class member to class member would appear to be the amount of damages suffered by each class member. It is well settled, in Illinois and elsewhere, that differences in the amount of damages suffered by individual class members will not defeat class certification. Gordon, 224 Ill. App. 3d at 202, 586 N.E.2d at 465-66. Individual lawsuits for small amounts would be too expensive, and absent a class action, individual lawsuits run a substantial likelihood of adjudications. Upon consideration of the pleadings, exhibits and affidavits submitted by Plaintiffs, the Court concludes that the proposed Class is manageable. The Court concludes, pursuant to 735 ILCS 5/2­801(4), that a class action is an appropriate method for the for the fair and efficient adjudication of this controversy.

IV. CONCLUSION

Pursuant to 735 ILCS 5/2­801, this Court concludes that Plaintiffs have adequately satisfied the four requirements for class certification of this action under Illinois law. Plaintiffs will now have the opportunity to try and prove the merits of their claims, which is an entirely different matter from establishing the requirements for class certification. The Court notes that class certification will allow all State Farm policyholders to seek redress for their claims and will also provide State Farm with finality as to the claims. State Farm has, for years, had class actions filed against it concerning the matters involved in this litigation and has been forced to defend itself in numerous jurisdictions. Since this case has been filed, the parties have made the Court aware of several cases which have recently been filed, including the Dorries action in Champaign County, Illinois (No. 97­L­ 88), which has now been terminated by Judge Green's November 10, 1997 order in "Krusinski". The Court has learned that the attorneys prosecuting the Dorries case in Illinois had also filed an identical class action case in Alabama. Such a multiplicity of suits is an inefficient use of judicial resources and places State Farm in the unenviable position of trying to defend itself on multiple fronts.

The Court believes that Illinois is the one State where a national class can be maintained and where all issues between State Farm and State Farm's policyholders concerning the use of non­OEM parts can finally be resolved. The Court is unaware of any other class action cases pending in Illinois concerning the issues involved in this litigation and is unaware of any other class action case in any other State which has certified a national class after a full evidentiary hearing on class certification.

The following described Plaintiff Class is hereby ordered certified for purposes of litigation and trial:

All persons in the United States, except those residing in Arkansas and Tennessee, who (1) were insured by a vehicle casualty insurance policy issued by Defendant State Farm and (2) made a claim for vehicle repairs pursuant to their policy and had non-factory-authorized and/or non-OEM (Original Equipment Manufacturer) "crash parts"² installed on their vehicles or else received monetary compensation determined in relation to the cost of such parts. Excluded from the class are employees of Defendant State Farm, its officers, its directors, its subsidiaries, or its affiliates.

In addition, the following persons are excluded from the class: (1) persons who resided or garaged their vehicles in Illinois and whose Illinois insurance policies were issued/executed prior to April 16, 1994, and (2) persons who resided in California and whose policies were issued/executed prior to September 25, 1996.

ENTERED: December 5, 1997, JOHN SPERONI, ASSOCIATE CIRCUIT JUDGE

[February 11, 1998]³

¹Throughout the hearing there was much discussion as to what parts may or may not be "crash parts." Throughout this order the Court has used the term "non-OEM parts" without specifying "crash parts" so as to mirror the Class definition.

²"Crash parts" are vehicle components typically repaired or replaced as a result of crash damage rather than as a result of normal vehicle usage. The non-factory-authorized and/or non-OEM crash parts involved in this Plaintiff Class are of the following types: 1) fenders, 2) hoods, 3) doors, 4) deck lids, 5) luggage lid panels, 6) quarter panels, 7) rear outer panels, 8) front end panels, 9) header panels, 10) filler panels, 11) door shells, 12) pickup truck beds, box sides, and tail gates, 13) radiator/grill support panels, 14) grilles, 15) head lamp mounting panels/brackets/housings/lenses/doors, 16) tail lamp mounting panels/brackets/housings/lenses, 17) outer body moldings, 18) door body side molding, 19) front wheel opening moldings, 20) side moldings, 21) front and rear fascias, 22) outer panel mounting brackets, supports and surrounds, 23) bumpers (excluding chrome bumpers), 24) bumper covers/face bars, and 25) bumper brackets/supports.

³[The certification order was changed to reflect the above included class and crash parts definition by Court order issued February 11, 1998.]

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