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NO. 06-0655
IN THE SUPREME COURT OF TEXAS
STONEBRIDGE LIFE INSURANCE COMPANY (F/K/A J.C. PENNEY LIFE
INSURANCE COMPANY), J.C. PENNEY DIRECT MARKETING SERVICES, INC.,
AND AEGON DIRECT MARKETING SERVICES, INC. (F/K/A AEGON SPECIAL
MARKETS GROUP, INC.)
Petitioners
GAYLE G. PITTS AND MARY VANDERFORD
Respondents
On Appeal from the Court of Appeals
for the Thirteenth Judicial District of Texas at Corpus Christi-Edinburg
Case No. 13-05-00131-CV
REPLY TO RESPONSE TO PETITION FOR REVIEW
DUNN, WEATHERED, COFFEY,
RIVERA, KASPERITIS, &
RODRIGUEZ, P.C.
WINSTEAD SECHREST & MINICK P.C.
(512) 370-2800 Telephone (512) 370-2850 Facsimile ATTORNEYS FOR PETITIONERS
REPLY TO RESPONSE TO PETITION FOR REVIEW
Petitioners Stonebridge Life Insurance Company f/k/a J.C. Penney Life Insurance Company, J.C. Penney Direct Marketing Services, Inc., and AEGON Special Markets Group, Inc. n/k/a AEGON Direct Marketing Services, Inc. (collectively "Stonebridge") file this Reply to Respondents Mary Vanderford and Gayle G. Pitts' (collectively "Pitts") Response to Petition for Review and state as follows: The gist of Pitts' allegations is that 1.5 million class members were confused, misled or mistaken, and that none of them wanted to buy the insurance sold by Stonebridge. As explained in the petition, these allegations present individual issues that Money had and received cases
Pitts cites seven cases as proof of the "numerous" similar class actions in other jurisdictions and implies that these other courts have upheld class certification of money had and received claims.1 Although the cases mention unjust enrichment, none discuss
certification of a money had and received claim. One case is a settlement class in which
the Court of Appeals stated there was a "significant risk that the class would be decertified" if the litigation continued. In Re Warfarin Sodium Antitrust Litigation, 391
F.3d 516, 537 (3rd Cir. 2004) (emphasis added). Further, none of the cases discuss the 1 Three of the seven cases (Terazosin, Cardizem and Singer) are federal district court cases that are not precedent in any jurisdiction. See Midlock v. Apple Vacations West, Inc., 406 F.3d 453, 457-58 (7th Cir. 2005) ("But as we have noted repeatedly, a district court decision does not have stare decisis effect; it is not a precedent."). "any facts" rule applicable to a money had and received claim. None of the cases discuss a trial plan or compliance with a rule of procedure similar to Rule 42(c)(1)(D). Arguing that the seven cases cited by Pitts support the trial court's certification of this case is far- Furthermore, all of the cases cited by Pitts are factually dissimilar. None involve customer who allegedly did not want to purchase, or know he was purchasing, a product or service. For example, three of the cases (Warfarin, Cardizem and Terazosin) are antitrust prescription drug cases in which the class members were allegedly overcharged for drugs they wanted. Singer is similar to the prescription drug cases in that the class members were allegedly charged twice for equipment they wanted. Another case (Bice) concerns the underpayment of oil royalties and is directly contradicted by the Texas Supreme Court's recent decertification of a similar class action involving gas royalties. See Union Pacific Resources Group, Inc. v. Hankins, 111 S.W.3d 69, 75 (Tex. 2003) (finding that the case did not satisfy even the low threshold for commonality). The courts in the remaining two cases from Indiana and Ohio (Conagra and Baughman) apply the "certify now, worry later" approach that the Texas Supreme Court has expressly rejected. Pitts tries to distinguish the Alabama cases that reject class certification by quoting Judge Johnstone's dissent in Prickard. No court has accepted the dicta in Judge Johnstone's dissent as a correct interpretation of the law. Instead, the Alabama Supreme Court has decertified every money had and received class action that it has considered. In fact, it decertified another money had and received case just three months ago. See State Farm Fire & Cas. Co. v. Evans, ___ So.2d ____, 2006 WL 1667657 (Ala. June 16, Predominance and superiority
Pitts' "Response" does not include any substantive discussion of the predominance or superiority issues raised in the petition. Pitts does not address: (a) the individual issues; (b) the defenses; or (c) the individual evidence. Nor does Pitts dispute the "any facts" rule quoted in Stone, or deny that, at trial, Stonebridge is entitled to introduce testimony and documents from each class member to show that he or she wanted the insurance, understood he or she was buying it, intended to buy it, and was not misled or confused. Instead of disputing or addressing these substantive issues, Pitts provides a random, general discussion of predominance and tries to justify the use of a First Circuit opinion as authority for the Corpus Christi Court of Appeals' opinion. Trial Plan and Rule 42(c)(1)(D)
Like her analysis of predominance and superiority, Pitts ignores the deficiencies in the trial plan. For example, Pitts does not explain how the evidence the Court of Appeals described as "relevant" (enrollment recordings, call records, etc. relating to 1.5 million class members) will be presented to the jury in a manageable, time-efficient manner. Pitts also fails to address Stonebridge's complaints regarding the "Discovery" or "Class Claims and Defenses" sections of the trial plan. Pitts' silence on these crucial issues is Pitts contends that the certification order complies with Rule 42(c)(1)(D). If this were correct, Pitts could have easily quoted or cited the applicable portions of the order. She did not do so because the order fails to comply with Rule 42(c)(1)(D). A prime example is subsection (viii), which requires the certification order to state: "how the claims and any issues affecting only individual members, raised by the claims or defenses asserted in the pleadings, will be tried in a manageable, time efficient manner." Another is subsection (i), which requires the order to state the elements of each defense asserted in the pleadings. The order does not satisfy either of these requirements. Stonebridge requests that this Court grant its petition for review, reverse the class certification order entered by the trial court, and grant Stonebridge such other and further relief, at law and in equity, to which it may show itself justly entitled. Craig Enoch - State Bar No. 00000026 James David Brown - State Bar No. 03136600 Joel W. Reese - State Bar No. 00788258 WINSTEAD SECHREST & MINICK P.C. 1201 Elm Street 5400 Renaissance Tower Dallas, Texas 75270-2199 214.745.5400 214.745.5390 (facsimile) Frank Weathered - State Bar No. 20998600 DUNN, WEATHERED, COFFEY, RIVERA & 611 South Upper Broadway Corpus Christi, Texas 78401 361.883.1594 361.883.1599 (facsimile) ATTORNEYS FOR PETITIONERS
CERTIFICATE OF SERVICE
The undersigned hereby certifies that a true and correct copy of the foregoing was forwarded, via facsimile transmission, on this 11th day of September, 2006, to: Tamera L. Venzke John P. Venzke THE VENZKE LAW FIRM, L.L.P. P.O. Box 667485 Houston, TX 77266 Via Fax: 713.559.0333 David H. Berg BERG & ANDROPHY 3704 Travis Houston, TX 77002-9550 Via Fax: 713.529.6123 Stephen Gardner LAW OFFICES OF STEPHEN GARDNER 6060 N. Central Expwy., Suite 560 Dallas, TX 75206 Via Fax: 214.871.8957 J. A. “Tony” Canales CANALES & SIMONSON P.O. Box 5624 Corpus Christi, TX 78465-5624 Via Fax: 361.884.7023

Source: http://supreme.courts.state.tx.us/ebriefs/06/06065502.pdf