## Facts

- Two suspended skywalks at a Kansas City hotel collapsed in July 1981, causing numerous deaths and injuries.
- Victims and survivors filed many individual tort suits seeking compensatory and punitive damages in both Missouri state court and federal court.
- The state and federal actions were consolidated in their respective courts, and liaison committees coordinated discovery and trial preparation across the parallel proceedings.
- A federal plaintiff moved to certify a class, asserting that defendants might lack sufficient resources to satisfy all claims, particularly punitive damages.
- The federal district court certified a mandatory (non–opt-out) class under Rule 23(b)(1)(A) for liability and compensatory and punitive damages, and under Rule 23(b)(1)(B) for liability and the amount of punitive damages.
- The certification order barred any class member, including plaintiffs with pending state-court cases, from individually settling punitive-damages claims.
- Some plaintiffs supported certification for case management and punitive-damages control; objecting plaintiffs argued the order improperly restricted individual control and swept in state-court litigants without meeting Rule 23 standards.

## Issues

1. Whether a mandatory class was properly certified under Rule 23(b)(1)(A) for liability and damages based on the risk of multiple suits and inconsistent outcomes.
2. Whether a mandatory class was properly certified under Rule 23(b)(1)(B) on a limited-fund rationale, particularly as to punitive damages.
3. Whether the district court could bar individual punitive-damages settlements and effectively bind plaintiffs pursuing parallel state-court actions.
4. Whether extraordinary appellate relief was available to review and vacate the certification order.

## Decision

- The court granted extraordinary relief and vacated the district court’s class certification order.
- The district court abused its discretion in certifying mandatory classes under Rule 23(b)(1)(A) and (b)(1)(B) for the claims covered by the order.
- Rule 23(b)(1)(A) was not satisfied because the risk identified was ordinary inconsistency in verdicts or awards, not incompatible standards of conduct imposed on defendants.
- Rule 23(b)(1)(B) was not satisfied because the record did not establish a demonstrable limited fund; concerns about insufficiency of assets were speculative.
- The prohibition on individual punitive-damages settlements was improper on the showing made and unduly interfered with plaintiffs’ ability to control their own claims, including those proceeding in state court.

## Legal Principles

- Rule 23(b)(1)(A) mandatory certification requires a risk of adjudications producing incompatible standards of conduct for the party opposing the class; the mere possibility of inconsistent verdicts or differing damage awards is insufficient in mass tort damages suits.
- Rule 23(b)(1)(B) mandatory certification in a limited-fund setting requires a concrete, adequately supported showing of a finite fund and impairment of other claimants’ ability to protect their interests; generalized fears about defendants’ resources do not suffice.
- Mandatory aggregation of punitive-damages issues requires more than case-management concerns; punitive-damages claims are not justified for (b)(1)(B) treatment absent a properly established limited-fund basis.
- Federal class procedure cannot be used to broadly restrict individual plaintiffs’ settlement authority or to control parallel state-court litigation without satisfying Rule 23’s specific prerequisites.

## Conclusion

The Eighth Circuit set aside a mandatory class framework imposed on a mass-tort disaster because neither the “incompatible standards of conduct” rationale nor a properly proven limited fund supported Rule 23(b)(1) certification, and the order’s settlement restrictions and reach into parallel state cases exceeded what Rule 23 allowed on the record presented.


In re Federal Skywalk Cases, 680 F.2d 1175 (8th Cir. 1982)