## Facts

- Southwestern Bell Mobile Systems, Inc., doing business as Cellular One, used a standard form cellular-service contract in Massachusetts and New Hampshire from about August 1994 to February 1996.
- The contract defined “chargeable time” for calls “originated” by a subscriber’s mobile unit as beginning at call initiation and ending at confirmed disconnect.
- Customers disputed whether “originated” excluded incoming calls; the named plaintiff claimed the contract barred billing for incoming calls.
- Cellular One billed customers for incoming calls, and many customers signed the same contract and were charged in the same manner.
- Putative class members had different rate plans and usage patterns, but their agreements contained an integration clause requiring written, signed changes.
- The plaintiff asserted breach of contract and violations of Massachusetts General Laws chapter 93A based on allegedly improper billing for incoming calls.

## Issues

1. Whether the district court abused its discretion under Rule 23(b)(3) by decertifying the contract and chapter 93A classes on the ground that individual issues predominated.
2. Whether individualized damages calculations and defenses (including waiver/notice) defeated predominance where the challenged practice arose from a uniform form contract and standardized billing.
3. Whether the district court erred by treating quantum meruit concepts as a basis to negate classwide liability at the certification stage.
4. Whether denial of substitution of a new class representative should stand after reversal of decertification.

## Decision

- The First Circuit reversed the district court’s decertification of the breach-of-contract and chapter 93A classes.
- The court held the district court abused its discretion by relying on legal and factual errors in finding individual issues predominated.
- The court remanded for further proceedings, including reconsideration of the ruling denying substitution of a proposed new class representative.

## Legal Principles

- Predominance under Rule 23(b)(3) is satisfied when common questions are central to liability, even if some individualized questions remain.
- A uniform standard-form contract and uniform charging practice can create predominating common issues, including contract interpretation and defenses tied to standardized disclosures and billing.
- Variation in damages typically does not defeat class certification when liability can be shown with common proof and damages can be determined mechanically from the defendant’s records.
- Courts should not use merits-like theories (such as quantum meruit) at the certification stage to effectively defeat contractual and statutory claims that turn on common proof.

## Conclusion

Because the alleged overcharging stemmed from a single form contract and standardized billing for incoming calls, the key liability questions were common to the class, and individualized damages issues did not outweigh those common issues; the decertification order was reversed and the case was remanded to reconsider class representation.


Smilow v. Sw. Bell Mobile Sys., Inc., 323 F.3d 32 (1st Cir. 2003)