Seyfarth Synopsis: In Toomey v. Arizona, No. 19-CV-0035, 2020 WL 2465707 (D. Ariz. May 12, 2020), a Magistrate Judge for the U.S. District Court for the District of Arizona recommended the certification of class claims brought under Title VII and the Equal Protection Clause regarding health care coverage of gender transition-related surgical care. The plaintiff's support for the numerosity requirement for the certification of the claims was based primarily on approximates of the class size supported by demographic studies and not based on any direct evidence of other putative class members. The case is a must-read for employers and provides insight into the certification standards applied by courts that are leading to the growing trend of certification of class claims.
Case Background
In Toomey, the plaintiff was an associate professor at the University of Arizona and received health insurance benefits under a self-funded health plan provided by the State of Arizona. The health plan provided coverage for medically-necessary care but had exclusions for gender reassignment surgery. The plaintiff was transgendered person, and his treating physicians recommended that he receive a hysterectomy as a medically-necessary treatment for his gender dysphoria. The plaintiff was denied coverage for the surgery under the health plan.
After being denied coverage, the plaintiff filed a class action against the State of Arizona and the University of Arizona alleging sex discrimination claims under Title VII and the Equal Protection Clause of the Fourteenth Amendment. The plaintiff then filed a motion to certify classes of University of Arizona employees and other individuals who are or will be enrolled in the Arizona health care plan and who have or will have medical claims for transition-related surgical care.
The Court's Decision
In a Report and Recommendation issued by the Magistrate Judge, the Court assessed the Rule 23(a) numerosity, commonality, typicality, and adequacy requirements relative to the plaintiff's proposed classes. The Court chiefly focused on the numerosity element, as the State of Arizona challenged whether the plaintiff could satisfy such requirement. To support that the putative classes could meet the numerosity requirement, the plaintiff relied primarily on demographic studies. The plaintiff asserted that "[a]s of 2017, the Board of Regents employed 35,614 individuals at Arizona's public universities" and that "[a]s of 2018, approximately 137,700 individuals receive healthcare through the State's self-funded plan." Toomey, 2020 WL 2465707 at *2. He then pointed to studies that concluded that approximately 0.62% of Arizonans identify as transgender, that 25% to 35% of transgender individuals have undergone some form of gender reassignment surgery, and that an additional 61% of transgender men and 54% of transgender women have reported wanting some kind of gender reassignment surgery in the future.
Based on the studies cited by the plaintiff, he estimated that approximately 82% of transgender individuals either have had or will have a form of gender reassignment surgery and, therefore, he approximated that 181 of such transgender individuals worked for the University of Arizona and 700 of such transgender individuals were covered by the State's health plan.
The Court found that the plaintiff's efforts at approximating the class size were reasonable, even though the plaintiff did not assess how many of the transgender individuals have had or will have surgery while covered by the State's plan. Though the State challenged the plaintiff's survey evidence, arguing that the surveys did not actually address the incidence of transsexualism in Arizona, that other reports outlined the difficulties of approximating the incidence of transsexualism, and that different studies included lower population estimates than the plaintiff's estimate, the Court dismissed these arguments, finding that the data related to Arizona could be extrapolated from data collected from other states and that studies describing a lower population of transgender individuals were older than the one cited by the plaintiff.
The Court found that the plaintiff's putative classes also satisfied Rule 23(a)'s commonality, typicality, and adequacy requirements before turning to the State's argument that, even if the putative classes satisfied the Rule 23 requirements, the Court should use its discretion to deny the plaintiff's motion anyway. The State argued that the motion should be denied because the relief sought by the plaintiff would achieve the same result as the class action. The Court rejected this argument as well, determining that class actions allow unidentified class members to enforce court orders and that certifying the class prevents the case from becoming moot if there are any changes to the plaintiff's medical or employment circumstances. As a result of these findings, the Magistrate Judge recommended that the plaintiff's motion for certification be granted.
Implications For Employers
The ruling in Toomey is the latest example of a rising national trend of courts granting class certification to plaintiffs. This ruling demonstrates the latitude given to plaintiffs to establish the requirements of Rule 23(a), as the plaintiff here relied only on studies and approximate calculations to satisfy the numerosity requirement and not evidence of specific individuals who might have been included in the putative class. Though the defendant challenged the sufficiency of the studies relied on by the plaintiff and the Court pointed out flaws in the plaintiff's estimates, the Court still found that the plaintiff satisfied the requirements for certification. This decision serves as a reminder that employers should be armed with strong defenses when preparing to challenge motions for certification.
Originally published May 19, 2020
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