Midland National Life Insurance Co.

United States Court of Appeals for the Ninth Circuit · 2010 · Labor Law

594 F.3d 1087 (2010)

Updated August 1, 2026

Labor Lawelection propaganda standardRule 23(b)(3)class certificationpredominancesuperiorityHawaii Deceptive Practices Actreasonable consumer

Facts

Midland marketed annuities to Hawaii senior citizens through independent brokers between 2001 and 2005. Plaintiffs, Hawaii seniors who purchased the annuities, alleged that Midland's own brochures and disclosure materials deceptively suggested the annuities were appropriate for seniors and failed to disclose material information about risks, detriments, and unsuitability. Midland required brokers to present company disclosure material, obtain signatures on forms, and certify that they made no statements materially inconsistent with Midland's materials. Plaintiffs expressly based their claims on omissions and misstatements in Midland's standardized written materials, not on varying oral statements by individual brokers.

Issue

Does Hawaii's Deceptive Practices Act require each plaintiff to prove individualized, subjective reliance on the allegedly deceptive practice, such that common issues do not predominate for Rule 23(b)(3) class certification? If not, did the district court err in denying certification on predominance and superiority grounds?

Rule

Under Hawaii's consumer protection law, a deceptive act or practice is a representation, omission, or practice that is likely to mislead consumers acting reasonably under the circumstances and is material, meaning likely to affect a consumer's choice. This is an objective reasonable-consumer inquiry; actual or subjective reliance need not be shown, and individualized damages calculations alone do not defeat class certification.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

A Honolulu retirement-products company distributed the same printed flyer to 4,000 Hawaii residents describing a deferred-income contract as offering "security without meaningful downside," while omitting a lengthy surrender penalty. Buyers filed a Hawaii deceptive-practices class action limited to the contents of the company's standardized flyer and disclosure packet.

The company opposes certification, arguing that each class member must prove he or she personally relied on the omission before common issues can predominate. How should the court rule?

Explanation. Under the majority opinion, Hawaii deceptive-practices liability turns on whether a representation, omission, or practice is likely to mislead consumers acting reasonably under the circumstances and is material. That is an objective inquiry, so actual or subjective reliance need not be shown. When plaintiffs confine their theory to standardized written materials, individualized reliance issues do not defeat predominance.