The Ascertainability Requirement For Class Certification: Origins And Applications

Tuesday, June 19, 2012 - 14:55

Class certification is a watershed moment in high-stakes class action litigation.  For defendants, class certification can represent the difference between being forced to proceed with a “bet the company” trial or to negotiate a settlement with little leverage, on the one hand, and manageable individual trials or the abandonment of the litigation by class counsel, on the other hand.  Whether the court should certify a class turns on whether the movant demonstrated with the preponderance of the evidence that the requirements of Rule 23 of the Federal Rules of Civil Procedure have been satisfied.[1]  In particular, the movant must establish the requirements of Rule 23(a) – numerosity, common questions of law and fact, typicality, and adequacy of the class representative – and that the putative class qualifies as one of the three types of classes in Rule 23(b).[2]  Beyond these express requirements of Rule 23, however, defendants can also successfully challenge class certification motions based on the failure of a lesser known, implicit requirement: ascertainability.[3]  This article explains the ascertainability doctrine and its justifications, and discusses how it can be leveraged by defendants to defeat class certification motions.

The Ascertainability Requirement And Its Origins

Under the ascertainability doctrine, “the class definition must be sufficiently definite so that it is administratively feasible for the court to determine whether a particular person is a member of the proposed class,” and “the identity of the class members must be ascertainable by reference to objective criteria.”[4]  Thus, a class is generally not ascertainable if membership in the class is based on subjective criteria, such as states of mind, or if the court would have to “make a determination about the merits of each claim in deciding whether a particular individual is a class member.”[5]  Furthermore, as part of the requirement that a class definition be administratively feasible, courts have declined to certify classes where ascertaining class membership would require an “arduous individual inquiry,” rather than mere “ministerial review” of relevant records or other evidence.[6]

Courts have based this requirement on a number of justifications, including due process concerns for both absent class members and defendants, as well as the underlying administrative goals of Rule 23 itself.

One due process justification for the ascertainability requirement is the need for clarity as to who is bound by the res judicata effects of an adverse judgment.  If a class is certified despite ascertainability issues and defendants prevail at trial, defendants may have to litigate the scope of the preclusive effect of a class judgment in their favor and, at worst, could be subjected to identical suits by absent class members that should have been bound by the adverse judgment.[7]  This, of course, would be contrary to the very purpose of Rule 23, which is to ensure that the claims of similarly situated class members are fully and finally adjudicated without the need for multiple proceedings.  As Judge Stevens explained in Jimenez v. Weinberger, the modern Rule 23 was “designed, in part, specifically . . . to assure that members of the class would be identified before trial on the merits and would be bound by all subsequent orders and judgments.”[8]  The ascertainability requirement ensures that this fundamental policy of Rule 23 is implemented effectively.

Another due process justification for the ascertainability doctrine is protecting the rights of putative class members to receive notice of the action, and, if they so desire, to opt out of the class and thereby avoid the preclusive effects of a judgment.  As the District Court for the Eastern District of Louisiana recently explained, “the membership of the class must be ascertainable because individual class members must receive the best notice practicable and have an opportunity to opt out.”[9]  Because absent class members will waive their right to pursue their individual claims, and will be bound by the judgment of any (b)(3) class action from which they do not opt out, courts must ensure that the class is sufficiently ascertainable so that unnamed class members can receive fair notice of the action and decide whether they wish to cast their lot with the class.[10]

The relationship between the ascertainability requirement and Rule 23’s requirement that notice be provided to absent class members was emphasized last year by the District Court for the Eastern District of Kentucky in Schilling v. Kenton County, Kentucky.[11]  In Kenton, a putative class action brought against a county and some of its corrections employees by inmates of the county’s local detention center, the named plaintiffs brought several federal and state law claims on behalf of a class of “individuals who, while incarcerated at [the detention center] . . . have been subjected to intentional physical and mental abuse by Defendants in violation of the Eighth Amendment prohibitions on cruel and unusual punishments, and the Fourteenth Amendment’s guarantee of due process and liberty.”[12]  The court, however, granted defendants’ motion to dismiss the class allegations in the complaint pursuant to Federal Civil Rule 12(b)(6) (i.e., on the pleadings, before discovery) because, among other reasons, the class definition was impermissibly indefinite in that it would require the court to decide the merits of each putative class member’s claim in order to establish membership in the class.  Besides being “palpably unfair to the defendant” – who could not know the identity of the class members until liability was established – the court observed that such a class definition was “unmanageable for obvious reasons[,] not the least which includes Defendants’ inability to provide class notice pursuant to Rule 23(c).”[13]

Yet another justification for the ascertainability requirement has nothing to do with due process concerns, but rather with Rule 23(b)(3)’s directive that class actions only be maintained if they are “superior to other available methods for fairly and efficiently adjudicating the controversy.”[14]  One of the considerations underlying the “superiority” inquiry is “the likely difficulties in managing a class action.”[15]  A difficult-to-ascertain class can pose significant manageability concerns.  The District Court for the Southern District of Illinois made precisely this point in its recent decision in Johnson v. Allstate Ins. Co.[16]  In Johnson, plaintiffs sought certification of a nationwide class and various subclasses under both Rule 23(b)(2) and Rule 23(b)(3) of certain insurance policy holders whose premiums were allegedly calculated at higher rates due to the use of a faulty insurance scoring algorithm.[17]  Defendant, however, argued that the putative class and subclasses were not ascertainable because plaintiffs had failed to put forward any workable method for identifying absent class members on the basis of available documentation, including defendant’s own business records.  The court agreed with defendant, declining to certify a (b)(3) class because “ascertaining the members of either the nationwide class or the subclasses would be time consuming[, ] a 23(b)(3) class . . . is not necessarily better than individual adjudication, and [ ] Plaintiffs failed to demonstrate that their class definition would be manageable.”[18]

The Ascertainability Doctrine:  Trends And Applications

Given the many strong justifications underlying the ascertainability doctrine, courts are invoking it with increasing frequency as a basis for denying class certification motions. Several trends can be discerned from the cases.  In particular, courts are reluctant to grant class certification motions where: (1) the class definition is itself overbroad, including putative class members who have no standing to sue the defendant; (2) ascertaining the class members would not be administratively feasible, especially where there is inadequate or insufficient documentation that could be used to identify them; or (3) the class definition is phrased in such a way that absent class members could collect on a judgment adverse to defendants, but would not correspondingly be bound by a judgment in defendants’ favor (a so-called “fail safe” class).  Each of these scenarios is discussed in greater detail below.

Overbroad Classes

A class is insufficiently ascertainable if it “is overbroad and could include a substantial number of people who have no claim under the theory advanced by the named plaintiff.”[19]  Among other things, such overbroad classes raise constitutional concerns under Article III since “[n]o class may be certified that contains members lacking Article III standing . . . The class must therefore be defined in such a way that anyone within it would have standing.”[20]  There may thus be an argument against class certification if the class definition encompasses individuals who have no claim against the defendants.

A good example of this is Sanders v. Apple, Inc.  In that case, plaintiffs brought a class action against a computer manufacturer on behalf of a class consisting of “all persons within the United States who own a 20-inch Aluminum iMac.”[21]  Specifically, plaintiffs alleged that the defendant computer manufacturer deceived and caused damages to them and the other members of the putative class by issuing advertisements that gave the false and misleading impression that the 20-inch Aluminum iMac was able to display as many colors as the 24-inch Aluminum iMac, when in fact the 20-inch Aluminum iMac displayed more than 16 million fewer colors than its 24-inch counterpart.  Plaintiffs further claimed that they and the putative class members relied on these advertisements when they purchased their 20-inch Aluminum iMacs.[22]  The court, however, held that plaintiffs’ proposed class was impermissibly overbroad because it necessarily included individuals who had no standing to sue the defendant:

Currently, the class definition includes all persons within the United States who own a 20-inch Aluminum iMac.  This definition necessarily includes individuals who did not purchase their 20-inch Aluminum iMac, individuals who either did not see or were not deceived by advertisements, and individuals who suffered no damages.  Such individuals would lack standing to bring these claims.[23]

A court denied a class certification motion in Colapinto v. Esquire Deposition Services, LLC[24] on similar grounds.  Colapinto was a putative class action brought against a legal transcription service on behalf of “[a]ll residents of California, including persons and business, who paid for Defendant’s transcriptions services at a per page rate during the Class Period and for whom Defendants included the pages from the computer-generated word index in the total page count.”[25]  The court, however, refused to certify such a class on the grounds that it included individuals who were not harmed by defendant’s charging of the full per-page rate for a transcript’s computer-generated index, and therefore would have no standing to sue.  The court noted that plaintiffs’ class definition included attorneys who “paid” for such transcripts, but were ultimately reimbursed by their clients, and therefore incurred no loss as a result of defendant’s alleged overcharging.[26]

Another instructive case is Vigus v. Southern Illinois Riverboat/Casino Cruises, Inc., in which the District Court for the Southern District of Illinois likewise refused to certify the proposed class because it included many individuals who suffered no harm as a result of defendant’s alleged violations.[27]  The named plaintiff in Vigus sued a casino for violations of the Telephone Consumer Protection Act (“TCPA”) based on his receipt of “eight pre-recorded telephone calls on his residential telephone line conveying an unsolicited advertisement from the Casino.”[28]  On this basis, the named plaintiff moved to certify a class consisting of “every recipient of a prerecorded message from the Casino during the relevant time period.”[29]  The court noted that such a class, however, would not be sufficiently definite because it included “a substantial number of people who voluntarily gave their telephone numbers to the Casino knowing that the Casino would call those numbers to present special commercial offers.”[30]  Because such individuals consented to receiving cold calls from the casino, they could not have been harmed by the casino’s actions.  Accordingly, the inclusion of these individuals in the class rendered it overly broad.

Administratively Infeasible Classes

Courts are also reluctant to certify a class where the class representative fails to demonstrate that the absent class members can be identified with reference to a complete, workable set of documentation, such as governmental or business records.  Thus, even if a court concludes that the class definition uses objective and appropriately inclusive criteria to identify class members, there is an argument that it should still deny a motion for class certification unless the movant shows that sufficient “real world” documentation or data exists so that the class definition can be applied in a ministerial fashion, without the need to engage in individualized, case-by-case review of each putative class member’s circumstances.  Moreover, even if class counsel can identify records that the court or the parties could use to identify the absent, unnamed class members, a court may still deny a class certification motion if those records are either under- or over-inclusive.[31]

Administrative infeasibility due to lack of documentation has been increasingly cited by courts as grounds for denying class certification motions.  For example, in Xavier v. Philip Morris USA Inc., a putative class action tort suit against a tobacco company, plaintiffs proposed a class definition of all individuals who smoked Marlboro cigarettes for “twenty pack-years,” or the equivalent of one pack per day for twenty years.[32]  Even though this definition utilized objective criteria – a putative class member either smoked the equivalent of a pack a day for twenty years or did not – the court held that the class was not ascertainable because unnamed class members could not be identified in a reliable manner.[33]  Specifically, the court noted that the only source of information that could be used to include a particular individual in the class was “each individual’s subjective estimate of his or her long-term smoking habit,” rather than an objective set of data:

Unlike in many cases, there are no defendant records on point to identify class members.  There is no reliable way in which smokers themselves could document their long-term smoking histories.  The question thus would come down to the state of mind of the putative class member, and it would be easy to fade in or out of the class depending on the outcome.[34]

The court also rejected plaintiffs’ suggestion that defendant’s database of smokers who were members of its customer loyalty program could furnish the requisite information to identify all class members, noting that “not all Marlboro smokers may be presumed to have participated in these programs.”[35]  Even defendant’s own records were inadequate for the purpose of identifying absent class members.

Lack of complete documentation was also noted by New York Court in Weiner v. Snapple Beverage Corp.[36]  The Weiner class representatives sued defendant, a beverage company, for advertising that its drinks were “All Natural,” despite their inclusion of high fructose corn syrup.[37]  Plaintiffs then moved to certify a class of “[a]ll persons and entities who, within the State of New York, purchased for personal consumption and not for resale or assignment, a Snapple beverage marketed, advertised and promoted as “All Natural,” but that contained [high fructose corn syrup], from October 1, 2001, to January 1, 2009.”[38]  The court denied plaintiffs’ class certification motion, reasoning that the proposed class was not ascertainable because plaintiffs “failed to show how the potentially millions of putative class members could be ascertained using objective criteria that are administratively feasible.”[39]  Among other things, the court emphasized the total lack of business records that could identify these class members.

In response to this dearth of documentation, plaintiffs recommended that, “after certification, the Court could require that [c]lass members produce a receipt, offer a product label, or even sign a declaration to confirm that the individual had purchased a Snapple beverage within the class period.”  The court, however, found this to be an insufficient solution.  First, the court observed that there was no evidence that the putative class members retained documentation of their Snapple purchases; to make class certification contingent on such documentation would therefore be unrealistic.  Second, allowing putative class members to sign declarations attesting to their purchase of Snapple bottles with the “All Natural” label would only invite speculation, because purchasers “are unlikely to remember every Snapple purchase during the class period, much less whether it was an ‘All Natural’ or diet beverage, whether it was purchased as a single bottle or part of a six-pack or case, whether they used a coupon, or what price they paid.”  The unreliability of purchasers’ memories, coupled with insufficient records, thus warranted a finding that the proposed class was not ascertainable.[40]

“Fail Safe” Classes

Courts also often reject class definitions if they employ criteria that depend on the merits and final outcome of plaintiffs’ legal claims.  Putative classes that make use of such merits-based definitions are often referred to as “fail safe” classes because they “preclude membership [in the class] unless the liability of the defendant is established.”[41]  The major defect with “fail safe” classes, as noted supra, is that they impose no risk on the absent class members in the event of a judgment adverse to the class, since the class definition is structured so that the class will not exist if the defendant is not found liable.[42]  The only party that assumes any litigation risk for a “fail safe” class action is the defendant.

The presence of merits-based criteria in a class definition is usually an easier defect to spot than overbreadth or administrative infeasibility, with the result that courts will often summarily deny class certification if a class definition employs such merits-based language, with little or no need for further explanation or justification.  For example, in Bauer v. Dean Morris, L.L.P., plaintiffs brought two separate class action suits against certain lenders and their counsel, claiming that after plaintiffs and the unnamed class members defaulted on residential loans that the defendant lenders had issued them, the lenders’ law firm instituted collection and/or foreclosure proceedings against the putative class members and overstated to them the amount of court costs, sheriff’s fees, attorney’s fees, and other expenses that they would have to pay in the event that they were found liable.[43]  With some minor variations, both class action complaints defined the proposed plaintiff class as “[a]ll Louisiana residents (or their heirs, successors, or assign) who were charged excessive fees and/or expenses by a member of the Defendant Class by or through [their counsel].”[44]  Defendants then moved to strike plaintiffs’ class allegations pursuant to Rule 23(d)(1)(D)[45] on the grounds that the class was not ascertainable because both proposed class definitions would create an impermissible “fail safe” class.  Louisiana District Court agreed with defendants, explaining that, because class membership could only be established “in each case only after reviewing the merits of each individual’s claim,” the proposed class was not “adequately defined and clearly ascertainable,” and plaintiffs’ claims could therefore not be maintained as a class action.[46]

Likewise, in Kissling v. Ohio Casualty Ins. Co., plaintiff brought a class action on behalf of himself and other similarly situated persons against an insurance company that did not settle claims in full within thirty (30) days from the time that the insured submitted a notice and proof of claim, as required by Kentucky law.[47]  The court, however, accepted defendant’s contention that plaintiff’s proposed class was a defective “fail safe” class, and accordingly granted defendant’s Rule 12(b)(6) motion to dismiss the class allegations.[48]  In reaching its decision, the judge explained that under plaintiff’s proposed class definition, “[i]f the putative class member is in fact a member of the class, then he necessarily prevails on his claim, as class membership is also determinative of liability.  As this Court previously explained, such a fail-safe class is prohibited.”[49]

Some courts have gone a step further and refused to certify any class whose membership would be contingent, even indirectly, on a final adjudication of the case on the merits.  For example, in George v. Kraft Foods Global, Inc., the District Court for the Northern District of Illinois held that the proposed class definition impermissibly relied on the merits of the case where it excluded from the class “other individuals who are or may be liable for the conduct described in this Complaint.”[50]  Defendants had argued – and the court concurred – that this carve-out from the definition of the class would itself require a decision on the merits before any class members could be identified.  Because the proposed exception to the class definition “impermissibly link[ed] the class definition to the merits of the case,” the court declined to include it in the certified class definition, and modified the class definition accordingly.[51]

Conclusion

While not an explicit requirement of Rule 23, ascertainability is now widely recognized as an implicit prerequisite for class certification.  Defense counsel should therefore consider invoking the ascertainability doctrine as grounds for seeking dismissal of facially deficient class allegations in the pleadings, for moving to strike class allegations, or opposing class certification motions, especially where the proposed class definition is imprecise, indefinite, or otherwise not ascertainable.


[1] See, e.g., N.J. Carpenters Health Fund v. Rali Series 2006-QO1 Trust, Nos. 11-1683-cv, 11-1684-cv, 2012 WL 1481519, at *2 (2d Cir. Apr. 30, 2012) (“The party seeking class certification . . . bears the burden of demonstrating that each of Rule 23’s requirements is satisfied; facts requisite for such a demonstration must be shown by a preponderance of the evidence.”) (citation omitted); Rowe v. Bankers Life & Cas. Co., No. 09-cv-491, 2012 WL 1068754, at *5 (N.D. Ill. Mar. 29, 2012) (noting that a party seeking class certification must “affirmatively demonstrate” compliance with Rule 23 “by a preponderance of evidence”) (citations omitted).

[2] Rule 23(b) provides that a class may only be certified if it meets the requirements of Rule 23(a) and one of the following conditions applies:  (1) the prosecution of separate actions would create a risk of either (a) inconsistent or varying adjudications with respect to individual class members, or (b) adjudications with respect to individual class members that would be dispositive of the interests of class members not party to the individual adjudications; (2) final injunctive or declaratory relief is appropriate for the class as a whole because the party opposing the class has acted or refused to act in ways that apply generally to the class; or (3) the court finds that questions of law or fact common to class members predominate over questions affecting individual class members, and that a class action is a superior method for fairly and efficiently adjudicating the controversy.  See Fed. R. Civ. P. 23(b)(1)-(3).

[3] See, e.g., John v. Nat’l Sec. Fire & Cas. Co., 501 F.3d 443, 445 (5th Cir. 2007) (“The existence of an ascertainable class of persons to be represented by the proposed class representative is an implied prerequisite of Federal Rule of Civil Procedure 23.”); Engel v. Scully & Scully, Inc., 279 F.R.D. 117, 127 (S.D.N.Y. 2011) (“Although Rule 23(a) does not expressly require that a class be definite in order to be certified, Second Circuit courts have implied a requirement that a class be identifiable before it may be properly certified.”); Bauer v. Dean Morris, L.L.P., Nos. 08-5013, 08-5014, 2011 WL 3924963, at *3 (E.D. La. Sept. 7, 2011) (“It is elementary that in order to maintain a class action, the class sought to be represented must be adequately defined and clearly ascertainable.”); Schilling v. Kenton Cnty., Kentucky, No. 10-143-DLB, 2011 WL 293759, at *5 (E.D. Ky. Jan. 27, 2011) (“Despite the absence of a specific dictate, Rule 23(a) inherently requires that a class be sufficiently definite so that it is administratively feasible for the court to determine whether a particular individual is a member.”); Weiner v. Snapple Beverage Corp., No. 07 Civ. 8742(DLC), 2010 WL 3119452, at *12 (S.D.N.Y. Aug. 5, 2010) (“Related to, but distinct from, the issue of manageability [under Rule 23(b)(3)], is the ‘implied requirement of ascertainability,’ which turns on the definition of the proposed class.”).

[4] Sadler v. Int’l Paper Co., No. 09-cv-1254, 2011 WL 3502467, at *4 (W.D. La. July 13, 2011) (citations omitted); see also George v. Kraft Foods Global, Inc., 270 F.R.D. 355, 370 (N.D. Ill. 2010) (“An implicit prerequisite to class certification is that a sufficiently definite class must exist.”) (citing Alliance to End Repression v. Rochford, 565 F.2d 975, 977-78 (7th Cir. 1977)).

[5] Wu v. Pearson Educ., Inc., 277 F.R.D. 255, 273 (S.D.N.Y. 2011).

[6] Wooley v. Jackson Hewitt Inc., No. 07 C 2201, 2011 WL 1559330, at *4 (N.D. Ill. Apr. 25, 2011) (citing Ramirez v. Palisades Collection LLC, 250 F.R.D. 366, 370 (N.D. Ill. 2008)); see also Xavier v. Philip Morris USA Inc., 787 F. Supp. 2d 1075, 1089 (N.D. Cal. 2011) (“[C]ourts of appeals have found class certification to be inappropriate where ascertaining class membership would require unmanageable individualized inquiry.”) (citing Romberio v. Unumprovident Corp., 385 Fed. App’x 423, 431-33 (6th Cir. 2009); Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 259 F.3d 154, 187, 191-93 (3d Cir. 2001)).

[7] See, e.g., Xavier, 787 F. Supp. 2d at 1089 (“Ascertainability is needed for properly enforcing the preclusive effect of final judgment.”); Weiner, 2010 WL 3119452, at *12 (“To be ascertainable, the class must be readily identifiable, such that the court can determine who is in the class, and thus, bound by the ruling.”) (quoting Charrons v. Pinnacle Grp. N.Y. LLC, No. 07 Civ. 6316(CM), ___ F.R.D. ____, 2010 WL 1752501, at *6 (S.D.N.Y. Apr. 27, 2010)).

[8] 523 F.2d 689, 698 n.17 (7th Cir. 1975) (Stevens, J.).

[9] Wooley, 2011 WL 1559330, at *4 (quoting Manual for Complex Litigation § 21.222, at 270) (internal quotation marks omitted); see also Fed. R. Civ. P. 23(c)(2)(B) (“For any class certified under Rule 23(b)(3), the court must direct to class members the best notice that is practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort.”); Cerdant, Inc. v. DHL Express (USA), Inc., No. 2:08-cv-186, 2010 WL 3397501, at *5 (S.D. Ohio Aug. 25, 2010) (“Where certification is sought pursuant to Rule 23(b)(3), as is the case here, precise definition of the class is required because Rule 23(b)(3) provides for monetary relief and requires notice to allow class members to opt out of the litigation.”) (citing Finch v. N.Y. State Office of Children & Family Svcs., 252 F.R.D. 192, 198 (S.D.N.Y. 2008)).

[10] See Clavell v. Midland Funding LLC, No. 10–3593, 2011 WL 2462046, at *2 (E.D. Pa. June 21, 2011) (“This requirement [of ascertainability] is necessary because class actions bind all unnamed class members.”) (citing Giordano v. Radio Corp. of America, 183 F.2d 558, 561 (3d Cir. 1950)).

[11] 2011 WL 293759.

[12] Id. at *1.

[13] Id. at *6 (quoting Kamar v. RadioShack Corp., 375 Fed. App’x 734, 735 (9th Cir. 2010)) (internal quotation marks omitted).

[14] See Fed. R. Civ. P. 23(b)(3) (“A class action may be maintained if Rule 23(a) is satisfied and if . . . the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy. . . .”).

[15] Fed. R. Civ. P. 23(b)(3)(D).

[16] No. 07-cv-0781-SCW, 2011 WL 3476611 (S.D. Ill. Aug. 9, 2011).

[17] Id. at *9-10.

[18] Id. at *10.

[19] Vigus v. S. Ill. Riverboat/Casino Cruises, Inc., 274 F.R.D. 229, 235 (S.D. Ill. 2011).

[20] Sanders v. Apple Inc., 672 F. Supp. 2d 978, 991 (N.D. Cal. 2009) (ellipses in original) (quoting Denney v. Deutsche Bank AG, 443 F.3d 253, 264 (2d Cir. 2006)).

[21] Id.

[22] Id. at 983.

[23] Id.; see also Berndt v. Cal. Dep’t of Corrections, No. C 03-3174 PJH, 2012 WL 950625, at *11-12 (N.D. Cal. Mar. 20, 2012) (finding plaintiffs’ proposed Rule 23(b)(3) class definition of “all women employed by any [California Department of Corrections and Rehabilitation] facility [during the class period] at which male inmates are incarcerated and incidents of inmate exhibitionist masturbation have been reported” to be overbroad because it “fail[ed] to distinguish between women who were actually subjected to an [inmate exhibitionist masturbation] incident, and those who were not”) (internal quotation marks omitted).

[24] Nos. CV 09-07584 SJO (PLAx), SACV 10-00297 SJO (PLAx), 2011 WL 913251 (C.D. Cal. Mar. 8, 2011).

[25] Id. at *4.

[26] See id. (noting that if these “[attorney] class members were reimbursed, there would be no harm”).

[27] 274 F.R.D. 229.

[28] Id. at 232.

[29] Id. at 234 (emphasis in original).

[30] Id. at 235.

[31] See Manson v. GMAC Mortg., LLC, No. 08-12166-RGS, 2012 WL 1500203, at *5 n.26 (D. Mass. Apr. 30, 2012) (“While not explicitly mentioned in Rule 23, an implicit prerequisite to class certification is that a ‘class’ exists – in other words, it must be administratively feasible for the court to determine whether a particular individual is a member.”) (citations and internal quotation marks omitted); see also In re OnStar Contract Litig., 278 F.R.D. 352, 373 (E.D. Mich. 2011) (denying plaintiffs’ motions for class certification where defendant’s business records were not “sufficient to determine if any given individual meets all of the requirements of a given proposed class,” and individualized inquiries would therefore be required).

[32] 787 F. Supp. 2d at 1077.

[33] Id. at 1089.

[34] Id. (emphasis in original).

[35] Id. at 1090.  The court similarly rejected a contention by plaintiffs that the cy pres and fluid recovery concepts – which govern the “distribution of unclaimed monies” following a determination that defendant is liable – could address the ascertainability defects of plaintiffs’ proposed class.  Id.  The court explained:  “Applicability of [the cy pres or fluid recovery] doctrine presupposes a scenario in which plaintiffs have emerged victorious at the end of this litigation.  The doctrine therefore does not help plaintiffs overcome the problem of how to enforce the res judicata effect of final judgment against an un successful, unascertainable plaintiff class.”  Id. at 1090-91 (emphasis in original).

[36] 2010 WL 3119452.

[37] Id. at *1.

[38] Id. at *2.

[39] Id. at *13.

[40] Id. (also noting, as grounds for denying class certification, that “the process of verifying class members’ claims would be extremely burdensome for the court or any claims administrator).  For other recent cases in which a class was found to be unascertainable based on a lack of complete documentation, see, e.g., Vigus, 274 F.R.D. at 235 (holding that use of call logs to identify class members by reference to their telephone numbers was inadequate because “even after identifying such numbers, further number-specific inquiry would be necessary to identify reassigned numbers and their owners”); Tech v. United States, 271 F.R.D. 451, 456-57 (M.D. Pa. 2010) (agreeing with defendant’s contention that “neither [defendant], nor any other entity, has records capable of determining membership in the proposed class”); Clavell, 2011 WL 2462046, at *4-5 (holding that class was not ascertainable based on records in defendant’s database, since those records only provided estimated data, and would not “avoid an individualized inquiry into each putative member’s . . . particular circumstances”); Wooley, 2011 WL 1559330, at *5 (“Plaintiffs offer no basis to conclude that there exists [a comprehensive] paper or electronic record in this case [to identify individuals as class members].”); Cerdant, 2010 WL 3397501, at *6 (noting that plaintiff’s reliance on a particular document to identify proposed class members was flawed because the document was over-inclusive).

[41] Schilling, 2011 WL 293759, at *6 (citing Kamar, 375 Fed. App’x at 736).

[42] See id. (noting that “fail safe” classes are “palpably unfair to the defendant, and . . . also unmanageable for obvious reasons; not least of which includes Defendants’ inability to provide class notice pursuant to Rule 23(c)”) (citing Kamar, 375 Fed. App’x at 734) (internal quotation marks omitted).

[43] 2011 WL 3924963, at *1.

[44] Id. at *1-2 (noting that the second class action complaint replaced the word “expenses” with “charges” in its proposed class definition, and further limited the proposed class to “those persons whose bankruptcy filing would or might support removal to federal court and/or jurisdiction for their claim”).

[45] Under Rule 23(d)(1)(D), a court overseeing a putative class action “may issue orders that . . . require that the pleadings be amended to eliminate allegations about representation of absent persons and that the action proceed accordingly.”  Fed. R. Civ. P. 23(d)(1)(D).

[46] Id. (“Given that an inquiry into the merits of each potential class member’s claim would be necessary to determine whether an individual fell within the defined class, the Court concludes that the proposed classes are not ascertainable.”).

[47] No. 5:10-22-JMH, 2010 WL 1978862, at *1 (E.D. Ky. May 14, 2010) (noting that plaintiff sought the remedy prescribed by Section 304.12-235 of the Kentucky Revised Statutes for violations of this sort – namely, payment of 12% interest on the ultimate settlement paid out by the insurance company plus attorney’s fees).

[48] Id. at *3 (“Because Plaintiff’s class allegations are not plausible on their face, in that the proposed class is not properly defined, the Court will grant Defendant’s motion to dismiss Plaintiff’s class allegations.”).

[49] Id. at *2 (footnote omitted).  In particular, the court observed that fail-safe classes contravene Rule 23’s policy against “one-way intervention,” a practice by which “no unnamed plaintiffs could be bound by [an] unfavorable decision[,] yet these plaintiffs would have the full benefit of any decision in their favor.”  Id. (quoting Eversole v. EMC Mortg. Corp., No. 05-124, 2007 WL 1558512, at *4 (E.D. Ky. May 29, 2007)).

[50] 270 F.R.D. 355, 370 (N.D. Ill. 2010) (emphasis added).

[51] Id.

 

Yvette Ostolaza is a Partner and Co-Head of Weil, Gotshal & Manges LLP’s Complex Commercial Litigation group. Her practice focuses on consumer and securities class action cases, commercial disputes and internal investigations. David R. Singh is a Senior Associate in the firm’s Complex Commercial Litigation group. His practice focuses on consumer fraud class actions, alleged violations of state consumer protection acts, business torts, commercial disputes and bankruptcy litigation. Joshua I. Schlenger is an Associate in the firm’s Complex Commercial Litigation group. His practice focuses on securities fraud and bankruptcy litigation, as well as commercial disputes.

This article provides general information and should not be used or taken as legal advice for specific situations which depend on the evaluation of precise factual circumstances.  None of the views expressed in this article should be construed or interpreted as legal positions or opinions of the law firm of Weil, Gotshal & Manges LLP.

Please email the authors at yvette.ostolaza@weil.com, david.singh@weil.com or joshua.schlenger@weil.com with questions about this article.