Trial News

The California Supreme Court has rejected a higher evidentiary burden for class action plaintiffs to show how members of a putative class will be identified, known as “ascertainability,” before certifying a class. The court held that a plaintiff does not need to provide exactly how each absent class member would be identified and notified of the litigation to satisfy due process concerns. Rather, the class representative must show at the certification stage that a reasonable and meaningful method of identifying and notifying a substantial portion of class members exists. Plaintiff attorneys have called the decision favorable to consumers and employees and a major blow against corporations. (Noel v. Thrifty Payless, Inc., 2019 WL 3403895 (Cal. July 29, 2019).)

Plaintiff James Noel filed a putative class action for unfair competition and false advertising claims, as well as violations of California’s Consumer Legal Remedies Act over the packaging of an inflatable backyard pool he purchased at a Rite Aid convenience store, owned by defendant Thrifty Payless, Inc. Noel alleged that the photograph on the packaging—which depicts several adults easily able to fit in the inflatable pool—incorrectly leads customers to believe that the pool is much larger than it is. The plaintiff moved to certify a class defined as “[a]ll persons who purchased the Ready Set Pool at a Rite Aid store located in California within the four years preceding the date of the filing of this action.” Discovery materials indicated that more than 20,000 pools had been purchased during that time, amounting to nearly $950 million in sales for the defendant.

The defendant opposed class certification on the basis that the plaintiff had not met the ascertainability prerequisite because he had not demonstrated how class members would be identified to receive notice of the litigation and that there was no evidence in the record as to what specific method could be used to track down absent class members. The plaintiff countered that this was a higher bar than the procedural rules required, noting generally that the defendant should be able to locate pool purchasers through credit card records, its loyalty program, or email communications that it already sends to customers regularly.

The trial court denied the class certification motion, finding that even though it may be reasonable to “infer that the class . . . could be ascertained based on common business practices and record keeping,” the plaintiff had not offered evidence as to what those records would be, how they would be accessed, how burdensome it would be on the defendant, or what the available records would show. The plaintiff appealed, but the appellate court affirmed. It explained that “the underlying problem with the class certification motion . . . [is the] premature filing of the motion without first conducting sufficient discovery to meet its burden of demonstrating there are means of identifying members of the putative class so that they might be notified.”

The California Supreme Court granted review of the decision to clarify the ascertainability requirement. The court noted that while ascertainability is a long-established requirement for class certification, its prior case law had not squarely set forth exactly what must be shown to satisfy that requirement. It held that a class is ascertainable when “in terms of objective characteristics and common transactional facts . . . the ultimate identification of class members [is] possible when that identification becomes necessary” and that the lower courts erred by adding an evidentiary burden for the plaintiff to satisfy regarding notice to absent class members before certifying the class.

If the class definition provides “objective terms that make the eventual identification of class members possible,” then it satisfies ascertainability and the due process considerations tied to this requirement. The court disagreed that certifying a class depends on the ability to send all absent class members individual notice of the litigation. Rather, the class representative “need only provide meaningful notice in a form that ‘should have a reasonable chance of reaching a substantial percentage of the class members.’”

Here, the court explained that because of the nature of the putative class members and the relatively lower-value product at issue, “the true choice in this case is not between a single class action . . . and multiple individual actions pressing similar claims; it is between a class action and no lawsuits being brought at all.” Analyzing the ascertainability of a class for due process requires more than a bright-line rule for notice; it involves a “careful weighing of both the benefits and the burdens” of the putative class action. The lower courts’ construction of the standard would have ignored this consideration of the unique facts and circumstances of each case.

Oakland, Calif., attorney Leslie Brueckner, who argued on behalf of the class, said, “This ruling restores and reaffirms the viability of class actions in California. Rite Aid wanted the court to adopt an ‘ascertainability’ rule that would make it impossible to bring most small-value consumer claims—and also make it more difficult to bring many employment class actions, by creating a perverse incentive for employers to destroy their own records.” She noted the larger significance of the ruling, which reviewed other jurisdictions’ ascertainability standards in its analysis. “Noel v. Thrifty is particularly important because it reaffirms the viability of class actions at a time when they are increasingly under siege. Class actions are the procedural device wrongdoing corporations love to hate. When a company harms a lot of consumers by a single illegal act—say, by selling dog food tainted with euthanasia drugs or by charging outrageous interest rates on payday loans—class actions are often the only way victims can hold the corporation accountable.”