• Class Certification Denied Because Plaintiff Could not Meet Ascertainability Standard or Demonstrate that Class Action was Superior to Individual Claims
  • March 30, 2010
  • Law Firm: Strasburger Price LLP - Dallas Office
  • Grimes v. Rave Motion Pictures Birmingham, LCC, 2010 U.S. Dist. LEXIS 12894 (N.D. Ala. Jan. 29, 2010)

    Facts: Plaintiff alleged that Defendants violated the Fair Credit Reporting Act (“FCRA”), as amended by the Fair and Accurate Credit Transactions Act of 2003 (“FACTA”), by willfully printing more than the last five digits of a consumer's credit card number on a digital receipt. Plaintiff also moved for certification of the above lawsuit as a class action. This case was on appeal to the Eleventh Circuit after the district court held FACTA to be unconstitutionally vague and confiscatory.  The Eleventh Circuit subsequently reversed, finding FACTA to be constitutional on its face.  The Eleventh Circuit then sent the case back to the district court to decide, inter alia, whether class treatment under Federal Rule of Civil Procedure Rule 23 is appropriate. For the reasons that follow, the Court held that class treatment was not appropriate.

    • Class Certification. Although not explicit in Rule 23(a) or (b), courts have universally recognized that the first essential ingredient to class treatment is the ascertainability of the class. Thus, Plaintiff must define the proposed class in a manner that adequately identifies its members. After the implicit requirement of ascertainability is met, Plaintiff must establish the four prerequisites in Rule 23(a), namely: (1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class. If these four prerequisites can be established, the class must also fit within at least one type of class action recognized in Rule 23(b).

    • Class Certification. Plaintiff’s description did not meet the standard of ascertainability.  “Ascertainability" must exist before numerosity and typicality can even be considered.  Although Defendants say that no one has made a claim of actual damages as a result of receiving a non-compliant receipt, theoretically every FACTA non-compliant receipt that may have been issued by Defendants, except the two of which Plaintiff individually complains, could have caused actual damages to the victimized credit cardholders.  If all such are excluded, there may be no class. Requiring the class to be clearly described places courts in a position to determine whether the class meets the prerequisites for class treatment expressly set forth in Rule 23(a) and (b). In this case, the Court found that Plaintiff’s amorphous description of the class made it impossible to determine whether Plaintiff's proposed class warrants class treatment

    • Class Certification. The Court also expressed concern over the fact that the class description nowhere mentions that a non-compliant receipt must have been "willfully" provided to a customer, an essential element for every FACTA claim. The mere mention in the class notice that Defendants deny that it was "willful" does not alert would-be class members that they will bear the burden of proving "willfulness" in order to establish liability.

    Class Certification. In addition to the ascertainability standard, a class action must also fit within one of the three classifications listed in Rule 23(b). Plaintiff alleged that she met the requirements of subsection (3) of section (b): "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.” However, the Court determined that a class action was not superior to other available methods in this instance. Plaintiff was unable to identify any other individuals who had received a receipt from Defendants that exposed more than the last five digits of their credit card. In addition, the FCRA provides for an award of attorney’s fees and costs in addition to statutory damages so there is no financial impediment for a person who receives a non-compliant receipt from finding a lawyer to bring an individual claim. For these reasons, the Court held that individual actions are not only feasible, but they are much more manageable than a class action would be.