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California Supreme Court Poised to Provide Guidance on Ascertainability in Class Actions

On May 8, 2019, the California Supreme Court will hear oral argument regarding an important issue involving class certification in California state courts: how to apply the requirement of ascertainability in the class certification analysis.

Unlike in federal courts—where the issue of ascertainability is unsettled— it is well-established in California that a plaintiff seeking class certification must prove that the proposed class is ascertainable. California appellate courts, however, differ on what is sufficient to meet ascertainability at the class certification stage. In Noel v. Thrifty Payless, Inc., the California Supreme Court appears poised to answer whether ascertainability requires a plaintiff to demonstrate at the class certification stage that records actually exist sufficient to identify class members and to provide them notice, or if ascertainability is satisfied simply by defining the class in terms of objective and common characteristics sufficient to allow members of the class to identify themselves as having a right to recover based on the definition, leaving the ultimate identification of class members for a time after certification.

In Noel, plaintiffs alleged defendants violated California's Unfair Competition Law, False Advertising Law, and Consumers Legal Remedies Act by falsely advertising an inflatable pool as being larger than it was. They sought to certify a class of "all persons who purchased the Ready Set Pool at a Rite Aid store in California within the four years preceding the date of the filing of this action." The Court of Appeal affirmed the trial court's denial of class certification, finding that plaintiffs failed to demonstrate ascertainability because they failed to offer evidence or establish a "realistic way" to clearly identify and notify purchasers of the pools.

The Noel court recognized that its decision conflicted with Aguirre v. Amscan Holdings, Inc., in which a different Court of Appeal held that plaintiff need not demonstrate at the class certification stage a "means of identifying class members" sufficient to provide them with personal notice. Instead, according to Aguirre, it is sufficient for a plaintiff to "define the class in terms of objective characteristics and common transactional facts making the ultimate identification of class members possible when that identification becomes necessary." In distinguishing AguirreNoel noted that Aguirre's approach—to dispense entirely with the requirement of identifying class members at the certification stage—risks undermining the due process protections afforded to the class by providing personal notice.

Given the split among the appellate courts, it is not surprising that the California Supreme Court granted review in Noel. The specific issue on review is: "Must a plaintiff seeking class certification under Code of Civil Procedure section 382 or the Consumer Legal Remedies Act demonstrate that records exist permitting the identification of class members?" Therefore, it seems likely that the California Supreme Court will shed light on what state-court plaintiffs must prove and whether defendants can raise the ascertainability hurdle at the class certification stage.

In addition to providing much-needed guidance on an important issue of California class action jurisprudence, the California Supreme Court's decision could have a residual effect on a plaintiff's decision to file in federal versus state court and a defendant's decision whether to remove to federal court. To date, the U.S. Supreme Court has yet to address ascertainability, resulting in a circuit split. For California litigants, it is important to know that the Ninth Circuit has joined the Second, Fifth, Sixth, Seventh, and Eighth Circuits in finding that there is no separate class certification requirement in federal court that a plaintiff demonstrate that a class can be ascertained via an administratively feasible method or procedure. Depending on the outcome in Noel, a California plaintiff may look to avoid the ascertainability requirement at the class certification stage by filing in federal court. On the other hand, if the Court of Appeal decision in Noel is affirmed, a defendant may elect to stay in California state court to take advantage of an additional defense to class certification unavailable in the Ninth Circuit, at least for now.

We are closely monitoring the case, and we will provide updates after oral argument and after a decision.

Copyright © by Ballard Spahr LLPNational Law Review, Volume IX, Number 112


About this Author

Scott Pearson, Ballard Spahr Law Firm, Los Angeles, Business Litigation Attorney

Scott Pearson focuses his practice on the defense of regulatory enforcement actions and class actions, other complex business litigation, and regulatory compliance counseling. Martindale-Hubbell rates Mr. Pearson "at the highest level of professional excellence." He has been called "a true expert in complex litigation and consumer class actions" and "a no-nonsense bulldog lawyer who is highly respected by his peers and the judiciary."

Prominent companies regularly entrust Mr. Pearson with matters involving bet-the-company exposure or extreme...

Marcos Sasso, Ballard Spahr Law Firm, Los Angeles, Finance and Litigatio Law Attorney
Of Counsel

Marcos Sasso focuses on complex commercial litigation, with an emphasis on the representation of financial services companies. Marcos advises large national banks, credit card issuers, and other lenders in class actions, regulatory enforcement proceedings, and other complex litigation and arbitration matters in California and throughout the country. He also counsels clients on regulatory compliance matters. Marcos has significant experience with the range of consumer financial services laws, including, the Telephone Consumer Protection Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, and state laws such as California's Unfair Competition Law and Consumers Legal Remedies Act.

Marcos handles matters involving preemption, identity theft, credit reporting, and fair debt collection, as well as auto financing, health care financing, commercial contracts, and retail banking disputes. He has served as lead trial counsel for financial services companies in defeating class and individual claims, and has successfully argued for the enforceability of consumer arbitration agreements in trial and appellate courts. He has designed and executed litigation strategy, led teams of attorneys, and negotiated favorable settlements for his clients.

Marcos has extensive litigation experience before the California trial courts and Courts of Appeal, as well as the Ninth Circuit Court of Appeals and California district courts. He also has defended clients in appeals before the California and Idaho Supreme Courts and the Fourth and Eleventh Circuit Courts of Appeal.

Kay Fitz-Patrick, Ballard Spahr Law Firm, Los Angeles, Financial and Litigation Law Attorney

Kay Fitz-Patrick's practice focuses on consumer financial services litigation. Kay has experience with a range of consumer finance-related matters, including complex consumer class actions, investigations, and enforcement actions related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, Real Estate Settlement Procedures Act, Truth in Lending Act, False Claims Act, Financial Institutions Reform, Recovery, and Enforcement Act, Fair Credit Reporting Act, Telephone Consumer Protection Act, Fair Debt Collection Practices Act and state equivalents, and state Unfair, Deceptive, or...