The Class Action Chronicle – Midyear Update

This edition focuses on rulings issued between February 16, 2018, and June 15, 2018.

In this issue, we cover three decisions granting motions to strike/dismiss class claims, five decisions denying such motions, 27 decisions denying class certification or reversing grants of class certification, 34 decisions granting or upholding class certification, 11 decisions denying motions to remand or reversing remand orders pursuant to the Class Action Fairness Act (CAFA), and seven decisions granting motions to remand or finding no jurisdiction under CAFA that were issued during the four-month period covered by this edition.

Class Certification Decisions

Decisions Granting/Affirming Motion to Strike or Dismiss Decisions Denying Motions to Strike Decisions Rejecting/Denying Class Certification Decisions Permitting/Granting Class Certification Class Action Fairness Act Decisions

Decisions Denying Motions to Remand/Reversing Remand Orders/Finding CAFA Jurisdiction Decisions Granting Motions to Remand/Finding No CAFA Jurisdiction Other CAFA Decisions Class Certification Decisions

Decisions Granting/Affirming Motion to Strike or Dismiss

Walters v. Vitamin Shoppe Industries, Inc., No. 3:14-cv-1173-PK, 2018 WL 2424132 (D. Or. May 8, 2018), report and recommendation adopted, 2018 WL 2418544 (D. Or. May 29, 2018)

The plaintiff asserted nationwide class claims for unjust enrichment and fraud and claims for violations of Oregon consumer protection law on behalf of a proposed subclass of Oregon purchasers, alleging the defendant misleadingly labeled its supplements in referring to volume per serving rather than the volume per individual pill, capsule or tablet. Judge Anna J. Brown of the U.S. District Court for the District of Oregon adopted the findings and recommendation of Magistrate Judge Paul Papak and granted the defendant's motion to strike the nationwide class allegations. The motion was not premature because determining variations in state law presented legal issues that could be resolved without discovery, and a motion to strike pursuant to Federal Rule of Civil Procedure 12(f) was "procedurally appropriate." The court further concluded that material variations in state law on fraud and unjust enrichment would produce different outcomes, and thus, under Oregon choice of law statutes, the law of the state of purchase would govern each proposed class member's claim. Rule 23(b)(3)'s predominance requirement could not be satisfied as to the unjust enrichment claim due to differences in state laws, such as the applicable statute of limitations, whether unjust enrichment is a standalone claim or a quasi-contract claim, and the accrual date. Material differences in state law such as the level of scienter necessary to show fraud, the plaintiff's burden of proof, statute of limitations and whether reliance may be presumed defeated predominance as to the fraud claim. The court's order striking the class allegations was without prejudice, however, to allow the plaintiff to narrow his class definition to include only residents of those states where the law does not materially differ.

Reedy v. Phillips 66 Co., No. H-17-2914, 2018 WL 1413087 (S.D. Tex. Mar. 20, 2018)

Judge Sim Lake of the U.S. District Court for the Southern District of Texas dismissed nationwide class claims brought on behalf of purchasers of allegedly defective aircraft fuel on the ground that the need to apply the laws of multiple states to the proposed class members' claims made a finding of predominance impossible. The plaintiffs in the case sought to assert claims for strict products liability, negligence, and breach of implied and express warranties on behalf of the nationwide class, and also sought certification of a statewide class of Kansas fuel purchasers alleging consumer fraud. The defendant moved to strike both proposed classes, and the court determined that the motion was properly treated as a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). With respect to the proposed nationwide class, the court granted the motion to dismiss in light of the need to apply the law of each proposed class member's home state to resolve his or her claims. While the plaintiffs argued that discovery may reveal that the proposed class members reside in fewer than 50 states — and that those states may have overlapping laws — the court rejected this argument and found that the "burden of applying the products liability and warranty laws of each class member's state defeats predominance and, thus, nationwide class certification." The court, however, refused to dismiss the proposed Kansas-only, consumer-fraud class for lack of factual predominance. In so holding, the court noted that the plaintiffs had not clearly alleged whether their consumer fraud claims were based on an alleged omission or misrepresentation, which would affect the elements they would have to prove at a class trial. The court therefore permitted the plaintiffs to amend their complaint and reallege their consumer fraud claims under Kansas law.

Taylor v. Denka Performance Elastomer LLC, No. CV 17-7668, 2018 WL 1010186 (E.D. La. Feb. 22, 2018), 23(f) pet. denied

Judge Martin L. C. Feldman of the U.S. District Court for the Eastern District of Louisiana denied the plaintiffs' motion to reconsider the court's order denying the motion for extension of time to file a motion for class certification and granted the defendant's motion to strike the plaintiffs' motion for class certification. The plaintiffs alleged that the production of synthetic rubber at the defendant's facility emitted a carcinogen, resulting in a significantly increased risk of cancer. The court found that the plaintiffs missed the deadline to file a motion for class certification, and their request for an extension to file was denied as untimely. The court also rejected the plaintiffs' argument that the filing of an amended notice of removal reset the 91-day clock for filing a class certification motion. Accordingly, the court dismissed the class allegations for failure to timely seek class certification.

Decisions Denying Motions to Strike

Doe v. Trinity Logistics, Inc., No. 17-53-RGA-MPT, 2018 WL 1610514 (D. Del. Apr. 3, 2018), report and recommendation adopted, 2018 WL 2684109 (D. Del. June 5, 2018)

Judge Richard G. Andrews of the U.S. District Court for the District of Delaware adopted the report and recommendation of Chief Magistrate Judge Mary Pat Thynge and denied the defendants' motion to strike class claims under the federal Fair Credit Reporting Act (FCRA). The plaintiff, on behalf of putative class members, alleged that the defendants, a consumer reporting agency and an employer, created and used consumer reports to take adverse employment actions without informing potential employees or providing them with copies of the reports as required by law. In recommending that the motion to strike be denied, the magistrate judge essentially conducted a full class certification analysis under Rule 23. Specifically, she found that the proposed class satisfied the Rule 23(a) requirements, noting that common issues of fact and law — e.g., whether the uniform failure to timely provide a copy of employment reports violates the FCRA — existed and the claims were typical because all putative class members were similarly affected by the defendants' actions. The magistrate judge also indicated that the class satisfied the predominance and superiority requirements of Rule 23(b)(3) because common questions of law and fact, including whether the defendants willfully or negligently failed to provide class members notice before taking an adverse action against them, predominated over individual issues. The magistrate judge also found that the class definition was objective and not conclusory, rejecting the defendants' argument that because the class definition nearly parroted the statute's language, the court would have to conduct individualized inquiries to discern whether each putative class member fit in the class. Accordingly, the court ruled against striking the class claims.

Butterline v. Bank of New York Mellon Trust Co., National Ass'n, No. 15-1429, 2018 WL 1705957 (E.D. Pa. Apr. 6, 2018)

Judge Juan R. Sánchez of the U.S. District Court for the Eastern District of Pennsylvania denied a motion to strike class claims alleging that the defendant bank failed to give putative class members excess proceeds from foreclosure sales, in violation of state law. The court rejected the defendant's contention that the class was not ascertainable, accepting the plaintiffs' argument that class members could be identified from records of sheriff sales where the bank received excess proceeds. The court also postponed a decision on predominance until after class discovery given the scant amount of attention devoted to predominance in the parties' briefing.

Casso's Wellness Store & Gym, L.L.C. v. Spectrum Laboratory Products, Inc., No. 17-2161, 2018 WL 1377608 (E.D. La. Mar. 19, 2018)

Judge Kurt D. Engelhardt of the U.S. District Court for the Eastern District of Louisiana denied defendant Spectrum's motion to dismiss and/or strike class allegations (1) for lack of personal jurisdiction under Bristol-Myers Squibb Co. v. Superior Court of California, 137 S. Ct. 1773 (2017); (2) as inappropriate for class treatment under Rules 23(c)(1)(A) and 23(d)(1)(D); and (3) as unconstitutional under the Fifth Amendment's due process clause. The plaintiff had filed a putative class action, alleging violations of the Telephone Consumer Protection Act (TCPA), as amended by the Junk Fax Prevention Act (JFPA). The plaintiff sought damages and injunctive relief for Spectrum's massive faxing campaign that allegedly failed to comply with mandatory opt-out notice requirements under the TCPA, JFPA and Federal Communications Commission regulations. The plaintiff proposed a class defined as: "All persons and entities that are subscribers of telephone numbers to...