Opinion
No. X04 CV03 4005909 S
November 5, 2007
RULING ON MOTION FOR CLASS CERTIFICATION
The plaintiff Titus Moore claims that the defendant has engaged in improper practices in the course of attempting to collect credit card debt and has brought this action against the defendant Midland Credit Management, Inc. ("Midland"). He has moved (#171) for an order that the action proceed as a class action on behalf of all persons situated similarly to himself.
The general test whether to certify a class action has been stated several times by our Supreme Court. For example, the court said recently in Collins v. Anthem Health Plans, Inc. ( Collins II), 275 Conn. 309, 320-23 (2005):
[W]e set forth the standard of review governing class certification orders. A trial court must undertake "a rigorous analysis" to determine whether the plaintiffs have borne the burden of demonstrating that the class certification requirements of Practice Book §§ 9-7 and 9-8 have been met. (Internal quotation marks omitted.) Collins v. Anthem Health Plans, Inc., [ 266 Conn. 12, 23 (2003)]. A trial court nonetheless "has broad discretion in determining whether a suit should proceed as a class action." (Internal quotation marks omitted.) Id. As long as the trial court "has applied the proper legal standards in deciding whether to certify a class, its decision may . . . be overturned [only] if it constitutes an abuse of discretion." (Internal quotation marks omitted.) In re Visa Check/Mastermoney Antitrust Litigation, 280 F.3d 124, 132 (2d Cir. 2001), cert. denied, 536 U.S. 917, 122 S.Ct. 2382, 153 L.Ed.2d 201 (2002).
CT Page 18787
[I]n determining whether to certify the class, a [trial] court is bound to take the substantive allegations of the complaint as true. (Internal quotation marks omitted.) Collins v. Anthem Health Plans, Inc., supra, 266 Conn. 24. That does not mean, however, that a court is limited to the pleadings when determining whether the requirements for class certification have been met. On the contrary, we stated in Collins that "[t]he class determination generally involves considerations that are enmeshed in the factual and legal issues comprising the [plaintiffs'] cause of action"; (internal quotation marks omitted) id.; and that "it [sometimes] may be necessary for the court to probe behind the pleadings before coming to rest on the certification question." (Internal quotation marks omitted.) Id. "In determining the propriety of a class action, [however] the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of [the class action rules] are met." (Internal quotation marks omitted.) Id., 24-25. "Although no party has a right to proceed via the class mechanism . . . doubts regarding the propriety of class certification should be resolved in favor of certification." (Citation omitted; internal quotation marks omitted.) Rivera v. Veterans Memorial Medical Center, 262 Conn. 730, 743, 818 A.2d 731 (2003).
The rules of practice set forth a two step process for trial courts to follow in determining whether an action or claim qualifies for class action status. First, a court must ascertain whether the four prerequisites to a class action, as specified in Practice Book § 9-7, are satisfied. These prerequisites are: "(1) numerosity — that the class is too numerous to make joinder of all members feasible; (2) commonality — that the members have similar claims of law and fact; (3) typicality — that the [representative] plaintiffs' claims are typical of the claims of the class; and (4) adequacy of representation — that the interests of the class are protected adequately." Id., 738, citing Practice Book § 9-7; accord Collins v. Anthem Health Plans, Inc., supra, 266 Conn. 33.
Second, if the foregoing criteria are satisfied, the court then must evaluate whether the certification requirements of Practice Book § 9-8 are satisfied. These requirements are: (1) predominance — that "questions of law or fact common to the members of the class predominate over any questions affecting only individual members"; and (2) superiority — that "a class action is superior to other available methods for the fair and efficient adjudication of the controversy." Practice Book § 9-8. Because our class certification requirements are similar to those embodied in rule 23 of the Federal Rules of Civil Procedure,8 and our jurisprudence governing class actions is relatively undeveloped, we look to federal case law for guidance in construing the provisions of Practice Book §§ 9-7 and 9-8. See Collins v. Anthem Health Plan, Inc., supra, 266 Conn. 32.
With these principles in mind, we turn to the allegations of the complaint. The currently operative complaint is the second revised complaint dated November 24, 2003. As introductory "facts," the plaintiff alleges that the action is brought pursuant to General Statutes § 42-110b and that the defendant is licensed as a consumer collection agency. Pursuant to General Statutes § 36a-805(3), an entity may not purchase claims for the purpose of collection. Facts stated to be made in relation to Moore's claim as an individual are that in August 2002, he was sued by the defendant and that the complaint alleged that Midland had purchased his credit card account. Facts stated to be made in relation to the putative class's claim are that Midland brought more than 150 similar actions on credit card counts alleged to have been sold to Midland, that the representation was false, and that payments were collected from more than 100 people. Citing Practice Book § 9-7 and General Statutes § 42-110g (CUTPA claims may be brought by the vehicle of class actions), the plaintiff stated that he was bringing the action on behalf of himself and others similarly situated, who had been the object of collection efforts based on a claim that Midland owned or had been assigned the account.
Section 42-110b states the intent of the legislature to prohibit unfair trade practices.
In the first count, the plaintiff incorporated the above allegations and claimed that Midland's conduct violated 15 U.S.C. § 1692k, a section of the Federal Fair Debt Collection Practices Act. The second count incorporates the allegations and claims that Midland violated Connecticut General Statutes § 42-110g, a section of the Connecticut Unfair Trade Practices Act. Claims for relief include a refund of all monies paid by class members on or after February 1, 2000; the vacating all judgments entered on the complaints brought by Midland; actual damages, punitive damages and statutory damages; and costs and attorneys fees pursuant to 15 U.S.C. § 1692k, and C.G.S. §§ 42-110g and 52-568 (vexatious litigation). In its answer and defenses, Midland agreed, with some reservation, with much of the factual recitation and pled defenses of, inter alia, good faith error in the notices.
See 15 U.S.C. § 1692k(c).
The task of the court, as noted in Collins II, supra, and Collins v. Anthem Health Plans, Inc. ( Collins I), 266 Conn. 12 (2003), is to analyze the pleadings with reference to the requirements of Practice Book §§ 9-7 and 9-8. See also General Statutes § 52-105. Section 9-7 of the Practice Book states that "[o]ne or more members of a class may sue or be sued as representatives parties on behalf of all only if (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 represent protect the interests of the class." It is the burden of the party seeking class certification, in this case the plaintiff, to show that each of the factors is satisfied.
It also should be noted that our Supreme Court has recognized that "partial class actions" are in some circumstances appropriate; that is, a class may be certified for the purpose of litigating some of the specific claims raised in a complaint, while proceeding by class action may be an inappropriate vehicle for the litigation of other claims. Collins I, supra, 25.
We now turn to a consideration of each of the Practice Book § 9-7 factors. Numerosity does not seem to be hotly disputed. Although the number of putative class members appears to be somewhat disputed, there would appear to be at least one hundred members of the proposed class and perhaps many more. As stated in Arduini v. Automobile Ins. Co. of Hartford, Connecticut, 23 Conn.App. 585, 590 (1990), there is no "magic number" that provides a watershed, because "numerosity is tied to the impracticability of joinder under the particular circumstances of the case." Id. In Arduini, ten or eleven prospective members did not justify the certification of a class where joinder was available. In CT Page 18790 Robidoux v. Celani, 987 F.2d 931, 935 (2d Cir. 1993), the Second Circuit suggested that a group of forty might presumptively be considered large enough to make joinder unwieldy and impractical. I find that the plaintiff has sustained his burden in this case of satisfying the numerosity factor; joining more than a hundred cases would be unwieldy.
The factors of commonality and typicality are more troublesome in the context of this case. Commonality is relatively easy to satisfy: the members of the class must satisfy "a common element of law or fact." Collins II, supra, 323. If all class members would share a common argument as to an issue in the case, the commonality factor is satisfied. Id., 324. The question whether there are also individualized positions is relevant to considerations of predominance and superiority, the factors listed in Practice Book § 9-8, but are not pertinent to the inquiry regarding commonality. Id., 325.
Typicality stands on somewhat different footing. This factor is satisfied if the named plaintiff's claims are typical of the claims of the class. According to Collins I, at 266 Conn. 33-34:
The United States Supreme Court has explained that . . . [commonality and typicality] "tend to merge. Both serve as guideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff[s'] claim [for which the court has granted class certification] and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence. Those requirements therefore also tend to merge with the adequacy-of-representation requirement, although the latter requirement also raises [other] concerns . . ." General Telephone Co. of the Southwest v. Falcon, supra, 457 U.S. 157 n. 13. "These requirements effectively limit the class claims to those fairly encompassed by the named plaintiff[s'] claims." (Internal quotation marks omitted.) Id., 156
As the United States Court of Appeals for the Second Circuit has stated, "[t]he commonality requirement is met if [the] plaintiffs' grievances share a common question of law or of fact . . . Typicality, by contrast, requires that the claims of the class representatives be typical of those of the class, and is satisfied when each class member's claim arises from the same course of events, and each class member makes similar legal arguments to prove the defendant's liability." (Citations omitted; internal quotation marks omitted.) Marisol A. v. Giuliani, supra, 126 F.3d 376. The typicality "criterion does not require that the factual background of each named plaintiff's claim be identical to that of all class members; rather, it requires that the disputed issue of law or fact occupy essentially the same degree of centrality to the named plaintiff's claim as to that of other members of the proposed class." (Internal quotation marks omitted.) Caridad v. Metro-North Commuter R., 191 F.3d 283, 293 (2d Cir. 1999), cert. denied, 529 U.S. 1107, 120 S.Ct. 1959, 146 L.Ed.2d 791 (2000). (Footnotes omitted).
Again, the typicality factor does not require identity of issue; rather, the more limited inquiry is whether the disputed issue of law or fact occupies the same degree of centrality to the plaintiff's claim as to that of the other members of the proposed class. The analysis is similar to that used in the consideration of the commonality element: the plaintiff's factual position in its entirety need not be "typical" of that of all of the members of the proposed class. The plaintiff's position as to a central, disputed issue must be "typical" of that of the remainder of the class, which must share the same central, disputed issue.
The pleadings suggest that the plaintiff shares a common issue with the other members of the proposed class, which is "all natural persons, residents of the State of Connecticut, who, on or after February 1, 2000, were the subject of collection efforts based on the claim that [Midland] was the assignee, purchaser, or owner of a credit account originated by an identified creditor." A common claim is that Midland's claim was wrong and violated the statutory provisions noted above. The defense of bona fide error likewise is common to the proposed class. The plaintiff was the recipient, allegedly, of such a claim, and to the extent that statutory damages are appropriate, the plaintiff's claim would appear to be typical, as defined above, of that of the class. I find that the plaintiff has satisfied his burden of showing commonality and typicality.
The final factor required by Practice Book § 9-7 is adequacy of representation. Again, for the purpose of § 9-8, the requirement is not stringent. It is two-fold: counsel must be competent and the plaintiff must not have a conflict of interest with other members of the proposed class such that representation of both counsel and the representative plaintiff will be fair and vigorous. Collins II, supra, 326. The defendant agrees that counsel are competent. An examination of the pleadings reveals that the plaintiff does not have a direct conflict of interest with other members of the proposed class: the plaintiff claims to have received papers with the allegedly improper language and seeks statutory damages. There perhaps could be a tenuous and indirect conflict regarding other relief requested, in that the named plaintiff is apparently himself ineligible for at least some of the claimed relief for the class. There is the potential, albeit remote at this point, possibility that the plaintiff could be economically motivated to pursue with less vigor those claims of relief to which he himself may not be entitled. At least insofar as the relief is limited to statutory damages, however, it is quite clear that there is no conflict of interest. The plaintiff has satisfied the burden of showing compliance with the adequacy factor.
The requirements of Practice Book § 9-7 are, then, satisfied. The inquiry, however, does not end here. Practice Book § 9-8 states:
An action may be maintained as a class action if the prerequisites of Section 9-7 are satisfied and the judicial authority finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. (Emphasis added.)
The factors to consider in deciding whether common questions of fact and law predominate over individualized issues, and, relatedly, whether a class action is superior to other available methods, ultimately derive from the theoretical and practical underpinnings of class actions in general: whether the economies in proceeding as a class outweigh any procedural unfairness. Collins I, supra, 27, 50; Collins II, supra, 329. Considerations of procedural unfairness relate in large part to the protection of the interests of members of the proposed class, who, after all, are bound by the results. Our Supreme Court analyzed the predominance and superiority requirements in Collins II. The following quotation is lengthy, but aptly and thoroughly summarizes the standards applied by this court and the analysis used to reach its conclusion:
[T]he fundamental purpose of the predominance inquiry is to determine "whether the economies of class action certification can be achieved . . . without sacrificing procedural fairness or bringing about other undesirable results." (Citation omitted; internal quotation marks omitted.) Collins v. Anthem Health Plans, Inc., supra, 266 Conn. 50. We stated that "[c]lass-wide issues predominate if resolution of some of the legal or factual questions that qualify each class member's case as a genuine controversy can be achieved through generalized proof, and if these particular issues are more substantial than the issues subject only to individualized proof." (Emphasis added; internal quotation marks omitted.) Id., 48.
In order to determine whether common questions predominate, [a court must] . . . examine the [causes] of action asserted in the complaint on behalf of the putative class . . . Whether an issue predominates can only be determined after considering what value the resolution of the class-wide issue will have in each class member's underlying cause of action. (Citation omitted; internal quotation marks omitted.) Rutstein v. Avis Rent-A-Car Systems, Inc., 211 F.3d 1228, 1234 (11th Cir. 2000), cert. denied sub nom. Zeirei Agudath Israel Bookstore v. Avis Rent-A-Car Systems, Inc., 532 U.S. 919, 121 S.Ct. 1354, 149 L.Ed.2d 285 (2001). "Common issues of fact and law predominate if they ha[ve] a direct impact on every class member's effort to establish liability and on every class member's entitlement to injunctive and monetary relief . . . [When], after adjudication of the classwide issues, [the] plaintiffs must still introduce a great deal of individualized proof or argue a number of individualized legal points to establish most or all of the elements of their individual[ized] claims, such claims are not suitable for class certification . . . See Perez v. Metabolife Int'l., Inc., 218 F.R.D. 262, 273 (S.D.Fla. 2003) (declining class certification in part because any efficiency gained by deciding the common elements will be lost when separate trials are required for each class member in order to determine each member's entitlement to the requested relief)." (Citation omitted; internal quotation marks omitted.) Klay v. Humana, Inc., 382 F.3d 1241, 1255 (11th Cir. 2004).
[N]umerous [federal] courts have recognized [however] that the presence of individualized damages issues does not prevent a finding that the common issues in the case predominate. Allapattah Services, Inc. v. Exxon Corp., 333 F.3d 1248, 1261 (11th Cir. 2003), aff'd sub nom. Exxon Mobil Corp. v. Allapattah Services, Inc., U.S., 125 S.Ct. 2611, 162 L.Ed.2d 502 (2005). In assessing the predominance requirement in cases involving individualized damages, "the [c]ourt's inquiry is limited to whether . . . the proposed methods [for computing damages are so insubstantial as to amount to no method at all . . . [The plaintiffs] need only come forward with plausible statistical or economic methodologies to demonstrate impact on a class-wide basis." (Internal quotation marks omitted.) Klay v. Humana, Inc., supra, 382 F.3d 1259, quoting In re Terazosin Hydrochloride Antitrust Litigation, 220 F.R.D. 672, 698 (S.D.Fla. 2004). Particularly [when] damages can be computed according to some formula, statistical analysis, or other easy or essentially mechanical methods, the fact that damages must be calculated on an individual basis is no impediment to class certification.
It is primarily when there are significant individualized questions going to liability that the need for individualized assessments of damages is enough to preclude [class] certification. See, e.g., [ Sikes v. Teleline, Inc., 281 F.3d 1350, 1366 (11th Cir.)] (These claims will involve extensive individualized inquiries on the issues of injury and damages — so much so that a class action is not sustainable.) [cert. denied sub nom. Sikes v. American Telephone Telegraph Co., 537 U.S. 884, 123 S.Ct. 117, 154 L.Ed.2d 143 (2002)]; [ Rutstein v. Avis Rent-A-Car Systems, Inc., supra, 211 F.3d 1234, 1240] (declining to certify a class because most, if not all, of the plaintiffs' claims will stand or fall . . . on the resolution of . . . highly case-specific factual issues and liability for damages is a necessarily individualized inquiry). Klay v. Humana, Inc., supra, 382 F.3d 1259-60; see also Kohn v. American Housing Foundation, Inc., 178 F.R.D. 536, 542-44 (D.Colo. 1998) (class certification inappropriate because injury suffered by each class member was highly individualized and could not be separated from causation inquiry).
These standards inform us that a court should engage in a three-part inquiry to determine whether common questions of law or fact predominate in any given case. First, the court should review the elements of the causes of action that the plaintiffs seek to assert on behalf of the putative class. Rutstein v. Avis Rent-A-Car Systems, Inc., supra, 211 F.3d 1234. Second, the court should determine whether generalized evidence could be offered to prove those elements on a class-wide basis or whether individualized proof will be needed to establish each class member's entitlement to monetary or injunctive relief. Klay v. Humana, Inc., supra, 382 F.3d 1255. Third, the court should weigh the common issues that are subject to generalized proof against the issues requiring individualized proof in order to determine which predominate. See Collins v. Anthem Health Plans, Inc., supra, 266 Conn. 48. Only when common questions of law or fact "will be the object of most of the efforts of the litigants and the court" will the predominance test be satisfied. Snyder Communications, L.P. v. Magana, 142 S.W.3d 295, 300 (Tex. 2004).
Collins II, supra, 329-32.
We now apply the three-step analysis to the circumstances of this case. The elements of the causes of action which the plaintiff seeks to assert on behalf of the class involve, in the first count, the conduct by the defendant in claiming, in court documents, that it had purchased the debtors' accounts. The statements purportedly violated 15 U.S.C. § 1692k, in that they were false. See, e.g., 15 U.S.C. § 1692e(10). The second count mirrors the first and incorporates the same factual allegations. It alleges a violation of Connecticut General Statutes § 42-110g, a section of CUTPA. The relief sought as to both counts includes a refund of all monies paid after February 1, 2000; vacating all judgments entered on the complaints; the rectification of any harm to credit accounts; actual, punitive and statutory damages; and costs and attorneys fees pursuant to several statutes.
The second step is to determine which elements may be proved — or, presumably, disproved as well — by generalized evidence and which will require individualized evidence. This part of the analysis necessarily involves a degree of prediction and, therefore, estimation. In any event, it seems clear that the documents generated by the defendants were most likely mass produced and are subject to generalized evidence as to the manner of their production (if relevant) and the "bona fide error" defense. Statutory damages appear to focus on the conduct of the defendant rather than the individualized effects upon the plaintiffs; thus, generalized evidence appears to predominate. As to statutory damages, I also find that a class action is superior to other available remedies: the economies of presenting one set of generalized proof, in both prosecution and defense, far outweigh any potential procedural unfairness. Over a hundred individual actions, whether or not joined, would foster expense and burdensomeness, with little benefit. I find, then, that a partial class action as to statutory damages satisfies the predominance and superiority requirements and that the plaintiff has satisfied the burden of showing the same.
The situation is different as to the other claims of damages, however. As noted several times above, damages such as damage to credit, vacation of judgments, return of any monies paid, and the like, are sought. To a greater or lesser degree, these items of damages require individualized proof that may well vary from plaintiff to plaintiff and are not "formulaic." Depending of course on factors that are difficult to predict with precision, it may well be that the generalized proof will be routine and limited, while the individualized proof may be more detailed and protracted. In these circumstances, the plaintiff has not shown that a class action as to other than statutory damages satisfies the requirements of predominance and superiority.
I therefore certify that class as to statutory damages, but not as to the other types of claimed damages. The plaintiff shall prepare an order consistent with this decision for submission to the court.
The defendant has suggested that I should consider to some extent the merits of the dispute and refuse to certify the class. I believe that the authority suggests that the merits of the controversy should be examined for the purpose of analyzing the factors listed in §§ 9-7 and 9-8 of the Practice Book, but not for the more generalized purpose of whether the cause of action as a whole has any merit. This decision, of course, is not to be taken as an expression of any opinion regarding the merits.