The Third Circuit recently vacated a trial court’s decision that members of a putative class were not readily ascertainable by reference to objective criteria. City Select Auto Sales Inc. v. BMW Bank of North America Inc., 867 F.3d 434 (3d Cir. 2017). Although it did not find that a class was in fact ascertainable, it held that the trial court misapplied the ascertainability standard and remanded for further proceedings. Id. at 443.
The Defendants in City Select are Creditsmarts Corporation (which helps car dealers connect customers with lenders) and BMW Bank of North America, Inc. and BMW Financial Services NA, LLC (which offer automotive financing through a division called “up2drive”). Id. at 436. In late 2012, Creditsmarts used a vendor to send approximately 21,000 fax advertisements for BMW to car dealers. However, neither Creditsmarts nor the vendor retained a list of recipients. Id. at 437. After receiving one of the faxes, Plaintiff filed a complaint that asserted TCPA claims on behalf of a putative class defined as: “All auto dealerships that were included in the Creditsmarts database on or before December 27, 2012, with fax numbers identified in the database who were sent one or more telephone facsimile messages between November 20, 2012 and January 1, 2013, that advertised the commercial availability of property, goods or services offered by [BMW].” Id.
During the course of class certification discovery, the trial court denied Plaintiff’s motion to compel production of the Creditsmarts database because Plaintiff had (i) previously agreed not to seek production of the database before a ruling on class certification, (ii) delayed seeking to compel production, and (iii) not shown that disclosure of the entire database was necessary for addressing certification, as defendants had already produced exemplar pages from the database. Id. & n.1. The trial court subsequently denied Plaintiff’s motion for class certification, reasoning that there was no reliable and administratively feasible way to determine which customers were actually sent the fax at issue, and thus whether putative class members fell within the class definition. Id. at 438.
The Third Circuit vacated that order, reasoning that: (i) the district court was wrong to hold that affidavits can never be used in the ascertainability analysis; and (ii) because the Creditsmarts database was not produced in discovery, Plaintiff had been denied the opportunity to demonstrate the existence of a reliable, administratively feasible method of ascertaining the class based, in whole or in part, on the database. Id. at 440-41. It explained that plaintiffs need not establish “that a single record, or set of records, conclusively establishes class membership,” but rather must only establish that there are “objective criteria for class membership” and “a reliable and administratively feasible means of determining whether these criteria are met” at the class certification stage. Id. at 441. It then observed that “[a]ffidavits, in combination with records or other reliable and administratively feasible means,” may be one way to meet this standard. Id.
Although the available database was over-inclusive, the Third Circuit reasoned that it allowed for notice to potential class members and limited the universe of potential claimants. The court stated:
Even if it is true that the BMW fax was not sent to every customer who had a fax number in the database during the relevant time period, the class could still be certified, so long as there is a method for determining whether customers did receive such faxes, which could be by affidavit. While a high degree of over-inclusiveness could prevent certification, any degree of over-inclusiveness will not do so.
Id. at 442 n.4 (underlined emphasis added). While the court speculated that the factual inquiry of determining whether particularly dealerships in the database received the fax at issue may not “necessarily require individualized fact-finding that would be ‘administratively infeasible’ or ‘a violation of Defendants’ due process rights,’” it acknowledged that it was limited by the record in the case because the database had not been produced. Id. at 442 (emphasis added). Therefore, it could take no position on whether the class could ultimately be ascertainable. Id.
Class action plaintiffs may argue that the City Select decision weakens the Third Circuit’s ascertainability standard on class certification. However, the Third Circuit emphasized that “[t]he determination [of] whether there is a reliable and administratively feasible mechanism for determining whether putative class members fall within the class definition must be tailored to the facts of the particular case,” and that “[t]he amount of over-inclusiveness . . . of the proposed records is a critical consideration.” Id. Further, the court cautioned that “[a]ffidavits from potential class members, standing alone, without ‘records to identify class members or a method to weed out unreliable affidavits,’ will not constitute a reliable and administratively feasible means of determining class membership.” Id. at 441 (emphasis added).
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