‘Ascertainability’ is no silver bullet in class action defense

October 16, 2014

I’ll admit it: I was among the predictors of doom last year when a three-judge panel of the 3rd U.S. Circuit Court of Appeals issued its decision in Carrera v. Bayer. The Carrera decision, as you may recall, addressed the requirement that class membership be “ascertainable” in order for class actions to be certified. The facts of the case – a consumer class action claiming deceptive labeling of a Bayer diet supplement – were idiosyncratic, but the appellate holding that affidavits from purported purchasers aren’t sufficient to ascertain class membership seemed broad indeed. Consumer class action advocates asked for en banc review, asserting a credible argument that the decision was a death knell for claims based on low-cost items for which purchasers don’t save receipts. The 3rd Circuit declined to hear the case en banc, but in a dissent, four judges said they were worried that the Carrera decision went too far, giving rise to “fear that some wrongs will go unrighted because wrongdoers gamed the system.”

After Carrera, ascertainability has become one of the buzziest words in class actions. (And yes, I’m aware of the nerdiness of living in a world where “ascertainability” can fairly be described as a hot topic.) When Hershey, for instance, filed its Oct. 14 opposition to the certification of a class of purchasers of its Special Dark chocolate products, its primary argument was that class membership can’t be ascertained. Consumers don’t save receipts for chocolate bars, Hershey said, and even good faith affidavits from purchasers are unreliable because it’s hard to remember if you bought a particular kind of chocolate in a specific time period.

The Hershey brief got me wondering just how effective defendants’ ascertainability arguments have been since Carrera. Has the decision really been the class action killer it was billed to be? Hershey and other class action defendants certainly say so in their briefs opposing class certification. Hershey’s memo cites eight decisions – just in food-labeling cases in federal court in California – that have denied class certification to supposedly unascertainable classes. “Numerous federal courts in California and elsewhere have followed Carrera, especially in cases where, as here, the product at issue is a low-cost grocery item,” Hershey said in its brief.

But I also knew that some judges have rejected Carrera’s reasoning. As U.S. District Judge Jesus Bernal of Riverside, California, said in an oft-quoted decision in January 2014 in McCrary v. The Elations Company, “While (Carrera) may now be the law in the 3rd Circuit, it is not currently the law in the 9th Circuit.” Bernal’s McCrary opinion certified a class of purchasers of a dietary supplement for joint pain even though plaintiffs said consumer affidavits were the only way to ascertain class membership. And just last month, U.S. District Judge Jon Tigar of San Francisco certified a class suing Jamba Juice, distinguishing between the certification process and the claims process in a case where damages are determined in the aggregate. “If the problem is that some absent class members may get less relief than they are entitled to” because of false claims by people who didn’t actually purchase the juice, he wrote, “it would be a strange solution to deprive absent class members of any relief at all.”

I went to Westlaw to check the stats on Carrera. It’s been cited in 45 decisions, most of them in 2014. Many of those opinions, as Hershey said in its brief, have adopted the 3rd Circuit’s ascertainability analysis, even in trial courts in other federal circuits. But at least nine judges have rejected or declined to apply Carrera. Some, including federal district judges in New York, New Jersey and Kansas, said Carrera is besides the point when plaintiffs present a sound method for identifying class members. Other judges have followed Bernal’s reasoning that as long as the class is well defined, consumer affidavits are an adequate method for establishing class membership. (Judge Tigar’s recent Jamba Juice decision provides the deepest analysis of why that’s enough to certify a class.)

To me, the most interesting Carrera rejections to date have come from U.S. District Judge Lucy Koh of San Jose, because Koh has also adopted the 3rd Circuit analysis of ascertainability. Koh certified classes in cases accusing Blue Diamond of deceiving consumers about the ingredients in its almond milk and claiming that Dole mislabeled eight fruit products as “all natural,” yet she deemed a class asserting that Gerber made false claims about its baby food to be uncertifiable. On the surface, the cases are similar, and all of them proposed identifying class members through purchasers’ affidavits. Since Koh reached different conclusions about whether that’s adequate, it’s worth looking at her analysis.

In the Blue Diamond and Dole cases, Koh said that consumer affidavits were likely to be a reliable way to ascertain class membership because class claims involved products with the same allegedly misleading labels and class periods that were relatively short. Consumers, she said, weren’t likely to be confused about whether they purchased the supposedly deceptive products during the relevant time frame so their affidavits would be reliable. The proposed classes, Koh said, were “sufficiently definite to identify putative class members.”

That wasn’t true, however, of the class Koh refused to certify in June, in a case alleging that Gerber mislabeled 69 types of baby food over a five-year period. Koh acknowledged her previous certifications in the Blue Diamond and Dole cases, and rejected Gerber’s argument that the class couldn’t be certified because it had no records of consumer purchases. But she said that unlike the Dole fruit and Blue Diamond almond milk buyers, baby food consumers “will not be able to reliably determine whether or not they are eligible to join the class.” Gerber’s labels changed frequently, she said, and the class didn’t make claims about all of the baby foods in the category at issue in the case. Koh said it just wasn’t reasonable to expect that consumers would remember the specific labeling on the particular baby foods they bought.

“The number of products at issue in this case, the varieties included and not included in the class definition, the changes in product labeling throughout the class period, the varied and uncertain length of time it takes for products with new labels to appear on store shelves, and the fact that the same products were sold with and without the challenged label statements simultaneously make plaintiff’s proposed class identification method administratively unfeasible,” she wrote.

There are valuable lessons for consumer class action lawyers in Koh’s opinions: Keep your case tightly focused and make sure your class is well defined. That’s not a guarantee that you’ll survive Carrera scrutiny, even in California, but it will definitely boost your chances.

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