Appeals Court Re-inflates Kiddie Pool Class Action

• Author: Stephen Carr
• Pages: 24-24

making settlement offers,” Gevertz

advises. “I wo uld always seek

approval from the co urt or the DOL .

You certainly do not wan t to tell a

client that the ca se is resolved, only

to find out that plai ntiffs can rei n-

stitute the claims an d case,” Austin

recommends.

Appeals Court

Re-inf‌lates Kiddie

Pool Class Action

By Stephen Car r, Litigation News

Associa te Editor

Consumer cla ss action claim s are

often numerous, but low-value.

Sales records m ay not contain much

information abo ut the actual con-

sumer, and it can be ch allenging for

plaintis to mee t the “ascertain -

ability” req uirement for class action

certif‌ic ation. Courts h ave split over

whether this requirement means

that plaintis si mply need an objec-

tive def‌inition to determine whether

plaintis are in o r out of the class, or

whether plainti s must also present

a plan for identif ying and contacting

all, or most, of th e class member s.

A California Su preme Court deci-

sion has embra ced a more liberal

approach to the qu estion and could

provide new oppor tunities to pur-

sue consumer cl ass actions. A BA

Litigation Secti on leaders be lieve

the ruling will op en the door to more

consumer class actions.

Noel v. Thrifty P ayless, Inc., began

with a claim under C alifornia unfair

competition law, false advertis-

ing law, and the Consu mers Legal

Remedies Act . The plainti alleged

that the drugstore c hain Rite Aid

misled consum ers in advertisi ng an

inf‌latable chi ldren’s pool. Discovery

revealed that Rite Aid ha d sold more

than 20,000 p ools during the class

period and collected revenue of

just under a mil lion dollars . But the

plaintis did not determine whether

sucient record s existed to provide

notice to the relevant con sumers.

The lower court ref used to cer-

tify the class , f‌inding that the plain-

tis had “prese nted no evidence”

as to whether members of the class

could be identif‌ied through busi-

ness practice s or record keeping by

Rite Aid. This infor mation might have

been necess ary for providing notice

to absent class members. The inter-

mediate appell ate court armed,

but the Califor nia Supreme Court

reversed on the asce rtainability issue.

The Californi a Supreme Court

identif‌ied two vi ews of ascertaina bil-

ity. The f‌irst, more re laxed standard

“concentrates on the p roposed class

def‌inition itse lf.” Under this view, it is

sucient that th e class is describ ed

in the motion to certif y “in terms of

objective characteristics and com-

mon transactional facts” that make

it possible to determ ine whether a

person is a mem ber of the class at a

later stage. Th e second, more st rin-

gent standa rd requires the plai nti

to present specif‌i c evidence that

there is a mechan ism “through which

class membe rs could be identi f‌ied

so as to be persona lly notif‌ied of the

class proceeding.”

Jurisdictio ns across the countr y

are split on which ap proach is more

appropriate, exp lains Adam E. Pol k,

San Francisco, C A, cochair of th e

Litigation Secti on’s Class Actions &

Derivative Suits Co mmittee. “Courts

that embrace the relaxed approach

focus on whether t he class is objec-

tively def‌ined, a nd have found that

concerns abou t the ability to iden-

tify class mem bers are already

addressed as p art of the manag e-

ability analys is,” Polk says. “Co urts

taking the more s tringent appro ach

focus on the due pro cess concerns

that could arise if a cl ass settles

without an adeq uate method to pro-

vide notice to parti es bound by the

settlement.”

The Noel court appeared espe-

cially concern ed that in low-value

consumer class actions, identifying

business reco rds for all consume rs

would be especia lly dicult, if not

impossible. “The court’s approach

to ascertaina bility will make it po s-

sible for more cons umer class

actions to get pas t certif‌icatio n,”

reports Do nald R. Pocock , Winston-

Salem, NC , cochair of the Section’s

Consumer Litigation Committee.

Section leaders acknowledge

strong argume nts on both sides of

the issue. “I n the court’s view, whe re

class certif‌ic ation occurs before the

need for notice to cla ss members of

a settlement or tr ial arises, an a scer-

tainability requirement unfairly bur-

dens class representatives who might

otherwise develo p adequate means

of notice,” Pocock expl ains. “Some

might be concern ed that this will

encourage claims of questionable

merit, but one of th e justif‌ications for

class actions i s the power to vindicate

small claims.”

Standing Strong

to Challenge an

Unconstitutional

Statute

By Mark A. Flo res, Litigation News

Associa te Editor

A federal appe llate court has curbed

a state’s attempt to limit ro bocalls

as violative of the Firs t Amendment .

Robocall sta tutes have previously

placed constitut ionally valid time ,

place, and man ner restrictions on

annoying automate d calls. But

Montana’s robocall statute, Montana

Code Sectio n 45-8-216 , placed

content-based restrictions on calls

related to the sale of go ods and ser-

vices and the prom otion of politi-

cal campaig ns. As a result, th e court

held the restric tion violated the First

Amendment.

In Victory Pr ocessing, LLC v. Fox,

a Michigan poli tical consulting and

data-gathering services f‌irm brought

suit in Montana D istrict Court alleg-

ing that the statute ch illed the con-

sultant’s spe ech by limiting its ability

to communicate with M ontana voters.

The district cou rt granted summary

judgment to the st ate, holding that

although the ba n was content-based,

it was narrowly tailo red to address the

state’s compellin g interest in protect-

ing residential privacy and tranquility.

The political consultant appealed.

The U.S. Co urt of Appeals for the

Ninth Circuit hel d that Montana’s

robocall statu te was a content-based

regulation bec ause its treatment of

speech was die rent depending on

“the topic discu ssed, viewpoint or idea

24 | SECTION OF LITIGATION

Published in Litigation News Volume 46, Number 3, Spring 20 21. © 2021 by the American Bar A ssociation. Repr oduced with permissi on. All rights reser ved. This informati on or any portion the reof may not be copie d or disseminated in any

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