Ascertainability is an implied requirement for class certification, not expressly addressed in Fed. R. Civ. P. 23. While there are different formulations of the requirement, in essence it requires that there be an adequate method for ascertaining who the class members (as defined by the class definition) are, without conducting trials for that purpose. Ascertainability of the class is essential for the court to give notice to the class, determine who is bound by a final judgment, etc.
The Third Circuit has been a hotbed of litigation over this requirement following its decisions in Carrera v. Bayer Corp., 727 F.3d 300 (3d Cir. 2013) and Marcus v. BMW of North America, LLC, 687 F.3d 583 (3d Cir. 2012). Some commentators have suggested that the Third Circuit’s standard is so stringent that it completely precludes certification of any class involving a small consumer product for which consumers rarely retain a receipt or other proof of purchase. The Third Circuit recently clarified its standard.
In Byrd v. Aaron’s Inc., No. 14-3050, 2015 U.S. App. LEXIS 6190 (3d Cir. Apr. 16, 2015), the plaintiffs rented computers from the defendants, which allegedly used spyware to secretly record screenshots, keystrokes and webcam images, without the renters having any idea that their activities were being recorded. All kinds of personal information was allegedly recorded, in a scenario reminiscent of George Orwell’s book 1984, as the court noted. The plaintiffs alleged that this violated the Electronic Communications Privacy Act of 1986.
The district court denied class certification on ascertainability grounds. It found the proposed class underinclusive, overly broad, and vague to the extent it included “household members” of those who rented computers.
The Third Circuit reversed, finding that ascertainability was satisfied, and remanded for further consideration of the other class certification requirements. Here are some key points from the opinion:
- Ascertainability requires that “(1) the class is ‘defined with reference to objective criteria’; and (2) there is ‘a reliable and administratively feasible mechanism for determining whether putative class members fall within the class definition.” Id. at *15. “If class members are impossible to identify without extensive and individualized fact-finding or ‘mini-trials,’ then a class action is appropriate.” Id. at *16.
- The class members need not be actually identified at the class certification stage, but there must be a sufficient evidentiary showing demonstrating that class members can be identified. Id. at *18.
- Although ascertainability is related to the class definition, it is a separate requirement from the requirement that the class be adequately defined for purposes of a class certification order, and the two requirements should not be conflated. Id. at *22-23.
- There is no requirement that a class include everyone who was harmed because that might require a fail-safe class, and “[i]ndividuals who are injured by a defendant but are excluded from a class are simply not bound by the outcome of that particular litigation.” Id. at *25-26.
- Potential overbreadth of the class is an issue that should be addressed separately from ascertainability. A class that is defined broadly but can be readily identified through objective records is ascertainable. Whether members of the putative class lack standing is a separate issue that the court declined to address before the district court had done so. Id. at *29-31.
- The inclusion of “household members” of persons who rented computers in the definition of the class did not render the class not ascertainable. Public records could be used to identify persons who resided in the same house or apartment as the renter. Id. at *31-32.
Judge Rendell issued a concurring opinion, explaining that she would eliminate the second prong of the Third Circuit’s ascertainability test. She would not require that there be an “administratively feasible” mechanism for determining who the class members are because, in her view, this requirement eliminates too many “small-value” consumer class actions. Id. at *51-54 (Rendell, J., dissenting).
While this decision likely will be viewed as an effort by the court to narrow, to some degree, the Third Circuit’s defendant-friendly ascertainability standard, ascertainability remains a key basis on which defendants will be able to defeat class certification in many cases. One way to develop an evidentiary record for this is to find examples of potential putative class members with respect to whom a mini-trial would be required to determine whether or not they fall within the class. To the extent you can show that these mini-trials would be required in a substantial number of cases, that makes the defendant’s argument even stronger.
In insurance claim-related class actions, the proposed class is frequently defined in a manner in which an individual claim file review would be required to identify class members, and even that review would not squarely answer the question of class membership in many instances because the file does not clearly answer the relevant questions, and may contain incorrect information. Ascertainability can be a key ground on which to defend against class certification in insurance cases.