Last week, in Daniels v. Hollister Co., the New Jersey Appellate Division rejected the notion that the plaintiffs in a damages class action must show that the class is "ascertainable" before it may be certified.
The court responded at length to recent federal-court ascertainability precedent, coming especially from the Third Circuit, requiring the named plaintiffs to come up with a precise method for identifying the class members at the class-certification stage. The Third Circuit has imposed this requirement even in small-claims consumer cases where the defendant's failure to maintain sales records makes it difficult to specify a method for obtaining the class members identities at the front end. This requirement threatens consumer class actions. After all, most consumers don't keep receipts for their small- or medium-cost purchases, so it's hard for consumers to prove that they are class members except through their say-so, a method of proof the Third Circuit rejected in a decision called Carrera (where class members' under-oath claims of class membership were deemed insufficient). (Recently, as we've explained, the Third Circuit itself may be putting on the brakes, although in what circumstances and to what degree remains unclear.)
The entire decision in Daniels is worth a read. In the meantime, take a look at the following passage to get a flavor:
Ascertainability, as defined by defendant, is particularly misguided when applied to a case where any difficulties encountered in identifying class members are a consequence of a defendant's own acts or omissions. Had defendant obtained the identities of consumers when giving out $25 gift cards, the problems it now offers as grounds for upending certification would not exist. Allowing a defendant to escape responsibility for its alleged wrongdoing by dint of its particular recordkeeping policies – an outcome admittedly un-troubling to some federal courts – is not in harmony with the principles governing class actions. See Byrd, supra , 2015 U.S. App. LEXIS 6190 , at *50 (Rendell, J., concurring) (recognizing that "[w]ithout the class action mechanism, corporations selling small-value items for which it is unlikely that consumers would keep receipts are free to engage in false advertising, overcharging, and a variety of other wrongs without consequence"). In the final analysis, "ascertainability" does not benefit the chief goal of our court rules – the fair and efficient administration of justice; the Third Circuit's experiences suggest the doctrine is practically unworkable in application and is being exploited by defendants in unsuitable cases to evade liability. See Hughes v. Kore of Ind. Enter., Inc., 731 F.3d 672 , 677 (7th Cir. 2013) (recognizing that "when what is small is not the aggregate but the individual claim . . . that's the type of case in which class action treatment is most needful[,]" and emphasizing that a class action "has a deterrent as well as a compensatory objective").
HT to Jon Taylor.