BLEASE, Acting P. J. —
Plaintiff Dione Aguirre appeals from an order denying class certification. Plaintiff sued defendants Amscan Holdings, Inc., and PA Acquisition, doing business as Party America (collectively Party America), on behalf of herself and similarly situated individuals, alleging Party America violated Civil Code
Plaintiff filed her original complaint on June 2, 2008, and the operative first amended complaint on June 9, 2008. The first amended complaint alleges that Party America's practice of requesting and recording personal identification information, namely ZIP Codes, from its credit card customers at the point-of-sale violated section 1747.08, which prohibits persons and businesses from requesting or requiring "personal identification information" as a condition to accepting a credit card as payment for goods or services.
As to plaintiff, the first amended complaint alleges that within 12 months of bringing this action, plaintiff purchased an item from the Party America store in Placer County using a credit card. During the transaction, the cashier requested plaintiff's ZIP Code, which plaintiff provided, believing she was required to do so to complete the transaction. The cashier then entered plaintiff's ZIP Code into an electronic cash register.
As to the class, the first amended complaint alleges that the "lawsuit is brought on behalf of an ascertainable statewide class consisting of all persons in California from whom [Party America] requested and recorded personal identification information in conjunction with a credit card transaction ...."
In May 2010, Party America filed a motion for judgment on the pleadings on the sole ground that a cardholder's ZIP Code does not constitute "personal identification information" within the meaning of section 1747.08. The trial court granted the motion, plaintiff appealed, and we reversed, citing our Supreme Court's then recent decision in Pineda v. Williams-Sonoma Stores,
On or about September 25, 2012, Party America moved for an order striking and dismissing the class allegations from plaintiff's operative complaint (Cal. Rules of Court, rule 3.767(a)(3)) and denying class certification (id., rule 3.764(a)) on the grounds "there is no ascertainable class," and class certification is not the superior method for adjudication of this matter. Specifically, Party America argued that the class definition was vague and overbroad as to the class period and type of credit card transaction covered making it difficult for persons hearing it to determine who is in the class and who would be bound by any judgment, "there is no means for identifying or locating potential members of the class, or any customers, so as to notify them of this action," and class treatment is inappropriate because it would expose Party America to damages that far exceed any damage to the class.
In support of its motion, Party America tendered as evidence the parties' responses to discovery. Such evidence indicated that from approximately November 2005 through October 13, 2010, it was Party America's practice to ask all of its customers for their ZIP Codes at the point-of-sale, regardless of the method of payment. A ZIP Code prompt would appear on the register screen, and employees were instructed, pursuant to a written "ZIP Code Survey" policy, to ask the customer for his or her ZIP Code, and to enter it accurately. In the event a customer refused to provide his or her ZIP Code, employees were instructed to enter "99999." Employees were admonished that "[e]ntering in false zip codes or not asking ... will not be tolerated," and "[a]nyone that does not enter in the accurate information will be subject to disciplinary action, up to and including termination." The purpose of Party America's ZIP Code Survey policy was to determine new store locations and for media placement purposes. Party America recorded the customer's ZIP Code, along with the corresponding purchase amount.
There were approximately 1 million credit card transactions at Party America's California retail stores from June 2007 through October 13, 2010. Party America did not monitor the number of unique credit card transactions in its stores; thus, the 1 million figure necessarily includes transactions made by repeat customers.
Plaintiff opposed the motion. She presented the following revised class definition in response to Party America's assertion that the class definition set forth in the first amended complaint was vague and overbroad: "All persons in California from whom Defendant requested and recorded a ZIP code in conjunction with a credit card purchase transaction from June 2, 2007 through October 13, 2010 (the `Class'). [¶] The following persons are excluded from the Class: (i) persons who utilized a credit card issued for business purposes; (ii) persons whose personal identification information was required for a special purpose incidental but related to the individual credit card transaction, including but not limited to information related to shipping, delivery, servicing, or installation of the purchased merchandise, or for special orders; (iii) officers and directors of Defendant and of its corporate parents, subsidiaries, affiliates or any entity in which [Defendant] has a controlling interest, and the legal representative, successors, or assigns of any such excluded persons or entities; and (iv) the Court." The parties agreed that plaintiff could oppose Party America's motion on the basis of the revised definition.
In addition, plaintiff disputed Party America's claim that she must establish a means for identifying or locating potential members of the class so as to notify them of the action, arguing that any such requirement "improperly conflated ascertainability, class member identification, and notice into a single requirement ...." She asserted that the revised class definition satisfied the ascertainability requirement because "[a]ny individual who looks at that class definition will know whether or not they're in that class and can confirm through objective evidence that they are, in fact, a member of that class." As for Party America's argument that there is no objective evidence that would indicate class membership, plaintiff pointed to credit card statements and sales receipts. According to plaintiff, potential class members have the ability to present a receipt or credit card statement showing a credit card transaction was entered into on a specific date, at a specific store location, and the specific amount of the purchase. That document "could [then] be cross-referenced with the records of defendant to show the specific purchase amount, show a ZIP Code was requested associated with that specific purchase amount and the transaction records." Finally, plaintiff argued that proceeding as a class action is the superior form of adjudication and that the size of Party America's potential liability should not be considered.
The trial court agreed with Party America that plaintiff failed to establish the existence of an ascertainable class, and thus, granted the motion to strike and dismiss the class allegations and to deny class certification. According to the trial court, "A class is ascertainable when (1) the members of the class are clearly identifiable and the size of the class is reasonably controlled; and (2) the members can be located and notified of the action through reasonable expenditure of time and money. (Reyes v. Board of Supervisors (1987) 196 Cal.App.3d 1263, 1274-1275 [242 Cal.Rptr. 339].)" The court also noted that it "is not aware of any authority that allows speculative advertising to establish an ascertainable class or that allows purported class members to self-identify without first establishing an ascertainable class."
In concluding plaintiff failed to establish the existence of an ascertainable class, the trial court reasoned: "Defendants' discovery responses state they did not retain customers' names and that they cannot identify customers from whom they obtained zip codes during credit card transactions. Plaintiff has not challenged those discovery responses. In fact, plaintiff's own discovery responses acknowledge that she is not aware of the identity of any other member of the purported class and that she does not know how many people are in the purported class. Under these circumstances, any type of notice would necessarily be both over-inclusive (it would be distributed to individuals who never shopped at defendants' stores) and under-inclusive (there is no certainty the notice would reach all individuals who might have a claim). [¶] Furthermore, discovery has been ongoing for months, and at the initial hearing on this motion ..., the parties agreed that additional discovery was not contemplated and would not assist the court in deciding this motion. In
The trial court did not address the parties' arguments as to whether a class action was a superior means of proceeding.
Plaintiff contends that the trial court erred in concluding that she failed to establish an ascertainable class because "each individual class member was not specifically identifiable from [Party America's] records, and thus, notice... cannot be directly provided to class members." We agree.
Courts have assumed without specifically deciding that section 1747.08 authorizes class actions. (See, e.g., Archer v. United Rentals, Inc. (2011) 195 Cal.App.4th 807, 828-830 [126 Cal.Rptr.3d 118]; The TJX Companies, Inc. v. Superior Court (2008) 163 Cal.App.4th 80, 84-89 [77 Cal.Rptr.3d 114]; Korn v. Polo Ralph Lauren Corp. (E.D.Cal. 2008) 644 F.Supp.2d 1212, 1215-1216; Yeoman v. Ikea U.S. West, Inc. (S.D.Cal., May 4, 2012, No. 11cv701 WQH (BGS)) 2012 U.S.Dist. Lexis 63888.)
"Because trial courts are ideally situated to evaluate the efficiencies and practicalities of permitting group action, they are afforded great discretion in granting or denying certification. The denial of certification to an entire class is an appealable order [citations], but in the absence of other error, a trial court ruling supported by substantial evidence generally will not be disturbed `unless (1) improper criteria were used [citation]; or (2) erroneous legal assumptions were made [citation]' [citation]. Under this standard, an order based upon improper criteria or incorrect assumptions calls for reversal `"even though there may be substantial evidence to support the court's order."' [Citations.] Accordingly, we must examine the trial court's reasons for denying class certification. `Any valid pertinent reason stated will be sufficient to uphold the order.' [Citation.]" (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435-436 [97 Cal.Rptr.2d 179, 2 P.3d 27] (Linder).)
Contrary to the trial court's order, the representative plaintiff need not identify, much less locate, individual class members to establish the existence of an ascertainable class. (Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695, 706 [63 Cal.Rptr. 724, 433 P.2d 732] (Daar); Reyes, supra, 196 Cal.App.3d at p. 1274 ["it is firmly established a plaintiff is not required at this stage of the proceedings to establish the existence and identity of class members"]; see Astiana v. Kashi Co. (S.D.Cal. 2013) 291 F.R.D. 493, 500 ["If class actions could be defeated because membership was difficult to ascertain at the class certification stage, `there would be no such thing as a consumer class action.'"].) Nor must the representative plaintiff establish a means for providing personal notice of the action to individual class members. (See Evans v. Lasco Bathware, Inc. (2009) 178 Cal.App.4th 1417, 1422 [101 Cal.Rptr.3d 354] ["A proponent at the class certification stage is not required to ... identify a form of notice to obtain class certification."].) Indeed, such a requirement would conflict with the liberal notice provisions contained in California Rules of Court, rule 3.766(f), which "is designed to dispense under certain circumstances with actual personal notice." (Haro v. City of Rosemead (2009) 174 Cal.App.4th 1067, 1076 [94 Cal.Rptr.3d 874].) Rule 3.766(f) states: "If personal notification is unreasonably expensive or the stake of individual class members is insubstantial, or if it appears that all members of the class cannot be notified personally, the court may order a means of notice reasonably calculated to apprise the class members of the pendency of the action-for example, publication in a newspaper or magazine; broadcasting on television, radio, or the Internet; or posting or distribution through a trade or professional association, union, or public interest group." (Italics added.)
Party America does not dispute that the revised class definition is "sufficient to allow a member of that group to identify himself or herself as having a right to recover based on the description" set forth therein. (Bartold, supra, 81 Cal.App.4th at p. 828.) Rather, Party America claims the trial court properly concluded there is no ascertainable class because plaintiff failed to show that there is a means for identifying class members. As a preliminary matter, we reject Party America's assertion that the trial court's determination that there is no ascertainable class was based plaintiff's failure to show that there is a means for identifying class members. As detailed above, the trial court explicitly (and improperly) based its decision on plaintiff's "inability to clearly identify, locate and notify class members through a reasonable expenditure of time and money ...." (Italics added.) Because the trial court applied an erroneous legal standard in reaching its decision, reversal is
In response to Party America's claim that the parties lack an adequate means for identifying class members, plaintiff pointed to sales receipts and credit card statements, noting that potential class members have the ability to present a receipt or credit card statement showing that a credit card transaction was entered into on a specific date, at a specific store location, and the specific amount of the purchase, and that such receipt or credit card statement "could [then] be cross-referenced with the records of defendant to show the specific purchase amount, show a ZIP Code was requested associated with that specific purchase amount and the transaction records."
A similar method for identifying potential class members was approved in Shurland v. Bacci Café & Pizzeria on Ogden, Inc. (N.D.Ill. 2010) 271 F.R.D. 139. There, the defendant argued that the absence of records identifying the class members by name required decertification of the class because the class itself could not be ascertained and identified. (Id. at p. 146.) In addressing the defendant's argument, the district court observed that a "court should deny class certification where there is `simply no reasonable way of identifying potential class members,' but `definiteness does not require plaintiffs to identify specific class members.'" (Ibid.) The court concluded that there was a reasonable way to identify potential class members in that case because "there is a log listing the receipts issued during the period in which [the defendant] was not in compliance with [the fair and accurate credit transactions act's] truncation requirement. The log includes partial credit card information for each transaction, the date it occurred, and the amount of the transaction," which could "be used to verify whether any individual who responds to class notice is in fact a member of the class." (Id. at pp. 146-147, italics added, cited with approval in In re Toys "R" Us — Delaware, Inc. — Fair & Accurate Credit Transactions Act (FACTA) Litigation (C.D.Cal. 2013) 300 F.R.D. 347.) That is essentially what plaintiff proposes here.
Weaver v. Pasadena Tournament of Roses (1948) 32 Cal.2d 833 [198 P.2d 514], cited by Party America, is inapposite. There, the plaintiffs alleged that the defendants advertised the sale of 7,500 tickets to the 1947 Rose Bowl, but closed the box office after only 1,500 tickets were sold, even though the plaintiffs had been given numbered identification stubs assuring them of an opportunity to purchase tickets. (Id. at pp. 835-836.) The plaintiffs sought to represent a class of individuals who had waited in line but were denied tickets to the game. (Id. at p. 838.) Our Supreme Court found that "[t]he causes of action of the several plaintiffs and the other unnamed aggrieved individuals are separate and distinct," and "[t]hus, a decision favorable or adverse to these plaintiffs — or any one of them — could not determine the rights of any of the unnamed parties whom plaintiffs purport to represent." (Ibid.) Accordingly, the court found that "these unknown parties are ascertainable only insofar as each may come forward and individually present proof of all the facts necessary to authorize a recovery in accordance with the merits of his particular case, and judgment in one would by no means be a judgment
Sotelo v. Medianews Group, Inc. (2012) 207 Cal.App.4th 639 [143 Cal.Rptr.3d 293] (Sotelo), also relied on by Party America and the trial court, is factually distinguishable. There, the plaintiff sought to certify a class of persons who worked "`for or on behalf of'" various newspaper companies "`in folding, inserting advertising materials into, bagging, bundling, loading, and/or delivering said newspaper to its residential subscribers, ... and whom no defendant has acknowledged to be its employee in the performance of such work.'" (Id. at p. 645.) The defendants' "records identified approximately 5,000 individuals who had signed a contract with a newspaper. However, because putative class members retained the assistance, with or without a contract, of others who remained unknown to [the defendants], the actual size of the proposed class [was] unknown." (Id. at p. 646.) In affirming the trial court's conclusion that the plaintiff failed to establish an ascertainable class, the Court of Appeal agreed with the trial court's observation that we are not faced with a speculative administrative burden but (as the class is defined) an actual obstacle to identifying persons who contend that they folded and bagged papers during the class period, for one or more defendants: a lack of objective evidence (such as business records) that indicate class membership.'" (Id. at pp. 648-649.) Unlike Sotelo, here, there exists objective evidence indicating class membership, namely sales receipts and/or credit card statements that can be cross-referenced with Party America's records to determine whether the customer's ZIP Code was in fact recorded.
Finally, we find the United States Court of Appeals for the Third Circuit's recent decision in Carrera v. Bayer Corp. (3d Cir. 2013) 727 F.3d 300 (Carrera), forwarded to us by Party America as "new authority," readily distinguishable. In that case, the Third Circuit found that a putative class of purchasers of the defendants' diet supplement was not ascertainable because there was insufficient evidence to show that retailer records could be used to identify class members. (Id. at pp. 308-309.) The court rejected the plaintiff's proposal to use affidavits submitted by putative class members because this process deprived the defendants of the opportunity to challenge class membership. (Id. at p. 309.) Additionally, the court held that "there is a significant likelihood their recovery will be diluted by fraudulent or inaccurate claims," and that absent class members could then argue that they are not bound by a judgment because the named plaintiff did not adequately represent them. (Id. at p. 310.)
As a preliminary matter, Carrera has been roundly criticized by district courts within the Ninth Circuit. "It appears that pursuant to [Carrera] in any case where the consumer does not have a verifiable record of its purchase, such as a receipt, and the manufacturer or seller does not keep a record of buyers, [Carrera] prohibits certification of the class. While [Carrera] may now be the law in the Third Circuit, it is not currently the law in the Ninth Circuit. [Citations.] In this Circuit, it is enough that the class definition describes `a set of common characteristics sufficient to allow' a prospective plaintiff to `identify himself or herself as having a right to recover based on the description.' [Citation.]" (McCrary v. Elations Co., LLC (C.D.Cal., Jan. 13,
The order striking and dismissing the class allegations and denying class certification is reversed, and the matter is remanded to the trial court for consideration of whether class certification is proper given our determination that there exists an ascertainable class. Plaintiff shall recover her costs on appeal. (Cal. Rules of Court, rule 8.278(a)(1), (2).)
Hull, J., and Murray, J., concurred.
