MEMORANDUM DECISION AND ORDER

ROBERT J. SHELBY, United States District Judge.

Plaintiffs Charles Roberts and Kenneth McKay bring this class action on behalf of themselves and other truck drivers. They assert claims against two affiliated trucking companies, C.R. England, Inc. and Opportunity Leasing, Inc. Plaintiffs claim Defendants fraudulently induced thousands of individuals to enroll in C.R. England's driver training schools, then fed students misinformation to convince them to lease trucks and become independent contractor lease operators.

On January 31, 2017, the court certified a nationwide class of independent contractor lease operators who meet certain qualifications, for claims of fraud, negligent misrepresentation, breach of fiduciary duty, and unjust enrichment, and for claimed violations of the Utah Consumer Sales Practices Act (UCSPA), Utah Business Opportunity Disclosure Act (UBODA), and Utah Truth in Advertising Act (UTIAA).1 The class was certified under Rule 23(b)(3) of the Federal Rules of Civil Procedure.2

On April 26, 2017, Defendants filed a Motion to Alter or Amend [the] Class Certification Order.3 In their Motion, Defendants initially sought several amendments to the Class Certification Order;4 however, they later agreed to defer all but one of the issues raised: whether Plaintiffs' claims are subject to a mandatory opt-in notice requirement under Utah law.5 Defendants also moved to certify a number of questions to the Utah Supreme Court.6 The court now takes up these two issues.

I. Notice Requirement

Under the UCSPA, class action claims are subject to an opt-in notice requirement. Defendants argue this requirement applies not only to Plaintiffs' UCSPA claims, but to all of Plaintiffs' claims under Utah statutory and common law. However, Rule 23 of the Federal Rules of Civil Procedure calls for opt-out notice in federal class action claims. As a federal court sitting in diversity jurisdiction, the court must determine whether Federal Rule 23 or the opt-in provision of the UCSPA controls.

A. Shady Grove

A Supreme Court decision, Shady Grove Orthopedic Associates, P.A. v. Allstate Insurance Company, provides the controlling authority for determining whether Federal Rule 23 or the UCSPA opt-in requirement applies in this case.7 In Shady Grove, the Court addressed a conflict between Rule 23 and a New York statute prohibiting class action suits to recover statutory penalties, including statutory interest.8 The plaintiff brought a putative class action in federal court under a separate state law providing for statutory interest. The issue was whether New York's prohibition on class action suits for penalties or Federal Rule 23 (which would allow the suit) controlled.

Five justices held that Rule 23, not the state law restriction, applied.9 The decision was fragmented; Justice Scalia wrote for the plurality, Justice Stevens joined in the holding but concurred separately, and four justices dissented.10 In light of this split, the Tenth Circuit instructs that Justice Stevens's concurrence is controlling.11 Because Justice Stevens joined in Sections I and II-A of the plurality opinion, those parts also control.12

Shady Grove reiterates the "familiar" two-step framework that applies when a federal rule and a state law both seemingly govern.13 First, courts determine whether the federal rule directly conflicts with the state law.14 A direct conflict between a federal rule and state law exists if the federal rule "answers the question in dispute,"15 or put differently, if it is "sufficiently broad to control the issue before the Court."16

If there is a direct conflict, the federal rule applies as long as it represents a valid exercise of Congress's rulemaking authority under the Rules Enabling Act (REA).17 A federal rule runs afoul of the REA if it "abridge[s], enlarge[s], or modif[ies] any substantive right."18

Justice Scalia, writing for the plurality in Shady Grove, read this REA limitation to require only that a federal rule "really regulate procedure."19 This approach places the focus on the nature of the federal rule, not the conflicting state law. If the federal rule "governs only the manner and the means by which the litigants' rights are enforced, it is valid; if it alters the rules of decision by which [the] court will adjudicate [those] rights, it is not."20 Applying that test, Justice Scalia likened Rule 23 to traditional joinder rules, finding it procedural in nature and therefore valid under the REA.21

Justice Stevens concurred in the result but advanced a different approach. Under his reading of the REA, a federal rule is invalid if its application in a case would effectively abridge, enlarge, or modify a state-created right or remedy.22 Unlike the plurality, Justice Stevens's approach focuses on the nature of the competing state law. The form of the state law, whether traditionally substantive or procedural, is not dispositive; rather, the question is whether the law "function[s] as part of the State's definition of substantive rights and remedies."23 Federalism concerns appear to animate Justice Stevens's view.24 Thus, a state might choose to employ a "traditionally procedural vehicle as a means of defining the scope of substantive rights or remedies, [and] federal courts must recognize and respect that choice."25

Even while narrowing the scope of instances in which a federal rule preempts state law, however, Justice Stevens cautioned that the bar for finding an REA violation is still "a high one." There must be "little doubt" that application of the federal rule would alter a state-created substantive right.26 Almost all state laws have the potential to alter litigation outcomes, but only those "intimately bound up in the scope of a substantive right or remedy" can displace federal rules.27

Based on his "plain textual reading" of the statute before the Court, Justice Stevens concluded that New York's prohibition on class actions for statutory penalties did not clear this high bar. The law reflected "a policy judgment about which lawsuits should proceed in New York courts in a class form," not a rule "intimately bound up in the scope of a substantive right or remedy."28

At least in the Tenth Circuit, where Justice Stevens's concurring opinion controls, the correct analysis when a federal rule and a state law both seemingly apply is this: first, the court determines whether there is a direct conflict between the two provisions. If so, the federal rule controls unless its application would violate the REA by altering a state-created substantive right. This inquiry looks not to the form of the state law, but to its plain language to determine whether it operates to "define[] the dimensions of a claim itself."29 Applying this framework to the case at hand, Rule 23 applies to Plaintiffs' UCSPA claim and requires opt-out notice.

B. Application of Shady Grove's Two-Step Analysis

Returning to the instant case, at step one, Rule 23 and the UCSPA are in direct conflict.30 Rule 23 squarely "answers the question in dispute" by categorically imposing opt-out notice.31 The UCSPA, on the other hand, requires opt-in notice — Section 13-11-20(4) states that class notice must advise members that "the court will exclude [them] from the class, unless [they] request[] inclusion, by a specified date."32 The two requirements flatly contradict each other.33

The analysis at step two is more nuanced. Under Justice Stevens's controlling Shady Grove concurrence, Rule 23's opt-out provision applies to Plaintiffs' claims unless the UCSPA opt-in provision "function[s] as part of [Utah's] definition of substantive rights and remedies."34

By requiring potential class members to affirmatively opt in to a class action brought under the UCSPA, Section 13-11-20(4) is likely to limit class size. But while the opt-in notice requirement may affect litigation outcomes, that does not mean it "defines the dimensions of [the] claim itself."35 Rather, the provision reflects Utah's "classical procedural calibration of making it easier to litigate [UCSPA class action] claims ... only when it is it necessary to do so, and not making it too easy when the class tool is not required."36 The UCSPA establishes substantive consumer rights and corresponding remedies, but a potential UCSPA class member's entitlement to those rights do not change based on whether the process for joining a suit entails opt-in or opt-out notice of the proceeding.

As in Shady Grove, the UCSPA's legislative history does not compel a different result. When evaluating legislative history in this context, Justice Stevens distinguished between "procedural rules adopted for some policy reason and seemingly procedural rules that are intimately bound up in the scope of a substantive right or remedy."37 Legislative history is only helpful to the degree it "clearly describe[s] a judgment" that the law would operate to define the scope of substantive rights.38

Defendants highlight two statements made by legislators in 1973, indicating the UCSPA opt-in provision was to be a "major change in the concept of class action lawsuits,"39 the effect of which would be to "limit the membership of the class to those who request [inclusion]."40 Defendants also point out that the Utah Legislature modified the model act on which the UCSPA is based to specifically provide for opt-in notice.41 While this legislative history shows that Utah adopted the opt-in provision deliberately "for some policy reason" (i.e. to limit class membership), it does not "clearly describe a judgment" that the opt-in requirement is "intimately bound up" in the substantive rights and remedies provided by the UCSPA.

Of course, this case differs from Shady Grove in several ways. First, the two state law provisions are substantively distinct. The New York statute in Shady Grove prohibited class action suits for statutory penalties. The provision at issue here, in contrast, requires a plaintiff affirmatively request inclusion in order enforce her USCPA-created rights in a class action suit. The impact of the New York law touches more directly on a potential plaintiff's substantive rights than does an opt-in requirement. The former operates as a complete bar to class action certification, whereas the opt-in provision is better characterized as a hurdle — a change in the process class members must follow in order to join in the suit.42 Even with Justice Stevens's federalism concerns in mind, it is difficult to see how the UCSPA opt-in requirement could function to define Utah's substantive rights or remedies if New York's prohibition did not.

Two other distinctions weigh in the opposite direction. First, the New York statute was one of general application found in the state procedural code, whereas the opt-in provision here is found within the text of the USCPA itself. Second, the New York statute "expressly and unambiguously" applied to claims brought under federal law or the laws of other states.43 Justice Stevens thus found it "hard to see how [the law] could be understood as a rule that, though procedural in form, serves the function of defining New York's rights or remedies."44 Here, the opt-in provision on its face may apply only to class actions brought under the UCSPA.

But neither distinction compels a different result than that reached in Shady Grove. The location of a law within state statutory codes can be useful in discerning the legislature's intent, but cannot in itself prove the law's procedural or substantive nature.45 Instead, whether a law is "intimately bound up in the scope of a substantive right or remedy"46 is a legal question. In this case, the UCSPA opt-in provision is not bound up in a substantive right or remedy.47

To the second point, the fact that the UCSPA opt-in provision does not "expressly and unambiguously" apply to claims under federal law and the laws of other states is not determinative. As an initial matter, it is not clear whether the opt-in provision applies only to claims under the UCSPA or extends more broadly to all related claims regardless of their source of law.48 If it applies broadly, that would support the conclusion that it does not function to define Utah's rights or remedies, for the reasons explained by Justice Stevens in Shady Grove.49 However, even if the UCSPA is construed more narrowly to impose opt-in notice only for related claims under state law, that still falls well short of leaving "little doubt" that the requirement serves the function of defining Utah's substantive rights or remedies.

Two other district courts addressed similar conflicts and reached the opposite conclusion, finding application of Rule 23 over a state law opt-in provision would violate the REA.50 To distinguish those cases from Shady Grove, the courts in Driscoll and Harris relied heavily on the fact that the opt-in requirements in those cases, like here, were located within the text of the statutes creating the underlying rights of action.51 For the reasons discussed above, and considering Justice Stevens's merely passing mention of the New York statute's location in the state code,52 the significant weight placed on this single factor appears misplaced. More to the point, those cases contain relatively limited analyses under what this court construes as a relatively complex Shady Grove decision.

Under Shady Grove, Plaintiffs' UCSPA claims are subject to an opt-out notice requirement under Rule 23. Therefore, Defendants' Motion to Alter or Amend [the] Class Certification Order is DENIED in part as to the notice required for Plaintiffs' UCSPA claims.

C. Plaintiffs' Non-UCSPA Claims

Defendants also seek to impose an opt-in requirement to Plaintiffs' other statutory and common law claims. Section 13-11-23 of the UCSPA states: "the remedies of this act are in addition to remedies otherwise available for the same conduct under state or local law, except that a class action relating to a transaction governed by this act may be brought only as prescribed by this act."53 Defendants argue that this provision operates to extend the UCSPA's opt-in requirement to all of Plaintiffs' claims. However, because Rule 23 governs Plaintiffs' UCSPA claims, displacing the UCSPA opt-in provision, there is no basis to extend the opt-in provision to other claims. Defendants' Motion to Alter or Amend [the] Class Certification Order is DENIED in part as to the notice required for Plaintiffs' claims under the UBODA and UTIAA, and for fraud, negligent misrepresentation, breach of fiduciary duty, and unjust enrichment.

II. Certification of Questions to the Utah Supreme Court

Defendants move to certify the following four questions to the Utah Supreme Court:

Utah Rule of Appellate Procedure 41(a) provides an avenue for federal courts to certify a question to the Utah Supreme Court when "the state of the law of Utah applicable to a proceeding before the certifying court is uncertain."55 However, "certification is not to be routinely invoked" each time a federal court is faced with new or unsettled questions of state law.56 Instead, the court is to exercise "judgment and restraint" before certifying questions, particularly when a "reasonably clear and principled course" presents itself.57

While there is some uncertainty involved in each of Defendants' proposed questions, restraint is appropriate in this case. Defendants' second question relating to the notice provision of the USCPA is discussed at length above. In conducting its analysis, the court found sufficient guidance and authority to decide this question under controlling federal authority. The parties fully briefed the issues, presented oral argument, and provided ample authority with which to conduct a thorough analysis. The court has not yet reached Defendants' first question relating to the statutory damages provision of the UCSPA, but is confident it will be similarly guided if or when it reaches that issue.58

The court also declines to certify Defendants' third and fourth questions, concerning construction of the UBODA. These issues were addressed when Defendants' Motion for Partial Summary Judgment on Plaintiffs' UBODA claim was denied.59 Requests for certification are "disapproved ... when the district court has already ruled."60 In deciding whether to certify a question, the court must consider "whether certification will conserve the time, energy, and resources of the parties as well as of the court itself."61 When a party requests certification after a ruling, as is the case here, the time and resources already expended resolving the matter counsel against certification. Given the prior ruling and the amount of time passed since Plaintiffs' class was certified, the certification of these questions is not warranted.

CONCLUSION

For the foregoing reasons, Defendants' Motion to Alter or Amend [the] Class Certification Order62 is DENIED in part as to the opt-in notice provision with prejudice, and DENIED in part as to the remainder of the issues without prejudice.

Defendants' Motion to Certify Questions to the Utah Supreme Court63 is DENIED.

SO ORDERED this 21st day of March, 2018.