The promise of awarding gift cards is just one method retailers sometimes use to lure shoppers into their stores. For example Hollister Co., a clothing retailer, promised consumers who spent $75 or more a $25 gift card in December 2009. The cards themselves allegedly stated they had “no expiration date”, but the retailer allegedly voided all outstanding cards on January 30, 2010.
Our client, Vincent Daniels, one of the owners of an expired gift card, filed a lawsuit against Hollister for the lost value of the gift card. Because $25 is a negligible amount, Daniels sought to represent an entire class of plaintiffs consisting of everyone still in possession of a gift card, or who threw their gift card away because they were told it had expired. Taken together, the value of all the voided gift cards amounts to more than $3 million.
The judge certified the class and Hollister appealed, saying the judge had incorrectly certified the class. The case went to the appellate division of the Superior Court of New Jersey where three judges reaffirmed the original decision to certify the class.
In arguing against certification, Hollister’s attorneys pointed to some federal court decisions which have denied class certification based on the ability to ascertain all qualifying members of the class action. However, as the appellate court’s decision noted, the “ascertainability” of a class is not one of the necessary qualifications under the Federal Rule of Civil Procedure 23(b)(2).
The Rule requires only that plaintiffs seeking class certification prove numerosity, commonality, typicality, and adequacy of representation. The numerosity requirement means the class must be large enough to justify pursuing the lawsuit as a class action. The commonality requirement means the claims of all the class members must be similar enough to warrant filing them together as one action. In order to satisfy the typicality requirement, the named plaintiff must have a claim or claims sufficiently similar to those of the rest of the class. Finally, “adequacy of representation” means the class representatives and counsel for the plaintiffs must be qualified to represent the best interests of the entire class.
Nowhere does New Jersey’s class action rule say anything about the need to ascertain the eligibility of class members in order to achieve class certification.
Hollister claimed it would have to rely on the word of class members without gift cards that they discarded their gift cards as a result of being told it had expired, rather than for another reason. Also, because Hollister did not keep track of the consumers it gave gift cards to, the corporation claimed the class would be too difficult to ascertain, and therefore was ineligible for class certification.
The court rejected this argument, saying that denying class certification as a result of the defendant’s poor recordkeeping would only act as an incentive for corporations to keep poor records. According to the court, this contradicts the purpose of class actions, which is to grant leverage to parties with small claims, especially when facing off against giant corporations with a significant economic advantage.
As a result, the court upheld the decision by the trial judge to certify the class and rejected using the Third Circuit Court of Appeals ascertainability analysis to deny class certification. The Court reasoned that class actions were designed to protect the little guys and that refusing to certify a class here would prevent bringing consumer class actions for relatively small amounts but which when aggregated could result in multi-million dollar claims.
Our Naperville, Illinois consumer rights private law firm handles individual and class action deceptive advertising, predatory lending, unfair debt collection, lemon law and other consumer fraud cases that government agencies and public interest law firms such as the Illinois Attorney General may not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. The Chicago consumer lawyers at Lubin Austermuehle are proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to consumer fraud and consumer rip-offs, and in the right case filing consumer protection lawsuits and class-actions you too can help ensure that other consumers’ rights are protected from consumer rip-offs and unscrupulous or dishonest practices.
Our Rolling Meadows and Waukegan consumer attorneys provide assistance in fair debt collection, consumer fraud and consumer rights cases including in Illinois and throughout the country. You can click here to see a description of the some of the many individual and class-action consumer cases our Chicago consumer lawyers have handled. A video of our lawsuit which helped ensure more fan friendly security at Wrigley Field can be found here. You can contact one of our Aurora consumer protection attorneys who can assist in consumer fraud, consumer rip-off, lemon law, unfair debt collection, predatory lending, wage claims, unpaid overtime and other consumer, or consumer class action cases by filling out the contact form at the side of this blog or by clicking here. You can also call our toll free number at 630-333-0333.