Wolph et al v. ACER America Corporation

Filing 154

ORDER ON MOTION FOR RECONSIDERATION. Case Management Statement due by 4/20/2012. Further Case Management Conference set for 4/27/2012 01:30 PM in Courtroom 11, 19th Floor, San Francisco. Signed by Judge JEFFREY S. WHITE on 3/23/12(jjoS, COURT STAFF) (Filed on 3/23/2012)

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1 2 3 4 5 IN THE UNITED STATES DISTRICT COURT 6 FOR THE NORTHERN DISTRICT OF CALIFORNIA 7 8 LORA and CLAY WOLPH, on behalf of themselves and all others similarly situated, 9 No. C 09-01314 JSW Plaintiffs, 10 ORDER ON MOTION FOR RECONSIDERATION ACER AMERICA CORPORATION, For the Northern District of California United States District Court v. 11 12 Defendant. 13 / 14 15 Now before the Court is the motion for reconsideration filed by defendant Acer America 16 Corporation (“Acer”). This motion is fully briefed and is ripe for decision. Pursuant to Civil 17 Local Rule 7-1(b), the Court finds that this matter is appropriate for decision without oral 18 argument and is deemed submitted. See N.D. Civ. L.R. 7-1(b). Accordingly, the hearing set for 19 March 30, 2012 is HEREBY VACATED. Having carefully reviewed the parties’ papers and 20 considering their arguments and the relevant authority, and good cause appearing, the Court 21 hereby denies Acer’s motion. 22 23 ANALYSIS Acer is moving for reconsideration on the following two grounds: (1) the Court should 24 reconsider its ruling regarding whether the proposed class is ascertainable in light of the 25 Supreme Court’s ruling in Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541 (2011); and (2) the 26 Court should reconsider its ruling on predominance because the Court relied on arguments 27 made by Plaintiffs Lora and Clay Wolph (“Plaintiffs”) for the first time in their reply brief. The 28 Court will address each of Acer’s grounds in turn. 1 2 A. Ascertainable. A party seeking class certification must demonstrate that an identifiable and “‘Although there is no explicit requirement concerning the class definition in FRCP 23, courts 5 have held that the class must be adequately defined and clearly ascertainable before a class 6 action may proceed.’” Schwartz v. Upper Deck Co., 183 F.R.D. 672, 679-80 (S.D. Cal. 1999) 7 (quoting Elliott v ITT Corp, 150 F.R.D. 569, 573-74 (N.D. Ill. 1992)). “A class definition 8 should be ‘precise, objective and presently ascertainable.’” Rodriguez v. Gates, 2002 WL 9 1162675 at *8 (C.D. Cal. 2002) (quoting O’Connor v. Boeing North American, Inc., 184 F.R.D. 10 311, 319 (C.D. Cal. 1998)); see also Manual for Complex Litigation, Fourth § 21.222 at 270-71 11 For the Northern District of California ascertainable class exists. Mazur v. eBay Inc., 257 F.R.D. 563, 567 (N.D. Cal. 2009). 4 United States District Court 3 (2004). The class definition must be sufficiently definite so that it is administratively feasible to 12 determine whether a particular person is a class member. See, e.g., Davoll v. Webb, 160 F.R.D. 13 142, 144 (D. Colo. 1995); Pryor v. Aerotek Scientific, LLC, --- F.R.D.---, 2011 WL 6376703, *5 14 (C.D. Cal. Nov. 15, 2011) (quoting O'Connor, 184 F.R.D. at 319) (“A class is sufficiently 15 defined and ascertainable if it is ‘administratively feasible for the court to determine whether a 16 particular individual is a member.’”). 17 Acer argues that, in light of Wal-Mart Stores, 131 S.Ct. 2541, Plaintiffs should be 18 required to demonstrate, on the merits, that Acer’s notebooks were defective. The Court 19 disagrees. In ruling on Plaintiffs’ motion for class certification, the Court did note that 20 Plaintiffs presented sufficient evidence at that procedural stage to show the plausibility of their 21 claim that Acer’s notebooks containing 1 GB or less of RAM do not have sufficient memory to 22 operate Vista Premium and are therefore defective. However, this finding was not essential to 23 the Court’s conclusion that the class is ascertainable. 24 As stated above, a class is sufficiently defined and ascertainable if it is administratively 25 feasible for the court to determine whether a particular individual is a member. See Davoll, 26 160 F.R.D. 142 at 144; Pryor, 2011 WL 6376703 at *5. Here, the class is defined as: 27 28 All persons and entities who reside in the United States who have purchased, and have not returned for refund, a new Acer notebook computer from Acer or an Acer Authorized Reseller, not for resale, that came pre-installed with a Microsoft® Windows Vista Home 2 1 2 Premium, Business, or Ultimate operating system, and contained 1GB of Random Access Memory or less as shared memory for both the system and graphics. 3 From this definition, it is administratively feasible to determine whether a particular individual 4 is a member of the class. The parameters for membership in the class are set by objective 5 criteria. See Pryor, 2011 WL 6376703, * 5 (finding class ascertainable where the parameters 6 for membership in the class were objective criteria and members were ascertainable through 7 business records); see also Hofstetter v. Chase Home Finance, LLC, 2011 WL 1225900, *14 8 (N.D. Cal. March 31, 2011) (same). An individual is a member of the class if he or she 9 purchased the notebook at issue and did not return it. Acer does not dispute that the identity and contact information for a significant portion of theses individuals can be obtained from the 11 For the Northern District of California United States District Court 10 warranty registration information and through Acer’s customer service databases. Accordingly, 12 the Court finds that the holding in Wal-Mart Stores does not alter the Court’s finding that the 13 class is ascertainable and, thus, denies Acer’s motion for reconsideration on this ground. 14 B. Predominance. 15 Upon consideration of the authorities cited by Acer and by Plaintiffs, the Court finds 16 that reconsideration of the issue of predominance is not required. Acer argues that, based on 17 Poulos v. Caesars World, Inc., 379 F.3d 654, 666 (9th Cir. 2004), there may be no presumption 18 of reliance. Accordingly, accordingly to Acer, Plaintiffs must individually prove reliance for 19 every class member, and thus, individual issues predominate. However, the Ninth Circuit has 20 recently ruled to the contrary. See Stearns v. Ticketmaster Corp., 655 F.3d 1013 (9th Cir. 21 2011). 22 “[T]o state a claim under either [California’s Unfair Competition Law (“UCL”)] or the 23 false advertising law, based on false advertising or promotional practices, it is necessary only to 24 show that members of the public are likely to be deceived.” Id. at 1020 (quoting In re Tobacco 25 II Cases, 46 Cal. 4th 298, 312 (2009)). In contrast to common law fraud claims, the UCL 26 focuses “on the defendant’s conduct, rather than the plaintiff’s damages, in service of the 27 statute’s larger purpose of protecting the general public against unscrupulous business 28 practices.” Id. (quoting Tobacco II, 46 Cal. 4th at 312). Therefore, “relief under the UCL is 3 1 available without individualized proof of deception, reliance, and injury.” Id. (quoting Tobacco 2 II, 46 Cal. 4th at 320). Based on the holding in Tobacco II, the Ninth Circuit held that the 3 district court erred in finding that individual issues on reliance and causation predominated. Id.1 With respect to Plaintiffs’ Consumer Legal Remedies Act (“CLRA”) claim, the Ninth 4 establish causation/reliance as a common issue by inference.” Johnson v. General Mills, Inc., 7 276 F.R.D. 519, 522 (C.D. Cal. 2011) (citing Stearns, 655 F.3d at 1022.) As the Stearns court 8 explained, “[c]ausation, on a classwide basis, may be established by materiality. If the trial 9 court finds that material misrepresentations have been made to the entire class, an inference of 10 reliance arises as to the class.” Stearns, 655 F.3d at 1022 (quoting In re Vioxx Class Cases, 180 11 For the Northern District of California Circuit explicitly recognized in Stearns that “California law permits a court to try, and a class to 6 United States District Court 5 Cal. App. 4th 116, 129 (2009)) (emphasis in original). Materiality “is determined from the 12 perspective of the reasonable consumer.” Keilholtz v. Lennox Hearth Products Inc., 268 F.R.D. 13 330, 343 (N.D. Cal. 2011) (citing Falk v. Gen. Motors Corp., 496 F. Supp. 2d 1088, 1094 (N.D. 14 Cal. 2007)); see also Stearns, 655 F.3d at 1022. Here, the Court found that Plaintiffs’ claims 15 are premised on misrepresentations that were made to the entire class. Therefore, common 16 issues predominate on Plaintiffs’ CLRA claim. Despite the Ninth Circuit’s opinion in Stearns, Acer contends that Poulos v. Caesars 17 18 World, Inc., 379 F.3d 654 (9th Cir. 2004), holding that an inference of reliance is not 19 permissible when an action is primarily premised on affirmative misrepresentations, is 20 controlling. However, as the court noted in Johnson, “Poulos is inapplicable here because it is 21 based on a different statutory and common law scheme.” Johnson, 276 F.R.D. at 522. In 22 Poulos, the court determined that no inference of reliance could be drawn in a RICO class 23 action. Id., 379 F.3d at 666. Moreover, even if the rule in Poulos could be extended to class 24 actions beyond RICO, “an expansion into CLRA claims is clearly contradictory to the Ninth 25 26 27 28 The court clarified that predominance might not be shown in every UCL class action: “For example, it might well be that there was no cohesion among the members because they were exposed to quite disparate information from various representatives of the defendant.” Stearns, 655 F.3d at 1020. However, that was not the case in Stearns and, thus, the district court erred in denying class certification. Id. Similarly, here, this is not a case where the class was exposed to disparate representations by varying sources. 1 4 1 Circuit’s assertions in [Stearns], decided after Poulos.” Johnson, 276 F.R.D. at 522. The Ninth 2 Circuit in Stearns, “explicitly recognized that a classwide inference of reliance for both 3 affirmative misrepresentations and omissions is proper for a CLRA claim.” Id. Accordingly, 4 the Court finds that reconsideration is not warranted here. 5 CONCLUSION 6 For the reasons set forth above, the Court DENIES Acer’s motion for reconsideration. 7 The Court HEREBY SETS a further case management conference in the case for April 27, 2012 8 at 1:30 p.m. The parties shall file a joint case management statement by no later than April 20, 9 2012. IT IS SO ORDERED. 11 For the Northern District of California United States District Court 10 12 Dated: March 23, 2012 JEFFREY S. WHITE UNITED STATES DISTRICT JUDGE 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5

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