Yeoman et al v. Ikea U.S.A. West, Inc. et al

Filing 126

ORDER: The Amended Motion to Compel Notice to the Certified Class filed by Plaintiffs (Doc. 95 ) is granted in part and denied in part. Signed by Judge William Q. Hayes on 11/5/2013. (mdc)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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REID YEOMAN and RITA
MEDELLIN, on behalf of themselves
and all others similarly situated
vs.
IKEA U.S. WEST, INC.; DOES 1-50,
inclusive,

Defendants.
HAYES, Judge:
The matter before the Court is the Amended Motion to Compel Notice to the

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ORDER

Plaintiffs,

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CASE NO. 11cv701 WQH
(BGS)

Certified Class filed by Plaintiffs Reid Yeoman and Rita Medellin. (ECF No. 95).
I.

Background
On November 8, 2011, Plaintiffs filed the First Amended Class Action Complaint

(“Complaint”). (ECF No. 25). Plaintiffs allege that they purchased items from an Ikea
store using a credit card, and that, “[d]uring the credit card transaction, the cashier asked
plaintiff[s] for [plaintiffs’] ZIP code.... [B]elieving [plaintiffs were] required to provide
the requested information to complete the transaction, [plaintiffs] provided it.” Id. at
3. Plaintiffs allege that Defendant has a uniform policy of requesting and recording ZIP
codes from customers during credit card transactions, in violation of California’s

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1 Song-Beverly Credit Card Act of 1971.1 Id. at 2.
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On January 13, 2012, Plaintiffs filed a motion for class certification (ECF No.

3 30), which the Court granted on May 4, 2012. (ECF No. 43). The Court certified the
4 following class:
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[A]ll persons from whom Ikea requested and recorded a ZIP Code in
conjunction with a credit card transaction in California from February 16,
2010 through the date of trial in this action (the ‘Class’).
Excluded from the Class are (i) transactions wherein personal information
was required for a special purpose incidental but related to the individual
credit card transaction, including, but not limited to, information relating
to shipping, delivery, servicing, or installation of the purchased
merchandise, or for special orders; and (ii) transactions wherein a credit
card issued to a business was used. Also excluded from the Class are the
officers and directors of Defendant and of its corporate parents,
subsidiaries and affiliates, or any entity in which Defendant has a
controlling interest, and the legal representatives, successors or assigns of
any such excluded persons or entities, and the Court to which the matter
is assigned.

13 Id. at 15.
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On September 7, 2012, Defendant filed a Motion to Decertify the Class pursuant

15 to Federal Rule of Civil Procedure 23(c) (“Motion to Decertify”). (ECF No. 51). On
16 November 1, 2012, Plaintiffs filed a Motion to Compel Notice to the Certified Class
17 (“Motion to Compel Notice”). (ECF No. 74). On February 27, 2013, the Court granted
18 in part and denied in part Defendant’s motion to decertify the class (ECF No. 93), and
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The Song-Beverly Credit Card Act provides:
[N]o person, firm, partnership, association, or corporation
that accepts credit cards for the transaction of business shall do
any of the following: ...
Request, or require as a condition to accepting the credit
card as payment in full or in part for goods or services, the
cardholder to provide personal identification information, which
the person, firm, partnership, association, or corporation accepting
the credit card writes, causes to be written, or otherwise records
upon the credit card transaction form or otherwise....
For purposes of this section ‘personal identification
information,’ means information concerning the cardholder, other
than information set forth on the credit card, and including, but
not limited to, the cardholder's address and telephone number.

Cal. Civ. Code § 1747.08.
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1 modified the class definition to:
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[A]ll persons from whom Ikea requested and recorded a ZIP Code in
conjunction with a credit card transaction in California from February 16, 2010
through February 28, 2011 (the ‘Class’). Excluded from the Class are (i)
transactions wherein personal information was required for a special purpose
incidental but related to the individual credit card transaction, including, but not
limited to, information relating to shipping, delivery, servicing, or installation
of the purchased merchandise, or for special orders; (ii) transactions wherein
a credit card issued to a business was used; and (iii) transactions executed at
self-checkout kiosks.

7 Id. at 28-29. The February 27, 2013 Order also denied Plaintiffs’ Motion to Compel
8 Notice without prejudice and with leave to amend “in light of the Court’s decision to
9 both modify the class period and exclude transactions conducted at self-checkout kiosks
10 from the class definition....” Id. at 28.
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On March 28, 2013, Plaintiffs filed an Amended Motion to Compel Notice to the

12 Certified Class (“Amended Motion to Compel Notice”). (ECF No. 95). Along with the
13 Amended Motion to Compel Notice, Plaintiffs included three proposed notices that
14 were “modified to conform to the revised Class definition, and the parties have agreed
15 to the substance of the proposed notices.” Id. at 2; Declaration of Gene J. Stonebarger
16 (“Stonebarger Decl.”) Exh. A “Long Form Notice,” ECF No. 95-2; Exh. B “In-Store
17 Notice,” ECF No. 95-3; and Exh. C “Short Form Notice,” ECF No. 95-4. Plaintiffs
18 indicate that the parties have agreed upon the following notice procedures: (1)
19 publication notice on a website containing a copy of the Long Form Notice, case
20 information, and contact information for Class Counsel; and (2) posting the In Store
21 Notice at the customer service desk located in each of Ikea’s California retail stores.
22 (ECF No. 95 at 3). Plaintiffs contend that the parties, “have met and conferred ...
23 regarding a proposed notice plan but dispute whether notice should be disseminated to
24 potential class members by email and whether notice should be posted at the point-of25 sale locations in Ikea’s California stores. The parties also dispute who bears the cost
26 of notice.” (ECF No. 95 at 2).
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On April 15, 2013, Defendant filed an opposition to Plaintiffs’ Amended Motion

28 to Compel Notice. (ECF No. 96). Defendant contends that “[P]laintiff[s’] plan for e-3-

11cv701 WQH (BGS)

1 mail to all of Ikea’s customers and posting at every point of sale throughout its stores
2 should be rejected in favor of the other two methods proposed: (1) website notice, and
3 (2) a single posting in each store where Ikea’s other notices to customers are placed.”
4 Id. at 6. Plaintiffs request that, “if direct notice is ordered, then the notice should be
5 accompanied by a questionnaire to putative class members that will allow the Court and
6 the parties to define the claims to be tried and validate the process the Court envisions
7 for trial....” Id. at 8. Defendant attached a proposed questionnaire as Exhibit A. (ECF
8 No. 96-1). On April 22, 2013 Plaintiffs filed a reply. (ECF No. 98).
9 II.
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Discussion
Plaintiffs seek an order from this Court that, in addition to the two methods of

11 notice agreed upon by the parties, “the In-Store Notice should be posted (in tear-away
12 form) at the point-of-sale locations in each of Ikea’s California stores.” (ECF No. 95
13 at 3). “Plaintiff[s] also propose[] that the Short Form Notice ... be sent via email to all
14 of Ikea’s customers for whom Ikea maintains an email address.” Id. Finally, Plaintiffs
15 contend that “the cost of notice should be borne by Ikea....” Id.
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Federal Rule of Civil Procedure 23(c)(2)(B) provides that “[f]or any class

17 certified under Rule 23(b)(3), the Court must direct to class members the best notice
18 that is practicable under the circumstances, including individual notice to all members
19 who can be identified through reasonable effort.” Rule 23(c)(2)(B) provides that the
20 notice must:
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clearly and concisely state in plain, easily understood language: (i) the
nature of the action; (ii) the definition of the class certified; (iii) the class
claims, issues, or defenses; (iv) that a class member may enter an
appearance through an attorney if the member so desires; (v) that the court
will exclude from the class any member who requests exclusion; (vi) the
time and manner for requesting exclusion; and (vii) the binding effect of
class judgment on members under Rule 23(c)(3).

25 Id.
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The parties in this case have “generally agreed to the substance of the notice....”

27 (ECF No. 95 at 4). Having reviewed the proposed notices, the Court finds that these
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1 notices satisfy the requirements of Rule 23(c)(2)(B).2 Specifically, the Court approves
2 of the forms of notice attached to Plaintiffs’ Amended Motion to Compel Notice as
3 Exhibits A, B, and C. (ECF Nos. 95-2, 95-3, 95-4). The Court also approves of the
4 procedures agreed upon by the parties: (1) publication notice on a website containing
5 a copy of the Long Form Notice, case information, and contact information for Class
6 Counsel; and (2) In-Store Notice posted at the customer service desk located in each of
7 Ikea’s California retail stores. (ECF No. 95 at 3). The Court reviews each of Plaintiffs’
8 additional proposed notice procedures to determine if they are the “best practicable
9 under the circumstances” as required by Rule 23(c)(2)(B).
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A.

Notice at Point-of-Sale Locations

Plaintiffs contend that, “... posting a summary notice at each point-of-sale

12 location in Ikea’s California retail stores is economical and reasonably designed to
13 reach Ikea’s customers who are likely to have previously purchased at Ikea during the
14 Class period and included in the Class.” (ECF No. 95 at 2). Plaintiffs contend that,
15 “[p]roviding notice at the location where the conduct at issue originally occurred is most
16 likely to reach Class members and is the most visible to them.” Id. at 7. “...[P]otential
17 Class members will pass through the point of sale locations at Ikea stores but only a
18 small percentage will go to the customer service counter.” Id.
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Defendant contends that posting notices at each point-of-sale location “is not

20 practicable and is an unreasonable request that will have a negative impact on Ikea’s
21 reputation with current and future customers (the vast majority of whom are not
22 members of the class) and interfere with its legitimate interest in efficiently serving its
23 customers.” (ECF No. 96 at 15). Defendant asserts that “the presence of notices at the
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To the extent that the proposed notices advise potential Class members that they
may “keep any rights to sue Ikea separately about the same claims in this lawsuit,”
26 (ECF No. 95-2 at 2; 95-4 at 2), the Court does not make any determination as to
whether individuals could bring a claim against Defendant under the The Song-Beverly
27 Credit Card Act should they request to be excluded from the Class. See, e.g. Cal. Civ.
Code § 1747.08 (violations of the Song-Beverly Credit Card Act have a one-year statute
28 of limitations).
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1 dozens of points of sale is likely to result in questions from customers to cashiers about
2 the action, about the class, and about membership.” Id. at 16.
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Plaintiffs cite numerous cases to support their position that posting notice in a

4 conspicuous retail location is an appropriate notice procedure. (ECF No. 95 at 6).
5 However, in none of the cases cited by Plaintiffs did the court specifically approve of
6 multiple postings per retail location, or posting at each point-of-sale. See Ersler v.
7 Toshiba America, Inc., CV-07-2304, 2009 U.S. Dist. LEXIS 14374, at *3 (E.D.N.Y.
8 Feb. 24, 2009) (approving a plan to post notice at retailers where alleged defective
9 televisions are sold); In re Domestic Air Transp. Antitrust Litig., 141 F.R.D. 534, 55010 51 (N.D. Ga. 1992) (approving a plan to post notice in ticket offices); Galvan v. KDI
11 Distrib., SACV 08-0999, 2011 U.S. Dist. LEXIS 127602, at *12-13 (C.D. Cal. Oct. 25,
12 2011) (approving plan to post notice at retail stores where prepaid calling cards at issue
13 are sold); Fiore v. Goodyear, No. 2:09-cv-843, 2011 U.S. Dist. LEXIS 24371, at *11
14 (M.D. Fla. Mar. 10, 2011) (approving plan that placed only one notice form in each
15 retail store); Todd v. Retail Concepts Inc., No. 3:07-0788, 2008 U.S. Dist. LEXIS
16 117126, at *7 (M.D. Tenn. Aug. 22, 2008) (approving “one in-store posting” at or near
17 the cash register of each retail store).
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The Court finds that posting notices at each point-of-sale location in each of

19 Ikea’s California locations is not practicable and not supported by law. The Court finds
20 that posting notice at each point-of-sale location is likely to cause confusion and would
21 encourage inquiries by non-class members, which could interfere with Ikea’s reputation
22 and business. See Macarz v. Transworld Sys., Inc., 201 F.R.D. 54, 64 (D. Conn. 2001)
23 (stating that “sending notice to the admittedly over-inclusive group here would most
24 likely confuse the recipients and encourage [inquiries] by non-class members.”); In re
25 Domestic Air, 141 F.R.D. at 539-46 (same). The Court finds that posting notices at
26 each point of sale is not practicable under the circumstances, and is therefore not
27 required by Rule 23. Fed. R. Civ. P. 23(c)(2)(B). The Court denies Plaintiffs’ request
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1 stores.
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B.

Notice by Email

Plaintiffs contend that, “notice by email is effective, economical, and satisfies the

4 requirements of Fed. R. Civ. P. 23(c)(2)(B). Email notice to Ikea’s customers for whom
5 Ikea has email information is appropriate because it is the most cost effective manner
6 to directly reach a significant number of potential Class members.” (ECF No. 95 at 2).
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Defendant contends that email notice “is so substantially over-inclusive and

9 under-inclusive that it bears no reasonable relationship to membership in the class.”
10 (ECF No. 96 at 6). Defendant states that its email list consists of over 1.6 million email
11 addresses that were obtained from a variety of sources, including Ikea sign up forms,
12 the Ikea Family program, Ikea’s website registration pages, Ikea in-store contests and
13 giveaways, and Ikea’s partnerships with other media channels. Id. at 10-11. Defendant
14 explains that, “[c]lose to 1 million of these emails were obtained before the class
15 period” and that “... Ikea has no way to link any email in its possession with the
16 individual putative class members who have never been identified by name, or
17 otherwise.” Id.
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Under Rule 23, a court must “direct to class members the best notice that is

19 practicable under the circumstances, including individual notice to all members who can
20 be identified through reasonable effort.” Fed. R. Civ. P. 23(c)(2)(B). “Where the
21 names and addresses of class members may be ascertained through reasonable efforts,
22 individual notice must be sent.” Jermyn v. Best Buy Stores, L.P., No. 08 Civ.
23 00214(CM), at *2, 2010 WL 5187746 (S.D.N.Y Dec. 6, 2010) (citing Eisen v. Carlisle
24 & Jacquelin, 417 U.S. 156, 173 (1974)). However, “if the names and addresses of class
25 members cannot be determined by reasonable efforts, notice by publication is sufficient
26 to satisfy the requirements of the due process clause and Rule 23.” Id; see also Mullane
27 v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 317-18 (1950); Johnson v. General
28 Mills, Inc., No. SACV 10-00061-CJC (ANx), 2013 WL 3213832, at *4 (C.D. Cal. June
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1 17, 2013) (notice by publication is used when identity and location of class members
2 cannot be determined through reasonable efforts); In re Wal-Mart Stores, Inc. Wage &
3 Hour Litig., No. 06-02069 SBA, 2008 WL 1990806, at *2 (C.D. Cal. May 5, 2008).
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Notice to individuals is improper and not required by Rule 23 when it is overly

5 broad or over-inclusive. See In re Domestic Air, 141 F.R.D. at 539 (court held that it
6 was not necessary to send individual notice to all those on an over-inclusive list when
7 there was no data which would enable the parties to determine who on the list was a
8 class member); In re “Agent Orange” Product Liab. Litig., 818 F.2d 145, 169 (2d Cir.
9 1987) (rejecting argument that individual mail notice should have been provided to all
10 2.4 million Vietnam Veterans, when “far fewer than that number were exposed to Agent
11 Orange” and thus notice would have been “considerably overbroad”); In re Nissan
12 Motor Corp. Antitrust Litig., 552 F.2d 1088, 1099 (5th Cir. 1977) (rejecting proposed
13 list of individuals to receive class notice, including both class members and non-class
14 members, as being over-inclusive and as helpful as a “telephone book”).
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In Jermyn v. Best Buy Stores, the Southern District of New York found that

16 individual notice by email was improper because Best Buy’s email list would provide
17 notice to “an overinclusive group of individuals.” 2010 WL 5187746, at *7. In Jermyn,
18 a class was certified of customers who were denied the benefit of Best Buy’s price
19 match program. Id. Plaintiff proposed email notification to Best Buy’s entire email list.
20 Id. The court found that, “there is no link between customers who have shared their
21 email addresses with Best Buy and customers who were denied a price match.” Id. The
22 court found that, “Jermyn’s proposed email notice will provide individual notice to an
23 overinclusive group of individuals.... [I]ndividual notice to an overinclusive group is
24 not required by Rule 23.” Id. (citing e.g., In re “Agent Orange” Product Liab. Litig.,
25 818 F.2d at 169). “The list of email addresses, while limited to New York, may not
26 necessarily correspond to customers who were denied a valid price match.” Id.
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In this case, like in Jermyn, there is no link between individuals who may have

28 provided their email addresses at some point between February 10, 2010 and February
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1 28, 2011, and individuals who are members of the class. The list of 1.6 million
2 individuals who gave Ikea their email addresses for a wide variety of purposes bears no
3 reasonable relationship to the group of individuals whose zip codes were requested and
4 recorded in conjunction with a credit card transaction. The Court concludes that notice
5 by email is considerably overbroad, overinclusive, and not the best method “practicable
6 under the circumstances” as required by Rule 23. Fed. R. Civ. P. 23(c)(2)(B). At this
7 stage in the proceedings, before any liability has been found, the Court denies Plaintiffs’
8 request to order notice by email to Defendant’s list of over 1.6 email addresses.
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C.

Cost of Notice

Plaintiffs contend that, “Ikea should be solely responsible for the cost of

11 providing notice.” (ECF No. 95 at 10). Plaintiffs contend that even though plaintiff
12 usually bears the cost of notice, the cost may be shifted after a showing of success on
13 the merits. (ECF No. 95 at 9). Plaintiffs contend that, “there is no question that the
14 Class claims have substantial merit.” Id. Plaintiffs also contend that “the relative
15 resources of the parties weigh in favor of shifting the cost of notice to Ikea.” Id. at 10.
16 Defendant contends that, “Plaintiff[s] must bear the cost of notice since there has been
17 no decision on the merits which would warrant cost shifting.” (ECF No. 96 at 7).
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“The usual rule is that a plaintiff must initially bear the costs of notice to the

19 class.” Eisen, 417 U.S. at 178. The Ninth Circuit has found that “interim litigation
20 costs, including class notice costs, may be shifted to defendant after plaintiff’s showing
21 of some success on the merits, whether by preliminary injunction, partial summary
22 judgment, or other procedure.” Hunt v. Imperial Merchant Servs., Inc., 560 F.3d 1137,
23 1143 (9th Cir. 2009).
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At this stage in the proceedings, before any liability has been found, the Court

25 finds that the cost of notice should remain with Plaintiff. Plaintiff’s request to order
26 Defendant to bear the costs of notice is denied.
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Conclusion

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IT IS HEREBY ORDERED that the Amended Motion to Compel Notice to the
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1 Certified Class filed by Plaintiffs (ECF No. 95) is GRANTED in part and DENIED in
2 part. Notice shall be provided to the Class in the manner agreed upon by the parties:
3 (1) by the creation and maintenance of a website containing the Long-Form Notice, case
4 information, and contact information for Class Counsel; and (2) by posting the In-Store
5 Notice at the customer service desk located in each of Ikea’s California retail stores.
6 Plaintiffs’ requests for (1) email notice by Ikea to all of its customers for whom Ikea has
7 an email address, and (2) the posting of in-store notice at each point-of-sale register for
8 30 days, are DENIED. Plaintiffs shall bear all costs associated with notice to the class.
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10 DATED: November 5, 2013
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WILLIAM Q. HAYES
United States District Judge

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