VALLI v. AVIS BUDGET RENTAL CAR GROUP, LLC et al

Filing 231

OPINION. Signed by Magistrate Judge James B. Clark on 10/10/2023. (Notice of Mail) (dam) Modified on 10/10/2023 (dam).

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UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

DAWN VALLI, et al., individually and on
behalf of others similarly situated,
Civil Action No. 14-6072 (JBC)
Plaintiffs,
OPINION
v.
AVIS BUDGET RENTAL CAR GROUP,
LLC, et al.,
Defendants.

CLARK, Magistrate Judge
THIS MATTER comes before the Court on a motion by Plaintiffs Dawn Valli and Anton
S. Dubinsky (collectively, “Plaintiffs”) for class certification [Dkt. No. 146]. Defendants Avis
Budget Group, Inc., Avis Budget Car Rental, LLC, Avis Rent a Car System, LLC, and Budget
Rent a Car System, Inc. (collectively “Defendants”) oppose Plaintiffs’ motion [Dkt. No. 153]. The
Court has fully reviewed the arguments made in support of, and in opposition to, Plaintiffs’ motion,
including the parties’ oral argument conducted before the Honorable Claire C. Cecchi, U.S.D.J.,
on April 16, 2021 [see Dkt. No. 191 (transcript)]. For the reasons set forth below, Plaintiffs’ motion
for class certification [Dkt. No. 146] is DENIED as to the Plaintiffs’ proposed nationwide class
and GRANTED as to a Preferred Members Subclass created at the Court’s discretion
pursuant to Rule 23(c)(4)(B).
I.

BACKGROUND
Procedural History
On September 30, 2014, Plaintiff Dawn Valli (“Valli”) initially filed a class action

complaint against Defendants Avis Budget Rental Car Group, LLC and ATS Processing Services,
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LLC (“ATS”)1 regarding their alleged “misrepresentations and omissions concerning charging [car
rental customers] for alleged traffic infractions and an administrative fee without consent, without
disclosure, and without the opportunity to contest the allegation.” Dkt. No. 147 at 1. On January
22, 2015, Valli filed a First Amended Class Action Complaint against Avis Budget Group, Inc.,
Avis Rent A Car System, LLC, and ATS (collectively, “Defendants” or “ABG”) alleging: (1)
violations of the New Jersey Consumer Fraud Act (“NJCFA”); (2) breach of the implied covenant
of good faith and fair dealing; (3) unjust enrichment; and (4) unconscionability under the laws of
New Jersey. See Dkt. No. 23. On March 9, 2015, Defendants filed a motion to dismiss, which was
administratively terminated on April 12, 2016, pending completion of jurisdictional discovery. See
Dkt. No. 42. On August 17, 2016, by stipulation of the parties, ATS Processing Services, a named
defendant in the initial complaint, was dismissed without prejudice. See Dkt. No. 50. The following
day, on August 18, 2016, Defendants filed another motion to dismiss. See Dkt. No. 49. On May
10, 2017, the Court denied Defendants’ motion to dismiss in its entirety, finding, among other
things, that the Rental Agreements—i.e., the contracts Defendants enter into with their car rental
customers—neglected to state that “Plaintiff would not have the opportunity to contest any such
fines, and that [ABG] would pay the fine prior to any adjudication of the underlying violation.”
Dkt. No. 65 at 10. The Court therefore concluded that “[t]hese facts may constitute an affirmative
act of misrepresentation.” Id.
After the Court denied Defendants’ motion to dismiss, discovery commenced. See Dkt. No.
67. In response to Defendants’ contention that Plaintiff only had standing for discovery related to
the Avis brand because Valli was an Avis renter, and pursuant to the parties’ stipulation, on June

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ATS, a third-party vendor that processes and administers the payment of fines accrued while customers rented
vehicles from Avis and Budget, see Dkt. No. 1 at ¶ 4, was voluntarily dismissed as a Defendant in August of 2016.
Dkt. No. 50.

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26, 2018, Plaintiff filed a Second Amended Class Action Complaint adding Anton S. Dubinsky
(“Dubinsky”), a Budget brand renter, as a plaintiff and adding defendants Avis Budget Car Rental,
LLC and Budget Rent a Car System, Inc., wholly-owned subsidiaries of Avis Budget Group, as
defendants. See Dkt. No. 95. But for certain allegations related to Dubinsky’s car rental, the Second
Amended Class Action Complaint closely tracked the First Amended Complaint. Id. On
September 25, 2018, Defendants filed their Amended Answer to the Second Amended Complaint.
See Dkt. No. 108.
On July 1, 2019, Plaintiffs filed the instant motion for class certification. See Dkt. No. 146.
In their motion, Plaintiffs seek to certify the following class for the period of September 30, 2008,
through the Present (the “Class Period”):
All United States residents who rented an Avis or Budget brand vehicle
during the Class Period and whose rented vehicle was the subject of an
alleged parking, traffic, toll or other violation, where: (1) the ticket issuing
authority sent notice of the ticket directly to ABG; (2) ABG or its agent paid
the fine and/or court costs associated with the alleged violation; and (3)
ABG charged the vehicle renter for such fine, penalty and court costs,
and/or an associated administrative fee.
Dkt. No. 146-1 at 1-2. “As used to define the [proposed] Class, ‘residents’ includes natural persons
and business entities. Excluded from the [proposed] Class are: (1) Defendants; (2) their officers,
directors, and employees, (3) entities in which Defendants have a controlling interest; (4) affiliates,
legal representatives and assigns of Defendants; and (5) judges who have presided over this case
and members of their immediate families.” Id. at 2.
On March 17, 2020, the Court referred the parties to mediation. See Dkt. No. 175. On June
30, 2020, after the parties reported the mediation was unsuccessful, the Court reinstated the motion
for class certification. See Dkt. No. 180. On April 16, 2021, Judge Cecchi held oral argument on
Plaintiffs’ motion for class certification. See Dkt. Nos. 188, 190, 191 (transcript of oral argument).
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On July 13, 2021, the parties advised that they were engaging in private mediation. See Dkt. No.
193. On October 27, 2021, the Court administratively terminated Plaintiffs’ motion for class
certification pending the receipt of letters from the parties advising as to the status of
settlement/mediation. See Dkt. No. 198. On July 19, 2022, the Court directed the parties to submit
supplemental briefing regarding predominance for each asserted claim and again administratively
terminated Plaintiffs’ motion pending receipt of the parties’ submissions. See Dkt. No. 206. On
February 28, 2023, Judge Cecchi signed and entered a consent order executed by the parties
consenting to the jurisdiction of the Undersigned pursuant to 28 U.S.C. § 636 and Federal Rule of
Civil Procedure 73. See Dkt. No. 218. On March 28, 2023, the Court reinstated Plaintiffs’ motion
for class certification. See Dkt. No. 221.
Statement of Facts
Valli, a Florida resident and Avis Preferred member, rented an Avis brand car from
Defendants’ Maryland facility at Baltimore-Washington International Airport on June 11, 2014,
and was ticketed by an automatic traffic enforcement device which captured the rental vehicle
going 52 mph in a 35-mph zone in Washington, DC on that same day (the “Infraction”). Dkt. Nos.
147 at 6; 153 at 5. On July 3, 2014, Avis sent Valli a copy of the Infraction and notified Valli that
it had paid the fine and that Valli owed the $150 fine plus a $30 “handling” fee. Dkt. Nos. 147 at
6; 153 at 6. Although the deadline to contest the ticket was August 17, 2014, Avis indicated in its
July 3, 2014 notice that it had already paid the $150 fine. Dkt. No. 147 at 6-7. After Valli did not
pay the fee or fine through another payment arrangement, Avis charged the credit card on file. Dkt.
No. 153 at 6.
Dubinsky, a Missouri resident, rented a Budget brand car from Defendants’ facility at 780
McDonnell Road, San Francisco, California on November 25, 2014, that was captured running a

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red light by a San Francisco-operated detection and enforcement device on November 26, 2014.
Dkt. Nos. 147 at 7; 153 at 7. On December 5, 2014, the San Francisco Police Department issued a
Summons charging a fine of $490 and stating that a response was due by December 29, 2014. Dkt.
No. 147 at 7. On December 30, 2014, ABG notified Dubinsky that it had paid the $490 fine and
that Dubinsky owed the $490 fine and a $30 fee, and that his failure to pay ABG by January 29,
2015, would result in his credit card being charged for the full amount. Id. After Dubinsky refused
to pay the fine or fee, his credit card on file was charged. Dkt. No. 153 at 8.
The parties dispute the language in the relevant clause of the Rental Agreement, with
Plaintiffs asserting “[t]he ABG Contract consists of the standardized and uniform Rental Jacket
and Rental Document,” which states the following:
Fines, Expenses, Costs and Administrative Fees. You’ll pay all fines,
penalties, and court costs for parking, traffic, toll, and other violations,
including storage liens and charges. You will also pay a reasonable
administration fee with respect to any violation of this agreement, such as
repossessing or recovering the car for any reason.
Dkt. No. 147 at 9. Plaintiffs aver that this clause “is the same for all Class Members across the
United States, regardless of rental brand (i.e., Avis/Budget) or participation in an “affinity
program” (i.e., Avis Preferred/Budget Fastbreak).” Id. at 10. Conversely, Defendants claim that
“[t]he terms of Avis and Budget’s rental agreements have changed at various times during the
proposed class period,” including different language related to “violations” and certain versions
adding binding arbitration clauses and class action waivers. Dkt. No. 153 at 8-9. Defendants state
that ABG’s member programs, namely “Preferred” for Avis and “Fastbreak” for Budget, also
contain different agreements than for non-members. Id. at 9.

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II.

LEGAL STANDARD
“Class certification is proper only ‘if the trial court is satisfied, after a rigorous analysis,

that the prerequisites’ of Rule 23 are met.” In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305,
309 (3d Cir. 2008) (quoting Gen Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161 (1982)). To meet the
prerequisites of Rule 23, a plaintiff must establish both that the four requirements of Rule 23(a)
have been met—those being numerosity, commonality, typicality, and adequacy—as well as that
the pleading requirements of Rule 23(b)(1), (2), or (3) have been met. Fed. R. Civ. P. 23; see also
Hydrogen Peroxide, 552 F.3d at 309 n.6.
In analyzing whether Rule 23’s requirements have been met, “the district court must make
whatever factual and legal inquiries are necessary and must consider all relevant evidence and
arguments presented by the parties.” Hydrogen Peroxide, 552 F.3d at 307. This is true even if the
class certification inquiry overlaps with the merits of the causes of action. Id. Additionally, if there
is any doubt as to whether the Rule 23 requirements have been met, certification should be denied,
regardless of the area of substantive law. Id. at 321 (discussing the 2003 Amendments to Rule 23).
The parties do not dispute that only subsection (b)(3) applies to the instant action. A Rule
23(b)(3) class action may be maintained if “the court finds that the questions of law or fact common
to class members predominate over any questions affecting only individual members
[(predominance)], and that a class action is superior to other available methods for fairly and
efficiently adjudicating the controversy [(superiority)].” Fed. R. Civ. P. 23(b)(3); see also
Hydrogen Peroxide, 552 F.3d at 310. “Because the nature of the evidence that will suffice to
resolve a question determines whether the question is common or individual, a district court must
formulate some prediction as to how specific issues will play out [at trial] in order to determine
whether common or individual issues predominate in a given case.” Hydrogen Peroxide, 552 F.3d

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at 311 (citations and quotations omitted). “If proof of the essential elements of the cause of action
requires individual treatment, then class certification is unsuitable.” Id. (quoting Newton v. Merrill
Lynch, Pierce, Fenner & Smith, Inc., 259 F.3d 154, 172 (3d Cir. 2001)). Therefore, in addition to
the four requirements of Rule 23(a), Plaintiffs in this case bear the burden of establishing that
common issues of fact and law predominate and that a class action is superior.
III.

DISCUSSION
As noted, Plaintiffs seek in their motion to certify the following class for the period of

September 30, 2008, through the Present (the “Class Period”):
All United States residents who rented an Avis or Budget brand vehicle
during the Class Period and whose rented vehicle was the subject of an
alleged parking, traffic, toll or other violation, where: (1) the ticket issuing
authority sent notice of the ticket directly to ABG; (2) ABG or its agent paid
the fine and/or court costs associated with the alleged violation; and (3)
ABG charged the vehicle renter for such fine, penalty and court costs,
and/or an associated administrative fee.
Dkt. No. 146-1 at 1-2. Plaintiffs assert the following claims on behalf of the proposed class: (1)
violations of the NJCFA; (2) breach of the implied covenant of good faith and fair dealing; (3)
unjust enrichment; and (4) unconscionability under the laws of New Jersey. See Dkt. No. 23. As
set forth more fully below, the Court finds that class certification is appropriate as to a subclass
consisting of nationwide Avis Preferred and Budget Fastbreak members (the “Preferred Members
Subclass”) with Valli as Class Representative, but that Plaintiffs’ broader proposed class cannot
be certified because the choice-of-law queries for a nationwide class would destroy predominance,
and thus Plaintiffs fail to satisfy the predominance requirement under Fed. R. Civ. P. 23(b)(3).
As noted in Plaintiffs’ Reply Brief, Defendants appear solely to oppose class certification
on the grounds of typicality, predominance, and superiority. Dkt. No. 159 at 2. Though the parties

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do not challenge the numerosity, commonality, adequacy, and ascertainability requirements for
certification [see id.], the Court will consider all of the Rule 23 requirements in turn.
A. Numerosity
Numerosity is satisfied when “the class is so numerous that joinder of all members is
impracticable.” Fed. R. Civ. P. 23(a)(1). “[G]enerally if the named plaintiff demonstrates that the
potential number of plaintiffs exceeds 40, [numerosity] has been met.” Bouder v. Prudential Fin.,
Inc., 2015 WL 857655, at *6 (D.N.J. Feb. 26, 2015). While the Court declines to adopt Plaintiffs’
proposed class which would encompass millions of members, see Dkt. No. 147 at 15, the Court
finds that even the Preferred Members Subclass satisfies the numerosity requirement, as
Defendants stated during oral argument that there is likely over 50,000 Preferred Members
nationwide and “the number of people who are preferred members who have gotten tickets is likely
still significant in terms of numerosity.” Dkt. No. 191 at 14:20-25. Accordingly, the numerosity
requirement under Rule 23(a)(1) is satisfied.
B. Commonality and Predominance
It is customary in Rule 23(b)(3) class actions for courts to jointly apply the Rule 23(a)(2)
commonality requirement and the Rule 23(b)(3) predominance tests. In re Prudential Ins. Co. of
Am. Sales Practices Litig. (“Prudential I”), 962 F. Supp. 450, 510 (D.N.J. 1997), aff’d, 148 F.3d
283 (3d Cir. 1998) (“Prudential II”), cert. denied, 525 U.S. 1114 (1999) (citing 1 Herbert Newberg
& Alba Conte, Newberg on Class Actions (“Newberg”) § 3.13, at 3-71). This approach has been
approved by the Third Circuit. See In re Warfarin Sodium Antitrust Litig., 391 F.3d 516, 528 (3d
Cir. 2004) (“[T]he Rule 23(b)(3) predominance requirement, which is far more demanding,
incorporates the Rule 23(a) commonality requirement. . . . Accordingly, we analyze the two factors

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together.”) (citations omitted); see also Georgine v. Amchem Prods., 83 F.3d 610, 626 (3d Cir.
1996).
Commonality is satisfied when “there are questions of law or fact common to the class.”
Fed. R. Civ. P. 23(a)(2). “This requirement is satisfied if the named plaintiffs share at least one
question of fact or law with the grievances of the prospective class.” Mendez v. Avis Budget Grp.,
Inc., No. CV 11-6537 (JLL), 2017 WL 5513691, at *4 (D.N.J. Nov. 17, 2017) (quoting Prudential
I, 962 F. Supp. at 510). Here, the commonality requirement is met because there are several
common questions, including the following which were identified by the Court in its Opinion
denying Defendants’ motion to dismiss:
(1) [w]hether the “Rental Agreement failed to disclose that Defendants
would charge car renters for any alleged traffic infraction without the
opportunity to contest fines assessed against their rental vehicle during the
rental period”;
(2) [w]hether Defendants’ “lack of clear and comprehensive disclosure of
Plaintiff’s liability for fines accrued against the vehicle absent prior notice
and the opportunity to contest such fines, is sufficient to alleged
Defendants’ intent or knowledge to conceal or omit a material fact”;
(3) whether ABG made “affirmative misrepresentations regarding the lack
of opportunity to contest alleged fines” such as “that Plaintiffs would be
charged for all violations accrued against the vehicle during the rental
period” without also stating “that Plaintiff would not have the opportunity
to contest any such fines, and that Defendants would pay the fine prior to
any adjudication of the underlying violation”; and
(4) [w]hether there is a “causal connection between the Defendants’
unlawful conduct and the [] ascertainable loss when [plaintiffs were]
charged a fine and administrative fee by Defendants for an alleged traffic
violation, without the opportunity to contest such violation, through the
pretext of [the] Rental Agreement with Defendants.”

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Id. at 15-16 (quoting Dkt. No. 65 at 9-10) (other citations omitted). Plaintiffs further assert that
these findings by the Court were confirmed through the discovery conducted in this matter. Id.
While the Court finds that the commonality requirement is met here, for a class that is
certified under Rule 23(b)(3), which is what Plaintiffs are seeking here, the Court must find that
these common questions predominate over individual issues. Prudential I, 962 F. Supp. at 510–
11. “To evaluate predominance, the Court must determine whether the efficiencies gained by class
resolution of the common issues are outweighed by individual issues presented for adjudication.”
Id. at 511 (citing 1 Newberg § 4.25, at 4-81 to 4-86).
Plaintiffs assert the predominance requirement is satisfied here because this standard is
“readily met” in “consumer cases.” Dkt. No. 147 at 26 (quoting Amchem Prods., Inc. v. Windsor,
521 U.S. 591, 625 (1997)). “This is because ‘the clear focus . . . is on the alleged deceptive conduct
of the defendant, and not on the conduct of individual class members.’” Id. (quoting In re Ins.
Brokerage Antitrust Litig., 282 F.R.D. 92, 108 (D.N.J. 2012)); see also Sheinberg v. Sorensen,
2016 WL 3381242, at *4 (D.N.J. June 14, 2016) (predominance satisfied where “proof of liability
depends on the conduct of the defendant”); Saini v. BMW of N. Am., LLC, 2015 WL 2448846, at
*5 (D.N.J. May 21, 2015) (predominance satisfied because defendants’ policy was “subject to
generalized proof” and “common to all class members”); Varacallo v. Massachusetts Mut. Life
Ins. Co., 226 F.R.D. 207, 231 (D.N.J. 2005) (in cases alleging defendant “made similar
misrepresentations, non-disclosures, or engaged in a common course of conduct, courts have found
that conduct to satisfy the commonality and predominance requirements”). Plaintiffs further argue
that New Jersey law should be applied here to their four causes of action: (1) breach of the NJCFA;
(2) breach of the implied covenant of good faith and fair dealing; (3) unjust enrichment; and (4)
unconscionable conduct. Id.

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Defendants provide numerous arguments for why Plaintiffs fail to meet the predominance
requirement, the core of which is that New Jersey law does not apply to Plaintiffs’ claims on a
class-wide basis, and therefore choice-of-law queries will destroy predominance.
The Court agrees with Defendants that the predominance requirement fails as to a
nationwide class due to choice-of-law issues. Courts have previously found that a class action
cannot be maintained where different class members are subject to the laws of different states and
have denied certification on those grounds. See, e.g., Mardis v. Jackson Hewitt Tax Serv. Inc., No.
CV 16-2115, 2021 WL 1625118, at *8 (D.N.J. Apr. 27, 2021) (explaining the high burden on
plaintiffs to group together and overcome variations in states’ laws and denying certification of a
class for failing to establish predominance for breach of contract and unjust enrichment claims).
Where, as here, there is the potential for laws of all fifty states to apply to the class members, it
would be impossible for the Court to instruct a jury. The issues of conflicts of laws swallow the
common issues between class members; thus, the nationwide class proposed by Plaintiffs cannot
proceed here. While Plaintiffs assert that New Jersey law applies to the class as a whole for each
of their four asserted claims, the Court will utilize the applicable choice of law rules and assess
each claim in turn to demonstrate that New Jersey law cannot apply to the class as a whole.
“A federal court sitting in diversity applies the choice of law rules of the forum state . . . to
determine the controlling law.” Maniscalco v. Brother Int’l (USA) Corp., 709 F.3d 202, 206 (3d
Cir. 2013) (citations omitted). When deciding choice of law, New Jersey uses the “most significant
relationship test” from the Restatement (Second) of Conflict of Laws. Id. The first step of the
choice-of-law inquiry is “to determine whether there is an actual conflict between the laws of the
potential forums.” Id. (citations omitted). If there is a conflict, then the second step of the test is to

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determine which state has the “most significant relationship” to the claim. Id. at 207 (citation
omitted). The Court will address the choice-of-law analysis for each of Plaintiffs’ claims, in turn.
NJCFA
The parties agree that there are conflicts between the different consumer fraud protection
laws in different states. See Dkt. Nos. 147 at 23; 153 at 14-19. The parties also agree that the
NJCFA claim Plaintiffs seek to bring on behalf of the class is a fraud or misrepresentation claim
and that Plaintiffs’ car rentals and alleged traffic violations took place in a different state from
where the representations were made. Therefore, the Court will use the test under § 148(2) of the
Restatement to determine which state has the “most significant relationship” to the NJCFA claim.
Dkt. Nos. 147 at 23; 153 at 14-19. The test balances the following factors:
(a) the place, or places, where the plaintiff acted in reliance upon the
defendant’s representations, (b) the place where the plaintiff received the
representations, (c) the place where the defendant made the representations,
(d) the domicile, residence, nationality, place of incorporation and place of
business of the parties, (e) the place where a tangible thing which is the
subject of the transaction between the parties was situated at the time, and
(f) the place where the plaintiff is to render performance under a contract
which he has been induced to enter by the false representations of the
defendant.
Restatement (Second) of Conflict of Laws § 148(2). As to (a), the proposed class of plaintiffs in
this case come from all fifty states, and rented cars in all fifty states. This factor weighs against
applying New Jersey law to any class members who did not rent cars in New Jersey. As to (b), the
class members received Defendants’ representations in the states where they entered into contracts
to rent cars from Defendants. This factor weighs against applying New Jersey law to any class
members who did not contract to rent cars in New Jersey. Regarding (c), Defendants made the
representations in New Jersey by creating the contract there. This factor weighs in favor of
applying New Jersey law. As to (d), the class members come from all fifty states, which weighs

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against applying New Jersey law. As to (e), the class members rented the cars and drove them
throughout all fifty states, which weighs against applying New Jersey law. As to (f), the class
members rendered their performance by paying in whatever state they rented the car, which weighs
against applying New Jersey law. Thus, five out of the six factors weigh against applying New
Jersey law to the entire class for the NJCFA claim.
Further, courts in this Circuit have criticized the notion of applying New Jersey law in
NJCFA cases where, as here, the defendant is merely headquartered in New Jersey and has made
the alleged misrepresentations in New Jersey. See Montich v. Miele USA, Inc., 849 F. Supp. 2d
439, 448-50 (D.N.J. 2012); see also Agostino v. Quest Diagnostics Inc., 256 F.R.D. 437, 461-62
(D.N.J. 2009). Therefore, New Jersey law cannot not be applied across the board to Plaintiffs’
NJCFA claim, and there cannot be predominance as to Plaintiffs’ nationwide class as proposed
because different states’ consumer fraud protection laws would need to be applied to each class
member’s claims.
Breach of the Implied Covenant of Good Faith and Fair Dealing
The parties disagree as to whether there are relevant contract law conflicts regarding
Plaintiffs’ breach of the implied covenant of good faith and fair dealing claim. In their reply brief,
Plaintiffs focus solely on addressing Defendants’ arguments regarding statutes of limitations
(“SOL”) differences between states. Dkt. No. 159 at 11. Accepting as true Plaintiffs’ argument
that the states’ SOL differences do not pose a serious obstacle for establishing predominance, a
choice-of-law analysis for substantive contract law is still warranted. Courts in New Jersey have
acknowledged that substantive contract law varies between different states. See Agostino, 256
F.R.D. at 464. The second step of the inquiry for contract claims requires an analysis balancing
the five factors of the Restatement test. Id. Those factors are: (a) place of contracting, (b) place of

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negotiation of the contract, (c) place of performance, (d) location of the subject matter of the
contract, and (e) domicile, residence, nationality, place of incorporation, and place of business of
the parties. Restatement (Second) of Conflicts of Laws § 188(2).
As to (a), the place of contracting for every class member depends on the state in which
they rented their car. This weighs against applying New Jersey law for those putative class
members who rented vehicles outside of New Jersey. As to (b), to the extent that contracts were
negotiated, they were negotiated where every class member rented their car. This weighs against
applying New Jersey law to a nationwide class. As to (c), the place of performance was wherever
each car was rented. This similarly weighs against applying New Jersey law to the class. As to (d),
the car rentals were the subject matter of the contract, which again occurred wherever the cars
were rented. This weighs against applying New Jersey law. As to (e) (the domicile, residence,
nationality, place of incorporation, and place of business of the parties), this factor equally favors
Plaintiffs and Defendants. Altogether, none of the five factors weigh in favor of applying New
Jersey substantive contract law. Therefore, New Jersey contract law cannot be applied to Plaintiffs’
nationwide class as proposed, which leaves the predominance requirement unsatisfied as to this
claim.
Unjust Enrichment
Regarding Plaintiffs’ unjust enrichment claim, the Court finds unpersuasive Plaintiffs’
argument that there is no conflict between the unjust enrichment laws of different states. See
Montich, 849 F. Supp. 2d at 461 (“[I]t appears that based on the specific facts before me a conflict
may exist between New Jersey’s and California’s application of the law of unjust enrichment, and
thus, it would be necessary to turn to the second prong of the ‘most significant relationship’ test.”);
Ortiz v. Sig Sauer, Inc., No. 19-CV-1025-JL, 2023 WL 1928094, at *9-11 (D.N.H. Feb. 10, 2023)

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(providing an analysis of cases on the issue); Cruz v. Lawson Software, Inc., No. CIV 08-5900
MJD/JSM, 2010 WL 890038, at *6 (D. Minn. Jan. 5, 2010) (“Clearly, there are material conflicts
among many of the unjust enrichment laws of the various states in which putative class members
reside.”).
The second step of the analysis is again to determine which state has the “most significant
relationship” to the claim, which, for unjust enrichment claims arising from a contract, requires
the same § 188 analysis under the Restatement as that for breach of contract claims. See
Restatement (Second) Conflict of Laws § 221 (“When the enrichment was received in the course
of the performance of a contract between the parties, the law selected by application of the rules
of §§ 187-188 will presumably govern one party’s rights in restitution against the other.”).
Therefore, the result here is the same as in the breach of implied covenant of good faith and fair
dealing claim, which is that New Jersey law cannot be applied over the laws of wherever individual
class members reside or rented their cars. Therefore, predominance is not satisfied as to the unjust
enrichment claim for Plaintiffs’ proposed nationwide class due to the conflicts in laws between the
states.
Unconscionability
Regarding Plaintiffs’ unconscionability claim, the Court notes that neither party offers a
sufficient conflict of laws analysis. However, in conducting its own analysis, the Court finds that
there is a conflict between the laws of different states. See Romero v. Allstate Ins. Co., 52 F. Supp.
3d 715, 734 (E.D. Pa. 2014) (“[T]here is variation among the states’ laws and . . . some states only
require either substantive or procedural unconscionability while others require both substantive
and procedural unconscionability. This distinction alone is enough to make certification on a

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limited issue (one that would not even finally resolve the unconscionability question)
unworkable.”).
As with the breach of implied covenant of good faith and fair dealing and unjust enrichment
claims, the second step of the analysis requires a § 188 analysis, which weighs against applying
New Jersey law to the entire class. Therefore, the Court finds that predominance is defeated as to
the unconscionability claim as well.
Certifying a Subclass of Preferred Members
While the Court declines to find that predominance is met for Plaintiffs’ proposed
nationwide class, the Court nevertheless will sua sponte certify a subclass consisting of nationwide
Avis Preferred and Budget Fastbreak members (the “Preferred Members Subclass”) with Valli as
Class Representative because the Court finds that predominance and, as stated elsewhere in this
Opinion, the other class certification requirements are met as to this Subclass.2 The parties do not
dispute that there are no choice-of-law issues as to the Preferred Members Subclass because the
members of the Avis Preferred/Budget Fastbreak programs all have choice-of-law provisions in
their contracts, unlike in the contracts of non-preferred customers. See Dkt. No. 191 at 14:20-15:7.
Such choice-of-law provisions mandate that New Jersey law applies to all claims asserted against
Defendants regarding the Rental Agreement. See id. at 10:16-21, 15:18-25.
While Defendants assert there are still predominance issues with respect to proximate
causation and damages, the Court is not persuaded these purportedly individualized issues
outweigh the efficiencies gained by class resolution of the common issues. See Prudential I, 962
F. Supp. at 510–11. Defendants argue that individual issues predominate because each proposed

The Court notes that district courts generally enjoy broad discretion “to assess the propriety of the class and ha[ve]
the ability, pursuant to Rule 23(c)(4)(B), to alter or modify the class, create subclasses, and decertify the class
whenever warranted.” Sumitomo Copper Litig. v. Credit Lyonnais Rouse, Ltd., 262 F.3d 134, 139 (2d Cir. 2001).
2

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class member must prove they are innocent of the alleged violation, suffered damages, and cannot
prove that ABG was the proximate cause of harm. In response, Plaintiffs urge that these arguments
wholly ignore[] that ABG was not authorized to charge Plaintiffs[] and
proposed Class Members[] based only on an allegation of a violation.
Whether Plaintiffs or proposed Class Members might have been found
guilty of the underlying ticket if they had the opportunity to challenge the
allegation is irrelevant. The common harm — the unauthorized charges —
was the same for each Class Member and was proximately related to ABG’s
corporate misconduct.
Dkt. No. 159 at 14 (citations omitted). The Court agrees with Plaintiffs’ reasoning that Defendants
focus too narrowly on each proposed class member’s defense to an allegation of a violation when
Plaintiffs are seeking to hold Defendants liable for purported misrepresentations that disallowed
customers the opportunity to challenge such allegations of violations.
The Court is similarly not persuaded by Defendants’ argument that predominance cannot
be met because fifty-two percent of the proposed Class purportedly knew how the ticket process
worked, paid Defendants for the violation, and then rented again from ABG, which Defendants
asserts means these individuals “knew exactly how the violation process worked, did not care, and
continued renting from Avis/Budget.” Dkt. No. 153 at 33. As noted by Plaintiffs, ABG offers no
evidence of such “knowledge” or indifference, and the Court is not persuaded that Defendants’
policy of automatically billing a customer’s credit card on file if they did not proffer another means
of paying the fine and fee equates to knowledge of and ambivalence to the ticket process. The
Court further agrees with Plaintiffs that there could be a “plethora of reasons why a Class Member
might have rented again from ABG.” Dkt. No. 159 at p. 14-15. Regardless, the Court finds such
argument does not defeat predominance for the Preferred Members Subclass.3

3

The Court notes that while it has the discretion to create a subclass and has elected to do so as to the Preferred
Members Subclass who are all subject to the same choice-of-law provision in their rental agreements, such discretion
should not and will not be applied to a subclass for New Jersey-based non-preferred rental car customers. This is
because neither Valli nor Dubinsky have standing to serve as Lead Plaintiffs for such a proposed subclass since neither

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Accordingly, while the Court declines to find that predominance is met for Plaintiffs’
proposed nationwide class based on choice-of-law queries predominating over common questions,
the Court will sua sponte certify the Preferred Members Subclass, finding that predominance is
met as to this Subclass. The Court now turns to the remaining class certification requirements,
which it finds are satisfied as to both the proposed nationwide class and the ultimately certified
Preferred Members Subclass.
C. Typicality
Typicality is satisfied when “the claims or defenses of the representative parties are typical
of the claims or defenses of the class.” Fed. R. Civ. P. 23(a)(3). “Typicality lies where there is a
strong similarity of legal theories or where the claims of the class representatives and the class
members arise from the same alleged course of conduct by the defendant.” Mendez, 2017 WL
5513691, at *4 (quoting Prudential I, 962 F. Supp. at 518). A court may find typicality even where
there are factual differences between the claims of the class representatives and the claims of other
class members. Id.; see also In re Schering Plough Corp. ERISA Litig., 589 F.3d 585, 597 (3d Cir.
2009).
Defendants argue that Plaintiffs have failed to satisfy the typicality requirement for three
reasons: (1) Plaintiffs’ claims are subject to unique factual defenses not applicable to the class as
a whole; (2) Plaintiffs’ proposed class includes members who cannot be joined in this action
because they agreed to waive participation in any class action and instead submit their claims to

Valli nor Dubinsky are residents of New Jersey, nor did they rent their vehicles from Defendants in New Jersey.
However, unlike for Plaintiffs’ proposed nationwide class, the Court finds that the choice-of-law query, the sole issue
which the Court finds destroys predominance (and therefore class certification), would not defeat predominance for a
subclass of New Jersey residents. This is because an individualized analysis as to each proposed class member would
not be necessary for this subclass; instead, the Court finds that the balance of the Restatement factors enumerated
above for each of Plaintiff’s four proposed claims would weigh in favor of applying New Jersey law to a subclass of
customers who reside in New Jersey and/or contracted to rent cars from Defendants in New Jersey.

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binding bilateral arbitration; and (3) Plaintiffs’ claims are not typical of claims relating to tolls and
parking tickets.
The Court is not persuaded by Defendants’ arguments and finds that Plaintiffs have
satisfied the typicality requirement. Both Plaintiffs and the Proposed Class Members’ claims arise
from the same core practice and course of conduct, namely Defendants’ policy of charging renters’
credit cards for alleged violations plus an administrative fee without the opportunity to contest the
fee. See HoxworthBlinder, Robinson & Co., Inc., 980 F.2d 912, 923 (3d Cir. 1992); Dkt. No. 147
at 19. Additionally, the claims between Plaintiffs and the Proposed Class Members stem from
similar factual circumstances: Valli and Dubinsky were renters of an Avis or Budget vehicle which
was the subject of an alleged parking or traffic violation, the ticket was sent directly to Defendants,
and Defendants charged the renter for the fine and administrative fee. Dkt. No. 147 at 6-8; see also
Mendez, 2017 U.S. Dist. LEXIS 190730, at *17-18 (noting a common core of facts among renters
who rented from a specific company, were subject to a standardized contract, and were charged
by the defendant for resulting e-Toll fees and upcharges); Agostino, 256 F.R.D. 437 at 478
(denying typicality in part based on different factual circumstances between the Subclass seeking
monetary damages for bills they had paid versus the lead plaintiff who had not paid any portion of
the bills she received).
Further support of a common practice by Defendants comes from statements by ABG’s
Vice President, who noted it was standard corporate practice to “pay ticket and bill customer,” and
ABG’s Manager of Field Operations, J. Geib, who testified that “nationwide, the rental agreement
is standard. There are a handful of variations for a handful of states, but the variations in language
do not apply to the citations items, and the preferred terms and conditions are universal.” Dkt. No.
148, Declaration of Joel B. Strauss, Submitted in Support of Plaintiffs’ Motion for Class

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Certification (“Strauss Decl.”), Ex. V at ABCR00397637; Strauss Decl., Ex. W at 125:21-126:22
(“Geib Dep.”). Geib also confirmed that this universal language remained the same from 2008 to
the present. Geib Dep. at 125:21-126:22.
Defendants’ argument regarding differences in parking violations and moving violations is
likewise unpersuasive. As Plaintiffs point out, the proposed class only includes those “who rented
an Avis or Budget brand vehicle during the Class Period and whose rented vehicle was the subject
of an alleged parking, traffic, toll or other violation, where: (1) the ticket issuing authority sent
notice of the ticket directly to ABG. . . .” Dkt. No. 146-1 (emphasis added); see also Dkt. No. 159
at 7. This language explicitly excludes those who were put on immediate notice by the physical
ticket placed on the vehicle, thereby eliminating potential differences between the lead Plaintiffs
and putative class members.
Although the variances between tolling violations and other citations represent factual
differences, typicality is likely not destroyed. Typicality does not require that all proposed class
members share identical claims. See Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 259
F.3d 154, 184 (3d Cir. 2001); see also Hassine v. Jeffes, 846 F.2d 169, 176-77 (3d Cir. 1988).
Rather, “even relatively pronounced factual differences will generally not preclude a finding of
typicality where there is a strong similarity of legal theories.” Neal v. Casey, 43 F.3d 48, 58 (3d
Cir. 1994). Specifically, courts within the Third Circuit have held that "[i]f the claims of the named
plaintiffs and putative class members involve the same conduct by the defendant, typicality is
established . . . .” Newton, 259 F.3d 154 at 183-84.
Turning to Defendants’ argument regarding the arbitration clause, Defendants also argue
typicality is not met because Plaintiffs’ proposed class includes members who cannot be joined in
this action because they agreed to waive participation in any class action and instead submit their

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claims to binding arbitration. Dkt. No. 153 at 36. Defendants cite two cases to support their
position: Jensen v. Cablevision Sys. Corp., and Tan v. Grubhub. Id. at 36-37 (citing Jensen v.
Cablevision Sys. Corp., 372 F. Supp. 3d 95, 123 (E.D.N.Y. 2019) (holding that even the mere
possibility of the arbitration provision being valid is sufficient to disqualify a named plaintiff who
declined the provision from representing a class predominately comprised of individuals
potentially subject to the agreement); Tan v. Grubhub, Inc., No. 15-CV-05128, 2016 WL 4721439,
at *3 (N.D. Cal. July 19, 2016) (holding that a named plaintiff who has opted out of an arbitration
and class action provision cannot satisfy the typicality requirements of Rule 23, as her claims are
not typical of the class members who did not opt-out and are thus subject to the arbitration and
class action waiver provisions)).
Additionally, Defendants suggest that their rental agreements began incorporating
arbitration provisions from September 30, 2008 to the present. Dkt. No. 153 at 37. These
provisions mandate that all disputes related to the rental be settled through binding bilateral
arbitration. Id. This change was also allegedly implemented in the Avis Preferred and Budget
FastBreak rental agreements. Id. Defendants aver that these arbitration provisions apply to a
significant number of the proposed class members. Hence, Defendants assert that Dubinsky and
Valli, who did not agree to such arbitration for their claims against Defendants, are not typical of
the proposed class members who did. Id.
Plaintiffs challenge Defendants’ argument regarding arbitration, citing the lack of any
evidence provided by Defendants proving that the proposed class members agreed to an arbitration
clause, a point Plaintiffs assert is corroborated by the ruling in James v. Glob. Tel*Link Corp. Dkt.
No. 159 at 5 (citing James v. Glob. Tel*Link Corp., 2016 WL 589676, at *3 (D.N.J. Feb. 11, 2016)
(holding that the plaintiff, having been duly presented with and consenting to the terms of use,

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which included an arbitration agreement, is obligated to arbitrate her claims against the defendant),
aff’d, 852 F.3d 262 (3d Cir. 2017)). Plaintiffs emphasize that Defendants’ argument predominantly
rests on a declaration by C. Harp, who claims that ABG rental agreements and Avis Preferred and
Budget FastBreak Agreements have incorporated arbitration provisions since 2008 without
providing any supporting documentation. Id. (citing Dkt. No. 153-20, Declaration of Corey Harp,
Submitted in Support of Defendants’ Opposition to Plaintiffs’ Motion for Class Certification
(“Harp Decl.”) at ¶ 11). Plaintiffs further note that “the Declaration of J. Geib states that Plaintiff
Valli’s 2014 rental was subject to Avis’ Preferred Agreement, [but] that Agreement lacks any such
provision.” Id. (citing Geib Decl. at ¶ 8).
Furthermore, Plaintiffs claim that the two out-of-circuit cases referenced by Defendants
are irrelevant to the current case, as the arbitration provision in Jensen v. Cablevision Sys. Corp.
encompassed 99% of the class, and in Tan v. Grubhub, Inc., the plaintiff was just one of two
individuals in California to opt-out of the class action waiver. Id. at 6 n.7 (citing Jensen, 372 F.
Supp. 3d at 124 (“[T]he existence of an arbitration provision that potentially involves over 99
percent of the proposed class impacts the typicality of the Plaintiff's claim.”); Tan, 2016 WL
4721439, at *3 (“[The Plaintiff] is one of just two individuals in California to opt out of the class
action waiver provisions. All other GrubHub drivers in California are potentially subject to some
form of class action waiver as set forth in the GrubHub service agreements.”)). Plaintiffs argue
that these cases are distinct as there is no evidence of an arbitration provision in the present case,
thus negating any need for potential class members to opt-out. Id.
Plaintiffs further assert that even if an arbitration agreement bound some of the proposed
class members, ABG has waived its right to arbitrate any claim. Id. As support, Plaintiffs note that
“ABG has fully participated in the litigation and vigorously contested its merits for five years

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without ever moving to arbitrate (or stating an intent to seek arbitration) until now.” Id. (citing
Maher v. Northland Grp., Inc., No. CV172957KMJBC, 2019 WL 3245083, at *10 (D.N.J. July
19, 2019) (holding that a delay of twenty-two months in bringing the motion to compel arbitration
was substantial and therefore denying the defendant’s motion to compel arbitration)).
Plaintiffs more recently during oral argument asserted an additional argument, stating that
“the arbitration clause doesn’t bind these plaintiffs because, by its very terms, the claims that each
and every one of the class members assert would be subject to a jurisdiction of a small claims
court’s authority.” Dkt. No. 191 at 8:17-21. Plaintiffs believe that because all the claims are small
in nature, with the largest being around $500, they would all be within the jurisdiction of a small
claims court, and therefore the arbitration clause is not binding. Id. at 7:20-22.
While the Court is persuaded that an arbitration agreement did exist in the applicable Rental
Agreements, and indeed, Plaintiffs seem to have conceded this point during oral argument, see
Dkt. No. 191 at 7:13-7:16, it appears to the Court that Defendants may have waived their right to
arbitration. Through their conscious decision to engage in litigation despite an existing arbitration
agreement, litigants may consequently forfeit their right to arbitration. See White v. Samsung Elecs.
Am., Inc., 61 F.4th 334, 341 (3d Cir. 2023). In White, a group of consumers brought a class action
against a television manufacturer. Id. at 336. In response, the manufacturer moved to enforce
arbitration; however, this Court dismissed the manufacturer’s motion, and the manufacturer
appealed. Id. at 338. The Third Circuit clarified that a waiver occurs when a party deliberately
abandons an acknowledged right, and determining whether such abandonment occurred rests on
examining the actions of the party in possession of the right within the specific circumstances of
each case. Id. at 340. The Third Circuit held that the manufacturer had effectively waived its right
to arbitration as a result of the manufacturer’s apparent preference for litigation over arbitration.

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Id. at 341. Notably, the manufacturer had been aware since 2018 that the plaintiffs had consented
to arbitration, yet it did not assert its right to arbitration before the district court until May 2020.
Id. Therefore, the manufacturer demonstrated a strategic choice to enjoy the benefits of litigation,
which was inconsistent with an intent to arbitrate, leading to the conclusion that it had effectively
waived its arbitration rights. Id.
In light of the White decision, the Court finds that Defendants have waived their right to
arbitration in this case. Here, Defendants engaged fully in the litigation for five years without ever
moving to arbitrate. Dkt. No. 159 at 6. The present situation is in contrast with White, where the
defendant postponed moving to arbitrate for only two years, yet the Third Circuit still held that the
defendant had waived its arbitration rights. Defendants’ behavior in the instant matter mirrors that
observed in White, where the defendant leveraged the ongoing litigation until it became beneficial
to mention arbitration.
In light of the foregoing, the Court finds that Plaintiffs have satisfied the typicality
requirement under Rule 23(a)(3).
D. Adequacy of Representation
Adequacy is satisfied when “the representative parties will fairly and adequately protect
the interests of the class.” Fed. R. Civ. P. 23(a)(4). “Courts look at two factors: ‘(1) the plaintiff’s
attorney must be qualified, experienced, and generally able to conduct the proposed litigation, and
(2) the plaintiff must not have interests antagonistic to those of the class.’” Mendez, 2017 WL
5513691, at *6 (quoting Prudential I, 962 F. Supp. at 519).
Regarding the adequacy requirement, Plaintiffs state they have retained counsel with
“substantial experience” litigating consumer class actions and other complex litigation who have
devoted a significant amount of time and resources to this case. Dkt. No. 147 at 19-20. Regarding

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the adequacy of Valli as Lead Plaintiff,4 Plaintiffs assert there are no conflicts of interest, and that
Valli is committed to “vigorously” prosecuting the case on behalf of all class members. Id. at 21.
To support this assertion, Plaintiffs note that in the last five years, Valli has responded to thirtyseven requests for production of documents, twenty-seven requests for admission, and has verified
more than forty-three interrogatory responses. Id. Based on the foregoing, the Court finds that the
adequacy requirement under Rule 23(a)(4) is satisfied.
E. Superiority
Superiority is the other requirement of a Rule 23(b)(3) class action, in addition to
predominance. Rule 23(b)(3) provides courts with four non-exclusive factors to analyze
superiority:
(1) the interest of individual members of the class in individually controlling
the prosecution of the action; (2) the extent of litigation commenced
elsewhere by class members; (3) the desirability of concentrating claims in
a given forum; and (4) the management difficulties likely to be encountered
in pursuing the class action.
Mendez, 2017 WL 5513691, at *6 (citing Prudential I, 962 F. Supp. at 522).
Plaintiffs argue that superiority is satisfied based on the fact that a class action is essentially
the only viable avenue for the putative class members, because it would be too expensive for any
individual member to sue on their own. Dkt. No. 147 at 34-35. In response, Defendants argue that
superiority is not satisfied because the claims are so individualized that it would be unfair to defend
them all in one action. Defendants also claim that the class sought to be certified here has already
been certified in Mendez. Dkt. No. 153 at 39-40. The Court will address Defendants’ latter
argument first.

While Plaintiffs’ briefing also addresses the adequacy of Dubinsky as Lead Plaintiff, the Court will not include him
in its analysis on adequacy based on the Court finding supra that Dubinsky does not have standing to act as Lead
Plaintiff for the Preferred Members Subclass, the sole class that the Court will be certifying in the instant Opinion.
4

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In Mendez, the court certified a nationwide class related to purported dishonest business
practices regarding the e-Toll service fee and toll upcharges. Mendez, 2017 WL 5513691, at *1.
The Court finds that the purported class here differs from the class approved in Mendez, as
Plaintiffs in the instant case seek to certify a class of customers “who rented an Avis or Budget
brand vehicle during the Class Period and whose rented vehicle was the subject of an alleged
parking, traffic, toll or other violation, where: (1) the ticket issuing authority sent notice of the
ticket directly to ABG . . . .” Dkt. No. 146-1 (emphasis added). There is no reference to the e-Toll
system in the instant case. Additionally, in Mendez, there is no indication that the customers
committed toll violations; instead, the class complained of upcharges regarding automatic toll
payments. Thus, the Court finds the proposed class here sufficiently different than that certified in
Mendez.
Turning to the assessment of the four non-exclusive factors set forth in Rule 23(b)(3), in
Mendez the court found the four factors were met and superiority was satisfied because (1) the
claims of each class member were relatively small, which meant that few members would be able
to bring claims absent the class action; and (2) few class members would be able to pursue
litigation on their own, because their recoveries would be less than the cost of litigating; 2017 WL
5513691, at *6. The Court likewise finds that the four factors are satisfied here. As in Mendez, the
claims of each proposed class member in this matter are very small, in amounts that come from
minor traffic violations. Further, it would be prohibitively expensive to litigate this issue for any
individual person. Therefore, based on the reasoning in Mendez, the Court finds that Plaintiffs have
satisfied the superiority requirement.

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IV.

CONCLUSION
For the foregoing reasons, Plaintiffs’ motion for class certification [Dkt. No. 146] is

DENIED as to the Plaintiffs’ proposed nationwide class and GRANTED as to a Preferred
Members Subclass created at the Court’s discretion pursuant to Rule 23(c)(4)(B). An
appropriate Order, which includes the definition for the above-approved Preferred Members
Subclass, accompanies this Opinion.

s/ James B. Clark, III
JAMES B. CLARK, III
United States Magistrate Judge

27