KAUSAR v. GC SERVICES LIMITED PARTNERSHIP

Filing 86

OPINION. Signed by Judge Esther Salas on 9/27/2018. (JB, )

Not for Publication
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

RUKHSANA KAUSAR, on behalf of
herself and others similarly situated,
Plaintiff,
v.
GC SERVICES LIMITED
PARTNERSHIP,
Defendant.

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Civil Action No. 15-6027 (ES) (JAD)
OPINION

SALAS, DISTRICT JUDGE
Pending before the Court are (i) Defendant GC Limited Partnership’s (“GC”) motion to
dismiss and compel arbitration or, alternatively, to stay this action pending arbitration under
Federal Rule of Civil Procedure 12(b)(1) (D.E. No. 72)1 and (ii) Plaintiff Rukhsana Kausar’s
motion for class certification (D.E. No. 59). The Court has considered the parties’ submissions
and decides these matters without oral argument. See Fed. R. Civ. P. 78(b). For the following
reasons, the Court DENIES GC’s motion to compel arbitration and GRANTS Kausar’s motion for
class certification.
I.

Background
In February 2015, Kausar allegedly incurred a debt in connection with a Brooks Brothers

credit card issued by Synchrony Bank. (D.E. No. 1, Compl. ¶¶ 13-14). Kausar alleges that
Synchrony Bank “assigned, placed or transferred” her debt to GC for collection. (Id. ¶ 16). This
case concerns the debt-collection letter GC sent Kausar and others similarly situated.

1

For simplicity, the Court will refer to GC’s motion as a motion to compel arbitration.

In particular, Kausar alleges that GC’s debt-collection letter violated the Fair Debt
Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., by failing to communicate per
§§ 1692g(a)(4)-(5) that requests to verify the debt, or to obtain the original creditor’s name and
address, must be in writing. (See, e.g., id. ¶ 36). Kausar also alleges that GC’s letter constituted
“a false representation or deceptive means to collect or attempt to collect any debt or to obtain
information concerning a consumer” in violation of § 1692e(10). (Id. ¶ 46).
II.

GC’s Motion to Compel Arbitration
A. Law
The Federal Arbitration Act (“FAA”) “creates a body of federal substantive law

establishing and governing the duty to honor agreements to arbitrate disputes.” Century Indem.
Co. v. Certain Underwriters at Lloyd’s, London, 584 F.3d 513, 522 (3d Cir. 2009). “Congress
designed the FAA to overrule the judiciary’s longstanding reluctance to enforce agreements to
arbitrate and its refusal to put such agreements on the same footing as other contracts.” Id. “There
is a strong federal policy in favor of arbitration, and a party to a valid and enforceable arbitration
agreement is entitled to a stay of federal court proceedings pending arbitration as well as an order
compelling such arbitration.” In re Pharmacy Benefit Managers Antitrust Litig., 700 F.3d 109,
116 (3d Cir. 2012).
But a court may refuse to enforce an arbitration agreement where the party seeking
arbitration waives its right to arbitrate. Nino v. Jewelry Exch., Inc., 609 F.3d 191, 208 (3d Cir.
2010). This occurs, for example, when the “party has acted inconsistently with the right to
arbitrate.” Id. “Prejudice is the touchstone for determining whether the right to arbitrate has been
waived by litigation conduct.” In re Pharmacy, 700 F.3d at 118; see also Nino, 609 F.3d at 208
(“[W]e will not hesitate to hold that the right to arbitrate has been waived where a sufficient
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showing of prejudice has been made by the party seeking to avoid arbitration.”). The Third Circuit
has held that such prejudice includes not only “substantive prejudice to the legal position of the
party claiming waiver,” but also “prejudice resulting from the unnecessary delay and expense
incurred by the plaintiffs as a result of the defendants’ belated invocation of their right to arbitrate.”
Nino, 609 F.3d at 209 (citation and internal quotation marks omitted). To be sure, “[c]onsistent
with the strong preference for arbitration in federal courts, waiver is not to be lightly inferred, and
waiver will normally be found only where the demand for arbitration came long after the suit
commenced and when both parties had engaged in discovery.” PaineWebber Inc. v. Faragalli, 61
F.3d 1063, 1068-69 (3d Cir. 1995) (internal citations and quotation marks omitted).
To determine whether a party has waived its right to arbitrate, courts in the Third Circuit
consider six non-exclusive factors: (1) the timeliness of the motion to arbitrate; (2) the degree to
which the party seeking to compel arbitration has contested the merits of its opponent’s claims;
(3) whether the party has informed its adversary of the intention to seek arbitration even if it has
not yet filed a motion to stay the district court proceedings; (4) the extent of its non-merits motion
practice; (5) its assent to the district court’s pretrial orders; and (6) the extent to which both parties
have engaged in discovery. Hoxworth v. Blinder, Robinson & Co., 980 F.2d 912, 926-27 (3d Cir.
1991). “Not all the factors need to be present to justify a finding of waiver.” Nino, 609 F.3d at
209. Instead, “the waiver determination must be based on the circumstances and context of the
particular case.” Id. (internal quotation marks omitted). “[W]aiver of the right to arbitrate based
on litigation remains presumptively an issue for the court to decide.” Ehleiter v. Grapetree Shores,
Inc., 482 F.3d 207, 221 (3d Cir. 2007).

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B. Analysis
i.

The Timeliness of GC’s Motion to Compel Arbitration

The first Hoxworth factor considers whether the moving party moved to compel arbitration
on a timely basis. 980 F.2d at 926-27. Kausar filed her Complaint on August 5, 2015. GC first
notified the Court of its intention to move to compel arbitration on August 10, 2017. (D.E. No.
48). GC therefore delayed seeking arbitration for over two years. See In re Pharmacy, 700 F.3d
at 118 (calculating delay from the complaint’s filing date); Serine v. Marshall, Dennehey, Warner,
Coleman & Goggin, No. 14-4868, 2015 WL 4644129, at *3 (E.D. Pa. Aug. 5, 2015) (“The Court
finds no support in the caselaw for measuring timeliness from anything other than the filing of the
Complaint.”).
GC’s twenty-four-month delay is even longer than the delays in cases where the Third
Circuit found waiver. See, e.g., SuperMedia v. Affordable Elec., Inc., 565 F. App’x 144, 147 (3d
Cir. 2014) (eleven-month delay); In re Pharmacy, 700 F.3d at 118 (ten-month delay); Nino, 609
F.3d at 210 (fifteen-month delay); Hoxworth, 980 F.2d at 925 (eleven-month delay). And GC’s
delay far exceeds the delays in cases where the Third Circuit found no waiver. See, e.g., Palcko
v. Airborne Express, Inc., 372 F.3d 588, 598 (3d Cir. 2004) (thirty-eight-day delay); Wood v.
Prudential Ins. Co. of America, 207 F.3d 674, 680 (3d Cir. 2000) (one-and-a-half-month delay);
Faragalli, 61 F.3d at 1069 (two-month delay). The Court is mindful, however, that “the length of
the time period involved alone is not determinative.” Zimmer v. CooperNeff Advisors, Inc., 523
F.3d 224, 232 (3d Cir. 2008).
GC offers an explanation for its delay. GC says it “filed its answer to this lawsuit on
September 15, 2015” and “[f]rom shortly after September 15, 2015 until April 04, 2017, [GC] was
requesting that Synchrony Bank confirm the existence of, and provide a copy, of the Plaintiff’s
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arbitration agreement.” (D.E. No. 85 at 10). GC claims it “could not raise the existence of the
arbitration agreement in its Answer or in status conferences prior to verifying its existence on April
04, 2017.” (Id.).
The Court finds GC’s explanation unpersuasive. For one, GC does not explain what it
means by “confirm the existence of the arbitration agreement.” The arbitration agreement is in
Kausar’s credit-card agreement, which is the same credit-card agreement GC says it relied on to
collect Kausar’s debt. (See D.E. No. 72 at 11) (“Synchrony assigned Plaintiff’s account with [GC]
for collection on Synchrony’s behalf under the terms of Plaintiff’s credit card agreement.”)
(emphasis added). And GC acknowledges that, from the start of this litigation, it suspected an
arbitration agreement existed—GC says it filed an Answer and “shortly after” started asking
Synchrony Bank to confirm the existence of Kausar’s arbitration agreement. (D.E. No. 85 at 10).
The Third Circuit has rejected a similar argument where a defendant complained about its inability
to locate the applicable contract, pointing out that the defendant could have sought the agreement,
or information about the agreement, through discovery. See Nino, 609 F.3d at 210.
More to the point, had GC informed the Court about a potential arbitration agreement, the
Court could have stayed the proceedings or otherwise managed this case in a way that would not
have significantly prejudiced Kausar. Instead, GC chose silence, and its “belated invocation of
[its alleged] right to arbitrate” caused Kausar significant “prejudice resulting from the unnecessary
delay and expense” of litigating in this forum. See Nino, 609 F.3d at 209. After all, “prejudice is
the touchstone for determining whether the right to arbitrate has been waived by litigation
conduct.” Zimmer, 523 F.3d at 231. The Court therefore finds that the first Hoxworth factor
strongly favors waiver.

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ii.

Whether GC Contested the Merits of Kausar’s Claims

The second Hoxworth factor asks whether the moving party contested the merits of the
plaintiff’s claims. 980 F.2d at 926-27. Before raising the issue of arbitration, GC twice moved
under Federal Rule of Civil Procedure 12(b)(1) to dismiss Kausar’s Complaint for lack of subjectmatter jurisdiction (D.E. Nos. 24 & 44)2 and twice opposed Kausar’s previous motions for class
certification (D.E. Nos. 27 & 37). GC argues that its Rule 12(b)(1) motions did not challenge the
merits of Kausar’s claims because they addressed “only the issue of Kausar’s standing and, thus,
the Court’s subject matter jurisdiction.” (D.E. No. 85 at 11). In opposition, Kausar does not
explicitly say that GC’s Rule 12(b)(1) motions challenged the merits; rather, she characterizes
GC’s motions as “dispositive” and explains that her “entire case would have been dismissed by
this Court” if the motions prevailed. (See D.E. No. 82 at 24) (emphasis in original). GC does not
address its opposition to Kausar’s motions for class certification.
The Court agrees with GC that its Rule 12(b)(1) motions did not challenge the merits of
Kausar’s claims. As GC correctly points out, this Court construed GC’s motion as a “facial attack”
because it did not “challenge the validity of Plaintiff’s factual claims.” (D.E. No. 85 at 11-12)
(citing D.E. No. 52 at 3). Similarly, GC’s oppositions to Kausar’s motions for class certification
primarily address whether Kausar has standing and whether she satisfied the requirements for class
certification—not whether her claims are meritorious.3 (See D.E. Nos. 27 & 37). On the whole,
the second Hoxworth factor weighs against waiver.

The Court administratively terminated GC’s first Rule 12(b)(1) motion so that the parties could address
supplemental authority in their briefs (D.E. No. 34), and the Court denied GC’s second Rule 12(b)(1) motion in an
Opinion and Order (D.E. Nos. 52 & 53).
2

GC’s opposition to class certification is not entirely silent on the merits of Kausar’s claims. (See, e.g., D.E.
No. 73 at 3) (“Plaintiff filed suit on August 5, 2015, alleging, albeit inaccurately, that the letter misstated the method
for requesting verification of the debt or the name and address of the original creditor.”) (emphasis added). But these
references to the merits are merely passing.
3

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iii.

Whether GC Informed Kausar of its Intention to Seek Arbitration

The third Hoxworth factor asks whether the moving party “has informed its adversary of
the intention to seek arbitration even if it has not yet filed a motion to stay the district court
proceedings.” 980 F.2d at 926-27. The parties do not dispute that GC first notified Kausar on
April 4, 2017. (See D.E. No. 82 at 25; D.E. No. 85 at 10). GC explains that it notified Kausar’s
counsel “the same day defense counsel confirmed [GC’s] right to arbitrate.” (D.E. No. 85 at 10).
Kausar, however, points out that GC (i) did not raise arbitration as one of its affirmative defenses
in its Answer; (ii) did not raise arbitration in the joint discovery plan, “which specifically contains
a section for anticipated motions”; and (iii) never raised arbitration “in any of the status
conferences with Judge Dickson, in their responses to Plaintiff’s discovery demands, or at any
other time” before April 4, 2017. (D.E. No. 82 at 25). Kausar also notes that GC filed its second
Rule 12(b)(1) motion after it notified her—but before it notified the Court—of its intention to seek
arbitration. (Id.).
This factor is neutral. GC notified Kausar of its intention to arbitrate four months before
it raised the issue with the Court. Thus, GC put Kausar on notice well before it moved to compel
arbitration. And Kausar’s reliance on In re Pharmacy and Gray Holdco is inapposite because the
moving party in those cases provided no notice at all. (D.E. No. 82 at 25-26) (citing 700 F.3d at
118-19 and Gray Holdco, Inc. v. Cassady, 654 F.3d 444, 457 (3d Cir. 2011)). But GC could have
provided notice much sooner—from the start of this litigation, it suspected an arbitration
agreement existed. What’s more, GC filed a Rule 12(b)(1) motion after notifying Kausar of its
intention to seek arbitration. That litigation decision is “inconsistent[] with the right to arbitrate.”
Nino, 609 F.3d at 208.

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iv.

Extent of GC’s Non-Merits Motion Practice

The fourth Hoxworth factor considers the extent to which the moving party engaged in
non-merits motion practice. 980 F.2d at 926-27. As discussed above, GC twice moved to dismiss
under Rule 12(b)(1) and twice opposed Kausar’s motions for class certification. In fact, GC filed
its second Rule 12(b)(1) motion after it notified Kausar of its intention to seek arbitration. Kausar
also highlights two discovery disputes that required Magistrate Judge Dickson’s intervention (D.E.
No. 82 at 25), one of which required Kausar to submit two letters to the Court (D.E. Nos. 62 &
65). All this motion practice occurred while GC suspected an arbitration agreement existed. This
factor strongly favors waiver.
v.

GC’s Assent to the Court’s Pretrial Orders

The fifth Hoxworth factor considers the moving party’s assent to the court’s pretrial orders.
980 F.2d at 926-27. Kausar argues this factor “weighs heavily in favor of waiver because [GC]
has complied and acquiesced to all of this Court’s numerous pretrial orders throughout the duration
of this case.” (D.E. No. 82 at 27) (emphasis in original). GC does not dispute that it has complied
with the Court’s pretrial orders, but rather argues it is “unreasonable” to expect it not to comply
“when it was not able to confirm the existence of Plaintiff’s arbitration agreement.” (D.E. No. 85
at 12). And GC contends that “as soon as [it] was able to confirm the existence of Plaintiff’s
arbitration agreement, [it] made Kausar and the Court aware that it would seek to compel
arbitration.” (Id.).
The Court agrees with Kausar. First, GC cites no authority in support of its argument.
Second, GC did not make the Court aware of its intention to compel arbitration as soon as it
“confirmed the existence” of Kausar’s agreement—it notified Kausar, then waited four months

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before notifying the Court. And during that time, GC filed a Rule 12(b)(1) motion pursuant to the
Court’s January 4, 2017 Order. (D.E. Nos. 44 & 34). This factor favors waiver.
vi.

Extent to Which Both Parties Engaged in Discovery

The sixth Hoxworth factor considers the extent to which both parties have engaged in
discovery. 980 F.2d at 926-27. Kausar describes the discovery thus far as “significant.” (D.E.
No. 82 at 28). She says the parties have “submitted interrogatories and responses to one another,
produced documents, and completed all fact discovery.” (Id.). She also points out that she twice
had to seek Magistrate Judge Dickson’s intervention to compel GC to turn over certain discovery
materials. (Id.). GC acknowledges that “some discovery was exchanged long before [it] was able
to confirm the existence of Plaintiff’s arbitration agreement.” (D.E. No. 85 at 13). But after it
notified the Court of its intention to seek arbitration, it “did not promulgate any discovery or
participate by responding to any significant discovery.” (Id.). GC also notes that neither party has
taken a deposition. (Id. at 14).
For the reasons discussed throughout this analysis, GC’s attempts to minimize the
relevance of its conduct before it “confirmed the existence of the arbitration agreement” fall flat.
GC could have raised the issue of arbitration and the Court could have, among other things, stayed
the proceedings, which would have eliminated or at least reduced significant discovery burdens
until the arbitration issue was resolved. Instead, GC remained silent and the parties exchanged
interrogatories, produced documents, and completed fact discovery with respect to class
certification—conduct that is “by no means de minimis.” See Nino, 609 F.3d at 213. This factor
also favors waiver.

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vii.

Conclusion

The Court is mindful that waiver is “not to be lightly inferred.” Id. at 208. And the Court
recognizes that “any doubts concerning the scope of arbitrable issues should be resolved in favor
of arbitration,” including issues such as “waiver, delay, or a like defense to arbitrability.” Moses
H. Cohen Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983). Yet the Court is
compelled to find that, “based on the circumstances and context” of this case, GC waived any right
it may have had to arbitrate. See Nino, 609 F.3d at 209. Taken together, the Hoxworth factors
establish “prejudice resulting from the unnecessary delay and expense incurred by [Kausar] as a
result of [GC’s] belated invocation of [its] right to arbitrate.” Id. The Court therefore denies GC’s
motion to compel arbitration.4
III.

Kausar’s Motion for Class Certification
A. Law
“The class action is an exception to the usual rule that litigation is conducted by and on

behalf of the individual named parties only.” Comcast Corp. v. Behrend, 569 U.S. 27, 33 (2013)
(citation omitted). A party proposing class-action certification “bears the burden of affirmatively
demonstrating by a preponderance of the evidence her compliance with the requirements of Rule
23.” Byrd v. Aaron’s Inc., 784 F.3d 154, 162 (3d Cir. 2015) (citing Comcast, 569 U.S. at 33). In
In light of the Court’s finding that GC waived any right it may have had to arbitrate, the Court need not reach
the parties’ remaining arguments about the arbitration agreement. See Hoxworth, 980 F.2d at 925 (finding waiver and
declining to address whether the nonsignator defendant could enforce the arbitration agreement); SuperMedia, 565 F.
App’x at 148 (finding waiver and declining to review the arbitration provision at issue).
The Court notes specifically that in addition to their treatment of the Hoxworth factors, the parties address
waiver of the right to arbitrate under Utah law. (See D.E. No. 82 at 29-33; D.E. No. 85 at 14-15). The parties do not
explain why they do so. (See, e.g., D.E. No. 82 at 29; D.E. No. 85 at 14). The arbitration agreement provides that
“Utah law shall apply to the extent state law is relevant under the FAA.” (D.E. No. 72-1 at 7). But, as decisions from
the Court of Appeals make clear, state law does not determine whether a party has waived its right to arbitrate in the
federal courts of this Circuit—the considerations underlying Hoxworth do. See, e.g., SuperMedia, 565 F. App’x at
147. The same is true even when there is an underlying choice of law question, as is often the case in disputes over
arbitration. See, e.g., Gavlik Constr. Co. v. H. F. Campbell Co., 526 F.2d 777, 784, 785 n.18 (3d Cir. 1975).
Accordingly, the Court need not consider the parties’ arguments under Utah law.
4

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particular, “every putative class action must satisfy the four requirements of Rule 23(a) and the
requirements of either Rule 23(b)(1), (2), or (3).” Marcus v. BMW of N. Am., LLC, 687 F.3d 583,
590 (3d Cir. 2012) (citing Fed. R. Civ. P. 23(a)-(b)).
If a party is seeking certification under Rule 23(b)(3)—like Kausar is here—that party must
first “prove by a preponderance of the evidence that the class is ascertainable.” Byrd, 784 F.3d at
163. A court evaluating a motion for class certification “is obligated to probe behind the pleadings
when necessary and conduct a ‘rigorous analysis’ in order to determine whether the Rule 23
certification requirements are satisfied.” Id. (citations omitted).
To satisfy the threshold ascertainability inquiry, the party seeking certification must show
that (1) the class is “defined with reference to objective criteria”; and (2) there is “a reliable and
administratively feasible mechanism for determining whether putative class members fall within
the class definition.” Id. (citations omitted). The ascertainability inquiry is narrow. Id. at 165. It
“does not mean that a plaintiff must be able to identify all class members at class certification;
instead, a plaintiff need only show that ‘class members can be identified.’” Id. (quoting Carrera
v. Bayer Corp., 727 F.3d 300, 308 n.2 (3d Cir. 2013)) (emphasis in original).
To satisfy Rule 23(a), the party seeking certification must show that: (1) the class is so
numerous that joinder of all members is impracticable (“numerosity”); (2) there are questions of
law or fact common to the class (“commonality”); (3) the claims or defenses of the representative
parties are typical of the claims or defenses of the class (“typicality”); and (4) the representative
parties will fairly and adequately protect the interests of the class (“adequacy”). See Marcus, 687
F.3d at 590-91. To satisfy Rule 23(b)(3), the party seeking certification must show that (1)
common questions of law or fact predominate (“predominance”); and (2) a class action is the
superior method for adjudication (“superiority”). See id. at 591 (citation omitted).
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B. Analysis
i.

Kausar’s Proposed Class

Kausar seeks certification of the following proposed class:
(1) all persons with a New Jersey address
(2) to whom GC Services Limited Partnership mailed an initial communication letter in a
form materially identical or substantially similar to the letter attached as Exhibit A to the
Plaintiff’s Complaint (Doc. No. 1-2) that stated: (a) “However, if you do dispute all or any
portion of this debt within 30 days of receiving the letter, we will obtain verification of the
debt from our client and send it to you.” and/or (b) “if within 30 days of receiving this letter
you request the name and address of the original creditor, we will provide it to you in the
event it differs from our client, Synchrony Bank”
(3) between August 5, 2014 through and including August 24, 2015
(4) in connection with the collection of a consumer debt
(5) that was not returned as undeliverable to GC Services Limited Partnership.
(D.E. No. 59-1 at 6).
ii.

Kausar’s Standing

To start, GC argues that Kausar’s motion for class certification should be denied and her
case should be dismissed because she lacks Article III standing under Spokeo v. Robins, 136 S. Ct.
1540 (2016). (See D.E. No. 73 at 7-12). GC made these same arguments in its Rule 12(b)(1)
motions to dismiss. (See D.E. Nos. 24-1 & 44-1). The Court unequivocally rejected these
arguments in a full Opinion and Order. (D.E. Nos. 52 & 53). GC’s opposition nowhere mentions
the Court’s previous decision on Kausar’s standing. For the reasons set forth in the Court’s
November 8, 2017 Opinion, the Court again rejects GC’s arguments that Kausar lacks Article III
standing under Spokeo.
iii.

Ascertainability

The ascertainability inquiry requires the party seeking certification to show that (1) the
class is “defined with reference to objective criteria”; and (2) there is “a reliable and
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administratively feasible mechanism for determining whether putative class members fall within
the class definition.” Byrd, 784 F.3d at 163 (citations omitted).
First, the Court finds that the proposed class is defined with reference to objective criteria.
As Kausar points out, the class “is limited in both space (New Jersey residents only) and time
(between August 5, 2014 through and including August 24, 2015).” (D.E. No. 59-1 at 13). Thus,
the proposed class “simply requires individuals to be New Jersey residents to whom [GC] mailed
an unreturned letter containing the same legally defective language as the letter Ms. Kausar
received during a limited time period.” (D.E. No. 76 at 6); see Nepomuceno v. Midland Credit
Management, Inc., No. 14-5719, 2016 WL 3392299, at *3-4 (D.N.J. June 13, 2016) (finding a
proposed class in an FDCPA case ascertainable in part because it was limited to New Jersey
residents to whom the defendant sent an allegedly defective debt-collection letter during a set time
period).
Second, the Court finds that there is a reliable and administratively feasible mechanism for
determining whether putative class members fall within the class definition. Under this prong, “a
plaintiff need only show that ‘class members can be identified.’” Byrd, 784 F.3d at 163 (quoting
Carrera, 727 F.3d at 308 n.2) (emphasis in original). Kausar explains that GC’s business records
reveal the identities and mailing addresses of all class members (D.E. No. 59-1 at 14), and she
attaches an email from GC’s counsel stating that there were 1,876 people who met the class
definition (D.E. No. 59-5). GC also acknowledges in its opposition that it “mailed approximately
1,876 such letters to addresses in New Jersey.” (D.E. No. 73 at 21). This showing more than
satisfies Kausar’s burden. See Carrera, 727 F.3d at 308 n.2 (“Although some evidence used to
satisfy ascertainability, such as corporate records, will actually identify class members at the

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certification stage, ascertainability only requires the plaintiff to show that class members can be
identified. Accordingly, there is no records requirement.”) (internal citation omitted).
GC advances two primary arguments in opposition. First, GC argues that the proposed
class is not ascertainable because each member of the class may or may not have standing under
Spokeo, and “an extensive inquiry would be required to determine whether each alleged, absent
class member has an actual, concrete injury of his or her own . . . .” (D.E. No. 73 at 13-14)
(emphasis in original). GC says it “is axiomatic that each member of the proposed class must also
have standing to sue.” (Id. at 14) (citing Avritt v. Reliastar Life Ins. Co., 615 F.3d 1023, 1034 (8th
Cir. 2010) and Denney v. Deutsche Bank AG, 443 F.3d 253, 263-64 (2d Cir. 2006)).
GC is incorrect. The Third Circuit has squarely held that “unnamed, putative class
members need not establish Article III standing.” Neale v. Volvo Cars of N. Am., LLC, 794 F.3d
353, 363 (3d Cir. 2015); see also In re Horizon Healthcare Servs. Inc. Data Breach Litig., 846
F.3d 625, 634 (3d Cir. 2017) (“[N]amed plaintiffs who represent a class must allege and show that
they personally have been injured, not that injury has been suffered by other, unidentified members
of the class to which they belong and which they purport to represent.”). “Instead, the ‘cases or
controversies’ requirement is satisfied so long as a class representative has standing, whether in
the context of a settlement or litigation class.” Neale, 794 F.3d at 363. In Neale, the Third Circuit
acknowledged conflicting precedent in the Eighth and Second Circuits—the two cases GC cites—
and explains at length why it found those cases unpersuasive. See id. at 365.
Second, GC argues that the proposed class is not ascertainable because “it is impossible to
ascertain who (1) actually received the letter, (2) then, actually opened the letter, (3) then, actually
read the letter, and (4) for those proposed class members who did, suffered the requisite ‘concrete
and particularized’ injury to have standing to bring suit.” (D.E. No. 73 at 19). This argument is
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also without merit because “unnamed, putative class members need not establish Article III
standing.” Neale, 794 F.3d at 363. Indeed, another court in this District recently rejected this very
argument. Nepomuceno, 2016 WL 3392299, at *4 (“Whether the proposed definition includes
individuals who did not receive Defendant’s letter does not prevent the individuals in the definition
from being identified and, therefore, does not affect whether Plaintiff has satisfied the
ascertainability requirement.”); see id. (explaining that “this sort of argument ‘conflates the issues
of ascertainability, overbreadth (or predominance) and Article III standing’”) (quoting Byrd, 784
F.3d at 168). Kausar’s proposed class is therefore ascertainable.
iv.

Numerosity

Rule 23(a)(1)’s numerosity requirement is satisfied where “the class is so numerous that
joinder of all members is impracticable.” “There is no minimum number of members needed for
a suit to proceed as a class action.” Marcus, 687 F.3d at 595 (citation omitted). But the Third
Circuit has observed that “generally if the named plaintiff demonstrates that the potential number
of plaintiffs exceeds 40, the first prong under Rule 23(a) has been met.” Id. (citation omitted). To
be sure, “Rule 23(a)(1) ‘requires examination of the specific facts of each case.’” Id. (quoting
Gen. Tel. Co. of the N.W. v. EEOC, 446 U.S. 318, 330 (1980)). And “numerosity—like all Rule
23 requirements—must be proven by a preponderance of the evidence.” Id. (citation omitted).
Here, Kausar has sufficiently demonstrated that the proposed class “is so numerous that
joinder of all members is impracticable.” Kausar has submitted direct evidence that the proposed
class comprises 1,876 members. (See D.E. No. 59-1 at 16) (citing D.E. Nos. 59-5 (Ex. D) & 59-6
(Ex. E)). As Kausar points out, her proposed class is far more numerous than a 124-member
FDCPA class this Court recently certified. (See id.) (citing Griffin v. Zager, No. 16-1234, 2017
WL 3872401, at *3 (D.N.J. Sept. 1, 2017)). In light of Kausar’s showing, “common sense suggests
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that it would be difficult or inconvenient to join all class members.” See In re Prudential Ins. Co.
of Am. Sales Practices Litig., 962 F. Supp. 450, 510 (D.N.J. 1997).
Defendant argues that Kausar “has failed to meet her burden of demonstrating the number
of persons she seeks to represent and who actually have standing to sue.” (D.E. No. 73 at 21)
(emphasis in original). And GC reiterates its arguments about putative class members not having
“actually received, opened and/or read the letter in question . . . .” (Id.). These arguments are
without merit for the reasons discussed above. See Neale, 794 F.3d at 363 (holding that “unnamed,
putative class members need not establish Article III standing”).
v.

Commonality

Rule 23(a)(2)’s commonality requirement is satisfied where “there are questions of law or
fact common to the class.” Where, like here, a party is seeking class certification under Rule
23(b)(3), “the commonality requirement is subsumed by the predominance requirement.” Danvers
Motor Co. v. Ford Motor Co., 543 F.3d 141, 148 (3d Cir. 2008) (citation and internal quotation
marks omitted). The Court will therefore address the commonality requirement with the Rule
23(b)(3) predominance requirement below.
vi.

Typicality

Rule 23(a)(3)’s typicality requirement is satisfied where “the claims or defenses of the
representative parties are typical of the claims or defenses of the class.” This requirement aims
“to screen out class actions in which the legal or factual position of the representatives is markedly
different from that of other members of the class . . . .’” Marcus, 687 F.3d at 598 (citation and
internal quotation marks omitted). To determine whether a plaintiff has satisfied the typicality
requirement, courts “consider the attributes of the plaintiff, the class as a whole, and the similarity
between the plaintiff and the class.” Id. (citing In re ScheringPlough Corp. ERISA Litig., 589 F.3d
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585, 597 (3d Cir. 2009)). “If a plaintiff’s claim arises from the same event, practice or course of
conduct that gives rises [sic] to the claims of the class members, factual differences will not render
the claim atypical if it is based on the same legal theory as the claims of the class.” Id. (citing
Hoxworth, 980 F.2d at 923).
Kausar alleges that GC violated the FDCPA by sending her a legally deficient debtcollection letter. This is the same claim that the putative class members would assert. As Kausar
explains, “typicality is inherent in the class definition. By definition, each of the class members
has been subject to the same treatment as Plaintiff . . . [and] Plaintiff’s claim is identical to those
of the class members.” (D.E. No. 59-1 at 19). The Court agrees with Kausar that, at this stage of
the proceedings, “[t]here are no unique facts or circumstances that would render [her] claim
atypical.” (Id.). See, e.g., Nyby v. Convergent Outsourcing, Inc., No. 15-0886, 2017 WL 3315264,
at *5 (D.N.J. Aug. 3, 2017) (finding typicality where the plaintiff alleges the same claims and
injury as the putative class: “receiving the same Letter that allegedly violates the FDCPA”);
Weissman v. Gutworth, No. 14-0666, 2015 WL 3384592, at *3 (D.N.J. May 26, 2015) (finding
typicality where the plaintiff’s claims and the putative class members’ claims “are predicated on
the same legal and factual circumstances: Defendants’ alleged practice of mailing collection letters
with legally deficient language”).
GC argues that Kausar fails to show typicality because she never identifies her injury, so
the Court cannot meaningfully evaluate whether her injury is typical of the putative class members’
injuries. (D.E. No. 73 at 25). As noted above, the Court previously issued an Opinion finding that
Kausar sufficiently alleged an injury. (D.E. No. 52). The Court declines to revisit this issue.
vii.

Adequacy

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Rule 23(a)(4)’s adequacy requirement is satisfied where “the representative parties will
fairly and adequately protect the interests of the class.” For this inquiry, courts consider whether
“the putative named plaintiff has the ability and the incentive to represent the claims of the class
vigorously,” and whether there is a “conflict between the individual’s claims and those asserted
on behalf of the class.” In re Cmty. Bank of N. Va., 622 F.3d 275, 291 (3d Cir. 2010) (citation
omitted). The adequacy requirement “is vital, as ‘class members with divergent or conflicting
interests from the named plaintiffs and class counsel cannot be adequately represented.’” Id.
(quoting In re Diet Drugs Prods. Liab. Litig., 385 F.3d 386, 395 (3d Cir. 2004)) (brackets and
ellipsis omitted).
Courts also must assess the adequacy of class counsel. See Fed. R. Civ. P. 23(g).
“Although questions concerning the adequacy of class counsel were traditionally analyzed under
the aegis of the adequate representation requirement of Rule 23(a)(4) . . . those questions have,
since 2003, been governed by Rule 23(g).” Dewey v. Volkswagen Aktiengesellschaft, 681 F.3d
170, 181 n.13 (3d Cir. 2012) (citation omitted) (ellipsis in original). “But when the parties do not
dispute the adequacy of class counsel, a court may consider the adequacy requirement strictly
through the lens of Rule 23(a)(4).” Williams v. Pressler & Pressler, LLP, No. 11-7296, 2013 WL
5435068, at *4 (D.N.J. Sept. 27, 2014) (quoting Dewey, 681 F.3d at 181 n.13) (internal quotation
marks and bracket omitted).
1. Kausar’s Adequacy
Kausar provides several reasons why she thinks she is an adequate class representative.
(D.E. No. 59-1 at 21-23). First, she asserts through her affidavit that she is knowledgeable about
the case. (See D.E. No. 59-7 (“Kausar Aff.”) ¶¶ 7-9). Second, she explains that she “has been
actively involved with the litigation” since its start in August 2015. (D.E. No. 59-1 at 22). She
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says she “reviewed the complaint and other documents, prior to their filing, reviewed and signed
her attached declaration, refused an individual offer of settlement, and has pursued this case as a
class action from the beginning with the goal of obtaining relief for the members of the class.”
(Id.).

Third, she highlights her participation in discovery, noting that she “responded to

Defendant’s discovery requests and reviewed the responses before they were sent to Defendant.”
(Id.). Fourth, she states that she “has an understanding of her role and duties as a class
representative.” (Id.) (citing Kausar Aff. ¶¶ 14-21). In particular, she says she “is representing
other people in the same situation and has the responsibility to act in their best interests.” (D.E.
No. 59-1 at 22). Finally, Kausar also asserts that she “has no conflicts with any of the class
members nor does she have any interests antagonistic to or in conflict with the class.” (Id.).
GC counters that “fundamental conflicts” between Kausar’s interests and those of the
putative class members preclude a finding of adequacy. (D.E. No. 73 at 26). According to GC,
“[i]t is certainly conceivable some putative class members will claim to have been harmed by the
same conduct that benefitted other members of the class.” (Id. at 26-27). In other words, GC says
that some putative class members may have benefitted from the letter because if they contacted
GC in any form (i.e., not just in writing) to dispute their debt or to request the name and address
of the original debtor, GC would have honored those requests. (Id. at 27). So, for those people,
GC’s letter was helpful, not harmful. (Id. at 27). GC also raises the issue of damages, arguing that
Kausar’s choice to forgo actual damages and seek only statutory damages creates the potential for
a conflict of interest with putative class members who may want to seek actual damages. (Id.).
GC asserts that certification of Kausar’s proposed class would preclude putative class members
who suffered actual damages from recovering them. (Id. at 27-28).

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As Kausar points out, GC’s argument appears inconsistent with applicable caselaw. For
example, the Eleventh Circuit rejected GC’s precise argument in a case involving the same debtcollection letter at issue here:
there are two problems with GC Services’ argument. First, at this stage, the record
contains no evidence that any consumer actually benefitted from its purportedly
more permissive policy. Second, and more importantly, while some consumers
may have benefitted from GC Services’ lenient policy, no consumer could have
benefitted from its FDCPA violation.
Dickens v. GC Services Ltd. P’ship., 706 F. App’x 529, 536 (11th Cir. 2017). In the same case,
the Eleventh Circuit also rejected GC’s damages argument, explaining that “any conflict between
[the named plaintiff] and class members who have suffered actual damages is especially minimal
given that in the rare circumstance in which a class member suffered actual damages, the class
member could simply opt out of the class and pursue litigation on his own.” See id. at 535-36. In
fact, as another court in this District observed, “a potential sub-class, if necessary, can be created,
to include the class members that have sustained actual damages in response to [the defendant’s]
letters.” Grubb, 2017 WL 3191521, at *24. So too here. Kausar is thus an adequate class
representative for purposes of Rule 23(a)(4).
2. Class Counsel’s Adequacy
Because the parties do not dispute the adequacy of class counsel, the Court will consider
the issue “strictly through the lens of Rule 23(a)(4).” See Dewey, 681 F.3d at 181 n.13. Kausar
submits a declaration on behalf of her attorney, Mr. Ryan Gentile, that confirms Mr. Gentile’s
adequacy to serve as class counsel. (D.E. No. 59-8 (“Gentile Decl.”)). For example, since 2007
Mr. Gentile has “worked on primarily consumer cases including bankruptcy cases and claims
under the FDCPA.” (Id. ¶ 6(a)). He has also been appointed sole class counsel in three previous
FDCPA class actions. (See id. ¶ 6(c)). Based on these facts, his declaration as a whole, and his
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prior submissions in this case, the Court is satisfied that Mr. Gentile would adequately represent
the proposed class.
viii.

Predominance

As noted above, courts considering class certification under Rule 23(b)(3) analyze the
commonality and predominance requirements together. Sullivan v. DBInvestments, Inc., 667 F.3d
273, 297 (3d Cir. 2011) (“We consider the Rule 23(a) commonality requirement to be incorporated
into the more stringent Rule 23(b)(3) predominance requirement, and therefore deem it appropriate
to analyze the two factors together, with particular focus on the predominance requirement.”)
(citation and internal quotation marks omitted). Under Rule 23(b)(3), a class action cannot be
maintained unless, among other things, the court finds that “questions of law or fact common to
class members predominate over any questions affecting only individual members . . . .” This
predominance requirement “tests whether proposed classes are sufficiently cohesive to warrant
adjudication by representation.” Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623 (1997).
Under the predominance requirement:
a court at the certification stage must examine each element of a legal claim through
the prism of Rule 23(b)(3). A plaintiff must demonstrate that the element of [the
legal claim] is capable of proof at trial through evidence that is common to the class
rather than individual to its members. 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 in order to determine whether common or individual issues
predominate in a given case.
Marcus, 687 F.3d at 600 (citations and internal quotation marks omitted).
Kausar alleges that GC sent her and all putative class members identical or substantially
similar debt-collection letters that violated § 1692g(a)(4) and § 1692g(a)(5) of the FDCPA. (See
D.E. No. 59-1 at 25). “Therefore, the potential class members’ claims turn on the same legal
determination, i.e., whether the content of these communications are in violation of [the FDCPA].”
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Grubb, 2017 WL 3191521, at *22. Courts in this District routinely find predominance in similar
contexts. See, e.g., id.; Nyby, 2017 WL 3315264, at *6; Weissman, 2015 WL 3384592, at *3;
Little-King v. Hayt Hayt & Landau, No. 11-5621, 2013 WL 4874349, at *7 (D.N.J. Sept. 10, 2013);
Stair v. Thomas & Cook, 254 F.R.D. 191, 201 (D.N.J. 2008).
In opposition, GC reiterates its standing arguments.

GC contends that “individual

questions regarding the proposed class members’ standing to bring suit overwhelm any questions
common to the class, thus precluding class certification . . . .” (D.E. No. 73). But again, GC’s
arguments conflict with binding Third Circuit precedent. See Neale, 794 F.3d at 363 (holding that
“unnamed, putative class members need not establish Article III standing.”). The Court therefore
finds that Kausar has satisfied the commonality and predominance requirements.
ix.

Superiority

To satisfy Rule 23(b)(3)’s superiority requirement, the party seeking certification must
show “that a class action is superior to other available methods for fairly and efficiently
adjudicating the controversy.” Rule 23(b)(3) provides that “[t]he matters pertinent to these
findings include”: (1) the class members’ interests in individually controlling the prosecution or
defense of separate actions; (2) the extent and nature of any litigation concerning the controversy
already begun by or against class members; (3) the desirability or undesirability of concentrating
the litigation of the claims in the particular forum; and (4) the likely difficulties in managing a
class action. “The superiority requirement asks the court to balance, in terms of fairness and
efficiency, the merits of a class action against those of alternative available methods of
adjudication.” In re Prudential, 148 F.3d at 316 (citation and internal quotation marks omitted).
For the first two factors, Kausar states that “no class member has demonstrated an interest
in controlling the prosecution of the action because there are no other cases against GC involving
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the issues presented in this case by any proposed member.” (D.E. No. 59-1 at 27). For the third
factor, Kausar submits that this “forum is desirable because the proposed class contains New Jersey
residents only.” (Id.). For the fourth factor, Kausar asserts that “there will be no difficult casemanagement issues because the facts and claims are very straightforward.” (Id.). To that end,
Kausar explains that the “evidence necessary to prosecute the case is within Defendant’s records,”
and her claim presents “a straightforward question concerning the legality of a printed form letter
and standardized practice.” (Id.). This claim, according to Kausar, “is significantly simpler than
many other claims that are routinely certified as class actions, such as securities and price fixing
cases.” (Id.). GC does not address the superiority requirement.
For the reasons Kausar identifies, the Court agrees that “a class action is superior to other
available methods for fairly and efficiently adjudicating the controversy.” Indeed, as Kausar points
out, “numerous other [c]ourts within this District have routinely held that class actions are the
superior method to adjudicate FDCPA cases that were based on form collection letters.” (Id. at
26) (citing Griffin, 2017 WL 3872401, at *5; Nyby, 2017 WL 3315264, at *6; Nepomuceno, 2016
WL 3392299, at *10; Weissman, 2015 WL 3384592, at *4; Gregory v. McCabe Weisberg &
Conway, P.C., No. 13-6962, 2014 WL 2615534, at *7 (D.N.J. June 12, 2014); Williams, 2013 WL
5435068, at *11; Little-King, 2013 WL 4874349, at *7; Still v. JBC Assocs., P.C., No. 02-3550,
2005 WL 1334715, at *6 (D.N.J. June 3, 2005)).
IV.

Conclusion
For the foregoing reasons, the Court DENIES GC’s motion to compel arbitration and

GRANTS Kausar’s motion for class certification.
Opinion.

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An appropriate Order accompanies this

s/Esther Salas
Esther Salas, U.S.D.J.

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