Frey et al v. Bekins Van Lines, Inc. et al

Filing 101

MEMORANDUM AND ORDER denying 73 Motion to Certify Class. For the reasons set forth herein, pltffs' motion for class certification is denied. ( Ordered by Senior Judge Leonard D. Wexler on 4/2/2012.) c/m (Fagan, Linda)

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

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MELINDA FREY and YAJAIRA RUIZ MERCEDES,
Individually and on behalf of all other persons
similarly situated,

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(Wexler, J.)
-againstBEKINS VAN LINES, INC. TRIPLE CROWN
MAFUCCI STORAGE CORP., TRIPLE CROWN
MOVING & STORAGE, INC., JUDD LEVINE,
PAUL LEVINE and JOHN DOES #1-10,
JOINTLY and SEVERALLY,
Defendants.

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APPEARANCES:
LEEDS MORELLI & BROWN, P.C.
BY: JEFFREY K. BROWN, ESQ.
Attorneys for Plaintiff
One Old Country Road, Suite 34 7
Carle Place, NY 11514
THE CULLEN LAW FIRM
BY: JOSEPH A. BLACK, ESQ.
DANIEL E. COHEN, ESQ.
Attorneys for Plaintiffs
1101 30th Street, N.W. Suite 300
Washington, D.C. 20007
GOTTLIEB & ASSOCIATES
BY: JEFFERY M. GOTTLIEB, ESQ.
Attorneys for Plaintiffs
150 East 18th Street Suite PHR
New York, New York 10003
BARRYN. GUTTERMAN & ASSOCIATES, P.C.
BY: BARRY N. GUTTERMAN, ESQ.
Attorneys for Defendant Triple Crown Mafucci Storage Corp.,
Triple Crown Moving & Storage, Inc., Judd Levine, Paul Levine
85 Davids Way
Bedford Hills, New York 10507
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LOi\0 ISLAND OFFICE

cv 09-5430

Plaintiffs,

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DOMBROFF GILMORE JACQUES & FRENCH
BY: KAREN M. BERBERICH, ESQ.
Attorneys for Defendants Bekins Van Lines, LLC
40 Broad Street Suite 701
New York, New York 10004-2382
WEXLER, District Judge
This action, commenced by three Plaintiffs, originally alleged both federal and state
causes of action arising out of the Plaintiffs' shipment of household goods by the Defendant
companies. One Plaintiff has settled her claim with Defendants. 1 The two Plaintiffs who remain
seek to pursue claims on behalf of themselves, and a class of individuals alleged to be similarly
situated.
Plaintiffs claim, inter alia, that Defendants are engaged in a pattern and practice of
quoting lower shipping prices than those ultimately charged - a practice referred to as "lowballing" estimates - with the intent of charging higher amounts. 2 The core of Plaintiffs'
complaint rests on allegations arising out of price quotes based upon estimated weight of shipped
goods, as compared to the weights ultimately billed. Plaintiffs allege, and have come forward
with evidence to support the allegation, that Defendants often failed to actually weigh shipped
goods. Instead, Plaintiffs' proffered evidence tends to show that Defendants charged fees based
upon false weights arbitrarily assigned to shipments so as to increase prices ultimately charged to
Plaintiffs and members of the proposed class.

Remaining for disposition at the conclusion ofthis matter is Plaintiffs' counsels'
motion for attorneys' fees alleging that the settlement was inappropriately reached
and not authorized by counsel.
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The amended complaint also alleges overcharging with respect to add-on services,
including fuel supplements and insurance premiums on policies. Plaintiffs reply
memorandum of law states that they seek damages "only for the difference
between the estimated weight and the final weight." Thus, they appear to have
abandoned any claim other than a claim based upon a false weight.
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Defendants have previously moved, pursuant to Rule 12(b)(6) of the Federal Rules of
Civil Procedure, to dismiss the complaint. In the context of that motion, Defendants argued that
Plaintiffs' state law claims were preempted by a broad theory of field preemption, as well as by a
specific statutory provision. In a Memorandum and Order dated October 25, 2010, this court
rejected the preemption arguments raised. See Frey v. Bekins Van Lines. Inc., 748 F. Supp.2d
176 (E.D.N.Y. 2010). Thereafter, this court ruled on Defendants' motion, pursuant to Rule 12(c)
ofthe Federal Rules of Civil Procedure. In an Memorandum and Order dated August 9, 2011,
this court granted the motion, holding that "state laws with respect to fraud, negligence, unjust
enrichment and consumer protection" were preempted by 49 U.S.C. §14501(c)(1). Frey v. Bekins
Van Lines. Inc., 802 F. Supp.2d 438, 443 (E.D.N.Y. 2011). The court therefore dismissed
Plaintiffs' fifth through eleventh causes of action which alleged various state law claims
including fraud, negligence, unjust enrichment and the violation of state consumer protection
laws. ld.
Presently before the court is Plaintiffs' motion, pursuant to Rule 23(b)(3) ofthe Federal
Rules of Civil Procedure, to certify a class to litigate the claims that remain on behalf of a
proposed class. The claims that survived the two motions to dismiss are Plaintiffs' first, second,
third and thirteenth causes of action. These causes of action allege violation of federal statutes
and regulations. Pre-motion summary judgment correspondence to this court make clear that
Plaintiffs do not intend to pursue the first cause of action as a separate cause of action, but intend
only to rely on this statute to clarify their class definition. Accordingly, when determining the
issues relevant to this motion for class certification, the court considers only the second, third and
thirteenth causes of action. Those causes of action allege, respectively, violations of 49 U.S.C.

§ 13708(a) (second cause of action); 49 U.S. C. § 13708(b) (third cause of action) (collectively the
"Section 13708 Causes of Action"), and 49 C.F.R. §§375.215, 375.519 (thirteenth cause of
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action) (the Regulations). The Section 13708 Causes of Action alleged that Defendants failed to
disclose "actual rates, charges, or allowances for any transportation service and ...whether and to
whom any allowance or reduction in charges [were] made" and that Defendants presented "false
or misleading information on a document about the actual rate, charge, or allowance to any party
to the [shipping] transaction." 49 U.S.C. §§13708(a)(b). The Regulations alleged to have been
violated: (1) require the issuance of an "honest, truthful freight or expense bill .... " 49 C.F .R. §
375.215, and (2) set forth specific requirements with respect to the preparation and retention of
weight tickets, see 49 C.F.R. § 375.519
BACKGROUND
I.

The Parties and Plaintiffs' Allegations
The court assumes familiarity with the identity of the parties and the facts as set forth in

the court's prior decision denying the motions to dismiss. Briefly stated, Plaintiffs are individuals
who have used Defendants' shipping services. Plaintiffs' shipments originated in New York and
terminated in their current states of residence. Defendant Bekins Van Lines, LLC ("Bekins") is a
motor carrier engaged in the business of transporting household goods. It is a party to an agency
agreement with Defendant Triple Crown Mafucci Storage Corporation, ("Triple Crown"),
pursuant to which Triple Crown acts as Bekins' agent in the transportation of, inter alia,
household goods.
At the core of Plaintiffs' claims are allegations regarding the inaccuracy and fraudulent
nature of weight tickets assigned to shipments. Plaintiffs allege that Defendants violated various
laws that require the presentation of true weight tickets substantiating charges based upon the
weight of shippers' good. Plaintiffs assert that Defendants (or their agents) were required to
properly weigh shipped goods so as to provide accurate bills to customers who received nonbinding estimates of shipping charges. Plaintiffs state that estimates provided to them and to
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members of the proposed class were far exceeded based upon false weight tickets. Essentially,
Plaintiffs allege that their goods were either not weighed at all, or inaccurately weighed so as to
increase their fmal charges. The weight tickets submitted to customers are alleged to have been
false, fraudulent and/or altered by Defendants.
II.

Facts Established During Discovery
Plaintiff Frey is a resident of the State of California and Plaintiff Ruiz is a resident of the

State of Arizona. Defendant Bekins transported goods for Frey in 2007, and for Ruiz in
December of2008. Plaintiffs' shipments originated in New York and terminated in their current
states of residence.
During the course of discovery, the parties took depositions of Plaintiffs as well as those
of third party witnesses. Among those third party witnesses deposed were Terry Anderson
("Anderson"), a former Triple Crown truck driver, Andy Mangual ("Mangual"), a former Triple
Crown dispatcher, and Kevin White, ("White") a former Triple Crown Sales Representative.
Each of these deponents testified as to weighing practices that they witnesses when employed by
Triple Crown. Anderson and Mangual testified as to instances where the weights reported on
weight tickets were inflated beyond the actual weight of the shipment. Anderson testified that
weight tickets were not generated after the actual weighing of trucks. Instead, employees
searched through a stack of pre-existing weight tickets in search of a ticket bearing the amount
desired, and used that ticket to represent the shipment that was purportedly weighed.
Both witnesses stated that the falsification of weights occurred on several occasions
throughout their tenures with Triple Crown. Third party witness White testified that he observed
Mangual going through pre-existing weight tickets in search of a ticket with a desired weight to
attach to a shipment. White referred to such tickets as "fake," meaning that although the ticket
was an actual weight ticket, it was not generated from the current shipment, but instead, was
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"recycled" from a prior shipment. Third party witness Karen Crisci, a former Triple Crown
Rating Clerk testified similarly as to a "stash" of weight tickets. Third party witness Robert
Benedict, a former Triple Crown driver also testified as to the false weighing practices referred to
above.
Defendants dismiss Plaintiffs' proffer of evidence as nothing more than the testimony of
former disgruntled Triple Crown employees. These employees are alleged to have been
represented by Plaintiffs' counsel in a prior employment discrimination lawsuit. For a variety of
reasons which the court will not detail here, their testimony is alleged to be severely
compromised and lacking in credibility. In support of its position, Bekins states that it follows its
policy manual which assures its agents' compliance with federal regulations and proper company
procedures. Moreover, Bekins submits testimony of its witnesses setting forth compliance with
company policies. Defendants also point the court to Plaintiffs' testimony indicating their failure
to read explanatory documents provided by Bekins and generally lacking in knowledge as to the
proper claims procedures, and the manner in which shipped goods are weighed. Additionally,
Defendants state that increased charges to the named Plaintiff reflect not additional weight of
good shipped, but a variety of "add-on" charges having no relation to the claims in this lawsuit.
After setting forth applicable class action certification principles, the court will turn to the
merits of this motion.
DISCUSSION
I.

Class Certification: Legal Principles
Motions for class certification are governed by Rule 23 ofthe Federal Rules of Civil

Procedure. When determining a motion for class certification, the court determines first whether
the party seeking certification has satisfied the four prerequisites of Rule 23(a) of the Federal
Rules of Civil. Thus, the court decides whether:
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( 1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical of the claims or
defenses ofthe class; and
(4) the representative parties will fairly and adequately protect the interests ofthe class.
Fed. R. Civ. P. 23(a);

see,~.

Wal-Mart Stores. Inc. v. Dukes, 131 S. Ct. 2541,2550 (2011);

Marisol A. v. Giuliani, 126 F.3d 372,375 (2d Cir.1997); Ramos v. SimplexGrinnell LP, 796 F.
Supp.2d 346,353 (E.D.N.Y. 2011).
Numerosity requires that the class be "so numerous that joinder of all members is
impracticable." Fed.R.Civ.P. 23(a)(l). This requirement is assumed to be satisfied ifthe putative
class reaches forty members. Consol. Rail Cor:p. v. Town ofHyde Park, 47 F.3d 473, 483 (2d
Cir.1995). Commonality requires a plaintiffto demonstrate that "there are questions oflaw or
fact common to the class." Fed.R.Civ.P. 23(a)(2). The commonality requirement can be satisfied
by the existence of a single common question of fact or law. See Dukes, 131 S. Ct. at 2556
("[F]or purposes of Rule 23(a)(2) even a single common question will do." (internal quotations
and alterations omitted)); In reAgent Orange Product Liability Litigation MDL No. 381, 818
F.2d 145, 166-67 (2d Cir.1987) (defense common to all defendants sufficient to satisfy
commonality requirement).
Typicality requires a plaintiff to establish that "the claims or defenses of the
representative parties are typical ofthe claims or defenses ofthe class." Fed. R. Civ. P. 23(a)(3);
see also Brown v. Kelly, 609 F.3d 467, 475 (2d Cir.2010). This requirement is satisfied when
each class member's claim arises from the same course of events, and each class member makes
essentially the same legal and factual arguments to prove the defendant's liability. Marisol A. v.
Giuliani, 126 F.3d 372, 376 (2d Cir.1997). "While it is settled that the mere existence of

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individualized factual questions with respect to the class representative's claim will not bar class
certification, class certification is inappropriate where a putative class representative is subject to
unique defenses which threaten to become the focus ofthe litigation." Baffa v. Donaldson,
Lufkin & Jenrette Sec. Cor_p., 222 F.3d 52, 59 (2d Cir.2000).
If the requirements of Rule 23(a) are met, the court then considers whether one of the
subsections ofRule 23(b) is also satisfied. Brown v. Kelly, 609 F.3d 467, 475 (2d Cir. 2010);
Marisol A., 126 F.3d at 375-76. Plaintiffs here seek class certification pursuant to Rule 23(b)(3).
That rule provides for class certification if"the questions oflaw or fact common to the members
of the class predominate" over individual issues and "a class action is superior to other available
methods for fairly and efficiently adjudicating the controversy." Fed. R. Civ. P. 23(b)(3).
Issues arising from allegations of commonality with respect to Rule 23(a) are also
relevant to the Rule 23(b)(3) inquiry, which requires the court to determine whether common
questions "predominate over any questions affecting only individual members." Fed. R. Civ. P.
23(b)(3); In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124, 136 n. 6 (2d Cir.2001)
(addressing commonality and typicality in the context of the predominance requirement of Rule
23(b)(3)). Whether a court is required to determine that a particular question is common to the
class for either commonality or predominance purposes, the analysis is the same. Required is a
determination that plaintiffs' claims "depend upon a common contention" that is "of such a nature
that it is capable of classwide resolution." Dukes, 131 S.Ct. at 2551. A claim is capable of
class-wide resolution when the "determination of its truth or falsity will resolve an issue that is
central to the validity of each one of the claims in one stroke." Id.
When deciding a motion for class certification, the court cannot consider only the bare
allegations of a pleading. Instead, a "rigorous" analysis is required, often entailing consideration
of issues that overlap with the merits ofthe claims. Dukes, 131 S. Ct. 2541, 2551-52; see General
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Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 160 (1982). A class action may be
maintained only if the class representative is a part of the proposed class who has the same
"interest" and suffered the same injury as class members. Dukes, 131 S. Ct. at 2550. As to
commonality, "[w]hat matters to class certification ... is not the raising of common
'questions'--even in droves-but, rather the capacity of a classwide proceeding to generate
common answers apt to drive the resolution ofthe litigation. Id. at 2551 (quotation omitted).
While the court does not decide the Plaintiffs' case on the merits, it must, in view of the
requirements set forth above, consider the elements of the Plaintiffs' claim when determining
whether it is appropriate to certify the requested class. Therefore, with an eye toward the merits
of Plaintiffs' claims, the court reviews their class action allegations.
II.

Class Allegations
A.

Class Definition/Numerosity

Plaintiffs initially proposed a class defined to include "all persons or entities whose
household goods were shipped by Defendants." In response to Defendants' response to the class
certification motion, Plaintiffs offer to refine their class definition to include:
all persons or entities who whose
(a) household goods were shipped by Defendants, (excluding government, military, and
corporate shipments),
(b) whose goods were shipped pursuant to non-binding estimates, from December 11,
2005, to date and
(c) whose paid in excess of 110% ofthe estimate received3 and,
(d) whose weight tickets are either missing or are non-compliant with federal regulations.

Plaintiffs state that records reveal that the class consists of over 6,000 potential class
members who used any Bekins' agent and in excess of700 class members who used Triple
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Plaintiffs' class definition states "the estimate was over 110%." The court
assumes that Plaintiffs mean to define the class to include those who ultimately
paid more that 110% ofthe estimated shipping cost quoted.

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Crown's shipping services. Plaintiffs have obtained and reviewed the records and weight tickets
associated with shipments of 1,700 ofthe 6,000 Bekins customers. According to Plaintiffs,
approximately 40% of those tickets are not compliant with regulations either because they do not
exist or because they either do not contain required information.
B.

Commonality

As to commonality, Plaintiffs allege that Defendants have a uniform policy of fraud with
respect to the preparation of weight tickets. Specifically, it is alleged that there exists a policy of
providing weight estimates to household goods shippers, and thereafter charging an amount
based upon higher unsubstantiated weights. Plaintiffs allege that Defendants' alleged practice
shows a consistent violation of federal law. While the actual amount of damages will differ
among Plaintiffs, each class member is alleged to have suffered the same type of damage. Such
damages are alleged to be easily calculable by comparing computerized records of estimated
shipping costs versus actual costs billed.
C.

Typicality

Plaintiffs alleged that their claims are typical of the class in that both Frey and Ruiz
received price quotes based upon estimated weights that were far exceeded by the "actual"
weight of their shipments. As to Frey's shipment, Plaintiffs state an additional charge based
upon a 30% increase in weight. Ruiz alleges that she was charged an additional 20% based upon
the stated actual weight. Both named plaintiffs allege that the stated actual weight charges were
false.
D.

Rule 23(b)(3)

As referred to above, Plaintiffs have submitted to the court a printed record ofBekins'
computerized records. Those records are stated to reveal each customer alleged to be a member
of the class. Each customer's estimated weight and actual weight are recorded. The damages are
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calculated based upon the difference in weights. Plaintiffs argue that use ofthese simple
numbers make the claims raised herein readily manageable as a class action.
III.

Disposition of the Motion
Like the case presented to the Supreme Court in Dukes, the court finds that this case

hinges on issues of commonality. In Dukes, the proposed class consisted of a nationwide class of
female Wal-Mart employees alleging discrimination based upon gender. Even assuming the truth
of the Dukes plaintiffs' contention as to a corporate culture of gender discrimination, the
Supreme Court held that a damages class could not be certified. Denying certification, the Court
noted that the resolution of any individual plaintiffs' claim required a determination of "the
reason for a particular employment decision," Dukes, 131 S. Ct. at 2552, quoting, Cooper v.
Federal Reserve Bank ofRichmond, 467 U.S. 867, 876 (1984). Existence ofthis important
individual issue was held to render the case unmanageable as a class action. Id. As discussed in
further detail below, the court holds that common issues neither predominate nor render a class
action superior or manageable. Therefore, the court denies the motion.
As noted above, Plaintiffs' allegations of commonality stem from the stated common
corporate policy of preparing fraudulent weight tickets. Even allowing for the possibility that
such a uniform policy existed, Plaintiffs make an impermissible leap from the existence of such a
policy to the management of a class action. Importantly, each member of the proposed classeven if limited in definition as set forth above - is subject to a variety of defenses and issues
arising therefrom explaining why the ultimate amounts billed differed from the estimates.
Plaintiffs note the difference between estimates and the amount billed and conclude that
the actual weight of no single shippers' shipment actually exceeded the estimated weight, and
that each ticket was either fraudulently prepared, or never in fact existed. This leap in logic is
simply too broad. While Plaintiffs' discount the possibility that any class members' shipment
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may have indeed, actually exceeded the estimated weight, it is certainly within the reasonable
realm of possibilities that this was the case. Indeed, the nature of an "estimated" cost makes this
outcome entirely likely. The key issue of whether any and all differences between estimated costs
and actual cost billed can be attributed to fraudulent, missing or destroyed weight tickets cannot
be answered "uniformly on a class-wide basis." Haynes v. Planet Automall, Inc., 276 F.R.D. 65,
79 (E.D.N.Y. 2011). Instead the court holds that it would be entirely speculative to assume that
each and every amount ultimately billed was based upon a fraudulent weight. While this may be
true in individual circumstances, there are likely as many shipments that exceeded estimated costs
because the estimated weight was low, or a variety of other reasons including the possibility that
shippers were charged for add-on services including packing and/or additional boxes.
The individual Plaintiffs may be able to prove their claims, but that does not translate into
a holding that they can prove a broad policy, uniformly adhered to, that entitles each and every
shipper to recoup an amount equal to the difference between the estimated and actual cost of
shipping. Put simply, the reason why any individual shippers' ultimate cost exceeded the
estimated cost is not an issue that is amenable to class treatment. Accordingly, Plaintiffs cannot
establish that the proposed class action satisfies the requirements of Rule 23. The motion for
class certification must therefore be denied.
CONCLUSION
For the foregoing reasons, Plaintiffs' motion for class certification is denied.
SO ORDERED

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LEONARD D. WEXLER
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UNITED STATES DISTRICT JUDGE

Central Islip, New York
April ~ , 2012

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