Fair Housing of the Dakotas, Inc. et al v. Goldmark Property Management Inc.

Filing 230

ORDER by Chief Judge Ralph R. Erickson denying 182 Motion to Certify Class. (SH)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NORTH DAKOTA
SOUTHEASTERN DIVISION
Fair Housing of the Dakotas, Inc., Larry
Norstedt, Betty Martin, Clarica Martin,
Lacey Anderson, Kristina Hilde, each
individually and on behalf of a class of
similarly situated persons,
Plaintiffs,
vs.
Goldmark Property Management, Inc.,
Defendant.

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Civil No. 3:09-cv-58
MEMORANDUM OPINION AND
ORDER DENYING PLAINTIFFS’
MOTION FOR CLASS
CERTIFICATION

Before the Court is Plaintiffs’ Motion for Class Certification (Doc. #182). Defendant
opposes the motion (Doc. #201). The Court, having considered the briefs and arguments by the
parties, now issues this memorandum opinion and order.
SUMMARY OF DECISION
Class certification is improper, as Plaintiffs have proposed classes containing individuals
that may not have suffered an injury in fact and, therefore, lack standing. Furthermore, Plaintiffs
have not established that their claims are identical to members of the putative class. There are
simply too many individual issues preventing this litigation from being certified as a class action
as proposed by Plaintiffs, and the evidence is insufficient for this Court to define a class that
meets the requirements of Rule 23(a). Because Plaintiffs have failed to meet all of the
requirements of Fed.R.Civ.P. 23(a), their motion to certify two classes and a subclass is denied.
BACKGROUND
As a matter of clarity, the Court’s previous summary judgment order found that the Fair
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Housing Act encompasses all types of assistance animals regardless of training; therefore,
Goldmark’s policy of charging fees for non-specially trained animals implicates the Fair Housing
Act. The Court has not made any findings with regard to whether other “ancillary” issues raised
in this litigation implicate the Fair Housing Act, including (1) whether Goldmark’s requirement
that tenants with assistance animals obtain a renter’s liability insurance policy, or (2) whether
Goldmark seeks unnecessary information when evaluating a requested accommodation for
assistance animals.
The Court noted in its Summary Judgment Order that “Plaintiffs contest a number of
issues in this litigation, including, for example, the rationale underlying the amount of fees
imposed for non-specially trained assistance animals, Goldmark’s inconsistent application of its
renters insurance requirement for persons with assistance animals, and whether unnecessary
information is required to evaluate the appropriateness of an applicant’s request for an assistance
animal.” Given the state of the record existing at that time, the Court concluded that “[t]o the
extent that Plaintiffs intend to persist in asserting these claims in light of the Court’s ruling
[regarding the fees charged by Goldmark], those are issues that will need to be resolved by the
trier of fact or as a matter of law at trial.” It appears Plaintiffs have interpreted the Court’s prior
order as determining these “ancillary” issues implicate the Fair Housing Act as a matter of law.
Such a determination has not been made.
With regard to the current motion, Plaintiffs now seek to certify two “classes” and a
“subclass” of plaintiffs. Plaintiffs have proposed the following two classes:
1.

All current tenants of residential properties operated by Goldmark who, at
any time since September 2, 2008, have occupied a dwelling with an
assistance animal pursuant to a reasonable accommodation granted to them
by Goldmark; and
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2.

All persons, who at any time since September 2, 2008, occupied a dwelling
operated by Goldmark with an assistance animal pursuant to a reasonable
accommodation granted to them by Goldmark, or who obtained or attempted
to obtain a reasonable accommodation for an assistance animal at a
residential property operated by Goldmark, and who
A.

Submitted a reasonable accommodation request on
Goldmark’s form on or after September 2, 2008; or

B.

Were charged an assistance animal processing fee; or

C.

Were charged a non-refundable assistance animal fee; or

D.

Were charged monthly assistance animal rent; or

E.

Obtained renters’ liability insurance to satisfy Goldmark’s
condition for exercising their granted reasonable
accommodation.

For ease of reference, the Court will refer to the first proposed class as the “Current
Tenant Class” and the second proposed class as the “All Tenant Class.” With regard to the “All
Tenant Class”, Plaintiffs propose an additional subclass:
All persons since September 2, 2008, who obtained a reasonable accommodation for
an assistance animal at a residential property operated by Goldmark, but who were
deterred from exercising their granted reasonable accommodation by the conditions
imposed by Goldmark.
For relief, Plaintiffs seek injunctive and declaratory relief for the “Current Tenant Class” and
damages for the “All Tenant Class.”
DISCUSSION
The United States Supreme Court recently reiterated the long-standing principle that a
class action is “‘an exception to the usual rule that litigation is conducted by and on behalf of the
individual named parties only.’” Wal-Mart Stores, Inc. v. Dukes, - - U.S. - -, 131 S.Ct. 2541,
2550 (2011) (quoting Califano v. Yamasaki, 442 U.S. 682, 700-01 (1979)). Accordingly,

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Fed.R.Civ.P. 23 does not set forth a mere pleading standard. Rather, a party moving for class
certification “must affirmatively demonstrate” compliance with Rule 23. Dukes, 131 S.Ct. at
2551; See Coleman v. Watt. 40 F.3d 255, 258 (8th Cir. 1994) (noting the party seeking class
certification bears the burden of meeting the requirements of Rule 23). It might be necessary for
a court to look beyond the pleadings before deciding the certification questions. Dukes, 131
S.Ct. at 2551 (quoting General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 160
(1982)). Moreover, it is not uncommon for a court to touch on the merits of the case in order to
resolve whether class certification is appropriate. Id. While a court is not permitted to resolve
the merits of the claims, a class action may properly be certified only if the trial court is satisfied
“after a rigorous analysis” that the prerequisites of Rule 23(a) have been satisfied. Id.
The requirements of Rule 23(a) are often summarized as numerosity, commonality,
typicality, and adequate representation. Id. The class must meet all four requirements for
certification. Id. If all four requirements are met, a class must then also meet at least one of the
three requirements listed in Rule 23(b). In re St. Jude Med., Inc., 425 F.3d 1116, 1119 (8th Cir.
2005). District courts are afforded broad discretion in determining whether to certify a class. In
re Zurn Pex Plumbing Products Liability Litigation, 644 F.3d 604, 616 (8th Cir. 2011).
1. The “Current Tenant Class”
Plaintiffs seek to certify a class consisting of all current tenants residing in a property
managed by Goldmark who since September 2, 2008, have occupied a dwelling with an
assistance animal pursuant to “the grant of a reasonable accommodation request.” For relief they
seek a declaration that Goldmark’s policies pertaining to the reasonable accommodation request
violate the Fair Housing Act and an injunction prohibiting Goldmark from continuing to enforce

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the policies.
It is axiomatic that a district court may not certify a class if it contains members who
lack standing. In re Zurn Pex Plumbing Products Liability Litigation, 644 F.3d at 616. To
demonstrate standing, a plaintiff bears the burden of establishing “injury in fact that is fairly
traceable to the challenged action of the defendant, and likely to be redressed by a favorable
decision.” Id. (quoting Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 591 (8th Cir. 2009)).
The putative class includes individuals that arguably have not suffered an “injury in fact”
traceable to Goldmark’s actions. There is at least one identified individual residing in a
Goldmark-managed property in the North Dakota region with an assistance animal that does not
have to comply with Goldmark’s assistance animal policy at issue in this litigation. (See Doc.
#196, Supplemental Declaration of Lacey Anderson). That individual is thus “grandfathered in”
and arguably may not have suffered an “injury in fact” entitling her to redress—certainly she has
not suffered the same injury as those class members required to pay the additional assistance
animal fees. There may be more individuals “grandfathered in” who are included in Plaintiffs’
proposed class. The Court cannot tell from the records provided by the parties who has been
required to pay the additional fees and who has not. Plaintiffs also seek to include tenants
occupying Goldmark-managed properties in Iowa, Nebraska, and the Minneapolis regions.
However, it is undisputed that Goldmark does not charge additional fees for assistance animals in
these regions. These individuals arguably lack a cognizable claim implicating the Fair Housing
Act and have not suffered an injury in fact entitling them to redress.
At this stage in the litigation, Plaintiffs proposed class is so inclusive that it includes

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individuals who lack standing.1 Accordingly, Plaintiffs’ putative class of current tenants cannot
be certified for failure to establish every member suffered an injury in fact likely to be redressed
by a favorable decision. In re Zurn Pex Plumbing Products Liability Litigation, 644 F.3d at 616.
Because an amended class definition could be presented to the Court to cure the standing issue,
for completeness the Court will proceed to consider the requirements of Rule 23(a).
A.

Numerosity

Although there is no definitive rule regarding the necessary class size to meet the
numerosity requirement, the plaintiff bears the burden of establishing that numerosity exists.
Belles v. Schweiker, 720 F.2d 509, 515 (8th Cir. 1983). A number of factors are relevant to this
inquiry, and the most obvious is the number of persons in the proposed class. In addition to the
size of the class, a court may also consider the nature of the action, the size of the individual
claims, the inconvenience of trying individual suits, and any other factor relevant to the
practicability of joining all the putative class members. Paxton v. Union Nat’l Bank, 688 F.2d
552, 559 (8th Cir. 1982).
Plaintiffs estimate there are at least 170 persons who made a reasonable accommodation
request to Goldmark and are current tenants. (Doc. #182-1, p. 14). Plaintiffs assert the records
provided by Goldmark identify over 300 proposed class members, but Plaintiffs only attached the
first page listing 30 individuals (Doc. #182-1, p. 11). Each of the listed individuals occupy or
occupied a dwelling in Bismarck, North Dakota. Some of these listed individuals are no longer
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To the extent Plaintiffs claim that the mere request for, or completion of, the reasonable
accommodation request form or the requirement to obtain a renter’s liability policy implicates the
Fair Housing Act, the Court has not determined either of those requirements implicate the Fair
Housing Act. Plaintiffs with these claims stand in a different legal position than those
individuals who have paid Goldmark’s fees for non-specially trained assistance animals and
which the Court has found implicate the Fair Housing Act.
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residents. Some of these listed individuals were denied the requested accommodation for reasons
that are unknown. From the evidence provided, the Court can discern only 20 individuals that
have actually paid the assistance animal non-refundable fee and monthly fee. Of significance, the
location of the remaining proposed class members is unknown. As the Court previously noted,
individuals located in Iowa, Nebraska, and the Minneapolis region are not similarly situated, as
Goldmark does not have assistance animal fees in these regions.
The information presented by Plaintiffs does not accurately establish with any reasonable
certainty the approximate size of the class. Plaintiffs have failed to meet their burden of showing
that the class is so numerous that joinder of all members is impracticable. Wal-Mart, 131 S.Ct. at
2551 (plaintiffs must prove there are in fact sufficiently numerous parties before certification can
be granted).
B.

Commonality

The commonality requirement of Rule 23(a)(2) is satisfied when the legal question
“linking the class members is substantially related to the resolution of the litigation.” Paxton,
688 F.2d at 561. This requirement is easily misread, as “any competently crafted class complaint
literally raises common questions.” Dukes, 131 S.Ct. at 2250 (citation omitted). Nonetheless,
evidence amounting to “significant proof” that a defendant operated under a “general policy of
discrimination” may be sufficient to establish commonality. Id. at 2253 (quoting Falcon, 457
U.S. at 159).
Goldmark has a policy of charging fees for non-specially trained assistance animals. This
is sufficient to establish commonality. Dukes, 131 S.Ct. at 2251 (“[Class members'] claims must
depend upon a common contention.... That common contention, moreover, must be of such a

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nature that it is capable of classwide resolution—which means that 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.”). Because Plaintiffs’ claims are based on a policy itself, not any discretionary actions by
a manager or other employee, this case does not give rise to the same concerns expressed by the
Supreme Court in Dukes. In that case, there was no policy and the plaintiffs failed to identify a
common mode of exercising discretion pervading the entire company in their proposed Title VII
discrimination class action. While Goldmark contends its policy does not violate the Fair
Housing Act, that issue goes exclusively to the merits of Plaintiffs’ claims. The commonality
requirement of Rule 23(a) is satisfied.
C.

Typicality

The third requirement of Rule 23(a)(3) is that “the claims or defenses of the
representative parties are typical of the claims or defenses of the class.” Fed.R.Civ.P. 23(a).
“Commonality” and “typicality” are separate but related requirements of class certification.
DeBoer v. Mellon Mortg. Co., 64 F.3d 1171, 1174-75 (8th Cir. 1995). In DeBoer the Eighth
Circuit Court of Appeals explained:
[c]ommonality is not required on every question raised in a class action. Rather,
Rule 23 is satisfied when the legal question “‘linking the class members is
substantially related to the resolution of the litigation.’” . . . The burden of
demonstrating typicality is fairly easily met so long as other class members have
claims similar to the named plaintiff.
Id. at 1174-75 (citations omitted).
Generally, when the relief sought is the same, the presence of factual variations is
normally not sufficient to preclude class certification. Donaldson v. Pillsbury Co., 554 F.2d 825,

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831 (8th Cir. 1977) (citations omitted). However, the factual variations in this case are critically
important. Plaintiffs seek to represent individuals who have paid Goldmark’s assistance animal
fees, those who have an assistance animal but have not paid any fees because they are
“grandfathered in,” and those who have an assistance animal but have not paid any fees because
Goldmark has no such policy in their region. Contrary to Plaintiffs’ contentions, it is improper
for this Court to assume tenants of Goldmark-managed properties residing outside of the North
Dakota region may one day suffer an injury because Goldmark might change its policies in those
regions.
“The presence of a common legal theory does not establish typicality when proof of a
violation requires individualized inquiry.” Elizabeth M. v. Montenez, 458 F.3d 779, 787 (8th
Cir. 2006). This is true even where injunctive relief is sought. Parke v. First Reliance Standard
Life Ins. Co., 368 F.3d 999, 1004-05 (8th Cir. 2004). Here, given the broad class of putative
class members - all current tenants since September 2, 2008, who have an assistance animal in a
Goldmark-managed property - the fact-finder will have to make a case-by-case determination as
to whether the Fair Housing Act was violated as to each member and whether he or she is
entitled to any relief. The putative class members do not necessarily share the same injury and
do not find themselves in the same legal position, as some have claims in which the Court has
found implicate the Fair Housing Act and some have claims that the Court has made no such
determination. Plaintiffs have failed to establish the typicality requirement. There are simply too
many individual issues to satisfy the typicality requirement.

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D.

Adequate Representation

Rule 23(a)(4) requires that the named representative must be able to fairly and adequately
protect the interests of class members. To meet this requirement, the named plaintiff must be a
member of the class she seeks to represent. East Texas Motor Freight Sys., Inc. v. Rodriguez,
431 U.S. 395, 403 (1977). In addition, the class representative must possess the same interest
and suffer the same injury as the class members. Id.
Plaintiffs seek the appointment of Kristina Hilde and Lacey Anderson to represent the
“Current Tenant Class.” As already noted, Plaintiffs have failed to demonstrate the putative class
members share the same injury and all possess legal standing to bring their claims. The claims of
the proposed representatives thus cannot be said to be typical of the entire class and, as such, the
representatives cannot fairly and adequately represent the interests of the class as a whole.
Plaintiffs must establish all four of the requirements of Rule 23(a). They have failed to
meet their burden of proof on three of the four requirements. Their motion for class certification
is DENIED.
2.

The “All Tenant Class”

Plaintiffs also seek to certify a class including “all persons” occupying a Goldmarkmanaged property since September 2, 2008 who either were granted a reasonable accommodation
or obtained or attempted to obtain a reasonable accommodation for an assistance animal and
either (a) completed the reasonable accommodation request form, or (b) were charged fees
relating to the assistance animal, or (c)were required to obtain a renter’s liability insurance

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policy.2 For relief, Plaintiffs seek an award of damages, including a refund of payments,
reimbursement for out-of-pocket expenses, and compensation for emotional distress.
For some of the same reasons outline above, Plaintiffs’ putative class seeking damags
fails to meet the requirements of Rule 23(a). Again, the proposed class is overly inclusive
resulting in a wide range of potential claims. It includes individuals who have occupied a
dwelling managed by Goldmark and it includes those who have never occupied a dwelling but
merely inquired about residing with an assistance animal. It also includes individuals who have
paid fees to reside with assistance animals and those who have not paid any fees. The proposed
class members, while all challenging Goldmark’s policies regarding non-specially trained
assistance animals, do not have the same grievance and do not find themselves in the same legal
position to assert a claim. Given the extremely broad proposed class, resolution of the purported
common legal issue would require individual factual determinations. Plaintiffs have failed to
meet the requirements of Rule 23(a).
Plaintiffs also seek to certify a subclass consisting of “all persons” who were deterred
from exercising their “granted reasonable accommodation” to have an assistance animal because
of the conditions imposed by Goldmark. Plaintiffs assert 67 persons were approved for the
requested reasonable accommodation but decided not to reside with an assistance animal.

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Plaintiffs have asserted Goldmark’s form requesting an accommodation for an assistance
animal requires unnecessary information and its requirement regarding renter’s liability insurance
implicate the Fair Housing Act. In contrast to the fee issue, this Court has not found either of
these claims implicate the Fair Housing Act. The Court expresses no opinions on the merits of
these “ancillary” issues other than to observe the legal issues surrounding the claims are
different, rendering them inappropriate for resolution as part of a class action involving the fee
issues.
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However, they have only identified a single person that actually fits in their proposed subclass.
Plaintiffs contend “[i]t is reasonable to assume that a majority, if not all, were persons who
obtained accommodations but were deterred from exercising their right because of the conditions
imposed by Goldmark on its exercise.” (Doc. #182-1, p. 14).
The law does not require exact evidence of class size. It does, however, provide that a
class action determination may not be based on mere speculation. Riedel v. XTO Energy, Inc.,
257 F.R.D. 494, 506 (E.D. Ark. 2009) (quoting Newberg on Class Actions, § 3.5 (4th ed.)). A
good-faith estimate should be sufficient when the number of class members is not readily
ascertainable. Id. Plaintiffs have failed to identify a single other individual that fits within the
proposed class. Despite having a list of potential class members, Plaintiffs simply speculate that
a majority of persons were deterred because of Goldmark’s policies. This is not enough. See
Saey v. CompUSA, Inc., 174 F.R.D. 448, 451 (E.D. Mo. 1997) (class certification properly
denied when the plaintiff presents evidence of only one arguable class member). With regard to
their proposed subclass, Plaintiffs have failed to demonstrate the impracticability of joinder under
Rule 23(a).
Having failed to satisfy the requirements of Rule 23(a) as to each proposed class and
subclass, the Court need not analyze the requirements under Rule 23(b).
DECISION
Following a “rigorous analysis” of the proposed classes and subclass, Plaintiffs have
failed to meet their burden of establishing all of the requirements under Rule 23(a) for class
certification. For the foregoing reasons, Plaintiffs’ motion for class certification is DENIED in

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its entirety.
IT IS SO ORDERED.
Dated this 20th day of September, 2011.
/s/ Ralph R. Erickson
Ralph R. Erickson, Chief Judge
United States District Court

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