NJ Court Considers Defendant’s Conduct, In Part, In Rejecting Ascertainability Doctrine

Class action practitioners and companies who have encountered class action lawsuits in recent years are undoubtedly aware of the ascertainability doctrine, which, particularly in the 3rd Circuit, has been successfully used to challenge class certification. The ascertainability doctrine requires that a class definition must be sufficiently definite so that it is administratively feasible for the court to determine whether a particular person is a member of the proposed class, and the identity of the class members must be identified by reference to objective criteria. Courts applying the doctrine essentially have found it to be an implicit requirement of Rule 23.

In a matter of first impression, in Daniels v. Hollister Co., a New Jersey appellate court affirmed an order granting class certification, concluding that ascertainability “must play no role in considering the certification of a low-value consumer class action … .”  The Plaintiff in that case alleged that he purchased $75 worth of merchandise at a Hollister store as part of a promotion by which he obtained a $25 gift card, but was never advised of an expiration date.  Hollister subsequently voided outstanding gift cards approximately a year after his purchase and he was unable to make use of his card.

While the court focused on New Jersey’s liberal interpretation of its class certification requirements (R. 4:32-1) in rejecting an ascertainability factor, the court commented that an ascertainability requirement would be particularly inappropriate when difficulties in identifying class members resulted from the defendant’s own acts or omissions. The court noted that if Hollister had obtained identities of the consumers who obtained the gift cards, the alleged lack of objective criteria to identify class members (which Hollister argued should preclude certification) would not have been an issue.

From a defense perspective, the court’s reference to protecting “low-value consumer action” is troubling inasmuch as claims deemed “low-value” to a consumer or court could obviously have a severe cumulative financial impact on a defendant cumulatively. Defendants should be entitled all due process protections, including an assessment of class ascertainability.

Of course, this case will be followed to see if any action is taken on the New Jersey Supreme Court level.

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