A Retreat From the Third Circuit’s Misguided Class Action Ascertainability Doctrine, and a Wise Concurrence by Judge Fuentes

City Select Auto Sales, Inc. v. BMW Bank of North America Inc., 867 F.3d 434 (3d Cir. 2017).  Judge Scirica, who wrote the Hayes and Carrera opinions that form the backbone of the Third Circuit’s ascertainability doctrine in class action cases, authored this opinion for the Third Circuit.  The case arose under the Telephone Consumer Protection Act, 47 U.S.C. §227, alleging the receipt of an unauthorized fax sent on behalf of defendant BMW Bank of North America through defendant Creditsmarts Corporation.

Plaintiff, an auto dealer, sued on behalf of a class defined as “[a]ll auto dealerships that were included in the Creditsmarts database on or before December 27, 2012, with fax numbers identified in the database who were sent one or more facsimile messages between November 20, 2012 and January 1, 2013, that advertised the commercial availability of property, goods or services offered by ‘BMW Bank of North America.'”  After plaintiff’s motion to compel production of the Creditsmarts database was denied, the District Court denied class certification on the grounds that the class was not ascertainable.  Though the “potential universe of fax recipients” could be identified, “there is no objective way of determining which customers were actually sent the BMW fax.”

The Third Circuit granted plaintiff’s petition for an interlocutory appeal under Rule 23(f) and reversed the District Court.  After recapping the court’s ascertainability precedents, Judge Scirica ruled that there might be a reliable, administratively feasible method of ascertaining the class.  Plaintiff had proposed using the Creditsmarts database in combination with class member affidavits.  Though Carrera had rejected the use of class member affidavits to ascertain the class,  Judge Scirica said here that “[a]ffidavits, in combination with records or other reliable and administratively feasible means, can meet the ascertainability standard.”

Plaintiff was helped by the fact that the proposed class definition was premised on the Creditsmarts database, so that “[t]he only factual inquiry required to determine class membership is whether a particular dealership in the database received the BMW fax on one of the dates in question.”  Answering that question through affidavits was not necessarily administratively infeasible or an improper deprivation of defendants’ due process rights.

But without the Creditsmarts database, the court could not conclusively decide the issue.  Thus, the panel remanded the matter to the District Court, and stated that even if the database turns out to be over-inclusive, that would not be fatal to class certification.  “While a high degree of over-inclusiveness could prevent certification, any degree of over-inclusiveness will not do so.”

This was the right decision on the facts of this case, and a welcome retreat from the broad rejection in Carrera of affidavits as a potential means of identifying the class.  But Judge Fuentes, in a concurring opinion, was even more correct.  He advocated the rejection of the Carrera ascertainability test, which he rightly labeled as a “second” ascertainability requirement, the first one being “only that a class be defined in reference to objective criteria.”  Judge Fuentes noted that the Second, Sixth, Seventh, and Ninth circuits had all carefully considered the Carrera standard and rejected it.  In his view, it was time for the Third Circuit to abandon this “second” test.

Judge Fuentes was one of those who dissented from the denial of en banc review in Carrera, as discussed here.  His concurrence here was highly persuasive, joining the equally compelling concurrence of Judge Rendell in Byrd v. Aaron’s Inc., 784 F.3d 154 (3d Cir. 2015), discussed here.

Though the majority in this case did not go as far as Judge Fuentes wanted, its decision represents another step away from Carrera.  Looking at the bigger picture, though, the combination of the powerful separate opinions in this case, Byrd, and the Carrera en banc ruling, along with the rejection of Carrera by so many courts elsewhere, offers hope that the complete repudiation of Carrera by the Third Circuit en banc may soon be in the offing.