Mielo v. Steak ‘n Shake Operations, Inc., 897 F.3d 467 (3d Cir. 2018). This was an appeal under Rule 23(f) of the Federal Rules of Civil Procedure from a District Court decision that granted class certification in this case under the Americans With Disabilities Act, 42 U.S.C. §12101 et seq. (“ADA”). Plaintiffs were two disability rights advocates. They asserted that sloped parking facilities at two Steak ‘n Shake restaurants operated by defendant violated the ADA, and that plaintiffs themselves had suffered concrete injury by being unable to navigate those parking areas in their wheelchairs. Plaintiffs sought not only to remedy the conditions at the parking areas of the two Steak ‘n Shake locations that they had found inaccessible, they also sought to compel defendant to adopt corporate policies that would require defendant to actively seek out and remedy potential discriminatory access violations at 417 Steak ‘n Shake locations where defendant operates or controls parking.
There were two issues on appeal: whether plaintiffs had standing, and whether an injunctive relief class under Federal Rule of Civil Procedure 23(a)(2) was properly certified. Writing for the panel, Chief Judge Smith ruled that plaintiffs had standing, but that the certification of the class was error. The panel reviewed the class certification decision under the abuse of discretion standard, while applying de novo review to the legal standards that the District Court employed in certifying the class.
Chief Judge Smith began his standing analysis by citing the three-part test for standing that appeared in Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016). That test requires a plaintiff to have “(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” The “injury in fact” prong, in turn, is itself “actually a conglomerate of three components,” Chief Judge Smith said. Those are “an invasion of a legally protected interest,” injury that is “concrete and particularized,” and injury that is “actual or imminent, not conjectural or hypothetical.”
Plaintiffs met all of the criteria for standing. They presented “a colorable argument that the ADA requires Steak ‘n Shake to adopt new policies requiring them to actively seek out and correct access violations.” That satisfied the “invasion of a legally protected interest” factor for injury in fact. Plaintiffs’ allegations that they had “experienc[ed] actual physical difficulty in ambulating through parking facilities that which are allegedly not ADA-compliant” satisfied both the “concrete and particularized” and “actual or imminent” criteria, since that difficulty had already occurred to plaintiffs themselves. That took care of “injury in fact.”
The “traceability” and “likely to be redressed” prongs likewise were satisfied. Chief Judge Smith noted that, plaintiffs’ “burden of establishing causation at the pleadings stage is less stringent” than it would be during a merits phase of the case, but that plaintiffs had met that lesser burden and thereby satisfied “traceability.” And though plaintiffs’ proffered forms of injunctive relief did not themselves ensure “that an allegedly non-compliant parking facility slope be corrected,” a favorable judicial decision was still “likely” to remedy plaintiffs’ injury in fact. Nothing suggested that individual Steak ‘n Shake locations would disobey a new corporate policy requiring the company to seek out and correct access violations. Thus, plaintiffs had standing.
Turning to class certification, Chief Judge Smith recognized that “this civil rights action under the ADA is indeed the type of action for which Rule 23(b)(2) [injunctive class actions] was originally designed.” But in these particular circumstances, plaintiffs did not satisfy the numerosity or commonality criteria of Rule 23(a).
The panel first called attention to a legal error by the District Court. Relying on Eisenberg v. Gagnon, 766 F.2d 770 (3d Cir. 1985), the District Court stated that doubts concerning class certification should be resolved in favor of certification. Chief Judge Smith observed, however, the In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305 (3d Cir. 2008), and subsequent authority, had made clear that the “relaxed” standard of Eisenberg had not survived amendments to Rule 23 that were made in 2003. Under current law, he emphasized “(hopefully for the last time),” if a court harbors doubt about class certification, it should be denied.
Chief Judge Smith found that plaintiffs had failed to demonstrate numerosity (that is, a class of at least 40 members) by a preponderance of the evidence. Plaintiffs had offered census data showing between 14.9 million and 20.9 million persons with mobility disabilities who live in the United States. An executive of defendant had stated that it would be “fair” to say that “thousands of people with disabilities utilize [Steak ‘n Shake] parking lots … each year.” Plaintiffs contended that applying “common sense” to those two facts led to the conclusion that numerosity was present.
The panel disagreed, labeling it mere “speculation” that because there are millions of mobility-impared residents in the United States, at least 38 such people besides plaintiffs had gone to Steak ‘n Shake restaurants. The court also dismissed as speculation the statement of the executive, who was in a position to know, rather than merely guess about, the volume of persons with disabilities who came to defendant’s establishments. Numerosity is a requirement of Rule 23(a) that plaintiffs must prove, but this decision borders on fetishizing that requirement so as to deny class certification in meritorious cases.
Plaintiffs also contended that In re Modafinil Antitrust Litig., 837 F.3d 238 (3d Cir. 2016), relaxed the standard for numerosity in injunctive class cases as compared to damage class cases. Chief Judge Smith rejected that argument after analyzing and clarifying Modafinil.
Plaintiffs also lost on the commonality requirement, which calls for the presence of at least one common question of law or fact. The definition of the class that the District Court adopted was broader than just “parking facilities” and referred instead to “accessibility barriers” generally. The panel cited dozens of other potential areas in which defendant’s facilities might pose accessibility problems. “With such a potentially wide array of different claims by members of the class, we conclude that the certified class fails to meet the commonality requirement of Rule 23(a)(2).” The panel remanded the matter to the District Court, where “the parties may present the court with a newly-formulated class definition free of the Rule 23(a) deficiencies described above.”