There has been a debate brewing among the circuits as to whether class members must be “ascertainable” in order for a class to be certified. Ascertainability is not a Rule 23 requirement, but rather, a judicially-created requirement that generally is designed to ensure that class definitions are adequate such that members of the class can be identified. While most, if not all, courts agree that class definitions must be objective and cannot define a class in terms of only those who would succeed on the merits (a so-called “fail safe” class), courts differ on how far to evaluate the class at the class certification stage.
The Third Circuit and the Seventh Circuit have taken opposite views of ascertinability. See, e.g., Marcus v. BMW of N. Am., LLC, 687 F.3d 583, 594 (3d Cir. 2012); Carrera v. Bayer Corp., 727 F.3d 300, 303-05 (3d Cir. 2013); Mullins v. Direct Digital, LLC, 795 F.3d 654 (7th Cir. 2015). See also Rikos v. Procter & Gamble Co., 799 F.3d 497 (6th Cir. 2015) (following Seventh Circuit). In the Third Circuit, ascertainability of the class has become a de facto class certification requirement. In the Seventh Circuit, the view is that the underlying issue of ascertainability is better addressed under the Rule 23(b) requirement that a class vehicle be the superior means to resolve the case, which means, among other things, that a class action be manageable.
Ascertainability matters for many reasons. For example, having an ascertainable class ensures that the number of class members is not inflated (remember, plaintiff must prove numerosity in order to obtain class certification). And it also allows defendants to better understand the breadth and scope of the litigation, and thereby test the allegations made against the class definition at class certification. And importantly, in some circumstances, there is an overly inclusive class because the uninjured are included within the class definition. Understanding who is in the class ensures that the uninjured are not included as part of the class. An uninjured plaintiff cannot bring a suit where he or she has not suffered an injury and/or damages in individual litigation, and there is no reason to allow such a litigant to proceed as part of a class. Indeed, the Rules Enabling Act forbids the class action rules from expanding such rights.
Recognizing the significance of the issue of ascertainability, the authors of suggested revisions to Rule 23 considered adding a section on ascertainability to the Rule. However, they ultimately declined to do so. There also has been legislation introduced in the House that would mandate that plaintiff prove at class certification that the class contains only those who have been injured. (H.R. 1927.) The U.S. Supreme Court’s recent Tyson decision fuels the debate, as it raises but does not resolve the question of whether the uninjured can receive damages as part of a class. In Mullins, the Seventh Circuit reasoned that the issue of who may receive damages can be resolved by bifurcating the liability and damages phases of class litigation, so that defendants could weed out the uninjured at the damages phase. The problem with this reasoning is three-fold. First, it does not address the issue of the initial inclusion of the uninjured in the class. Second, the bifurcation the Seventh Circuit suggests would undercut the Supreme Court’s Comcast ruling, in which the Court held that the existence of individualized damages can defeat class certification. And third, witness what happened in Tyson, where a damages model was permitted that included the uninjured. Not only is that a due process issue for defendants, but as Justice Roberts emphasized in that case, it is an Article III issue because a court cannot adjudicate a matter if there is no “case or controversy” — which there is not for those who have not been injured.
The Mullins case was recently before the U.S. Supreme Court on a certiorari petition on the following question: “Whether a court may certify a class under Federal Rule of Civil Procedure 23(b)(3) where the plaintiff fails to make any showing of a reliable and administratively feasible means for ascertaining class membership.” However, the Court denied the petition on February 29, 2016.
While it may appear that we are left in limbo at the moment on the question of ascertainability, as the Seventh Circuit suggests, in those circuits that do not consider the issue one of class definition, the proper way for a defendant to argue the issue may well be under the superiority prong of Rule 23(b)(3) (and maybe even under the little-used numerosity requirement of Rule 23(a)(1)). The bigger issue, it seems, is whether the ascertainability issue gets fought out at the certification or the liability phase. The bifurcation question is thus an important one as courts navigate ascertainability, injury and damages.