United States District Court, N.D. California
April 13, 2004.
KAREN ROBERTSON, as Trustee of the Trust of Lloydine Ann Reese, and TERRA SAKS-YOUNG, on behalf of themselves, all others similarly situated, and the general public, Plaintiffs,
NORTH AMERICAN VAN LINES, INC., a Delaware Corporation, Defendant
The opinion of the court was delivered by: SAMUEL CONTI, Senior District Judge
Presently before the Court is Plaintiffs' motion for class
certification pursuant to Rule 23 of the Federal Rules of Civil
Procedure. Plaintiffs seek to certify a class of customers who employed
Defendant North American Van Lines ("Defendant" or "North American") to
move their household goods and who were injured by North American's
allegedly deceptive and unlawful business practices. Having read
Plaintiffs' complaint and the papers submitted in connection with this
motion and for the reasons articulated below, the Court hereby denies
Plaintiffs' motion for class certification. II. BACKGROUND
A more complete discussion of the circumstances leading up to the
filing of this action can be found in this Court's January 22, 2004
Order. For now however, a shorter recitation will suffice. The two named
Plaintiffs, Karen Robertson*fn1 and Terra Saks-Young, are former
customers of North American. Each of them contracted with North American
to move their household belongings across the country, and each received
a final bill that was considerably higher than the original estimate that
North American had provided. Plaintiffs allege that these instances are
part of North American's widespread and deceptive practice of baiting
consumers with reasonable, written estimates, then increasing the charges
to artificially-inflated amounts and holding consumers' household
belongings hostage until the artificially-inflated amount is paid. Pls.'
First Amended Compl. ("FAC") at ¶ 1. Plaintiffs contend this practice is
in direct violation of federal regulations that require motor carriers to
provide "reasonably accurate estimates" and, under certain circumstances,
not to charge more than 110% of the estimated price. See
49 C.F.R. § 375.3(b), 375.3(d) (2002)*fn2. Plaintiffs also contend that Defendant routinely
violates several other federal regulations that govern motor carriers,
namely, the requirements that a motor carrier provide notice to consumers
when their goods are going to be weighed, that a carrier only use
certified scales in conducting such weighings, and the requirement
regarding the amount of fuel that can be in the tank of the moving truck
at the time of each weighing. See 49 C.F.R. § 375.7(a)7;
49 C.F.R. § 375.7(a); 49 C.F.R. § 375.7(a)(3), respectively.
On May 21, 2003, Plaintiffs filed the instant action before this Court. Plaintiffs filed an amended complaint on November 5,
2003, which listed four causes of action: 1) breach of contract; 2)
violation of the Consumers Legal Remedies Act, California Civil Code §
1750, et seq.; 3) violation of California Business and Professions Code
§ 17200; and 4) violation of federal statute 49 U.S.C. § 14704(a)(2).
Plaintiffs' claim under 49 U.S.C. § 14704(a)(2) is based on Defendants'
alleged violations of the federal regulations listed above regarding
reasonable estimates, notice of weighing, etc.
In the January 22, 2004 Order, this Court dismissed Plaintiffs' first
three causes of action on the grounds that they were preempted by federal
law. The Court found that the federal regulatory scheme governing the
interstate transportation of household goods is so pervasive as to make
reasonable the inference that Congress left no room for state law to
operate in this area. Plaintiffs, with their remaining claim for relief,
now seek to certify a class on behalf of:
All persons and entities through the United States and
its territories who contracted with North American Van
Lines, Inc. ("Defendant") to move household goods
based on "Named Shipper Option" written estimates
during the period January 1, 1999 to the present (the
"Class Period") and whose final charges prior to
delivery were in excess of 110% of the estimated cost
as a result of a variance between the last written
estimated weight rendered by Defendant prior to
complete loading and the purported actual weight determined by
Defendant after loading.
Pls.' FAC at ¶ 16. Plaintiffs contend that this class has been injured
by Defendant's systematic and uniform violation of several federal
regulations governing the conduct of motor carriers. Plaintiffs seek
restitution, compensatory damages, declaratory and injunctive relief, and
attorneys' fees and costs. Pls.' FAC, ¶ 73. Plaintiffs further request
that Karen Robertson be appointed as class representative and that
Plaintiffs' counsel be certified as class counsel. Plaintiffs assert they
have met the requirements under Fed.R.Civ.P. 23(a) and that this action
can be certified by the Court under both 23(b)(2) and 23(b)(3). After
reviewing Plaintiffs' complaint and the papers submitted in connection
with this motion, the Court finds that Plaintiffs cannot satisfy the
requirements under Fed.R.Civ.P. 23(b) and therefore deny Plaintiffs'
motion for class certification.
III. LEGAL STANDARD
A. Motion for Class Certification
Class actions are governed by Rule 23 of the Federal Rules of Civil
Procedure. The party seeking class certification bears the burden of
demonstrating that all four requirements under Rule 23(a) have been met
and at least one of the requirements of Rule 23(b). However, whether to
certify a class is within the "trial court's considered discretion." Doninger v. Pacific Northwest Bell, Inc., 564 F.2d 1304, 1309 (9th Cir.
1977) (quoting Price v. Lucky Stores, Inc., 501 F.2d 1177, 1179 (9th
Cir. 1974)). Before certifying a class, the court "must conduct a
`rigorous analysis' into whether the prerequisites of Rule 23 are met."
Valentin v. Carter-Wallace, Inc., 97 F.3d 1227 (9th Cir. 1996)(citing In
re American Medical Sys., 75 F.3d 1069 (6th Cir. 1996).
1. Rule 23(a)
Rule 23(a) lists four prerequisites to a class action: 1) the class
must be so numerous that joinder is impracticable; 2) there are common
questions of law or fact; 3) the claims and defenses of the class
representative are typical of those of the class; and 4) the class
representative will fairly and adequately represent the interests of the
In addition to meeting the requirements of Rule 23(a), the parties
seeking class certification must also show that the action is
maintainable under Fed.R.Civ.P. 23(b)(1), (2), or (3). Hanlon v. Chrysler
Corp., 150 F.3d 1011, 1022 (9th Cir. 1998)(citing Amchem Products, Inc.
v. Windsor, 117 S.Ct. 2231, 2245 (1997)). In this case Plaintiffs propose
certification under both 23(b)(2) and 23(b)(3).
2. Rule 23(b)(2)
In order to certify a class under Rule 23(b)(2), Plaintiffs must show
that Defendant "has acted or refused to act on grounds generally
applicable to the class, thereby making appropriate final injunctive
relief or corresponding declaratory relief with respect to the class as a
whole. . . . " Fed.R.Civ.P.23(b)(2). In addition, "[c]lass actions certified under Rule
23(b)(2) are limited to those cases where the primary relief sought is
injunctive or declaratory relief." Barabin v. Aramark Corp., 2003 WL
355417, *1 (3rd Cir.); see also James v. City of Dallas, 254 F.3d 551,
571 (5th Cir. 2001) (stating that "To maintain an action under Rule
23(b)(2), [injunctive] relief rather than monetary damages must be the
predominant form of relief the plaintiffs pursue."). If a plaintiff
seeking certification under Rule 23(b)(2) has requested money damages as
part of his relief, "[T]he claim for monetary damages must be secondary to
the primary claim for injunctive or declaratory relief." Molski v.
Gleich, 318 F.3d 937, 947 (9th Cir. 2003).
3. Rule 23(b)(3)
In order to certify a class under Rule 23(b)(3), Plaintiffs must show
that " [T]he questions of law or fact common to the members of the class
predominate over any questions affecting only individual members, and that
a class action is superior to other available methods for the fair and
efficient adjudication of the controversy." Fed.R.Civ.P. 23(b)(3). "The
Rule 23(b)(3) predominance inquiry tests whether proposed classes are
sufficiently cohesive to warrant adjudication by representation."
Hanlon, 150 F.3d at 1022, (quoting Amchem Products, 117 S.Ct. at 2249).
Even if Rule 23(a)'s commonality requirement may be satisfied, the
predominance inquiry under Rule 23(b)(3) is far more demanding. Amchem
Products, 117 S.Ct. at 2231. Rule 23(b)(3) presumes the existence of common issues of fact or law and focuses on the relationship
between the common and individual issues. "Thus, the court must determine
whether common issues constitute such a significant aspect of the action
that `there is a clear justification for handling the dispute on a
representative rather than on an individual basis.'" O'Connor v. Boeing
North American, Inc., 180 F.R.D. 359, 379 (C.D.Cal. 1997)(quoting Charles
Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and
Procedure: Civil 2d § 1778 at 528 (1986).
A party seeking class certification must establish the requirements
under both Rule 23(a) and 23(b). Because in this case Plaintiffs cannot
establish the requirements for class certification under Rule 23(b),
there is no need for the Court to analyze Plaintiffs' showing under
Plaintiffs seek certification under Rule 23(b)(2) and 23(b)(3). With
respect to the former, it is not disputed that Plaintiffs seek to recover
significant monetary damages here. Plaintiffs request restitution,
compensatory damages (including "treble damages for the Senior Citizen
Sub-Class"), prejudgment interest, and attorneys' fees and costs. Pls.'
FAC at ¶ 73. Plaintiffs contend that their claim for monetary damages
does not prevent certification under Rule 23(b)(2) because "injunctive
and declaratory relief are important aspects of this litigation. . . . "
Pls.' Reply Mot. at 12. While this may be true, it does not come close to satisfying Plaintiffs' burden
for class certification under Rule 23(b)(2).
The Ninth Circuit has been clear that in order to permit certification
under this rule, "the claim for monetary damages must be secondary to the
primary claim for injunctive relief." Molski, 318 F.3d at 947. In
reviewing the complaint in the case at bar, we cannot find that the
primary relief sought is injunctive and/or declaratory in nature.
Plaintiffs' claim for monetary damages is equally if not more important
as their request for injunctive or declaratory relief with respect to
Plaintiffs' intent in bringing this action and what they hope to recover
from it. Indeed, the gist of Plaintiffs' grievance is that they were
forced to pay more money for their move than was required under the law.
The primary way to remedy such injuries is through restitution and
compensatory damages. In this case each putative Plaintiff will have a
different measure of monetary damages that will have to be proven at
trial, and it is clear to the Court that these damages are a significant
component of the relief Plaintiffs. Under such circumstances, we find
that Plaintiffs do not meet the criteria for class action certification
under Rule 23(b)(2). See Barabin v. Aramark Corp., 2003 WL 355417, *2
(3rd Cir.); Coleman v. General Motors Acceptance Corp., 296 F.3d 443, 447
(6th Cir. 2002).
Likewise, we find that Plaintiffs do not satisfy the requirements for
class certification under Rule 23(b)(3). Given the disparate
circumstances of the putative class members and the individualized relief they are seeking, the Court cannot find
that common questions will predominate or that a class action is the best
vehicle for resolution of this dispute. In this case Plaintiffs are suing
under 49 U.S.C. § 14704(a)(2), which makes a carrier liable for "damages
sustained by a person as a result of an act or omission of that carrier
or broker in violation of this part." Section 14704(a)(2) provides a
right to recover only to persons who have sustained damages as a result
of a carrier violation. A carrier's violation of federal regulations does
not, in and of itself, entitle a plaintiff to a recovery, as the
plaintiff must still prove damages. Thus, even if North American violated
various federal regulations with respect to the proposed class as a
whole, each member of the class still has to prove, based on their
individualized circumstances, what damages they suffered because of these
violations. Each member of the class will have a different measure of
damages based on a multitude of factors surrounding their particular
move. These individual questions will dominate trial of this action, both
in terms of time and significance, which demonstrates that this proposed
class is not sufficiently cohesive to warrant adjudication by
representation. See Owner-Operator Independent Drivers Ass'n. Inc. v. New
Prime, Inc., 339 F.3d 1001, 1012 (8th Cir. 2003) (holding that because "
49 U.S.C. § 14704(a)(2) provides a right to recover only to persons who
have sustained damages as a result of a carrier violation", "[r]ecovery
for any plaintiff would be based on individual, not common, questions of fact" and therefore class certification is inappropriate.);
Skipper v. Giant Food Inc., 68 Fed.Appx. 393, 397-398 (4th Cir. 2003)
(stating that " [T]he individualized measure of plaintiffs' claims for
damages reinforces the district court's conclusion that questions
affecting only individual members would predominate over common questions
of law or fact.")
In addition, many of the federal regulations Defendant is accused of
violating are fact intensive and will require inquiry into each
customers' course of dealing with Defendant. For example, the "110%
rule", around which Plaintiffs' complaint centers, cannot be adjudicated
with respect to an entire class of customers. This rule states that:
At the time of delivery of a collect on delivery
shipment, except when such shipment is delivered to a
warehouse for storage at the request of the shipper,
on which a non-binding estimate of the approximate
costs has been furnished by the carrier under the
provisions of paragraph (b), the shipper may request
delivery of the shipment upon payment, in a form
acceptable to the carrier, of an amount not exceeding
110 percent of the estimated charges. The carrier
shall, upon request of the shipper, relinquish
possession of the shipment upon payment of not more
than 110 percent of the estimated charges and shall
defer demand for the payment of the balance of any
remaining charges for a period of 30 days following
the date of delivery.
49 C.F.R. § 375.3(d). Thus, to establish that Defendant violated this
rule, each member of the class will have to show, inter alia, that they
requested to pay 110 percent of their estimate in a form acceptable to
the carrier and were denied possession of their goods. Such a
determination will center around communications between customers and
Defendant's representatives and will depend on the facts of each case.
This underscores the Court's determination that a class action simply is
not the best vehicle to resolve this dispute. There are too many
individual questions that must be answered to award Plaintiffs the relief
they have requested. In these circumstances, the Court finds that this
suit is best brought on an individual basis.
Because Plaintiffs cannot satisfy the requirements under Rule 23(b),
their Motion for Class Certification is HEREBY DENIED.
IT IS SO ORDERED.