Does a CFA Claimant Need to Plead “But for” Causation?

Seth J. Lapidow and Ethan M. Simon

New Jersey courts appear to be trending toward requiring Consumer Fraud Act (CFA) claimants to plead “but for” causation to survive dismissal. On Aug. 23, Judge Anne E. Thompson of the U.S. District Court for the District of New Jersey dismissed a class action CFA claim Rudel Corporation filed against Heartland Payment Systems, a credit and debit processor. See Rudel Corp. v. Heartland Payment Systems, No. 16-2229, 2016 WL 4472944 (D.N.J. Aug. 23, 2016). According to the complaint in Rudel, the plaintiff operated a restaurant and used Heartland to process credit card transactions. In spring 2014, Heartland sent a letter to Rudel and other clients announcing a new program through which Heartland would charge a lower rate on American Express transactions. Several months later, Heartland indicated on Rudel’s monthly account statement that it had incorrectly calculated the rates for the new American Express program and had to adjust the rates. Allegedly, Heartland also retroactively charged the increased rate. Continue reading “Does a CFA Claimant Need to Plead “But for” Causation?”

Judicial Economy and Joined Plaintiffs

The All-Important Factors for Class “Numerosity”

Richard Wolf

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On September 13, 2016, the United States Court of Appeals for the Third Circuit set forth for the first time a “non-exhaustive list” of factors for a District Court judge to consider when determining whether joinder would be impracticable for purposes of the class action “numerosity” requirement. In re Modafinil Antitrust Litigation, No. 15-3475 (3d Cir. Sept. 13, 2016). These factors include (1) judicial economy, (2) the claimants’ ability and motivation to litigate as joined plaintiffs, (3) the financial resources of class members, (4) the geographic dispersion of class members, (5) the ability to identify future claimants, and (6) whether the claims are for injunctive relief or for damages. Id. at *31-32.

In order to gain class certification, a putative class must satisfy a number of requirements, including that “the class is so numerous that joinder of all members is impracticable.” F.R.C.P. 23(a)(1). The Rule does not define “numerous,” and it is left to the Court to decide on a case-by-case basis whether a particular putative class meets this requirement. Despite the need for individualized factual analysis, a class of 20 or fewer is generally too small and a class of over 40 is usually sufficiently numerous. In re Modafinil at *24-25. While the Court noted that “the number of class members is the starting point of our numerosity analysis,” id. at *25, the Court focused on whether joinder is impracticable. Continue reading “Judicial Economy and Joined Plaintiffs”