Adrienne C. Rogove
In another blow to plaintiffs suing under New Jersey’s Truth-in-Consumer Contract, Warranty, and Notice Act (“TCCWNA”), the United States District Court for the District of New Jersey in Martinez-Santiago v. Public Storage, 2019 WL 1418118 (D.N.J. March 29, 2019), decertified a class of 160,000 members alleging that lease agreements with the Defendant Public Storage violated TCCWNA. Following the New Jersey Supreme Court’s decision last year finding that a consumer who is a party to a contract that fails to comply with New Jersey law, but who does not suffer any adverse consequences from the noncompliance, has failed to state a TCCWNA claim, United States District Judge Jerome Simandle decertified the class. The decision was based on an analysis of the Rule 23 requirements, where the Court held that the requirements of “typicality,” “predominance,” and “numerosity” under Rule 23 could not be met.
With respect to the typicality requirement, the Court found that the named plaintiff was one of “relatively few” customers who actually suffered an adverse consequence due to the form lease contract entered into with Public Storage. Since the vast majority of class members did not suffer an adverse consequence, the claims of the named plaintiff were not typical of the class members, and therefore the typicality requirement was not met.
The Court also found that the “predominance” requirement could not be met because questions of fact common to class members no longer predominated over questions affecting only individual claims. Finally, because discovery revealed that only 29 class members might be able to assert a viable claim under TCCWNA, the “numerosity” requirement of Rule 23 likewise could not be met.
The decision of the Court in Martinez-Santiago left only the named plaintiff with potentially viable claims, thereby continuing to chip away at the prospect of successful class action suits against corporate entities, and large attorneys’ fee awards to class action counsel, in suits where the class cannot meet the requirements of Federal Rule of Civil Procedure 23.
Consumer class action litigation—often accusing the defendant company of deceiving its customers—strikes at the heart of a company’s reputation, goodwill, and brand—all of which are often built over the course of many years or decades. As such, these cases pose not only the threat of immense litigation and liability costs, but also irreparable, and potentially fatal, future damage to the company’s brand. By way of recent example, for the past several years, a putative class of plaintiffs from several states took aim at Tropicana’s Pure Premium (“TPP”) orange juice, claiming that the company deceived and misrepresented the public concerning its popular orange juice.