Eliminating a Hurdle for Class Plaintiffs, Eleventh Circuit Resolves “Hotly Contested” Issue: Administrative Feasibility is Not Required for Class Certification
The Eleventh Circuit Court of Appeals recently decided that “administrative feasibility is not a requirement for certification under Rule 23.” Cherry v. Dometic Corporation, No. 19-13242, 2021 WL 346121, at *5 (11th Cir. 2021). This change is expected to impose a less restrictive standard for putative class representatives looking for ascertainability and certification under Rule 23. It is also expected to lead to an increase in litigation in class action cases as previously barred potential classes — due to administrative feasibility issues — can now seek potential certification under Rule 23. Consequently, class defendants will have to adapt to the new change and move any objections to administrative feasibility into other relevant prongs of Rule 23(b)(3) to attempt to defend against ill-defined classes.
In making this landmark decision, a three-judge panel was asked to review the district court’s denial of class certification in a case, which claimed that Dometic Corporation sold potentially millions of consumers defective refrigerators for recreational vehicles. The putative class representatives “proposed a class consisting of all persons who purchased in selected states certain models of Dometic refrigerators that were built since 1997.” Id. at *1. They argued that “[t]he proposed class is ascertainable because the class definition relies exclusively on objective criteria” and “that class-member identification would be administratively feasible.” Id. In turn, “Dometic argued that ascertainability requires proof of administrative feasibility.” Id. The district court ruled in favor of Dometic, finding that “ascertainability requires proof of administrative feasibility.” Id.
In reviewing the district court’s decision, the three-judge panel was asked “whether putative class representatives must prove the existence of an administratively feasible method to identify absent class members as a precondition for certification of a class action under Federal Rule of Civil Procedure 23.” Id. at *1. After reviewing the requirements under Rule 23 and circuit precedent, the three-judge panel concluded that “Rule 23 provides no basis to require administrative feasibility.” Id.
Although the Eleventh Circuit had not conclusively decided whether Rule 23 required administrative feasibility as a requirement for certification under Rule 23 before its decision in Cherry, many district courts in Georgia, Alabama, and Florida, and even a non-published decision from the Eleventh Circuit seemed to suggest that administrative feasibility was a requirement for certification. See Karhu v. Vital Pharms., Inc., 621 F. App’x 945, 947–48 (11th Cir. 2015) (holding that “a plaintiff establishes Rule 23’s implicit ascertainability requirement by proposing an administratively feasible method by which class members can be identified.”); see also Stalley v. ADS Alliance Data Syst., Inc., 296 F.R.D. 670, 679–80 (M.D. Fla. 2013) (denying certification because “the Court ha[d] not been presented with reasonable methods for ascertaining the identity of the [class members, that is] individuals who answered [the defendant’s] collection calls”); Hill v. T–Mobile, USA, Inc., No. 2:09–cv–1827–VEM, 2011 WL 10958888, at *10–11 (N.D. Ala. May 16, 2011) (holding ascertainability not established where plaintiffs had proposed “creating a class list using T [–]Mobile’s databases,” because plaintiffs “ha[d] not addressed how to effectively back out from such a list” the identities of persons not eligible for class-action relief). In Cherry, the Court directly rejected the reasoning behind those decisions and concluded that “those decisions do not bind us as precedent.” Cherry, 2021 WL 346121, at *3.
In making its decision, the Court went on to discuss the circuit-split over the question of the proper role of administrative feasibility in assessing class certification. On one side of the split, the First, Third, and Fourth Circuits apply a heightened standard for ascertainability. See Byrd v. Aaron’s Inc., 784 F.3d 154, 163 (3d Cir. 2015); Nexium Antitrust Litig., 777 F.3d 9, 19 (1st Cir. 2015); EQT Prod. Co. v. Adair, 764 F.3d 347, 358–59 (4th Cir. 2014). On the other side, the Second, Sixth, Seventh, Eighth, and Ninth Circuits have refused to apply an administrative feasibility requirement under Rule 23. See In re Petrobras Sec., 862 F.3d 250, 267 (2d Cir. 2017); Rikos v. Procter & Gamble Co., 799 F.3d 497, 525 (6th Cir. 2015); Mullins v. Direct Digit., LLC, 795 F.3d 654, 662 (7th Cir. 2015); Sandusky Wellness Ctr., LLC v. Medtox Sci., Inc., 821 F.3d 992, 995–96 (8th Cir. 2016); Seeligson v. Devon Energy Prod. Co., 761 F. App’x 329, 334 (5th Cir. 2019).
In joining the latter Circuits, the Court stated that administrative feasibility is not an “inherent aspect” of ascertainability, saying that “membership can be capable of determination without being capable of convenient determination.” Cherry, 2021 WL 346121, at *4. Thus, it concluded that “[b]ecause administrative feasibility has no connection to Rule 23(a), it is not part of the ascertainability inquiry.” Id. The Court therefore limited “ascertainability to its traditional scope: a proposed class is ascertainable if it is adequately defined such that its membership is capable of determination.” Id. at *5.
The Court, however, recognized that “administrative feasibility has relevance for Rule 23(b)(3) classes, in the light of the manageability criterion of Rule 23(b)(3)(D)” and concluded that a district court “has discretion to insist on details of the plaintiff’s plan for notifying the class and managing the action.” Id. at *5. But it said that because the superiority prong in Rule 23(b)(3) calls for a “balancing test,” comparing class treatment to alternative methods of trying the claims, it does not allow district courts to make administrative feasibility an absolute requirement. Id. at *5.
The decision in Cherry has flipped the Eleventh Circuit stance on whether administrative feasibility is a requirement for ascertainability under Rule 23. As such, potential class representatives will likely have a better chance at being certified under Rule 23 without having to comply with the previously required administrative feasibility element. In defending against class actions, parties will have to argue administrative feasibility as merely a factor for the court’s consideration, rather than an absolute prequisite to class certification.