Finding No Concrete Harm, Judge Decertifies Public Storage Class Action
It's another ripple from the New Jersey Supreme Court's 2018 ruling in "Spade v. Select Comfort," which held that TCCWNA claims require a showing of actual harm. "The entire basis and premise of this case has essentially disappeared," Judge Jerome Simandle said.
March 29, 2019 at 03:57 PM
4 minute read
Citing a lack of concrete injuries, a Camden federal judge has decertified a class action brought under the Truth in Consumer Contract, Warranty and Notice Act on behalf of individuals who had entered into leases with Public Storage.
In granting the defendant's motions to decertify the class, U.S. District Judge Jerome Simandle cited the New Jersey Supreme Court's 2018 ruling in Spade v. Select Comfort, which required a showing of adverse consequences as a result of the defendant's regulatory violation in order to find a consumer aggrieved under TCCWNA.
Simandle granted a defense motion for summary judgment without prejudice, “because the entire basis and premise of this case has essentially disappeared,” he said.
Class certification was granted in November 2015 over contract language imposed by Public Storage, including a clause requiring customers to indemnify the company for losses arising out of the use of the facility by customers or their invitees. Of the roughly 160,000 class members in the case, the parties identified 29 individuals who might be able to claim they suffered harm from the application of Public Storage's contract language, according to the decision.
Plaintiff counsel had sought statutory damages of $100 each for the 160,000 class members, putting the potential exposure from the case at $16 million.
But as a result of the Spade decision, at least three—predominance, typicality and numerosity—of the seven Rule 23 requirements for class certification are no longer satisfied, Simandle said.
The typicality rule is no longer met because the sole named plaintiff, Jackeline Martinez-Santiago, as one of the few renters who suffered adverse consequences from the Public Storage lease terms, is no longer typical of the class. Martinez-Santiago's boyfriend, Orlando Colon, was injured on icy pavement while visiting the storage unit, and was barred from seeking compensation for his injury under Public Storage's strict contract language.
The predominance requirement is no longer met because Spade requires that a TCCWNA plaintiff claiming to be an aggrieved consumer show he or she had an actual dispute with Public Storage based on an allegedly unlawful contract provision. Accordingly, Simandle wrote, the questions of fact common to class members no longer predominate over questions affecting only individual members.
And the numerosity requirement is no longer met because only 29 individuals might be able to state a viable TCCWNA claim against Public Storage, Simandle said. While there is no minimum number of plaintiffs required to maintain a class action, the Third Circuit has generally held that if the potential number of plaintiffs exceeds 40, the numerosity prong has been met, he said.
The judge called for lawyers on both sides to file a joint proposal within 14 days to state their plans for the remaining claims in the case, if any.
In April 2018, the state Supreme Court ruled in Spade and a companion case, Wenger v. Bob's Discount Furniture, that actual harm is needed to make out claims under TCCWNA. The Supreme Court issued that ruling after the U.S. Court of Appeals for the Third Circuit asked it to clarify unresolved areas of New Jersey law.
Michael Galpern of Javerbaum Wurgaft Hicks Kahn Wikstrom & Sinins in Mount Laurel, who represents Martinez-Santiago, said he was evaluating his options on how to proceed with the case. He said he disagrees with the Supreme Court decision in Spade and Wenger, but added that he still considers TCCWNA viable for plaintiffs.
Ballard Spahr represented Public Storage. William Reiley of that firm declined to comment and referred questions to Casey Watkins, who did not return a call.
Enacted in 1981, TCCWNA provides damages to an aggrieved consumer who demonstrates that a contract contains provisions violating any clearly established legal right.
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