Michael R. Lied

Related Attorney

Michael R. Lied

Meet This Attorney

Get In Touch

Have a case? Use our quick contact form to speak to an attorney today.

Proposed Class Action Not Mooted By Defendant's Tender (Monday, November 9, 2015)

Ballard RN Center, Inc. filed a three-count class action complaint alleging that on March 3, 2010, Kohll’s Pharmacy & Homecare, Inc., sent plaintiff an unsolicited fax advertisement. The complaint alleged that defendant’s conduct: (1) violated the Telephone Consumer Protection Act of 1991 (Protection Act) (47 U.S.C. § 227; (2) violated the Consumer Fraud and Deceptive Business Practices Act (Fraud Act) (815 ILCS 505/2; and (3) constituted common-law conversion of plaintiff’s ink or toner and paper. Each of the three counts included class allegations.

The complaint alleged that plaintiff did not have a prior business relationship with defendant and plaintiff did not authorize defendant to send fax advertisements to plaintiff. The complaint further alleged that defendant’s fax advertisement did not provide the requisite “opt out notice.”
 
Concurrent with its complaint, plaintiff also filed a motion for class certification pursuant to section 2-801 of the Illinois Code of Civil Procedure.  735 ILCS 5/2-801 et seq
 
On June 28, 2012, defendant filed a motion seeking summary judgment solely on count I of plaintiff’s complaint that sought recovery under the Protection Act. In its motion, defendant alleged that on three separate occasions defendant tendered plaintiff an unconditional offer of payment exceeding the total recoverable Protection Act damages. Plaintiff rejected all three tenders. Defendant further alleged that plaintiff did not file a motion for class certification despite the case being open for over two years.
 
The circuit court denied defendant’s motion for summary judgment. The court reasoned that defendant did not make its tender on count I before plaintiff filed its motion for class certification.  Therefore, the claim was not moot under Barber v. American Airlines, 241 Ill.2d 450 (2011). Barber held that a class action may be dismissed as moot when the defendant tenders relief to the named plaintiff prior to the filing of a motion for class certification.
 
Disagreeing with defendant’s argument that plaintiff’s motion for class certification was merely a “shell” motion, the circuit court concluded that “Barber requires only that a motion for class certification be filed. It does not require that it meet any certain standard.” 
 
On April 15, 2013, the circuit court granted plaintiffs amended motion for class certification. On interlocutory appeal, the appellate court affirmed the circuit court’s order certifying the class on counts II and III but reversed the court’s class certification on count I.  The appellate court agreed with defendant’s contention that plaintiff’s initial motion for class certification, filed concurrently with its class action complaint, was a “shell” motion that was insufficient under Barber.
 
On appeal to the Illinois Supreme Court, plaintiff argued that the appellate court erroneously construed Barber to require the motion for class certification filed with its class action complaint to contain sufficient factual allegations and evidentiary materials adduced through discovery to avoid mootness when a defendant tenders relief to the named class representative. Plaintiff urged the court to reject that interpretation and, instead, adopt the procedure employed by the federal courts.  Plaintiff maintained that while federal courts in Illinois also require the filing of a class certification motion with the complaint, they expressly recognized that information about the size of the class and nature of defendant’s practices will have to be obtained during discovery and supplied later.
 
In Barber, the court focused on mootness principles applicable to class actions. Barber, at 456 (citing Wheatley v. Board of Education of Township High School District 205, 99 Ill. 2d 481 (1984)). Specifically, the court explained that:
 
“[T]he important consideration in determining whether a named representative’s claim is moot is whether that representative filed a motion for class certification prior to the time when the defendant made its tender. [citations omitted.] Where the named representative has done so, and the motion is thus pending at the time the tender is made, the case is not moot, and the circuit court should hear and decide the motion for class certification before deciding whether the case is mooted by the tender. [Citation omitted.] The reason is that a motion for class certification, while pending, sufficiently brings the interests of the other class members before the court ‘so that the apparent conflict between their interests and those of the defendant will avoid a mootness artificially created by the defendant by making the named plaintiff whole.’" Barber, at 456-57.    
 
The court further explained in Barber, however, that the situation is different when the tender is made before the filing of a motion for class certification. In that situation, the interests of the other class members are not before the court, and the case may properly be dismissed. Barber, 241 111. 2d at 457. Thus, dismissal of the plaintiff’s class action was proper in Barber because there was no motion for class certification pending when the defendant refunded the contested $40 baggage fee to the plaintiff, thereby mooting her claim. Barber, at 457.
 
The court in Barber rejected the so-called “pick off’ exception that had developed in the Illinois appellate court. The “pick off’ exception lacked a valid legal basis and also contradicted applicable mootness principles when the named plaintiff in a class action is granted the requested relief. Barber, at 460.
 
Barber contained no explicit requirement for the class certification motion, other than the timing of its filing. In other words, Barber does not impose any sort of threshold evidentiary or factual basis for the class certification motion.
 
Plaintiff’s motion for class certification was not a “shell” motion that lacked content. To the contrary, plaintiff’s motion for class certification identified defendant, the applicable dates, and the general outline of plaintiff’s class action allegations. More specifically, plaintiffs motion sought certification of three separate classes of individuals with fax numbers who received fax advertisements from defendant during a specific time period and were not provided the requisite “opt out” notice. The motion also referenced the description of the classes in plaintiff’s concurrently-filed class action complaint, a pleading that provided additional factual allegations. Thus, plaintiff’s motion was not a frivolous “shell” motion when it contained a general outline of plaintiff’s class membership, class action allegations, and effectively communicated the fundamental nature of the putative class action.
 
Even assuming that plaintiff’s motion for class certification was insufficient for purposes of class certification under section 2-801 of the Code.   Barber did not hold that the motion for class certification must be meritorious. To the contrary, the focus of Barber was on the timing of the filing of a motion for class certification—there was no mention of the ultimate merits of that motion.
Focusing on the timing of the filing of the motion for class certification rather than on its ultimate merit is also consistent with the approach taken in the Seventh Circuit Court of Appeals.
 
The Seventh Circuit has also thoroughly addressed the competing interests of the defendant and the named plaintiff on the issue of a tender mooting the class action. Rejecting the class action defendant’s concern that a plaintiff may have an incentive to move for class certification prematurely without the fully developed facts or discovery required to obtain certification, the court explained that:
 
“If the parties have yet to fully develop the facts needed for certification, then they can also ask the district court to delay its ruling to provide time for additional discovery or investigation. In a variety of other contexts, we have allowed plaintiffs to request stays after filing suit in order to allow them to complete essential activities. [Citations omitted.] *** We remind district courts that they must engage in a ‘rigorous analysis’—sometimes probing behind the pleadings—before ruling on certification. [Citation omitted.] Although discovery may in some cases be unnecessary to resolve class issues [citation omitted], in other cases a court may abuse its discretion by not allowing for appropriate discovery before deciding whether to certify a class.  
 
This approach was entirely consistent with Barber and correctly afforded the trial court discretion to manage the development of the putative class action on a case-by-case basis.
 
Barber did not impose any explicit requirements on the motion for class certification, and plaintiff’s motion for class certification in this case was sufficient for purposes of Barber. In cases when additional discovery or further development of the factual basis is necessary, those matters will be left to the discretion of the trial court.
 
The important consideration in determining whether a named representative’s claim is moot is whether that representative filed a motion for class certification prior to the time when the defendant made its tender. Defendant’s tender of relief, partial or otherwise, after plaintiff filed its class certification motion could not render moot any part of plaintiffs pending action under Barber.  The appellate court erred in reaching the opposite conclusion, and the court reversed that part of its decision.
 
Ballard RN Center, Inc. v. Kohll’s Pharmacy and Homecare, Inc., 2015 IL 118644.   

 


 

· Michael R. Lied
· Howard & Howard Attorneys PLLC
· One Technology Plaza, 211 Fulton Street, Suite 600, Peoria, IL 61602
· (309) 999-6311
· MLied@howardandhoward.com  

Back