How broad must a class be in a class action suit? Just broad enough to satisfy the requirements of Rule 23, according to an Alabama federal judge. The district court recently refused an attempt by two debt collectors to compel the expansion of a class in a lawsuit against them over a collection letter privacy notice, holding that the law does not require certification of the broadest possible class of plaintiffs.

In Lewis v. ARS Nat'l Servs. Inc., the plaintiff sued a debt collector that had acquired defaulted debts from JC Penney and the collection agency to which the collector had assigned the debt for collection. The complaint alleged that the collection letters contained a privacy notice that violated the Fair Debt Collection Practices Act (FDCPA). The class as defined was fairly narrow, consisting only of Alabama residents to whom the defendants sent the challenged privacy notice during a one-year period in an attempt to collect a consumer debt originally owed to JC Penney. The defendants argued that the proposed definition was artificially restrictive and would subject the defendants to serial lawsuits based on the same privacy notice mailed to other debtors.

The court found, and there was no dispute. that the class met the Rule 23 certification requirements. The defendants argued, however, that the plaintiffs' class definition was "designed to allow for the maintenance of separate class action complaints based on the exact same alleged conduct." For purposes of the lawsuit, the defendants argued, the identity of both the original creditor and the agency used to collect the debt was immaterial, .because the debt collector sought to collect debts owed to creditors other than JC Penney and sent the same privacy notice at issue here to every debtor, regardless of which collection agency it used. Thus, according to the defendants, any certified class should include all Alabama residents who received the privacy disclosure at issue to avoid multiple suits with the possibility of multiple outcomes and payment of the same statutory damages multiple times.

The court refused to force the plaintiffs to broaden the proposed class. According to the court, the defendants had not proved that they would be subject to serial lawsuits based on the privacy notice at issue, and the court refused to broaden the proposed class based on such "unsupported fear." The court concluded: "The class, as currently defined, fulfills all of the requirements of Rule 23. That is all that the law demands, and this court will not require more based on the mere possibility that it would advance efficiency."

It is interesting that on the one hand, the court said there was "no authority for the proposition that the court should use its discretion to require a broader class," yet on the other, the court appeared to rely in part on the speculative nature of the defendants' argument. This reliance raises the question whether the court might have been willing to expand the class if the defendants had come forward with evidence that additional lawsuits were in the works, and, if so, whether such an expansion would be legally permissible.

While it did not faze the court, the possibility of multiple class actions arising out of the same act is a potential concern for many class action defendants.. Seeking relief through an expanded class definition is one creative way to address this concern, but one that has yet to find traction in the courts.

Contributing author: Diana Lin

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