Class Action Requirements Explained

If you’ve spent time reading through our blog and newswire here on ClassAction.org, you may have noticed that we refer to each new case as a “proposed” class action.

Get class action lawsuit and settlement news sent to your inbox – sign up for ClassAction.org’s free weekly newsletter here.

Not every proposed class action will become a class action officially, and it may surprise you to learn that there’s a fairly high bar to meet before a case can be certified as a class action—a critical step in the process between a lawsuit’s filing and its potential resolution. In general, failing to meet the certification hurdle can doom a proposed class action for good, but if certification is granted, the plaintiffs’ lawyers are that much closer to a favorable outcome.  

So, what’s the recipe for a successful class action lawsuit? Well, it’s all laid out in what’s known as Rule 23 of the Federal Rules of Civil Procedure. Below, we’ll break down the Rule 23 requirements that every class action must meet in order to pass that formidable certification stage.

But, before we go on, it’s important to note that if you’re considering filing a class action, it’s a good idea to seek the advice of an attorney first. Though we’ll do our best to outline what’s required, an attorney would be better equipped to help explain your legal rights and options and determine whether a class action would be appropriate for your situation.

That being said, let’s get into it.

Ascertainability: Who does the case aim to cover?

Though not expressly mentioned in Rule 23, an implied requirement for class actions is that the proposed class, or the group of people the case is looking to represent, must be clearly defined. This is referred to as ascertainability.

In order for the court to decide that the class is ascertainable, the definition of the proposed class must be clear enough to allow class members to be identified using objective criteria without the need for individualized inquiries—for instance, anyone who purchased a certain product in the U.S. within a specified timeframe. After all, a class action can’t get too far without a clear definition of who it’s looking to cover.

Another factor related to ascertainability is whether it is administratively feasible to identify class members. In other words, even if the class is clearly defined, a court could deny certification if it is too difficult to identify the individual class members.

For example, in Cherry v. Dometic Corp., a lawsuit filed over allegedly defective RV fridges, a judge found that although the class—“all persons who purchased in selected states certain models of Dometic refrigerators that were built since 1997”—was clear, it would be difficult to identify the people who actually owned the fridges. While the DMV’s and the manufacturer’s records could be used to help with the process, those records would also include 1.4 million people who did not own the affected fridges, meaning the records could not be relied on for truly identifying class members, the judge found. After sending out notice, the court would then need to wait for people with the defective fridges to self-identify and send in an affidavit stating they are a class member. The judge found that this multi-step process of identifying class members would prove administratively difficult.

After the plaintiffs appealed the judge’s denial of class certification, however, the appeals court decided that the “administratively feasible” issue could be handled later on and that a “class is ascertainable if it is adequately defined.”

So, while some courts require plaintiffs to prove up front that identifying class members won’t pose an administrative hassle, others have allowed that issue to be addressed later on in the process, which can give those cases a better chance of getting certified as class actions.

Numerosity: How many people are covered?

Rule 23 requires that in order for a lawsuit to be certified as a class action, the class must be “so numerous that joinder of all members is impracticable.”

In other words, the proposed class must include enough people that it would, in practice, be difficult or impossible for each of them to represent themselves in a lawsuit together. In situations like this, it is more appropriate for one or a few people to represent the entire group—which is the whole purpose of a class action lawsuit in the first place.

Some courts have considered the class to be “numerous enough” when it contains at least 40 people, but others have held that factors such as where class members are located, how easily they can be identified, and the size and nature of their claims must also be considered.

Commonality: Were the class members affected by a common problem?

Another Rule 23 prerequisite that a class action must meet is that there exist “questions of law or fact common to the class.”

The commonality prerequisite requires that the class members’ claims are based on common questions—such as, did Company A make a defective product?—and that proceeding on a class-wide basis would generate common answers to those questions.

In other words, those who the case is looking to cover need to have all experienced a similar injury that stemmed from a common cause.

For instance, a recent lawsuit that claimed LendingPoint placed robocalls to consumers’ phones in violation of the Telephone Consumer Protection Act (TCPA) stated that the following questions were common to class members:

The answers to these common questions of law or fact should be able to help resolve class members’ issues on a class-wide basis without extensive individualized inquiries into each person’s situation.

In another example, the makers of a New England Coffee product argued that the plaintiff could not seek relief on a class-wide basis because her case was looking to provide full refunds for consumers who bought the defendants’ hazelnut coffee (which the suit claimed did not contain hazelnut). The defendants argued that because the coffee provided other benefits besides hazelnut flavoring, determining how much of a refund each class member should get for the apparent absence of hazelnut would require individualized inquiries into the benefits each person received from the coffee and thus would not be appropriate for class action treatment.

Typicality: Is the class representative a typical class member?

Each class representative, i.e., the person or people who filed the lawsuit on behalf of the class, must also be able to show that their claims or defenses are “typical of the claims or defenses of the class.”

In other words, the person representing the group covered by the case needs to have experienced generally the same harm as the people they’re looking to represent and not have a unique defense that would become a focus of the case.

In a recent example, a judge declined to certify a proposed class action filed by a “Key & Peele” showrunner over royalties allegedly owed to Comedy Central writers because the plaintiff apparently had access to information that other proposed class members did not. The issue, according to court documents, is that the plaintiff may have been subject to a different statute of limitations than other writers, and therefore would have a different defense that could become a “significant focus” of the litigation. Thus, the typicality requirement was not met, the judge ruled.

Adequacy: Is the class adequately represented?

Rule 23 also requires class representatives and their attorneys to show that they will “fairly and adequately protect the interests of the class.”

The class representative must be part of the class and show that they have no conflicts of interest with the people they’re looking to represent. Conflicts of interest may occur when, for instance, class members seek differing resolutions of the matter at hand or when some class members actually benefit from the alleged conduct at issue.

For example, in a 1997 class action that sought to settle asbestos-related claims, the U.S. Supreme Court found that the interests of all class members were not aligned. The lawsuit was looking to cover both those who were injured from asbestos, whose goal was to receive immediate cash payments, and those who were only exposed to asbestos and had yet to experience a related health issue, whose interest was to make sure there would be enough funds available to cover future injuries. The Supreme Court ultimately affirmed the lower court’s decision to decertify the class, finding that the adequacy requirement had not been met.

A court may also refuse to certify a class if a class action is not in the best interests of class members, such as when there is another available remedy already (like a refund) and the cost of sending out notice to those affected and paying attorneys’ fees would take away from what the individuals could otherwise recover.

Finally, courts may also consider whether the plaintiff’s attorneys are qualified, experienced and able to handle the litigation.

Additional requirements for different types of lawsuits

Aside from the above requirements that apply to all class actions, Rule 23 also stipulates that each proposed class action must fall into one of the following categories (and meet any additional requirements for that category) to be certified:

The lawsuit is seeking individualized damages.

This is the category that applies to most proposed class actions. If the lawsuit is seeking individualized damages for those it aims to cover, two additional requirements must be met:

The lawsuit is seeking only injunctive or declaratory relief.

Another type of class action is one that is looking to get the court to order the defendant to stop or take a certain action (called injunctive relief) or declare the class members’ rights with respect to the matter at hand (called declaratory relief). Cases that fall into this category are not seeking individualized damages for those who they’re looking to cover. To succeed with this type of case, the defendant must have engaged in some action or inaction that generally affected all class members, such that injunctive or declaratory relief would provide a class-wide solution.

The lawsuit aims to address a situation that could be problematic if handled on an individual basis.

A lawsuit can proceed as a class action if it meets all the initial requirements and there’s a risk that inconsistent or differing rulings in separate lawsuits would generate “incompatible standards of conduct” for the defendant. In cases like this, a class action would avoid a situation where judges come to different rulings with respect to how the defendant should act toward the people covered by the suit. An example of a case that falls into this category is one where the defendant is a taxing authority or another entity that is legally bound to treat all class members the same.

A lawsuit also falls under this category if a decision in an individual’s case would endanger the interests of other would-be class members, such as when the defendant has limited funds available to pay for damages.

So how do I know if my case fits all these requirements?

Because Rule 23 requirements can get pretty complex, it’s best to seek the advice of an attorney if you’re thinking about filing a class action.

An attorney should be able to help you navigate these requirements and explain your legal rights and options specific to your situation. When looking for an attorney, recommendations from friends and family are often the best way to go, but you can also check to see if your state bar organization provides referral services. There are also some online attorney directories you can check, including Avvo, LegalZoom and Martindale.

That being said, whether a proposed class action is certified is ultimately up to the judge to decide. 

Don’t miss out on class action lawsuit and settlement news. Sign up for ClassAction.org’s free weekly newsletter here.