The Third Circuit recently vacated an order denying class certification, and in the process provided more clarity on what plaintiffs must do to satisfy Rule 23’s predominance and ascertainability requirements.
In Kelly v. RealPage Inc., — F.4th —, 2022 WL 3642113 (3d Cir. Aug. 24, 2022), the plaintiffs alleged that their rental applications were denied based on inaccurate consumer reports generated by RealPage, and that RealPage would not correct the reports unless plaintiffs obtained proof of the error from RealPage’s sources. The identities of the sources were not included in RealPage’s disclosures to plaintiffs. Plaintiffs claimed that this conduct violated the Fair Credit Reporting Act, which requires a consumer reporting agency to disclose to a consumer, upon request, “[a]ll information in the consumer’s file at the time of the request” and “[t]he sources of [that] information.” 15 U.S.C. § 1681g(a)(1), (a)(2). The district court denied plaintiffs’ class certification motion because Rule 23’s predominance and ascertainability requirements were not met, but the Third Circuit held that the district court was wrong to do so.
The Third Circuit conclusion that plaintiffs had failed to establish predominance turned on an interpretation of the FCRA. The district court had misinterpreted Section 1681g(a) to require a consumer to specifically request his or her “file” rather than just a “report.” Because a generalized request by a consumer for information is sufficient to trigger Section 1681g(a), the Third Circuit held that the district court erred in finding that individualized proof would be needed to distinguish between requests for “reports” from those for “files.”
The Third Circuit also held that the district court misapplied the ascertainability requirement. “[A]scertainability does not mean that ‘no level of inquiry as to the identity of class members can ever be undertaken[.]’” Kelly, 2022 WL 3642113, at *16 (quoting Byrd v. Aaron’s Inc., 784 F.3d 154, 171 (3d Cir. 2015)). The court rejected the argument that identifying class members would be administratively infeasible where RealPage’s records on requests were kept in a separate database from reports sent out in response to those requests, and no unique identifier was used across both systems. The court noted that a “straightforward ‘yes-or-no’ review of existing records to identify class members is administratively feasible even if it requires review of individual records with cross-referencing of voluminous data from multiple sources.” Id. at *17. The Third Circuit has historically been more restrictive on the issue of ascertainability than some other circuits, and this decision might suggest further softening of that view. It remains to be seen whether this decision signals a further departure from the Third Circuit’s restrictive stance on ascertainability or is instead properly viewed as limited to its facts – a situation in which identifying class members, although challenging, would nonetheless be feasible without imposing excessive effort.