In a series of decisions beginning in 2012, the Third Circuit has held that a plaintiff seeking class treatment under Rule 23(b)(3) must demonstrate that the class is “currently and readily ascertainable based on objective criteria.” In practice, this means that a class cannot be certified if class members (a) are impossible to identify without extensive and individualized fact-finding or mini-trials, or (b) cannot be identified via a reliable and administratively feasible method, one that permits a defendant to test the reliability of the evidence submitted to prove class membership. The court has held that defendants possess the right to challenge such evidence as a matter of due process.
Applying this “ascertainability” requirement in consumer protection cases, the court has rejected class treatment where class membership is predicated solely upon potentially self-serving affidavits from putative class members attesting that they purchased the defendant’s products. The court has also rejected the use of customer membership cards or online sales records absent evidence that they are a reliable method for establishing class member purchases.
Noting “apparent confusion” over what it described as “a relatively simple requirement,” in 2015 the Third Circuit sought to clarify and outline the “precise boundaries” of its previous rulings on ascertainability. First, ascertainability does not mean that a plaintiff must be able to identify each and every class member when they move for certification. Instead, a plaintiff need only show that class members can be identified when necessary. Second, class member affidavits attesting to purchases can, when allied with other evidence such as retailer records, be used to prove class membership, so long as the process is reliable. Third, the fact that a class definition is “underinclusive” (i.e., does not include all persons allegedly harmed by the defendant’s actions) is not a per se bar to ascertainability (although it may be relevant in determining whether the evidence presented to establish class membership is sufficient). Nor is the fact that the class definition may be “overbroad” (i.e., includes persons not injured by the defendant). Finally, the need to review individual records or files to identify class members is not, by itself, reason to deny certification. If it were, the court explained, no class could ever be certified under Rule 23(b)(3).
The recent decision in City-Select Auto Sales Inc. v. BMW Bank of N. Am. Inc. provides further guidance on what evidence will and will not be considered sufficient to meet the ascertainability requirement.
In City-Select, a New Jersey automobile dealership brought a putative class action against the consumer financing division of BMW and its contractor, based on junk faxes allegedly sent in violation of the Telephone Consumer Protection Act.
To send each fax, the contractor’s employees had generated a list of recipients from the contractor’s customer database. After generating the recipient list (a subset of the names in the customer database), the employee uploaded the list and a fax advertisement for BMW was then broadcast to each recipient. However, the contractor did not maintain a list of the dealerships to which the BMW faxes were sent.
The plaintiff City-Select sought to represent a putative class of dealerships listed in the contractor’s customer database that received unsolicited BMW faxes. During class certification discovery, it sought to compel production of the contractor’s database. This motion was denied.
The district court subsequently denied the plaintiff’s class certification motion on ascertainability grounds, finding that there was no reliable and administratively feasible means of determining whether putative class members fell within the class definition. The district court concluded that “even though Plaintiff may be able to identify the potential universe of fax recipients [via the database], there [was] no objective way of determining which customers were actually sent the BMW fax.”
City Select appealed. In August of 2017, the Third Circuit vacated the district court ruling and remanded the case for further fact-finding.
The court began its opinion by summarizing the pre-existing law on ascertainability in the Third Circuit.
A Rule 23(b)(3) class must … be currently and readily ascertainable based on objective criteria. To satisfy this standard, plaintiff must show that (1) the class is defined with reference to objective criteria; and (2) there is a reliable and administratively feasible mechanism for determining whether putative class members fall within the class definition. Plaintiff has the burden of making this showing by a preponderance of the evidence, and the district court must undertake a rigorous analysis of the evidence to determine if the standard is met. However, plaintiff need not be able to identify all class members at class certification – instead, a plaintiff need only show that class members can be identified.
It then restated the “three principal rationales” for the ascertainability requirement:
- “Ascertainability and a clear class definition allow potential class members to identify themselves for purposes of opting out of a class.”
- “It ensures that a defendant’s rights are protected by the class action mechanism” and that “those persons who will be bound by the final judgment are clearly identifiable.
- “It ensures that the parties can identify class members in a manner consistent with the efficiencies of a class action.”
Turning to the district court’s decision, the Third Circuit explained that “[its] ascertainability precedents do not categorically preclude affidavits from potential class members, in combination with the [contractor’s] database, from satisfying the ascertainability standard.”
First, the court distinguished its previous decisions on the ground that, unlike the consumer classes in those cases, where the plaintiffs had not tied the class definitions to the available records, the contractor database in this case allowed for notice directly to potential class members. It also limited the universe of potential claimants to those identified in the database. Any fax recipients that were not included in the database would not be bound by any judgment. Thus the first two principal policy rationales for the ascertainability standard – facilitating opt-outs and identifying persons bound by the final judgment – were not implicated.
Second, with respect to the district court’s finding that the contractor database was over-inclusive because there was no evidence that the BMW fax was sent to every customer who had a fax number in the database, the Third Circuit held that class member affidavits could help the plaintiffs overcome that problem.
Plaintiff need not, at the class certification stage, demonstrate that a single record, or set of records, conclusively establishes class membership. Rule 23 does not require an objective way of determining class membership at the certification stage, but only that there be “objective criteria” for class membership and a “reliable and administratively feasible” means of determining whether these criteria are met. Affidavits from potential class members, standing alone, without “records to identify class members or a method to weed out unreliable affidavits,” will not constitute a reliable and administratively feasible means of determining class membership. However … our other cases do not imply “no level of inquiry as to the identity of class members can ever be undertaken.” Affidavits, in combination with records or other reliable and administratively feasible means, can meet the ascertainability standard.
In this case, the contractor’s database defined a limited set of potential claimants. The only factual inquiry required to determine class membership was whether a particular dealership in the database received the BMW fax on one of the dates in question. Answering this factual question through affidavits or other available records would not necessarily require individualized fact-finding that would be “administratively infeasible.” In a footnote that may well become a major focus of future debate, the court stated that:
Even if it is true that the BMW fax was not sent to every customer who had a fax number in the database during the relevant time period, the class could still be certified, so long as there is a method for determining which customers did receive such faxes, which could be by affidavit.
The amount of overinclusiveness, if any, of the proposed records is a critical consideration. “While a high degree of over-inclusiveness could prevent certification, any degree of over-inclusiveness will not do so.”
Because the database was not produced during discovery, the plaintiff was denied the opportunity to demonstrate the role that it could play in providing a reliable, administratively feasible method of ascertaining class membership. The Third Circuit therefore vacated the denial of class certification and remanded with instructions that the database be produced.
The decision reaffirms the boundaries on the ascertainability doctrine that the court first sought to establish in 2015.
The mere fact that class definitions may be overinclusive or underinclusive does not provide a basis for an ascertainability objection, although it may affect the sufficiency of the evidence proposed as a basis for determining class membership.
The decision reaffirms the court’s previous holdings that affidavits, standing alone, cannot provide a sufficient basis for determining class membership.
It holds that affidavits, in combination with some other reliable source, may provide a sufficient basis upon which to find ascertainability.
While the decision seeks to provide further clarity in this area, it remains unclear just how significant a role affidavits can play in meeting the ascertainability test. If the court is suggesting that affidavits can be used only to corroborate information contained in what the court considers a reliable source for identifying class members (e.g., a customer list or database), then the question arises as to what purpose the affidavits really serve. Alternatively, if affidavits are used for a more substantive purpose, for example, to weed out members of an overinclusive class, then their role is not merely one of corroboration but as the primary source of proof itself. In such circumstances, it is the affidavit that determines whether or not a person qualifies as a class member. And in that situation, two questions arise: (1) is this consistent with the principle that affidavits, by themselves, cannot be used to establish class membership, and (2) does using affidavits in this role run afoul of defendants’ due process rights?
The City-Select opinion was authored by Judge Scirica. Judge Fuentes wrote a concurring opinion in which he advocated for the abandonment of the ascertainability rule. Judge Fuentes is not alone in his opinion that the Third Circuit’s ascertainability jurisprudence should be abandoned. Several of his brethren have authored or joined dissenting or concurring opinions espousing the same view.
Federal Courts of Appeals in other Circuits are likewise divided on the Third Circuit approach. In the last year, the Second and Ninth Circuits have joined the Sixth, Seventh and Eighth Circuits in rejecting what they view as a heightened standard for ascertainability that is incompatible with Rule 23. The Fourth Circuit and the Eleventh Circuit (albeit in an unpublished opinion) stand with the Third Circuit in imposing an ascertainability requirement.
US SUPREME COURT
With a clear and well-developed Circuit split on such a threshold issue, one would expect the U.S. Supreme Court to step in and resolve the conflict. However, the Court has shown no such appetite to date. In the past two years, it has denied three certiorari petitions in which the issue was presented. A fourth petition is currently pending before the Supreme Court, but is stayed pending a possible settlement.
NJ STATE COURTS
In the state courts, the governing precedent remains the decision of the Appellate Division in Daniels v. Hollister, which held that the ascertainability requirement has no place in consumer cases, and expressed “misgivings” about its use in any other class action as well. There were no new developments in the state law context over the past year.
 In Shelton v. Bledsoe, 775 F.3d 554 (3d Cir. 2015), the court held that the ascertainability requirement does not apply in putative class actions brought under Rule 23(b)(2). Id. at 561.
 See, e.g., Marcus v. BMW of N. Am. LLC, 687 F.3d 583, 593 (3d Cir. 2012);
Hayes v. Wal-Mart Stores, Inc., 725 F.3d 349, 354-56 (3d Cir. 2013).
 Id. at 593-94. “Administrative feasibility” means that “identifying class members is a manageable process that does not require much, if any, individual factual inquiry.” Carrera v. Bayer Corp., 727 F.3d 300, 307-08 (3d Cir. 2013).
 See, e.g., Marcus, 687 F.3d at 594 (“Forcing BMW and Bridgestone to accept as true absent persons’ declarations that they are members of the class, without further indicia of reliability, would have serious due process implications”); Carrera, 727 F.3d at 307 (“A defendant has a … due process right to challenge the proof used to demonstrate class membership …”).
 See, e.g., Carrera, 727 F.3d at 308-10.
 Byrd v. Aaron’s Inc., 784 F.3d 154, 161 (3d Cir. 2015).
 Id. at 162.
 Id. at 164.
 Id. at 166-68.
 Id. at 171. The Byrd court did not address the Third Circuit’s previous holding that “administrative feasibility” means that “identifying class members is a manageable process that does not require much, if any, individual factual inquiry.” Carrera, 727 F.3d at 307-08.
 City Select Auto Sales Inc. v. BMW Bank of N. Am. Inc., 867 F.3d 434, 436 (3d Cir. 2017).
 Id. at 437.
 Id. at 438.
 Id. at 439.
 Id. at 440.
 Id. at 441.
 Id. at 443 n.4.
 Id. at 443.
 Id. at 443 n.4.
 Id. at 443.
 See, e.g., Carrera v. Bayer Corp., 2014 WL 3887938, at *1 (3d Cir. May 2, 2014) (Ambro, J., dissenting from denial of rehearing en banc); Byrd, 784 F.3d at 72 (Rendell, J., concurring).
 See In re Petrobras Sec., 862 F.3d 250, 265 (2d Cir. 2017) (“we decline to adopt a heightened ascertainability theory … [which] would upset the careful balance of competing interests codified in the explicit requirements of Rule 23”); Briseno v. ConAgra Foods, Inc., 844 F.3d 1121, 1125 (9th Cir. 2017) (“A separate administrative feasibility prerequisite to class certification is not compatible with the language of Rule 23”); see also Rikos v. Procter & Gamble Co., 799 F.3d 497, 525 (6th Cir. 2015); Mullins v. Direct Digital, LLC, 795 F.3d 654, 658 (7th Cir. 2015).
 EQT Prod. Co. v. Adair, 764 F.3d 347, 358 (4th Cir. 2014); Karhu v. Vital Pharm., Inc., 621 F. App’x 945, 948 (11th Cir. 2015).
 ConAgra Brands, Inc. v. Briseno, 138 S. Ct. 313 (2017); Procter & Gamble Co. v. Rikos, 136 S. Ct. 1493 (2016); Direct Digital, LLC v. Mullins, 136 S. Ct. 1161 (2016).
 Petroleo Brasileiro S.A. v. Univ. Superannuation Scheme Ltd., No. 17-664 (U.S., petition for cert. filed Nov. 1, 2017, stayed Jan. 16, 2018).
 440 N.J. Super. 359 (App. Div. 2014).
 Id. at 368-69.