It has been a few weeks since we first posted about class actions and COVID-19. In that initial article, we analyzed the first coronavirus related lawsuit but were forced to prognosticate as to what an actual COVID-19 class action would look like as none had yet been filed, and how putative classes would attempt to clear the various hurdles of Rule 23 certification. We no longer have to speculate. Now, several weeks into this pandemic, numerous COVID-19 related class actions have been filed throughout the country in various different spaces—consumer, mass tort, securities, labor & employment, and banking and privacy. These newly filed complaints (and some corresponding opinions) provide us valuable insight into how class action plaintiffs will proceed with outbreak-related claims, and allows us the opportunity to further analyze the viability of putative class action complaints. This post will address the first COVID-19 certification decision and include an analysis of the two most active areas of COVID-19 class actions: mass torts and consumer protection. In follow-up posts, we will discuss and analyze securities, labor & employment, banking, and privacy class actions arising from some aspect of this pandemic.
First Certification Decision:
While the majority of these cases will take weeks or months (particularly given the court shutdowns that have occurred throughout the country) to progress to the class certification stage, surprisingly we have already seen the first COVID-19 class certified. On April 8, 2020, a district court in the District of Massachusetts certified a class of civil immigration detainees who sought to assert a violation of due process as a result of confinement in conditions “that include the imminent risk of contracting COVID-19.” See Maria Alejandra et al v. Steven J. Souza, No. CV 20-10617-WGY, 2020 WL 1703844 (D. Mass. Apr. 8, 2020). After analyzing and determining that all Rule 23(a) prerequisites were satisfied, the court paused to examine whether the class could be certified as an “injunction” class pursuant to Rule 23(b)(2), and more specifically whether a uniform injunction or declaratory judgment would satisfactorily address the needs of all class members. Id. at 8. Ultimately, Massachusetts District Judge William G. Young held that “a uniform remedy would be possible in this case, whether in the form of declaratory relief or an injunction ordering the government to reduce crowding of Detainees.” Id.
While the Alejandra certification is noteworthy, its significance will likely be limited to similar habeas petitions where the putative class members seek injunctive relief to ensure proper COVID-19 precautionary procedures are implemented at their holding facility.[1] Unlike Alejandra, the vast majority of COVID-19 class actions filed within the last week seek monetary damages, and unlike a class seeking injunctive relief, they face the difficult task of demonstrating that common questions of law and fact will predominate over those affecting the individual members.
Mass Tort Class Actions:
Several mass tort class actions have been filed alleging personal injuries related to COVID-19 while on a cruise ship. See Archer, et al. v. Carnival Corp., et al., 3:20-cv-02381 (N.D. Cal.) (Plaintiffs allege that Defendants “knew of the unreasonably high risk of viral contagion of COVID-19 on cruise ships” and “Defendants failed to do what a reasonably careful cruise ship owner and operator would do under the circumstances.”); see also Turner v. Costa Crociere S.P.A., 1:20-cv-21481 (S.D. Fla.).
As we outlined in our initial post, class action plaintiffs who allege personal injuries arising from COVID-19 will likely struggle to meet the rigors of Rule 23, specifically because resolution of certain questions will require extensive amounts of individualized evidence particular to each class member, which would ultimately necessitate countless “mini-trials” to resolve. Plaintiffs acknowledge this hurdle in the Archer class action complaint by strategically asking the court to treat the matter as a mass action if it is determined that a class action was not appropriate.
Consumer Class Actions:
Given COVID-19’s significant impact on the economy, it is no surprise to see a myriad of class actions brought by consumers, particularly those seeking refunds due to cancellations or closures caused by the virus. For example, in Jampol v. Blink Holdings, 1:20-cv-02760 (S.D. N.Y.), plaintiffs allege that Blink Fitness is deliberately bilking its customers out of their monthly dues even though members do not have access to the fitness center during the pandemic. Similar refund-type class actions have been filed all over the country. In McMillan v. Stubhub, Inc., et al. 3:20-cv-00319 (W.D. Wis.), aggrieved consumers allege they were deprived of the benefit of Stubhub’s longstanding money back guarantee program when the ticket-exchange company sought to retroactively discontinue the program in an attempt to avoid massive amounts of refunds caused by the COVID-19 cancellations. Also, in Utley v. United Airlines Holdings, Inc., et al., 1:20-cv-00756 (N.D. Ohio), putative class members are demanding United Airlines provide full and immediate refunds for the unused portion(s) of their respective flight tickets.
Results have been mixed in past “cancellation” and “refund” putative class actions. Some courts have certified classes, while others have found that common issues of the class did not predominate over individualized issues, thereby precluding class certification. See e.g., Mullaney v. Delta Air Lines, Inc., 258 F.R.D. 274 (S.D.N.Y. 2009); Friedman v. 24 Hour Fitness USA, Inc., No. CV 06-6282 AHM (CTX), 2009 WL 2711956, at *1 (C.D. Cal. Aug. 25, 2009). In Mullaney, airline passengers affected by an airline cabin crew strike brought suit for damages caused by the alteration in their travel plans. Id. In denying class certification, the court observed that the case would hinge on individualized representations made to each class member, and each class member would be required to explain what they did with their ticket “in order for the trier of fact to determine their eligibility for a refund which could not be generalized.” Id. at 279. In comparison, the Friedman court found class certification appropriate upon finding that the fitness club “imposed post-cancellation charges in a uniform manner, relying on its construction of the termination and without regard to what members may have understood.” Friedman, 2009 WL 2711956, at *7. As these cases illuminate, class certification of the COVID-19 consumer “refund” class actions will likely hinge on whether the cancellation policies were uniformly applied, whether messaging was common and consistent, and whether it is possible for a court to determine the eligibility of a refund in a generalized manner without the need for individualized inquiries.
In addition to the refund class actions, there have been numerous class actions relating to the labeling of products, specifically products that claim they can prevent or cure the COVID-19 infection. In David, et al. v. Vi-Jon, Inc. d/b/a Germ-X, 3:20-cv-9999 (S.D. Cal.), plaintiffs allege that the defendants “marketed and sold . . . a Product that will prevent or reduce infection from the flu and other viruses, including the coronavirus” when “[t]here are no reliable studies that support such representations.” In Miller et al. v. GOJO INDUSTRIES, INC., d/b/a Purell, 2020 WL 1599806 (N.D.Ohio), plaintiffs assert that the defendant had falsely advertised the capabilities of Purell hand sanitizer without sound scientific support.
Just as with typical consumer class actions where plaintiff consumers seek damages for purchases of products they allege were falsely advertised or mislabeled in some way, the David and Miller plaintiffs’ restitution will likely be calculated by the “price premium” method. A “price premium” is the difference between the market price actually paid by consumers and the true market price that reflects the impact of the unlawful, unfair, or fraudulent business practices. In David and Miller, the plaintiffs would need to reliably calculate the precise amount they would have paid for the hand sanitizer had they not been subjected to the alleged fraudulent statements. Plaintiffs likewise will have to prove the underlying alleged “defect” or falsity associated with their claim – that the involved products do not kill the coronavirus (or at least all coronavirus in existence at the time of the labeling). Both issues will be subject to “rigorous analysis” prior to certification and will form the bulk of the battle. See Comcast Corp. v. Behrend, 569 U.S. 27, 34 (2013).
We suspect these class actions are just the tip of the iceberg of class claims that will arise out of this pandemic. Stay tuned for our subsequent posts exploring newly filed class actions in other industries and fields.
[1] It should be noted, certification for a similar prisoner COVID-19 class action in the Northern District of Illinois was denied. See James Money, et al. v. J.B. Pritzker, et al., No. 20-CV-2093, 2020 WL 1820660, at *1 (N.D. Ill. Apr. 10, 2020). Unlike the immigration detainees in Alejandra, the class plaintiffs in Money did not seek for improvements to their confinement conditions—i.e., cleanliness of the prisons, increase the amount of space between inmates at each facility, etc.—instead, plaintiffs asked for the release of thousands of inmates, to include violent offenders.
