commonality and typicality "tend to merge." Thus, we move on to consider typicality.
Rule 23(a)(3) requires that "the claims or defenses of the representative parties are typical of the claims or defenses of the class." It is satisfied when "each class member's claim arises from the same course of events, and each class member makes similar legal arguments to prove the defendant's liability." In re Drexel Burnham Lambert Group Inc., 960 F.2d 285, 291 (2d Cir. 1992).
Plaintiffs claim this requirement is satisfied because each class member's claim arises out of the manner in which the home was operated on a day-to-day basis. Plaintiffs cite Johns v. Rozet, 141 F.R.D. 211 (D.D.C. 1992), in support of their position. In Johns, the district court certified a class of composed of the tenants of Tyler House, a low-income housing project, who sought redress from their landlords and their management company for alleged sub-standard and unhabitable conditions. The court held that the typicality requirement was satisfied because the named representatives were residents of Tyler House, when the motion for certification was granted and because their claims arose from the same conditions in common areas and were premised on the same breach of warranty of habitability and negligence theories. Id. at 216.
While the putative class seeking certification in this case has also alleged civil rights and RICO claims, we think that Johns is applicable here. As in Johns, the facts giving rise to the class claims are the same ones which gave rise to Trautz's claims, namely, the condition of the common areas, the adequacy of Manor meals, the timeliness of the distribution of residents' personal needs allowances. etc. While the RICO and the civil rights claims make this case more complex then Johns, the legal issues they raise, such as whether or not the defendants acted under color of state law, whether the defendants engaged in a pattern of racketeering activity, whether the defendants engaged in mail or wire fraud in furtherance of a scheme to defraud the class, whether the Manor constitutes a program which receives federal financial assistance for purposes of § 504 of the Rehabilitation Act, etc., are the same for both Trautz and the class.
Defendants assert that the typicality requirement is not satisfied because of the disparity in injury between each of the class members and the class representative. While the extent of damages may vary between class members (due, at least in part, to the different lengths of time they spent at the facility), plaintiffs claim differences among class members regarding damages are an insufficient basis to defeat class certification. Maywalt v. Parker & Parsley Petroleum Co., 147 F.R.D. 51, 56 (S.D.N.Y. 1993).
Defendants contend that this case is distinguishable from Maywalt, a securities class action, because the damage calculations involved here will be more onerous. Specifically, they contend that the court will be forced to make an individual determination of damages based upon such factors as the length of stay, whether the harm inflicted upon an individual gave rise to a constitutional tort, and the degree of mental anguish suffered. While the damage calculation may prove to be difficult, we do not think it sufficient reason to deny plaintiffs' motion for class certification since we retain the power to modify the class, by dividing it into subclasses or certifying it only as to certain issues or claims. Fed. R. Civ. P. 23(c)(1) and (4).
Finally, Rule 23(a)(4) requires a two-tiered inquiry to establish that the class representatives will fairly and adequately protect the interests of the class. Trief v. Dun & Bradstreet Corp., 144 F.R.D. 193, 201 (S.D.N.Y. 1992). Defendants bear the burden of proving that representation will be inadequate. Welch v. Board of Directors of Wildwood Golf Club, 146 F.R.D. 131, 136 (W.D.Pa. 1993).
The first part of the analysis is whether or not counsel is qualified, experienced and generally able to conduct the litigation. In re Drexel, 960 F.2d at 291. Defendants concede that the attorneys at Disability Advocates Inc. who are handling this case are sufficiently qualified and experienced to represent the class. Therefore, we move on to the second part of the analysis.
The second part of the analysis focuses on whether the class members and the named plaintiff have interests which are not antagonistic to one another. Id. at 291. This requirement also appears to be met. However, defendants assert that Rule 23(a) also requires that the representative plaintiff be familiar with the facts and legal theories contained in the complaint so that the he is not merely "lending [his] name to a suit controlled entirely by the class attorney." Defendants assert that Trautz's deposition testimony "revealed an astonishing lack of familiarity with the basics of this litigation." Specifically, they assert that Trautz was unable to articulate his role as class representatives nor an understanding of the RICO statute.
However, we do not think that an inability on the part of a class representative to explain the civil RICO statute (something which many attorneys cannot do) disqualifies him or her as a class representative. Indeed, in complex actions, plaintiffs are not required to be legal experts and "a great deal of reliance on counsel is to be expected." County of Suffolk v. Long Island Lighting Co., 710 F. Supp. 1407, 1416 (E.D.N.Y. 1989). In the context of such actions, inquiry into the adequacy of the class representatives is rarely appropriate. Id.
C. Certification Under Rule 23(b)
Plaintiffs argue that class certification is proper under Rule 23(b)(1)(A), (b)(1)(B), (b)(2), and (b)(3). Defendants contend that it is not.
1. Rule 23(b)(1)
A class action is maintainable where the prosecution of separate actions by individual class members creates a risk of (1) "inconsistent or varying adjudications with respect to individual members of the class which would establish incompatible standards of conduct for the party opposing the class," F. R. Civ. P. 23(b)(1)(A), or (2) "adjudications with respect to individual members of the class which would as a practical matter be dispositive of the interests of the other members not parties to the adjudications or substantially impair or impede their ability to protect their interests." F. R. Civ. P. 23(b)(1)(B).
Class certification under Rule 23(b)(1)(A) is only proper where a class representative "seeks injunctive relief to alter an on-going course of conduct which is either legal or illegal as to all members of the class." Abramovitz v. Ahern, 96 F.R.D. 208, 215 (D.Conn. 1982). Because we have dismissed the class claim for injunctive relief, certification under (b)(1)(A) would be improper.
While plaintiffs argue that a class action is maintainable for their damage claims under Rule 23(b)(3), they assert, because certain class members may opt-out under (b)(3)'s opt out provisions, a class should be certified as to their punitive damage claims under (b)(1)(B). Plaintiffs argue that such a class is warranted because there is a "limited fund" for punitive damages.
The paradigm Rule 23(b)(1)(B) case is one in which there are multiple claimants to a limited fund . . . and there is a risk that if litigants are allowed to proceed on an individual basis those who sue first will deplete the fund and leave nothing for latecomers.
In re "Agent Orange" Product Liability Litigation, 100 F.R.D. 718, 725 (E.D.N.Y. 1983), quoting A. Miller, An Overview of Federal Class Actions: past, present and Future 45 (1977).
In order to establish a class action based on a "limited fund," plaintiffs must provide more substantiation beyond a large ad damnum clause. In the Agent Orange litigation, Judge Weinstein held that plaintiffs needed to establish a "substantial probability" that upon the award of damages, absent certification, the claims of earlier litigants would exhaust the defendants' assets.
While the need to certify such a class may arise at a future date, at this juncture, plaintiffs have not established a substantial probability that class certification under (b)(1)(B) is proper due to a limited fund. We note that at this point there is no evidence suggesting that class members will opt out or that punitive damages will be awarded. See Langley v. Coughlin, 715 F. Supp. 522 (S.D.N.Y. 1989). In addition, no evidence has been submitted to establish the amount of funds defendants will have at their disposal should plaintiffs prevail. Therefore, we deny plaintiffs motion to certify a punitive damage class pursuant to Rule 23(b)(1)(B) with leave to renew.
2. Rule 23(b)(2)
A class action is also maintainable where "the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole." F. R. Civ. P. 23(b)(2). Again, because we have dismissed the class claim for injunctive relief, (b)(2) is inapplicable.
3. Rule 23(b)(3)
Finally, plaintiffs argue that a class action is maintainable under Rule 23(b)(3). In order to certify a class under 23(b)(3), the court must find (1) that the common questions of law and fact predominate over any questions affecting only individual members and (2) that a class action is far superior to other available methods for fair and efficient adjudication of the controversy. In addition, classes certified under (b)(3) are subject to the notice provisions of Rule 23(c)(2).
Plaintiffs assert that, given the inherent inequality between the class members and defendants, a class action would be the best way to resolve this controversy. In addition, they argue common issues of fact pertaining to defendants' unlawful operation of the Manor predominate. We agree that a class action may be the most fair and efficient way to resolve the individual claims of class members and that common class issues predominate this litigation. To the extent that individual determinations and fact findings become necessary, we reiterate that we retain the power to modify the class and will do so upon the proper showing.
Defendants argue that providing notice to former residents will be extremely difficult and that it is likely that class members will not understand the notice requirement nor their right to opt out. While we agree that tracking down class members may prove to be an onerous task, we do not think that the difficulty alone is sufficient reason to deny class certification. At this juncture, we do not have sufficient information about the individuals who will compose the class (nor do we have any proposed notice form) so as to determine whether or not the class members will understand their options. As such, we cannot address defendants concern that class members, who wish to opt-out may fail to do so, and defendants are free to bring this objection up again when the court considers what will be required in order to provide proper class notification.
In summary, we find that DAI has standing to sue for injunctive relief, but that class representative Trautz does not. Thus, we deny plaintiff's motion for class certification and dismiss the class claims for injunctive relief. However, we grant plaintiff's motion for class certification as to its damage claims, but the damage class shall be limited to individuals who resided at the Manor during the period of November 1, 1989 through June 16, 1990.
GERARD L. GOETTEL
Dated: White Plains, N.Y.
March 16, 1994