United States District Court, S.D. New York
GEOFFREY OSBERG, on behalf of himself and on behalf of all others similarly situated, Plaintiff,
FOOT LOCKER, INC. et al., Defendants.
OPINION & ORDER
KATHERINE B. FORREST, District Judge.
On September 24, 2014, this Court certified a class in the above captioned ERISA action. (ECF No. 186.) After further briefing, including submission of materials to the Second Circuit in connection with a petition for review under Rule 23(f), this Court notified the parties that it would reconsider its prior decision - but in doing so, it was not suggesting that it would necessarily alter its initial determination. (ECF No. 211.) In addition, plaintiffs have separately moved for this Court to amend its class certification ruling to include Count Three, the § 102 "Summary Plan Description" claim, in such certification. The instant Opinion resolves both of these issues in plaintiffs favor.
I. THE ISSUES
Defendant makes two main arguments as to why the Court erroneously determined that common issues predominate: (1) proof of reliance (which it asserts is a necessary element of plaintiffs' claims based on misrepresentations) necessarily requires individualized inquiries and is not amenable to generalized proof; and (2) questions regarding whether each plaintiffs claim is within the statute of limitations also requires individual inquiry. After studying these questions again, reading any even potentially relevant case law in this area, and examining the record on this motion, the Court confirms its prior decision for all of the reasons set forth in its Opinion from September 24, 2014 as well as for the additional reasons set forth below.
II. PLAINTIFF'S CLAIMS
While plaintiff Osberg initially asserted four claims, at this time only two claims remain: Count Three, alleging violations of ERISA § 102(a), and Count Four, alleging violations of§ 404(a). These counts seek plan reformation on the basis that defendant made false and material misstatements and omissions in its adoption of the 1995 pension plan amendment (effective as of January 1, 1996) in violation of §§102, 204(h) and 404(a). Plan reformation is, as the Supreme Court found in CIGNA v. Amara, 131 S.Ct. 1866, 1879-80 (2011), essentially an equitable remedy.
Defendant asserts that for claims based on a misrepresentation, plaintiffs must prove individualized reliance. Plaintiffs argue that reliance is not a required element of either claim. This Court previously found, based, inter alia, on Amara, that detrimental reliance is not required in the context of a plan reformation claim. 131 S.Ct. at 1881 ("a showing of detrimental reliance... is not [a] necessary element of an ERISA plan reformation claim.") However, the propriety of class certification does not depend on that determination alone. Even if reliance is required, class certification on the facts before this Court is entirely supportable as reliance can be demonstrated on a generalized basis. Further, to the extent plaintiffs' claim relates to omissions, the law is clear that a demonstration of reliance is not required. This Court has also previously found, and does not here revisit, that there are no material differences in communications on which the alleged misrepresentations and omissions are based.
The Court has previously found that the elements of Rule 23(a) have been satisfied by a preponderance of the evidence. It does not appear that defendants have serious concerns with the Court's determination as to any issues other than predominance; they have framed their concerns in terms of the standards governing predominance.
Predominance tests whether the proposed class is sufficiently cohesive to warrant adjudication by representation. Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623 (1997); Myers v. Hertz Corp., 624 F.3d 537, 547 (2d Cir. 2010) ("The requirement's purpose is to ensure that the class will be certified only when it would achieve economies of time, effort, and expense, and promote uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results.") (alteration, citations, and internal quotation marks omitted).
Whether the required elements of a claim may be demonstrated through generalized proof is the sine qua non of predominance. "Economies of time, effort and expense in fully resolving each plaintiffs claims will only be served, and the predominance requirement satisfied, if the plaintiffs can show that" the question at issue can be "answered with respect to the members of the class as a whole through generalized proof and that those common issues are more substantial than individualized ones." Myers, at 549 (alteration, citations, and internal quotation marks omitted); see also UFCW Local 1776 v. Eli Lilly & Co., 620 F.3d 121, 131 (2d Cir. 2010) ("Class-wide issues predominate if resolution of some of the legal or factual questions that qualify each class member's case as a genuine controversy can be achieved through generalized proof, and if these issues are more substantial than the issues subject only to individualized proof.")
That there may be some individualized issues does not necessarily defeat predominance-it is a question of the balance. See Public Employees' Retirement System of Mississippi v. Merrill Lynch & Co., Inc., 277 F.R.D. 97, 110-19 (S.D.N.Y. 2011); In re NYSE Specialists Secs. Litig., 260 F.R.D. 55, 74-77 (S.D.N.Y. 2009).
Misrepresentation claims do not always require individualized proof of reliance. Defendant's assertion to the contrary simply ignores Second Circuit case law. It is useful to discuss - in the order in which they were ...