Lewis Tree Service, Inc. v. Lucent Technologies Inc.

211 F.R.D. 228, 2002 U.S. Dist. LEXIS 22383, 2002 WL 31525626
CourtDistrict Court, S.D. New York
DecidedNovember 12, 2002
DocketNo. 99 Civ. 8556(JGK)
StatusPublished
Cited by39 cases

This text of 211 F.R.D. 228 (Lewis Tree Service, Inc. v. Lucent Technologies Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lewis Tree Service, Inc. v. Lucent Technologies Inc., 211 F.R.D. 228, 2002 U.S. Dist. LEXIS 22383, 2002 WL 31525626 (S.D.N.Y. 2002).

Opinion

[229]*229 OPINION AND ORDER

KOELTL, District Judge.

This is a motion brought by the plaintiff, Lewis Tree Service, Inc. (“Lewis Tree”), seeking certification for a nationwide class action lawsuit of a class comprised of all individuals who purchased, leased, or acquired any one of nearly sixty telecommunications products that were sold by the AT & T Corporation (“AT & T”) and its successor, Lucent Technologies, Inc. (“Lucent”), (collectively the “defendants”), over a ten-year period and that allegedly contained defects related to processing of dates including and after January 1, 2000 (the “Y2K defect”).

The original complaint named the law firm of Beatie, King & Abate as the plaintiff and was filed in New York State Court in January, 1999. After the case was removed to federal court, pursuant to 15 U.S.C. § 6614(c)(1) (the “Y2K act”), Beatie, King & Abate was replaced by other named plaintiffs, of which only Lewis Tree now remains.1 In the Third Amended Complaint. Lewis Tree alleged six causes of action related to the Y2K defects and failures contained in the products sold by the defendants. The defendants moved for partial summary judgment on five of these causes of action, and this Court in an opinion and order issued together with this opinion has granted the defendants’ motion in part and denied it in part. See 239 F.Supp.2d 322, Opinion and Order dated November 12, 2002. Consequently, only two of the original six causes of action remain for the purposes of the class action motion-(l) a claim for common law fraud; and (2) a claim for violations of the New Jersey Consumer Fraud Act (“NJCFA”).

The Third Amended Complaint makes various allegations that form the factual basis of this motion for class certification including the following, which for the purposes of this motion for class certification are taken as true. Lewis Tree purchased, leased or acquired one or more of nearly sixty telecommunications products from AT & T or its distributors. (Compl. ¶¶ 1, 76.) These products were all Y2K defective, in that none of the products were able adequately to process information relating to dates on or after January 1, 2000. (Compl. ¶ 3.) The effect of such defects would be to render the products inoperable, ineffective, or obsolete before the end of the expected useful lives of the equipment. (Compl. ¶ 5.) The Third Amended Complaint also alleges that when these products were sold or leased, the defendants knew of these Y2K defects, but deliberately hid them from consumers, and then sought to have the consumers bear the costs of fixing and upgrading the defective systems. (Compl. ¶¶ 4,5,7,81-85.) These misrepresentations, it is alleged, were present in promotional literature sent to purchasers, oral presentations made at the time of sale or as means to induce a sale, and a general company sales and marketing policy of the defendants. (Compl. ¶¶ 4, 5, 70(b)-(:), 110-117, 155-58, 191-92.)

Lewis Tree’s action is brought on behalf of “all persons or entities in the United States who purchased lease or acquired” any one of the sixty products listed in the Third Amended Complaint. (Compl.¶ 64.) The class period is alleged to be from “at least 1990 to the date of the filing of the Third Amended Complaint” in September, 2000. (Compl.¶ 8.) Lewis Tree, thus, seeks certification of a nationwide class of consumers who over a ten-year period purchased enumerated telecommunications equipment that was not programmed to deal with Y2K related problems when sold. The defendants argue that because of the number of individuals who purchased products under different circumstances in all fifty states, and the variance in the facts and law to be applied to the sales to individual purchasers, the plaintiffs claims fail to satisfy the requirements of Fed.R.Civ.P. 23(a) and 23(b)(3), and a class should not be certified. The defendants also argue that the plaintiffs claims fail to satisfy [230]*230the Y2K Act’s requirements for Y2K class actions that any purported defect be material for a majority of members of the class. On the other hand, the plaintiffs argue that class certification is appropriate because the circumstances surrounding the sales were similar and exhibited a common pattern of fraudulent concealment by the defendants, and because the choice of law provisions in the sales agreements require that New Jersey law be applied to all the claims of all plaintiffs. For the reasons explained below, Lewis Tree’s motion for class certification is denied.2

I.

Before certifying a class, the Court must determine that the party seeking certification has satisfied the four prerequisites of Rule 23(a): numerosity, commonality, typicality, and adequacy of representation. See Cari-dad v. Metro-North R.R., 191 F.3d 283, 291 (2d Cir.1999); Marisol A. v. Giuliani, 126 F.3d 372, 375 (2d Cir.1997); Comer v. Cisne-ros, 37 F.3d 775, 796 (2d Cir.1994); Dajour B. v. The City of New York, No. 00 Civ.2044, 2001 WL 1173504, at *3 (S.D.N.Y. Oct.3, 2001). The Court must find, more specifically, that:

(1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class.

Fed.R.Civ.P. 23(a). The Court must also find that the party qualifies under one of the three sets of criteria set forth in Rule 23(b)(1), (2), or (3). See Amchem Products, Inc. v. Windsor, 521 U.S. 591, 614, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997); Comer, 37 F.3d at 796.

Lewis Tree seeks certification under Rule 23(b)(3), which provides for a class to be maintained where “the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy.” Fed.R.Civ.P. 23(b)(3). Rule 23(b)(3) states that:

The matters pertinent to [these required] findings include: (A) the interest of members of the class in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; (D) the difficulties likely to be encountered in the management of a class action.

Id. If the court finds both that the requirements of 23(a) have been met, and that the claims fall within the scope of Rule 23(b)(3), the Court may, in its discretion, certify the class. See In re Drexel Burnham Lambert Group, Inc.,

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211 F.R.D. 228, 2002 U.S. Dist. LEXIS 22383, 2002 WL 31525626, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lewis-tree-service-inc-v-lucent-technologies-inc-nysd-2002.