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16CV300096
Santa Clara — Civil
CIV-130
ATTORNEY OR PARTY WITHOUT ATTORNEY (Name, State Bar number, and address). FOR COURT USE ONLY . Fleming
— Fred W. Schwinn (SBN 225575)
Consumer Law Center, Inc. Electronically Filed
38 West Santa Clara Street by Superior Court of CA,
San Jose, California 95113-1806
TELEPHONE No.(408) 294-6100 FAXNO. (Optiona):(408) 294-6190
EMAIL ADDRESS (Optionay: — fred.schwinn@sjconsumerlaw.com
County of Santa Clara,
on 9/1/2022 10:57 AM
ATTORNEY FoR (Name: _ MARIA ANTONIA CANUL Reviewed By: R. Fleming
SUPERIOR COURT OF CALIFORNIA, COUNTY OF SANTA CLARA Case #16CV300096
STREET ADDRESS 191 North First Street Envelope: 9865087
MAILING ADDRESS: 191 North First Street
CITY AND ZIP CODE: San Jose, CA 95113
srancHName: Downtown San Jose
PLAINTIFF/PETITIONER: VELOCITY INVESTMENTS, LLC
DEFENDANT/RESPONDENT: MARIA ANTONIA CANUL
CASE NUMBER:
NOTICE OF ENTRY OF JUDGMENT
OR ORDER 16CV300096
(Check one): [X]} UNLIMITED CASE () LIMITED CASE
(Amount demanded (Amount demanded was
exceeded $25,000) $25,000 or less)
TO ALL PARTIES:
1. Ajudgment, decree, or order was entered in this action on (date): August 31, 2022
2. A copy of the judgment, decree, or order is attached to this notice.
Date: September 1, 2022 ,
(MFEORPRINTNAWE OF (Q) arronney [panty wrmout arrow)
(SIGNATURE)
Page 1 of 2
Form Approved for Optional Use NOTICE OF ENTRY OF JUDGMENT OR ORDER www.courtinfo.ca.gov
Judicial Couneil of California
Civ-130 [New January 1, 2010]
CEB | Essential
cebcom | {2|Forms:POS-050/EFS-050
[ATTORNEY OR PARTY WITHOUT ATTORNEY: STATE BAR NO
name: Fred W. Schwinn (SBN 225575)
rirwname: Consumer Law Center, Inc.
street anpress: 38 West Santa Clara Street
ery: San Jose state: CA zip cove: 95113-1806
reveproneno: (408) 294-6100 eaxno: (408) 294-6190
eat aooress: fred.schwinn@sjconsumerlaw.com
ATTORNEY FOR (name): MARIA ANTONIA CANUL
SUPERIOR COURT OF CALIFORNIA, COUNTY OF SANTA CLARA
street aooress: 191 North First Street
manne aopress: 191 North First Street
city ano zip cove: San Jose, CA 95113
srancH Name: Downtown San Jose
FOR COURT USE ONLY
PLAINTIFF/PETITIONER: VELOCITY INVESTMENTS, LLC
DEFENDANT/RESPONDENT: MARIA ANTONIA CANUL
CASE NUMBER:
16CV300096
PROOF OF ELECTRONIC SERVICE
JUDICIAL OFFICER:
Patricia M. Lucas
DEPARTMENT:
3
1. lam atleast 18 years old.
a. My residence or business address is (specify):
38 West Santa Clara Street
San Jose, California 95113-1806
b. My electronic service address is (specify):
fred.schwinn@sjconsumerlaw.com
2. | electronically served the following documents (exact titles):
Notice of Entry of Judgment or Order
(CD The documents served are listed in an attachment. (Form POS-050(D)/EFS-050(D) may be used for this purpose.)
3. | electronically served the documents listed in 2 as follows:
a. Name of person served: Justin M. Penn, Michael Mauceri, Shalini Bhasker
On behalf of (name or names of parties represented, if person served is an attorney):
VELOCITY INVESTMENTS, LLC; VELOCITY PORTFOLIO GROUP, INC.
b. Electronic service address of person served: _jpenn@hinshawlaw.com, mmauceri@hinshawlaw.com, sbhasker@hinshawlaw.com
c. On (date): September 1, 2022
(C) The documents listed in item 2 were served electronically on the persons and in the manner described in an attachment.
(Form POS-050(P)/EFS-050(P) may be used for this purpose.)
Date: September 1, 2022
| declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct.
Fred W. Schwinn (SBN 225575) > Sf
(TYPE OR PRINT NAME OF DECLARANT) (SIGNATURE OF DECLARANT)
Page 1 of 1
Form Approved for Optional Use PROOF OF ELECTRONIC SERVICE
POS SSO RES 080 (Rev February 1, 2017] (Proof of Service/Electronic Filing and Service)
CEB | Essential
cebcom | {2)Forms”
Cal. Rules of Court, rule 2.251
winw.courts.ca.govuN
com ND BR Ww
SUPERIOR COURT OF CALIFORNIA
COUNTY OF SANTA CLARA
VELOCITY INVESTMENTS, LLC,
Plaintiff,
vs.
MARIA CANUL,
Defendant.
MARIA ANTONIA CANUL, on behalf of herself
and all others similarly situated,
Cross-Complainant,
vs.
VELOCITY INVESTMENTS, LLC, a New
Jersey limited liability company; VELOCITY
PORTFOLIO GROUP, INC., a Delaware
corporation; and ROES 2 through 10, inclusive,
Cross-Defendants.
Case No. 16CV30096
ORDER RE: MOTION FOR CLASS
CERTIFICATION
The above-entitled matter came on for hearing on Wednesday, August 31, 2022, at 1:30
p.m. in Department 3, the Honorable Patricia M. Lucas presiding. The court reviewed and
considered the written submissions filed by the parties and issued a tentative ruling on or before
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ORDER RE: MOTION FOR CLASS CERTIFICATIONuN
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Tuesday, August 30, 2022. No party contested the tentative ruling; therefore, the court orders
that the tentative ruling be adopted as the order of the court, as follows:
IL INTRODUCTION
According to the allegations of the Complaint, filed on September 20, 2016, plaintiff and
cross-defendant Velocity Investments, LLC (“Velocity”) is the owner of debt owed by defendant
and cross-complainant Maria Canul (“Canul”). (Complaint, ff] 4-5.) In the Complaint, Velocity
alleges that the charge-off creditor was LendingClub Corporation, Velocity complied with Civil
Code section 1788.52, and the document titled “Truth in Lending Disclosure” attached to the
Complaint satisfies Civil Code section 1788.52, subdivision (b). (/bid.) The Complaint sets
forth common counts for: (1) Open Book Account; and (2) Money Lent.
On February 19, 2019, Canul filed a putative class action Cross-Complaint against
Velocity, alleging a single cause of action for California Fair Debt Buying Practices Act
(“CFDBPA”).
On January 29, 2021, Canul filed an amendment to the Cross-Complaint substituting
Velocity Portfolio Group, Inc. (“VPGT”) for Roe 1.
Canul then filed a First Amended Cross-Complaint (“FACC”) on November 4, 2021,
which added allegations regarding an electronic promissory note, allegations identifying the
creditor at the time of charge of by name, allegations regarding violations of Civil Code sections
1788.52 and 1788.58, and alter ego allegations specific to VPGI.
Canul now moves for class certification. Velocity and VPGI (collectively, “Cross-
Defendants”) oppose the motion.
I. REQUEST FOR JUDICIAL NOTICE
In connection with her reply, Canul asks the court to take judicial notice of various state
court records relating to the underlying collection complaints at issue in the pending motion.
The court records are proper subjects of judicial notice under Evidence Code section 452,
subdivision (d). (See Code Civ. Proc., § 452, subd. (d) [permitting judicial notice of court
records].)
Accordingly, Canul’s request for judicial notice is GRANTED.
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Il. LEGAL STANDARD
As explained by the California Supreme Court:
The certification question is essentially a procedural one that does not ask whether
an action is legally or factually meritorious. A trial court ruling on a certification
motion determines whether the issues which may be jointly tried, when compared
with those requiring separate adjudication, are so numerous or substantial that the
maintenance of a class action would be advantageous to the judicial process and
to the litigants.
(Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326 (Sav-On), internal
quotation marks, ellipses, and citations omitted.)
California Code of Civil Procedure section 382 authorizes certification of a class “when
the question is one of a common or general interest, of many persons, or when the parties are
numerous, and it is impracticable to bring them all before the court ... .” As interpreted by the
California Supreme Court, section 382 requires: (1) an ascertainable class; and (2) a well-
defined community of interest among the class members. (Sav-On, supra, 34 Cal.4th at p. 326.)
The “community-of-interest” requirement encompasses three factors: (1) predominant
questions of law or fact; (2) class representatives with claims or defenses typical of the class;
and, (3) class representatives who can adequately represent the class. (Sav-On, supra, 34 Cal.4th|
at p. 326.) “Other relevant considerations include the probability that each class member will
come forward ultimately to prove his or her separate claim to a portion of the total recovery and
whether the class approach would actually serve to deter and redress alleged wrongdoing.”
(Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.) The plaintiff has the burden of
establishing that class treatment will yield “substantial benefits” to both “the litigants and to the
court.” (Blue Chip Stamps v. Superior Court (1976) 18 Cal.3d 381, 385.)
IV. DISCUSSION
A. Ascertainable Class
“The trial court must determine whether the class is ascertainable by examining (1) the
class definition, (2) the size of the class and (3) the means of identifying class members.”
(Miller v. Woods (1983) 148 Cal.App.3d 862, 873.) “Class members are ‘ascertainable’ where
they may be readily identified without unreasonable expense or time by reference to official
records.” (Rose v. City of Hayward (1981) 126 Cal.App.3d 926, 932.)
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Canul seeks certification of the following class:
All persons with addresses in California against whom Cross-Defendants filed a
collection Complaint in the form of Exhibit “1” to the [FACC] herein, in an
attempt to collect a charged-off consumer debt originally owed to WEBBANK,
which was sold or resold to [Velocity] on or after January 1, 2014, during the
period October 24, 2018, through the date of class certification.
(Notice of Motion and Defendant/Cross-Complainant’s Motion for Class Certification, p. 2:2-7.)
The same class definition is proposed in the FACC. (FACC, § 35.) Canul states that Cross-
Defendants provided discovery responses advising that the putative class is estimated to be 1,845)
individuals based on Cross-Defendants’ review of records.
The proposed class definition uses objective criteria and class members can be
ascertained from Cross-Defendants’ records. Furthermore, it is estimated that there are
approximately 1,845 class members. Thus, the class is both ascertainable and sufficiently
numerous.
In opposition, Cross-Defendants’ contend that the class definition is ambiguous because
the proposed class overlaps with classes proposed in the following cases: (1) Velocity
Investments, LLC v. Pascual (Santa Clara County Superior Court, Case No. 18CV338986)
(“Pascual”); (2) Velocity Investments, LLC v. Sipin (Santa Clara County Superior Court, Case
No. 18CV338986) (“Sipin”); (3) Velocity Investments, LLC v. Jayawardena (Santa Clara County]
Superior Court, Case No. 19CV357372) (“Jayawardena’’); and (4) Velocity Investments, LLC v.
Thong Nguyen (San Joaquin County Superior Court, Case No. STK-CV-UCC-2019-15406)
(“Nguyen”). Cross-Defendants also state that the class definition is ambiguous because it is
based upon the form of the underlying collection complaint and some of Canul’s theories (e.g.,
what documents were accessible to Cross-Defendants at the time they initiated the collection
lawsuit) have nothing to do with the form of the collection complaint. Cross-Defendants
conclude that this ambiguity creates ascertainability issues.
Cross-Defendants’ arguments lack merit. First, Cross-Defendants do not adequately
explain, and it is unclear to the court, why overlapping class definitions would render the
proposed class definition in this case ambiguous. The purported fact that the proposed class
definition in this case may overlap with the proposed class definition in another case does not
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mean that the court and parties are unable to identify the persons who are members of the
proposed class in this case.
Second, as Canul persuasively argues in reply, Cross-Defendants have not established
that the proposed class definition in this case overlaps with the class definitions proposed in
Pascual, Sipin, Jayawardena, and Nguyen. As the parties point out, the classes proposed in each
case include persons in California against whom Cross-Defendants filed a collection complaint
“in the form of Exhibit ‘1’ ” during certain time periods. However, “in the form of Exhibit ‘1’ ”
means something different in each of the five cases because the “Exhibit ‘1’ ” at issue in each
case is different. For example in this case, the underlying collection complaint alleges that the
charge-off creditor is LendingClub Corporation and attaches a “Truth in Lending Disclosure”
printout that purports to satisfy Civil Code section 1788.52, subdivision (b). In the FACC, Canul
alleges that the collection complaint falsely alleges that the charge-off creditor is LendingClub
Corporation (when the charge-off creditor is actually LC Trust I) and the “Truth in Lending
Disclosure” printout does not satisfy Civil Code section 1788.52, subdivision (b). (FACC, J 18
& 22-27.) In the underlying collection complaints filed in Pascual and Sipin, the alleged charge-'
off creditor is different than the one at issue in this case. In the underlying collection complaints
filed in Pascual, Sipin, Jayawardena, and Nguyen, the attached documents that purportedly
satisfy Civil Code section 1788.52, subdivision (b) are different than the document at issue in
this case. Because the “Exhibit ‘1’ ” at issue in each case is different, there does not appear to be!
any overlap among the proposed classes. This conclusion is further supported by Canul’s
evidence that the named plaintiffs in Pascual, Sipin, Javyawardena, and Nguyen do not appear on
the class list produced by Cross-Defendants in this case. (Supplemental Declaration of Fred W.
Schwinn in Support of Defendant/Cross-Complainant’s Motion for Class Certification, {fj 3-4.)
Third, Cross-Defendants do not point to any allegations in the FACC that support their
conclusory assertion that Canul alleges theories that have nothing to do with the form of the
underlying collection complaint (e.g., what documents were accessible to Cross-Defendants at
the time they initiated the collection lawsuit). Furthermore, the purported fact that a particular
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legal theory alleged by Canul does not arise out of the form of the underlying complaint does not
demonstrate that the proposed class is not ascertainable from Cross-Defendants’ records.
B. Community of Interest
1. Predominant Questions of Law or Fact
Regarding the predominance of questions of law or fact:
The ultimate question in every case of this type is whether ... the issues which
may be jointly tried, when compared with those requiring separate adjudication,
are so numerous or substantial that the maintenance of a class action would be
advantageous to the judicial process and to the litigants.
(Lockheed Martin Corp. v. Superior Court (2003) 29 Cal.4th 1096, 1104-1105, quoting Collins
v. Rocha (1972) 7 Cal.3d 232, 238.) The answer hinges on “whether the theory of recovery
advanced by the proponents of certification is, as an analytical matter, likely to prove amenable
to class treatment.” (Sav-On, supra, 34 Cal.4th at p. 327.)
Canul argues that common legal and factual issues predominate because the class
members’ claim for violation of the CFDBPA arises from Cross-Defendants’ practice of filing
collections lawsuits that falsely identify LendingClub Corporation as the charge-off creditor and
falsely state that the attached “Truth in Lending Disclosure” printout satisfies Civil Code section
1788.52, subdivision (b). Canul states that Cross-Defendants filed nearly identical collection
complaints against every member of the proposed class and, therefore, the case will not turn on
circumstances or characteristic of individual class members.
Cross-Defendants make no argument in opposition to this factor.
As Canul persuasively argues, the claim will turn on issues regarding the underlying
collection complaints filed by Cross-Defendants and its conduct and practice with respect to
class members. The factual and legal issues are susceptible to class-wide proof. Thus, the court
finds that common questions of law and fact predominate over individual issues.
2. Typicality
The typicality requirement is meant to ensure that the class representative is able to
adequately represent the class and focus on common issues. It is only when a defense
unique to the class representative will be a major focus of the litigation, or when the class
representative’s interests are antagonistic to or in conflict with the objectives of those she
purports to represent that denial of class certification is appropriate. But even then, the
court should determine if it would be feasible to divide the class into subclasses to
eliminate the conflict and allow the class action to be maintained.
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(Medrazo v. Honda of North Hollywood (2008) 166 Cal. App. 4th 89, 99, internal citations,
brackets, and quotation marks omitted.)
Cross-Defendants make no argument in opposition to this factor and there is no
contention that Canul does not have a similar claim to other putative class members with regard
to common issues surrounding the alleged violation of the CFDBPA. Consequently, the court
finds that Canul has met the typicality requirement.
3. Adequacy of Representation
“Adequacy of representation depends on whether the plaintiff's attorney is qualified to
conduct the proposed litigation and the plaintiff's interests are not antagonistic to the interests of
the class.” (McGhee v. Bank of America (1976) 60 Cal. App. 3d 442, 450.) The fact that a class
representative does not personally incur all of the damages suffered by each different class
member does not necessarily preclude the representative from providing adequate representation
to the class. (Wershba v. Apple Computer, Inc. (2001) 91 Cal. App. 4th 224, 238.)
Canul introduces evidence that class counsel is well qualified to conduct this litigation,
which Cross-Defendants do not dispute. (Declaration of Fred. W. Schwinn in Support of
Defendant/Cross-Complainant’s Motion for Class Certification, {J 1-11; Declaration of Raeon
R. Roulston in Support of Defendant/Cross-Complainant’s Motion for Class Certification, {| 1-
11; Declaration of Matthew C. Salmonsen in Support of Defendant/Cross-Complainant’s Motion
for Class Certification, ff 1-8.) Canul also submits a declaration stating that she understands her
duties to the class and intends to fulfill them. (Declaration of Maria Antonia Canul in Support of|
Defendant/Cross-Complainant’s Motion for Class Certification, ff] 6-11.) Thus, the court finds
that Canul has met the adequacy of representation requirement.
In opposition, Cross-Defendants argue Canul’s counsel cannot adequately represent the
class in this case because Canul’s counsel also represent the putative classes in Pascual, Sipin,
Jayawardena, and Nguyen; the proposed class definitions in the cases overlap; and Canul’s
counsel therefore has a conflict of interest.
Cross-Defendants’ arguments are not well taken. First, as explained above, Cross-
Defendants have not demonstrated that the proposed class in this case overlaps with the proposed}
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ORDER RE: MOTION FOR CLASS CERTIFICATIONuN
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classes in Pascual, Sipin, Jayawardena, and Nguyen. Second, as Canul persuasively argues,
Cross-Defendants have not shown that the interests of the proposed classes in the five actions are!
inherently opposed. The federal decisions cited by Cross-Defendants have only found counsel
inadequate due to conflicts where the recovery of one group in one forum inherently conflicts
with the recovery of the other (e.g., where a limited fund means that the recovery of one claimant]
will cut directly into recovery by another; where substantive law permits recovery by only one or|
the other set of litigants; or where one client is litigating an appeal to a class action settlement in
which another client claimed recovery). (See Sandoval v. M1 Auto Collisions Ctrs. (N.D.Cal.
2015) 309 F.R.D. 549, 569-570.) Because there is no such inherent conflict in this case, Cross-
Defendants’ argument lacks merit.
Cc. Substantial Benefits of Class Litigation
“[A] class action should not be certified unless substantial benefits accrue both to
litigants and the courts ... .” (Basurco v. 21st Century Insurance Co. (2003) 108 Cal.App.4th
110, 120, internal quotation marks omitted.) The question is whether a class action would be
superior to individual lawsuits. (bid.) “Thus, even if questions of law or fact predominate, the
lack of superiority provides an alternative ground to deny class certification.” (Jbid.) Generally,
“a class action is proper where it provides small claimants with a method of obtaining redress
and when numerous parties suffer injury of insufficient size to warrant individual action.” (/d. at
pp. 120-121, internal quotation marks omitted.)
Cross-Defendants argue that there are no substantial benefits to proceeding as a class
action because the proposed class definitions in the five actions overlap and, therefore, there are
concerns regarding which class it would be most advantageous for an individual to join. Cross-
Defendants also contend that individual class members could potentially receive more in an
individual case because the total recovery in the class action will be divided by the number of
class members.
Cross-Defendants’ arguments are not well taken. As explained above, Cross-Defendants
have not established that there is any overlap among the proposed classes in the five proceedings]
Thus, Cross-Defendants’ concerns regarding class members choosing a more advantageous case
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are unfounded. Moreover, although it is possible that individual class members could potentially!
recover more if they brought individual lawsuits, the factual and legal issues to be decided by the’
court in this case are common throughout the class. It would be inefficient for the court to hear
and decide the same issues separately and repeatedly for each class member. Consequently, the
court finds that a class action would be superior in this case.
D. Conclusion
Accordingly, Canul’s motion for class certification is GRANTED.
Dated: August 31, 2022 Foti vc Om he cary
Patricia M. Lucas
Judge of the Superior Court
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ORDER RE: MOTION FOR CLASS CERTIFICATION
Preview
16CV300096 Santa Clara — Civil CIV-130 ATTORNEY OR PARTY WITHOUT ATTORNEY (Name, State Bar number, and address). FOR COURT USE ONLY . Fleming — Fred W. Schwinn (SBN 225575) Consumer Law Center, Inc. Electronically Filed 38 West Santa Clara Street by Superior Court of CA, San Jose, California 95113-1806 TELEPHONE No.(408) 294-6100 FAXNO. (Optiona):(408) 294-6190 EMAIL ADDRESS (Optionay: — fred.schwinn@sjconsumerlaw.com County of Santa Clara, on 9/1/2022 10:57 AM ATTORNEY FoR (Name: _ MARIA ANTONIA CANUL Reviewed By: R. Fleming SUPERIOR COURT OF CALIFORNIA, COUNTY OF SANTA CLARA Case #16CV300096 STREET ADDRESS 191 North First Street Envelope: 9865087 MAILING ADDRESS: 191 North First Street CITY AND ZIP CODE: San Jose, CA 95113 srancHName: Downtown San Jose PLAINTIFF/PETITIONER: VELOCITY INVESTMENTS, LLC DEFENDANT/RESPONDENT: MARIA ANTONIA CANUL CASE NUMBER: NOTICE OF ENTRY OF JUDGMENT OR ORDER 16CV300096 (Check one): [X]} UNLIMITED CASE () LIMITED CASE (Amount demanded (Amount demanded was exceeded $25,000) $25,000 or less) TO ALL PARTIES: 1. Ajudgment, decree, or order was entered in this action on (date): August 31, 2022 2. A copy of the judgment, decree, or order is attached to this notice. Date: September 1, 2022 , (MFEORPRINTNAWE OF (Q) arronney [panty wrmout arrow) (SIGNATURE) Page 1 of 2 Form Approved for Optional Use NOTICE OF ENTRY OF JUDGMENT OR ORDER www.courtinfo.ca.gov Judicial Couneil of California Civ-130 [New January 1, 2010] CEB | Essential cebcom | {2|Forms:POS-050/EFS-050 [ATTORNEY OR PARTY WITHOUT ATTORNEY: STATE BAR NO name: Fred W. Schwinn (SBN 225575) rirwname: Consumer Law Center, Inc. street anpress: 38 West Santa Clara Street ery: San Jose state: CA zip cove: 95113-1806 reveproneno: (408) 294-6100 eaxno: (408) 294-6190 eat aooress: fred.schwinn@sjconsumerlaw.com ATTORNEY FOR (name): MARIA ANTONIA CANUL SUPERIOR COURT OF CALIFORNIA, COUNTY OF SANTA CLARA street aooress: 191 North First Street manne aopress: 191 North First Street city ano zip cove: San Jose, CA 95113 srancH Name: Downtown San Jose FOR COURT USE ONLY PLAINTIFF/PETITIONER: VELOCITY INVESTMENTS, LLC DEFENDANT/RESPONDENT: MARIA ANTONIA CANUL CASE NUMBER: 16CV300096 PROOF OF ELECTRONIC SERVICE JUDICIAL OFFICER: Patricia M. Lucas DEPARTMENT: 3 1. lam atleast 18 years old. a. My residence or business address is (specify): 38 West Santa Clara Street San Jose, California 95113-1806 b. My electronic service address is (specify): fred.schwinn@sjconsumerlaw.com 2. | electronically served the following documents (exact titles): Notice of Entry of Judgment or Order (CD The documents served are listed in an attachment. (Form POS-050(D)/EFS-050(D) may be used for this purpose.) 3. | electronically served the documents listed in 2 as follows: a. Name of person served: Justin M. Penn, Michael Mauceri, Shalini Bhasker On behalf of (name or names of parties represented, if person served is an attorney): VELOCITY INVESTMENTS, LLC; VELOCITY PORTFOLIO GROUP, INC. b. Electronic service address of person served: _jpenn@hinshawlaw.com, mmauceri@hinshawlaw.com, sbhasker@hinshawlaw.com c. On (date): September 1, 2022 (C) The documents listed in item 2 were served electronically on the persons and in the manner described in an attachment. (Form POS-050(P)/EFS-050(P) may be used for this purpose.) Date: September 1, 2022 | declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Fred W. Schwinn (SBN 225575) > Sf (TYPE OR PRINT NAME OF DECLARANT) (SIGNATURE OF DECLARANT) Page 1 of 1 Form Approved for Optional Use PROOF OF ELECTRONIC SERVICE POS SSO RES 080 (Rev February 1, 2017] (Proof of Service/Electronic Filing and Service) CEB | Essential cebcom | {2)Forms” Cal. Rules of Court, rule 2.251 winw.courts.ca.govuN com ND BR Ww SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA VELOCITY INVESTMENTS, LLC, Plaintiff, vs. MARIA CANUL, Defendant. MARIA ANTONIA CANUL, on behalf of herself and all others similarly situated, Cross-Complainant, vs. VELOCITY INVESTMENTS, LLC, a New Jersey limited liability company; VELOCITY PORTFOLIO GROUP, INC., a Delaware corporation; and ROES 2 through 10, inclusive, Cross-Defendants. Case No. 16CV30096 ORDER RE: MOTION FOR CLASS CERTIFICATION The above-entitled matter came on for hearing on Wednesday, August 31, 2022, at 1:30 p.m. in Department 3, the Honorable Patricia M. Lucas presiding. The court reviewed and considered the written submissions filed by the parties and issued a tentative ruling on or before 1 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww Tuesday, August 30, 2022. No party contested the tentative ruling; therefore, the court orders that the tentative ruling be adopted as the order of the court, as follows: IL INTRODUCTION According to the allegations of the Complaint, filed on September 20, 2016, plaintiff and cross-defendant Velocity Investments, LLC (“Velocity”) is the owner of debt owed by defendant and cross-complainant Maria Canul (“Canul”). (Complaint, ff] 4-5.) In the Complaint, Velocity alleges that the charge-off creditor was LendingClub Corporation, Velocity complied with Civil Code section 1788.52, and the document titled “Truth in Lending Disclosure” attached to the Complaint satisfies Civil Code section 1788.52, subdivision (b). (/bid.) The Complaint sets forth common counts for: (1) Open Book Account; and (2) Money Lent. On February 19, 2019, Canul filed a putative class action Cross-Complaint against Velocity, alleging a single cause of action for California Fair Debt Buying Practices Act (“CFDBPA”). On January 29, 2021, Canul filed an amendment to the Cross-Complaint substituting Velocity Portfolio Group, Inc. (“VPGT”) for Roe 1. Canul then filed a First Amended Cross-Complaint (“FACC”) on November 4, 2021, which added allegations regarding an electronic promissory note, allegations identifying the creditor at the time of charge of by name, allegations regarding violations of Civil Code sections 1788.52 and 1788.58, and alter ego allegations specific to VPGI. Canul now moves for class certification. Velocity and VPGI (collectively, “Cross- Defendants”) oppose the motion. I. REQUEST FOR JUDICIAL NOTICE In connection with her reply, Canul asks the court to take judicial notice of various state court records relating to the underlying collection complaints at issue in the pending motion. The court records are proper subjects of judicial notice under Evidence Code section 452, subdivision (d). (See Code Civ. Proc., § 452, subd. (d) [permitting judicial notice of court records].) Accordingly, Canul’s request for judicial notice is GRANTED. 2 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww Il. LEGAL STANDARD As explained by the California Supreme Court: The certification question is essentially a procedural one that does not ask whether an action is legally or factually meritorious. A trial court ruling on a certification motion determines whether the issues which may be jointly tried, when compared with those requiring separate adjudication, are so numerous or substantial that the maintenance of a class action would be advantageous to the judicial process and to the litigants. (Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326 (Sav-On), internal quotation marks, ellipses, and citations omitted.) California Code of Civil Procedure section 382 authorizes certification of a class “when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court ... .” As interpreted by the California Supreme Court, section 382 requires: (1) an ascertainable class; and (2) a well- defined community of interest among the class members. (Sav-On, supra, 34 Cal.4th at p. 326.) The “community-of-interest” requirement encompasses three factors: (1) predominant questions of law or fact; (2) class representatives with claims or defenses typical of the class; and, (3) class representatives who can adequately represent the class. (Sav-On, supra, 34 Cal.4th| at p. 326.) “Other relevant considerations include the probability that each class member will come forward ultimately to prove his or her separate claim to a portion of the total recovery and whether the class approach would actually serve to deter and redress alleged wrongdoing.” (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.) The plaintiff has the burden of establishing that class treatment will yield “substantial benefits” to both “the litigants and to the court.” (Blue Chip Stamps v. Superior Court (1976) 18 Cal.3d 381, 385.) IV. DISCUSSION A. Ascertainable Class “The trial court must determine whether the class is ascertainable by examining (1) the class definition, (2) the size of the class and (3) the means of identifying class members.” (Miller v. Woods (1983) 148 Cal.App.3d 862, 873.) “Class members are ‘ascertainable’ where they may be readily identified without unreasonable expense or time by reference to official records.” (Rose v. City of Hayward (1981) 126 Cal.App.3d 926, 932.) 3 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww Canul seeks certification of the following class: All persons with addresses in California against whom Cross-Defendants filed a collection Complaint in the form of Exhibit “1” to the [FACC] herein, in an attempt to collect a charged-off consumer debt originally owed to WEBBANK, which was sold or resold to [Velocity] on or after January 1, 2014, during the period October 24, 2018, through the date of class certification. (Notice of Motion and Defendant/Cross-Complainant’s Motion for Class Certification, p. 2:2-7.) The same class definition is proposed in the FACC. (FACC, § 35.) Canul states that Cross- Defendants provided discovery responses advising that the putative class is estimated to be 1,845) individuals based on Cross-Defendants’ review of records. The proposed class definition uses objective criteria and class members can be ascertained from Cross-Defendants’ records. Furthermore, it is estimated that there are approximately 1,845 class members. Thus, the class is both ascertainable and sufficiently numerous. In opposition, Cross-Defendants’ contend that the class definition is ambiguous because the proposed class overlaps with classes proposed in the following cases: (1) Velocity Investments, LLC v. Pascual (Santa Clara County Superior Court, Case No. 18CV338986) (“Pascual”); (2) Velocity Investments, LLC v. Sipin (Santa Clara County Superior Court, Case No. 18CV338986) (“Sipin”); (3) Velocity Investments, LLC v. Jayawardena (Santa Clara County] Superior Court, Case No. 19CV357372) (“Jayawardena’’); and (4) Velocity Investments, LLC v. Thong Nguyen (San Joaquin County Superior Court, Case No. STK-CV-UCC-2019-15406) (“Nguyen”). Cross-Defendants also state that the class definition is ambiguous because it is based upon the form of the underlying collection complaint and some of Canul’s theories (e.g., what documents were accessible to Cross-Defendants at the time they initiated the collection lawsuit) have nothing to do with the form of the collection complaint. Cross-Defendants conclude that this ambiguity creates ascertainability issues. Cross-Defendants’ arguments lack merit. First, Cross-Defendants do not adequately explain, and it is unclear to the court, why overlapping class definitions would render the proposed class definition in this case ambiguous. The purported fact that the proposed class definition in this case may overlap with the proposed class definition in another case does not 4 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww mean that the court and parties are unable to identify the persons who are members of the proposed class in this case. Second, as Canul persuasively argues in reply, Cross-Defendants have not established that the proposed class definition in this case overlaps with the class definitions proposed in Pascual, Sipin, Jayawardena, and Nguyen. As the parties point out, the classes proposed in each case include persons in California against whom Cross-Defendants filed a collection complaint “in the form of Exhibit ‘1’ ” during certain time periods. However, “in the form of Exhibit ‘1’ ” means something different in each of the five cases because the “Exhibit ‘1’ ” at issue in each case is different. For example in this case, the underlying collection complaint alleges that the charge-off creditor is LendingClub Corporation and attaches a “Truth in Lending Disclosure” printout that purports to satisfy Civil Code section 1788.52, subdivision (b). In the FACC, Canul alleges that the collection complaint falsely alleges that the charge-off creditor is LendingClub Corporation (when the charge-off creditor is actually LC Trust I) and the “Truth in Lending Disclosure” printout does not satisfy Civil Code section 1788.52, subdivision (b). (FACC, J 18 & 22-27.) In the underlying collection complaints filed in Pascual and Sipin, the alleged charge-' off creditor is different than the one at issue in this case. In the underlying collection complaints filed in Pascual, Sipin, Jayawardena, and Nguyen, the attached documents that purportedly satisfy Civil Code section 1788.52, subdivision (b) are different than the document at issue in this case. Because the “Exhibit ‘1’ ” at issue in each case is different, there does not appear to be! any overlap among the proposed classes. This conclusion is further supported by Canul’s evidence that the named plaintiffs in Pascual, Sipin, Javyawardena, and Nguyen do not appear on the class list produced by Cross-Defendants in this case. (Supplemental Declaration of Fred W. Schwinn in Support of Defendant/Cross-Complainant’s Motion for Class Certification, {fj 3-4.) Third, Cross-Defendants do not point to any allegations in the FACC that support their conclusory assertion that Canul alleges theories that have nothing to do with the form of the underlying collection complaint (e.g., what documents were accessible to Cross-Defendants at the time they initiated the collection lawsuit). Furthermore, the purported fact that a particular 5 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww legal theory alleged by Canul does not arise out of the form of the underlying complaint does not demonstrate that the proposed class is not ascertainable from Cross-Defendants’ records. B. Community of Interest 1. Predominant Questions of Law or Fact Regarding the predominance of questions of law or fact: The ultimate question in every case of this type is whether ... the issues which may be jointly tried, when compared with those requiring separate adjudication, are so numerous or substantial that the maintenance of a class action would be advantageous to the judicial process and to the litigants. (Lockheed Martin Corp. v. Superior Court (2003) 29 Cal.4th 1096, 1104-1105, quoting Collins v. Rocha (1972) 7 Cal.3d 232, 238.) The answer hinges on “whether the theory of recovery advanced by the proponents of certification is, as an analytical matter, likely to prove amenable to class treatment.” (Sav-On, supra, 34 Cal.4th at p. 327.) Canul argues that common legal and factual issues predominate because the class members’ claim for violation of the CFDBPA arises from Cross-Defendants’ practice of filing collections lawsuits that falsely identify LendingClub Corporation as the charge-off creditor and falsely state that the attached “Truth in Lending Disclosure” printout satisfies Civil Code section 1788.52, subdivision (b). Canul states that Cross-Defendants filed nearly identical collection complaints against every member of the proposed class and, therefore, the case will not turn on circumstances or characteristic of individual class members. Cross-Defendants make no argument in opposition to this factor. As Canul persuasively argues, the claim will turn on issues regarding the underlying collection complaints filed by Cross-Defendants and its conduct and practice with respect to class members. The factual and legal issues are susceptible to class-wide proof. Thus, the court finds that common questions of law and fact predominate over individual issues. 2. Typicality The typicality requirement is meant to ensure that the class representative is able to adequately represent the class and focus on common issues. It is only when a defense unique to the class representative will be a major focus of the litigation, or when the class representative’s interests are antagonistic to or in conflict with the objectives of those she purports to represent that denial of class certification is appropriate. But even then, the court should determine if it would be feasible to divide the class into subclasses to eliminate the conflict and allow the class action to be maintained. 6 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww (Medrazo v. Honda of North Hollywood (2008) 166 Cal. App. 4th 89, 99, internal citations, brackets, and quotation marks omitted.) Cross-Defendants make no argument in opposition to this factor and there is no contention that Canul does not have a similar claim to other putative class members with regard to common issues surrounding the alleged violation of the CFDBPA. Consequently, the court finds that Canul has met the typicality requirement. 3. Adequacy of Representation “Adequacy of representation depends on whether the plaintiff's attorney is qualified to conduct the proposed litigation and the plaintiff's interests are not antagonistic to the interests of the class.” (McGhee v. Bank of America (1976) 60 Cal. App. 3d 442, 450.) The fact that a class representative does not personally incur all of the damages suffered by each different class member does not necessarily preclude the representative from providing adequate representation to the class. (Wershba v. Apple Computer, Inc. (2001) 91 Cal. App. 4th 224, 238.) Canul introduces evidence that class counsel is well qualified to conduct this litigation, which Cross-Defendants do not dispute. (Declaration of Fred. W. Schwinn in Support of Defendant/Cross-Complainant’s Motion for Class Certification, {J 1-11; Declaration of Raeon R. Roulston in Support of Defendant/Cross-Complainant’s Motion for Class Certification, {| 1- 11; Declaration of Matthew C. Salmonsen in Support of Defendant/Cross-Complainant’s Motion for Class Certification, ff 1-8.) Canul also submits a declaration stating that she understands her duties to the class and intends to fulfill them. (Declaration of Maria Antonia Canul in Support of| Defendant/Cross-Complainant’s Motion for Class Certification, ff] 6-11.) Thus, the court finds that Canul has met the adequacy of representation requirement. In opposition, Cross-Defendants argue Canul’s counsel cannot adequately represent the class in this case because Canul’s counsel also represent the putative classes in Pascual, Sipin, Jayawardena, and Nguyen; the proposed class definitions in the cases overlap; and Canul’s counsel therefore has a conflict of interest. Cross-Defendants’ arguments are not well taken. First, as explained above, Cross- Defendants have not demonstrated that the proposed class in this case overlaps with the proposed} 7 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww classes in Pascual, Sipin, Jayawardena, and Nguyen. Second, as Canul persuasively argues, Cross-Defendants have not shown that the interests of the proposed classes in the five actions are! inherently opposed. The federal decisions cited by Cross-Defendants have only found counsel inadequate due to conflicts where the recovery of one group in one forum inherently conflicts with the recovery of the other (e.g., where a limited fund means that the recovery of one claimant] will cut directly into recovery by another; where substantive law permits recovery by only one or| the other set of litigants; or where one client is litigating an appeal to a class action settlement in which another client claimed recovery). (See Sandoval v. M1 Auto Collisions Ctrs. (N.D.Cal. 2015) 309 F.R.D. 549, 569-570.) Because there is no such inherent conflict in this case, Cross- Defendants’ argument lacks merit. Cc. Substantial Benefits of Class Litigation “[A] class action should not be certified unless substantial benefits accrue both to litigants and the courts ... .” (Basurco v. 21st Century Insurance Co. (2003) 108 Cal.App.4th 110, 120, internal quotation marks omitted.) The question is whether a class action would be superior to individual lawsuits. (bid.) “Thus, even if questions of law or fact predominate, the lack of superiority provides an alternative ground to deny class certification.” (Jbid.) Generally, “a class action is proper where it provides small claimants with a method of obtaining redress and when numerous parties suffer injury of insufficient size to warrant individual action.” (/d. at pp. 120-121, internal quotation marks omitted.) Cross-Defendants argue that there are no substantial benefits to proceeding as a class action because the proposed class definitions in the five actions overlap and, therefore, there are concerns regarding which class it would be most advantageous for an individual to join. Cross- Defendants also contend that individual class members could potentially receive more in an individual case because the total recovery in the class action will be divided by the number of class members. Cross-Defendants’ arguments are not well taken. As explained above, Cross-Defendants have not established that there is any overlap among the proposed classes in the five proceedings] Thus, Cross-Defendants’ concerns regarding class members choosing a more advantageous case 8 ORDER RE: MOTION FOR CLASS CERTIFICATIONuN com ND BR Ww are unfounded. Moreover, although it is possible that individual class members could potentially! recover more if they brought individual lawsuits, the factual and legal issues to be decided by the’ court in this case are common throughout the class. It would be inefficient for the court to hear and decide the same issues separately and repeatedly for each class member. Consequently, the court finds that a class action would be superior in this case. D. Conclusion Accordingly, Canul’s motion for class certification is GRANTED. Dated: August 31, 2022 Foti vc Om he cary Patricia M. Lucas Judge of the Superior Court 9 ORDER RE: MOTION FOR CLASS CERTIFICATION