Motion-Secondary: HONORA KELLER, ET AL VS. THE BOARD OF TRUSTEES OF CALIFORNIA STATE

• 
• 
• 
• 
• 
• 
• 
• 

						
                                
Preview
                                ee LER LALLA ALA LL AAA NA

UOC

SUPERIOR COURT OF CALIFORNIA
COUNTY OF SAN FRANCISCO

Document Scanning Lead Sheet
Feb-09-2012 10:37 am

Case Number: CGC-09-490977
Filing Date: Feb-09-2012 10:36
Juke Box: 001 Image: 03488572
MEMORANDUM OF POINTS AND AUTHORITIES

TRAVIS DONSELMAN, ET AL VS. THE BOARD OF TRUSTEES OF CALIFORNIA STAT

001003488572

Instructions:
Please place this sheet on top of the document to be scanned.

44Nene nF

5

JAMES M. FINBERG (SBN 114850) ‘ 4
JONATHAN WEISSGLASS (SBN 185008) San Francised County superior Court
DANIELLE E. LEONARD (SBN 218201)

Altshuler Berzon LLP

177 Post Street, Suite 300

San Francisco, California 94108 CLE
Telephone: (415) 421-7151 BY: of
Facsimile: (415) 362-8064

ANDREW D. FREEMAN (admitted pro hac vice)
LAURA ABELSON (admitted pro hac vice)
Brown, Goldstein & Levy, LLP

120 E. Baltimore Street, Suite 1700

Baltimore, Maryland 21202

Telephone: (410) 962-1030

Facsimile: (410) 385-0869

SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF SAN FRANCISCO

HONORA KELLER, ¢¢ ai, Case No. CGC-09-490977

Plaintiffs, CLASS ACTION

PLAINTIFFS’ MEMORANDUM OF
POINTS AND AUTHORITIES IN
OPPOSITION TO DEFENDANT’S
MOTION FOR DECERTIFICATION

Dept: 305

Judge: Hon. John E. Munter
Date: March 23, 2012
Time: 2:30 p.m.

THE BOARD OF TRUSTEES OF
CALIFORNIA STATE UNIVERSITY,

Defendant.

ee eee

Action Filed: July 31, 2009
Unlimited Civil Case

Plaintiffs’ Memorandum in Opposition to Motion for DecertificationTABLE OF CONTENTS
INTRODUCTION 2.0.0... 0 cect eee tenet etn renee eens renee eres es
BACKGROUND 2.0.0.0 cece ccc tee teeter ete nese nen e tre ttre s seer eens
A. The Court Certified The Class Based On Facts That Have Not Changed .......-
B. Plaintiffs’ Theory Of Contract Formation Has Not Changed .....--.eee serene
DISCUSSION 0.0... cece ete e eee erent tne ere teen erence terres ener sees
L Because The Motion For Decertification Is Based On “Newly Packaged”
Evidence That Was Always Available, It Is Procedurally Improper .....-..-----
Il. This Court Correctly Concluded In The Class Certification Decision That
It Is Capable Of Managing The Legal And Factual Issues Raised By
Plaintiffs’ Claims ... 00.000. c ee cee cee eee teen eee n res
A. Formation Of Class Members’ Contracts With CSU Will Be Proven
Through Common Evidence .......... 00s eee e tree erste eens
B. Plaintiffs Will Prove Interpretation And Breach By Common Evidence,
And Any Issues Raised By CSU’s Defenses Are Manageable .........-
Il. California Class Action Law Has Not Changed Since This Court Correctly
Certified The Subclasses... 2.0206 cece cence nee teen ener n en ees
CONCLUSION 00.00 ccc ccc cnet nner e enn n ersten ener ere nen ere

i

Plaintiffs’ Memorandum in Opposition to Motion for DecertificationTABLE OF AUTHORITIES
STATE CASES

Andersen y. Regents of Univ. of Cal.,

22 Cal.App.3d 763 (1972) 0.0.0.2 c cece etree terete nee tees 12
Ben-Zvi v. Edmar Co.,

40 Cal.App.4th 468 (1995)... eee cece eee cere eee tet eee nen e es 15
Burgermeister Brewing Corp. v. Bowman,

227 Cal.App.2d 274 (1964) oo. cece cere t etree teen neers 11
Davis-Miller v. Automobile Club of Southern California,

201 Cal.App.4th 106 (2011) 2.0... cece eect eee ett ees 18
Fairbanks v. Farmers New World Life Insurance Co.

197 Cal.App.4th 544 (2011) cece eee eee teeter eee ene ee 19
Garcia v. Hejmadi,

58 Cal.App.4th 674 (1997)... 0. eee cece ener t teeters ereees 6
Green v. Obledo,

29 Cal.3d 126 (1981)... 2c eet tnt e ees 2,6
Guz v. Bechtel Nat'l,

24 Cal.4th 317 (2000) 20.0. eee en neers 8, 16
Harris y. Superior Court,

53 Cal.4th 170 (2011)... . ccc cece eee een tere nents 15
Kashmiri v. Regents of the University of California,

156 Cal.App.4th 809 (2007) 06... cect ee eee treet ete te tree tenes passim
Knapp v. AT&T Wireless Services,

195 Cal.App.4th 932 (2011)... ccc eect eee eee tree ene 19
Kowal v. Day,

20 CalApp.3d 720 (1971) oe ee cece cece eee eee eee eee ne eee eee eee es i
Inre Marriage of Herr, .

174 Cal. App.4th 1463 (2009) 20... cee etter nnn 6
New York Times Co. v. Superior Court,

135 Cal App.4th 206 (2005)... 0. ce cee cece eee eee ee neers ener et rer ee eens 7
Parsons v. Bristol Dev. Co.,

62 Cal.2d 861 (1965) 20.00 t een tne es 15
Sav-on Drug Stores, Inc. v. Superior Court,

34 Cal.4th 319 (2004) oo... cette etter teen tes 6
Steiner v. Thexton,

48 Cal.4th 411 (2010)... 0. cece ee tere renee 1

Plaintiffs’ Memorandum in Opposition to Motion for DecertificationWeinstat v. Dentsply Int'l, Inc.,
180 Cal.App.4th 1213 (2010) 20.6... eee cece eee teen eters 2,

Zumbrun v. Univ. of S. Cal.,
25 Cal App.3d 1 (1972) 0.0. 0e cece eens eee ee rece tee ee ete eer eee errr ene ey

FEDERAL CASES

Wal-Mart v. Dukes,
US. _, 131 8. Ct. 2541 2011)... ener 2.

STATUTES AND REGULATIONS
Civil Code §1605 00... eee eect eter eter ener e trees
Code Civ. Proc. §1008 26... c eect tee nee ett eter eee reese terete
5 Cal. Code Reg. §40401 000.2. cece cee etter enters
5 Cal. Code Reg. §41300 00... eee eet tteeneetnt tenner ene nttee

iii
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationwe Ow Nn aD

INTRODUCTION

Plaintiff students bring this lawsuit against Defendant Board of Trustees of the California
State University (“CSU” or “University”) because of its decision to require CSU students to pay
increased and new fees for Fall 2009 even though hundreds of thousands of students had already
been charged or required to pay a specific amount of fees for Fall 2009. This Court’s January 5,
2011 decision certifying this case as a class action recognized, correctly, that common issues
predominate with respect to Plaintiffs’ claims and that this Court is well-equipped to manage the
legal and factual issues raised by the University’s factual defenses — which apply at most to groups
of students, and are not individualized issues. The approximately 175,000 class members have
received class notice. CSU now asks this Court to reconsider its January 5, 2011 certification
decision. None of the reasons CSU provides in its Motion for Decertification warrants
reconsideration of the Court’s conclusion that this case should proceed as a class action.

First, CSU contends that the case has become more complicated (and therefore
unmanageable as a class action) because Plaintiffs have somehow “retreated” from their theory of
contract formation, which is that the student-university contract forms when a student accepts the
offer of admission, as the Court of Appeal held in Kashmiri v. Regents of the University of
California, 156 Cal.App.4th 809 (2007). Def. Mem. at 4:15. CSU mischaracterizes Plaintiffs’ legal
contentions. Plaintiffs have always contended, and continue to contend, that the contract between
CSU and its students forms at admission because that conclusion is inescapable under the facts of
this case and contract law. There is no basis for the Court to reconsider its conclusion that the
common issues raised with respect to contract formation predominate over any individualized
issues. Plaintiffs’ alternative theories with respect to contract formation need not ever be raised if
Plaintiffs prove, through common evidence and under applicable law, that the contract formed at
admission, Even if the Court were to consider one of Plaintiffs’ alternative theories of when the
student-university contract formed, contract formation would still be proven through common,
manageable evidence.

Second, CSU contends that this Court should reconsider its conclusion that the case is

manageable as a class action because CSU has now analyzed information that its own records

1
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationoo tN DH HW RW NY

wow we NR RY NY NY KR KY ef SF Fe Fe ee Se Se eo 8
So a a AW ko NO SF SS Cwm IY DH FE WY YF

contained all along regarding when class members first enrolled, and has discovered facts that it
believes bear on this Court’s certification under Plaintiffs’ original theory. Def. Mem. at 1:11,
5:16-7:11, 11:8-18. These arguments regarding manageability all hinge on facts that CSU has
retrieved from its own records, and the University has always possessed all of this information,
including at the time of the class certification briefing and decision. Motions for decertification
based on “newly packaged, but not newly discovered, evidence” in a defendant’s possession are
procedurally improper and should be denied. Weinstat v. Dentsply Int’l, Inc., 180 Cal_App.4th 1213,
1225 (2010) (concluding trial court erred in decertifying class); see also Green v. Obledo, 29 Cal.3d
126, 148 (1981) (“Before judgment, a class should be decertified only where it is clear there exist
changed circumstances making continued class action treatment improper.”) (internal quotation
marks omitted).

Moreover, although couched in terms of commonality, CSU’s arguments raise no
individualized issues, and are really arguments about manageability and superiority of the class
action mechanism as compared to approximately 175,000 individual actions. CSU is wrong that
issues of proof are unmanageable just because class members who were continuing students as of
Fall 2009 accepted admission to a CSU degree program over a range of prior years (as did the class
members in Kashmiri). Plaintiffs will be able to demonstrate through common proof that the
relevant contract terms that apply to all class members did not change over time — and, therefore,
contrary to CSU’s arguments, the Court will not need to examine every document provided to
students at the time of admission. CSU's renewed attempt to convince this Court that whether the
University formed contracts with its students, and what those contracts say about fees — fees that the
University itself, not the campuses, centrally establishes — varies by campus and according to which
documents each student actually saw is as unavailing now as it was during the class certification
briefing. 1/5/2011 Order at 9:4-12:15.

Finally, CSU suggests that several cases — including the United States Supreme Court’s
opinion in Wal-Mart v. Dukes, _ U.S. __, 131 S.Ct. 2541 (2011), a decision about subjective

decision-making and discrimination in hiring and promotions — have somehow changed California

2

Plaintiffs’ Memorandum in Opposition to Motion for Decertificationclass certification law. Def. Mem. at 2:16-4:12. These cases do not modify the standard this Court
applied to certify this case.
BACKGROUND
A. The Court Certified The Class Based On Facts That Have Not Changed
This Court granted Plaintiffs” motion for class certification on January 5, 2011. In so doing,
the Court concluded that the following facts, which continue to be relevant to CSU’s Motion for
Decertification, were demonstrated by substantial evidence in the record on class certification:

Students at CSU paid certain mandatory registration fees for their education, in
addition to campus-specific fees. For the Fall 2009 term, these university-wide mandatory
fees included: (a) the State University Fee paid by every CSU students, (b) the Non-Resident
Tuition paid by students who did not qualify for California resident status, and (c) the
Graduate Business Professional Fee charged for the first time to graduate business students
in certain programs. The Board of Trustees of CSU set the amounts of these mandatory fees
for all campuses within the CSU system, and the annual fee amounts were uniform across all
twenty-three campuses.

As of Fall 2009, CSU and its campuses communicated with students about fees
primarily through electronic means. Each CSU student was given an electronic student
account, accessible through a password-protected portal on his or her campus website. This
online student account displayed the record of each student’s financial relationship with the
University, including all fee and tuition charges imposed by the University and all payments
made by the student. Students were also able to register for classes, view their class
schedules and grades, and pay their fees through automated on-line systems made available
through CSU websites. Additionally, information regarding mandatory fee amounts was
available on CSU’s “Student Fees” webpage, which was accessible by a link on the
homepage of the CSU website. This webpage stated that “‘the list [of mandatory fees] for the
most current year may change, but is deemed reliable as of the posting date of this
information.”

Students began registering for the Fall 2009 term at CSU campuses during the
previous Spring 2009 term. Students at most campuses were charged registration fees
through their individual online student accounts and given a payment deadline for those fees.
Some students were billed for Fal! 2009 as early as April 2009. On May 13, 2009, the CSU
Board of Trustees voted to enact a ten-percent increase in the State University Fee paid by all
CSU students for the Fall 2009 term. Students who had already been charged for the Fall
term were eventually charged an additional amount as a result of the May increase.

At that same May 2009 Board meeting, CSU created a new Graduate Business
Professional Fee that was to be charged to students in certain graduate business programs for
Fall 2009. However, most campuses did not begin charging students this new fee until after
charging them other standard registration fees. This new fee added approximately $2,000 to
the cost of the term for a full-time graduate business student.

On July 21, 2009, the CSU Board of Trustees voted to impose two additional fee
increases, one being an across-the-board, twenty-percent increase in the State University Fee,
and the other being an increase in Non-Resident Tuition. By that date, many students at
CSU had already been charged and paid a specific fee for the Fall 2009 term, and at some
campuses payment deadlines had already passed. Eventually all CSU campuses charged
their students the additional amounts of the July 21 increase in the State University Fee and

3
Plaintiffs’ Memorandum in Opposition to Motion for DecertificationNon-Resident Tuition, even if students had already been charged or paid their fees for Fall
2009.

During the spring and summer of 2009, different types of information regarding

CSU’s budget situation and the possibility of fee changes were communicated to CSU

students. For example, a few campuses, including CSU Channel Islands and CSU Los

Angeles, sent emails to all of their students regarding the state of the budget and the

possibility of fee increases. Other campuses only sent such emails to certain groups of

students, such as student employees or student leaders. Some campuses posted notices on
their website stating that fees were subject to change without notice. Similar disclaimers
were provided to students at some campuses who received financial aid or signed up for
installment payment plans. Additionally, some students attended meetings where budget
issues and possible fee increases were discussed.

1/5/2011 Order at 1:14-3:7. CSU’s motion does not contest these facts.'

This Court concluded that Plaintiffs had established by substantial evidence all the factors
required for class certification with respect to the issues of contract formation, interpretation, and
breach: ascertainability of the class; a well-defined community of interest, including that common
questions of law and fact predominate over individual questions, the class representatives’ claims
are typical, and those representatives adequately represent the class; and the superiority of the class
action mechanism over individual lawsuits. /d. at 5:13-16:15.

The Court certified the two subclasses Plaintiffs sought. Id. at 16:17-18. By Order of March
15, 2011, the Court, by agreement of the parties, amended the definition of one of the subclasses.

B. Plaintiffs’ Theory Of Contract Formation Has Not Changed

Plaintiffs’ theory of contract formation and breach — which relies on undisputed facts and is
consistent with the holding of Kashmiri and the contract law on which it is based — has not changed.
Plaintiffs maintain that the student-university contract forms when a student accepts the University’s
offer of admission. E.g., 1/5/2011 Order at 6:16-18; Plaintiffs’ Response to CSU Interrogatory No.
15 at 12:7-8 (attached to February 9, 2012 Declaration of Jonathan Weissglass as Exhibit A). That
contract lasts for the duration of a student’s enrollment. One of the terms of the contract that forms

between CSU and its students at admission is that CSU generally reserved the right to establish a

price for each academic term. Plaintiffs contend that when CSU charged or required students to pay

' Plaintiffs incorporate by reference the entire record that was before this Court with respect
to Plaintiffs’ Motion for Class Certification, including CSU’s evidence. That record continues to
support class certification.

4

| Plaintiffs’ Memorandum in Opposition to Motion for Decertificationown A WF YN

bom NY NY KR NN KR | SCE Fe eF ee Se st Ss
SB UV AD BF BH =F SD we DDH FF YN FF S&S

we

a specific price for the Fal! 2009 term, the University established an unambiguous and binding price
term, that specific price term trumps any general reservation of rights, and CSU could not thereafter
raise those students’ fees without breaching their contracts.

In a supplemental discovery response, at CSU’s request, Plaintiffs listed all the alternative
theories that they could possibly conceive of advancing should a court ever disagree with their
primary theory that the student-university contract forms at admission:

Should a court disagree with Plaintiffs’ contention that the student-university contract

formed upon each student's acceptance of the University’s offer of admission, hold that

additional consideration provided at some point after the exchange of offer and acceptance
is insufficient consideration for the student-university contract, or hold that the duration of
the contract at issue is less than the entire duration of the student’s enrollment at the

University, Plaintiffs reserve the right to argue in the alternative, based on the facts alleged in

Plaintiffs’ complaint and exchanged in discovery, that the offer to enter into a contract for

educational services for the Fall 2009 term was made by class members when they registered

for classes for the Fall 2009 term, or, at Los Angeles and San Diego, when class members

paid registration fees prior to registering for classes.
Declaration of Sonali Maitra, filed Jan. 5, 2012, Ex. 2 at 7:21-8:2 (emphasis added). Plaintiffs
provided similar alternative theories — reserved in the event a court rejects Plaintiffs’ contentions —
for questions regarding offer, acceptance, and the date on which the contract formed. Id. at 7:21-
8:2, 10:16-28, 11:25-12:9. Generally speaking, the alternative theories for formation recognized
that a contract governing student’s enrollment at CSU, if held not to have formed by the students’
acceptance of admission, would form soon thereafter, when students took steps such as registering
for classes or paying fees. fd.

This supplemental discovery response is the purported basis for CSU’s argument that
Plaintiffs have “retreated” from the theory that the contract formed at admission. Def. Mem. at
4:15. But Plaintiffs’ discovery response shows that Plaintiffs have in no way retreated from the
claim — which is grounded in the facts of this case and in Kashmiri and the contract law upon which
it rests, and is consistent with the law of states all over the country — that the student-university
contract forms when students accept the University’s offer of admission. Plaintiffs have merely

identified alternative arguments that need not ever be reached, and even if they were, could be

resolved on the basis of common evidence.

5
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationoo Om ND OH BK

DISCUSSION
L Because The Motion For Decertification Is Based On “Newly Packaged” Evidence That

Was Always Available, It Is Procedurally Improper

Trial courts enjoy broad discretion to consider whether cases should proceed as class actions,
because they are uniquely positioned “to evaluate the efficiencies and practicality of group action.”
Weinstat, 180 Cal.App.4th at 1225. This generally includes the authority to decertify a class action
previously certified, under appropriate circumstances. Jd. at 1226.

Decertification is not proper unless “it is clear there exist changed circumstances making
continued class action treatment improper.” Green, 29 Cal.3d at 148. The First District Court of
Appeal recently reaffirmed that decertification motions are procedurally improper if not based on
new evidence or law. Weinstat, 180 Cal.App.4th at 1225-27. The Court of Appeal held that the trial
court erred by granting decertification based on “newly packaged, but not newly discovered,
evidence.” Id. at 1225. This rule properly balances the courts’ need for flexibility with
“prevent[ing] abuse on the part of the defendant.” Jd. at 1226; see also Green, 29 Cal.3d at 148.
This rule is also consistent with the standard for reconsideration pursuant to Code of Civil Procedure
§1008, under which the moving party must demonstrate the existence of new facts or law, and “facts
of which the party seeking reconsideration was aware at the time of the original ruling are not ‘new
or different.”” In re Marriage of Herr, 174 Cal.App.4th 1463, 1468 (2009); see also Garcia v.
Hejmadi, 58 Cal.App.4th 674, 689-90 (1997) (motion for reconsideration improperly granted where
evidence reflected knowledge party had from outset of litigation).

CSU has attempted to package this motion as based on the “changed circumstances” of
Plaintiffs’ naming in response to contention interrogatories some alternative theories of contract
formation in the event that a court ever rejects Plaintiffs’ primary theory that contracts form at
admission. Plaintiffs’ theory of this case has not changed. See supra at 4:17-5:27. That CSU
wishes to raise factual defenses in the event that Plaintiffs raise the alternative theories is no basis to
reconsider the propriety of certifying Plaintiffs’ theory of liability. See Sav-on Drug Stores, Inc. v.
Superior Court, 34 Cal.4th 319, 327 (2004). Moreover, as discussed below in Part III, CSU’s

6

Plaintiffs’ Memorandum in Opposition to Motion for DecertificationoD om NUN DW

we 2

attempt to show that the /aw has changed by citing cases that simply state the standard for
predominance that this Court applied in granting class certification should be rejected.

That leaves the actual basis for CSU’s motion: it has reviewed its own records, which were
available at the time of class certification, and “repackaged” evidence in its possession to argue for
reconsideration of the Court’s conclusion that Plaintiffs’ theories of contract formation and contract
interpretation are manageable. See Def. Mem. at 1:11, 5:16-7 :11, 11:8-18. The “evidence” CSU
submitted with respect to the years that students falling within the class definition were admitted
could have been submitted in opposition to Plaintiffs’ motion for class certification, which was
based on the theory that the contract forms at admission. The First District Court of Appeal has held
that defendants should not get a second bite at the apple, and that it is reversible error to grant
decertification without newly discovered evidence. Weinstat, 180 Cal.App.4th at 1225-27. CSU’s
motion is procedurally improper and should be denied?

IL. This Court Correctly Concluded In The Class Certification Decision That It Is Capable
Of Managing The Legal And Factual Issues Raised By Plaintiffs’ Claims

A. Formation Of Class Members’ Contracts With CSU Will Be Proven Through
Common Evidence

CSU asks this Court to reconsider its conclusion that common legal and factual issues
predominate over individualized issues with respect to the formation of the contracts at issue in this
case, based on its belated realization from information in CSU’s records that the students who fall
within the class definition were admitted to the University over a range of years prior to and
including Fall 2009. See Def. Mem. at 5:16-7:11. CSU contends that the facts relevant to contract
formation differ by campus and within some campuses and by year, and that the Court should
decertify the class because trial on contract formation issues requires examining as a factual matter

how and when class members accepted the University’s offers of admission over this range of years,

2 Under C.C.P. §1008, the party seeking reconsideration “must provide a satisfactory
explanation for the failure to produce the evidence at an earlier time.” New York Times Co. v.
Superior Court, 135 Cal.App.4th 206, 212 (2005). There is absolutely no reason why CSU could
not have looked through its records at the time of the class certification motion and brought to the
Court’s attention the facts it contends are relevant to class members’ years of admission and the
documents provided to those students at that time.

7
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationand “would be a mess.” Id. at 7:7. Relying on Guz v. Bechtel Nat'l, 24 Cal.4th 317 (2000), cSU
also contends: “Under Guz no evidence may be excluded simply because it was not communicated
to all class members, either at formation or thereafter.” Def. Mem. at 10:8-9 (emphasis omitted).

This Court has already rejected the argument that the “individualized contract formation
issues identified by CSU are relevant for purposes of determining whether a contractual relationship
existed between CSU and its students.” 1/5/11 Order at 9:16-18. Likewise, “the Court is also not
persuaded that evidence regarding each student’s knowledge of information that was not
communicated by CSU to the students as a group is relevant on the merits.” 7d, at 12:7-9. The
addition of more irrelevant factual detail with respect to how and when students were first admitted
does not alter these conclusions. Plaintiffs will prove the elements of contract formation by using
common evidence as follows:

Offer. Every class member, by the class definition and undisputed fact, was a student
enrolled in a degree program at CSU as of Fall 2009. CSU’s offer that resulted in the contract
between the University and all class members was the offer of admission to a degree program at
CSU, which the University made to all class members after they applied for admission to CSU. It
will be undisputed as a factual matter that every class member, regardless of the year they began
their program, applied for admission to CSU and was offered admission by the University.

Acceptance. With respect to acceptance of the University’s offer of admission, as this Court
has recognized, under Kashmiri, “the contract between a student and a university arises when a
student accepts the university’s offer of admission.” 1/5/11 Order at 9:12-13; see also Kashmiri,
156 Cal.App.4th at 830 (“the contract itself was formed when the student accepted the University’s
offer of admission”).

CSU argues that the Court must examine the circumstances under which students accepted
admission — to determine whether and when a contract formed — because the University now
contests as a factual matter whether students at every CSU campus, over the range of years during
which class members began their degree programs, were actually required to accept the University’s
offer of admission in writing. See Def. Mem. at 6:1-7:6. Notably, Kashmiri does not limit the

action that forms the student-university contract to an acceptance in writing (although many CSU

8

Plaintiffs’ Memorandum in Opposition to Motion for Decertificationoe WKN OH BF YW NY

woMwW Be RM YN NKR N Fe Be se Se Be Se ee eS
ou WF A fk Oo HN SF SB we NIN DH BF YW NY FF SD

Noo se

campuses did require students to accept in writing), but instead concluded that acceptance of the
offer of admission can occur by students’ conduct. 156 Cal.App.4th at 829.

Most importantly, CSU’s motion entirely ignores that it already conceded, in binding
discovery responses, that every class member accepted the University’s offer of admission.

Weissglass Dec. Ex. B (emphases added):

Interrogatory No. 29:
If CSU contends that any class member did not accept CSU’s offer of admission,

please explain the basis for this contention.

Response to Interrogatory No. 29:
CSU does not contend that class members did not accept CSU’s offer of admission.

Interrogatory No. 30:
If CSU contends that any class member did not accept CSU’s offer of admission,

please identify the class member to whom this contention applies.

Response to Interrogatory No. 31:
Not applicable.

This concession is consistent with the relevant, undisputed facts. It will be undisputed that
approximately 145,000 of the 175,000 class members were admitted, enrolled, and attended courses
in their degree programs during academic terms prior to Fall 2009. See, e.g., Declaration of Nicole
Louie, filed Jan. 5, 2012, Ex. 1. These class members were all “continuing” students as of Fall 2009
— as opposed to the approximately 30,000 students who were “incoming” and began their degree
programs in Fall 2009. It is the continuing students — who began their degree programs over a range
of years prior to Fall 2009 — to whom CSU’s new arguments regarding the purported difficulty in
proving the differences in admissions procedures over time are addressed. Def. Mem. at 5:16-7:11.

Even without CSU’s concession, it would be undisputed — and subject to common proof —
that every one of these 145,000 continuing students accepted the University’s offer of admission at
some point prior to enrolling in their first academic term, which was before Fall 2009. For purposes

of proving acceptance, it does not matter how these continuing students accepted their offers. All

9
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationthat matters is that these students had formed a contractual relationship with CSU prior to Fall
2009.3

Unlike the continuing class members, the timing of when students who began their degree
programs for the first time in Fall 2009 — the 30,000 incoming students — entered into a contractual
relationship with the University could matter, because the fee increases at issue occurred in May and
July 2009, prior to the start of classes.’ The facts with respect to what each CSU campus required
class members to do to accept the University’s offer of admission for Fall 2009 (for almost all
campuses, by returning a notice of intent to enroll form or paying a nonrefundable enrollment
deposit, as Plaintiffs demonstrated in support of class certification, see Supplemental Declaration of
Jusztina Traum, filed Nov. 12, 2010, 933 & Ex. A) are subject to common proof by campus. This
Court has already determined that common issues predominate over individualized issues with
respect to contract formation on the facts relevant to Fall 2009. 1/5/11 Order at 9:4-20. CSU raises
no new facts or arguments that would challenge that conclusion with respect to incoming students.

Consideration. CSU contends that Plaintiffs “dismiss the importance of such basic contract
formation issues as mutuality.” Def. Mem. at 4:17. That is not true, Plaintiffs do not dismiss the
need to prove contract formation, including mutual assent and consideration; but given the
undisputed facts and applicable law, this will be readily accomplished through common proof.

Continuing class members all provided more than sufficient consideration to support their
agreement to attend the University prior to Fall 2009. Every class member who accepted the

University’s offer of admission agreed to confer a benefit on the University by enrolling as a student

3 Much of CSU’s evidence submitted in support of its motion concerns the admissions
procedures at campuses over time. See Declarations of Peg Blake, Jo Volkert, Susan Borrego, Joan
Woosley, William Watkins, and Edward Mills, filed Jan. 6, 2012. CSU contends that each campus
had potentially different practices over time for how students came to attend CSU after being
offered admission — some required students to return acceptance cards, some required enrollment
deposits, and, CSU contends, some campuses historically did not require students to take any steps
other than paying registration fees and enrolling in classes. Any factual differences in those past
practices are irrelevant in light of CSU's concession and the undisputed facts that demonstrate that
all continuing students took action prior to Fall 2009 to accept CSU’s offer of admission.

4 The class definition already excludes incoming students who accepted admission for Fall
2009 afer the implementation of the fee increases, because those students would never have been
charged the “original” fee amount for Fall 2009.

10

Plaintiffs’ Memorandum in Opposition to Motion for DecertificationoOo me KN OH

mer Sw

ina particular degree program, and also agreed to suffer prejudice, including forgoing opportunities
elsewhere and payment of required fees. This exchange of promises by itself constitutes
consideration. Civil Code §1605; see also Steiner v. Thexton, 48 Cal.4th 411, 420 (2010).
Continuing students had all also taken many steps to perform under this contract prior to Fall 2009,
including but not limited to, registering for classes, foregoing opportunities elsewhere, paying
registration fees, and attending classes. Even if there were any question regarding the consideration
provided in the form of the exchange of promises, which there is not, part performance provides
consideration for a previous promise, even if that promise was fully revocable. See, e.g., Steiner, 48
Cal.4th at 424 (holding that performance cures revocable promise and rejecting defendant’s theory
that adequacy of consideration must be determined at time agreement is entered into); Kowal v. Day,
20 Cal.App.3d 720 (1971); Burgermeister Brewing Corp. v. Bowman, 227 Cal.App.2d 274 (1964).
With respect to incoming students for Fall 2009, as was demonstrated in the evidence
supporting class certification, most campuses required written confirmation of intent to enroll or the
payment of a non-refundable deposit, both of which are more than sufficient consideration under
California law. See Nov. 12, 2010 Traum Supp. Dec. §33 & Ex. A. If CSU chooses to argue that
incoming students’ promises to attend the University were revocable, again, later part performance
can provide consideration to support the contract. Steiner, 48 Cal.4th at 424. It is undisputed (and

subject to common proof) that all class members registered for classes, paid registration fees, and

5 Paced with the University of California’s similar argument that acceptance of admission
was revocable and not supported by consideration, this Court concluded in Kashmiri:

The students’ forbearance of other opportunities, such as attending other colleges or
universities or pursuing employment, constituted adequate consideration to enforce the
contract promise. The students’ enro!lment in classes and payment of the established
professional degree fee billed by the University constituted additional consideration for the
bargain. Some students, including MBA students, were required to pay a nonrefundable
admission fee, providing further consideration. The students performed their obligations
under the contract by enrolling and by paying the amount of the professional degree fee
established and billed by the University. [citations omitted].

March 2, 2006 Statement of Decision Granting Plaintiffs’ Mot. for Summ. J. at 11 (Weissglass Dec.
Ex. C).

Wl

Plaintiffs’ Memorandum in Opposition to Motion for Decertificationeventually attended class.* Moreover, any argument by CSU regarding lack of consideration for
incoming students would apply at best to groups of students at particular campuses, and as this
Court has previously concluded, the Court is more than adequately equipped to resolve the issues
raised by CSU's defenses. 1/5/11 Order at 9:4-20.

Finally, to the extent CSU insists on contending that it did not form contracts with its
students at all, that argument is contrary to law. See Kashmiri, 156 Cal.App.4th at 823-24 (“[t]here
seems to be almost no dissent from the proposition that the relationship between a public
post-secondary educational institution and a student is contractual in nature”) (quotations omitted);
id. (“the basic legal relationship between a student and a private university is contractual in nature”);
Zumbrun v. Univ. of S. Cal., 25 Cal.App.3d 1, 10 (1972), Andersen v, Regents of Univ. of Cal., 22
Cal.App.3d 763, 769 (1972).

For all these reasons, CSU has not provided this Court with any valid reason to disturb its
conclusion that whether class members formed contracts with the University is subject to common
proof.

B. Plaintiffs Will Prove Interpretation And Breach By Common Evidence, And

Any Issues Raised By CSU’s Defenses Are Manageable

CSU also contends that, to resolve Plaintiffs’ breach of contract claims, this Court (or a jury)
must examine every document campuses provided to students at the time they accepted admission
that mentions student fees. According to CSU, that would require examining 46 years worth of

documents, which renders this case unmanageable.” This is not, however, what contract law

5 For example (from Weissglass Dec. Ex. B):

Interrogatory No. 31:
Does CSU contend that any class member did not ever register for classes for Fall

2009 term?

Response to Interrogatory No. 31:
CSU does not contend that class members did not register for classes in Fal] 2009.

7 CSU’s claim that class members formed their contracts over 46 years is exaggerated.
CSU’s policies generally mandate that students who do not, for example, take classes for a
(continued...)

12

Plaintiffs’ Memorandum in Opposition to Motion for Decertificationwv

Cwm I an

requires of Plaintiffs to prove their claims. Plaintiffs will be able to prove the relevant terms using
common proof, as described below.

Plaintiffs will prove that, at all times relevant to this lawsuit, CSU has made available to its
students information regarding student fee policies and current student fee amounts in publicly
available documents, including catalogs and websites. As the Court of Appeal explained in
Kashmiri:

Universities frequently publish numerous catalogues and bulletins, but not all statements in

these publications amount to contractual obligations. “Whether a given section of the

bulletin [or catalogue] becomes part of the contractual obligations between the students and
the university... must depend upon general principles of contract construction.” Thus, the
case law recognizes that, like all obligations imposed pursuant to implied contractual terms,
the contractual obligations imposed by the language in catalogues “center around what is
reasonable.”
156 Cal.App.4th at 829 (citations omitted). Plaintiffs will be able to submit common evidence
demonstrating CSU’s pertinent fee policies that were published to students during the time periods
that class members were admitted to the University (once the actually re/evant range of years has
been properly determined, see supra 0.7).

In particular, CSU does not dispute that it generally reserves the right to raise fees (indeed,
CSU adamantly insists that it reserves the right to raise fees), as otherwise the price advertised when
class members were admitted might have been binding throughout enrollment. See Kashmiri, 156
Cal.App.4th at 831 (“We agree that educational institutions retain the right to raise the fees when

that is specified in their catalogues or other publications as long as the increase is reasonable and

does not violate any duty of good faith and fair dealing.”) Thus, Plaintiffs will demonstrate, through

7(...continued)
designated number of academic terms, or perform adequately academically, will no longer be
enrolled in a degree program at the University. See, e.g., 5 Cal. Code Reg. §§40401, 41300. By
CSU’s own admission, the chart of class member start-years — from which it derives the claim that
this Court must review 46 years’ worth of materials — includes students who enrolled in a degree
program many years ago, withdrew or were dis-enrolled, and re-enrolled in a degree program at a
later date. See Def, Mem. at 11:19-20 & n.14. But the contract relevant to this case was created
when those students began their most recent degree program, during which they attended classes
during Fall 2009. Because the chart includes the first term of any prior enrollment for class
members even where class members dis-enrolled and later re-enrolled and only then formed the
contact pertinent to the Fall 2009 term at issue, CSU’s claim that a 46-year timespan is relevant to
this case is overstated.

13
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationcoo em NK WF WY

common evidence of CSU fee policies and publications available at all relevant times, that CSU
students would have reasonably understood that one term of their contract with CSU is that the
University reserved the right to establish or raise fees for each academic term. The question in this
case, as it was in Kashmiri, is when CSU established a binding price term for Fall 2009.

The answer is that CSU established a binding price when it charged class members a specific
price through their online student accounts after they registered for classes for Fall 2009 (or at three
campuses, when CSU required students to pay a specific price to register, prior to any charges
appearing on the student account record). Plaintiffs will prove that all class members were charged
a specific, binding price for Fall 2009, through common evidence including records of the Board of
Trustees’ actions; CSU’s Student Fees website; the facts set forth in the parties’ prior fact
stipulation, filed September 20, 2010 (including that only the Board of Trustees has the authority to
establish or alter fee amounts and policy with respect to the fees at issue in this case); and class
members’ student account data from Fall 2009.* At that time, the price charged for Fall 2009
became an unambiguous, enforceable contract term.

The Court’s role will be to determine the meaning of this price term in light of CSU’s
general disclaimers, applying standard maxims of contract interpretation. Kashmiri, 156
Cal.App.4th at 843. Applying the same maxims of interpretation to facts that are the same in every
material way as the facts in Kashmiri, Plaintiffs believe this Court will reach the same conclusion as
the Kashmiri court:

We agree with the Gamble court that students receiving a bill have a reasonable expectation

that the sum charged will not change unless the bill is accompanied by an advisement that

the sum stated in the bill may still change. The University’s statements on its website and
catalogues alerted students to the fact that posted fees could change without notice.

However, it was reasonable for the student to expect that once he or she received an actual

bill for a specific amount to be paid by a particular date, and that bill did not indicate there

could be any further change, the University had established the actual fee as reflected by the

Id. at 844?

® Plaintiffs previously explained this at class certification, and the relevant facts are set forth
in that record. See Plfs’ Mem. in Support of Class Certification, filed Sept. 20, 2010, at 5-21, 22-26.

9 CSU has repeatedly asserted that the Court should distinguish Kashmiri because the facts
(continued...)

14

Plaintiffs’ Memorandum in Opposition to Motion for DecertificationCo we ND HW FB WwW HY

wom RW NY NN N KR Se Se Se See ee ee Ss
Se SU A ew FO NN fF SF OD wDw IY DH FY NY =F SF

CSU will undoubtedly challenge Plaintiffs’ conclusions based on legal arguments (which
raise common legal issues) as well as submit factual evidence to dispute Plaintiffs’ contentions. The
question raised by CSU’s motion is whether this Court is equipped to manage the legal and factual
defenses CSU wishes to raise. Nothing CSU has provided in its motion raises any doubt as to this
Court’s ability to manage these issues, which all apply at best to groups of students.

First, with respect to the terms of the contract at admission, given Plaintiffs’ common proof,
there will be no need to submit cumulative evidence from all campuses containing language that is
consistent with CSU’s general fee disclaimer language. To the extent that CSU is arguing this Court
must admit into evidence every statement at every campus during every year that contains any
general disclaimer language ~ even if that language is consistent with a policy Plaintiffs have proven
through common proof and CSU does not dispute — that argument is incorrect." This Court may
exclude irrelevant or unnecessarily cumulative evidence. To interpret what a reasonable student
would have understood CSU’s fee policies to be, the Court is not required to admit into evidence
every document ever published by a CSU campus that contains or restates those policies, CSU cites

Guz for this proposition (Def. Mem. at 10:4-9), but Guz — which dealt with the very different issue

%(...continued)

in that case were “stipulated,” as if that somehow implies that the record was problematic or limited.
See, e.g, Def. Mem. at 10:22-24. The parties in Kashmiri stipulated to an extensive factual record
because the facts were not reasonably subject to dispute. That record was in no way truncated
because the parties agreed that the facts were undisputed. Weissglass Dec. {7 (fact stipulations in
Kashmiri encompass more than 30 pages of facts and more than 40 pages of exhibits). Moreover,
the University of California also submitted more than 300 pages of additional evidence that it
contended was relevant beyond what was contained in the fact stipulations. Id. Whether or not
CSU agrees to stipulate — as it should — to what will almost certainly be the undisputed factual
record of the statements and actions CSU and its campuses made and took in this case, CSU will not
be able to avoid the similarities between the factual records in the two cases — and the legal
conclusions that will apply to those facts.

CSU cites Harris v. Superior Court, 53 Cal.4th 170 (2011) (Def. Mem. at 10:24-25), a
wholly inapposite case, apparently based on its mere mention of a fact stipulation in distinguishing
the facts of a prior case. Harris has nothing to do with the issues in this motion or case.

© As this Court recognized in its class certification order, the interpretation standard is an
objective one. 1/5/11 Order at 10:6-12:6; see also Kashmiri, 156 Cal.App.4th at 838, 841-48. The
question of what a reasonable student would have expected the University to intend with respect to
fees is an issue for the Court, not a jury. Parsons v. Bristol Dev. Co., 62 Cal.2d 861, 866 (1965);
Ben-Zvi v. Edmar Co., 40 Cal.App.4th 468, 472 (1995).

15
Plaintiffs’ Memorandum in Opposition to Motion for Decertificationof what evidence a court would consider to find an implied-for-cause contract term that would
overcome an express written at-will employment provision in an employee handbook — did not in
any way hold that a court must admit into evidence unnecessarily cumulative evidence, with no
relevant distinctions, to interpret a contract. 24 Cal.4th at 337-38.

If, on the other hand, CSU wishes to argue in response to Plaintiffs” proof that certain
campuses employed disclaimer language at the time that some class members were admitted that is
somehow stronger or more protective of CSU’s rights than the fee policy established by CSU’s
Board of Trustees or Chancellor at that time, then it may introduce that evidence to attempt to prove
its preferred interpretation of the contract terms. That argument raises an initial common question,
however, that CSU’s motion ignores, which is whether it is reasonable for a CSU student to rely on
the administration’s fee policy or whether campus statements different from that policy can alter
contract terms. Even if the Court were to rule that campuses could alter CSU’s contract terms with
its students by way of statements different from central fee policy, any such campus-level defenses,
based on the language of any documents CSU contends contained a stronger disclaimer than CSU’s
general policy, are easily managed. Notably, CSU has submitted only Avo disclaimers it contends
are stronger than its general “fees are subject to change” disclaimers (from certain years at
Sacramento and Northridge). Def. Mem. at 8:15-26, 11:22-12:10."" This evidence, affecting a

defined subset of class members at two campuses, does not render this case unmanageable.

| CSU's evidence describes disclaimers employed by Sacramento at the point in time
students paid for courses, and Northridge when students purchased a class schedule. Def. Mem. at
8:15-26, 11:22-12:10. None of this evidence bears on the terms that existed under Plaintiffs’
primary theory of formation at admission; instead, the evidence applies to potential alternative
theories of formation at time of payment or registration, respectively. For the reasons explained
above, it is likely that the Court will never need to consider these alternative theories. Even if some
other point in time (such as registration or payment) were relevant to contract formation, again, the
Court need not admit every piece of unnecessarily cumulative evidence regarding CSU’s general
disclaimers. And, CSU has provided the Court with no record evidence of any disclaimer language
that it contends is different or stronger than its general disclaimers, at any of the purported 184
moments in time (Def. Mem. at 11:21), other than the two from Sacramento and Northridge. The
issues raised by any more specific disclaimer language CSU contends some campus employed at
one of these later points in time are easily m