Motion for Decertification in New York

What Is a Motion for Decertification?

How to Structure the Motion

Plaintiffs seeking class certification under Article 9 of the New York CPLR must establish all five requirements of section 901(a)—numerosity, predominance, typicality, adequacy, and superiority—as well as the five factors set forth in CPLR § 902. (See CPLR § 901(a), 902; see also, Alix v. Wal-Mart Stores, Inc., 57 A.D.3d 1044, 1045, 868 N.Y.S.2d 372 [3d Dept. 2008]; Rife v. Barnes Firm, P.C., 48 A.D.3d 1228, 852 N.Y.S.2d 551 [4th Dept. 2008].)

In addition, plaintiffs must establish that the class is capable of being identified by administratively feasible objective criteria, without the need for individualized inquiries. (See, e.g., Mitchell v. Barrios-Paoli, 253 A.D.2d 281, 290, 687 N.Y.S.2d 319, 325 [1st Dept. 1999].)

To meet their burden, plaintiffs must make more than just conclusory allegations; they must support their assertions with specific facts. (See, e.g., Rallis v. City of N.Y., 3 A.D.3d 525, 526, 770 N.Y.S.2d 736, 737 [2d Dep’t 2004].)

The Court’s Decision

While the court does not decide the merits of the case when assessing the propriety of class treatment, the court must look to the merits to the extent necessary to determine whether the requirements for class certification have been met. (See In re Initial Public Offerings Sec. Litig., 471 F.3d 24, 41-42 (2d Cir. 2006); Sternberg v. N.Y. Water Serv. Corp., 155 A.D.2d 658, 659, 548 N.Y.S.2d 247, 248 [2d Dept..1989]; Alix v. Wal-Mart Stores, Inc., 16 Misc. 3d 844, 851 n.5, 838 N.Y.S.2d 885, 891 [2007].)

It is well settled that “[a] decision granting class action status is not immutable and if later events indicate that the decision should be reversed, altered or amended, requisite relief is authorized.” (In re Colt Indus. S’holders Litig., 77 NY2d 185, 196 [1991].) Specifically, decertification of a class is appropriate at any point in time following granting of initial class-certification, until a decision on the merits has been issued. (See CPLR § 902. DeFilippo v. Mutual Life Insurance Company of New York, 13 A.D.3d 178, 181-82 [1st Dept.. 2004] (“[…CPLR 902, which permits an order certifying a class to be altered or amended before a decision on the merits, does not bar decertification of the sole surviving... claim, since there has been no decision on the merits as to that specific claim.”) (quoting CPLR 902).)

Decertification may be warranted for substantive reasons such as lack of numerosity, where there has been a substantive change in the law underlying the claims of the action, or procedural reasons. (See Bloom v. Cunard Line, Ltd., 76 A.D.2d 237, 241, 430 N.Y.S.2d 607, 610 [1980]; DeFilippo, 13 A.D.3d at 181, 787 N.Y.S.2d at 14 (“...defendants' second decertification motion was justified by an intervening change in the law....”); Chimenti v. Am. Express Co., 97 A.D.2d 351, 352, 467 N.Y.S.2d 357, 358 [1st Dept. 1983].)

CPLR § 902 provides that an order certifying a class “may be altered or amended before the decision on the merits on the court’s own motion or on motion of the parties.” (Id. See also DeFilippo, 13 A.D.3d at 182, 787 N.Y.S.2d at 15; Pludeman v. N. Leasing Sys., Inc., 106 A.D.3d 612, 615, 966 N.Y.S.2d 383, 385 (2013)(“Had we determined that decertification was appropriate, we could have ordered it on our own motion.”) (citing CPLR § 902; Small v. Lorillard Tobacco Co., 94 N.Y.2d 43, 52–53, 698 N.Y.S.2d 615, 720 N.E.2d 892 [1999]; CLC/CFI Liquidating Trust v. Bloomingdale's, Inc., 50 A.D.3d 446, 447, 855 N.Y.S.2d 497 [1st Dept.. 2008] ).)

Decertification requires a finding that further class treatment is inappropriate. (See DeFilippo, supra; see also City of New York v. Maul, 14 N.Y.3d 499, 514 [2010]; Colt Industries Shareholder Litigation v. Colt Industries, Inc., 77 N.Y.2d 185, 196 [1991]; Friar v. Vanguard Holding Corp., 78 A.D.2d 83 [2d Dept.. 1980]; Pludeman v. Northern Leasing Systems, Inc., 106 AD3d 612 [1st Dept.. 2013].) This is because a plaintiff and Class Counsel must be able to satisfy all class-certification prerequisites at all times, not just at the time initial certification is sought. (Mazzei v. Money Store, 829 F.3d 260, 270 (2d Cir. 2016) (“In opposing the decertification motion, [plaintiff] retained the burden to demonstrate that [class action] requirements were satisfied”).)

A plaintiff’s failure to establish the requirements set forth in CPLR §§ 901, 902, mandates decertification. (Cardona v. Maramont Corp., 43 Misc. 3d 1230(A), 993 N.Y.S.2d 643, at *8 [Sup. Ct., NY Cty. 2014].) Thus, in reviewing whether certification was appropriate, the court must analyze the satisfaction of the requirements of CPLR § 901 and then the factors set forth in CPLR § 902.

CPLR § 902 further clarifies § 901(a)(5) by identifying factors a certifying court should consider in determining whether a class action is superior to other available methods of adjudication. These include: (1) the interests of members of the class in instituting separate actions, (2) the impracticability or efficiency of prosecuting separate actions, and (3) the extent or nature of any other litigation already commenced by any member of the class regarding the controversy. (Chaine v. Paris Limousine Servs., Corp., 32 Misc. 3d 1227(A), 934 N.Y.S.2d 32 [Sup. Ct., N.Y. Cty. 2011].) CPLR § 902's factors overlap with CPLR § 901(a)(5) and are seen as implicit in the superiority prerequisite. (Id. (citing Gilman v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 93 Misc. 2d 941, 404 N.Y.S.2d 258, 264 (Sup. Ct., N.Y. Cty. 1978).)

In making its decision, an evidentiary hearing as to the merits of class-certification (and decertification) is necessary. (See, e.g., Geiger v. American Tobacco Co., 252 A.D.2d 474, 476 [2d Dept. 1998] (“The record is insufficient to make an informed determination as to all of the prerequisites to certification of a class action. [Accordingly] we find it appropriate to remit the matter for . . . a mini-hearing on the issue of class certification.”); Becker v. Empire of Am. Fed. Sav. Bank, 155 A.D.2d 923 [4th Dept. 1989] (holding order certifying class to be “premature” as it was made without “the benefit of a mini-hearing’”); Chimenti, 97 A.D.2d at 352.(“The primary reason for reversal at this stage is failure of Special Term to develop an evidentiary basis for class certification. Special Term should have held a mini-hearing . . . to determine whether the prerequisites to class certification listed in CPLR 901 are present, and to assess the feasibility considerations listed in CPLR 902 relevant to the particular facts.”).)