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Chesbro v. Best Buy Stores, Lp

United States District Court, W.D. Washington, Seattle

May 7, 2014

MICHAEL CHESBRO, Plaintiff,
v.
BEST BUY STORES, L.P., Defendant.

ORDER

RICHARD A. JONES, District Judge.

I. INTRODUCTION

This matter comes before the court on Plaintiff Michael Chesbro's second unopposed motion for preliminary approval of proposed class action settlement. Dkt. # 92. No party has requested oral argument, and the court finds oral argument unnecessary. For the reasons stated below, the court GRANTS the motion for preliminary approval of class action settlement.

II. BACKGROUND

Best Buy Stores, L.P. ("Best Buy"), a national retailer of consumer electronics and related products, has a customer loyalty program called the Reward Zone Program. As part of the Reward Zone enrollment process, customers provide Best Buy with their contact information. Mr. Chesbro alleges that when consumers financed their purchases through an installment plan, they were signed up for the Reward Zone, and that Best Buy then used the contact information provided to contact customers through direct mail, email or telephone.

Mr. Chesbro alleges that beginning in the fall of 2007, Best Buy, through its calling vendor, began calling members to remind them to use their Reward Zone certificates before they expired. In the summer and fall of 2009, Best Buy introduced a "Go Digital" program to shift the issuance of Reward Zone certificates to online issuance through e-mail. Implementation of the Go Digital program involved notifying consumers of the new procedures, which Best Buy did by placing automated calls to customers. The certificate reminder and Go Digital programs lasted through November 2011.

On April 5, 2010, Mr. Chesbro filed a class action complaint in King County Superior Court, which was removed to this court. Mr. Chesbro alleges that Best Buy violated the Washington Automatic Dialing and Announcing Statute ("ADAD Statute"), RCW 80.36.400, the Washington Consumer Protection Act ("CPA"), RCW 19.86 et seq., and the federal Do-Not-Call regulations, 47 C.F.R. § 64.1200 et seq. The Do-Not-Call regulations are regulations promulgated under the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227(b), [1] and an action brought for violation of the regulations may recover actual monetary loss or receive up to $500 in damages for each violation, whichever is greater, 47 U.S.C. § 227(b)(3)(B).

On September 16, 2011, the court granted summary judgment to defendant. Dkt. # 61. On December 27, 2012, the Ninth Circuit reversed and remanded the court's order on summary judgment. Dkt. # 70. Beginning on April 3, 2013, the court granted the parties' stipulated motions to stay to provide sufficient time for the parties to mediate and negotiate a settlement. Dkt. ## 77, 79, 81. On December 6, 2013, plaintiff filed his first motion for preliminary approval. Dkt. # 87. In the order denying preliminary approval, the court expressed several concerns: (1) the court lacked sufficient information to determine whether the factual and legal questions arising from Best Buy's classwide practices of autodialing customers predominate over individual issues; and (2) the court lacked sufficient information to determine whether the settlement was fair, reasonable, and adequate. Dkt. # 91 at 5-7. With respect to the latter, plaintiff (1) had not indicated how much each class member could gain by going to trial, (2) had not explained how he reached the $50 to $100 per call estimate, (3) had not provided evidence documenting the estimated administrative costs associated with settlement, and (4) had not addressed the normal range of participation in class action settlements. Id. The court also noted that the class notice currently did not provide a mechanism or instruction on how a class member could review the motion for attorney's fees. Id. at 7 n.4.

III. ANALYSIS

A. Motion for Preliminary Approval of Class Settlement

The parties' agreement to settle this matter is not itself a sufficient basis for approving the settlement. The settlement would require the court to certify a class and dispose of the claims of its members. The court has an independent obligation to protect class members. Silber v. Mabon, 957 F.2d 697, 701 (9th Cir. 1992). Even for a class certified solely for purposes of settlement, the court must ensure that the class and its proposed representatives meet the requirements of Federal Rule of Civil Procedure 23 ("Rule 23"). Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 2003). In addition, the court must ensure that the settlement is "fair, reasonable, and adequate." Fed.R.Civ.P. 23(e)(2).

Mr. Chesbro proposes that the court certify a national class and Washington class defined as follows:

National Class. All United States residents except for those with Washington State area codes who, between October 8, 2007 and November 30, 2011, received a telephone call from or on behalf of Best Buy regarding Best Buy's Rewards Zone go digital policy, after they had asked Best Buy not to be called; and
Washington Class. All persons who had Washington State area codes and who, between October 8, 2007 and November 30, 2011, received a telephone call from or on behalf of Best Buy regarding Best Buy's Rewards Zone certificate reminders or go digital policy that had been placed using an automated dialer and an artificial or pre-recorded voice.

Dkt. # 89 at 15 (Ex. 1 to Terrell Decl., Settlement Agr. ¶ II.7).

For the reasons stated herein, the court preliminarily approves the parties' settlement agreement. This order concludes with a timeline for notifying class members of the settlement and of class counsel's forthcoming motion for attorney's fees in preparation for a September 19, 2014 final approval hearing.

1. The Four Prerequisites of Rule 23(a): Numerosity, Commonality, Adequacy, and Typicality

The class Mr. Chesbro hopes to certify satisfies the numerosity and commonality requirements of Rule 23(a). There are about 439, 000 members of the Washington class and 42, 000 members of the national class, and there is no question that joinder of that many individual plaintiffs would be impracticable. Fed.R.Civ.P. 23(a)(1). Best Buy allegedly called every class member with an artificial or prerecorded voice after such individuals had asked that they not be called. From these common practices spring numerous common questions of fact and law, including whether the calls made constituted "solicitations" under the relevant statutes. Fed.R.Civ.P. 23(a)(2).

While the numerosity and commonality requirements focus on the class, the typicality and adequacy requirements focus on the class representative. The representative must have "claims or defenses... [that] are typical of the claims or defenses of the class, " and must "fairly and adequately protect the interests of the class." Fed.R.Civ.P. 23(a)(3)-(4).

Mr. Chesbro's claims are also typical of class members' claims where he, like every other class member, allegedly received the automated calls without his consent. See Hanlon v. Chrysler Corp., 150 F.3d 1011, 1020 (9th Cir. 1998) (representative's claims are typical "if they are reasonably coextensive with those of absent class members; they need not be substantially identical.").

Questions of a class representative's adequacy dovetail with questions of his counsel's adequacy. Fed.R.Civ.P. 23(g)(4) ("Class counsel must fairly and adequately represent the interests of the class."). The court has no difficulty concluding that counsel has provided and will ...


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