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Caulton v. Merchants' Credit Guide Co.

February 22, 2007


The opinion of the court was delivered by: Honorable David H. Coar


Before this Court is Plaintiffs' motion to certify plaintiff class in this Fair Debt Collection Practices Act ("FDCPA") action against defendants, Merchants' Credit Guide Co. ("MCG") and CFB Financial LLC ("CFB").For the reasons set forth below, Plaintiff's motion for class certification is granted under the conditions specified.


Plaintiff claims that MCG and CFB reported erroneous information to the credit bureau TransUnion on the last activity date of a debt incurred by plaintiff for personal, family or household purposes. Plaintiff asserts that MCG and CFB reported that the date of last activity was December 1999, when the correct date was in late 1996; that MCG and CFB reported that the account had been placed for collection only in April 2005, when the correct date was 7 years earlier; and that MCG and CFB listed CFB as the "original creditor," when the correct "original creditor" was Discover. Plaintiff disputed the debt with TransUnion in late 2005. TransUnion conducted an investigation and contacted MCG. MCG maintained that the information it had reported was correct. Plaintiff claims MCG and CFB provided false information in violation of 15 U.S.C. §§1692e, 1692e(2), 1692e(8) and 1692e(10). Plaintiff seeks to represent a class of 5,501 individuals who were subject to similar misreporting by MCG and CFB.


Rule 23 of the Federal Rules of Civil Procedure sets forth the relevant standards for maintaining class action suits in federal court. Under Rule 23(a), a proposed class must satisfy four conditions before a court will grant certification: (1) numerosity; (2) commonality; (3) typicality; and (4) adequacy of representation. Fed. R. Civ. P. 23(a). In addition, the Plaintiff must satisfy Rule 23(b), which offers only three potential bases for a valid class action. See Fed.R.Civ.P. 23(b). In the case before the Court, Plaintiff seeks certification under Rule 23(b)(3), which authorizes class actions where the "questions of law or fact common to the members of the class predominate over any questions affecting individual members, and a class action is superior to other available methods for the fair and efficient adjudication of the controversy." The burden of proof on a motion for class certification rests with the Plaintiff. See Gen. Tel. Co. v. Falcon, 457 U.S. 147, 162, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982).


A. Numerosity

Rule 23(a)(1) requires that the class be "so numerous that joinder of all members is impracticable." Although there is no "magic number" of class members for numerosity purposes, case law indicates that when a class numbers at least 40, joinder will be considered impracticable. Swanson v. Am. Consumer Indus., 415 F.2d 1326, 1333 (7th Cir. 1969). The proposed class has 5, 501 individuals, and there is no objection by defendant as to numerosity. Numerosity is satisfied.

B. Commonality

Under Rule 23(a)(2), there must be a question of law or fact common to the class. Rule 23(b)(3), discussed below, more stringently requires that the common questions of law or fact predominate over questions pertaining to individual class members. Commonality generally exists when the defendant has engaged in "standardized conduct" towards the members of the proposed class. Smith v. Nike Retail Servs., Inc., 234 F.R.D. 648, 2006 WL 715788, at *4 (N.D. Ill. Mar. 22, 2006). "A common nucleus of operative fact is usually enough to satisfy the commonality requirement of Rule 23(a)(2). Rosario v. Livaditis, 963 F.2d 1013, 1017 (7th Cir. 1992). In the present case, the "common nucleus of operative fact" is the alleged inaccurate reporting practice of MCG and CFB to credit bureaus. The reporting is standardized conduct towards all members of the class. The principle legal question is whether such practice violates the FDCPA and ICAA. The Defendant raises no challenge to commonality. Commonality is satisfied.

C. Typicality

A plaintiff's claim is typical of a proposed class if "it arises from the same event or practice or course of conduct that gives rise to the claims of other class members and [is] based on the same legal theory." De La Fuente v. Stokely-Van Camp, Inc., 713 F.2d 225, 232 (7th Cit. 1983). Further, "factual distinctions between the claims of the named class members and those of other class members" do not necessarily defeat a finding of typicality. Id. at 233. The issue instead turns on whether the plaintiff's claims "have the same essential characteristics" as those of the proposed class members. Retired Chicago Police Ass'n v. City of Chicago, 7 F.3d 584, 599 (7th Cir. 1993). ...

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