13‐2742‐cv

Monique Sykes, et al. v. Mel S. Harris & Associates, LLC, et al.

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

____________________

August Term, 2013

(Argued: February 7, 2014                 Decided: February 10, 2015)

Docket Nos. 13‐2742‐cv, 13‐2747‐cv, 13‐2748‐cv

____________________

MONIQUE SYKES, REA VEERABADREN, KELVIN PEREZ, CLIFTON

ARMOOGAM, Individually and on behalf of all others similarly situated,

Plaintiffs‐Appellees,

v.

MEL S. HARRIS AND ASSOCIATES LLC, MEL S. HARRIS, TODD FABACHER,

MICHAEL YOUNG, KERRY LUTZ, ESQ., LR CREDIT 18, LLC, L‐CREDIT, LLC,

LEUCADIA NATIONAL CORPORATION, LR CREDIT, LLC, LR CREDIT 10,

LLC, SAMSERV, INC., WILLIAM MLOTOK, BENJAMIN LAMB, DAVID

WALDMAN, JOSEPH A. ORLANDO, MICHAEL MOSQUERA, JOHN

ANDINO, LR CREDIT 14, LLC, LR CREDIT 21, LLC, PHILIP M. CANNELLA, 

Defendants‐Appellants.

1

____________________

Before: JACOBS, CALABRESI, and POOLER, Circuit Judges.

1 The Clerk of the Court is directed to amend the caption as above.
Defendants Leucadia National Corporation, a company that purchases

consumer debts, Mel S. Harris and Associates, a law firm with a significant debt‐

collection practice, and Samserv, Inc., a process server, appeal from the

September 4, 2012 class certification opinion and March 28, 2013 class

certification order of the United States District Court for the Southern District of

New York (Denny Chin, Circuit Judge).

The district court’s March 28, 2013 order certified two classes. The first

class, pursuant to Rule 23(b)(2) of the Federal Rules of Civil Procedure,

comprised “all persons who have been or will be sued by the Mel Harris

defendants as counsel for the Leucadia defendants . . . assert[ing] claims under

the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C.

§ 1961; New York General Business Law (GBL) § 349; and New York Judiciary

Law § 487.” Special App’x at 46. The second class, certified pursuant to Rule

23(b)(3) of the Federal Rules of Civil Procedure, comprised “all persons who have

been sued by the Mel Harris defendants as counsel for the Leucadia defendants

in . . . New York City Civil Court and where a default judgment has been

obtained. Plaintiffs in the Rule 23(b)(3) class assert claims under RICO; the Fair

2
Debt Collection Practices Act, 15 U.S.C. § 1692; GBL § 349; and New York

Judiciary Law § 487.” Special App’x at 47.

We conclude that the district court did not abuse its discretion in certifying

either class.

Affirmed. Judge Jacobs dissents in a separate opinion.

____________________

PAUL D. CLEMENT, Bancroft PLLC, Washington, DC

(Candice Chiu, Bancroft PLLC, Washington, DC; James R.

Asperger and Maria Ginzburg, Quinn Emanuel Urquhart &

Sullivan LLP, New York, NY; Marc A. Becker, London, UK;

Brett A. Scher, Kaufman Dolowich & Voluck LLP, Woodbury,

NY, on the brief), for Defendants‐Appellants Mel S. Harris LLC,

Mel S. Harris, Michael Young, David Waldman, Kerry Lutz, and

Todd Fabacher.

MIGUEL A. ESTRADA, Gibson, Dunn & Crutcher LLP,

Washington, DC (Scott P. Martin, Gibson, Dunn & Crutcher

LLP, Washington, DC; Michael Zimmerman, Zimmerman

Jones Booher LLC, Salt Lake City, UT; Lewis H. Goldfarb and

Adam R. Schwartz, McElroy, Deutsch, Mulvaney & Carpetner

LLP, Morristown, NJ; Mark D. Harris, Proskauer Rose LLP,

New York, NY, on the brief), for Defendants‐Appellants Leucadia

National Corporation, L‐Credit, LLC, LR Credit, LLC, LR Credit 10,

LLC, LR Credit 14, LLC, LR Credit 18, LLC, LR Credit 21, LLC,

Joseph A. Orlando, and Philip M. Cannella.

JACK BABCHIK, Babchik & Young LLP, White Plains, NY, for

Defendants‐Appellants Samserv, Inc., William Mlotok, Benjamin

Lamb, Michael Mosquera, and John Andino.

3
MATTHEW D. BRINCKERHOFF, Emery Celli Brinckerhoff &

Abady LLP, New York, NY (Jonathan S. Abady, Debra L.

Greenberger and Vasudha Talla, Emery Celli Brinckerhoff &

Abady LLP, New York, NY; Josh Zinner, Susan Shin and

Claudia Wilner, New Economy Project, New York, NY;

Carolyn E. Coffey and Ariana Lindermayer, of counsel to

Jeanette Zelhoff, MFY Legal Services, New York, NY; Charles

J. Ogletree, Jr., Harvard Law School, Boston, MA, on the brief),

for Plaintiffs‐Appellees.

JEAN CONSTANTINE‐DAVIS, AARP Foundation Litigation,

Washington, DC, on behalf of Amici Curiae AARP, National

Association of Consumer Advocates, and National Consumer Law

Center, in support of Plaintiffs‐Appellees.

DANIELLE F. TARANTOLO, New York Legal Assistance

Group, New York, NY, on behalf of Amicus Curiae Consumer

Advocates, in support of Plaintiffs‐Appellees.

SARANG VIJAY DAMLE, Senior Counsel, Consumer

Financial Protection Bureau, Washington, DC (Meredith

Fuchs, General Counsel, To‐Quyen Truong, Deputy General

Counsel, David M. Gossett, Assistant General Counsel, Jessica

Rank Divine, Attorney, Consumer Financial Protection

Bureau, Washington, DC; Jonathan E. Nuechterlein, General

Counsel, John F. Daly, Deputy General Counsel for Litigation,

Theodore (Jack) Metzler, Attorney, Federal Trade

Commission, Washington, DC, on the brief), on behalf of Amici

Curiae The Consumer Financial Protection Bureau and Federal

Trade Commission, in support of Plaintiffs‐Appellees.

POOLER, Circuit Judge:

These consolidated appeals are taken from the September 4, 2012 class

4
certification opinion, Sykes v. Mel Harris & Assocs., LLC, 285 F.R.D. 279 (S.D.N.Y.

2012) (“Sykes II”), and March 28, 2013 class certification order of the United States

District Court for the Southern District of New York (Denny Chin, Circuit Judge).

Defendants in this case comprise three entities: “(1) various subsidiaries of

Leucadia National Corporation (“Leucadia”) that purchase and collect consumer

debt; (2) Mel S. Harris and Associates LLC (“Mel Harris”), a law firm specializing

in debt collection litigation; [and] (3) Samserv, Inc. (“Samserv”), a process service

company.” Sykes II, 285 F.R.D. at 283. Defendants also include “associates of each

of the foregoing entities,” id., and we respectively refer to them as the Leucadia

defendants, Mel Harris defendants, and Samserv defendants (as did the district

court).

The district court’s March 28, 2013 order certified two classes. The first

class, certified pursuant to Rule 23(b)(2) of the Federal Rules of Civil Procedure,

comprises “all persons who have been or will be sued by the Mel Harris

defendants as counsel for the Leucadia defendants . . . assert[ing] claims under

the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C.

§ 1961; New York General Business Law (GBL) § 349; and New York Judiciary

Law § 487.” Special App’x at 46.

5
The second class, certified pursuant to Rule 23(b)(3) of the Federal Rules of

Civil Procedure, comprised “all persons who have been sued by the Mel Harris

defendants as counsel for the Leucadia defendants in . . . New York City Civil

Court and where a default judgment has been obtained. Plaintiffs in the Rule

23(b)(3) class assert claims under RICO; the Fair Debt Collection Practices Act

[(FDCPA)], 15 U.S.C. § 1692; GBL § 349; and New York Judiciary Law § 487.”

Special App’x at 47.

We conclude that the district court did not abuse its discretion in certifying

either class.

Affirmed.

BACKGROUND

We draw our facts from the district court’s class certification opinion,

which depended on “the depositions, declarations, and exhibits submitted . . . in

connection with” the motion for class certification. Sykes II, 285 F.R.D. at 283. The

district court, as was proper, only resolved “factual disputes to the extent

necessary to decide the class certification issue.” Id. (citing In re Initial Public

Offering Sec. Litig., 471 F.3d 24, 27, 41–42 (2d Cir. 2006). It did not resolve “factual

assertions relate[d] to the merits . . . but state[d] them as the parties’ assertions,”

6
and we will follow that practice. Id. Where we are required to supplement the

background as laid out by the district court by virtue of the arguments of the

parties on appeal, we will also refer to the depositions, declarations, and exhibits

which formed the record before the district court at class certification.    

I. Plaintiffs

“Monique Sykes, Rea Veerabadren, Kelvin Perez, and Clifton Armoogam

are New York City residents who were each sued by various defendants in debt

collection actions commenced in New York City Civil Court between 2006 and

2010.” Sykes II, 285 F.R.D. at 283. Each plaintiff “denies being served with a

summons and complaint in their respective action. . . . Defendants, nevertheless,

were able to obtain default judgments against them.” Id.

II. Defendants’ Alleged Default Judgment Scheme

A. Default Judgments

These default judgments, in the words of plaintiffs, are the result of

defendants’ construction of a “default judgment mill.” The “mill” operates in this

fashion: first, by obtaining charged‐off consumer debt; second, by initiating a

debt‐collection action by serving a summons and complaint on the purported

debtor; and third, by submitting fraudulent documents to the New York City

7
Civil Court in order to obtain a default judgment.

At the first step, “[p]laintiffs allege that the Leucadia and Mel Harris

defendants entered into joint ventures to purchase debt portfolios, and then filed

debt collection actions against the alleged debtors with the intent to collect

millions of dollars through fraudulently‐obtained default judgments.” Id.

At the second step, Mel Harris would employ “a software program . . .

designed by [Mel Harris employee] Mr. [Todd] Fabacher.” Appellees’ App’x at

157. Fabacher is employed as a “director of information technology for Mel

Harris.” Sykes II, 285 F.R.D. at 284. His program “selects and organizes debts for

the generation of a summons and complaint for each debt. These documents are

signed by an attorney, and bundled together in batches of 50. Each batch is sent

to a single process serving company.” Appellees’ App’x at 157. Further, the

process serving company associated with each debt is saved by this computer

program, so “the process serving company associated with any particular debt

can be readily ascertained.” Appellees’ App’x at 157.

To effectuate this second step, Leucadia and Mel Harris defendants would

hire a process server, often Samserv. Sykes II, 285 F.R.D. at 283. Plaintiffs allege

that “Samserv routinely engaged in ‘sewer service’ whereby it would fail to serve

8
the summons and complaint but still submit proof of service to the court.” Id.

This proof of service was first delivered to Mel Harris, which, “[a]fter process

[wa]s allegedly served, . . . receive[d] from the process serving company an

electronic affidavit of service.” Appellees’ App’x at 157. After receiving this

affidavit of service, the system designed by Fabacher “automatically organize[d]

and print[ed] a motion for a default judgment [and] an affidavit of merit . . .

within approximately 35 days after the date of service of process.” Appellees’

App’x at 157–58.

Having generated these documents, at the third step, “[a]fter a debtor

failed to appear in court for lack of notice of the action, the Leucadia and Mel

Harris defendants would then apply for a default judgment by providing the

court with . . . an ‘affidavit of merit’ attesting to their personal knowledge regarding

the defendant’s debt and an affidavit of service as proof of service.” Sykes II, 285

F.R.D. at 283 (emphasis added).

Before the district court at the class certification stage, there was substantial

evidence of the scope and impacts of this alleged scheme. “Between 2006 and

2009, various Leucadia entities filed 124,838 cases,” and Mel Harris represented

Leucadia in 99.63 percent of those cases. Id. at 284. “The ‘vast majority’ of such

9
cases were adjudicated without appearance by the defendant debtors, indicating

the likelihood that a default judgment was entered.” Id. Further, “[b]etween 2007

and 2010 various Leucadia entities obtained default judgments in 49,114 cases in

New York City Civil Court.” Id.

B. Affidavits of Service

The district court concluded that “[b]etween January 2007 and January

2011, Samserv defendants performed service of process in 94,123 cases filed by

Mel Harris in New York City Civil Court, 59,959 of which were filed on behalf of

Leucadia defendants.” Id. In evaluating the evidence submitted by plaintiffs with

respect to Samserv’s practice of engaging in sewer service, the district court

concluded that there was “substantial support for plaintiffs’ assertion that

defendants regularly engaged in sewer service.” Id. This conclusion was based on

the fact that “[r]ecords maintained by defendants reveal hundreds of instances of

the same process server executing service at two or more locations at the same

time,” id., as well as the fact that “[t]here were . . . many other occasions where

multiple services were purportedly made so close in time that it would have been

impossible for the process server to travel from one location to the other as

claimed.” Id.

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Plaintiffs point out that the record before the district court also included a

number of other irregularities. For example, “in 2,915 instances, a process server

claimed to have attempted or completed service before the date that the service

was assigned to that process server—[a] physical impossibility.” Appellees’

App’x at 163. Additionally, process servers often reported 60 service attempts in

a single day, Appellees’ App’x at 183, and the six particular process servers who

accounted for a majority of service performed by Samserv for Mel Harris

“reported high volumes of service, including hundreds of days on which they

claimed to have made more than 40 visits in a single day,” Appellees’ App’x at

165. However, an experienced process server attested to the fact that “based on

[his] experience, . . . it is unlikely that a process server could regularly make more

than 25 service attempts at personal residences in one day.” Appellees’ App’x at

153. Finally, “[t]he six process servers also reported widely divergent rates of

personal, substitute, and nail and mail service.” Appellees’ App’x at 165. There

was no evidence in the record at class certification that would explain the

divergent rates for the means of service. Plaintiffs finally point out that, despite

the district court’s order that Samserv defendants produce logbooks recording

11
their service attempts by October 6, 2009, which could ostensibly confirm service,

none have been turned over.

C. Affidavits of Merit

The district court provided a complete overview of the process for

generating affidavits of merit, the facts of which are not challenged on appeal.

“The affidavits of merit submitted by the Mel Harris and Leucadia defendants . . .

follow a uniform format.” Sykes II, 285 F.R.D. at 284. Fabacher “attests that he is

‘an authorized and designated custodian of records’ for” one of the Leucadia

entities that owns the charged‐off debt, in New York City Civil Court. Id. He

affirms that because he “‘maintain[s] the . . . records and accounts . . . including

records maintained by and obtained from [the collection entity’s] assignor’ . . . he

is ‘thereby fully and personally familiar with, and [has] personal knowledge of, the

facts and proceedings relating to the [debt collection action].’” Id. (first, second,

fourth, and fifth alterations in original) (emphasis added).

The district court explained the crux of the issue as follows:

Typically, Fabacher does not receive the original credit agreements

between the account holders and the creditors. Instead, he receives

a bill of sale for the portfolio of debts purchased that includes

‘sample’ credit agreements and ‘warranties’ made by the seller

regarding the debts in the portfolio. In many instances, such

12
agreements do not exist. If they do exist, Fabacher’s ‘standard

practice’ does not entail reviewing them before endorsing an

affidavit of merit. He instead relies on the warranties made by the

original creditor . . . .

Fabacher produces the affidavits of merit for signature in batches of

up to 50 at a time. He ‘quality check[s]’ one affidavit in each batch

and if it is accurate, he signs the remaining affidavits in the batch

without reviewing them. The quality check consists of ensuring that

information printed on the affidavit matches the information stored

in the Debt Master database.

Id. at 285 (alteration in original). Reviewing these allegations at an earlier stage in

the proceedings, the district court concluded that “[a]ssuming 260 business days

a year, Fabacher had to have personally (and purportedly knowledgeably) issued

an average of twenty affidavits of merit per hour, i.e., one every three minutes,

over a continuous eight‐hour day.” Sykes v. Mel Harris & Assocs., LLC, 757 F.

Supp. 2d 413, 420 (S.D.N.Y. 2010) (“Sykes I”).

Plaintiffs point out that the practice of Leucadia defendants in purchasing

these charged‐off debts, which involves acquiring only limited information with

respect to the character of this debt, is not uncommon in the secondary consumer

debt market. Typical information transmitted in the purchase of a consumer debt

will include the consumer’s name, address, and the amount owed. See Federal

Trade Commission, The Structure and Practices of the Debt Buying Industry, 34–35

13
(Jan. 2013), available at

http://www.ftc.gov/sites/default/files/documents/reports/structure‐and‐practices‐

debt‐buying‐industry/debtbuyingreport.pdf (last visited Feb. 6, 2015). It is

extremely rare, however, that the purchaser of the debt will receive any

underlying documentation on the debt. Id.

III. Proceedings Below

Monique Sykes commenced this action against “some of the Leucadia, Mel

Harris, and Samserv defendants” on October 6, 2009, alleging FDCPA and GBL

claims. Sykes II, 285 F.R.D. at 285. Rea Veerabadren joined the action on December

28, 2009, and “class allegations and RICO claims were added.” Id. Kelvin Perez

joined the suit on March 31, 2010, at the filing of a second amended complaint,

which added the New York Judiciary Law claim against Mel Harris. Id.

Defendants moved to dismiss, and the district court denied the motion. In

adjudicating the motion to dismiss, the district court reasoned, inter alia, that the

FDCPA claims were not time‐barred under the relevant one‐year statute of

limitations for Sykes and Perez on the grounds that those claims had been

equitably tolled. Sykes I, 757 F. Supp. 2d at 421–22. This was because, the district

court found, “sewer service purposefully ensures that a party is never served,

14
[therefore] it is plausible that defendants’ acts were ‘of such character as to

conceal [themselves]’ to warrant equitable tolling.” Id. at 422 (second alteration in

original) (quoting Bailey v. Glover, 88 U.S. (21 Wall.) 342, 349–50 (1874)).

For their part, Samserv defendants moved to dismiss the FDCPA claims on

the grounds that they were not “debt collectors” for the purposes of the FDCPA.

Id. at 423 (citing exemptions for process servers under 15 U.S.C. § 1692a(6)(D)).

The district court disagreed, reasoning that the FDCPA “protects process servers

only ‘while’ they serve process,” and therefore “Samserv defendants’ alleged

failure to serve plaintiffs process and provision of perjured affidavits of service

remove them from the exemption.” Id.

Leucadia and Samserv defendants further argued that plaintiffs lacked

standing to bring their claims under RICO. Id. at 427. This was because,

according to defendants, plaintiffs could neither establish an injury to their

property interest nor that “the RICO violations were [] the proximate cause of

their injuries “ Id. The district court disagreed, reasoning that “defendants’

pursuit of default judgments and attempts to enforce them against plaintiffs

proximately caused their injuries, see Baisch v. Gallina, 346 F.3d at 366, 373–74 (2d

Cir. 2003), which include the freezing of personal bank accounts and incurring of

15
legal costs to challenge those default judgments.” Id. at 427–28.

Finally, Leucadia and Mel Harris defendants challenged the district court’s

subject matter jurisdiction under the Rooker‐Feldman doctrine, “because plaintiffs

are effectively appealing from a state‐court judgment.” Id. at 429. The district

court rejected this argument as well. First, the district correctly noted that the

doctrine would only apply if “a plaintiff invites a district court to review and

reject an adverse state‐court judgment.” Id. (citing Hoblock v. Albany Cnty. Bd. of

Elections, 422 F.3d 77, 85 (2d Cir. 2005)). The district court then concluded that

“plaintiffs assert claims independent of the state‐court judgments and do not

seek to overturn them.” Id.

Following the district court’s decision, plaintiffs moved for class

certification, as well as for another opportunity to amend their complaint. Sykes

II, 285 F.R.D. at 285. The third amended complaint (the operative complaint on

appeal) added Clifton Armoogam as plaintiff and an additional Leucadia entity

as defendant. Id. The district court granted the motion for class certification on

September 4, 2012. Id. at 294. Leucadia and Mel Harris defendants obtained new

counsel after this decision.

On March 28, 2013, the district court adopted plaintiffs’ proposed class

16
certification order. The two classes certified are as follows.

Pursuant to Federal Rule of Civil Procedure 23(b)(2), a class is

certified of all persons who have been or will be sued by the Mel

Harris defendants as counsel for the Leucadia defendants in actions

commenced in New York City Civil Court and where a default

judgment has been or will be sought. Plaintiffs in the Rule 23(b)(2)

class assert claims under [RICO], [GBL] § 349, and New York Judiciary

Law § 487.

Pursuant to Rule 23(b)(3), a class is certified of all persons who

have been sued by the Mel Harris defendants as counsel for the

Leucadia defendants in actions commenced in New York City Civil

Court and where a default judgment has been obtained. Plaintiffs in

the Rule 23(b)(3) class assert claims under RICO; the [FDCPA]; GBL §

349, and New York Judiciary Law § 487.

Special App’x at 46‐47.

JURISDICTION

The district court exercised jurisdiction under 28 U.S.C. § 1331, 28 U.S.C. §

1367, and 15 U.S.C. § 1962k(d). After certification, each defendant timely

petitioned for leave to appeal the grant of certification pursuant to Rule 23(f) of

the Federal Rules of Civil Procedure. Our court granted these petitions July 19,

2013. We have jurisdiction pursuant to 28 U.S.C. § 1292(e).

STANDARD OF REVIEW

17
“We review a district court’s decision to certify a class under Rule 23 for

abuse of discretion, the legal conclusions that informed its decision de novo, and

any findings of fact for clear error.” In re U.S. Foodservice Inc. Pricing Litig., 729

F.3d 108, 116 (2d Cir. 2013) (“In re U.S. Foodservice”).

DISCUSSION

I. Legal Standards

A. Class Certification

“The class action is ‘an exception to the usual rule that litigation is

conducted by and on behalf of the individual named parties only.’” Wal‐Mart

Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2550 (2011) (quoting Califano v. Yamasaki, 442

U.S. 682, 700–701 (1979)). Two classes of plaintiffs were certified in this case,

under both Rule 23(b)(2) and Rule 23(b)(3) of the Federal Rules of Civil

Procedure. As such, plaintiffs must meet both the requirements for the particular

relief, injunctive or monetary, sought under those two rules, as well as the

threshold requirements for class certification under Rule 23(a).

1. Rule 23(a) Prerequisites

Rule 23(a) of the Federal Rules of Civil Procedure provides that a class may

be certified only if four prerequisites have been met: numerosity, commonality,

18
typicality, and adequacy of representation. See Dukes, 131 S. Ct. at 2550; accord In

re Nassau Cnty. Strip Search Cases, 461 F.3d 219, 225 (2d Cir. 2006). Specifically, the

Rule provides as follows:

One or more members of a class may sue or be sued as

representative parties on behalf of all members only if:

(1) the class is so numerous that joinder of all members is

impracticable;

(2) there are questions of law or fact common to the class;

(3) the claims or defenses of the representative parties are

typical of the claims or defenses of the class; and

(4) the representative parties will fairly and adequately protect

the interests of the class.

Fed. R. Civ. P. 23(a). These remaining requirements “do[] not set forth a mere

pleading standard. A party seeking class certification must . . . be prepared to

prove that there are in fact sufficiently numerous parties, common questions of

law or fact, etc.” Dukes, 131 S. Ct. at 2551.

The Supreme Court has recently clarified the commonality requirement

under Rule 23(a). “Commonality requires the plaintiff to demonstrate that the

class members have suffered the same injury. This does not mean merely that

they have all suffered a violation of the same provision of law.” Id. (internal

quotation marks and citation omitted). Interpreting this requirement in the

context of sexual discrimination claims in violation of Title VII of the Civil Rights

19
Act, the Court instructed that such claims “must depend upon a common

contention—for example, the assertion of discriminatory bias on the part of the

same supervisor. That common contention, moreover, must be of such a nature

that it is capable of classwide resolution—which means that determination of its

truth or falsity will resolve an issue that is central to the validity of each one of the

claims in one stroke.” Id. at 2551 (emphasis added). Furthermore, the Court noted

that in certain “context[s] . . . ‘[t]he commonality and typicality requirements of

Rule 23(a) tend to merge. Both serve as guideposts for determining whether

under the particular circumstances maintenance of a class action is economical

and whether the named plaintiff’s claim and the class claims are so interrelated

that the interests of the class members will be fairly and adequately protected in

their absence.’” Id. at 2551 n.5 (alteration in original) (quoting Gen. Tel. Co. of Sw.

v. Falcon, 457 U.S. 147, 157–58 (1982)).

2. Rule 23(b)(2) Requirements for Injunctive Relief

Beyond these prerequisites, Rule 23(b) provides additional considerations

for a district court to consider prior to the certification of a class. Under Rule

23(b)(2), a class action may only be maintained if “the party opposing the class

has acted or refused to act on grounds that apply generally to the class, so that

20
final injunctive relief . . . is appropriate respecting the class as a whole.” Fed. R.

Civ. P. 23(b)(2). The Supreme Court has clarified that certification of a class for

injunctive relief is only appropriate where “a single injunction . . . would provide

relief to each member of the class.” Dukes, 131 S. Ct. at 2557.

3. 23(b)(3) Requirements

Rule 23(b)(3) imposes two additional burdens on plaintiffs attempting to

proceed by class action, namely, predominance and superiority. Specifically, a

class may be certified only if the district court determines as follows:

[T]he questions of law or fact common to class members

predominate over any questions affecting only individual members,

and that a class action is superior to other available methods for

fairly and efficiently adjudicating the controversy. The matters

pertinent to these findings include:

(A) the class members’ interests in individually controlling the

prosecution or defense of separate actions;

(B) the extent and nature of any litigation concerning the

controversy already begun by or against class members;

(C) the desirability or undesirability of concentrating the

litigation of the claims in the particular forum; and

(D) the likely difficulties in managing a class action.  

Fed. R. Civ. P. 23(b)(3).

In assessing the justifications for the creation of Rule 23(b)(3) classes

the Supreme Court has observed as follows:

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While the text of Rule 23(b)(3) does not exclude from certification

cases in which individual damages run high, the Advisory

Committee had dominantly in mind vindication of the rights of

groups of people who individually would be without effective

strength to bring their opponents into court at all. . . . “The policy at

the very core of the class action mechanism is to overcome the

problem that small recoveries do not provide the incentive for any

individual to bring a solo action prosecuting his or her rights. A class

action solves this problem by aggregating the relatively paltry

potential recoveries into something worth someone’s (usually an

attorney’s) labor.” Mace v. Van Ru Credit Corp., 109 F.3d 388, 344 (7th

Cir. 1997).

Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 617 (1997) (some internal quotation

marks and citations omitted).

With respect to common issues, Rule 23(b)(3), by its plain terms, imposes a

“far more demanding” inquiry into the common issues which serve as the basis

for class certification. Id. at 623–24. While the inquiry may be more demanding,

the Supreme Court has also instructed that Rule 23(b)(3) “does not require a

plaintiff seeking class certification to prove that each elemen[t] of [her] claim [is]

susceptible to classwide proof.” Amgen Inc. v. Conn. Ret. Plans and Trust Funds,

133 S. Ct. 1184, 1196 (2013) (internal quotation marks omitted) (alterations in

original). Rather, all that is required is that a class plaintiff show that “common

questions ‘predominate.’” Id. (quoting Fed. R. Civ. P. 23(b)(3)). That is,

22
“[i]ndividual questions need not be absent. The text of Rule 23(b)(3) itself

contemplates that such individual questions will be present. The rule requires

only that those questions not predominate over the common questions affecting

the class as a whole.” Messner v. Northshore Uni. HealthSystem, 669 F.3d 802, 815

(7th Cir. 2012).

Furthermore, “[c]ommon issues may predominate when liability can be

determined on a class‐wide basis, even when there are some individualized

damage issues.” In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124, 139

(2d Cir. 2001); see also Leyva v. Medline Indus. Inc., 716 F.3d 510, 514 (9th Cir. 2013)

(“[T]he presence of individualized damages cannot, by itself, defeat class

certification under Rule 23(b)(3).”). The Supreme Court has explicitly determined

that it is “clear that individualized monetary claims belong in Rule 23(b)(3).”

Dukes, 131 S. Ct. at 2558. For the purposes of class certification, however,

plaintiffs cannot “identif[y] damages that are not the result of the wrong.”

Comcast Corp. v. Behrend, 133 S. Ct. 1426, 1434 (2013). That is, “the plaintiffs must

be able to show that their damages stemmed from the defendant’s actions that

created the legal liability.” Leyva, 716 F.3d at 514. Put another way,

[t]he plaintiffs must . . . show that they can prove, through common

23
evidence, that all class members were . . . injured by the alleged

conspiracy. . . . That is not to say the plaintiffs must be prepared at

the certification stage to demonstrate through common evidence the

precise amount of damages incurred by each class member. But we

do expect the common evidence to show all class members suffered

some injury.

In re Rail Freight Fuel Surcharge Antitrust Litig., 725 F.3d 244, 252 (D.C. Cir. 2013)

(internal citations omitted).

Finally, the disjunctive inquiry that district courts must engage in prior to

class certification requires analysis of the predominance of common issues, as

well as a determination that class certification is the superior method for

adjudicating these claims. Fed. R. Civ. P. 23(b)(3). Rule 23(b)(3) also lists four

factors—individual control of litigation, prior actions involving the parties, the

desirability of the forum, and manageability—which courts should consider in

making these determinations. Fed. R. Civ. P. 23(b)(3)(A)–(D). By the structure of

the rule, these factors seem to apply both to the predominance and superiority

inquiry. However, while these factors, structurally, apply to both predominance

and superiority, they more clearly implicate the superiority inquiry. See, e.g., Vega

v. T‐Mobile USA Inc., 564 F.3d 1256, 1278 (11th Cir. 2009) (“In determining

superiority, courts must consider the four factors of Rule 23(b)(3).”).

24
While Rule 23(b)(3) sets out four individual factors for courts to consider,

manageability “is, by the far, the most critical concern in determining whether a

class action is a superior means of adjudication.” 2 William B. Rubenstein,

Newberg on Class Actions § 4.72 (5th ed. West 2014). As a component of

manageability, in determining whether a class action in a particular forum is a

superior method of adjudication, courts have considered “when a particular

forum is more geographically convenient for the parties . . . or, for example, when

the defendant is located in the forum state.” Id. § 4.71.

B. Claims for Relief

1. FDCPA

Plaintiffs allege that Leucadia, Mel Harris, and Samserv defendants acted

in violation of various provisions of the FDCPA. The FDCPA was enacted “to

eliminate abusive debt collection practices by debt collectors.” 15 U.S.C. § 1692(e).

The statute provides for civil liability for a wide range of abusive actions, and

plaintiffs focus their claims on violations of Section 1692e and Section 1692f of the

statute.

Section 1692e prohibits “false or misleading representations,” and provides

as follows:

25
A debt collector may not use any false, deceptive, or misleading

representation or means in connection with the collection of any

debt. Without limiting the general application of the foregoing, the

following conduct is a violation of this section: . . .  (2) The false

representation of – (A) the character, amount, or legal status of any

debt . . . (8) Communicating or threatening to communicate to any

person credit information which is known or which should be

known to be false, including the failure to communicate that a

disputed debt is disputed. . . . (10) The use of any false

representation or deceptive means to collect or attempt to collect any

debt . . . .

15 U.S.C. § 1692e(2), (8), (10). Section 1692f, for its part, prohibits a debt collector

from “us[ing] unfair or unconscionable means to collect or attempt to collect any

debt.” Id. § 1692f. The FDCPA limits actions to those brought “within one year

from the date on which the violation occurs.” Id. § 1692k(d).

Violations of these provisions expose a debt collector to civil liability.

15 U.S.C. § 1692k. The district court concluded, and defendants do not

meaningfully challenge, that “[l]iability under the FDCPA can be established

irrespective of whether the presumed debtor owes the debt in question.” Sykes II,

285 F.R.D. at 292; see also Baker v. G.C. Svcs. Corp., 677 F.2d 775, 777 (9th Cir. 1982)

(“The Act is designed to protect consumers who have been victimized by

unscrupulous debt collectors, regardless of whether a valid debt actually

exists.”). In the case of a class action, named plaintiffs’ damages are capped at

26
$1,000. 15 U.S.C. § 1692k(a)(2)(A)–(B). Class damages are capped at $500,000 or 1

per centum of the net worth of the debt collector. Id. § 1692k(a)(2)(B). Prevailing

plaintiffs are also entitled to costs and attorney’s fees.  Id. § 1692k(a)(3). The

FDCPA instructs that, in the case of a class action, that damages should be

assessed, inter alia, on the basis of “the frequency and persistence of

noncompliance by the debt collector, the nature of such noncompliance, the

resources of the debt collector, the number of persons adversely affected, and the

extent to which the debt collectorʹs noncompliance was intentional.” Id. §

1692k(b)(2).

2. RICO

To prevail on their civil RICO claims in this case, “plaintiffs must show (1)

a substantive RICO violation under [18 U.S.C.] § 1962, (2) injury to the plaintiff’s

business or property, and (3) that such injury was by reason of the substantive

RICO violation.” In re U.S. Foodservice, 729 F.3d at 117. Plaintiffs allege Leucadia,

Mel Harris, and Samserv defendants together formed a RICO enterprise for the

purposes of 18 U.S.C. § 1961(4), which the district court found plausible at the

motion to dismiss stage. Sykes I, 757 F. Supp. 2d at 426. Plaintiffs further allege

here that defendants, as part of this enterprise, engaged in acts of wire and mail

27
fraud in violation of 18 U.S.C. §§ 1341, 1344, which can serve as predicate acts for

a violation of 18 U.S.C. § 1962(c). The district court concluded that plaintiffs had

plausibly alleged that “defendants’ pursuit of default judgments and attempts to

enforce them against plaintiffs proximately caused their injuries, which include

the freezing of personal bank accounts and incurring of legal costs to challenge

those default judgments.” Sykes I, 757 F. Supp. 2d at 427–28.     

3. State Law Claims

Plaintiffs finally bring two claims under state law. First, plaintiffs bring

claims pursuant to New York’s General Business Law, which prohibits

“[d]eceptive acts or practices in the conduct of any business, trade or commerce

or in the furnishing of any service in this state.” N.Y. Gen. Bus. L. § 349(a). “To

maintain a cause of action under § 349, a plaintiff must show: (1) that the

defendant’s conduct is ‘consumer oriented’; (2) that the defendants is engaged in

a ‘deceptive act or practice’; and (3) that the plaintiff was injured by this

practice.” Wilson v. Nw. Mut. Ins. Co., 625 F.3d 54, 64 (2d Cir. 2010) (citing Oswego

Laborers’ Local 214 Pension Fund v. Marine Midland Bank, N.A., 623 N.Y.S. 2d 529,

532–33 (1995). With respect to the first element, it “may be satisfied by showing

that the conduct at issue ‘potentially affect[s] similarly situated consumers.’” Id.

28
(alteration in original) (quoting Oswego Laborers’ Local 214 Pension Fund, 623

N.Y.S. 2d at 533). The statute provides that an individual “may bring an

action . . . to enjoin such unlawful act or practice, an action to recover his actual

damages or fifty dollars, whichever is greater, or both such actions.” N.Y. Gen.

Bus. L. § 349(h). The law also provides that a court may award attorney’s fees and

also treble damages “up to one thousand dollars, if the court finds the defendant

wilfully or knowingly violated this section.” Id.

Second, plaintiffs bring a claim pursuant to the New York Judiciary Law

against the Mel Harris defendants. New York law provides that “[a]n attorney . . .

who . . . [i]s guilty of any deceit or collusion, or consents to any deceit or

collusion, with the intent to deceive the court or any party . . . [i]s guilty of a

misdemeanor, and . . . he forfeits to the party injured treble damages, to be

recovered in a civil action.” N.Y. Jud. L. § 487.

II. Application

A. The Proposed Classes Satisfy the Requirements of Commonality &

Typicality Under 23(a)2

2 As previously noted, the Supreme Court has acknowledged that, in

certain “context[s] . . .  ‘[t]he commonality and typicality requirements of Rule

23(a) tend to merge.’” Dukes, 131 S. Ct. at 2551 n.5 (second alteration in original).

The district court analyzed both typicality and commonality and found that the

29
Rule 23(a)’s commonality prerequisite is satisfied if there is a common

issue that “drive[s] the resolution of the litigation” such that “determination of its

truth or falsity will resolve an issue that is central to the validity of each one of

the claims in one stroke.” Dukes, 131 S. Ct. at 2551. Consideration of this

requirement obligates a district court to determine whether plaintiffs have

“suffered the same injury.” Id. (internal quotation marks omitted). The district

court concluded that plaintiffs had satisfied the commonality requirement of

Rule 23(a). Specifically, the district court reasoned as follows:

[Plaintiffs’] overarching claim is that defendants systematically filed

false affidavits of merit and, in many instances, false affidavits of

service to fraudulently procure default judgments in New York City

Civil Court. Whether a false affidavit of merit or a false affidavit of

service or both were employed in a particular instance, the fact

remains that plaintiffs’ injuries derive from defendants’ alleged

unitary course of conduct, that is, fraudulently procuring default

judgments.

Sykes II, 285 F.R.D. at 290 (internal quotation marks and citation omitted). The

district court thus determined that the common injury in this case, which was the

same for all plaintiffs, is a fraudulently procured default judgment. We conclude

proposed class satisfied the typicality requirement “for many of the same reasons

they meet the commonality requirement.” Sykes II, 285 F.R.D. at 291. Defendants

and plaintiffs agree that in this case, the commonality and typicality

considerations are sufficiently merged to warrant their consideration in tandem.

30
that this commonality determination was not an abuse of discretion.

1. Affidavits of Merit

At the outset, Leucadia and Mel Harris defendants principally argue that,

by characterizing the common issue in this litigation as one involving the false

and fraudulent affidavits of merit, the district court impermissibly discounted the

importance of the affidavits of service. Thus, Leucadia defendants suggest that

“the district court, by elevating the importance of the affidavits of merit and

minimizing the importance of the affidavits of service, impermissibly rewrote

Plaintiffs’ substantive claims.” Mel Harris, likewise, suggest that “the District

Court elevated the importance of the affidavits of merit only by impermissibly

rewriting plaintiffs’ substantive claims to fit the class‐action procedure.” We

disagree. The operative complaint in this case makes clear that both sewer service

and false affidavits of merit are necessary to effectuating defendants’ alleged

scheme. Thus, while the operative complaint alleges that sewer service is “the

primary reason” few defendants appear in New York City Civil Court to defend

against debt collection actions, plaintiffs have made clear that this is but one

component of the overarching debt collection plan effectuated by defendants.

Thus, plaintiffs allege that “in order to secure an otherwise legally unobtainable

31
judgment on default, Defendants fraudulently swear to the courts that they have

actually served their victims, when they have not, and that they have admissible

proof that a debt is owed, when they do not.” Joint App’x at 54. We see nothing

impermissible in the district court determining that defendants’ scheme, which

had multiple components, was a “unitary course of conduct” that depended on

false affidavits of merit for its success. Marisol A. v. Giuliani, 126 F.3d 372, 377 (2d

Cir. 1997).

Second, such a framework makes sense, as it is not disputed that these

false affidavits of merit are necessary to the scheme to procure fraudulently

obtained default judgments based on what is required in state court. The New

York City Civil Court has jurisdiction over debt collection actions that seek to

recover damages of $25,000 or less. N.Y.C. Civ. Ct. Act § 202. Section 3215 of the

New York Civil Practice Law and Rules governs the procedures for obtaining a

default judgment in these courts. Section 3215(a) permits plaintiffs seeking “a

sum certain” to make an application “to the clerk within one year after the

default. The clerk, upon submission of the requisite proof, shall enter judgment

for the amount demanded in the complaint . . . .” N.Y. C.P.L.R. § 3215(a).

Requisite proof, in turn, is defined in Section 3215(f) as “proof of service of the

32
summons and the complaint . . . and proof of the facts constituting the claim, the

default and the amount due by affidavit made by the party.” Id. § 3215(f). Thus,

both affidavits of service, as well as affidavits of merit, are necessary to obtain

default judgments, though neither, independently, is sufficient.  

Plaintiffs’ contention is that Fabacher’s statement in each one of the

affidavits of merit, that he is “personally familiar with, and [has] personal

knowledge of, the facts and proceedings relating to” the default judgment action,

see, e.g., Appellees’ App’x at 10, is false. The reason such statements are false is

that Fabacher has not reviewed, nor do defendants actually possess, documents

relevant to the underlying debt.

Resolving the question of whether this contention is false “will resolve an

issue that is central to the validity of each one of the claims in one stroke.” Dukes,

131 S. Ct. at 2551. With respect to the FDCPA, determining whether Fabacher’s

statement is indeed false resolves the central basis for FDCPA liability in this

case, namely, the prohibition on making “any false, deceptive, or misleading

representation . . . in connection with the collection of any debt.” 15 U.S.C. §

1692e. Similarly, the prohibition on “deceptive acts or practices,” N.Y. Gen. Bus.

L. § 349(a), and the prohibition on attorney’s engaging in “deceit,” N.Y. Jud. L.

33
§ 487, can fairly be said to turn on the falsity of Fabacher’s representation of

personal knowledge. Both wire and mail fraud, the predicate acts underlying

plaintiffs’ theory of RICO liability, may be established “by means of false or

fraudulent . . . representations.” 18 U.S.C. § 1341 (mail fraud); id. § 1343 (wire

fraud). False affidavits of merit thus provide independent bases for liability for

each of the claims advanced by plaintiffs. While the resolution of this question

will not address each element of each of these claims, that is not required for

there to be a common question under Rule 23. See Amgen, 133 S. Ct. at 1196. The

district court did not abuse its discretion by finding that a fraudulently obtained

state court judgment that depended on the filing of a false affidavit of merit could

serve as a common issue satisfying Rule 23(a).

2. Affidavits of Service

Moreover, even assuming that the district court was required to determine

that the false affidavits of service were susceptible to class‐wide proof, we would

still conclude that the district court did not abuse its discretion in finding that the

requirements of Rule 23(a) were satisfied. The district court found, on the basis of

the evidence before it, that there was “substantial support for plaintiffs’ assertion

that defendants regularly engaged in sewer service.” Sykes II, 285 F.R.D. at 284.  

34
Further, determining whether to certify a class may require a court “to consider

how a trial on the merits would be conducted if a class were certified.” Bell Atl.

Corp. v. AT&T Corp. 339 F.3d 294, 302 (5th Cir. 2003) (internal quotation marks

omitted) (discussing predominance requirement under Rule 23(b)(3)).

Plaintiffs articulate two distinct reasons why they will be able to bring

forward at trial competent evidence which will prove the fraudulent nature of the

affidavits of service. First, they suggest that the affidavits of service will not be

entitled to credibility, given the district court’s finding that “defendants regularly

engaged in sewer service.” Sykes II, 285 F.R.D. at 284. Absent the affidavits of

service, the only other means that Samserv defendants would have at their

disposal to prove service would be contemporaneous logbooks, which process

servers are required to keep by law. N.Y. Gen. Bus. L. § 89cc. Absent these

logbooks, the testimony of process servers cannot be credited. First Commercial

Bank of Memphis v. Ndiaye, 733 N.Y.S. 2d 562, 565 (N.Y. Sup. Ct. 2001) (“Testimony

of a process server who fails to keep records in accordance with statutory

requirements cannot be credited.”).

Second, plaintiffs aver that, because Samserv defendants have been

ordered to turn over their logbooks to plaintiffs, but have not, they will be able to

35
prove fraud by spoliation. Rule 37(b)(2)(A) of the Federal Rules of Civil

Procedure permits, in the case of a failure to comply with a discovery order, the

district court to, inter alia, “direct[] that the matters embraced in the order or

other designated facts be taken as established for purposes of the action, as the

prevailing party claims.” Fed. R. Civ. P. 37(b)(2)(A)(i). Proof of fraudulent service

might thus be achieved on a class‐wide level. Defendants misread the

requirements of Rule 23(a) when they suggest that these theories of class‐wide

proof fail to “affirmatively demonstrate [plaintiffs’] compliance with” Rule 23(a).

Dukes, 131 S. Ct. at 2551. All that must be proven, at this stage, is that “there are in

fact sufficiently . . . common questions of law or fact.” Id. Anticipating proof of

failures of service in the manner suggested by plaintiffs is in keeping with

demonstrating a common question of fact based on the district court’s obligation

to anticipate “how a trial on the merits would be conducted if a class were

certified.” Bell Atl. Corp.,  339 F.3d at 302 (internal quotation marks omitted).

In sum, the district court did not abuse its discretion in determining that

plaintiffs had demonstrated sufficiently common questions of law or fact to

satisfy the prerequisites of Rule 23(a).

36
B. The District Court did Not Abuse its Discretion in Certifying the

23(b)(3) Class

While Rule 23(b)(3) also speaks in terms of commonality, it imposes a “far

more demanding” inquiry. Amchem, 521 U.S. at 623–24. By its terms, it anticipates

the existence of individual issues: the class may only be certified if “questions of

law or fact common to class members predominate over any questions affecting

only individual members.” Fed. R. Civ. P. 23(b)(3). The mere existence of

individual issues will not be sufficient to defeat certification. Rather, the balance

must tip such that these individual issues predominate. But the district court

must establish that a class action is superior to “other available methods for fairly

and efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). We

conclude that the district court did not abuse its discretion in finding these

requirements met, and thus certifying this class under Rule 23(b)(3).

1. Common Questions of Law and Fact Predominate

Defendants submit that individual issues will predominate over common

issues in this case because the district court will be forced to confront individual

issues with respect to damages, timeliness, and service. We conclude that the

district court did not abuse its discretion in finding that these issues, even if they

37
are individualized in certain respects, do not predominate over class issues.

a. Damages

In making its decision on the propriety of class certification, the district

court reasoned as follows:

Every potential class member’s claim arises out of defendants’

uniform, widespread practice of filing automatically‐generated, form

affidavits of merit based on ‘personal knowledge’ and, in many

instances, affidavits of service, to obtain default judgments against

debtors in state court. Whether this practice violates the FDCPA,

New York GBL § 349, New York Judiciary Law § 487, and/or

constitutes a pattern of racketeering activity in violation of 18 U.S.C.

§ 1962(c) and (d) does not depend on individualized

considerations. . . . The Court recognizes that should defendants be

found liable on some or all of these claims, individual issues may

exist as to causation and damages as well as to whether a class

member’s claim accrued within the applicable statute of limitations.

This, however, does not preclude a finding of predominance under

Rule 23(b)(3).

Sykes II, 285 F.R.D. at 293.

Plaintiffs’ operative complaint seeks three kinds of damages: statutory

damages; “actual and/or compensatory damages . . . in an amount to be proven at

trial”; and what plaintiffs refer to as “incidental damages.” Joint App’x at 219–20.

It is not disputed that statutory damages under GBL § 349 can be assessed on the

basis of common proof, as they are capped at $50. N.Y. Gen. Bus. L. § 349(h).

38
Furthermore, Congress has devised a generally applicable formula for class

action damages under the FDCPA, one which caps damages at $500,000 and

provides that district courts consider, among other factors, the scope of the

violations of the FDCPA as well as the number of individuals implicated by

fraudulent debt collection practices. 15 U.S.C. § 1692k(b)(2).

The only individualized damages inquiries that “may exist,” Sykes II, 285

F.R.D. at 293, are those that turn, in plaintiffs’ words, on “the return of the money

extracted from them as a result of . . . fraudulent judgments,” as well as

incidental damages. We conclude that inquiries into these damages are not

sufficient grounds on which to conclude that the district court’s determination

that individualized damages issues will not predominate in this case was an

abuse of discretion. In the first place, plaintiffs point out that the amount of any

money extracted from plaintiffs is stored by defendants themselves. Because the

evidence necessary to make out such damages claims, while individual, is easily

accessible, such individual damage considerations do not threaten to overwhelm

the litigation. See Leyva, 716 F.3d at 514.

Second, defendants misstate the central holding of Comcast in an attempt to

advance the argument that individual damages issues predominate in this case. It

39
is true that the Court, in Comcast, reversed a grant of class certification on the

grounds that individual damages issues precluded certification. But these

damages claims were individual because, based on undisputed evidence, the

plaintiffs’ “model f[e]ll[ ] . . . short of establishing that damages [were] capable of

measurement on a classwide basis.” 133 S. Ct. at 1433. This was only so, however,

because the sole theory of liability that the district court determined was common

in that antitrust action, overbuilder competition, was a theory of liability that the

plaintiffs’ model indisputably “failed to measure” when determining the

damages for that injury. Id. This is not the case here. The common theory of

liability that plaintiffs advance is dependent on a fraudulent course of conduct

that was allegedly engaged in by defendants, in violation of multiple federal and

state statutes. That liability model is uniquely tied to the damages, which

plaintiffs claim they are entitled to with respect to each claim that they advance,

whether under the FDCPA, RICO, or state statutes. Comcast did not rewrite the

standards governing individualized damage considerations: it is still “clear that

individualized monetary claims belong in Rule 23(b)(3).” Dukes, 131 S. Ct. at 2558.

All that is required at class certification is that “the plaintiffs must be able to

show that their damages stemmed from the defendant’s actions that created the

40
legal liability.” Leyva, 716 F.3d at 514. Plaintiffs in Comcast, admittedly, could not

do so. Plaintiffs here have satisfied that standard.  

Third, defendants suggest that the district court did not engage in the

“rigorous analysis” required at the class certification stage. In doing so, they

emphasize that the district court’s statement that individualized questions “do[]

not preclude a finding of predominance under Rule 23(b)(3)” was not sufficient

to make out the opposite conclusion, namely, that common questions did

predominate. Sykes II, 285 F.R.D. at 293. Defendants’ quest for magic words

overlooks the vast number of common issues that the district court identified as

necessary to resolve this litigation. It is true that the law of this Circuit is that the

fact that “damages may have to be ascertained on an individual basis . . . is . . . a

factor that we must consider in deciding whether issues susceptible to

generalized proof ‘outweigh’ individual issues.” McLaughlin v. Am. Tobacco Co.,

522 F.3d 215, 231 (2d Cir. 2008), abrogated on other grounds by Bridge v. Phx. Bond &

Indem. Co., 533 U.S. 639 (2008), as recognized by In re U.S. Foodservice, 729 F.3d at

119. However, from the above it is clear that individual damages did factor into

the district court’s analysis. The district court simply found that these individual

considerations did not outweigh other issues which were common, such as the

41
following:

(1) whether defendants’ practice of filing affidavits of merit and/or

affidavits of service with respect to the plaintiff class members

violates the FDCPA; (2) whether defendants collectively constitute a

RICO enterprise within the meaning of 18 U.S.C. § 1961(4); (3)

whether defendants have engaged in a pattern of racketeering

activity in connection with the collection of debt in violation of 18

U.S.C. § 1962(c) and (d); (4) whether defendants have used deceptive

acts and practices in the conduct of their businesses in violation of

New York GBL § 349; and (5) whether the Mel Harris defendants

have engaged in deceit and collusion with intent to deceive the

courts and any party therein in violation of New York Judiciary Law

§ 487.

    

Sykes II, 285 F.R.D. at 293. Defendants concede that each of these questions is one

that is common to the members of the class certified under Rule 23(b)(3). They

merely quibble with the district court’s assessment that, on balance, these

ultimate issues of liability outweigh the individualized concerns that they raise.

On reviewing the district court’s certification order, this is not a sufficient

contention on which we may rely to conclude that the district court abused its

discretion in certifying this class.

b. Timeliness

The district court acknowledged, as well, that individualized issues of

timeliness may inhere in the class “should defendants be found liable on some or

42
all of these claims.” Id. at 293. Defendants argue, again, that the district court was

wrong to find that the presence of such individual issues did not indicate that

individual issues would predominate. Plaintiffs respond that they do not invoke

equitable tolling. Plaintiffs are correct: in support of their motion for class

certification before the district court, plaintiffs averred that they “do not seek to

include as class members persons whose claims accrued outside the statute of

limitations for each substantive claim. . . . Indeed, only individuals whose claims

accrued within one year prior to the filing of the Complaint will seek relief on the

FDCPA claim.” Sykes v. Mel Harris & Assocs., No. 09‐cv‐8486 (DC), ECF No. 99, at

27.

Defendants point out that the district court had earlier relied on equitable

tolling in order to determine that the claims of Sykes and Perez were timely

under the FDCPA. They do not claim that plaintiffs are estopped from arguing

that equitable tolling does not apply based on the district court’s determination

that Sykes and Perez could bring actions under the FDCPA on the basis of

equitable tolling. Sykes I, 757 F. Supp. 2d at 413. Rather, the only argument with

any impact advanced by any of the defendants with respect to this matter is one

made by Mel Harris defendants, who argue that disclaiming equitable tolling

43
“simply trades (without eliminating) a serious Rule 23(b)(3) predominance

problem for a Rule 23(a) adequacy problem: Class counsel’s decision to abandon

equitable tolling may render the remaining claims a marginally better ‘fit’ for

class treatment. But that comes at the expense of class members they represent

who have claims that are timely only because of equitable tolling . . . .”

We see no merit in this contention. Under Rule 23(a)(4) of the Federal Rules

of Civil Procedure, adequacy is satisfied unless “plaintiff’s interests are

antagonistic to the interest of other members of the class.” Baffa v. Donaldson,

Lufkin & Jenrette Sec. Corp., 222 F.3d 52, 60 (2d Cir. 2000). The fact that some class

members may advance RICO, GBL, and Judiciary Law claims on the basis of the

date that the complaint was filed (as they have longer statutes of limitations, see

Gaidon v. Guardian Life Ins. Co. of America, 727 N.Y.S. 2d 30, 34 (2001) (three years

for GBL claims), Lefkowitz v. Applebaum, 685 N.Y.S. 2d 460, 461 (2d Dep’t 1999)

(three years for New York Judiciary Law); Agency Holding Corp. v. Malley–Duff &

Assocs., 483 U.S. 143, 156 (1987) (four years for RICO)) does not mean the interests

of these class members are antagonistic to those other members of the class that

also advance FDCPA claims.

While it may be true that disclaiming equitable tolling for Sykes and Perez

44
may necessitate the district court to limit the sorts of claims that these named

plaintiffs may bring, that is a determination for the district court to make in the

first instance. It is certainly not a justification for reversing the district court’s

grant of class certification: at the most, if Sykes’s and Perez’s FDCPA claims are

time‐barred, this only means that they cannot assert claims under the FDCPA.

The practical import of such a rule is that Sykes and Perez may be members of a

subclass, advancing only a portion of the claims certified under Rule 23(b)(3).

Such subclasses are contemplated by the Federal Rules, see Fed. R. Civ. P. 23(c)(5),

and may be certified after the original certification order is upheld. See Marisol,

126 F.3d at 378 (holding that the district court did not abuse its discretion in

certifying the class but suggesting that prior to trial the district court “ensure that

appropriate subclasses are identified”).

It is within plaintiffs’ prerogative to disclaim equitable tolling, and they

may do so without sacrificing the adequacy of representation, especially as

defendants make no actual attempt to show why such a disclaimer may be

antagonistic. It is for the district court to determine the impact of this disclaimer

on the specific claims particular plaintiffs may bring, but it may do that at a

45
future date, without our disturbing the class certification order.3

c. Causation

The district court also determined that individual causation issues may

exist in this case, Sykes II, 285 F.R.D. at 293, but nevertheless found that such

causation issues would not predominate. We agree.

Individual issues related to causation in this case are formulated by

defendants on appeal as individual issues related to service. Thus, for example,

Mel Harris advance the argument that “a class member who was properly served

and paid debts that he actually owed has sustained a radically different ‘injury’

from an unserved member subject to a default judgment for a debt he did not

owe.” Likewise, Leucadia defendants submit that “where the entry of judgment

resulted from a debtor’s failure to appear despite adequate notice, the debtor

3 For similar reasons, defendants’—and the dissent’s, see infra Op. pp.

20–21—contentions regarding the inappropriateness of certifying a class to bring

claims against Samserv, when Samserv admittedly did not serve process on all

individuals who were sued or will be sued in New York City Civil Court by Mel

Harris on behalf of Leucadia, are also misplaced. Plaintiffs who were not served

by Samserv allege no FDCPA or GBL claims against Samserv—they only bring

RICO claims. Carving out such claims may also be the subject of an appropriate

subclass under Rule 23(c)(5), but this is for the district court to determine in the

first instance. See Marisol, 126 F.3d at 379 (“Rule 23 gives the district court

flexibility to certify subclasses as the case progresses and as the nature of the

proof to be developed at trial becomes clear.”).

46
must articulate a different theory of injury.” None of these contentions are

availing.

First, with respect to the FDCPA claims, the district court concluded that

the existence of an underlying debt was unnecessary in order to establish liability

under that statute. Sykes II, 285 F.R.D. at 292. Affidavits of merit, submitted to the

Civil Court, were allegedly fraudulent in attesting to “personal knowledge” of

the existence of such underlying debt, and were also necessary to obtaining the

default judgments that plaintiffs allege were fraudulently obtained. We fail to

recognize any individualized causation issues with respect to plaintiffs’ claims

under the FDCPA. See Baker, 677 F.2d at 777 (actual debt is not necessary to bring

claims under the FDCPA).

Second, where causation does seem most relevant to us, and where we

presume the district court recognized such individualized causation issues, was

with respect to plaintiffs’ claims under RICO. This is because RICO requires that

the alleged injury to plaintiffs’ “business or property . . . was by reason of the

substantive RICO violation.” In re U.S. Foodservice, 729 F.3d at 117. This causation

analysis will require the district court to identify (1) the property interest that is

protected by RICO, as alleged by plaintiffs, and (2) whether the injury to that

47
interest was caused by the RICO violation. The district court at least found that

the injuries to plaintiffs included “freezing of personal bank accounts and

incurring of legal costs to challenge those default judgments.” See Sykes I, 757 F.

Supp. 2d at 427–28. Defendants do not challenge that this is a sufficient property

interest on appeal. Nor do they bring forward any evidence that the damage to

these property interests was not the result of default judgments. What they do

argue, however, is that if a debt was actually owed, and a default judgment was

achieved by means of proper service, a plaintiff cannot actually be an injured

party under RICO to the extent that defendants extracted money based on a

default judgment. The argument has force. But it remains a single arguably

individual issue among the myriad common issues that we have already noted.

We will not upset the district court’s determination that plaintiffs have carried

their burden to show that common issues predominate on the basis of

defendants’ construction of this hypothetical class plaintiff alleging one

particular claim.

Third, none of the potential causation issues related to service suggest that

Samserv is not a proper class defendant in this case. It is true that Samserv was

kept in this litigation with respect to the FDCPA claims on the basis that it could

48
not claim the benefits of the FDCPA’s exemption for process servers on the

grounds that the district court concluded, at the motion to dismiss stage, that

plaintiffs adequately alleged that Samserv engaged in sewer service. Sykes I, 747

F. Supp. 2d at 423. This does nothing to absolve Samserv of claims under RICO,

however, which premises Samserv’s liability on its participation in a RICO

conspiracy. See Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 495–97 (1985). Nor,

based on our conclusions regarding the amenability of class claims regarding

common proof of the falsity of Samserv’s affidavits of service, supra at pp. 34–36,

does it mean that Samserv is not a proper defendant with respect to plaintiffs’

FDCPA claims.

In short, the district court properly considered the evidence before it. It

concluded that, while individual issues existed in this case, they did not

predominate over common issues. Defendants wish the district court had

performed this balancing equation differently. But that is not sufficient for us to

find that the district court abused its discretion in certifying this class under Rule

23(b)(3).    

2. Proceeding by Class is a Superior Method of Adjudication

a. Defendants’ Theory of Superiority is Unpersuasive

49
Mel Harris defendants raise, for the first time on appeal, the novel theory

that the district court’s superiority analysis was incorrect because it undervalued

the obligation to consider the “desirability . . . of concentrating the litigation of

the claims in the particular forum.” Fed. R. Civ. P. 23(b)(3)(C). In particular, Mel

Harris suggest that “[i]f the gravamen of this case . . . really were the adequacy of

the affidavits of merits filed with the New York City Civil Court, surely that court

is the superior forum to hear the complaint and devise any remedies.”4

This is a fine rhetorical point that depends for its strength on a complete

misreading of (1) the jurisdiction of the New York City Civil Court, (2) the

4 The dissent intimates that Mel Harris cannot be expected to have

previously raised this superiority theory, as their arguments below were tailored

to plaintiffs’ emphasis on sewer service, which involved questions of fact unique

to each debtor. See infra Op. p. 10. According to the dissent, class counsel’s shift in

the focus of the complaint, to the submission of false affidavits of merit, accounts

for the new state‐forum argument. But this explanation falls flat, as any shift in

the focus of plaintiffs’ allegations has not affected the nature of defendants’

contentions. Mel Harris defendants continue to insist that resolution of plaintiffs’

claims will require “individualized showings,” now related to the affidavits of

merit, which will result in “one hundred thousand mini‐trials.” Further, the state

procedural remedy the dissent endorses to address these claims concurrently, see

infra Op. pp. 8–14, could have been raised by Mel Harris before the district court,

as that provision applies to sewer service, see N.Y. C.P.L.R. § 5015(c) (providing,

upon application of an administrative judge, for en masse vacatur of default

judgments obtained, inter alia, by “fraud, misrepresentation, . . . lack of due service,

. . . or other illegalities”) (emphasis added)).

50
requirements of Rule 23(b)(3), and (3) the gravamen of plaintiffs’ complaint.

In the first place, there is no basis to assert that plaintiffs’ claims even could

be heard as a class in the New York City Civil Court. These courts have

jurisdiction only over those actions in which the value of the controversy is

$25,000 or less. N.Y.C. Civ. Ct. Act § 202. While individual plaintiffs might seek

to bring their actions in such a court based on this amount‐in‐controversy

limitation, there is no basis to conclude that plaintiffs could proceed as a class

there. The argument amounts to little more than Mel Harris’s expression of a

preference that their alleged widespread fraudulent behavior be dealt with in a

piecemeal fashion. That is not how plaintiffs have chosen to proceed. The fact

that Mel Harris would have preferred plaintiffs to have advanced their claims

differently cannot make it a requirement under Rule 23(b)(3).

Second, the forum analysis of Rule 23(b)(3) is not grounded in a

consideration of the comparative value of pursuing a claim in federal or state

court. Defendants’ authorities on this issue, which are apparently the only

authorities that have ever conducted a superiority analysis by reference to the

availability of relief in a federal or state forum, have not considered claims

analogous to those brought by plaintiffs here. Kamm v. Cal. City Dev. Corp., 509

51
F.2d 205 (9th Cir. 1975) dealt with a case in which putative class plaintiffs had

already been represented by the State Attorney General in a prior action with

putative class defendants. Id. at 207–08. The same was true of two other cases

defendants rely on for the proposition that analysis of state court action is

required to determine whether a federal forum is superior. Cartwright v. Viking

Indus., Inc., 2009 WL 2982887, at * 14 (E.D. Cal. Sept. 14, 2009) (referencing

ongoing state litigation); Plant v. Merrifield Town Ctr., Ltd. P’ship, 2008 WL

4951352, at * 3 (E.D. Va. Nov. 12, 2008) (same). While there has been state court

litigation in this case, it is not state court litigation which advances the claims that

plaintiffs advance now. Further, we will not credit the statement of the United

States District Court of the Eastern District of Louisiana, that “strains on the state

judicial system after Hurricane Katrina” supported a federal forum for particular

plaintiffs’ claims, as support for Mel Harris’s contention that analysis of the

superiority requires a consideration of the comparative merits of a state or federal

court. Turner v. Murphy Oil USA, Inc., 234 F.R.D. 597, 610 (E.D. La. 2006). The

Turner court purported to consider the value of state versus federal court writ

large, but did so only in the context of resource strains on state court, which have

not been alleged here. And this observation was far from necessary to the

52
holding, given that the district court prefaced this observation by recognizing the

value of certifying a class in order to “centralize these proceedings.” Id.

Defendants here seek the opposite of centralization: rather, they seek the

fragmentation of each of plaintiffs’ claims into, perhaps, hundreds of thousands

of actions. The overwhelming weight of authority suggests that the forum

requirement is one that centers on geography, rather than a comparative analysis

of the benefits available under either federal or state law. Rubenstein, supra,

§ 4.71.  Mel Harris’s authorities have not convinced us otherwise.

Third, Mel Harris’s argument depends on a misreading of the gravamen of

plaintiffs’ allegations. It is ultimately not the procedures of New York City Civil

Court, or the ultimate default judgments, that are at issue in this case. It is, rather,

the fraudulent means that defendants employed in order to obtain those

judgments. These means are the basis of claims that sound both in federal and in

state law. To the extent that the district court had jurisdiction to entertain these

claims, we see no basis for rewriting Rule 23(b)(3)(C) to impose a limit on the

district court’s power.

Even if we were to credit Mel Harris’s argument that forum analysis

requires us to consider state fora as opposed to federal fora, we would not

53
conclude that the district court abused its discretion in concluding that

proceeding by class is superior to alternatives for adjudicating these claims. Fed.

R. Civ. P. 23(b)(3). Defendants engage in no other consideration of the 23(b)(3)

factors. They do not even engage with the district court’s conclusions that a class

action “is, without question, more efficient than requiring thousands of debtors

to sue individually.” Sykes II, 285 F.R.D. at 294. Echoing the Supreme Court’s

concerns in Amchem, 521 U.S. at 617, the district court concluded that “class

members’ interest[] in litigating separate actions is likely minimal given their

potentially limited means with which to do so and the prospect of relatively

small recovery.” Sykes II, 285 F.R.D. at 294 (citing Fed. R. Civ. P. 23(b)(3)(A)).      

Nor are we convinced that proceeding in state court is, as the dissent

suggests, “superior in every way” to class action. See infra Op. pp. 1, 8–13. New

York law provides for the en masse vacatur of default judgments obtained

through fraud or other illegal means upon the application of an administrative

judge, who “may bring a proceeding to relieve a party or parties” from such

judgments. N.Y. C.P.L.R. § 5015(c) (emphasis added). Having initiated this

proceeding, the administrative judge, rather than the judgment defaulter, acts as

the petitioner before a different judge who is to decide the application. See, N.Y.

54
C.P.L.R. § 5015 (McKinney), Practice Commentaries, C5015:13; see also, Mead v.

First Trust & Deposit Co., 397 N.Y.S. 2d 295, 297 (N.Y. Sup. Ct. 1977)

(acknowledging denial of amicus curiae status to legal services corporation that

requested proceedings under forerunner provision to § 5015(c) because it “was

interested in the outcome of the proceeding”). Notwithstanding its remedial

purposes, this discretionary procedure (1) provides plaintiffs no right of action,

(2) cannot address the gravamen of the plaintiffs’ allegations here as it could only

vacate the default judgments against them, and (3) denies plaintiffs any control

over the course of the litigation. The dissent’s distaste for “hungry lawyers,” and

aversion to awarding attorneys’ fees in class actions, see infra Op. pp. 10, 14,

cannot justify requiring plaintiffs, under the guise of Rule 23(b)(3)’s superiority

analysis, to pass through the threshold of the state courthouse to seek relief that

cannot seriously be entertained as an adequate, let alone superior, substitute for

proceeding by class on these claims.

b. Defendants’ Rooker‐Feldman and Full Faith & Credit

Arguments are Unavailing at the Class Certification

Stage

Just how far Mel Harris’s superiority arguments fall from the mark of

55
requiring reversal of the district court’s class certification order under Rule

23(b)(3)(C) becomes even clearer when considered in light of the two doctrinal

bases on which defendants argue that class certification was inappropriate in

light of federalism concerns, namely, the Rooker‐Feldman doctrine and the Full

Faith and Credit Act. We take these arguments in order.

Rooker‐Feldman bars the federal courts from exercising jurisdiction over

claims “brought by state‐court losers complaining of injuries caused by state‐

court judgments rendered before the district court proceedings commenced and

inviting district court review and rejection of those judgments.” Exxon Mobil Corp.

v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005). We have clarified that in order

to satisfy the requirements of Rooker‐Feldman, the defendant must satisfy the

following four requirements:

First, the federal‐court plaintiff must have lost in state court. Second,

the plaintiff must complain of injuries caused by a state‐court

judgment. Third, the plaintiff must invite district court review and

rejection of that judgment. Fourth, the state‐court judgment must

have been rendered before the district court proceedings

commenced.

Hoblock, 422 F.3d at 85 (internal quotation marks and modifications omitted). The

causation requirement is only satisfied if “the third party’s actions are produced

56
by a state court judgment and not simply ratified, acquiesced in, or left

unpunished by it.” Id. at 88.

The district court concluded, at the motion to dismiss stage, that “plaintiffs

assert claims independent of the state‐court judgments and do not seek to

overturn them.” Sykes I, 757 F. Supp. 2d at 429. We agree. As explained

previously, claims sounding under the FDCPA, RICO, and state law speak not to

the propriety of the state court judgments, but to the fraudulent course of

conduct that defendants pursued in obtaining such judgments.

Leucadia defendants, for their part, offer the more subtle argument that the

causation components of Rooker‐Feldman required the district court to exclude

from its class certification order “remittance” damages, by which Leucadia means

the compensatory damages that plaintiffs claim defendants have extracted as a

result of the entry of a default judgment. We disagree.

The crux of the issue, as identified by Leucadia, is not simply Rooker‐

Feldman, but rather the requirement that the district court’s certification order

“define the class and the class claims, issues, or defenses, and must appoint class

counsel.” Fed. R. Civ. P. 23(c)(1)(B). Leucadia’s argument is that the certification

order under Rule 23(b)(3), which identifies all of the above but does not exclude

57
the certain category of damages that Leucadia believes is not cognizable under

Rooker‐Feldman, finds no basis in the text of Rule 23, nor in the class certification

decisions that we have identified.

Even if we credited Leucadia’s contention that the state court judgment

satisfied the causal requirements of Rooker‐Feldman, rather than acting as

ratification of a harm that resulted from fraudulent conduct on behalf of

defendants, Hoblock, 422 F.3d at 85, the contention would have no merit.  There is

no textual basis to endorse Leucadia’s view that certain categories of damages

must be carved out of a class certification order under Rule 23(c)(1)(B). The

requirements are that the class, the class claims, and issues, be identified. Fed. R.

Civ. P. 23(c)(1)(B). The district court’s class certification order did just that: it

identified a class of individuals that it defined as “all persons who have been

sued by the Mel Harris defendants as counsel for the Leucadia defendants.”

Special App’x at 47. It further identified the claims as those arising under RICO,

the FDCPA, GBL § 349, and New York Judiciary Law § 487. Special App’x at 47.

There are good reasons for these limited requirements. The district court’s

order is not a final statement of the merits, just as class certification is not an

opportunity to “engage in free‐ranging merits inquiries.” Amgen, 133 S. Ct. at

58
1194–95. We see no use in a class certification order that is required to list all

possible defenses to all possible damage claims, nor do we see, in the text of Rule

23, any requirement for it.

Nor, in our view, do defendants’ arguments sounding under the Full Faith

and Credit Act fare much better. The act requires that state court proceedings

must be afforded “the same full faith and credit in every court within the United

States . . . as they have by law or usage in the courts of such State . . . from which

they are taken.” 28 U.S.C. § 1738. Defendants urge that such doctrine bars us

from considering plaintiffs’ damages claims seeking the return of default

judgments, because state courts treated judgments entitling them to recovery as

valid. We decline to consider this argument, however, for the same reasons that

the district court declined to carve out specific damages that might be available to

the class based on its certification order: such a determination is simply not

required under Rule 23(c)(1)(B).5

5 It may also be, on full adjudication of the merits of this issue, that the

district court may determine that the issue has not been properly raised. The

requirement that federal courts afford full faith and credit to state court

judgments is an argument that federal courts must give res judicata effect to the

state court judgment. See Kremer v. Chem. Constr. Corp., 456 U.S. 461, 481–82

(1982). Res judicata is an affirmative defense that must be pleaded. See Fed. R.

Civ. P. 8(c). Defendants have not asserted a res judicata defense in their answers.

59
A word may be in order, however, to illustrate how far afield defendants’

arguments sounding in federalism require us to go from the ultimate merits of

plaintiffs’ claims. The parties remonstrate over whether or not Fabacher’s

declaration as to “personal knowledge” was in fact required to make out an

application for a default judgment in New York Civil Court. Thus, Mel Harris in

particular have asked us to consider a Directive of the New York Civil Court,

issued in 2009. This directive imposes burdens on third‐party creditors seeking

default judgments in addition to those imposed under Section 3215 of the CPLR.

N.Y.C. Civ. Ct. Directive DRP‐182 (May 2009). This Directive requires, in

particular, that a third‐party debt collector include “[a]n Affidavit of a Witness of

the Plaintiff, which includes a chain of title of the accounts, completed by the

plaintiff/plaintiff’s witness.” Id. This form affidavit only requires the witness to

attest to the chain of title “to the best of [his or her] knowledge.” Id. Plaintiffs, for

their part, point to a checklist prepared by the New York City Civil Court, which

directs parties pursuing a default judgment to submit “an Affidavit of Facts from

a person with personal knowledge of the facts.” New York City Civil Court,

Entering Civil Judgments,

http://www.courts.state.ny.us/COURTS/nyc/civil/judgments_atty.shtml#checklist

60
(last visited Feb. 6, 2015).

Whether or not Fabacher was required to attest to personal knowledge of

the underlying debt in his affidavit of merit, as plaintiffs contend, or whether a

more lax standard governs his affidavits, as Mel Harris contend, is ultimately

irrelevant to adjudicating liability under any of the claims that plaintiffs have

brought. What matters is that, in hundreds of thousands of forms, he did attest to

this knowledge, despite the undisputed fact, at the class certification stage, that

he did not in fact actually review underlying documentation related to these

loans. Whatever was required in New York City Civil Court will not decide the

issue of liability for these defendants. The conduct of defendants, and the

question of whether this conduct was ultimately fraudulent, will decide their

liability. The federal system, with its guarantees of concurrent jurisdiction, and

the federal laws under which plaintiffs seek relief, permit as much.

3. We Decline to Decide, in the First Instance, Whether the

FDCPA Permits Claims for the False Statements Alleged

Here

Defendants raise a final issue related to the propriety of class certification,

namely, the question of whether or not the FDCPA permits a plaintiff to assert

claims for a false statement that was made to a party other than the debtor.

61
We must determine the propriety of making a decision on this issue at this

stage in the proceedings. Plaintiffs point out that we are not to “engage in free‐

ranging merits inquiries at the certification stage.” Amgen, 133 S. Ct. at 1194–95.

And it is undisputed that the question of whether false statements, such as those

made by Fabacher in his affidavits of merit, made to third parties are actionable

under the FDCPA is a question common to the class under both Rule 23(a) and

23(b)(3): resolving that such statements are not actionable would “resolve an

issue that is central to the validity” of the FDCPA claim “in one stroke.” Dukes,

131 S. Ct. at 2551. Indeed, the district court’s class certification decision stated

that “there is a question of law as to whether making false representations in

court, rather than to a debtor, violates the FDCPA,” Sykes II, 285 F.R.D. at 290, but

ultimately did not pass on the issue. We think this the proper determination, as it

is unlikely that the Federal Rules, which require a plaintiff to identify a common

question at the class certification stage, also require the district court to resolve

that question at the same stage in the litigation. The district court did not commit

error in declining to rule definitively on whether the FDCPA covers the false

statements at issue in this case.

62
We decline to address this question, in the first instance,6 on appeal. See

Dardana Ltd. v. Yuganskneftegaz, 317 F.3d 202, 208 (2d Cir. 2003) (“It is this Court’s

usual practice to allow the district court to address arguments in the first

instance.”). We leave it to the district court to decide this issue at a later stage of

the litigation.

C. The District Court Did Not Abuse its Discretion in Certifying the Rule

23(b)(2) Class

1. Proposed Injunctive Relief Benefits All Class Members

Injunctive relief is appropriate if “the party opposing the class has acted or

refused to act on grounds that apply generally to the class.” Fed. R. Civ. P.

23(b)(2). The district court concluded that such relief was appropriate because of

“defendants’ uniform filing of false affidavits in state court to fraudulently

procure default judgments against putative class members.” Sykes II, 285 F.R.D. at

293. This injunction, as currently sought by plaintiffs, includes four elements:

first, a direction that defendants “cease engaging in debt collection practices that

violate the FDCPA, RICO, NY GBL § 349, and NY Jud. Law § 487;” second, a

6 We have not ruled on whether an FDCPA claim may be brought for

misrepresentations made to third parties. Kropelnicki v. Siegel, 290 F.3d 118, 128

(2d Cir. 2002).

63
direction that defendants locate and notify class members that a default judgment

has been entered against them and that “they have the right to file a motion with

the court to re‐open their case;” third, a direction that defendants “serve process

in compliance with the law in any and all future actions;” and fourth, a direction

that defendants’ affidavits of merit in future actions reflect their personal

knowledge of the facts. Joint App’x at 219.

1 The Supreme Court has clarified that certification of a class for injunctive

2 relief is only appropriate where “a single injunction . . . would provide relief to

3 each member of the class.” Dukes, 131 S. Ct. at 2557; Amara v. CIGNA Corp., Nos.

4 13‐447(L), 13‐526(XAP), 2014 WL 7272283, at *9 (2d Cir. 2014) (noting that the

5 Supreme Court in Dukes “simply emphasized that in a class action certified under

6 Rule 23(b)(2), ‘each individual class member’ is not ‘entitled to a different

7 injunction’” (emphasis in original) (quoting Dukes, 131 S. Ct. at 2557)).  Mel

8 Harris submit that this proposed injunctive relief does not satisfy this standard,

9 because individualized issues of service differentiate class members from one

10 another, and the named plaintiffs will not benefit because they “have already had

11 their default judgments vacated.”

12 This claim is without merit. “[R]elief to each member of the class,” does not

64
1 require that the relief to each member of the class be identical, only that it be

2 beneficial. Dukes, 131 S. Ct. at 2557–58. And while Mel Harris attempt to refocus

3 the proposed injunctive relief on the affidavits of service, it is clear that the

4 proposed injunctive relief sweeps broadly enough to benefit each class member.

5 There is no support for the contention, for example, that because certain class

6 members received service, they will not be provided relief by the notification

7 proposed by the injunction as well. See Amara, 2014 WL 7272283, at *9 (finding

8 decertification of Rule 23(b)(2) class not required where certain class members,

9 who might not benefit from injunction’s reformation of retirement plan, received

10 “some benefit in the form of new notice” of changes to the plan). Furthermore,

11 while named plaintiffs have had their default judgments vacated, they might

12 each still be subject to a further action by these same defendants. The district

13 court did not abuse its discretion in concluding that plaintiffs had satisfied the

14 requirements of Rule 23(b)(2).

15 2. We Decline to Decide, in the First Instance, Whether RICO

16 Permits Private Injunctive Relief

17 Defendants finally argue that injunctive relief is not available under RICO.

18 For the same reasons that we found the district court did not commit error in

65
1 declining to rule on the availability of relief under the FDCPA, we find that the

2 district court did not commit error in declining to decide, at the class certification

3 stage, whether RICO permits private injunctive relief.

4 Because the district court did not reach this question below, we decline to

address it for the first time7 5 on appeal. See Dardana, 317 F.3d at 208.

6 CONCLUSION

7 For the foregoing reasons, the opinion and order of the district court is

8 hereby affirmed.

9

7 We have yet to decide whether RICO allows for private injunctive relief.

See, e.g., Motorola Credit Corp. v. Uzan, 202 F. Supp. 2d 239, 243 (S.D.N.Y. 2002).

66
DENNIS JACOBS, Circuit Judge, dissenting:

This class action alleges that the defendant firms cut sharp corners in

obtaining default judgments against the class members in the Civil Court of New

York City.  On this interlocutory appeal from class certification, the panel

concludes that the superiority and predominance prerequisites to a Rule 23(b)(3)

damages class have been satisfied.  I respectfully dissent.  

The superiority ruling is error because a statutory procedure is available, in

the Civil Court itself, for redressing such an allegedly wide‐ranging fraud‐‐one

that is superior in every way to this unwieldy federal class action.  The district

court’s predominance ruling cannot be sustained because the court failed to

perform, as is necessary, a rigorous weighing of common and individualized

issues.  The majority also holds that a Rule 23(b)(2) equitable and declaratory

relief class was properly certified even though the named plaintiffs can get no

benefit from that supposed relief because they have already achieved vacatur (or

discontinuance) of the default judgments against them.

This is class litigation for the sake of nothing but class litigation.

I

Four plaintiffs, on behalf of a class of over 100,000, sued a buyer of bad
debts (the “Leucadia defendants”), a law firm (the “Mel Harris defendants”), and

a process server (“Samserv”), alleging that they fraudulently obtained default

judgments against the class members.  The alleged scheme proceeded in two

steps: (1) a process server, sometimes a Samserv employee (but more often than

not, not) engaged in sewer service, and then prepared a fraudulent affidavit of

service; and (2) the debt buyer and the law firm generated and submitted

standardized affidavits of merit falsely attesting to personal knowledge of the

debt.  See N.Y. C.P.L.R. 3215(f) (requiring “proof of the facts constituting the

claim, the default and the amount due”).

The dominant focus of the complaint is the fraud in service of process;1

although plaintiffs do not actually deny that many class members received

proper service.  But service is too individualized an issue for class certification.

The point was recognized implicitly by the district court,2 and acknowledged

 1 See Third Am. Compl. ¶ 4 (“[S]ewer service is the primary reason so few

of the people sued by Defendants appear in court to defend themselves.”); see

also supra Op. p. 31 (acknowledging complaint’s emphasis on sewer service but

concluding “plaintiffs have made clear that this is but one component of the

overarching debt collection plan”).

 2 See Sykes v. Mel Harris & Assocs., LLC, 285 F.R.D. 279, 290 (S.D.N.Y.

2012) (“Sykes II”) (“[Plaintiffs’] overarching claim is that defendants

systematically filed false affidavits of merit and, in many instances, false affidavits

2
more directly by its dismissal of one named plaintiff’s claim as time‐barred

because service had been effected more than a year prior to the entry of default.

Sykes v. Mel Harris & Assocs., LLC, 757 F. Supp. 2d 413, 422 (S.D.N.Y. 2010)

(“Sykes I”).  Plaintiffs’ backstop contention–‐that irregularities in Samserv’s

logbooks should allow for a presumption that all service was fraudulent‐‐is easily

refuted.3

To patch this hole, plaintiffs changed focus to the affidavits of merit (all of

of service to fraudulently produce default judgments . . . .” (emphasis added));

id. at 291 (“[I]ndividualized proof of service or lack thereof is not fatal to the

prerequisite of commonality.  Here, defendants’ uniform course of conduct was

to file an allegedly false affidavit of merit and, at least in some instances, an

allegedly false affidavit of service.” (emphases added)).

 3 See Wal‐Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2555 (2011) (“Even if

[statistical proof] established . . . a pay or promotion pattern that differs from the

nationwide figures or the regional figures in all of Wal–Mart’s 3,400 stores, that

would still not demonstrate that commonality of issue exists. . . .”); id. at 2556

(“Respondents’ anecdotal evidence suffers from the same defects, and in

addition is too weak to raise any inference that all the individual, discretionary

personnel decisions are discriminatory.”); id. at 2561 (“Because the Rules

Enabling Act forbids interpreting Rule 23 to ‘abridge, enlarge or modify any

substantive right,’ a class cannot be certified on the premise that Wal‐Mart will

not be entitled to litigate its statutory defenses to individual claims.” (citations

omitted)); see also 650 Fifth Ave. Co. v. Travers Jewelers Corp., No. LT75766/20,

2010 WL 4187936, at *4 (N.Y.C. Civ. Ct. 2010) (“Where a respondent rebuts an

affidavit of service with a sworn denial of service, the petitioner must establish

jurisdiction by a preponderance of the evidence at a traverse hearing.”).  

3
which were generated by a software program used by a single Mel Harris

employee) as the “glue” holding together this miscellaneous and diverse class.

Wal‐Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2552 (2011).  (The putative debts

are to Sears, a credit card company, a bank, and a gym.4

)

The district court certified two classes: (1) a Rule 23(b)(3) class seeking

money damages for “all persons who have been sued by the Mel Harris

defendants as counsel for the Leucadia defendants in actions commenced in New

York City Civil Court and where a default judgment has been obtained”; and (2)

a Rule 23(b)(2) class seeking equitable and declaratory relief for “all persons who

have been or will be sued by the Mel Harris defendants as counsel for the

Leucadia defendants in actions commenced in New York City Civil Court and

where a default judgment has or will be sought.”  Sykes v. Mel Harris & Assocs.,

LLC, 285 F.R.D. 279, 294 (S.D.N.Y. 2012) (“Sykes II”).  Plaintiffs in both classes

assert claims under the Racketeer Influenced and Corrupt Organizations Act

(“RICO”),5 New York General Business Law,6 and (as against the Mel Harris

 4 See Third Am. Compl. ¶¶ 136, 166, 198, 269.

 5 See supra Op. pp. 27‐28, 34, 47‐49; see also 18 U.S.C. § 1962(c).

 6 See supra Op. pp. 28‐29, 38; see also N.Y. Gen. Bus. Law §§ 349(a), (h).

4
defendants alone) New York Judiciary Law.7

  The damages class also alleges Fair

Debt Collection Practices Act (“FDCPA”) claims.8

II

It is useful and diplomatic to set out first the points of my agreement with

the majority.  I agree that it was no abuse of discretion to find that the Rule 23(a)

prerequisites‐‐numerosity, commonality, typicality, and adequacy of

representation‐‐are met.  There is a common issue as to whether the affidavits of

merit were fraudulent, and the claims asserted about the affidavits of merit are

typical.  Fed. R. Civ. P. 23(a)(2), (3); see also, e.g., Gen. Tel. Co. of Sw. v. Falcon,

457 U.S. 147, 157 n.13 (1982) (“The commonality and typicality requirements of

Rule 23(a) tend to merge.”).  That issue alone is unlikely to be decisive, but the

“determination of its truth or falsity will resolve an issue that is central to the

validity of each one of the claims in one stroke.”  Dukes, 131 S. Ct. at 2551.  Thus,

unlike in Dukes, all of the claims are held together by “glue,” id. at 2552–‐or some

 7 See supra Op. p. 29; see also N.Y. Jud. Law § 487.

 8 See supra Op. pp. 25‐26, 33‐35, 40, 48‐49; see also 15 U.S.C. §§ 1692e,

1692f, 1692k(a).

5
dabs of it.

I also agree that the amount of debt owed by each class member, which

defendants urge as an individualized issue that defeats certification, is beside the

point.  The harm can be viewed as the obligation created by a fraudulent default

judgment, so that it should not matter that the original debt may remain, and be

unaffected.  See Hamid v. Stock & Grimes, LLP, 876 F. Supp. 2d 500, 501‐03 (E.D.

Pa. 2012) (“It is clear from its underlying purpose that debtors may recover for

violations of the FDCPA even if they have defaulted on a debt. . . . If [plaintiff’s]

payment was not a proper element of actual damages under the FDCPA, a debt

collector could harass a debtor in violation of the FDCPA, as a result of that

harassment collect the debt, and thereafter retain what it collected.”); accord

Abby v. Paige, No. 10‐23589‐CIV, 2013 WL 141145, at *8‐9 (S.D. Fla. Jan. 11, 2013);

cf. Sparrow v. Mazda Am. Credit, 385 F. Supp. 2d 1063, 1071 (E.D. Cal. 2005)

(“[S]trong policy reasons exist to prevent the chilling effect of trying FDCPA

claims in the same case as state law claims for collection of the underlying

debt.”); Isa v. Law Office of Timothy Baxter & Assocs., No. 13‐cv‐11284, 2013 WL

5692850, at *3 (E.D. Mich. 2013) (“Congress did not intend for collectors to engage

in violations, enter judgments, and use state law on judgment execution to force

6
payment to creditors.”).

The last point of my agreement with the majority is that the substantive

legal questions the defendants invite us to answer either counsel in favor of

commonality and typicality, or are entirely tangential to the class certification

decision and best left unanswered at this stage.  One such question‐‐what is

required for an affidavit of merit under New York law?‐‐is a common question of

law in this case.  In any event, “Rule 23 grants courts no license to engage in

free‐ranging merits inquiries at the certification stage.  Merits questions may be

considered to the extent‐‐but only to the extent‐‐that they are relevant to

determining whether the Rule 23 prerequisites for class certification are

satisfied.”  Amgen Inc. v. Conn. Ret. Plans & Trust Funds, 133 S. Ct. 1184, 1194‐95

(2013).

    

III

In my view, the damages class was improperly certified.  Rule 23(b)(3)

requires first, that “a class action is superior to other available methods for fairly

and efficiently adjudicating the controversy” and second, that “the questions of

law or fact common to class members predominate over any questions affecting

7
only individual members.”  Fed. R. Civ. P. 23(b)(3).  The Rule specifies, as

“matters pertinent to these findings,” “the desirability or undesirability of

concentrating the litigation of the claims in the particular forum” and “the likely

difficulties in managing a class action.”  Fed. R. Civ. P. 23(b)(3)(C)‐(D) (emphasis

added).  These very factors counsel against certification here.  See Madison v.

Chalmette Refining, LLC, 637 F.3d 551, 554 (5th Cir. 2011) (“The decision to

certify a class is within the broad discretion of the district court, but that

discretion must be exercised within the framework of Rule 23.” (internal

quotation marks and alterations omitted)).

A

The district court concluded that a federal class action is a superior method

for resolving this litigation over state court proceedings, because: (1) it is more

efficient than requiring thousands of individual suits; (2) most class members

would not litigate given the small recovery and their limited means; (3) the

conduct all occurred in New York; and (4) any problems could be alleviated

through use of class management tools.  See Sykes II, 285 F.R.D. at 294.  The

majority endorses this analysis.  See supra Op. pp. 49‐55.

Even if a federal class action were a good way to remedy an allegedly

8
massive and pervasive fraud perpetrated on a New York court, it cannot be

superior to the adequate remedial scheme already offered by the courts of New

York.  State law provides that, “on motion of any interested person,” a party may

be relieved from a judgment based on the grounds of, inter alia, “excusable

default,” “fraud, misrepresentation, or other misconduct of an adverse party.”

N.Y. C.P.L.R. 5015(a)(1), (3).  And, on an application by an administrative judge,

vacatur may be granted en masse “upon a showing that default judgments were

obtained by fraud, misrepresentation, illegality, unconscionability, lack of due

service, violations of law, or other illegalities.”  Id. 5015(c); cf. Jack Mailman &

Leonard Flug DDS, P.C. v. Whaley, No. 31880/02, 2002 WL 31988623, at *6

(N.Y.C. Civ. Ct. Nov. 25, 2002) (forwarding the court’s decision “to the

administrative judge for the possible institution of proceedings in conformity

with C.P.L.R. 5015(c)”).  Because vacatur en masse is done by an administrative

judge, it is a remedy that is broad, wholesale, effective, and easy.  The only

remaining salient advantage of this federal class action is attorneys’ fees, which

do not much help the members of the class.

The majority observes that the availability of recourse to state avenues for

relief was not raised in the district court.  See supra Op. pp. 49 & n.4.  True,

9
defendants’ superiority arguments in their opposition to class certification

focused on the existence of issues personal to each class member, as well as

manageability, and the prospect of “mini‐trials just to determine the threshold

issue of class membership.”  See Mem. of Law in Opp’n to Class Cert., Dkt. No.

90 at 22‐23.  But that is because the complaint was chiefly predicated on sewer

service, an issue as to which facts varied from debtor to debtor, whereas class

counsel (at least for current purposes) shifted focus to the submission of

materially false affidavits of merit.  In any event, the district court’s ruling on

superiority rests on the determination that a class action is “without question,

more efficient than requiring thousands of debtors to sue individually.”  Sykes II,

285 F.R.D. at 294.  It is this consideration that is obviated by the New York

procedure.  See N.Y. C.P.L.R. 5015(c).  “[T]he Legislature has gone so far as to

create a special subdivision allowing an administrative judge to bring a

proceeding to vacate default judgments en masse where obtained by fraud,

misrepresentation . . . lack of service, . . . or other illegalities.”  Shaw v. Shaw, 467

N.Y.S.2d 231, 233 (2d Dep’t 1983) (internal quotation marks omitted).

Rule 23 requires consideration of any other “available method[] for fairly

and efficiently adjudicating the controversy.”  Fed. R. Civ. P. 23(b)(3); see also id.

10
advisory committee notes (observing the court “ought to assess the relative

advantages of alternative procedures” and stating that “[a]lso pertinent is the

question of the desirability of concentrating the trial of the claims in the

particular forum”).  One such “method” that is “available” is afforded by the

New York Legislature for redressing harms alleged in this case by recourse to the

Civil Court, in which the alleged wrong was done.  In the majority’s view, “the

forum analysis of Rule 23(b)(3) is not grounded in a consideration of the

comparative value of pursuing a claim in federal or state court.”  Supra Op. p. 51.

That seems to me error, at least when the state court remedy affords relief‐‐

available en masse‐‐for harm that was suffered in that forum.

Amici briefs filed by consumer advocacy groups explain that unscrupulous

debt collection practices abuse the legal process, and demonstrate that this well‐

documented problem has drawn the attention of all levels of government for

years.  But that observation does not speak to a need for federal class action

remedies.  As the parties point out, the Civil Court has recently issued directives

regarding “Default Judgments on Purchased Debt,” imposing new and

additional requirements on third‐party debt collectors like the Leucadia

11
defendants.9

  Collectors must now include an “Affidavit of Sale of Account by

Original Creditor” and an “Affidavit of the Sale of the Account by the Debt

Seller” for each debt re‐sale.  Cf. Shaw, 467 N.Y.S.2d at 234 (“A judgment

obtained without proper service of process is invalid, even when the defendant

has actual notice of the law suit, because as a prophylactic measure such rule is

necessary to prevent ‘sewer service’”) (citing Feinstein v. Bergner, 48 N.Y.2d 234,

239‐41 (1979)).

The New York court system needs no helping hand from a federal class

action initiative.  The majority observes that plaintiffs’ claims cannot be heard as

a class in Civil Court.  See supra Op. pp. 50‐51.  But class litigation is not an end

in itself.  It is simply a “device to vindicate the rights of individuals class

members.”  In re Gen. Motors Corp. Engine Interchange Litig., 594 F.2d 1106,

1127 n.33 (7th Cir. 1979); see also Blaz v. Belfer, 368 F.3d 501, 504 (5th Cir. 2004)

(explaining a class action is merely a procedural device).  New York’s Civil Court

also provides such a device.  N.Y. C.P.L.R. 5015(c).  The majority also discounts

the state procedure because it is implemented by judges.  See supra Op. p. 54.

 9 Available at

http://www.courts.state.ny.us/courts/nyc/SSI/directives/DRP/drp182.pdf.

12
But one would have thought that to be an advantage; it reduces the burden on

plaintiffs and may obviate the need for counsel altogether.

The majority’s other critiques of the state procedure are easily disposed of.

Vacatur en masse is discretionary‐‐so are many aspects of class certification.  See

id. at 55.  The majority cites to the district court’s observation that a class action

is‐‐“without question”‐‐a more efficient way of proceeding.  Id. at 54.  But the

state remedy is far more speedy than a cumbersome class action.  In state court,

all that is needed is to push on an open door.  And that, evidently, is what the

class representatives themselves did; they have all had their judgments vacated

or discontinued.  Thus, the door of the state court is open for the vacatur of the

default judgments en masse, without class certification, subclasses, hungry

lawyers, or issues of process and statutes of limitations.  Cf. In re Aqua Dots

Prods. Liability Litig., 654 F.3d 748, 752 (7th Cir. 2011) (“A representative who

proposes that high transaction costs (notice and attorneys’ fees) be incurred at

the class members’ expense to obtain a refund that already is on offer is not

adequately protecting the class members’ interests.”).  The countervailing

benefits of a class action accrue almost entirely to the lawyers in a fee‐rich

environment, and leave trivial benefits for consumption by the class.

13
B

“Rule 23(b)(3)’s predominance criterion is even more demanding” than the

“rigorous analysis” mandated under Rule 23(a), and requires a “close look at

whether common issues predominate over individual ones.”  Comcast Corp. v.

Behrend, 133 S. Ct. 1426, 1432 (2013) (internal quotation marks omitted); see also

Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 615, 623‐24 (1997) (“Even if Rule

23(a)’s commonality requirement may be satisfied by that shared experience, the

predominance criterion is far more demanding.”).

The district court acknowledged problems that might easily be viewed as

fatal: “individual issues may exist as to causation and damages as well as to

whether a class member’s claim accrued within the applicable statute of

limitations.”  Sykes II, 285 F.R.D. at 293.  The district court nevertheless hoped

that these problems could be dealt with through “a number of management

tools,” and cited “appointing a magistrate judge or special master to preside over

individual damages proceedings, decertifying the class after the liability trial and

providing notice to class members concerning how they may proceed to prove

damages, creating subclasses, or altering or amending the class.”  Id. at 293‐94

(internal quotation marks omitted).

14
No doubt, resourceful judges can seek or find ways to overcome

difficulties.  But predominance cannot be determined without a careful balancing

of the individualized issues against the common issues.  It is not enough to

discount problems on the basis of hope and confidence.  Compare In re U.S.

Foodservice Inc. Pricing Litig., 729 F.3d 108, 131 (2d Cir. 2013) (“[C]lose

inspection of this case reveals that any class heterogeneity is minimal and is

dwarfed by common considerations susceptible to generalized proof.”) with

Sykes II, 285 F.R.D. at 292 (“[U]se of sewer service and false affidavits of service

may warrant equitable tolling.  Even still, though, the Court can address such

issues at later stages of the litigation if necessary.” (citation omitted)).

The existence of such management tools, which are always at hand, does

not help to distinguish a claim that justifies certification from a claim that does

not.  Cf. Sacred Heart Health Sys., Inc. v. Humana Military Healthcare Servs.,

Inc., 601 F.3d 1159, 1176, 1184 (11th Cir. 2010) (“[A] class action with numerous

uncommon issues may quickly become unmanageable.”); cf. also In re Initial

Pub. Offerings Sec. Litig., 471 F.3d 24, 42 (2d Cir. 2006) (“Plaintiffs’ own

allegations and evidence demonstrate that the Rule 23 requirement of

predominance of common questions over individual questions cannot be met

15
under the standards as we have explicated them.”).  The useful inquiries are why

such tools will be needed and how they would be used.  What proceedings are

envisioned for the magistrate judge?  The magistrate judge who hears a hundred

thousand claims, four a day, would finish work in about a century.  What

subclasses, or “amended” or “alternative” classes would serve‐‐and who would

represent any of them, seeing as how all of the default judgments against the

present class representatives have already been vacated or withdrawn?  A better‐

considered case‐management tool is de‐certification.  See Fed. R. Civ. P.

23(c)(1)(C).

Specifically, many claims in this case may be defeated by the statute of

limitations.  The issue demands a close scrutiny that has not been given.  If

members were served (or otherwise notified) of the default judgment more than

one year before the class action commenced, they cannot now rely on equitable

tolling.  See New York v. Hendrickson Bros., 840 F.2d 1065, 1083 (2d Cir. 1988)

(equitable tolling only appropriate if plaintiff was ignorant of cause of action

because of defendant’s concealment).  A member‐by‐member inquiry concerning

service of process will likely be required.  Moreover, all members served after

April 1, 2008 were provided supplemental notice by the state court before a

16
default judgment was entered, see N.Y. Comp. Codes R. & Regs. tit. 22,

§ 208.6(h)(2); so what will be required is an individualized examination of

whether a plaintiff was served or what notice was effected by the court’s new

system.

In an effort to skate past this appeal, class counsel now jettison their

clients’ defense of equitable tolling, and propose to include as class members

only persons whose claims are not barred by the statute of limitations.  But the

district court (for one) seemed to think the plaintiffs were still seeking the benefit

of equitable tolling when it certified the class.  See Sykes II, 285 F.R.D. at 292.

Crucially, the class definition does not exclude claims based on the date of filing.

Even if this maneuver succeeds (it appears it has), see supra Op. pp. 43‐45,

plaintiffs are simply trading a commonality problem for problems of typicality

and adequacy of representation: the district court earlier relied on equitable

tolling in order to save the FDCPA claims of two of the named plaintiffs.

  

IV

Class certification for equitable and declaratory relief under Rule 23(b)(2)

is likewise deeply flawed.  Such a class may only be certified if “the party

17
opposing the class has acted or refused to act on grounds that apply generally to

the class, so that final injunctive relief or corresponding declaratory relief is

appropriate respecting the class as a whole.”  Fed. R. Civ. P. 23(b)(2).  In other

terms, “Rule 23(b)(2) applies only when a single injunction or declaratory

judgment would provide relief to each member of the class.”  Dukes, 131 S. Ct. at

2557.

The named plaintiffs seek an injunction that would do absolutely nothing

for them.  The injunction sought would direct defendants to (1) conform their

debt collection practices to the laws cited in the complaint, (2) locate and notify

class members that a default judgment has been entered against them and that

they have the right to file a motion to re‐open, (3) serve process in compliance

with law, and (4) produce and file affidavits of merit that truthfully reflect

personal knowledge.  See Third Am. Compl. ¶ 80.  But the default judgments

against all of the named plaintiffs were already vacated or discontinued before they

asserted these claims.  See id. ¶¶ 131, 161, 215, 330; Sykes I, 757 F. Supp. 2d at 429

(“In fact, all plaintiffs have had the default judgments against them vacated or

discontinued.”).  They get nothing from the equitable relief they seek (absent any

speculation that they will be subject to future suits and default judgments by the

18
Leucadia and Mel Harris defendants).  “[A] single injunction or declaratory

judgment” will therefore not “provide relief to each member of the class.”

Dukes, 131 S. Ct. at 2557.

V

I cannot figure out what Samserv is doing here.  The common thread

identified by the district court was the preparation of the allegedly fraudulent

affidavits of merit.  Samserv had no role in drafting those affidavits.  Moreover,

fewer than half the class members were served with process (or given sewer

service) by Samserv.  And though plaintiffs respond that Samserv was still part

of the RICO enterprise, the only common RICO issue identified is the affidavits

of merit.

A class certification order cannot reach a defendant based on a

purportedly common underlying thread unrelated to that defendant’s conduct.

See Fed. R. Civ. P. 23(c)(1)(b) (“An order that certifies a class action must define

the class and the class claims, issues, or defenses . . . .”); see also, e.g., In re Initial

Pub. Offerings Sec. Litig., 471 F.3d at 41 (stating “a district judge may certify a

class only after making determinations that each of the Rule 23 requirements has

19
been met”).

The majority’s proposal that the district court may certify subclasses is no

answer to these problems, for reasons set forth above.  See supra Op. n.3; see also

Sacred Heart Health Sys., 601 F.3d at 1184 (finding subclasses “no answer” when

common questions did not predominate and concluding class action was not

superior to other available means for fairly adjudicating claims).

* * *

Certification of this misbegotten class will generate grinding of gears and

spinning of wheels for years to come, notwithstanding an effective, superior, and

immediately available remedy in state court.

20