Filed 11/12/19

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

TONY SARUN et al.,

Plaintiffs and Appellants,

v.

DIGNITY HEALTH,

Defendant and Respondent.

 B288062

 (Los Angeles County

 Super. Ct. No. BC483764)

APPEAL from an order of the Superior Court of 

Los Angeles County, Maren E. Nelson, Judge. Reversed and 

remanded with directions. 

Law Offices of Barry Kramer, Barry L. Kramer; Carpenter 

Law and Gretchen Carpenter for Plaintiffs and Appellants. 

Ogloza Fortney, Darius Ogloza and David Fortney for 

Defendant and Respondent. 

____________________________
2

Tony Sarun had no health insurance in March 2012 when 

he received emergency care at Northridge Hospital Medical 

Center, then owned and operated by Dignity Health.1 Upon 

admission Sarun signed an agreement to pay the hospital’s “full 

charges, unless other discounts apply.” “Full charges” were

defined as “the Hospital’s published rates (called the 

chargemaster), prior to any discounts or reductions.” The 

admissions contract explained uninsured patients might qualify 

for government aid programs or financial assistance from Dignity

Health. 

After receiving an invoice for $23,487.90, which reflected a

chargemaster rate of $31,359 and a $7,871.10 “uninsured 

discount,” and without applying for any other discount or 

financial assistance, Sarun filed this putative class action 

lawsuit. In his third amended complaint, filed in May 2015, 

Sarun asserts claims for unfair and/or deceptive business 

practices under Business and Professions Code section 17200 

(UCL) and violation of the Consumers Legal Remedies Act 

(CLRA) (Civ. Code, § 1750 et seq.) and seeks declarations that 

Dignity Health’s billing practices as they relate to uninsured 

individuals who received emergency care at a Dignity Health

hospital in California are “unfair, unconscionable and/or 

unreasonable” and that, because the prices to be charged are not 

1 On February 1, 2019 Dignity Health merged with Catholic 

Health Initiatives and adopted the name CommonSpirit Health. 

With this reorganization ownership of Northridge Hospital 

Medical Center and several other Dignity Health community 

hospitals was transferred to Dignity Community Care, a 

Colorado not-for-profit corporation. Dignity Community Care’s 

sole member is CommonSpirit Health.
3

adequately disclosed or readily available to those individuals, its 

admissions contract contains an “open price” term within the 

meaning of Civil Code section 1611,

2

so that self-pay patients3are 

liable only for the reasonable value of the services or treatment 

provided. 

In June 2017 Sarun moved for class certification of his 

cause of action for declaratory relief, now defining the proposed 

class as individuals who had received treatment at Northridge 

Hospital Medical Center during the proposed class period and 

who were directly billed for such treatment at chargemaster rates 

or chargemaster rates less an uninsured discount. In December

2017 the trial court denied Sarun’s motion, finding the class was 

not ascertainable; common issues of fact did not predominate 

because it would be necessary to determine whether thousands of 

individual chargemaster rates were reasonable or unconscionable

to provide meaningful relief; and, for the same reason, a class 

action was neither manageable nor a superior method for 

resolving the litigation. The court’s order did not address Sarun’s 

2 Civil Code section 1611 provides, “When a contract does not 

determine the amount of the consideration, nor the method by 

which it is to be ascertained, or when it leaves the amount

thereof to the discretion of an interested party, the consideration 

must be so much money as the object of the contract is reasonably 

worth.”

3

“‘Self-pay patient’ means a patient who does not have thirdparty coverage from a health insurer, health care service plan, 

Medicare, or Medicaid, and whose injury is not a compensable 

injury for purposes of workers’ compensation, automobile 

insurance, or other insurance . . . . Self-pay patients may include 

charity care patients.” (Health & Saf. Code, § 127400, subd. (f).)
4

alternate request for certification of an issue class, limited to the 

question whether Dignity Health’s admissions contract included 

an “open price” term. 

We exercise our inherent authority to modify the class

definition, combining elements of the definition in Sarun’s third 

amended complaint and his motion for class certification and 

limiting it to uninsured individuals who, during the relevant time 

period, received emergency care at Northridge Hospital Medical 

Center and who signed (personally or through an authorized 

agent) the admissions contract and were thereafter directly billed 

for that treatment at chargemaster rates or chargemaster rates 

less the uninsured discount. As to that redefined class, we 

reverse in part the trial court’s order denying class certification

and direct it to certify as a class issue whether Dignity Health’s 

admissions contract contains an open price term, so that patients

within the class are obligated to pay no more than the reasonable 

value of the services provided.

FACTUAL AND PROCEDURAL BACKGROUND

1. Sarun’s Emergency Room Treatment and the Admissions 

Contract

According to the allegations of the third amended 

complaint, Sarun was taken by ambulance to the emergency 

room at Northridge Hospital Medical Center following a motor 

vehicle accident. He was released three to four hours later after 

being examined and receiving various diagnostic tests. 

While at the hospital Sarun signed a standard form 

“Conditions of Admissions and Treatment,” which included terms 

governing payment for services. Paragraph 8(b) of the 

admissions contract stated, “Patients who do not have insurance 

must pay us for the services at our full charges, unless other 
5

discounts apply. However, uninsured patients may be able to 

qualify for government programs or financial assistance. 

Financial assistance may include a discount from the Hospital’s 

full charges, free care, interest free payment plans or other 

assistance. Patients seeking government or financial assistance 

must complete an application.” The term “full charges” was 

defined at the beginning of the agreement as “the Hospital’s 

published rates (called the chargemaster), prior to any discounts 

or reductions.” Paragraph 9, “Financial Assistance,” explained 

the hospital could help uninsured patients enroll in government 

health care programs, and, if the patient did not qualify, might 

provide financial assistance under its own financial assistance 

policy. 

Sometime following his treatment, Sarun received a 

“Balance Due Notice,” reflecting total charges of $31,359, the 

chargemaster rate; an uninsured discount of $7,871.10; and a 

balance due of $23,487.90. The invoice stated, in addition to the 

uninsured discount, “you may be eligible for other forms of 

financial assistance such as government sponsored programs” 

and provided a telephone number for further information. A 

document included with the invoice described the financial 

assistance options, provided an application and enumerated the 

necessary documentation. (See Sarun v. Dignity Health (2014) 

232 Cal.App.4th 1159, 1163.)4 Sarun did not seek any further 

discount or apply for financial assistance. (Ibid.) However, a 

second invoice was sent to Sarun, showing that a “prompt pay” 

4

In Sarun v. Dignity Health, supra, 232 Cal.App.4th 1159 

we held Sarun had standing under the UCL to challenge Dignity 

Health’s billing practices for uninsured emergency care patients.
6

discount would reduce the balance due to $15,648.15 if he paid 

the total within 30 days.5

2. The Chargemaster List of Billable Medical Goods and 

Services

Northridge Hospital Medical Center, like hospitals across 

the country, uses a charge description master or “chargemaster,” 

which is a list of all the billable medical goods or services 

provided by the hospital. (See Health & Saf. Code, § 1339.51, 

subd. (b)(1) [“‘[c]harge description master’ means a uniform 

schedule of charges represented by the hospital as its gross billed 

charge for a given service or item, regardless of payer type”].) As 

explained by Dignity Health, a chargemaster is a list, “generally 

contained in a spreadsheet, of every single patient-billable item 

or service available at a particular hospital. . . . The 

Chargemaster identifies each of these items and contains charge 

descriptions, billing codes, prices, and other information 

necessary for patient care and billing.” Each of Dignity Health’s 

hospitals had its own chargemaster; each hospital set its own 

prices for items and services on its chargemaster list; and 

“[p]rices and markups over ‘cost,’ vary widely not only by hospital 

but also by item or service. . . . Prices for procedures will vary 

with a number of factors, including staff resources, equipment 

resources, costs incurred related to the procedure and time 

elements.” Indeed, as the Supreme Court observed, 

“Chargemaster prices for a given service can vary tremendously, 

5 Additional invoices sent to Sarun further reduced the 

balance due to just over $4,000 based on Dignity Health’s patient 

payment assistance policy and financial information Sarun 

provided in his deposition testimony.
7

sometimes by a factor of five or more, from hospital to hospital in 

California.” (Howell v. Hamilton Meats & Provisions, Inc. (2011) 

52 Cal.4th 541, 561 (Howell).) 

A hospital is not prohibited from using its chargemaster for 

billing purposes (see Health & Saf. Code, § 127444) and is 

authorized to negotiate and charge alternative rates (see Bus. & 

Prof. Code, § 16770, subd. (f)). As Dignity Health acknowledges, 

contracts between hospitals and commercial insurance companies 

include a variety of negotiated price terms for different services 

and supplies, including percentage discounts from chargemaster 

rates, flat fees for certain services, per diem rates, “not to exceed” 

pricing and special payment terms for specific services such as 

trauma or burn care. 

A hospital’s chargemaster must be posted on its website or 

made available at the hospital’s physical location (Health & Saf. 

Code, § 1339.51, subd. (a)(1)) and must be filed with California’s 

Office of Statewide Health Planning and Development (see 

Health & Saf. Code, § 1339.55), which makes chargemasters 

available to the public on its website.

3. Sarun’s Third Amended Complaint

Sarun’s third amended complaint alleges causes of action 

under the UCL and the CLRA and for declaratory relief under 

Code of Civil Procedure section 1060.6 Addressing uninsured 

emergency care patients at Dignity Health generally and the 

32 acute-care hospitals it owned or operated throughout 

California, not at just Northridge Hospital Medical Center, Sarun 

alleged Dignity Health used the same adhesive admissions 

6

Statutory references are to this code unless otherwise 

stated.
8

contract at all its hospitals and required all emergency care 

patients or their agents to sign it. Sarun further alleged the 

admissions contract contains “no fixed or definite pricing terms” 

because the phrase “full charges, unless other discounts apply” is 

inadequately explained and cannot be made certain. Accordingly, 

the admissions contract has an open price term, obligating

patients to pay only the reasonable value of the care received. 

Alternatively, Sarun alleges Dignity Health’s chargemaster 

prices are several times greater than the reasonable value of the 

services provided, as well as the reimbursement amounts 

received from other categories of patients, and bear no relation to 

the hospital’s actual costs for providing treatment or services. As

a result, the chargemaster prices, if billed to an uninsured 

emergency care patient, are unconscionable. 

Sarun alleged he was bringing his action pursuant to Code 

of Civil Procedure section 382 and Civil Code section 1781 on 

behalf of himself and a class of all other persons similarly 

situated, defined as, “All individuals (or their guardians or 

representatives) who, on or after May 3, 2008, (a) received 

emergency care medical treatment at a Dignity hospital in

California; (b) were not covered by commercial insurance or 

governmental healthcare programs at the time of treatment; and 

(c) were not given a payment assistance discount under Dignity's 

Payment Assistance Po1icy.”7 He further alleged Dignity Health 

had acted or refused to act on grounds generally applicable to all 

7

 Sarun excluded from the class definition “Defendant and 

Defendant’s hospitals, any officers or directors thereof, together 

with the legal representatives, heirs, successors, or assigns of any 

of Defendant’s hospitals, and any judicial officer assigned to this 

matter and his or her immediate family.”
9

members of the class, making final injunctive or declaratory 

relief appropriate for the class as a whole.

For his UCL cause of action, Sarun alleged Dignity 

Health’s conduct was both unfair and deceptive because the 

prices charged “were unduly excessive, were not disclosed or 

readily available to Dignity’s patients, and the parties had 

unequal bargaining powers that led Sarun and the Class 

members to enter into their Contracts without knowledge of their 

terms.” Sarun also alleged Dignity Health’s practices toward its 

uninsured emergency care patients were deceptive because it

failed to disclose that those patients would be required to pay 

approximately three times more than other patients signing the 

same admissions contract and receiving the same treatment and 

services.

For his CLRA cause of action, Sarun alleged Dignity Health 

misrepresented the characteristics, uses and benefits of the 

services it provided (including by representing it provides 

“affordable” care at the “lowest possible cost”) and advertised its

services with an intent not to sell them as advertised.

Sarun’s third cause of action for declaratory relief sought a 

declaration that Dignity Health’s billing practices as they relate 

to class members are “unfair, unconscionable, and/or 

unreasonable.” He also sought a declaration that Dignity 

Health’s admissions contract “contains an ‘open price’ term with 

respect to self-pay emergency care patients and thus [they] are 

liable to [Dignity Health] for no more than the reasonable value 

of the treatment/services provided.”
10

4. Sarun’s Motion for Class Certification; Dignity Health’s 

Opposition

On June 26, 2017 Sarun moved for certification of a class 

for purposes of his cause of action for declaratory relief, 

redefining the proposed class as “all individuals who, from 

March 1, 2011 to the date of class certification, received 

treatment at Northridge Hospital Medical Center and who were 

directly billed for such treatment at Chargemaster rates or 

Chargemaster rates less an ‘uninsured discount,’ on one or more 

occasions. (For purposes of this action, patients who were 

‘directly billed’ means the patient or, where applicable, the 

patient’s legal guardian.)”8 As in his third amended complaint,

Sarun described two primary theories of liability on behalf of his 

putative class. First, the admissions contract contains an open 

price term: It does not adequately incorporate the chargemaster

and its rates; and, even if it did, the price for services is not 

readily ascertainable because the various potential discounts that 

may be applied to reduce the actual bill received by patients are 

not reflected on the face of the chargemaster or otherwise 

disclosed in the admissions contract. Second, the chargemaster 

rates, even after the uninsured discount, are unconscionable. 

Under either theory, Sarun contended, class members are liable 

only for the reasonable value of the services they received. In the 

alternative, pursuant to California Rules of Court, rule 3.765(b)

(rule 3.765(b)),

9

Sarun requested certification of the class limited 

to the issue whether the admissions contract contains an open 

price term. 

8

The proposed class definition again excluded “any officers 

or directors of Defendant, together with the legal representatives, 
11

In his motion Sarun argued the class was numerous, citing 

evidence that, between April 1, 2011 and March 31, 2017, there 

were more than 38,000 emergency room visits at Northridge 

Hospital Medical Center by self-pay patients, although Sarun 

acknowledged that not all those patients were necessarily 

directly billed at chargemaster rates or chargemaster rates less 

the uninsured discount. Sarun next contended the element of 

commonality was satisfied since all class members were subject 

to the same language in their admissions contract. He then

presented evidence that his claims were typical of the claims of 

the class and that he and his counsel would adequately protect 

the class. 

Relying on standards applied by federal courts when 

evaluating proposed class actions under rule 23(b)(1) and (b)(2) of 

the Federal Rules of Civil Procedure (28 U.S.C.), Sarun argued

ascertainability of the proposed class, the predominance of 

common questions of fact or law and the superiority of the class 

action device, all generally required for certification of a class 

action under state law, were not necessary for the type of classwide declaratory relief he was seeking. Nonetheless, while 

maintaining it was not required, Sarun asserted the proposed 

class was ascertainable because it described a set of common 

characteristics that were sufficient to allow a member of the class 

to identify himself or herself as having a right to recover based on 

heirs, successors, or assigns of Defendant, and any judicial officer 

assigned to this matter and his or her immediate family.”

9 Rule 3.765(b) provides, “When appropriate, an action may 

be maintained as a class action limited to particular issues. A 

class may be divided into subclasses.”
12

the class definition; he specifically argued the administrative 

feasibility of individually identifying class members should not be 

part of the ascertainability determination. Similarly, although 

not required, Sarun contended common issues predominated over 

individual issues because Dignity Health used a standard form, 

adhesive contract, and “only a contract interpretation by the 

Court is sought herein.” And, while insisting he did not need to 

demonstrate a class action was the superior means to pursue this 

litigation, Sarun argued a class action was needed for a fair and 

efficient adjudication of the issues presented. 

In its opposition Dignity Health argued, except for 

numerosity, Sarun’s putative class failed to meet any of the 

requirements for a California class action. In particular, Dignity 

Health emphasized the ascertainability element of the class 

certification analysis, submitting evidence concerning its records 

systems and billing practices to support its argument that a 

manual review of each individual patient account would be 

necessary to determine who was included within the proposed 

class. Dignity Health also submitted an expert declaration 

explaining that no uniform determinations could be made 

regarding the reasonableness (or unconscionability) of 

chargemaster rates; any such analysis would be intensely factspecific and not amenable to common proof. Thus, Dignity 

Health insisted, individual issues overwhelmed the few common 

issues identified by Sarun. The opposition papers did not address 

Sarun’s alternate request for a limited issue class.

5. The Trial Court’s Order Denying Class Certification

Following a hearing on December 7, 2017 the trial court 

entered its order denying class certification. The court rejected 

Sarun’s argument the certification issue should be evaluated 
13

under standards governing federal class actions and ruled, 

although the requirement of numerosity had been met, the 

proposed class was not ascertainable, individual issues 

predominated over common issues and a class action was neither 

manageable nor the superior method for litigating the dispute. 

Focusing initially on the question of ascertainability, the 

court summarized at length information provided by Dignity 

Health’s director of revenue cycle management concerning 

collection and maintenance of patient information. The court

found ascertainment of members of the class as defined would 

require manual review of data, which “would be extremely 

expensive and time consuming.” Accordingly, the court concluded 

the proposed class definition “‘runs afoul of the requirement that 

class members be “readily identified without unreasonable 

expense or time by reference to official records,’” citing Thompson 

v. Automobile Club of Southern California (2013) 217 Cal.App.4th 

719, 728, a case that has subsequently been disapproved in part 

in Noel v. Thrifty Payless, Inc. (2019) 7 Cal.5th 955, 986, fn. 15

(Noel) [disapproving the standard quoted by the superior court 

from Thompson “insofar as it could be perceived as exclusive”; 

“this is one way but not the only way to show an ascertainable 

class”].)

With respect to predominance of common or separate 

issues, the court rejected Sarun’s disclaimer of any need to 

determine the reasonable value of the various services and 

procedures on the chargemaster in connection with the request

for declaratory relief.10 To declare Dignity Health could not 

10 Sarun insisted his request for declaratory relief only 

required a determination that the admissions contract contained 

an open price term and that, as a result, Dignity Health could 
14

utilize the chargemaster rates, the court reasoned, would 

necessarily require it to determine whether those rates 

represented the reasonable value of the services at issue: “As 

such, the reasonableness of thousands of chargemaster rates 

must be considered at trial.” Moreover, the court observed that 

without a determination of what reasonable value is and whether 

chargemaster rates less the uninsured discount exceeded that 

reasonable value, “this case would have only limited utility as 

future litigation as to the amount owed would still be necessary, 

in contravention of one of the fundamental purposes of 

declaratory relief.” Sarun’s alternate theory, that the 

chargemaster rates or chargemaster rates less uninsured 

discount are unconscionable, the court continued, has the same 

problem of individual issues overwhelming any common 

questions presented.

The need to decide whether individual items on the 

chargemaster were appropriately priced and whether the charges 

for particular patients were unconscionable in order to resolve 

the ultimate issue of Dignity Health’s liability, the court further 

found, demonstrated that a class action was neither manageable 

nor the superior method for handling the litigation.

In a final section of its order, the trial court observed that 

Sarun’s claims may be not be typical of the class and he may not 

only recover the reasonable value of the services and treatment 

provided. According to Sarun, Dignity Health would have to 

establish the reasonable value of particular services and 

treatments, not in this lawsuit, but in separate litigation against 

each class member for whom it sought to collect unpaid invoices. 
15

be an adequate class representative.

11

 However, the court 

declined to deny class certification on that basis: “Having 

already determined that ascertainability, commonality, and 

manageability/superiority have not been shown, there is no need 

to decide adequacy or typicality at this junction.”12

Sarun filed a timely notice of appeal. (See In re Baycol 

Cases I & II (2011) 51 Cal.4th 751, 762 [“an order that denies 

class certification or otherwise extinguishes class claims in their 

entirety is appealable, but only in cases in which individual 

claims survived”]; Cortez v. Doty Bros. Equipment Co. (2017) 

15 Cal.App.5th 1, 8.)

11 Dignity Health argued in its opposition papers, because 

Sarun had refused to communicate with it regarding his bill and 

actively avoided seeking financial assistance, his claims were not 

typical (if, indeed, there were any “typical” claims within the 

proposed class). It also asserted, because Sarun had received 

substantial discounts and financial assistance from Dignity 

Health, he was not even a member of the class and not an 

adequate representative for it.

12 In its tentative ruling, which is substantially similar to its 

final order denying class certification, the court had stated, “For 

all the reasons already articulated, Sarun’s request for 

certification in the alternative pursuant to Cal. Rule of Court, 

Rule 3.765(b) is denied.” The final order, however, contains no 

reference to Sarun’s request for a rule 3.765(b) limited issue 

class. (Cf. Silverado Modjeska Recreation & Park Dist. v. County 

of Orange (2011) 197 Cal.App.4th 282, 300 [“the court’s final 

order supersedes the tentative ruling”].) 
16

DISCUSSION

1. Governing Law and Standard of Review

Class actions are statutorily authorized “when the question 

is one of a common or general interest, of many persons, or when 

the parties are numerous, and it is impracticable to bring them 

all before the court . . . .” (§ 382.) The party seeking class 

certification must establish (1) “the existence of an ascertainable 

and sufficiently numerous class”; (2) “a well-defined community 

of interest”; and (3) “substantial benefits from certification that 

render proceeding as a class superior to the alternatives.” 

(Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 

1004, 1021 (Brinker); accord, Noel, supra, 7 Cal.5th at p. 968.) 

“The community of interest requirement involves three factors: 

‘(1) predominant common questions of law or fact; (2) class 

representatives with claims or defenses typical of the class; and 

(3) class representatives who can adequately represent the 

class.’” (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435; 

accord, Noel, at p. 968; Brinker, at p. 1021.)13

“The certification question is ‘essentially a procedural one’” 

(Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 

319, 326 (Sav-On)) that examines “whether the theory of recovery 

advanced by the proponents of certification is, as an analytical 

matter, likely to prove amenable to class treatment” (id. at 

13 The CLRA includes its own set of requirements for class 

certification under Civil Code section 1781. (See Noel, supra, 

7 Cal.5th at p. 969.) Because Sarun sought class certification 

only for his declaratory relief cause of action, any differences 

between the requirements for class certification under Code of 

Civil Procedure section 382 and Civil Code section 1781 are not 

pertinent to this appeal.
17

p. 327). A certification motion “‘does not ask whether an action is 

legally or factually meritorious’ [citation],” but rather whether 

the common issues it presents “‘are so numerous or substantial 

that the maintenance of a class action would be advantageous to 

the judicial process and to the litigants.’” (Id. at p. 326.) The 

court must assume the class claims have merit and resolve 

disputes regarding the claims’ merits only when necessary to 

determine whether an element for class certification is satisfied. 

(Brinker, supra, 53 Cal.4th at pp. 1023-1025.) “‘As a general rule 

if the defendant’s liability can be determined by facts common to 

all members of the class, a class will be certified even if the 

members must individually prove their damages.’” (Id. at 

pp. 1021-1022; see Sav-On, at p. 334 [“‘the necessity for class 

members to individually establish eligibility and damages does 

not mean individual fact questions predominate’”].)

A trial court is generally afforded great latitude in granting 

or denying class certification, and we normally review a ruling on 

certification for an abuse of discretion. (Sav-On, supra,

34 Cal.4th at pp. 326-327; see Brinker, supra, 53 Cal.4th at 

p. 1022 [“‘[b]ecause trial courts are ideally situated to evaluate 

the efficiencies and practicalities of permitting group action, they 

are afforded great discretion in granting or denying 

certification’”].) This deferential standard of review, however, is 

inapplicable if the trial court has evaluated class certification 

using improper criteria or an incorrect legal analysis: “[A] trial 

court ruling supported by substantial evidence generally will not 

be disturbed ‘unless (1) improper criteria were used [citation]; or 

(2) erroneous legal assumptions were made.’” (Sav-On, at 

pp. 326-327; accord, Noel, supra, 7 Cal.5th at p. 968; Fireside 

Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089.) In 
18

conducting our review, we consider only the grounds articulated 

by the trial court for its certification decision: “We review the 

trial court’s actual reasons for granting or denying certification; if 

they are erroneous, we must reverse, whether or not other 

reasons not relied upon might have supported the ruling.” (Ayala 

v. Antelope Valley Newspapers, Inc. (2014) 59 Cal.4th 522, 530; 

accord, Franchise Tax Bd. Limited Liability Corp. Tax Refund 

Cases (2018) 25 Cal.App.5th 369, 388; Alberts v. Aurora 

Behavioral Health Care (2015) 241 Cal.App.4th 388, 399.)

2. The Trial Court Used an Unduly Restrictive Standard

To Evaluate the Proposed Class’s Ascertainability

As discussed, after summarizing portions of the declaration 

submitted by Dignity Health’s director of revenue cycle 

management concerning the manner in which a patient’s billing 

and insurance information may change over time, the trial court 

observed, “While the class definition appears straightforward on 

its face (either a person received treatment at Northridge 

Hospital and was billed at chargemaster rates, or chargemaster 

rates with uninsured discounts, or not), the actual determination 

of persons who were billed at such rates is not clearly or easily 

determined.” To the contrary, the court determined, “[t]here does 

not appear to be any way to ascertain who is actually in the class 

without manual review of [the] data.” Because class members 

could not be “‘readily identified without unreasonable expense or 

time by reference to official records,’” the court concluded, Sarun 

had failed to establish the class can be ascertained, obligating the 

court to deny class certification. The trial court justified its use of 

this restrictive ascertainability standard by explaining, “The 

primary purpose of the ascertainability requirement is to provide 
19

notice to all potential class members as to whom the judgment in 

the action will be res judicata.” 

Shortly after the trial court’s decision denying class 

certification, the Supreme Court in Noel, supra, 7 Cal.5th 955 

disapproved the stringent approach to ascertainability utilized by 

the trial court here and articulated in numerous court of appeal 

decisions “insofar as it could be perceived as exclusive.” (Id. at 

p. 986, fn. 15.)14 Instead, the Court held the threshold 

requirement of ascertainability for class certification is satisfied 

when the class “is defined ‘in terms of objective characteristics 

and common transactional facts’ that make ‘the ultimate 

identification of class members possible when that identification 

becomes necessary.’ [Citation.] We regard this standard as 

including class definitions that are ‘sufficient to allow a member 

of [the class] to identify himself or herself as having a right to 

recover based on the [class] description.’” (Id. at p. 980.)

With respect to the concerns for the feasibility of personal 

notice underlying use of a more restrictive standard, the Noel

Court held, “[D]ue process does not invariably require that 

personal notice be directed to all members of a class for a class 

action to proceed, or for that matter that an individual member of 

a certified class must receive notice to be bound by a judgment. 

[Citations.] It follows that a construction of the ascertainability 

requirement that presumes such notice is necessary to satisfy due

14 The Court noted a number of court of appeal decisions 

applying this standard, including several from this division, had 

determined the identity of the class was ascertainable, “a 

conclusion that did not necessarily rule out other avenues for 

showing an ascertainable class.” (Noel, supra, 7 Cal.5th at 

p. 974, fn. 8.)
20

process, and demands that the plaintiff show how it can be 

accomplished, threatens to demand too much, too soon. It is 

likewise mistaken to take a categorical view that the relevant 

due process interests can be satisfied only when ‘official records’ 

[citation] supply the means of identifying class members, and for 

a similar reason: due process is not that inflexible.” (Noel, supra, 

7 Cal.5th at p. 984.) The Court further explained, “Our 

jurisprudence addressing class certification has stressed the 

importance of a careful weighing of both the benefits and the 

burdens that may be associated with a proposed class action. 

[Citation.] A conception of ascertainability as concerned with 

whether class members can be identified without an 

unreasonable commitment of expense or time is at cross purposes 

with this direction.” (Id. at p. 985.) 

It follows from the Supreme Court’s holding and analysis in 

Noel that the trial court erred when it found no ascertainable 

class existed.15 As the trial court observed, the class definition is 

straightforward on its face: It is defined in objective terms—

patients who received treatment at Northridge Hospital Medical 

Center and were billed for such treatment at chargemaster rates 

15 We reject any suggestion the ascertainability requirement,

as most recently articulated in Noel, supra, 7 Cal.5th 955, does 

not apply to California class actions that are the equivalent of a 

class action under rule 23(b)(1) or (b)(2) of the Federal Rules of 

Civil Procedure (28 U.S.C.). (See Hefczyc v. Rady Children’s 

Hospital-San Diego (2017) 17 Cal.App.5th 518, 535 [“there is no 

gap in California precedent to be filled by reference to Federal 

Rules of Civil Procedure, rule 23(b)(1)(A) or (2) (28 U.S.C.) on the 

issue of what class certification standards must be met when a 

plaintiff seeks only declaratory or injunctive relief on behalf of a 

class”], disapproved on other grounds in Noel, at p. 986, fn. 15.)
21

or chargemaster rates less an uninsured discount—that are, in 

the language of Noel, “‘“sufficient to allow a member of [the class] 

to identify himself [or herself] as having a right to recover based 

on the [class] description.”’” (Noel, supra, 7 Cal.5th at p. 980.)16 

“To the extent that the trial court had concerns regarding the 

state of the record as it pertained to matters such as the 

provision of notice to class members or how burdensome it would 

be to identify class members, those issues should not have been 

resolved in the context of ascertainability.” (Id. at p. 987; 

cf. Hicks v. Kaufman & Broad Home Corp. (2001) 89 Cal.App.4th 

908, 915.)

3. The Trial Court Misperceived Sarun’s Primary Theory of 

Liability in Evaluating Whether Common Issues of Law 

or Fact Predominate

Although the trial court acknowledged its responsibility to 

assess whether common issues predominate by considering the 

method by which the putative class representative seeks to 

impose liability, it incorrectly defined Sarun’s principal claim for 

declaratory relief and thereby erred in its analysis of the common 

16 In articulating the correct standard for determining 

ascertainability, the Supreme Court disapproved of the analysis 

in Hefczyc v. Rady Children’s Hospital–San Diego, supra,

17 Cal.App.5th 518, Kendall v. Scripps Health (2017) 

16 Cal.App.5th 553 and Hale v. Sharp Healthcare (2014) 

232 Cal.App.4th 50, cases relied upon by the trial court and by 

Dignity Health on appeal that denied class certification in 

lawsuits challenging the use of chargemaster rates for uninsured 

patients. (Noel, supra, 7 Cal.5th at p. 986, fn. 15.) In each of 

those cases the lack-of-ascertainability finding was a significant 

factor in the court’s related findings that individual issues 

predominated. 
22

issue question. According to the trial court, Sarun was seeking a 

declaration (1) that Dignity Health’s standard form admissions 

contract contained an open price term, permitting it to directly 

bill patients only for the reasonable value of the treatment or

services provided; and (2) that the chargemaster rates actually 

used at Northridge Hospital Medical Center (or the chargemaster 

rates less an uninsured discount) are unreasonable. Because 

trying that issue would require consideration of the 

reasonableness of thousands of individual chargemaster rates, 

the court reasoned, those individual issues overwhelmed the 

common contract interpretation issue presented.

As Sarun repeatedly emphasized, however, as to this

theory of liability, which also is the basis for his alternate request 

for certification of a limited issue class under rule 3.765(b), he 

seeks only a declaration that Dignity Health’s admissions 

contract included an open price term and that Northridge 

Hospital Medical Center may only directly bill patients the 

reasonable value of the treatment received or services provided. 

If Sarun’s contract interpretation theory is correct, whether a 

particular chargemaster rate, or chargemaster rate less 

uninsured discount, in fact, represents the reasonable value of 

the treatment or service provided would be determined, if at all, 

in separate litigation between Dignity Health and directly billed 

patients from whom it seeks to collect unpaid invoices. Since it 

appears to be undisputed on this record that patients are all 

required to sign an identical form admissions contract at 

Northridge Hospital Medical Center, Sarun’s theory of liability 

included no individual issues.

In contrast, the second prong of Sarun’s request for

declaratory relief—a declaration the chargemaster rates or 
23

chargemaster rates less the uninsured discount are 

unconscionable—would, as the trial court found, necessarily 

require a determination whether those rates represent the 

reasonable value of the hospital’s services. (See Hefczyc v. Rady 

Children’s Hospital–San Diego (2017) 17 Cal.App.5th 518, 544 

[“[t]o issue a declaration that Rady is not permitted to bill based 

on its Chargemaster rates and that its billing practices are 

unconscionable, the trial court would be required to decide 

whether each and every item on Rady’s Chargemaster represents 

the reasonable value of Rady’s services provided to individual 

patients in any given year. That determination does not present

a common issue amenable to a simple class-wide declaration”], 

disapproved on another ground in Noel, supra, 7 Cal.5th at 

p. 986, fn. 15.)

Sarun disputes this reasoning, insisting he intends to prove 

any use of chargemaster rates by Dignity Health is 

unconscionable based on statistical evidence that will involve an 

overall comparison of chargemaster rates to the aggregate cost to 

Dignity Health of providing treatment and services and the 

average reimbursements received by Dignity Health from all 

types of payors. Sarun’s argument fundamentally 

misapprehends the nature of an unconscionability finding. As 

the Supreme Court has explained, when a price term is alleged to 

be substantively unconscionable, “it is not sufficient for a court to 

consider only whether ‘the price exceeds cost or fair value.’” 

(De La Torre v. CashCall, Inc. (2018) 5 Cal.5th 966, 983.) Rather, 

the evaluation of substantive unconscionability “is highly 

dependent on context. [Citation.] The doctrine often requires 

inquiry into the ‘commercial setting, purpose, and effect’ of the 

contract or contract provision.” (Sanchez v. Valencia Holding Co., 
24

LLC (2015) 61 Cal.4th 899, 911.) “‘[A] contract can provide a 

“margin of safety” that provides a party with superior bargaining 

strength a type of extra protection for which it has a legitimate 

commercial need without being unconscionable.’” (Armendariz v. 

Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 

117.)

In addition, “unconscionability requires oppression or 

surprise—that is, procedural unconscionability—along with the 

overly harsh or one-sided results that epitomize substantive 

unconscionability. . . . Even where a party complains of a single

contract clause, the court usually must still examine the 

bargaining process for any procedural unfairness.” (De La Torre 

v. CashCall, Inc., supra, 5 Cal.5th at p. 982.) Accordingly,

determining whether billing with chargemaster rates is 

unconscionable will require not only an evaluation of specific 

charges within the overall context of Dignity Health’s economic 

and commercial situation but also an analysis of individual 

factors relating to a particular patient—for example, was he or 

she conscious or unconscious upon arrival at the hospital; was he 

or she a returning patient who was familiar with Dignity 

Health’s billing process; was he or she indigent or insured but 

subject to policy exclusion? As to all of these questions, 

individual issues necessarily predominate. 

In sum, the trial court’s decision that common issues do not 

predominate with respect to Sarun’s request for certification of a 

class to pursue his cause of action for declaratory relief in its 

entirety is supported by substantial evidence. (Cf. Howell, supra, 

52 Cal.4th at p. 561 [“[w]e do not suggest hospital bills [based on 

chargemaster rates] always exceed the reasonable value of the 

services provided”].) However, its implicit finding with respect to 
25

the limited issue class that the common issue of contract 

interpretation raised by Sarun is outweighed by individual

questions of fact is not. (See La Sala v. American Sav. & Loan 

Assn. (1971) 5 Cal.3d 864, 877 [“[c]ontroversies involving widely 

used contracts of adhesion present ideal cases for class 

adjudication; the contracts are uniform; the same principles of 

interpretation apply to each contract, and all members of the 

class will share a common interest in the interpretation of an 

agreement to which each is a party”].) As discussed, there are no 

individual issues raised by this limited request for declaratory 

relief.

4. Substantial Evidence Supports the Trial Court’s Finding 

the Class Definition As Proposed in the Certification 

Motion May Not Be Manageable, but a More Limited 

Class Is Properly Certified

The trial court predicated its finding that Sarun had not 

demonstrated the manageability of the individual issues raised 

by his proposed class action or that a class action was a superior 

method for resolving the litigation on its misconception of Sarun’s 

primary theory of liability. To determine whether the admissions 

contract should be set aside, the court explained, it would be 

required to determine not only whether it contains an open price 

term but also, if it does, what the reasonable charges are for the 

treatment received by each uninsured patient and, if it does not,

whether the chargemaster rates (or chargemaster rates less the 

uninsured discount) as billed are unconscionable. As discussed, 

however, certifying a rule 3.765(b) limited issue class creates 

neither difficulty for the trial court. 

Moreover, although the trial court correctly observed that 

answering the open-price-term question would not fully resolve 

class members’ ultimate liability to Dignity Health, it erred in 
26

suggesting there was no utility in deciding this threshold issue. 

To the contrary, settling this issue could significantly expedite

final determination of any outstanding billing disputes. (See 

Meyer v. Sprint Spectrum L.P. (2009) 45 Cal.4th 634, 647 [“‘“[t]he 

purpose of a declaratory judgment is to ‘serve some practical end 

in quieting or stabilizing an uncertain or disputed jural 

relation’”’”].) If Sarun’s interpretation of the admissions contract 

is upheld, Dignity Health could not assert that uninsured 

patients are contractually bound to pay chargemaster rates less 

discounts without regard to whether those rates are reasonable.17 

If it is rejected, as to all class members bound by the judgment

Dignity Health need only defend the rates charged against the 

claim they are unconscionable, a quite different issue with a 

different party bearing the burden of proof. (Cf. Sanchez v. 

Valencia Holding Co., LLC, supra, 61 Cal.4th at p. 911 

[“[b]ecause unconscionability is a contract defense, the party 

asserting the defense bears the burden of proof”].) In addition, 

requiring class members to individually pursue the contract 

interpretation question, aside from its potential economic 

infeasibility, would create an unacceptable risk of inconsistent 

outcomes. 

Nonetheless, based on the evidence presented by Dignity 

Health’s director of revenue cycle management, the trial court, in 

17 We need not decide whether an open-price-term finding 

would shift to Dignity Health the burden of proving 

reasonableness in a contested collection action, as Sarun argues, 

or if the burden would remain with the patient to prove the 

charged amounts were unreasonable, as Dignity Health contends. 

In either case, resolving the open-price-term question will, as a 

practical matter, significantly advance any such litigation. 
27

evaluating the manageability of the proposed class proceeding, 

appropriately considered the difficulty and expense of identifying

absent class members and providing them with notice at an

appropriate time, if required. (See Noel, supra, 7 Cal.5th at 

p. 986.) This manageability problem, the trial court indicated, 

was exacerbated by a change in the proposed class definition

from that set forth in the third amended complaint: While the 

motion sought to certify a class limited to patients at Northridge 

Hospital Medical Center, rather than at any of Dignity Health’s 

facilities in California, Sarun no longer restricted his proposed 

class to uninsured emergency care patients, instead seeking to 

include all patients who received any treatment or services at 

Northridge Hospital Medical Center and were billed directly at 

chargemaster rates or chargemaster rates less an uninsured 

discount. The modified definition thus included not only 

uninsured emergency care patients but also those who utilized 

elective services and those treated as outpatients.

As we explained in Hicks v. Kaufman & Broad Home Corp., 

supra, 89 Cal.App.4th at page 916, courts are not limited to the 

class definition proposed in the certification motion. If necessary 

to preserve the case as a class action, a court may redefine the 

class to reduce or eliminate an ascertainability or manageability

problem.18 Here, restricting the class to uninsured emergency 

18 Although Hicks was addressing the court’s authority to 

redefine a class because of issues relating to ascertainability, the 

same reasoning applies to manageability concerns created by a

potentially overbroad class definition. (Cf. Noel, supra, 7 Cal.5th 

at p. 986 [court must give due consideration to how 

manageability concerns may be resolved before determining that 
28

care patients at Northridge Hospital Medical Center, that is, to 

the category of patients identified in Sarun’s operative pleading 

and at the single facility addressed in the certification motion, 

will greatly ease any manageability concerns with the 

rule 3.765(b) limited issue class that should be certified in this 

case.

DISPOSITION

The order denying class certification is reversed, and the 

cause remanded with directions to certify a modified issue class 

as described in this opinion. Sarun is to recover his costs on 

appeal.

PERLUSS, P. J.

We concur:

SEGAL, J.

FEUER, J.

practical difficulties in providing notice to absent class members 

weigh against class certification].)