Another new class member discovery decision: CashCall, Inc. v. Superior Court

In CashCall, Inc. v. Superior Court, ___ Cal.App.4th ___ (Jan. 24, 2008), the Court of Appeal (Fourth Appellate District, Division One) handed down another significant discovery-related opinion, holding that the trial court appropriately permitted "precertification discovery in a class action for the purpose of identifying class members who may become substitute plaintiffs in place of named plaintiffs who were not members of the class they purported to represent." Slip op at 2.

In so holding, the Court distinguished First American Title Ins. Co v. Superior Court (Sjobring), 146 Cal.App.4th 1564 (2007). In First American, the Court of Appeal (Second Appellate District, Division Three) refused to permit such discovery to "a class action representative plaintiff [who] is not – and never was – a member of the class he purports to represent" because, under the circumstances of that case, "the grant of such discovery would sanction an abuse of the class action procedure." Id. at 1566. In CashCall, the Court of Appeal found First American distinguishable:

Unlike in First American, we conclude the potential for abuse of the class action procedure is not significant in this case. In First American, the plaintiff essentially "appointed himself enforcement officer for the California Department of Insurance settlement agreement" and "piggybacked" his class action onto that settlement agreement (possibly to obtain attorney fees). (First American, supra, 146 Cal.App.4th at p. 1577.) That scenario appears to exemplify the classic type of abusive class action of which CashCall warns. However, those circumstances do not exist in this case. There is no state or other investigation, much less a settlement, involving CashCall's secret call monitoring program. Absent continuation of the instant class action, there likely will be no other investigation of CashCall's conduct or potential relief obtained by class members for its alleged violations of their privacy rights. Furthermore, because only CashCall has knowledge of which customers' calls were monitored, the plaintiffs cannot be faulted for filing a class action based on the suspicion their privacy rights may have been violated and only later learning from CashCall that their calls had not been monitored (and therefore they do not have standing). Accordingly, unlike in First American, the potential for abuse of the class action procedure in this case is minimal. Neither the reasoning nor the result in First American persuades us that the trial court in this case abused its discretion by granting the plaintiffs' motion for precertification discovery of the identities of class members. Rather, we conclude the trial court, in applying the Parris balancing test, did not abuse its discretion.

CashCall, slip op. at 34-35 (citing Parris v. Superior Court, 109 Cal.App.4th 285 (2003)).

The Court described the "Parris balancing test" as follows:

In deciding whether to order precertification discovery of the identities of potential class members, a "trial court must . . . expressly identify any potential abuses of the class action procedure that may be created if the discovery is permitted, and weigh the danger of such abuses against the rights of the parties under the circumstances."

Id. at 11. Whether to permit the discovery is within the trial court's discretion. Id. The Court rejected CashCall's proposed "bright-line rule," under which "a trial court [would be] required to deny a motion for precertification discovery, without applying the Parris balancing test and exercising its discretion to permit precertification discovery." Id. at 12 (footnote omitted). The Court explained:

Although we agree with the general principle that a plaintiff must have standing to assert a cause of action, we are not persuaded by CashCall's assertion in the context of class actions that standing of the original named plaintiff(s) at the beginning of the action is necessarily a requirement for continuation of the action. Rather, we conclude that a trial court, exercising its reasonable discretion in applying the Parris balancing test in the circumstances of a particular case, may order precertification discovery of the identities of class members (i.e., those with standing) who, when contacted, ultimately may elect to be substituted as named plaintiffs to continue prosecution of the class action on behalf of the class.

Id. at 13.

My prior posts on First American are here and here. Another recent discovery-related decision, handed down nine days before CashCall, is also of interest. My post on Puerto v. Superior Court (Wild Oats Markets, Inc.), ___ Cal.App.4th ___ (Jan. 15, 2008) (Second Appellate District, Division Seven) is available at this link.

Comments

[christian mueller]

Is there a class action lawsuit going on against cashcall? how can I become a part of it, I was mislead by them also

[Nekisha Lewis]

Cash Call is a rip off. They are also harassing me because I missed a payment. I just left the shelter and i am struggling. They will not allow me to make any arrangements at all. If there is a class action lawsuit, please count me in.
Thanks

[michael midelton]

I have a loan with cash call and would like to be part of the class action lawsuit also. Please contact me.

[Josh Swigart]

Last week the Court approved the letter which will be distributed to all class members by mail. I anticipate this letter being sent out within the next two weeks. Included in our class are approximately 532 affected California consumers. Based on the prior discovery order, the only information disclosed to Plaintiff's counsel was the loan numbers associated with the affected class members. If you believe you may have been monitored, please feel free to contact me directly with your loan number and I can see if you are on the list.
Joshua B. Swigart
Hyde & Swigart
411 Camino del Rio South, Ste. 301
San Diego, CA 92108
619-233-7770
619-297-1022 fax

[Yolanda H.]

Hello,
I have been the victim of harrassment by CashCall as well. I've paid back over $10,000 in principle off of a $10,000 loan. Due to cutbacks in my employment, I am no longer able to pay the $332 per month. I only started sending Cashcall $100 money orders last month, but they call me 10 times a day. They also call my job. I've closed my checking account and got a PO box, so they could no longer track me. I told them to communicate with me via my PO Box. I tried to work with them and just sent them my second money order of $100, but depsite my providing them with proof of my financial situation, they continue to harrass me for full monthly payments. I was told by a lawyer to take them to small claims court. But I want to wait and see what happens with this class action lawsuit. CashCall has not returned my money orders so far, so I assume they've cashed them. Either way, I'm not backing down! Since I have paid them over $10,000, I will pay them a FAIR INTEREST on the $10,000 and not a penny more! I would like to be a part of this lawsuit. However, I don't feel comfortable giving out my loan account number via the internet. Please understand, I just feel weary about who I can trust. Can anyone send me info about how I can participate in this lawsuit against CashCall? My email is [email protected].
Thanks and God Bless.

[Albert Ruiz]

I have a loan with Cash Call for $5000. I got a 7 year loan with an interest rate of 60% and am paying over $250 a month. Could you guys please help me.

[crystal]

my husband and I got a loan from cash call 2 years ago. it was for 1500. we were told that we would have a 57% interest rate. When we got the paperwork from them are interest rae went ti 99%. We made 3 years worth of payments and atill have a huge balance. I have tried to contact them and see if they would lower my interest rate and they refused. They have been taken the money out of our account plus extra when they didn't have permission. My husband and I had to close our bank account and we now own the bank money cause they kept trying to take money from an account that had nothing in it. These people need to be shut down and for the people who have already paid more then their balance hould not have to pay them anymore.

[eva merrick]

I, too, am interested in a class action against cash call. Please forward materials to [email protected]. Thank you.

[Angela Lee]

I would like to be a part of the class action suit my email address is [email protected].

[Danielle]

I was sent an email about the class action lawsuit but it was for their monitoring practices. According to the email, sent in September, there was no trial date set. Does anyone have any new info?