Huyer v. Wells Fargo & Co.
295 F.R.D. 332
S.D. Iowa2013Background
- Wells Fargo services about nine million mortgages and uses Fidelity software to order drive-by inspections for certain delinquencies.
- An initial inspection is ordered after 45 days of delinquency, with subsequent inspections every 25–35 days while delinquency persists.
- Plaintiffs challenge Wells Fargo’s policy of indiscriminately ordering inspections as a potential RICO §1962(c) and UCL violation.
- Plaintiffs seek class certification for an injunctive relief class under Rule 23(b)(2) and RICO/UCL classes under Rule 23(b)(3).
- Defendants resisted the motion; a hearing was held on October 2, 2013, and the motion was fully submitted.
- Court grants the motion, certifying the proposed classes.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Commonality under Rule 23(a)(2) | Common injury from uniform policy | Individual inspections vary by borrower; no common answer | Commonality satisfied; policy applied uniformly supports common issue |
| Typicality under Rule 23(a)(3) | Named plaintiffs' claims arise from the same policy as class | Differences among class members undermine typicality | Typicality satisfied; claims stem from same policy |
| Article III standing (standing) | Castros have injury-in-fact; Huyers lack UCL standing but named plaintiffs have standing for RICO/UCL | Castros lack injury; Huyers insufficient causation for RICO | Castros have Article III standing; Huyers’ standing too; standing issue resolved in plaintiffs’ favor |
| Injunctive relief under Rule 23(b)(2) | Injunctive relief appropriate for uniform policy | Dukes precludes severing injunctive from monetary relief; cohesion unclear | Injunctive relief class certified under Rule 23(b)(2) despite Dukes; injunctive relief available to private RICO plaintiffs under Scheidler analysis |
| Predominance under Rule 23(b)(3) | Common evidence can prove RICO/UCL elements; reliance may be class-wide | Individualized proof for inspections, reliance, and standing destroys predominance | Predominance satisfied; common evidence supports RICO/UCL claims; class-wide proof feasible |
Key Cases Cited
- Ross v. RBS Citizens, N.A., 667 F.3d 900 (7th Cir. 2012) (common policy satisfied common questions of liability under a uniform practice)
- Bouaphakeo v. Tyson Foods, Inc., 2011 WL 3793962 (N.D. Iowa 2011) (distinguishable; uniform policy supported common question of liability)
- Neal v. Casey, 43 F.3d 48 (3d Cir. 1994) (class may allege common harm despite individual injuries)
- Marisol A. by Forbes v. Giuliani, 929 F. Supp. 662 (S.D.N.Y. 1996) (commonality by same harm theory in institutional policies)
- In re U.S. Foodservice Pricing Litig., 729 F.3d 108 (2d Cir. 2013) (circumstantial proof of reliance can be class-wide)
- Dukes v. Wal-Mart Stores, Inc., 131 S. Ct. 2541 (2011) (certification framework and commonality guidance post-Dukes)
- Scheidler v. National Organization for Women, 267 F.3d 687 (7th Cir. 2001) (injunctive relief available to private RICO plaintiffs supported by Scheidler)
- Wollersheim v. Religious Tech. Ctr., 796 F.2d 1076 (9th Cir. 1986) (injunctive relief not available to private RICO plaintiffs (contrasted in Scheidler))