Iola Favell v. University of Southern California
2:23-cv-00846
C.D. Cal.May 13, 2025Background
- Plaintiffs (Favell et al.) allege that USC (through its Rossier School of Education) misrepresented its U.S. News & World Report ranking by submitting incomplete and false data to artificially boost its rank, and then marketed this ranking to attract students.
- Plaintiffs claim this fraudulent scheme inflated tuition and induced students to pay more for online master's and doctoral programs.
- The relevant timeframe is 2009-2021, with the proposed class defined as those who enrolled in online MAT or Ed.D programs between August 2017 and January 2022 and paid (or were obligated to pay) tuition.
- The court previously held the term “top-ranked” is nonactionable puffery and denied USC’s Daubert motions to exclude plaintiffs’ experts.
- Plaintiffs moved for class certification under Rule 23(b)(3), seeking certification of a class and subclasses related to the online programs.
- This ruling is a tentative decision on class certification, focusing on whether the requirements of Federal Rule of Civil Procedure 23 are satisfied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Numerosity | Over 2,000 students affected; joinder impracticable. | Does not contest numerosity. | Numerosity satisfied. |
| Commonality | Common questions about USC’s data submissions and the impact on rankings. | No direct contest; argues more under predominance. | Commonality satisfied. |
| Typicality | Named plaintiffs subject to same fraudulent scheme as class. | Plaintiffs have unique defenses (educational malpractice, timing, loan forgiveness). | Typicality satisfied; defenses not unique or disqualifying. |
| Adequacy | Plaintiffs and counsel share class interest, no conflicts, vigorous prosecution. | No challenge. | Adequacy satisfied; class counsel appointed. |
| Predominance | Common issues of falsity, materiality, reliance, and price premium damages predominate. | Materiality, exposure, and injury require individual analysis. | Predominance satisfied; damages can be determined class-wide. |
| Superiority | No other similar litigation, efficiencies favor class action. | No challenge. | Superiority satisfied. |
Key Cases Cited
- Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) (rigorous analysis for class certification; commonality standard)
- Amgen Inc. v. Connecticut Ret. Plans & Tr. Funds, 568 U.S. 455 (2013) (merits questions only considered as they relate to Rule 23 prerequisites)
- Sali v. Corona Reg’l Med. Ctr., 909 F.3d 996 (9th Cir. 2018) (party seeking class treatment bears the burden of demonstrating appropriateness)
- Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) (commonality and typicality in class actions; Rule 23 standards)
- In re Tobacco II Cases, 46 Cal. 4th 298 (2009) (materiality and likelihood to deceive under UCL claims; class action suitability)
- Falcon v. Gen. Tel. Co. of Sw., 457 U.S. 147 (1982) (typicality and relationship of class representatives to class)
- Ellis v. Costco Wholesale Corp., 657 F.3d 970 (9th Cir. 2011) (difference between class certification and summary judgment, and tests for Rule 23)
- Ruiz Torres v. Mercer Canyons Inc., 835 F.3d 1125 (9th Cir. 2016) (predominance standard in Rule 23(b)(3) class actions)
- Meyer v. Portfolio Recovery Assocs., LLC, 707 F.3d 1036 (9th Cir. 2012) (plaintiff’s burden for class action certification)