Mazzei v. Money Store, 288 F.R.D. 45

Mazzei sues The Money Store defendants on behalf of a purported class for breach of contract, TILA-related claims, and California consumer-law claims arising from alleged improper debt-collection fees.
Mazzei’s mortgage loan originated in 1994; loan was accelerated in March 2000 and Mazzei paid $61,147.32 in October 2000, after which he contends all related fees should have been refunded.
Defendants used Moss Codilis to send breach letters and Fidelity to assist with bankruptcies/foreclosures, with Fidelity invoicing and a 'technology and referral fee' structure embedded in the fees charged to borrowers.
A Bonus/Penalty Agreement with Fidelity created potential penalties for Fidelity if deadlines were missed, with some penalties not credited back to borrowers.
Mazzei proposed five class subgroups (Breach Letter Fee, Penalty Fee, Phantom Fee, Fee-Split, Post-Acceleration Late Fee); the court redefines into five classes and analyzes Rule 23 elements for each.
The court concludes several proposed classes fail Rule 23 requirements, but certifies two classes: the Fee-Split Class and the Post-Acceleration Late Fee Class, after adjusting definitions for misalignment and predominance.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the proposed class is a fail-safe class	Mazzei contends a broad class is appropriate as defined.	The class definition creates a fail-safe construct dependent on liability.	Fail-safe nature rejected; as defined, it contaminates certification and requires redefinition
Whether the five proposed classes can be maintained as separate Rule 23 classes	Each subgroup arises from distinct factual theories and should be separately certified.	Subgroups raise intertwined issues that impede class-wide treatment.	Court restructures into five classes, each evaluated under Rule 23 separately
Breach Letter Fee Class commonality/typicality/adequacy	Mazzei’s breach-letter claim is representative of improper attorneys’ fees.	Authorship of Mazzei’s breach letter is contested; unique defenses apply.	Class fails commonality/typicality/adequacy; Mazzei not shown to be member or representative
Penalty Fee Class viability	Penalties related to Fidelity refunds reflect improper fee handling across borrowers.	Mazzei lacks completed foreclosure/bankruptcy; inapplicable to his loan; no shared policy shown	Penalty Fee Class fails Rule 23; Mazzei is atypical and inadequate representative
Phantom Fee Class viability	Some borrowers were charged phantom fees not paid to Fidelity or attorneys.	No uniform policy shown; substantial individualized inquiries required	Phantom Fee Class fails commonality/predominance; Mazzei not representative

Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (Supreme Court 2011) (affirmative demonstration of Rule 23 requirements; commonality standard)
In re IPO, 471 F.3d 24 (2d Cir. 2006) (class certification standards; predominance considerations)
Teamsters Local 445 Freight Div. Pension Fund v. Bombardier, Inc., 546 F.3d 196 (2d Cir. 2008) (burden to prove Rule 23 requirements by preponderance)
Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (Supreme Court 1997) (framework for determining class certification requirements)
Klay v. Humana, Inc., 382 F.3d 1241 (11th Cir. 2004) (uniform state-law considerations; predominance with contract claims)
Wilborn v. Wells Fargo Bank, N.A., 609 F.3d 748 (5th Cir. 2010) (common issues can overcome individualized defenses in class actions)
Currency Conversion Fee Antitrust Litig., 230 F.R.D. 303 (S.D.N.Y. 2010) (uniformity of contract-law principles supports class treatment)
Wu v. Pearson Educ., Inc., 277 F.R.D. 255 (S.D.N.Y. 2011) (contract-law uniformity; suitability for class actions)
Spagnola v. Chubb Corp., 264 F.R.D. 76 (S.D.N.Y. 2010) (class treatment for claims arising from form contracts)
Steinberg v. Nationwide Mut. Ins. Co., 224 F.R.D. 67 (E.D.N.Y. 2004) (form contracts suitability for class actions)
In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124 (2d Cir. 2001) (predominance and common questions in antitrust class actions)