Ohio Supreme Court Hears Oral Argument in Potentially Landmark Class Action Case

The Ohio Supreme Court heard oral argument Wednesday morning in the potentially landmark Ohio class action case Stammco v. United Tel. Co. of Ohio, Ohio Supreme Court Case No. 2012-016912-0169. We have previously discussed the facts of this case, the appellants’ merit brief and the appellees’ merit brief.

Briefly, Stammco alleges that Sprint engaged in the practice of “cramming,” or causing unauthorized charges to be placed on their customers’ telephone bills. The proposed class includes Stammco and other Sprint customers who were subjected to these allegedly unauthorized charges.

This case has been pending for more than eight years and has already made one trip to the Ohio Supreme Court. In Stammco’s first trip to the Ohio Supreme Court in March 2010, the Court reversed class certification, holding that the class as defined was ambiguous and not readily identifiable. The Court then remanded the case, tasking the trial court with redefining the class.

On remand, the trial court denied class certification, holding that: (1) plaintiffs' revised class definition was failsafe, (2) the action was brought against the wrong party, and (3) the action imposed a duty on UTO and Sprint that was not required by law.

The Sixth District Court of Appeals reversed, relying on Ojalvo v. Bd. Of Trustees of Ohio State Univ., 12 Ohio St.3d 230, 466 N.E.2d 875, holding that any consideration of merits issues in deciding class certification is erroneous.

At oral argument, Michael Farrell for appellant Sprint argued that the class definition — even if no longer ambiguous — still results in an unidentifiable class. He explained that ambiguity and identifiability are related — but distinct — issues. His example was this: a class definition that includes all people who visited Columbus in 2012 is not ambiguous, but it is, nonetheless, impossible to identify every single person who entered the city of Columbus in a given year. An unambiguous, yet unidentifiable class.

Here, Farrell noted, determining whether a particular charge was “authorized” is a complicated question that has, in the named plaintiff’s case, taken two depositions and written discovery to determine — and it is still an open question. Further, Farrell noted that if the class is not certified, customers do have a remedy in small claims court.

Dennis Murray for appellee Stammco argued that the trial court here improperly made two critical merits determinations, which he says is prohibited by the Court’s precedent. Murray also distinguished the U.S. Supreme Court’s recent WalMart v. Dukes case, noting that Dukes was decided in the employment context and involved thousands of individual employment decisions. 

When asked by Justice Lanzinger whether any prior cramming cases had been certified across the country, Murray responded that the only certified cases were in the context of a settlement. Farrell, on the other hand, noted that no contested cramming cases have been certified.

Finally, Murray argued that the class is identifiable by simply reviewing Stammco’s records. Stammco’s records, he says, will demonstrate who was charged, which customers complained and each instance in which a charge was reversed. This information can then be crunched by statisticians to determine how many customers likely had unauthorized charges on their bills. Murray further pointed to an FCC investigation in which Sprint purportedly admitted that its records would reflect which customers were overcharged and refunded.

In his rebuttal, Farrell objected to the use of a statistical sample to determine liability, noting that such a procedure violates the due process rights of both the defendant and absent class members. Further, he challenged the Court to clarify its decision in Ojalvo in light of the Dukes case with regard to when a trial court can consider merits issues in a class action context. Justice Pfeiffer had the last word, noting that the Court “accepted the challenge.”

We will now await the Court’s decision and will report on the decision and its potential impact on Ohio class action jurisprudence once the decision is released.

Ohio Class Action Law