Chicago Business Litigation Lawyer Blog
We recently had a win in the Illinois Appellate Court in S37 v. Advanced Refrigeration. The Appellate Court affirmed the trial court’s decision to certifiy a class action regarding the claims in that. Advanced sells appliances to various businesses and added a charge on its invoices called government processing requirment. This fee was not required to be paid by the government and was not a government mandated fee. Advanced created the fee to recover costs it allegedly incurrs in complying with government requirements. The Class-Action Complaint alleged that the fee was deceptive in that it allegedly made a profit generating fee appear as if it were a government required fee. Advanced denied these allegations and opposed class-certification. The trial court denied Advanced’s motion to dismiss and then certified the case as a class-action.
The Appellate Court granted leave for an appeal of the class-certification decision. Advanced argued that it disclosed the true nature of the fee to all customers and that such alleged disclosure gave rise to individual issues blocking class certification. The Class argued that this defense did not create invididual issues barring class-certification as the defense of full disclosure was common the entire class given Advanced’s claim that it told all customers that the fee wasn’t a government mandated fee or tax as the fee’s name allegedly suggested it was.
The Appellate Court rejected Advanced’s arguments and found that the trial court properly exercised its discretion in certifying the class-action.
The Appellate Court held:
We agree with the plaintiff that this case fits the pattern of cases routinely certified as
class actions by Illinois courts. See Martin v. Heinold Commodities, Inc., 163 Ill. 2d 33, 643
N.E.2d 734 (1994) (resolved as a class action, the court held the commodity option contracts
broker’s disclosure statement was misleading, in violation of the Illinois Consumer Fraud Act,
because the “foreign service fee” to be charged investors was a commission from which it would receive compensation); Harrison Sheet Steel Co. v. Lyons, 15 Ill. 2d 532, 155 N.E.2d 595 (1959)(class action was proper where the defendant refused to refund illegal occupation taxes collected from its customers); P.J.’s Concrete Pumping Service, Inc. v. Nextel West Corp., 345 Ill. App. 3d 992, 1003, 803 N.E.2d 1020 (2004) (“The primary factual issue in this case is a uniform billing practice that allegedly violated the Consumer Fraud Act in the same manner as to all class members. The propriety of such a uniform practice is amendable to being resolved in a class action.”).
The Appelalte Court also noted that the brief of the National Association of Consumer Advocates (which filed a friend of the court submission) stated that class-actions provided a way for small claims like this to proceed to court and to obtain justice when small alleged wrongs in the aggregate allegedly harm many consumers:
“ ‘The policy at the very core of the class action mechanism
is to overcome the problem that small recoveries do not provide the
incentive for any individual to bring a solo action prosecuting his or
her rights. A class action solves this problem by aggregating the
relatively paltry potential recoveries into something worth
someone’s (usually an attorney’s) labor.’ ” Amchem Products, Inc. v. Windsor, 521
U.S. 591, 617 (1997), quoting Mace v. Van Ru Credit Corp., 109 F.3d 338, 344 (7th Cir. 1997).
You can view the full opinion of the Appellate Court by clicking here.