Wright v. S. New Hampshire Univ.

565 F.Supp.3d 193

Briana WRIGHT

v.SOUTHERN NEW HAMPSHIRE UNIVERSITY

Civil No. 20-cv-609-LM

United States District Court, D. New Hampshire.

Signed April 26, 2021

Benjamin T. King, Douglas Leonard & Garvey PC, Concord, NH, Philip Lawrence Fraietta, Bursor & Fisher, P.A., New York, NY, for Briana Wright.

Christopher Cole, John-Mark Turner, Sheehan Phinney Bass & Green PA, Manchester, NH, Robert J. Burns, Holland & Knight, New York, NY, for Southern New Hampshire University.

ORDER

Landya McCafferty, United States District Judge

Plaintiff Briana Wright brings this putative class action on her own behalf and on behalf of a proposed class of students and former students of defendant Southern New Hampshire University ("SNHU") who paid tuition and fees for in-person educational services during SNHU's spring 2020 semester. Wright alleges that in spring 2020 the per-semester cost in tuition and fees for in-person educational services at SNHU (the "campus experience" option) was approximately $17,500, whereas the per-semester cost to students who elected to attend SNHU classes remotely (the "online experience" option) was $960 per course, or $4,800 for a full load of five courses. It is undisputed that, because of the global COVID-19 pandemic, SNHU canceled all of its in-person classes from March 11, 2020, through the end of its spring 2020 semester, without refunding or abating the tuition or fees paid by students who chose the campus experience option. Plaintiff alleges that students who contracted and paid for SNHU's campus experience received educational services during approximately half of the spring 2020 semester that were identical to those received by students who paid lesser amounts for SNHU's online experience. Plaintiff asserts claims for breach of contract, unjust enrichment, and conversion under New Hampshire common law.

The parties report that they have reached a negotiated settlement of their dispute. Now before the court is plaintiff's assented-to motion (doc. no. 30) for preliminary approval of the parties’ proposed class action settlement. The court has carefully reviewed the parties’ proposed Class Action Settlement Agreement (the "Agreement") and its supporting exhibits. For the following reasons, the court: (1) grants plaintiff's motion, (2) preliminarily certifies the proposed class for settlement purposes, (3) provisionally appoints plaintiff's counsel of record as settlement class counsel and plaintiff as settlement class representative, (4) preliminarily approves the proposed settlement agreement, (5) directs class counsel to cause the appointed settlement administrator to provide notice to all class members in accordance with the notice provisions of the Agreement, and (6) sets a briefing schedule and date for a fairness hearing at which class members may appear to support or object to the proposed settlement before the court considers whether to grant final approval of the parties’ agreement.

DISCUSSION

I. Court Approval of Class Action Settlements

"The claims, issues, or defenses of a certified class—or a class proposed to be certified for purposes of settlement—may be settled, voluntarily dismissed, or compromised only with the court's approval." Fed. R. Civ. P. 23(e). Court approval of a proposed class action settlement proceeds in two stages. See Rapuano v. Trs. of Dartmouth Coll., 334 F.R.D. 637, 642 (D.N.H. Jan. 29, 2020) ; see also 4 William B. Rubenstein, Newberg on Class Actions § 13.10 (5th ed. 2019). At the first stage, the court must determine whether it "will likely be able to" both: (1) certify the class for settlement purposes and (2) find that the settlement is fair, reasonable, and adequate. Fed. R. Civ. P. 23(e)(1)(B).

Rule 23(e) was amended in 2018 to provide guidance regarding the standard governing preliminary approval of proposed class action settlements. See Rapuano, 334 F.R.D. at 642-643. The court recently analyzed the impact of the 2018 amendment in connection with preliminary approval of a proposed class action settlement resolving the Title IX hostile education environment claims of a putative class of female students against the Trustees of Dartmouth College. See id. There, the court determined that, in the interests of judicial efficiency and to avoid providing notice to class members regarding a potentially unfair, flawed or inadequate settlement proposal, the court must conduct a "searching," "careful," and "rigorous" inquiry at the preliminary approval stage. Id. at 643 ; see also Fed. R. Civ. P. Rule 23(e), Adv. Commt. Notes, 2018 Amend. ("The decision to give notice of a proposed settlement to the class is an important event. It should be based on a solid record supporting the conclusion that the proposed settlement will likely earn final approval after notice and an opportunity to object."). The court's determination is nevertheless "preliminary in the sense that it is subject to modification based on additional information—including further factual development or objections by class members—that may come to light prior to or during the fairness hearing." Rapuano, 334 F.R.D. at 643 (citing Cotter v. Lyft, Inc., 193 F. Supp. 3d 1030, 1036 (N.D. Cal. 2016) ; Rubenstein, supra, § 13.18).

If the court is satisfied as to both inquiries, it directs the parties to provide notice of the proposed settlement agreement "to all class members who would be bound" by it. Fed. R. Civ. P. 23(e)(1)(B). After notice to the class, the court holds a fairness hearing at which class members may appear to support or object to the proposed settlement. See Rubenstein, supra, § 13.10.

At the second stage of the inquiry, the court must decide whether to grant final approval of the proposed settlement. See id. Under Rule 23(e)(2), the court may grant final approval of a class action settlement if it can certify the proposed class, see Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 621, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997), and if it finds that the proposed agreement is "fair, reasonable, and adequate." Fed. R. Civ. P. 23(e)(2). The First Circuit has recognized as an "important concern" the policy to encourage and facilitate class action settlements where appropriate under Rule 23(e).

Howe v. Townsend, 588 F.3d 24, 36 (1st Cir. 2009) (citing Durrett v. Hous. Auth., 896 F.2d 600, 604 (1st Cir. 1990) ).

This case is at the preliminary approval stage of the Rule 23(e) inquiry.

II. Preliminary Certification of the Proposed Class for Settlement Purposes and Preliminary Appointment of Class Counsel and Class Representative

To obtain certification of a class—whether for settlement or litigation purposes—the court must find that all four prerequisites set forth at Federal Rule of Civil Procedure 23(a) are met. See Amchem, 521 U.S. at 620-621, 117 S.Ct. 2231. These are: (1) numerosity; (2) commonality; (3) typicality; and (4) adequacy. See Fed. R. Civ. P. 23(a) ; Amchem, 521 U.S. at 613, 117 S.Ct. 2231. In addition to those threshold requirements, a party seeking certification must also show that the action falls into one of the categories outlined in Rule 23(b). See id. at 614, 117 S.Ct. 2231. Here, plaintiff seeks certification under Rule 23(b)(3). To qualify for certification under Rule 23(b)(3), the party seeking certification must show that common questions of law or fact "predominate over any questions affecting only individual members" and that class resolution is "superior to other available methods for fairly and efficiently adjudicating the controversy." Fed. R. Civ. P. 23(b)(3) ; see also Amchem, 521 U.S. at 615, 117 S.Ct. 2231.

Although these requirements apply to both settlement and litigation class certifications, courts apply them differently depending on the purpose of certification. See Amchem, 521 U.S. at 619-21, 117 S.Ct. 2231 ; see also In re Hyundai & Kia Fuel Econ. Litig., 926 F.3d 539, 556 (9th Cir. 2019) ; Fed. R. Civ. P. 23(e)(1), Adv. Commt. Notes, 2018 Amend. Specifically, when considering whether to certify a class for the sole purpose of settlement, the court "need not inquire whether the case, if tried, would present intractable management problems." Amchem, 521 U.S. at 620, 117 S.Ct. 2231 ; see also Rapuano, 334 F.R.D. at 643-644. However, other Rule 23 requirements—for example, those preventing overbroad class definitions—deserve "undiluted, even heightened attention" in the settlement context. Amchem, 521 U.S. at 620, 117 S.Ct. 2231. Thus, a district court should apply some Rule 23 requirements more leniently and others more vigorously when it is certifying a class for the purposes of settlement only. See id. at 619-621, 117 S.Ct. 2231 ; see also In re Hyundai, 926 F.3d at 556-557.

Here, plaintiff seeks preliminary certification of the following class for purposes of settlement:

All students and former students [of defendant Southern New Hampshire University] who paid, or on whose behalf payment was made to [defendant in connection with its] Spring 2020 Semester for tuition and fees for in-person educational services, and whose tuition and fees have not been refunded.

Agreement (doc. no. 30-3), ¶ 1.29. Expressly excluded from the proposed class are:

(1) any Judge or Magistrate presiding over this Action and members of their families; (2) the Defendant, Defendant's subsidiaries, parent companies, successors, predecessors, and any entity in which the Defendant or its parents have a controlling interest and their current or former officers, directors, agents, attorneys, and employees; (3) persons who properly execute and file a timely request for exclusion from the class; and (4) the legal representatives, successors or assigns of any such excluded persons.

Id. ¹

The court addresses the Rule 23(a) and 23(b)(3) requirements below.

A. The Rule 23(a) Threshold Requirements

1. Numerosity

Rule 23(a)(1) requires that the putative class be "so numerous that joinder of all members is impracticable." Fed. R. Civ. P. 23(a)(1). "No minimum number of plaintiffs is required to...