Hefczyc v. Rady Children’s Hospital-San Diego (Nov. 17, 2017, D071264) __ Cal.App.5th __ [2017 WL 5507854]
The guarantor of a minor self-pay patient filed a class action lawsuit seeking declaratory relief establishing that the Hospital’s form contract, which allowed the Hospital to charge its “regular rates and terms,” authorized the Hospital to charge only for the reasonable value of its services, rather than its inflated “Chargemaster” rates. Plaintiff sought to certify a class of “the guarantors of all persons who within the last four years, had one or more ‘eligible patient hospital visits’ to [the Hospital’s] emergency department.” The court refused on the grounds the class was not ascertainable, common issues did not predominate, and class action litigation was not a superior means of proceeding. The guarantor appealed from the denial of class certification.
The Court of Appeal affirmed. The guarantor had argued that the federal class certification rule, FRCP 23, should apply because he sought declaratory relief only. (The guarantor made this argument to try to avoid having to satisfy state-law ascertainability, predominance, and superiority requirements.) Citing its recent decision in Kendall v. Scripps Health (2017) 16 Cal.App.5th 553, which refused to apply FRCP 23 in an action for damages and restitution, the court explained that federal rules apply only in the absence of relevant state precedent. Here, the California Supreme Court has consistently required litigants seeking class certification to demonstrate ascertainability, predominance, and superiority and has never indicated it would diverge from those requirements in cases seeking only declaratory relief.
The Court of Appeal also held that the trial court did not abuse its discretion in determining that the class was not ascertainable, that common issues did not predominate, and that class action litigation was not a superior means of proceeding. Because the trial court would need to make individualized factual inquiries as to whether Chargemaster rates were reasonable as to each potential class member, common issues would not predominate and proceeding on a classwide basis would have been an inferior method of adjudication. The court also rejected the plaintiff’s argument that the class was ascertainable because members of the public could self-identify as class members. The court reasoned that the public could not be expected to know whether they had been billed Chargemaster rates.
Thomas Watson
htwatson@horvitzlevy.com
Horvitz & Levy LLP
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