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Ramthun v. Bryan Career College - Inc.

United States District Court, W.D. Arkansas, Fayetteville Division

March 18, 2015

TRACY RAMTHUN and ANGELA CLEMENS, PLAINTIFFS
v.
BRYAN CAREER COLLEGE - INCORPORATED, d/b/a Bryan College; and BRYAN UNIVERSITY, DEFENDANTS

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For Tracy Ramthun, Angela Clemens, Plaintiffs: Alan L. Lane, LEAD ATTORNEY, ODOM & ELLIOTT, Fayetteville, AR; Matt L. Lindsay, LEAD ATTORNEY, Odom & Elliott P.A., Fayetteville, AR; Monte A. Sharits, LEAD ATTORNEY, Odom Law Firm, P.A., Fayetteville, AR.

For Bryan Career College - Incorporated, doing business as Bryan College, Bryan University, Defendants: Jason C. Smith, LEAD ATTORNEY, Spencer Fane Britt & Browne LLP, Springfield, MO; Steven M. Gombos, LEAD ATTORNEY, Ritzert Leyton P.C., Fairfax, VA; Charles Robinson Camp, Ritzert Leyton, Fairfax, VA; Derek A. Ankrom, PRO HAC VICE, Spencer Fane Britt & Browne LLP, Springfield, MO.

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OPINION AND ORDER

P.K. HOLMES, III, CHIEF UNITED STATES DISTRICT JUDGE.

Currently before the Court is the motion (Doc. 57) for class certification under Rule 23 and brief in support (Doc. 58) submitted by Plaintiffs Tracy Ramthun and Angela Clemens. Defendants Bryan Career College - Incorporated and Bryan University (together, " Bryan" ) filed a response (Doc. 67) and brief in support (Doc. 63) under seal, and Plaintiffs filed a reply (Doc. 72) under seal with leave of the Court. Plaintiffs also filed a motion for leave to file supplemental affidavits to their motion for certification.[1] Although Bryan requested a hearing, the Court has determined that

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no oral argument is necessary to decide this motion.

Plaintiffs move to certify this class action for all claims raised in their second amended complaint (Doc. 44). The second amended complaint also identified Carolina Trevino as a plaintiff and putative class representative, but she has since been dismissed from the case on her own motion. Plaintiffs bring causes of action for fraud, constructive fraud, a violation of the Arkansas Deceptive Trade Practices Act (" ADTPA" ) (Ark. Code Ann. § 4-88-101 et seq.), breach of contract, and breach of implied warranty. For the reasons explained below, Plaintiffs' motion to certify (Doc. 57) will be DENIED. Additionally, the Court will order Plaintiffs to SHOW CAUSE why Bryan is not entitled to judgment as a matter of law on the breach of implied warranty and ADTPA claims.

I. Background

Plaintiffs are residents of Arkansas who enrolled in and attended classes at Bryan's campus in Rogers, Arkansas, and received medical assistant degrees. Ramthun was enrolled from April 21, 2010 to January 6, 2012. Clemens was enrolled from August 2009 to April 2011. Plaintiffs enrolled and attended classes after speaking with admissions advisors, recruiters, and agents of Bryan at the Rogers, Arkansas campus and signing various documents. Plaintiffs allege that Bryan represented to them that Bryan was fully and nationally accredited, but did not tell them that, due to the difference in national and regional accreditation standards, credit hours from nationally accredited institutions were unlikely to be accepted by regionally accredited institutions. Upon completion of their degrees, Plaintiffs allegedly attempted to transfer credit hours from Bryan to other institutions and found that those institutions did not accept Bryan credits. (Docs. 74-1--74-4). Plaintiffs claim that Bryan committed fraud and breached its contract with them by representing that its credit hours could be transferred to other institutions.

Plaintiffs brought the instant action in the state courts of Arkansas. Bryan removed on the basis of the Class Action Fairness Act, 28 U.S.C. § 1332(d), and then filed a motion to dismiss. The Court[2] denied the motion on the grounds that the Complaint alleged plausible claims based on nontransferability of credits, but otherwise rejected Plaintiffs' educational malpractice allegations. (Doc. 18). On joint motion of the parties, the Court later stayed all deadlines in the case pending resolution of the class certification issue. (Doc. 40). Plaintiffs then moved for class certification.

Plaintiffs define their putative class as " [a]ll students who, from January 23, 2008 to December 31, 2011, enrolled and were charged tuition by Bryan College." (Doc. 58, p. 15). Assuming the necessity of subclasses, Plaintiffs propose to further divide the putative class into four subclasses, defined as:

All students who, from January 23, 2008 to December 31, 2011, enrolled at Bryan College's Rogers, Arkansas campus and were charged tuition by Bryan College.
All students who, from January 23, 2008 to December 31, 2011, enrolled at Bryan College's Springfield or Columbia, Missouri campuses and were charged tuition by Bryan College.
All students who, from January 23, 2008 to December 31, 2011, enrolled at Bryan

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College's Topeka, Kansas campus and were charged tuition by Bryan College.
All students who, from January 23, 2008 to December 31, 2011, enrolled at Bryan College's online campus and were charged tuition by Bryan College.

Id. The putative subclass claims include all the claims in the complaint--fraud, constructive fraud, a violation of the ADTPA, breach of contract, and breach of implied warranty--with the exception that the ADTPA claim be construed as a claim under the state consumer protection laws relevant to each putative subclass.[3]

II. Applicable Law

The procedure for certifying a class action lawsuit is found in Federal Rule of Civil Procedure 23. On a motion for class certification, the movant has the burden to affirmatively demonstrate that the requirements of Rule 23 are met. Wal-Mart Stores, Inc. v. Dukes, __ U.S. __, 131 S.Ct. 2541, 2551, 180 L.Ed.2d 374 (2011). The Court must conduct a rigorous analysis to determine whether compliance with Rule 23 has been demonstrated. Comcast Corp. v. Behrend, U.S, 133 S.Ct. 1426, 1432, 185 L.Ed.2d 515 (2013). In conducting this analysis the Court may " probe behind the pleadings," and the analysis may " entail some overlap with the merits of the plaintiff's underlying claim." Dukes, 131 S.Ct. at 2551 (internal quotations omitted).

Before a class can be certified under Rule 23, the movant must demonstrate that the class representative is a member of the class and that:

(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and
(4) the representative parties will fairly and adequately protect the interests of the class.

Fed. R. Civ. P. 23(a). The prerequisites in these four subsections are commonly referred to as the requirements of " numerosity, commonality, typicality, and adequate representation." Dukes, 131 S.Ct. at 2550. Where subclasses are necessary to maintain a class action, " [t]he requirements must be satisfied as to each subclass." Paxton v. Union Nat'l Bank, 688 F.2d 552, 559 (8th Cir. 1982).

A class that meets these four requirements may proceed with its action if it also qualifies as one of the types of actions that may be maintained under Rule 23(b). The burden is on the party seeking certification to demonstrate with evidentiary proof that Rule 23(b) is satisfied. Comcast Corp., 133 S.Ct. at 1432. Plaintiffs here seek certification under Rule 23(b)(3). An action may be maintained under Rule 23(b)(3) if " the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3). The Rule provides a nonexclusive list of matters pertinent to these findings:

(A) the class members' interest in individually controlling the prosecution or defense of separate actions;
(B) the extent and nature of any litigation concerning the ...

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