District Court (Pa.) Says De Minimis Recovery by FDCPA Class Does Not Defeat Class Cert., Rejects Argument that Limiting Class to Residents of Single Zip Code Sidesteps FDCPA’s Class Action Penalty Limit

. . .NRA contended that its net worth is $84,000. A net worth this low could foreseeably result in a de minimis recovery for each individual class member (one percent of $84,000 is $840; $840 split amongst a class of 1,300 members is approximately $0.65 per class member). If the putative class members were to pursue these claims on their own, they could recover actual damages or statutory damages up to $1,000. See 15 U.S.C. § 1692k(a)(2)(A). While this argument has some facial appeal, ultimately, NRA’s efforts to protect the rights of the class members to recover more money from it are unavailing. See Lemire v. Wolpoff & Abramson, LLP, 256 F.R.D. 321, 330–31 (D. Conn. 2009) (discussing disingenuous nature of this argument). . . .Courts facing this issue typically hold that unless the defendant’s net worth is negative, superiority is not destroyed. See Kohnlenberger v. Dickinson, No. 94 C 4696, 1996 WL 131736, at *2 (N.D. Ill. Mar. 15, 1996) (noting that class action is not superior where defendant’s net worth is “zero or less”); see, e.g., Hicks v. Client Servs., Inc., 257 F.R.D. 699, 701 (S.D. Fla. 2009) (collecting cases and refusing to decertify class despite evidence individual class members may only receive $1.24); Abels v. JBC Legal Grp., P.C., 227 F.R.D. 541, 546–47 (N.D. Cal. 2005) (finding superiority prong met even though class members would likely only receive $0.25 per person); Macarz v. Transworld Sys., Inc., 193 F.R.D. 46, 55 (D. Conn. 2000) (“Although class members may recover smaller damages amounts than would have been the case in individual actions, the Court finds that the class action vehicle is nonetheless superior, given the remote likelihood that such individual actions actually would be brought.”). But see Barkouras v. Hecker, No. 06-cv-0366, 2006 WL 3544585, at *4 (D.N.J. Dec. 8, 2006) (holding that superiority was satisfied even though one of defendants was alleged to have a negative net worth). Here, NRA has not contended that its net worth is negative.  Additionally, Rule 23(c) permits class members in Rule 23(b)(3) classes to opt out and bring their own claims. See Fed. R. Civ. P. 23(c)(2)(B); Lemire, 256 F.R.D. at 330–31 (discussing the significance of the opt out provision in FDCPA class actions where the defendant has contended individual recovery will be de minimis); see also Fed. R. Civ. P. 23(c)(2)(B) advisory committee’s note to 2003 amendment (“The opportunity to request exclusion from a proposed settlement is limited to members of a (b)(3) class.”). Because Rule 23(b)(3) gives class members the option to opt out of the class, class members who desire to bring their own claims can still do so. Thus, NRA’s professed concern is adequately protected even when the class is certified, i.e., class members who desire to win greater awards from NRA can still pursue them. Consequently, the court finds that the first factor weighs in favor of a finding of superiority. . . . And finally, because the class has been limited to class members with a 17512 zip code, it is very likely that all (or at least, most) of class members will reside within this district.  NRA, however, has argued that O’Dell’s decision to limit the class to zip code 17512 actually cuts against a finding of superiority. Specifically, NRA argues that by limiting the putative class to “approximately 1,600 members in one Pennsylvania zip code….Plaintiff’s counsel failed to adequately protect the right [sic] and interests of the other 63,000 consumers that were allegedly affected by NRA’s reporting of LGH debts in 2016.” Def.’s Br. at ECF pp. 20–21 (internal citation omitted). This argument is also unavailing.  While the Third Circuit has yet to address whether a class action brought under section 1692k can be limited by geography, the Seventh Circuit persuasively addressed that question in Mace v. Van Ru Credit Corp., 109 F.3d 338, 343–44 (7th Cir. 1997). In that case, the court rejected the defendant’s argument that the statutory cap of $500,000 should be interpreted to exclude multiple classes based on geography. See id. at 344. The court noted that the plain language of the statute did not prohibit multiple classes. See id. The court also noted that there is “no way of telling whether…repeated class actions are possible or likely….” Id.  The court agrees with the Seventh Circuit’s focus on the text of the statute. The statute broadly states: “in the case of a class action….” 15 U.S.C. § 1692k(a)(2)(B). It does not cabin the number of class actions that can be pursued or prohibit the use of geographical limitations in the definition of the class. Because the unrestrictive language of the statue is clear, the court does not need to wade into the well-articulated policy arguments presented by NRA.