Plaintiff Lois J. Naftulin ("Naftulin") moves pursuant to CPLR 901 and 902 for an Order certifying a nationwide class action under the theories of common law fraud, breach of contract and unjust enrichment, and for an Order certifying a New York State sub-class on additional claims of violations of General Business Law §§ 349 and 350. Plaintiff seeks certification of a class of herself and all others "who subscribed to Sprint's 3000 minute $49.99 Add-A-Phone' plan between September 16, 2001 and September 29, 2001, and did not receive service at the promised price."

On September 16, 2001, a promotional circular advertising a Sprint "Add-A-Phone" cellular telephone calling plan was distributed by Staples as a newspaper insert in approximately 200 newspapers nationwide. The advertisement offered a "2 Phones 1 Rate Plan" with 3000 minutes at a rate of $49.99 per month. The advertisement also stated that more phones could be added for an additional $10.00 per month. Plaintiff received the circular in the New York Times. Intending to purchase the plan and three telephones, Plaintiff went [*2]to a Staples store on September 18, 2001. Because the Staples store did not have the telephones, Plaintiff went to another store, Digital Express PCS, which, acting as an agent for Sprint, sold her the advertised plan and three phones. The phones were activated by Sprint at the time of the transaction. Plaintiff paid $364.00 for the phones and paid an activation fee of $34.99. The plan was to be billed at $49.99 per month. Plaintiff anticipated paying an additional $10.00 per month for the third phone.

Upon receiving her Sprint bill, Plaintiff realized that she was being charged $79.99 instead of the $59.99 she had expected. Repeated communications with Sprint ensued over the following months, during which plaintiff was offered credits and various options, including changing plans or cancelling the plan she had purchased without penalty. However, none of the options offered to plaintiff were consistent with her expectations of the plan she had purchased as advertised in the Staples brochure. It is plaintiff's contention that the defendants, Sprint and Sprint Spectrum, L.P., never fully honored the contract she entered into on September 18, 2001.

Defendants, in opposition to plaintiff's application, acknowledge that the Plan was offered by Sprint, but contend it was erroneously offered to plaintiff in New York since the intent was to test-market the Add-a-Phone Promotion only in Detroit and Washington DC for two weeks, September 16 through September 29, 2001. Plaintiff accepts this representation as an uncontroverted fact. Sprint claims it was Staples' error that caused the Plan to be marketed in New York and that the error was immediately remedied upon discovery within 24 hours. Sprint has submitted internal communications dated September 17, 2001, evidencing its efforts to retract the offer by Staples. However, plaintiff was able to enter into her contract with Sprint on September 18 through a store other than Staples. Defendants resist class certification based partially upon the uniqueness of plaintiff's experience, asserting that plaintiff could not represent a broader class of consumers.

Following discovery of the error, and in response to her complaints, plaintiff was offered the opportunity to deactivate the service without incurring a fee, which she never did. Between September 27, 2001, when plaintiff first called to complain of her incorrect bill and was advised of the error, and May 2002, plaintiff made several calls complaining of her bill and was offered several remedial alternatives in addition to deactivation, including a credit for two months at the promotional rate, a change in plan, and various lump-sum credits, some of which were applied. However, plaintiff had purchased three telephones from [*3]Digital Express at a cost of $364.00; there was no discussion regarding compensation for those phones. On June 4, 2002, plaintiff was offered a credit of $240.00 intended to cover all of the alleged overcharges for one year. This offer was reiterated by letter dated June 10, 2002. In the alternative, Sprint offered to waive a $150.00 early termination fee and cancel the account. Plaintiff had already received credits totaling $50.00

This class action was filed on June 7, 2002. Review of defendants' records revealed that 16,000 individuals nationwide activated $49.99 "Add-A-Phone" service plans between September 16 and September 30, 2001, over 900 of whom were in New York. From its records, defendants have identified 26 individuals nationwide, including plaintiff, who contacted Sprint to complain about billing overcharges in connection with the Staples advertisement, four of whom were in New York. These individuals were offered a variety of options for redress, some of which were accepted, some of which were not. The alternatives offered to the individual customers differed, apparently depending on the discretion of the customer service representative handling the complaint. Thus it is defendants' contention that there is no commonality in the handling of the complaints of the proposed class members and no commonality in the status of each member based upon their individual choices to negotiate or accept a settlement of their complaint. Defendants have prepared a chart itemizing the disposition of each of 37 complaints "Regarding Add-A-Phone Plan" (annexed as an exhibit to both parties' papers) indicating that 30 of those who complained accepted some form of compensation. Only 26 individuals mentioned the Staples ad. Of the 26, four, including plaintiff, were from New York.

CLASS ACTION CERTIFICATION

CPLR 902 provides that an action may be maintained as a class action only if the prerequisites of CPLR 901 have been satisfied. The five conditions that must be met are:

1) numerosity- the class is so numerous that joinder of all members of the class would be impracticable;

2) common questions of law or fact predominate over claims affecting individual members;

3) the claims of the representative are typical of the claims of the class;

4) the class representative will fairly and adequately protect the members of the class;

5) a class action is superior to other methods for fair and efficient [*4]adjudication of the controversy.

The moving party has the burden of demonstrating that all five prerequisites have been met. Canavan v. Chase Manhattan Bank, N.A., 234 AD2d 493 (2d Dep't, 1996). The court has wide discretion in determining the feasibility and propriety of a class action. Wilder v. May Dept. Stores Co., 23 AD3d 646 (2d Dep't, 2005); Klurfeld v. Equity Enterprises, Inc., 79 AD2d 124 (2d Dep't, 1981)

Policy favors the maintenance of class actions and a liberal construction of the class action statute. See, Friar v. Vanguard Holding Corp., 78 AD2d 83(2d Dep't 1980). However, "[a]s a general proposition, in a class action, the class must not be defined so broadly that it encompasses individuals who have little connection with the claim being litigated; rather, it should be restricted to individuals who are raising the same claims or defenses as the representative' (7A Wright, Miller and Kane, Federal Practice and Procedure Civil 3a § 1760)." Klein v. Roberts, 28 AD3d 63, 71 (2d Dep't, 2006).

Numerosity

The prerequisite that the class be "so numerous that joinder of all members would be impracticable" is known as "numerosity". A class action is appropriate only where joinder in accordance with the usual rules of procedure is impracticable. Multiple separate litigations of claims sharing common factual and legal issues generate duplicative discovery, pleading and motion practice and waste judicial resources. See Small v. Lorillard Tobacco Co. Inc., 252 AD2d 1 (1st Dep't, 1998). Moreover, without class certification, the putative class members might not pursue valid claims on their own because of lack of resources or incentive.

The statute does not specify a minimum number of class members needed to satisfy the numerosity requirement and there is no mechanical test to determine whether a class is sufficiently numerous or any authority establishing a minimum threshold. See, Friar v. Vanguard Holding Corp., 78 AD2d 83. A class of 38 members was certified in Caesar v. Chemical bank, 118 Misc 2d 118 (Sup. Ct, NY Co., 1983), affirmed at 106 AD2d 353(1st Dep't, 1984). As defendants note, federal courts have generally found that numerosity is presumed at a minimum of 40 putative class members. See Consolidated Rail Corp. v. Town of Hyde Park, 47 F3d 473, 483 (2d Cir. 1995). Defendants have identified 26 individuals nation wide who contacted Sprint to complain about billing overcharges in connection with the advertised plan. Of that number, only two individuals received no offers [*5]of compensation. Even plaintiff received credit.

A conscientious assessment of the five factors essential to class action certification will necessarily require an examination, beyond the pleadings, into the factual and legal issues presented by a particular case. See General Telephone Co. of the Southwest v. Falcon, 457 US 147, 160-61 (1982); In re Initial Public Offering Securities Litigation, 471 F3d 24 (2d Cir. 2006); Seligman v. Guardian Life Ins. Co., 59 AD2d 859 (1st Dep't, 1977).^[FN1]

Plaintiff - proposed class representative has given her deposition explaining that she was induced by a flyer published through the New York Times by Staples to go to Staples in order to take advantage of defendants' promotional offer. Defendants have explained, and it is not disputed, that the Staples' promotion was to have been limited to a test-market that did not include New York. The flyer plaintiff relied upon was erroneously distributed, not by the Sprint defendants, but by Staples, which is not a party. Evidence submitted by defendants demonstrates that, immediately upon learning of the error, on September 17, a day prior to plaintiff's purchase, defendants took steps to remove the offer from Staples stores. In fact, Staples was unable to provide the offer to plaintiff and she actually made her purchase of phones and signed the Sprint contract at another store, Digital Express. Defendants have sought, through their customer representatives, to rescind the contracts entered erroneously based upon the offer placed in newspapers all over the country by Staples. Many of the twenty-six individuals actually identified as potential class members, that is, people who mentioned the Staples ad in their complaints, accepted Sprint's offers of compensation for losses sustained by those individuals as a result of Sprint's non-compliance with the terms of the contract as set forth in the ad and/or accepted a modification of the terms of the Sprint contract.`

Plaintiff relies on defendants' identification of 16,000 nationwide activations of $49.99 "Add-a-Phone" plans in the two-weeks during which the test-marketing was to occur, 972 of which were in New York, to establish the numerosity of potential class members required for certification. Defendants [*6]represent that only 34 New York residents activated service identical to that purchased by plaintiff. Of that number, however, based upon defendants' logs of customer complaints, only six complained, two of whom did not mention the Staples ad, and five of whom accepted some form of compensation. Nationwide, of the 26 Staples-related complaints received, twenty-three individuals accepted some form of compensation. Thus, the potential class members similarly situated to Plaintiff, actually identified through discovery, number very few individuals.

Plaintiff urges this court to project upon the larger group of 16,000, the proportion of dissatisfied, and therefore defrauded, customers who complained to establish a much larger potential class. However, the data do not support such a projection. The 16,000 activations identified are not necessarily identical to the plan advertised in the subject Staples flyer and there is no indication as to what proportion of those who bought plans during the relevant period actually saw the Staples flyer. In fact, since the promotion was retracted within 24 hours of defendants' learning of the mistake in publication, the 16,000 member pool of individuals who bought a plan similar to plaintiff's during the two week period defined is undoubtedly an inaccurate and greatly exaggerated number of potential class members. A more accurate class description, based upon plaintiff's own experience and defendants' immediate retraction of the ad, would be limited to those who subscribed between September 16 and September 18, 2001. Applying the proportion of those who accepted compensation or modification of the contract, the class is further diminished. Moreover, of the 16,000 who activated a plan similar to that advertised by Staples in New York, presumably a substantial number are individuals within the test market who were actually supplied with the advertised service. Based upon the history of restitution provided to those who complained, together with the noted differences between the proposed class members, there is only a minuscule number of actual potential class members who suffered injury as a result of defendants' allegedly fraudulent advertising.

Plaintiff has not met her burden to demonstrate a sufficient number of putative class members to satisfy the requirement of numerosity.

Predominance of Common Questions of Law or Fact

The second requirement for maintenance of a class action is that questions

of law or fact common to the class predominate over claims affecting individual members. As with the numerosity requirement, there is no mechanical test. Friar v. Vanguard Holding Corp., 78 AD2d 83. The court will look to whether the "use of a class action would achieve economies of time, effort, and expense, and [*7]promote uniformity of decision as to persons similarly situated.'" Id. at 97, citing LaMar v. H & B Novelty & Loan Co., D.C., 55 FRD 22, 25. There are five causes of action pleaded in the complaint: Deceptive Trade Practices under GBL 349, False Advertising under GBL 350 and 350-a, Common Law Fraud, Breach of Contract and Equitable Disgorgement and Constructive Trust to Prevent Unjust Enrichment. Plaintiff requests certification of a national class under the common law theories of fraud, breach of contract and unjust enrichment ^[FN2] and certification of a sub-class of New York residents under the New York General Business Law statutes. See Goshen v. Mutual Life Insurance Co. Of New York, 98 NY2d 314 (2002).

In Solomon v. Bell Atlantic Corp. 9 AD3d 49 (1st Dep't, 2004), the Appellate Court decertified a class of New York subscribers to DSL who had "experienced slower than advertised Internet download speeds, and who experienced connectivity outages" for failure of plaintiffs to demonstrate that questions common to the class members would predominate over individual factors. The claims of plaintiffs were, as herein, premised upon General Business Law §§ 349 and 350, and asserted deceptive advertising resulting in injury. A prerequisite to the maintenance of the action, said the Court, is a demonstration that "each plaintiff was reasonably deceived by the defendant's misrepresentations or omissions and was injured by reason thereof"; "all members of the class [must have been] exposed to the same misrepresentations" (9 AD3d at 52-53). Finding that because there was inadequate evidence that all members of the putative class had seen the same advertising and had actually relied thereon in contracting for DSL service, the Solomon Court held that individual trials would be necessary to determine whether the particular class member had actually been misled by a specific misrepresentation. See also, Klein v. Robert's American Gourmet Food, Inc., 28 AD3d 63, 72 (2d Dep't, 2006); Small v. Lorillard Tobacco Co., Inc., 252 AD2d 1, 6 (1st Dep't, 1998); Hoerger v. Board of Education, 98 AD2d 274, 282 (2d Dep't, 1983). The Solomon Court further held that individualized proof of injury would also be necessary to establish damages. See also, Hazelhurst v. Brita Prods. Co., 295 AD2d 240, 242 (1st Dep't, 2002).

Like the plaintiffs in Solomon, here, a substantial number of the prospective members of the putative class have already received some form of compensation for their injury. It further appears from defendants' representations that there was [*8]no uniformity in the terms of the contracts provided to the putative class members, nor are the plans, though providing similar service, identical. Plaintiff herself did not sign up at Staples, the acknowledged source of the "false" advertising, but contracted at a local (as opposed to national) store using a contract not demonstrated to be identical to that used by Staples.. Thus, the plaintiff is not a typical representative of the class as defined. See CPLR 901 (a) (3); Hazelhurst v. Brita Prods. Co., 295 AD2d at 242-43. Moreover, the inducement to purchase defendants' services cannot be inferred and is unique to each class member. See Hazelhurst, id. Individual issues have been found to predominate, precluding the certification of a class, where there were variations in the representations made to class members or in the transactions between class members and representatives of the defendant. See, Solomon v. Bell Atlantic Corp., 9 AD3d 49; Carnegie v. H & R Block, Inc., 269 AD2d 145 (1st Dep't, 2000).

Defendants further argue that nationwide class certification must be denied as to the common law fraud and breach of contract claims because of the differences in state law, citing Drizin v. Sprint Corp., 12 AD3d 245 (1st Dep't, 2004). Defendants have demonstrated through citation to nation-wide state authority that the legal standards applicable to plaintiff's causes of action vary from state to state. Litigation of the proposed class action would require this Court to apply the conflicting law of 50 different jurisdictions to the claims presented. See Philips Petroleum Co. v. Shutts, 472 US 797 (1985). Under such circumstances, such litigation would be unmanageable and certification of a national class must be denied. See Drizin at 247; Rabouin v. Metropolitan Life Ins. Co., 25 AD3d 349, 350-51 (1st Dep't, 2006).

Given all of the potentially unique permutations of the facts as to each transaction within the putative class, the requisites of CPLR 901(a) have not been met and plaintiff has not demonstrated that a class action is an appropriate or superior method for adjudication of the controversy. See Karlin v. IVF America, Inc., 239 AD2d 562 (2d Dep't, 1997). Since plaintiff has failed to satisfy three of the five criteria set forth in CPLR 901(a), there is no need to consider whether other criteria have been met. ^[FN3]

In light of the monetary recovery sought on behalf of the individual plaintiff, this case is transferred to the Civil Court of the City of New York [*9]pursuant to CPLR 325(d) and Rule 202.13(a) of the Uniform Civil Rules for the Supreme Court.

The motion to certify the proposed class and sub-class is denied.

The foregoing constitutes the decision and order of the Court.

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