Rivera v. Invitation Homes, Inc.

Background

Jose Rivera filed a proposed class action alleging that late fees imposed under Invitation Homes’ standardized lease violated California Civil Code section 1671, California’s Unfair Competition Law, and consumer-protection laws of several other states. The operative complaint defined the proposed class as Invitation Homes’ California tenants who were charged penalties or fees for paying rent deemed late or deficient.

For class certification, Rivera proposed expanding the class to include California tenants of Invitation Homes and its predecessor entities who were charged such fees between May 25, 2014, and the date of certification. The court held that this proposed change would significantly broaden the case beyond the claims pleaded in the complaint. It would reach fees imposed by predecessor entities dating back to 2014, even though the complaint focused on Invitation Homes and its $95 late fee. The court also found that the change would prejudice Invitation Homes because it had not received sufficient notice of that theory of liability. The court therefore declined to adopt the expanded class definition.

Standing

Standing is the requirement that a plaintiff show an actual injury, a connection between that injury and the defendant’s conduct, and a likelihood that a favorable decision would remedy the injury. Invitation Homes argued that Rivera lacked standing because he never signed a lease with Invitation Homes and was never charged or paid a late fee by it.

The court agreed. Rivera signed a 2013 lease with Colony American Homes that required a $50 late fee and later signed a 2016 lease with Waypoint Homes that included a $95 late fee. He paid his last late fee around February 2017 while renting under the Waypoint lease. The record showed that Invitation Homes began implementing its standardized national lease with a $95 late fee for California properties in August 2018. Rivera did not dispute that he never leased from or paid a late fee to Invitation Homes.

The court concluded that Rivera’s alleged injury was not traceable to Invitation Homes’ late-fee policy. Because Rivera was the only named plaintiff and lacked standing from the outset, he could not represent the proposed class. The court held that dismissal was proper and that substitution of another named plaintiff was not required. It therefore did not decide the merits of class certification or the remaining Rule 23 requirements.

Disposition

The court dismissed the action and denied Rivera’s motion for class certification. The court also addressed Invitation Homes’ motion to seal materials filed with its opposition. Because Rivera apparently was the party that designated the information as confidential but had not submitted the required supporting statement or declaration, the court gave him five days to do so. If he did not, the sealing motion would be denied and the documents would be filed in the public record. The court ordered that a separate judgment issue and that the clerk close the file.