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The Franchise Memorandum

Class Certification Denied for Independent Apple Specialists
Posted in Class Actions

A California state appellate court affirmed the denial of a motion for class certification for a group of independent Apple dealers (known as Specialists) in Siechert & Synn v. Apple, Inc., 2015 WL 513645 (Cal. Ct. App. Feb. 6, 2015). The plaintiffs failed to show that common questions predominated over individual issues or that a class action would be superior to individual suits. The court also found that facts related to the statute of limitations, causation, and alleged misrepresentation should all be determined on an individual basis.

All of the plaintiffs were in the business of selling Apple products and claimed that Apple's decision to open its own retail stores was part of a fraudulent scheme to drive independent Apple Specialists out of business. Some of the plaintiffs published their opinions on this issue on an Apple Specialist listsery as early as 2001. This led the court to conclude that each plaintiff would be required to individually prove delayed discovery in order to overcome Apple's statute of limitations defense. The plaintiffs argued that class-wide reliance on Apple's representations should be presumed because Apple made similar statements to each of the Specialists. However, the plaintiffs' deposition testimony indicated that they recalled different representations, thereby distinguishing this case from others in which there was evidence that uniform representations were made to each putative class member. The court also found that each plaintiff would need to separately prove that the alleged fraud caused their losses as opposed to other variable factors such as the individual store's market, location, local economy, level of service, and management expertise. Finally, the court held that there was no commonality among the high-demand products the retailers claimed were withheld from their stores. Instead, a "Specialist-by-Specialist and product-by-product" inquiry would be required for each plaintiff to prove actual damages.

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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

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