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Class Action Defense Cases-CE Design v. Mortgage Exchange: Illinois State Appellate Court Dismisses Petition Seeking Leave To Appeal Denial Of Class Action Treatment Agreeing With Defense That Petition Was Untimely

Petition Seeking Review of Trial Court Order Denying Motion to Certify Class Action was Untimely thus Compelling Dismissal of the Petition for Lack of Jurisdiction

Plaintiffs filed a putative class action lawsuit in Illinois state court against The Mortgage Exchange alleging violations of the federal Telephone Consumer Protection Act of 1991 (TCPA) and the state’s consumer fraud and deceptive business practices arising out of defendant’s transmission of unsolicited advertisements via facsimile. CE Design, Ltd. v. The Mortgage Exchange, Inc., 872 N.E.2d 1056, 1057 (Ill.App. 2007). Plaintiffs moved the trial court for an order certifying the litigation as a class action; defense attorneys opposed the motion on the grounds, inter alia, that “issues such as the specific receipt of and consent to receive a facsimile transmission by each class member were not common issues.” Id., at 1057-58. On October 13, 2006, the trial court agreed with the defense and refused to certify a class action holding, also, that class action treatment was inappropriate because in enacting the TCPA Congress “envisioned individual, small claims litigation, not private class actions with potential recoveries in the millions of dollars.” Id., at 1058. Plaintiffs sought reconsideration of the denial of class certification, which the trial court denied on February 22, 2007. Plaintiffs sought leave to appeal the denial of class action treatment, and defense attorneys moved to dismiss plaintiffs’ petition for lack of jurisdiction. Id. The appellate court granted the defense motion holding that plaintiffs’ petition was untimely.

Under Illinois state court rules, plaintiffs’ petition had to be filed “within 30 days after the entry of the order”; plaintiffs acknowledge that they failed to meet this deadline but argued the time for filing the petition was tolled during the pendency of the motion for reconsideration, or alternatively that the motion for reconsideration was a “new motion” for certification of a class action. CE Design, at 1059. The appellate court rejected each argument. With respect to the tolling argument, the appellate court observed that “[t]here is no provision in the rule that allows a motion to reconsider an interlocutory order to extend the time for filing the petition for leave to appeal,” and that case law holds that the time period is not tolled. Id. (citations omitted). The court was unconvinced that motions to reconsider class certification orders should be an exception to this rule. Id., at1060.

With respect to plaintiffs’ claim that the motion for reconsideration was actually a “new” motion, and that the petition was timely filed from the denial thereof, the appellate court distinguished the case relied upon by plaintiffs (which, incidentally involved three motions and an appeal from one of the earlier orders), explaining at page 1061, “plaintiffs did not seek to appeal the order denying their motion to certify the class” but instead “within 30 days of that order, they sought reconsideration” based on their belief that the original motion had been wrongly denied based on “legal error.” In other words, the motion for reconsideration “simply attempted to point out to the trial court why it erred in interpreting existing authorities” and did not introduce new factual matter or cite to a change in the law.” Id. Accordingly, the 30-day period for appealing the denial of the motion to certify a class action did not begin to run anew, leaving the appellate court without jurisdiction to consider plaintiffs’ untimely petition. Id.

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