The District of Massachusetts recently issued an opinion decertifying a class of medical students formerly enrolled at Saba University School of Medicine, a for-profit medical school in the Dutch Caribbean that is headquartered in Massachusetts.

The reversal followed the court’s initial tentative certification under Federal Rule 23, issued from the bench immediately after oral argument. Judge Young explained that, while writing the certification decision, he observed a fatal flaw that prevented the certification of Ortiz’s consumer protection claims for a nationwide class of former medical students. The decertification decision in Ortiz v. Saba University School of Medicine thus followed.

Ortiz’s Consumer Protection Claims Received Preliminary Certification

Ortiz filed the claim on her own behalf and other similarly situated students. As a former student of Saba, Ortiz pursued consumer protection claims alleging that Saba falsely advertised to prospective students by touting a misleading passage rate of 95-100% for its students for the first professional licensure exam (USMLE Step 1) taken after the first five semesters of medical school.

Ortiz contended that the admissions representation that “virtually every Saba student passes the USMLE on their first attempt” misleadingly omitted that Saba only permitted students with qualifying grades to sit for the exam and, as a result, only 50% of students at Saba ultimately sit for the exam. These numbers contrast with the average of 89.3% of students at all American medical schools who sit for the exam, 85.6% of whom pass. Ortiz contended she enrolled at Saba based on the advertised 95-100% passage rate, which she believed was indicative of the quality of Saba’s education, not of the barriers it placed on which students could sit for the exam.

After completing her first five semesters at Saba, Ortiz failed to qualify for testing within three attempts and was dismissed in accordance with Saba’s policies. Ortiz claims that she would not have taken out hefty student loans and matriculated at Saba if she had been aware that only half of Saba’s students sat for the exam.

Ortiz sought damages from Saba and other relief — including an injunction against Saba continuing its allegedly deceptive advertisement — based on her claim that advertisements about its near-100% pass rates misleadingly omitted that only 50% of students sit for the exam. On September 17, 2024, following oral argument, the court under Rule 23 tentatively certified a class of former Saba medical students who did not sit for the USMLE Step 1 exam.

Claims of Former Saba Medical Students Met the Requirements of Federal Rule 23(a)

After the court tentatively granted certification, Saba filed a petition for interlocutory review with the First Circuit pursuant to Rule 23(f). Generally, jurisdiction over the order on class certification no longer rests with the federal district court once the appeals court accepts the petition seeking interlocutory review. Here, the First Circuit had not yet accepted jurisdiction over Saba’s appeal, so the District of Massachusetts retained jurisdiction to decertify the class pursuant to Rule 23(c)(1)(C).

In his written decision, Judge Young explained that Ortiz had met the requirements of Rule 23(a) for class certification. As to numerosity under Rule 23(a)(1), based on Saba’s records, at least 500 former students met the class definition, making joinder impracticable. For Rule 23(a)(2) commonality, there was a “common core of salient facts” about Saba’s representation of its USMLE Step 1 pass rates. Under a Rule 23(a)(3) analysis for typicality, because Ortiz’s claims were based on the same factual and legal premises as those of the proposed class members (including the same alleged marketing misrepresentations and harm from the same), as lead plaintiff Ortiz could “fairly and adequately pursue the interests of the absent class members without being sidetracked by her own particular concerns.” And because Saba did not challenge the adequacy of Ortiz or her counsel to represent the putative class, the Rule 23(a)(3) adequacy requirement was deemed met.

Former Saba Medical Students Could Not Satisfy Predominance Under Federal Rule 23(b)(3)

Despite the smooth sailing through certification analysis under Rule 23(a), Ortiz’s claims met an abrupt end at Rule 23(b)(3). Under Rule 23(b)(3), a plaintiff must demonstrate that “the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.”

In opposing class certification, Saba highlighted material differences between Massachusetts’ Chapter 93A consumer protection statute and other states’ consumer protection laws. The court warned that “divergent state laws can swamp any common issues and defeat predominance” and that a “rigorous analysis of the relevant laws of the states at issue” must follow when claims “involve plaintiffs from multiple jurisdictions” because “the predominance requirement cannot be met when the various laws have not been identified and compared.”

Plaintiffs seeking class certification bear that burden and here, the court observed that—although the parties did not dispute that a material conflict exists between Massachusetts law and the laws of the class members’ home states—Ortiz did not conduct any analysis of state law variation.

The court concluded that Massachusetts choice-of-law principles consistently favor applying the consumer’s home state laws to consumer fraud claims and applying Massachusetts’ Chapter 93A across all states would undermine each state’s ability to enforce its own standard. Because the differences in state and national laws would predominate over common issues, the court determined the predominance requirement of Rule 23(b)(3) was not satisfied and a nationwide class could not be certified.

The Saba decision highlights just one of the many challenges that plaintiffs face when pursuing nationwide consumer class actions in state and federal Massachusetts courts. As Judge Young observed, the decision also “illustrates the power of oral argument” and the critical importance for defense counsel to identify, preserve, and pursue Rule 23 issues on federal district court reconsideration and appellate review.