Credit: Sergey Toronto/

A Newark federal judge has certified a class of residents of an Avalon Bay Communities Inc. apartment complex in Edgewater, who filed a lawsuit over a catastrophic fire that left them temporarily homeless.

The suit, Katz v. Avalon Bay Communities, stems from a January 2015 fire in the complex known as Avalon at Edgewater, which consisted of two four-story buildings. The fire destroyed one building, known as the Russell Building, and damaged the other, known as the River Building. Avalon Bay settled a class action by residents of the Russell Building, DeMarco v. Avalon Bay Communities, in 2016. On Oct. 24, Chief U.S. Judge Jose Linares granted certification to a class of tenants and residents of the River Building.

Residents of the River Building sought compensation for what they say is a diminished rental value of their apartments after the fire, and for the loss of certain luxury amenities. They also claim new tenants are charged lower rent than those who moved in before the fire. They also sought compensation for expenses incurred as a direct result of the fire, such as lodging, food, clothing, transportation, medicine and lost wages during the four-day period when they were displaced.

Residents claim their building has a pervasive odor, water and smoke damage, and accumulation of soot because of the fire. Avalon Bay claims it took steps to clean the River Building apartments, eliminate odors and to make it safe for residents, and that it gave concessions and credits to cover losses from the four-day displacement.

Avalon Bay has been plagued by fires in its apartment buildings. In 2000, another fire destroyed the Russell building while it was under construction, and also destroyed nine nearby homes, according to press accounts. Another building under construction by the company in Maplewood was heavily damaged by fire in 2017.

Plaintiffs brought claims for common-law negligence, private nuisance and breach of contract. They claimed Avalon Bay was liable for the losses because it constructed the buildings of lightweight wood that is known to be flammable. They also asserted that Avalon failed to install adequate sprinklers in some areas of the buildings, and that it lacked proper fire walls, fire dampers and fire doors. They also claimed the workers who started the fire while soldering pipes in an apartment bathroom failed to promptly call 911.

The plaintiffs sought certification of a class consisting of both tenants and occupants of the River Building, or, alternately, separate subclasses of tenants and occupants. However, Linares said creating subclasses for tenants and occupants “would risk Balkanizing the class and introducing a huge obstacle to settlement.” In addition, a class of occupants alone might not satisfy the Rule 23 requirement for numerosity, he said. Therefore, Linares certified a class consisting of people who, on the day of the fire, were tenants or occupants as identified on the operative lease agreements.

Linares found the case met the standards for ascertainability, numerosity, adequacy and typicality to warrant class certification, rejecting the defendant’s claims that those standards were not met.

The numerosity standard was met because 165 apartments in the River Building were occupied at the time of the fire, and six of those have reached individual settlements with the defendant, Linares said. That’s enough to meet the minimum threshold of 40 potential plaintiffs, at which a class is presumed to meet the numerosity standard.

Linares rejected the defendants’ claim that plaintiffs’ claims should be joined with a group of subrogation suits that were consolidated into one case in state court. “Those proceedings have little bearing on the certification of a class of tenants and occupants asserting their own tort and contract claims against Defendant for their own losses,” Linares said.

Linares also rejected the defendant’s claims that class representatives Katherine Katz and Yudenia Mesa are inadequate representatives because they abandoned claims for negligent infliction of emotional distress. Linares said the defendant was conflating negligent infliction of emotional distress as a cause of action with pain and suffering or emotional harm as a form of damages. Plaintiffs may have abandoned the former, but have not abandoned the latter, he said.

Linares also rejected Avalon Bay’s claim that the class counsel, Ralph Ferrara, Aaron Peskin and Joshua Beisler of Ferrara Law Group in Trenton, were inadequate because of limited experience litigating class actions. The judge said class counsel have “decades of experience practicing complex litigation” and are currently counsel of record in two other class actions.

Ferrara said the next step in the case would be discovery into issues of liability and damages. He declined to speculate on exposure faced by the defendant in the case.

“We’re very happy for the residents. We’re happy the court agreed with us from the class action perspective and we look forward to continuing to represent the class’s interests,” Ferrara said.

Daniel DiMuro and Ronald Giller of Gordon Rees Scully Mansukhani in Florham Park, who represent Avalon Bay, did not return calls about the ruling.