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Mark Maniscalco, et al v. Brother International Corporation (Usa

June 24, 2011

MARK MANISCALCO, ET AL., PLAINTIFFS,
v.
BROTHER INTERNATIONAL CORPORATION (USA), DEFENDANT.



The opinion of the court was delivered by: Wolfson, United States District Judge:

FOR PUBLICATION

OPINION

Presently before the Court is a Motion for Summary Judgment by Defendant Brother International Corporation ("BIC" or "Defendant") as well as a Motion to Strike Portions of Defendant's Reply by Plaintiffs Mark Maniscalco ("Mr. Maniscalco") and Walter Huryk ("Mr. Huryk")(collectively "Plaintiffs"). The instant motions arise out of a Complaint by Plaintiffs on behalf of themselves, as well as a putative class of consumers, alleging defects relating to a line of Multi-Function Center ("MFC") machines distributed by BIC. Specifically, Plaintiffs contend that BIC concealed or failed to disclose two design defects present in the MFC machines and, as a result, that Plaintiffs are entitled to relief under the New Jersey Consumer Fraud Act, N.J.S.A. § 56:8-2 ("NJCFA"). The alleged defects at issue are: (1) a defect that caused printer heads to fail and to display the message "Machine Error 41" ("ME41") before the end of their expected useful life; and (2) a defect that caused the MFC machines to purge excess amounts of ink.*fn1 For the reasons that follow, the Court finds that the New Jersey Consumer Fraud Act ("NJCFA") does not apply to Plaintiffs' claims, and, therefore, the Court grants Defendant's motion for summary judgment and dismisses Plaintiffs' only remaining cause of action under the NJCFA.*fn2

I. FACTUAL BACKGROUND

BIC, a Delaware corporation with a principal place of business in New Jersey, is the distributor of MFC machines that are manufactured and designed by Brother Industries, Ltd. ("BIL"), BIC's parent entity in Japan. The MFC machines at issue function as printers, fax machines, scanners and copiers. BIC began distributing the relevant MFC machines -- the Brother 3220C-- in or around August or September 2001.*fn3 Pls' Fact Statement ¶ 20. Each MFC machine was accompanied by a Limited Warranty and a User Manual drafted by BIL. Def's Fact Statement ¶ 4.

In relevant part, the Limited Warranty provided that each Brother 3220C would be "free from defects in materials and workmanship, when used under normal conditions" for one year while any consumable and accessory items would be warranted for 90 days. Def's Fact Statement ¶¶ 24, 108. Under the Limited Warranty, BIC agreed to repair or replace the MFC machine or the relevant consumable or accessory item so long as the defect was reported to BIC or an authorized service center within the applicable warranty period. Def's Fact Statement ¶¶ 25, 109; Pls' Resp. Fact Statement ¶¶ 25, 109.

In addition, the User Manual for the Brother 3220C machine provided specific information about the number of pages that a user could expect to print from a Brother brand cartridge when used in the MFC 3220C. Specifically, at two distinct locations in the Manual, the user was advised that he should be able to print "up to 500 pages" from each Brother-brand black cartridge and "up to 400 pages" from each cyan, magenta or yellow cartridge. Def's Fact Statement ¶ 20. Moreover, the User Manual expressly stated that "[t]o ensure good print quality, the machine will regularly clean the print head." McDonald Cert., Ex. 8 at 12-11. In addition, in at least two distinct locations the Manual explained that the process of cleaning the print head consumes ink. Specifically, on page 12-11, the Manual notes that "[c]leaning the print head consumes ink. Cleaning too often uses ink unnecessarily," while in section S-8 the Manual states that "the machine periodically cleans the print head to maintain print quality. This process consumes a small amount of ink." Def's Fact Statement ¶ 22; McDonald Cert., Ex. 8 at 12-11, S-8.

A. The Defects

i. ME41 Defect

In or around late 2001, BIC began receiving calls regarding the appearance of an error message on certain MFC machines. Pls' Fact Statement at ¶ 19. The message, referred to as the ME41 error message or ME41 defect, indicated a voltage issue occurring within the print heads of affected machines. Stadler Dep. 9:17-19. Specifically, if the print head voltage failed to turn from low to high within a specified period of time, the affected machines would display the ME41 message and the machine would stop printing and would not resume printing until the message error was cleared. Stadler Dep. 9:24-10:3, 10:24-11:1. The ME41 message appeared regardless of whether the affected print head was temporarily or permanently out of order. Pls' Fact Statement ¶ 3. In instances when a print head ceased functioning temporarily, the error message could be cleared simply by rebooting the machine -- i.e. unplugging the machine and turning it on again. Stadler Dep. 10:4-6. However, if the MFC print head had permanently ceased functioning, the print head would have to be replaced to resolve the ME41 message and defect. Stadler Dep. 12:3-9.

In 2001, BIC received 19 calls regarding the ME41 message. Pls' Fact Statement ¶ 19. By June 2002, the ME41 message was being investigated by BIC technical support in New Jersey. Pls' Fact Statement ¶ 21. In August 2002, BIC knew that some customers "were having a Machine Error 41, which is related to the print head," but did not know the cause of the ME41 error since such an error "could be caused by many different things." Stadler Dep. 141:3-8.

Thereafter, in August 2002, BIC submitted a fault report to BIL to "bring to the attention of BIL the quality issues or customer calls that [BIC was] receiving." Pls' Fact Statement ¶ 23; Stadler Dep. 24:13-17. Indeed, in an attempt to solve the ME41 issue, BIL began to investigate the error message and BIC "provide[d] information to BIL and occasionally sen[t] [BIL] sample machines." Stadler Dep. 32:12-14. In November 2002, while the ME41 investigation was ongoing, BIL provided a "temporary troubleshooting guide" to BIC with potential solutions and countermeasures that BIC field personnel could implement if they encountered the ME41 defect. Stadler Dep. 61-64.

On March 13, 2003, BIC opened another Fault Report concerning ME41. Pls' Fact Statement ¶ 43. In March 2003, the ME41 issue was the "number 1 quality issue on this product." Pls' Fact Statement ¶ 46. On November 11, 2003, BIC opened another fault report for ME41. Pls' Fact Statement ¶ 48. By December 2003, BIC knew that the ME41 issue was still occurring and began to extend the warranty on affected machines to 18 months for the ME41 defect "and requested warranty reimbursement and a no-cost print head from BIL." Pls' Fact Statement at 49; Stadler Dep: 166:9-20. In May 2004, BIL advised BIC that it knew the cause of the ME41 defect but did not know how to fix it. Pls' Fact Statement ¶ 56.

In December 2004, BIC acknowledged that there was a significant number of "unhappy" customers to warrant the implementation of a procedure where a supervisor or manager could authorize a repair at no cost. Pls' Fact Statement ¶ 85. In addition, BIC lowered the cost of replacement print heads from $129.99 to $29.99 and $19.99. Pls' Fact Statement ¶ 86.

In or around early 2005, BIL began to consider recalling the affected machines. Pls' Fact Statement ¶ 144. Because of concerns about the public perception of a recall, BIC attempted to convince BIL not to have the recall. Id. ¶¶ 145,146.

Thereafter, in February 2005, BIC extended the print head warranty for ME41 defects to 24 months from the date of purchase. Pls' Fact Statement ¶ 94. To inform purchasers of the warranty extension, BIC sent e-mail notice of the warranty extension to 50,718 registered customers that were still within the 24 month extended warranty. Id. ¶ 109. In addition, in March 2005, BIC mailed a postcard to between 40,000 and 56,000 registered customers who were still within the 24 month extended warranty and for whom it did not have an e-mail address. Id. ¶ 112. However, BIC did not provide notice of the warranty extension to consumers who were no longer within the warranty period. Pls' Fact Statement ¶ 116.

BIL eventually discovered a permanent fix for the ME41 defect in June 2005 that involved changing the applied voltage on the MFC from 120 to 95 volts. Stadler Dep. 33:19-36:25. The voltage change, however, was only incorporated into the production of new MFC machines; if an existing MFC machine displayed the ME41 message, the only permanent fix for the machine was to replace the print head. Stadler Dep. 37:7-14.

ii. Ink-Purging Defect

In addition to the ME41 defect, Plaintiffs contend that BIC failed to disclose the existence of a software defect in some MFC machines that would cause the machines to purge excess amounts of ink. Pls' Fact Statement ¶ 190. In or around August 2, 2004, BIC's New Zealand counterpart opened a Fault Report to launch an investigation into the cause of the ink-purging defect. Pls' Resp. Fact Statement at ¶ 20. The Fault Report noted that certain "machines are purging ink too often and emptying all the ink cartridges within 7 months or less, but the specifications found with the MFC 3220C service manual states that the ink should last 20 month[]s plus on color and 15 months based on purging only . . . worst cases have included the machine cleaning the inks to the point of coming up empty without the End User printing a single page." Pls' Resp. Fact Statement ¶ 20; Pls' Ex. 30 at 2446593. The Fault Report additionally noted that the same Fault was found in BI Austria and BI Netherlands. Pls' Ex. 30 at 2446593.

By September 2004, BIC knew the ink purging defect was affecting MFC machines. Pls' Resp. Fact Statement ¶ 20. Indeed, in September 2004, BIL introduced modified software intended to address the ink-purging defect. Pls' Fact Statement ¶ 198. Initially, BIC made this software available to its authorized service centers to provide to customers who brought their machines in for repair. Pls' Statement of Facts 218. In Mach 2005, BIC created a CD containing the modified software that it provided to owners for self-installation. Id. In June 2005, BIC posted the revised software to its website to ensure that machine owners could download and install the software themselves. Id. at 219. BIC, however, did ...


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