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Dzielak v. Whirlpool Corp.

United States District Court, D. New Jersey

December 20, 2017

CHARLENE DZIELAK, SHELLEY BAKER, FRANCIS ANGELONE, BRIAN MAXWELL, JEFFERY REID, KARI PARSONS, CHARLES BEYER, JONATHAN COHEN, JENNIFER SCHRAMM, and ASPASIA CHRISTY on behalf of themselves and all others similarly situated, Plaintiffs,
v.
WHIRLPOOL CORPORATION, SEARS HOLDINGS CORPORATION, THE HOME DEPOT, INC., FRY'S ELECTRONICS, INC., APPLIANCE RECYCLING CENTERS OF AMERICA, INC., and LOWE'S HOME CENTER, LLC, Defendants.

          OPINION

          KEVIN MCNULTY UNITED STATES DISTRICT JUDGE.

         This motion for class certification arises from the sale of Maytag washing machines that bore ENERGY STAR® ("Energy Star") labels signifying that they met federal standards of water and electrical efficiency. Defendants had already been selling Maytag washing machines with the Energy Star label when, in May 2012, the U.S. Department of Energy determined that those particular models did not actually meet the Energy Star efficiency standards. Plaintiffs seek to represent a putative class whose members allegedly suffered uniform harm because they all purchased washers improperly labeled with the Energy Star logo. They claim two harms: (1) that the price of the washers was inflated because consumers pay a premium for Energy Star qualified machines and (2) that each purchaser "paid more money in additional water and energy costs to operate his or her Mislabeled Washing machine" than he or she would have if the washers had actually met the Energy Star standards. (2AC ¶ 118).[1]

         This opinion addresses plaintiffs' renewed motion for class certification.

         I. BACKGROUND

         Familiarity with my earlier opinions (MTD Op.; Daubert Op.; Preemption Op.) is assumed. I canvass here only the facts and procedural history pertinent to my decision on class certification.

         The named plaintiffs, purchasers of Maytag washing machines, are Charlene Dzielak, Francis Angelone, Shelley Baker, Brian Maxwell, Jeffery Reid, Kari Parsons, Charles Beyer, Jonathan Cohen, Jennifer Schramm, and Apasia Christy. (MTD Op. 1; 2AC ¶¶ 8-18). Defendant Whirlpool Corporation ("Whirlpool") manufactured the relevant washers. (MTD Op. 1). The remaining defendants are retailers from whom the plaintiffs purchased the machines: Lowe's Home Center, LLC ("Lowe's"), Sears Holding Corporation ("Sears"}, The Home Depot, Inc. ("Home Depot"), Fry's Electronics, Inc. ("Fry's"), and Appliance Recycling Centers of America, Inc. ("ARCA"). (Id. at 1-2; 2AC ¶¶ 19-24).

         Each Maytag washing machine at issue in this case bore an Energy Star label at the time of purchase. [Id. at 2). Energy Star machines must use approximately 37% less energy and 50% less water than standard models. (Id. at 4). Thereafter, however, the Department of Energy determined that the washers at issue did not comply with Energy Star requirements, and the EPA then disqualified them from the program. (Id. at 2).

         The putative class comprises seven subclasses of purchasers in all states where named plaintiffs bought washers-New Jersey, California, Florida, Ohio, Indiana, Texas, and Virginia. (PL Br. 4); (PL Reply to Whirlpool 13). Plaintiffs allege two harms: (1) a price premium they attribute to the Energy Star label and (2) higher water and energy costs than they would have paid had the washers actually met the Energy Star standards. (Weir Decl. ¶¶ 14-53).

         The claims that remain at this stage are as follows:

Count II: Breach of Express Warranty
Count III: Breach of Implied Warranty of Merchantability (for NJ, IN, TX, and VA plaintiffs only)
Count IV: Unjust Enrichment (asserted against retailers only; not against Whirlpool)
Count V: New Jersey Consumer Fraud Act, N.J. Stat. Ann. § 56:8-1, et seq. ("NJCFA")
Count VI: New Jersey Truth-in-Consumer Contract, Warranty, and Notice Act, N.J. Stat. Ann. § 56:12-14, et seq. ("TCCWNA")
Count VII: California's Consumer Legal Remedies Act, Cal. Civil Code § 1750, et seq. ("CLRA")
Count VIII: California's Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, et seq. ("UCL")
Count IX: California's False Advertising Law, Cal. Bus. & Prof. Code § 17500, et seq. ("FAL")
Count XI: Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. § 501.201, et seq. ("FDUTPA")
Count XII: Ohio Consumer Sales Practices Act, Ohio Rev. Code Ann. § 1345.01, et seq. ("OCSPA")
Count XIII: Indiana Deceptive Consumer Sales Act, Ind. Code Ann. § 24- 5-0.5-1, et seq. ("IDCSA")
Count XIV: Texas Deceptive Trade Practices Act, Tex. Bus. & Com. Code § 17.41, et seq. ("DTPA").[2]

(2AC); (MTD Op.). Plaintiffs now move for class certification under Rule 23(b)(3). Defendants argue that plaintiffs have not satisfied the requirements for class certification.

         II. JURISDICTION

         The Court has jurisdiction over this motion for class certification under the Class Action Fairness Act of 2005 ("CAFA"), 28 U.S.C. §§ 1332(d), 1453, 1711-15. CAFA confers jurisdiction on federal courts over certain class actions in which die matter in controversy exceeds $5 million, exclusive of interest and costs, and minimal diversity is present, i.e., any defendant's citizenship is diverse from that of any plaintiff. Id. § 1332(d)(2).

         III. LEGAL STANDARD

         The class action is "an exception to the usual rule that litigation is usually conducted by and on behalf of the individual named parties only." Comcast Corp. v. Behrend, 569 U.S. 27, 33 (2013) (citing Califano v. Yamaski, 442 U.S. 682, 700-01 (1979)). Accordingly, a plaintiff bears the burden of affirmatively demonstrating by a preponderance of evidence that her putative class satisfies the class-certification requirements in Federal Rule of Civil Procedure 23. Byrd v. Aaron's Inc., 784 F.3d 154, 163 (3d Cir. 2015). Importantly, Rule 23 "does not set forth a mere pleading standard." Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 (2011). Rather, die plaintiff must prove that the Rule 23(a) requirements are met. Comcast, 569 U.S. at 33.

         First, to qualify for class certification, a party must demonstrate that the putative class meets die four requirements set forth in Rule 23(a):

(1) die class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of die representative parties are typical of die claims or defenses of die class; and
(4) the representative parties will fairly and adequately protect die interests of die class.

Fed. R. Civ. P. 23(a); see Dukes, 564 U.S. at 345. The Rule 23(a) factors are referred to as numerosity, commonality, typicality, and adequacy of representation.

         The Supreme Court has emphasized that it "may be necessary for the court to probe behind the pleadings before coming to rest on the certification question" and that certification is proper only if "the trial court is satisfied, after a rigorous analysis" that Rule 23(a) 's prerequisites have been met. Comcast, 569 U.S. at 33 (quoting Gen. Tel. Co. of Southwest v. Falcon, 457 U.S. 147, 160-61 (1982)). Such an analysis will "entail some overlap with the merits of the plaintiffs underlying claim." Dukes, 564 U.S. at 351.

         Second, a plaintiff must satisfy at least one of the three requirements listed in Rule 23(b). Id. at 345-46. In this action, plaintiffs seek to certify the class under Rule 23(b)(3), which permits certification when (1) "the questions of law or fact common to class members predominate over any questions affecting only individual members, " and (2) "a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3). The Rule 23(b)(3) analysis of predominance and superiority is more demanding than the Rule 23(a) analysis. Comcast, 569 U.S. at 34 (citing Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623-24 (1997)). In particular, courts have a duty to take a close look at whether common questions predominate over individual ones. Dukes, 564 U.S. at 362.

         In the Third Circuit, Rule 23(b)(3) certification also involves an independent ascertainability inquiry, which requires a plaintiff to show that (1) the class is "defined with reference to objective criteria" and (2) there is "a reliable and administratively feasible mechanism for determining whether putative class members fall within the class definition." Byrd, 784 F.3d at 163 (citing Hayes v. Wal-Mart Stores, Inc., 725 F.3d 349, 355 (3d Cir. 2013)). The parties do not seem to dispute this issue, however.

         IV. RULE 23(A) REQUIREMENTS

         As stated above, a plaintiff seeking to certify a class first must satisfy Rule 23(a)'s four requirements: numerosity, commonality, typicality, and adequacy of representation. All must be proven by a preponderance of the evidence. Hydrogen Peroxide, 552 F.3d 305, 307 (3d Cir. 2008). Defendants claim that plaintiffs have not met their burden regarding commonality, typicality, and adequacy. (Def. Br. 11 n.8).[3]

         A. Numerosity

         Rule 23(a)(1) requires a finding that "the class is so numerous that joinder of all members is impracticable." That requirement promotes judicial economy by avoiding onerous (anti-)joinder rules and eliminating the need to adjudicate numerous similar actions separately. See Marcus v. BMW of N. Am., LLC, 687 F.3d 583, 594-95 (3d Cir. 2012). Furthermore, it enhances access to judicial relief, particularly when individual claims would be uneconomical to litigate individually, and, where joinder can be easily accomplished, prevents putative class representatives and counsel from denying members of a small class from adjudicating their claims individually. Id.

         As a general rule, a potential class with as few as forty members may meet the numerosity requirement. Id. at 595 (citing Stewart v. Abraham, 275 F.3d 220, 226-27 (3d Cir. 2001)). Nonetheless, Rule 23(a)(1) "requires examination of the specific facts of each case." Gen. Tel. Co. of Northwest v. EEOC, 446 U.S. 318, 330 (1980). Additionally, numerosity is not inferred for state-specific subclasses simply because there is a nationwide or larger class; there needs to be state-specific evidence for each subclass. Marcus, 687 F.3d at 585.

         Plaintiff has satisfied the numerosity requirement by providing documentation that approximately 174, 974 units of allegedly mislabeled washers were sold in the seven states during the class period. (Weir Decl. ¶ 49); (Bursor Decl. Ex. 18). Plaintiffs provide data for each individual state, which allows me to determine that the numerosity requirement is met for each state- specific subclass as well. Therefore, plaintiffs have proven Rule 23(a) *s numerosity requirement. (Bursor Decl. Exs. 17, 18).[4]

         B. Commonality

         Rule 23(a)(2) requires a showing of "questions of law or fact common to the class." "Commonality requires the plaintiff to demonstrate that the class members "have suffered the same injury.'" Dukes, 564 U.S. at 349-50 (citing Falcon, 457 U.S. at 157). The claims must rest upon a "common contention" that is capable of classwide resolution:

What matters to class certification ... is not the raising of common "questions"-even in droves-but, rather the capacity of a classwide proceeding to generate common answers apt to drive the resolution of the litigation. Dissimilarities within the proposed class are what have the potential to impede the generation of common answers.

Id. at 350 (citing Richard A. Nagareda, Class Certification in the Age of Aggregate Proof 84 N.Y.U. L. Rev. 97, 132 (2009)).

         Importantly, the commonality requirement does not require that class members share identical claims. In re Prudential Ins. Co. Am. Sales Practice Litig. Agent Actions, 148 F.3d 283, 310 (3d Cir. 1998). "[F]actual differences among the claims of the putative class members do not defeat certification." Id. (citing Baby Neal v. Casey, 43 F.3d 48, 56 (3d Cir. 1994)). Commonality is addressed at a fairly high level of generality and is less stringent than the Rule 23(b)(3) predominance requirement. See Amchem Prods, Inc., 521 U.S. at 609.

         What is required is that the named plaintiffs share at least one question of fact or law with the prospective class. See Rodriguez v. Nat'l City Bank, 726 F.3d 372, 382 (3d Cir. 2013). In fact, "the focus of the commonality inquiry is not on the strength of each plaintiffs claim, but instead is 'on whether the defendant's conduct was common as to all of the class members.™ Id. (citing In re Prudential, 148 F.3d at 311).[5]

         In this case, there are common questions whose resolution would drive the resolution of this litigation. Such common questions include whether the Energy Star mark and advertising material were material to class members' decisions to purchase the machines; whether the class members paid a price premium because of the Energy Star label; and whether class members paid more in energy and water bills because the washers were mislabeled. Therefore, this putative class satisfies Rule 23(a)'s commonality requirement.

         C. Typicality

         The Rule 23(a)(3) test for typicality requires that the claims or defenses of the named plaintiffs are "typical of the claims or defenses of the class." Fed.R.Civ.P. 23(a)(3). "The typicality requirement is designed to align the interests of the class and the class representatives so that the latter will work to benefit the entire class through the pursuit of their own goals." In re Prudential, 148 F.3d at 311; see also Rodriguez, 726 F.3d at 376 n.4 (citing Eisenberg v. Gagnon, 766 F.2d 770, 786 (3d Cir. 1985)). Typicality does not require that the putative class members all share identical claims. In re Warfarin Sodium Antitrust Litig., 391 F.3d 516, 531-32 (3d Cir. 2004). Rather, the typicality requirement, which tends to overlap with the adequacy and commonality determinations, seeks to assure that absent class members will be adequately represented. Rodriguez, 726 F.3d at 376 n.4; Eisenberg, 766 F.2d at 786.

         In this case, the claims of the representative plaintiffs all arise from the same allegedly wrongful conduct-the alleged misrepresentation that the washers were Energy Star qualified.[6] The claims arise under the same general legal theories. Overall, while there are some factual differences between the named plaintiffs' claims and those of other class members, the named plaintiffs have claims that are sufficiently typical of the putative class. Therefore, I find that the putative class satisfies Rule 23(a)(3) typicality.

         D. Adequacy of Representation

         Rule 23(a)(4) requires that the "representative parties will fairly and adequately protect the interests of the class." The adequacy inquiry has two components designed to ensure that absent class members' interests are fully pursued: (1) whether counsel is qualified to represent the class and (2) whether there are conflicts of interest between named parties and the putative class they seek to represent. In re Warfarin, 391 F.3d 516 (citing In re Prudential, 148 F.3dat313).

         First, the putative class counsel includes qualified and experienced class action attorneys who have been involved in similar litigation around the country. Putative class counsel have pursued this litigation vigorously for several years. Second, there are no apparent conflicts of interest between the named plaintiffs and the classes they seek to represent. The named plaintiffs bought the same washer models as the other class members, and they claim the same relief that the putative class would receive. As a result, I find that the class counsel and named plaintiffs will fairly and adequately represent the interests of the class.

         In sum, I find that the putative class satisfies the four threshold Rule 23(a) class-certification requirements of numerosity, commonality, typicality, and adequacy of representation-at least against Whirlpool. (More about the retailers later.) I will now evaluate whether plaintiffs satisfy the requirements of Rule 23(b)(3).

         V. RULE 23(B)(3) REQUIREMENTS

         In addition to satisfying the four Rule 23(a) requirements, a plaintiff seeking class certification must satisfy at least one of the three requirements listed in Rule 23(b). In this action, plaintiffs seek Rule 23(b)(3) certification, which requires (A) "that the questions of law or fact common to class members predominate over any questions affecting only individual members, " and (B) that "a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3).[7] Although the requirements are distinct, many considerations are relevant to both, so some overlap in the discussion is unavoidable.

         A. Predominance

         To be certified as a Rule 23(b)(3) class action, a putative class must demonstrate that "the questions of law or fact common to class members predominate over any questions affecting only individual members." Fed.R.Civ.P. 23(b)(3). The putative class bears the burden of demonstrating predominance. Comcast, 569 U.S. at 33-34. "If anything, Rule 23(b)(3)'s predominance criterion is even more demanding than Rule 23(a)." Comcast, 569 U.S. at 34 (citing Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623-24 (1997)). Since Rule 23(b)(3) is an "adventuresome innovation, " designed for situations in which "class-action treatment is not clearly called for, " courts have a duly to take a "close look" at whether common questions predominate over individual ones. Id. (citing Dukes, 564 U.S. at 362).

         The predominance analysis may overlap with or resemble a merits inquiry. Comcast, 569 U.S. at 33-34; Dukes, 564 U.S. at 351. "The predominance inquiry is especially dependent upon the merits of a plaintiffs claim, since the nature of the evidence that will suffice to resolve a question determines whether the question is common or individual." In re Constar Int'l Inc. Sec. Litig.,585 F.3d 774, 780 (3d Cir. 2009) (quotation marks ...


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