F ILE0 COURT OF APPEALS DIV I STATE OF WASHINGTON
2011111AR 19 AM 8:146
IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON
DAVID NAUHEIM and No. 76274-5-1 COLLEEN NAUHEIM, husband and wife and the marital community composed thereof,
Appellants, DIVISION ONE V.
VOLKSWAGEN GROUP OF AMERICA, INC., a foreign corporation, UNPUBLISHED OPINION
Respondent. FILED: March 19, 2018
SPEARMAN, J. — In class action litigation, a judgment for the plaintiff class extinguishes the claims of individual plaintiffs. David and Colleen Nauheim
(Nauheim) appeal the dismissal of their suit against Volkswagen Group of
America (VW). But Nauheim's individual claim was extinguished by the class
action settlement. We affirm.
FACTS
In the fall of 2015, VW admitted that it had installed "defeat device"
software in model 2009-2015 diesel cars. The software allowed vehicles to evade
emission-control requirements by artificially reducing emissions during testing. No. 76274-5-1/2
Nauheim owns a 2009 Volkswagen Jetta TDI (turbocharged direct
injection diesel). He filed a complaint against VW in King County Superior Court
in November 2015. Based on the defeat device software, Nauheim asserted
claims for fraud, violations of the Consumer Protection Act, Ch. 19.86 RCW and
Auto Dealers Act, Ch. 46.70 RCW and "Other Violations of State and Federal
Law." Clerk's Papers(CP)at 7.
Separately, many parties filed actions against VW in federal court. In
December 2015, a judicial panel granted a motion to establish centralized pretrial
proceedings for federal actions arising from the defeat device software. The
panel established multidistrict legislation (MDL)in the Northern District of
California and transferred pending federal cases.
In the Nauheim matter, VW asked Nauheim to specify the violations of
federal law referenced in the complaint. WV asserted that this information would
allow it to evaluate the Nauheim matter for possible removal to federal court and
transfer to the MDL. Nauheim filed an amended complaint that omitted the
reference to violations of federal law. Nevertheless, VW asserted that Nauheim's
claims depended on federal law and removed the action to federal court.1 On
March 15, 2016, the Western District court remanded to King County Superior
Court. The court ruled that Nauheim's complaint alleged only state causes of
action and the resolution of these claims did not depend on federal law. The
Nauheim matter proceeded in superior court.
In the alternative, \AN asserted that the federal court had diversity jurisdiction because the true amount in controversy was greater than $75,000. The trial court rejected this argument 'because Nauheim expressly sought less than $75,000 in actual damages. 2 No. 76274-5-1/3
The MDL litigation was also proceeding. In January 2016, the plaintiffs'
steering committee appointed a lead counsel. The lead counsel filed a consumer
class action suit on February 22. The action identified class members as persons
who owned or leased affected VW vehicles and encompassed their federal and
state law claims based on the defeat device.
In July, the MDL court granted preliminary approval of a settlement in the
class action. Under the terms of the settlement, owners of affected VW cars are
entitled to cash restitution and either a vehicle buyback or a free fix. In exchange,
class members release "any and all claims... arising from or in any way related
to" the device defeat software. CP at 484. The court certified the proposed class
and ordered that class members be given notice through a variety of media. The
court prescribed an opt-out procedure and set September 16, 2016 as the opt out
deadline.
Based on the preliminary class action settlement, VW moved to continue
the Nauheim matter. VW stated that Nauheim was a putative class member and
had until September 16 to decide whether to accept the settlement or pursue a
separate claim. VW's position was that, if Nauheim did not timely opt out, the
settlement would moot the King County case. Nauheim opposed VW's motion
and asserted that he intended to reject the proposed settlement. The court •
continued the matter until after the opt out deadline.
On October 25, the MDL court issued an order granting final approval of
the class action settlement. The order grants final certification of the settlement
class and dismisses with prejudice any individual claims by class members who
3 No. 76274-5-1/4
did not timely opt out. The order enjoins class members who did not timely opt
out from commencing or maintaining any action against VW based on the defeat
device software.
In King County, VW moved to dismiss the Nauheim action under CR 12(c)
based on the class action settlement. VW asserted that, because Nauheim did
not opt out of the settlement, he was precluded from maintaining his claim. In
response, Nauheim relied on the order of the Western District court remanding to
King County. Based on this order, Nauheim asserted that only the King County
Superior Court had jurisdiction over his claims and he was not bound by the
decision of the federal court in the class action. The trial court rejected
Nauheim's argument and granted VVV's motion to dismiss. Nauheim appeals.
DISCUSSION
We review a dismissal under CR 12(c) de novo. P.E. Systems, LLC v. CPI
corp., 176 Wn.2d 198, 203, 289 P.3d 638(2012)(citing Parilla v. King County,
138 Wn. App. 427, 431, 157 P.3d 879(2007)). Where a class action is properly
conducted, the judgment in the action binds all class members. Matsushita Elec.
Indus. Co. v. Epstein, 516 U.S. 367, 379, 116 S. Ct. 873, 134 L.Ed.2d 6(1996). A
judgment in favor of the plaintiff class extinguishes the claims of individual
plaintiffs. Cooper v. Fed. Reserve Bank of Richmond, 467 U.S. 867, 874, 104 S.
Ct. 2794, 81 L.Ed.2d 718(1984). The judgment in the class action thus has a
preclusive effect on subsequent litigation.
These principles are not altered because the judgment in the class action
is issued by a federal court. Judgments of federal courts receive the same full
4 No. 76274-5-1/5
faith and credit as judgments from other states. Williams v. Steamship Mut.
Underwriting Ass'n, 45 Wn.2d 209, 213, 273 P.2d 803(1954)(citing Hancock
Nat. Bank v. Farnum, 176 U.S. 640, 20 S. Ct. 506, 44 L. Ed. 619(1900)). See
also Stoll v. Gottlieb, 305 U.S. 165, 170, 59 S. Ct. 134, 137,83 L. Ed. 104(1938)
(state courts must accord judgments of federal courts "the same dignity... as
those of its own courts.. .").
Nauheim asserts that his individual claim was not extinguished by the
class action. He argues that, because his individual claim presents only state
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F ILE0 COURT OF APPEALS DIV I STATE OF WASHINGTON
2011111AR 19 AM 8:146
IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON
DAVID NAUHEIM and No. 76274-5-1 COLLEEN NAUHEIM, husband and wife and the marital community composed thereof,
Appellants, DIVISION ONE V.
VOLKSWAGEN GROUP OF AMERICA, INC., a foreign corporation, UNPUBLISHED OPINION
Respondent. FILED: March 19, 2018
SPEARMAN, J. — In class action litigation, a judgment for the plaintiff class extinguishes the claims of individual plaintiffs. David and Colleen Nauheim
(Nauheim) appeal the dismissal of their suit against Volkswagen Group of
America (VW). But Nauheim's individual claim was extinguished by the class
action settlement. We affirm.
FACTS
In the fall of 2015, VW admitted that it had installed "defeat device"
software in model 2009-2015 diesel cars. The software allowed vehicles to evade
emission-control requirements by artificially reducing emissions during testing. No. 76274-5-1/2
Nauheim owns a 2009 Volkswagen Jetta TDI (turbocharged direct
injection diesel). He filed a complaint against VW in King County Superior Court
in November 2015. Based on the defeat device software, Nauheim asserted
claims for fraud, violations of the Consumer Protection Act, Ch. 19.86 RCW and
Auto Dealers Act, Ch. 46.70 RCW and "Other Violations of State and Federal
Law." Clerk's Papers(CP)at 7.
Separately, many parties filed actions against VW in federal court. In
December 2015, a judicial panel granted a motion to establish centralized pretrial
proceedings for federal actions arising from the defeat device software. The
panel established multidistrict legislation (MDL)in the Northern District of
California and transferred pending federal cases.
In the Nauheim matter, VW asked Nauheim to specify the violations of
federal law referenced in the complaint. WV asserted that this information would
allow it to evaluate the Nauheim matter for possible removal to federal court and
transfer to the MDL. Nauheim filed an amended complaint that omitted the
reference to violations of federal law. Nevertheless, VW asserted that Nauheim's
claims depended on federal law and removed the action to federal court.1 On
March 15, 2016, the Western District court remanded to King County Superior
Court. The court ruled that Nauheim's complaint alleged only state causes of
action and the resolution of these claims did not depend on federal law. The
Nauheim matter proceeded in superior court.
In the alternative, \AN asserted that the federal court had diversity jurisdiction because the true amount in controversy was greater than $75,000. The trial court rejected this argument 'because Nauheim expressly sought less than $75,000 in actual damages. 2 No. 76274-5-1/3
The MDL litigation was also proceeding. In January 2016, the plaintiffs'
steering committee appointed a lead counsel. The lead counsel filed a consumer
class action suit on February 22. The action identified class members as persons
who owned or leased affected VW vehicles and encompassed their federal and
state law claims based on the defeat device.
In July, the MDL court granted preliminary approval of a settlement in the
class action. Under the terms of the settlement, owners of affected VW cars are
entitled to cash restitution and either a vehicle buyback or a free fix. In exchange,
class members release "any and all claims... arising from or in any way related
to" the device defeat software. CP at 484. The court certified the proposed class
and ordered that class members be given notice through a variety of media. The
court prescribed an opt-out procedure and set September 16, 2016 as the opt out
deadline.
Based on the preliminary class action settlement, VW moved to continue
the Nauheim matter. VW stated that Nauheim was a putative class member and
had until September 16 to decide whether to accept the settlement or pursue a
separate claim. VW's position was that, if Nauheim did not timely opt out, the
settlement would moot the King County case. Nauheim opposed VW's motion
and asserted that he intended to reject the proposed settlement. The court •
continued the matter until after the opt out deadline.
On October 25, the MDL court issued an order granting final approval of
the class action settlement. The order grants final certification of the settlement
class and dismisses with prejudice any individual claims by class members who
3 No. 76274-5-1/4
did not timely opt out. The order enjoins class members who did not timely opt
out from commencing or maintaining any action against VW based on the defeat
device software.
In King County, VW moved to dismiss the Nauheim action under CR 12(c)
based on the class action settlement. VW asserted that, because Nauheim did
not opt out of the settlement, he was precluded from maintaining his claim. In
response, Nauheim relied on the order of the Western District court remanding to
King County. Based on this order, Nauheim asserted that only the King County
Superior Court had jurisdiction over his claims and he was not bound by the
decision of the federal court in the class action. The trial court rejected
Nauheim's argument and granted VVV's motion to dismiss. Nauheim appeals.
DISCUSSION
We review a dismissal under CR 12(c) de novo. P.E. Systems, LLC v. CPI
corp., 176 Wn.2d 198, 203, 289 P.3d 638(2012)(citing Parilla v. King County,
138 Wn. App. 427, 431, 157 P.3d 879(2007)). Where a class action is properly
conducted, the judgment in the action binds all class members. Matsushita Elec.
Indus. Co. v. Epstein, 516 U.S. 367, 379, 116 S. Ct. 873, 134 L.Ed.2d 6(1996). A
judgment in favor of the plaintiff class extinguishes the claims of individual
plaintiffs. Cooper v. Fed. Reserve Bank of Richmond, 467 U.S. 867, 874, 104 S.
Ct. 2794, 81 L.Ed.2d 718(1984). The judgment in the class action thus has a
preclusive effect on subsequent litigation.
These principles are not altered because the judgment in the class action
is issued by a federal court. Judgments of federal courts receive the same full
4 No. 76274-5-1/5
faith and credit as judgments from other states. Williams v. Steamship Mut.
Underwriting Ass'n, 45 Wn.2d 209, 213, 273 P.2d 803(1954)(citing Hancock
Nat. Bank v. Farnum, 176 U.S. 640, 20 S. Ct. 506, 44 L. Ed. 619(1900)). See
also Stoll v. Gottlieb, 305 U.S. 165, 170, 59 S. Ct. 134, 137,83 L. Ed. 104(1938)
(state courts must accord judgments of federal courts "the same dignity... as
those of its own courts.. .").
Nauheim asserts that his individual claim was not extinguished by the
class action. He argues that, because his individual claim presents only state
causes of action, the federal court that decided the class action had no
jurisdiction over his claim. Nauheim contends that the lack of federal jurisdiction
was established when the Western District court remanded his claim to King
County. Nauheim further asserts that the Western District remanded because it
determined that he was not a member of the class represented in the class
action. These arguments are without merit.
In remanding to King County, the Western District court ruled that
Nauheim's individual claim did not present a federal question. This ruling
occurred before the class was certified in the class action. The district court did
not rule on whether Nauheim was a class member, whether his claims were
encompassed in the class action, or whether the federal court had jurisdiction
over the class action. The remand of Nauheim's individual suit has no bearing on
the class action.
Nauheim's individual claim is based on his ownership of a 2009
Volkswagen Jetta TDI affected by the defeat device software. The class action
5 No. 76274-5-1/6
identifies as class members all persons who owned or leased cars affected by
the defeat device software, expressly including 2009 Jetta TDIs. The class action
encompasses state law claims by persons who own affected vehicles, expressly
including claims based on Washington State law. The federal court ruled that it
had personal jurisdiction over class members and subject matter jurisdiction over
the federal and state law claims of class members. The settlement order
dismisses with prejudice claims by class members who did not timely opt out and
enjoins class members from maintaining actions arising from the defeat device
software.
Nauheim's individual claim is encompassed in the class action settlement
and was extinguished by that settlement.2 The trial court did not err in dismissing
Nauheim's suit.
Nauheim asserts, however, that the Western District's order stating that it
did not have jurisdiction became the law of the case. He also asserts, in his reply
brief, that his on-going litigation was tantamount to opt out and that the superior
court lacked authority to enforce the class action settlement. He provides no
authority to support these assertions. We decline to consider conclusory
arguments that are unsupported by citation to authority. Joy v. Dep't of Labor &
Industries, 170 Wn. App. 614,629, 285 P.3d 187(2012)(citing RAP 10.3(a)(6)).
See also Cowiche Canyon Conservancy v. Bosley, 118 Wn.2d 801, 809, 828
P.2d 549(1992)(declining to consider issue raised for the first time in reply
brief).
6 No. 76274-5-1/7
Affirmed.
WE CONCUR:
2 It appears that Nauheim may still take advantage of the settlement in the class action. At oral argument, VW asserted that, as a class member, Nauheim has until September 2018 to select a buyback or free fix. 7