Denny v. Ford Motor Co.

959 F. Supp. 2d 262, 2013 WL 4068500, 2013 U.S. Dist. LEXIS 116117
CourtDistrict Court, N.D. New York
DecidedAugust 13, 2013
DocketNo. 3:11-CV-1239
StatusPublished
Cited by4 cases

This text of 959 F. Supp. 2d 262 (Denny v. Ford Motor Co.) is published on Counsel Stack Legal Research, covering District Court, N.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Denny v. Ford Motor Co., 959 F. Supp. 2d 262, 2013 WL 4068500, 2013 U.S. Dist. LEXIS 116117 (N.D.N.Y. 2013).

Opinion

MEMORANDUM-DECISION and ORDER

DAVID N. HURD, District Judge.

TABLE OF CONTENTS

INTRODUCTION...............................................................266

FACTUAL BACKGROUND......................................................266

STANDARD OF REVIEW.......................................................267

DISCUSSION..................................................................267

Fraud on the Court — Third Cause of Action...................................267

Res Judicata...............................................................268

Collateral Estoppel.........................................................270

Statute of Limitations.......................................................272

Fraud — First Cause of Action..........................................272

Fraudulent Non-Disclosure of a Material Fact — Fourth Cause of Action.....273

Civil Conspiracy — Fifth Cause of Action.................................273

Violations of RICO — Seventh Cause of Action ............................273

Conspiracy to Violate RICO — Eighth Cause of Action .....................274

Punitive Damages — Ninth Cause of Action ...................... 275

CONCLUSION.................................................................275.

[266]*266I. INTRODUCTION

On October 17, 2011, plaintiffs Nancy and Robert Denny (“the Dennys” or “plaintiffs”) filed this action against Ford Motor Company (“Ford” or “defendant”), asserting causes of action sounding in fraud and violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”). An amended complaint was filed on February 28, 2012. Defendant filed a motion to dismiss pursuant to Federal Rule of Civil Procedure (“Rule-”) 12(b)(6) for failure to state a claim. Plaintiffs opposed, and defendant replied. Oral argument was heard in Utica, New York. Decision was reserved.

II. FACTUAL BACKGROUND

On June 9, 1986, Nancy Denny was injured when she swerved to avoid hitting a deer on the road. The Ford Bronco II (“Bronco II”) she was driving rolled over. In 1988, the Dennys brought a products liability action (“Denny I”) against Ford in the Northern District of New York. The complaint alleged negligence, strict products liability, and breach of implied warranty. The central issue of the case, and similar litigation all over the country, was whether the Bronco II was defective in design due to its propensity to roll over. On November 17, 1992, after a three week jury trial before District Judge Thomas J. McAvoy in Binghamton, New York, the jury found for plaintiffs on the breach of implied warranty claim, and in favor of Ford on the strict products liability and negligence claims. The jury awarded plaintiffs $3 million in compensatory damages, but found Nancy Denny sixty percent at fault for her injuries, due to her maneuver to avoid the deer. Thus, her award was reduced to $1.2 million. Judgment was entered consistent with the verdict, and that judgment was ultimately affirmed by the Second Circuit Court of Appeals on March 19, 1996. Denny v. Ford Motor Co., 79 F.3d 12, 13 (2d Cir.1996). Ford subsequently satisfied the judgment.

Plaintiffs now bring suit (“Denny II”) against Ford, arguing that but for Ford’s fraud and conspiracy during the pre-trial and trial phases of Denny I, plaintiffs would have recovered more damages because the jury would not have found Nancy Denny comparatively negligent and would have awarded punitive damages. Specifically, plaintiffs allege the following fraudulent and unlawful conduct: (1) Ford knowingly purchased and used the false and misleading testimony of former Ford engineer David J. Bickerstaff (“Bicker-staff’) during its defense of Denny I (and concealed this from the court and plaintiffs); (2) Ford fraudulently concealed, destroyed, and misrepresented to the court and plaintiffs the existence of critical documents that provided evidence that was favorable to plaintiffs’ case and evidence that Ford knew, or should have known, would harm their defense; (3) Ford surreptitiously collected and destroyed critical documents and misrepresented the legitimacy of that collection and destruction process to the court; and (4) Ford concealed the fact that they knew the Bronco II was unsafe before they allowed it to be sold to the American public.

Plaintiffs allege that their counsel recently discovered Ford’s unlawful conduct in the process of due diligence for the preparation of a new Bronco II case. They point to five pieces of evidence which they allege Ford, its attorneys, and Biekerstaff hid during Denny I: (1) a letter from Bickerstaff to Ford detailing his retention rate of $5,000 per day to “assist you [Ford] in preparing myself, in Ford’s favor,” which the Dennys contend shows Bickerstaff was paid to give misleading testimony, Pls.’ Am. Compl., Ex. A, ECF No. 15-1 (“Bickerstaff Letter”); (2) a vehi[267]*267cle design and testing memo from one of Ford’s departments to the Arizona Proving Ground (where Ford attempted to test drive the Bronco II) prepared for release of the Ford Explorer, which plaintiffs contend acknowledges the Bronco II’s problems with jacking, stability, and design, and could have been used to attack Ford’s defense and support plaintiffs’ expert’s testimony (“Vehicle Design and Testing Memo”); (3) Ford’s surreptitious method of collecting Bronco II-related documents, many of which were destroyed, which was unprecedented by the company; (4) Ford’s own statistics showing that the Bronco II was experiencing jacking at ten times the rate of the Chevrolet Blazer; and (5) that the Bronco II ceased to be tested on the track by professional drivers, not because Ford developed a computer program which eliminated the need to do so — as they argued in Denny I — but because the vehicles were unsafe even for professional drivers.

In the amended complaint, the Dennys allege nine causes of action: fraud (First Cause of Action); intentional non-disclosure of a material fact (Second Cause of Action); fraud on the court (Third Cause of Action); fraudulent non-disclosure of a material fact (Fourth Cause of Action); civil conspiracy (Fifth Cause of Action); spoliation of evidence (Sixth Cause of Action); violations of RICO (Seventh Cause of Action); conspiracy to violate RICO (Eighth Cause of Action); and punitive damages (Ninth Cause of Action). In their opposition to Ford’s motion, plaintiffs withdrew their claims of intentional nondisclosure of a material fact (Second Cause of Action) and spoliation of evidence (Sixth Cause of Action). Pls.’ Mem. Opp’n Summ. J. 18, 23 (“Pls.’ Mem.”).

III. STANDARD OF REVIEW

“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 663, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly,

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Cite This Page — Counsel Stack

Bluebook (online)
959 F. Supp. 2d 262, 2013 WL 4068500, 2013 U.S. Dist. LEXIS 116117, Counsel Stack Legal Research, https://law.counselstack.com/opinion/denny-v-ford-motor-co-nynd-2013.