Hugh Deadwyler v. Volkswagen of America, Incorporated Volkswagen Ag, Hugh Deadwyler v. Volkswagen of America, Incorporated Volkswagen Ag

884 F.2d 779
CourtCourt of Appeals for the Fourth Circuit
DecidedSeptember 28, 1989
Docket87-2688, 88-2502
StatusPublished
Cited by14 cases

This text of 884 F.2d 779 (Hugh Deadwyler v. Volkswagen of America, Incorporated Volkswagen Ag, Hugh Deadwyler v. Volkswagen of America, Incorporated Volkswagen Ag) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hugh Deadwyler v. Volkswagen of America, Incorporated Volkswagen Ag, Hugh Deadwyler v. Volkswagen of America, Incorporated Volkswagen Ag, 884 F.2d 779 (4th Cir. 1989).

Opinion

ERVIN, Chief Judge:

Plaintiffs brought this breach of implied warranty action against Volkswagen of America, Inc., and Volkswagenwerk, AG (collectively “Volkswagen”). Having failed to convince the jury of their claim that certain engine components installed in their Volkswagen Rabbits were defective, plaintiffs now appeal from the district court’s refusal to grant them a new trial. Volkswagen cross appeals from the district court’s summary refusal to consider an award of attorney’s fees for Volkswagen. For the reasons stated below, we are not persuaded by plaintiffs’ assertions of error and accordingly affirm the judgment for Volkswagen. We remand, however, with *781 instructions to the district court to hear Volkswagen’s requests for attorneys’ fees or sanctions.

I.

Plaintiffs brought this nationwide class action under the Magnuson-Moss Warranty Act of 1975, 15 U.S.C. §§ 2301-2312, alleging breach of the implied warranty of merchantability defined by UCC § 2-314(2)(c). Plaintiffs claim that Volkswagen installed defective valve stem seals in the engines of gasoline powered Volkswagen Rabbits for model years 1976 to 1979. These valve stem seals, made of polyacrylic rubber, are supposed to prevent oil from leaking into the engine’s combustion chamber. Plaintiff’s amended complaint specifically alleged that “due to the interaction of their inferior polyacrylic elas-tomer material with the relatively high heat conditions uniformly generated by the Rabbit engines, the seals tended to gradually and prematurely harden, crack, and deteriorate, typically at mileages of 20,000 to 40,000.” Plaintiffs sought to recover monetary losses due to excessive oil consumption, engine “seizures” and the diminished resale value of their Rabbits. Plaintiffs also sought recovery under various pendent state law unfair trade practice claims on the grounds that Volkswagen knew the valve stem seals were defective but concealed this knowledge from purchasers.

In February of 1987, the district court issued a Revised Class Action Order certifying, with exceptions not relevant here, three classes of plaintiffs: (1) 1976 to 1979 model Rabbit owners who incurred unreim-bursed expenses for excessive oil consumption or engine failure between 10,000 and 80,000 miles; (2) persons who purchased 1976 to 1979 model Rabbits new or second hand prior to October 1979 and who sold their vehicles within six years of the vehicle’s original retail purchase; and (3) Rabbit owners with pendent state law deceptive or unfair trade practice claims. After more than two years of discovery and motions practice, the ease went to trial on June 1,1987.

On June 18, the jury retired to consider the evidence and to make findings on the nine issues submitted by way of special verdict interrogatories. (The text of those interrogatories is attached as Appendix A.) The first interrogatory (“Issue # 1”) asked, “Were the polyacrylate valve stem seals installed by defendants in the 1976-1979 gasoline Rabbit automobiles defectively designed?” The other interrogatories were phrased such that if this first question was answered negatively the jury was not to consider the remaining issues. On June 19, the jury returned the special verdict having answered the first question negatively and judgment was subsequently entered for Volkswagen.

II.

A.

Plaintiffs vigorously challenge the form and content of the special verdict interrogatories submitted to the jury. The special verdict required the jury to find that the polyacrylic seals were defectively designed before the jurors could proceed to consider other issues. Thus, as plaintiffs recognize, an affirmative finding on Issue 1 was a necessary condition precedent to an affirmative finding on any of the remaining issues. Plaintiffs assert that this requirement was erroneous because it effectively required them to prove a specific design defect as an element of their claim that the Rabbit’s excessive oil consumption amounted to a breach of the UCC’s implied warranty of merchantability. Plaintiffs argue that a successful claimant under UCC § 2-314(2)(c) and its various and sundry state law enactments need not allege or ultimately prove a specific design defect but need only prove that the goods sold were not fit for their ordinary purpose. Plaintiffs conclude that they are entitled to a new trial because the special verdict im-permissibly imposed upon their claim an element not imposed by the UCC.

Plaintiffs also argue that the special verdict similarly misapplied the legal requirements governing their pendent state law claims. These various “Little FTC Act” *782 unfair trade practice claims were premised on the allegation that Volkswagen knew that the valve stem seals were defective, or likely to be defective, and that Volkswagen concealed this knowledge from purchasers. Plaintiffs contend that applicable state law does not require claimants to show a specific defect in order to prove that Volkswagen engaged in unfair or deceptive trade practices. Thus, plaintiffs conclude that the special verdict erroneously tied success on their unfair trade practice claims to a finding that the valve stem seals were defective.

Special verdicts are authorized by Rule 49 of the Federal Rules of Civil Procedure. As this court has previously noted, both the initial decision to use a special verdict and the formulation of issues submitted are matters “resting in the sound discretion of the trial judge.” Tights, Inc. v. Acme-McCrary Corp., 541 F.2d 1047, 1060 (4th Cir.1976), cert. denied, 429 U.S. 980, 97 S.Ct. 493, 50 L.Ed.2d 589 (1976). “It follows then, that our review of the form of the trial court’s special interrogatories is confined to whether their use in that form was an abuse of discretion.” Id. A district court abuses its discretion by, among other things, “misapprehending the law with respect to underlying issues in litigation.” Quince Orchard Valley Citizens Association, Inc. v. Hodel, 872 F.2d 75, 78 (4th Cir.1989), quoting Goldie’s Bookstore v. Super. Ct. of State of California, 739 F.2d 466, 470 (9th Cir.1984). It follows that the trial court abused its discretion if the special verdict interrogatories did indeed impose upon plaintiffs’ claims an element of proof not otherwise required by law.

We find it unnecessary, however, to reach the question of whether or not plaintiffs in a breach of implied warranty class action need prove the existence of a specific defect common to all members of the class. We also find it unnecessary to determine whether the special verdict imper-missibly tied plaintiffs’ unfair trade practice claims to the design defect issue in their breach of warranty claims.

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Bluebook (online)
884 F.2d 779, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hugh-deadwyler-v-volkswagen-of-america-incorporated-volkswagen-ag-hugh-ca4-1989.