In re Volkswagen Clean Diesel Litigation

516 S.W.3d 704, 2016 WL 8737187, 2016 Tex. LEXIS 50
CourtTexas Judicial Panel on Multidistrict Litigation
DecidedJanuary 14, 2016
DocketMDL No. 15-0884
StatusPublished

This text of 516 S.W.3d 704 (In re Volkswagen Clean Diesel Litigation) is published on Counsel Stack Legal Research, covering Texas Judicial Panel on Multidistrict Litigation primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Volkswagen Clean Diesel Litigation, 516 S.W.3d 704, 2016 WL 8737187, 2016 Tex. LEXIS 50 (Tex. Ct. App. 2016).

Opinion

MEMORANDUM OPINION

Justice Harvey Brown

delivered the unanimous opinion of the MDL panel.

Volkswagen Group of America, Inc. and Audi of America, LLC (collectively Volkswagen) ask us to create an MDL pretrial court for over 60 lawsuits pending against them in ten different counties. The lawsuits arise out of a “Notice of Violation” (also referred to as an NOV) issued by the Environmental Protection Agency, in which the EPA alleges that Volkswagen manufactured and installed “defeat devices in certain 2009 through 2015 model year diesel light-duty vehicles equipped with 2.0-liter engines which bypass, defeat, or render inoperative elements of the vehicles’ emission control system that exist to comply with [ ] emission standards” under the Texas Clean Air Act. Tex, Health & Safety Code Ann. §§ 382.001 et seq, (West 2010) (“TCAA”). The vehicles included in [706]*706the EPA NOV are certain Model Year 2009 through 2015 Volkswagen Jettas, Golfs, Beetles, Passats and Audi A3s (“the Clean Diesel Vehicles”). Plaintiffs assert that during these years Volkswagen misrepresented that the Clean Diesel Vehicles complied with U.S. emissions laws.

The lawsuits include (1) at least four “expedited discovery” lawsuits brought under Rule 169 in county courts at law by individual purchasers of Volkswagen automobiles, (2) at least two “expedited discovery” lawsuits brought in a district court, (3) individual lawsuits by consumers, (4) lawsuits (or interventions) by six counties, and (5) two lawsuits brought by the State of Texas.

The State lawsuits are a consumer protection enforcement lawsuit brought by its Consumer Protection Division (CPD) under the Deceptive Trade Practices Act1 (CPD Action) and an environmental enforcement lawsuit brought under the Tex-as Clean Air Act (TCAA Enforcement Cases).2 The TCAA Enforcement Cases are exercises of the State’s police powers to enforce provisions of the TCAA against Defendants. The TCAA Enforcement Cases seek civil penalties, attorney’s fees, and/or statutory injunctive relief under Texas law.

Volkswagen’s motion to transfer is not opposed by two counties. Nor is it opposed by the plaintiffs in twenty-six other lawsuits on behalf of over 500 consumers.3 But oppositions to the motion have been filed by various parties bringing expedited discovery lawsuits (the Expedited Plaintiffs) and is also opposed by El Paso County, which contends that it faces unique damages because of “serious environmental problems” created within the boundaries of its bordering neighbor, the City of Juarez.

While this motion was pending, and at the request of a number of plaintiffs in over 451 lawsuits pending against Volkswagen in over 60 federal courts, a federal MDL was created in a California court on December 8, 2015, concluding that the cases involved “common questions of fact” and that centralization would “serve the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation.” See In re Volkswagen “Clean Diesel” Mktg., Sales Practices, and Prods. Liab. Litig., MDL No. 2672, slip op. at 2 (J.P.M.L Dec. 8, 2015) (transfer order). Since that date, the federal government has filed a federal lawsuit seeking billions of dollars in penalties. Volkswagen also faces potential criminal charges.

Having concluded that these suits are related and that transfer would result in more efficient pre-trial of the related cases, we grant the motion to transfer these Texas cases.

FIRST PRONG: RELATEDNESS

Texas Rule of Judicial Administration 13 creates an MDL panel and authorizes it to transfer “related” cases to a [707]*707single pretrial judge if “transfer would be for the convenience of the parties and witnesses and would promote the just and efficient conduct of the cases.” Tex, R. Jud. Admin. 13.3(a)(2). Under Rule 13.3, the transfer of cases involves a threshold question: whether the cases are “related.”4 The relatedness inquiry examines whether the cases involve “one or more common questions of fact.”5

The consumer eases brought by individuals contain core questions of fact that arise out of the same device, the same conduct surrounding its purpose, design, and installation, and the same type types of vehicles. As noted by the federal court order creating a federal MDL, the numerous lawsuits against Volkswagen all

involve common factual questions regarding the role of VW and related entities in equipping certain diesel engines with software allegedly designed to engage emissions controls only when the vehicles undergo official testing, while at other times the engines emit nitrous oxide well in excess of legal limits.

In re Volkswagen “Clean Diesel” Mktg., Sales Practices, and Prods. Liab. Litig., slip op. at 2.

The Plaintiffs who oppose transfer to an MDL assert that Volkswagen’s decisions that led to it equipping its vehicles with “defeat devices” to evade federally mandated emissions standards do not present common questions of fact because they are “admitted, undisputed and indisputable.” Relying on In re Delta Lloyds Ins. Co. of Houston, 339 S.W.3d 384, 387 (Tex. M.D.L. Panel 2008), these Plaintiffs contend that, to the extent there are common questions of fact, they are insufficient because “a common origin or common event, without more, does not make cases ‘related’ under Rule 13.” In re Deepwater Horizon Incident Litig., 387 S.W.3d 127, 128 (Tex. M.D.L. Panel 2011). But the common related event that was insufficient in Delta Lloyds Insurance was an act of nature, not an act by a party. 339 S.W.3d at 387. And while there was a common event in Deep-water Horizon—the BP explosion—the eight lawsuits arising from that explosion involved different types of damage claims, involving “different allegations arising from different events on different dates” and not involving liability for the explosion itself. In re Deepwater Horizon Incident Litig., 387 S.W.3d at 128.6 Finally, belying their claim that the common liability facts are undisputed, the parties opposing the transfer have not offered to forgo discovery on Volkswagen’s conduct. This discovery likely will be extensive, delving into the entities and individuals involved in these decisions, their motives, and Volkswagen’s business practices.7

The State has its own separate grounds for opposing the transfer. First, it contends that “the TCAA Enforcement Cases fail the relatedness test when compared with the private consumer damage cases.” Second, it argues that its CDP Action differs from individual consumer’s claims even though all allege DTPA violations. According to the State, the DTPA provisions that allow it to prosecute a claim on [708]

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Cite This Page — Counsel Stack

Bluebook (online)
516 S.W.3d 704, 2016 WL 8737187, 2016 Tex. LEXIS 50, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-volkswagen-clean-diesel-litigation-texjpml-2016.