John F. "Jack" Walsh v. Ford Motor Company

807 F.2d 1000, 257 U.S. App. D.C. 85, 6 Fed. R. Serv. 3d 536, 1986 U.S. App. LEXIS 34986
CourtCourt of Appeals for the D.C. Circuit
DecidedDecember 19, 1986
Docket85-5879
StatusPublished
Cited by242 cases

This text of 807 F.2d 1000 (John F. "Jack" Walsh v. Ford Motor Company) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
John F. "Jack" Walsh v. Ford Motor Company, 807 F.2d 1000, 257 U.S. App. D.C. 85, 6 Fed. R. Serv. 3d 536, 1986 U.S. App. LEXIS 34986 (D.C. Cir. 1986).

Opinion

GINSBURG, Circuit Judge.

HARRY T. EDWARDS, Circuit Judge

and RUTH B. GINSBURG, Circuit Judge:

Plaintiffs-Appellees, who proposed to represent several million owners of Ford automobiles, initiated the instant suit against Ford Motor Company to pursue breach of warranty claims by means of class actions. The appellees’ suit arises under the Magnuson-Moss Warranty-Federal Trade Commission Improvement Act (“Magnuson-Moss” or the “Act”); 1 the essence of appellees’ complaint is that certain Ford models suffer from a transmission defect that causes the automobiles to slip out of the “park” position and into “reverse.”

In order to obtain class action certification under Rule 23 of the Federal Rules of Civil Procedure, appellees grouped their breach of warranty claimants into three principal categories: one group (“written warranty incidents” class) included all Ford owners who had allegedly experienced a “park-to-reverse” incident within Ford’s 12,000 mile/12 month written warranty period; the second group (“implied warranty incidents” class) included every Ford owner who allegedly experienced a park-to-reverse incident; and the third group (“all-owners” class) included all owners of an allegedly defective Ford vehicle, without regard to whether the owner had ever experienced a park-to-reverse incident. Citing a variety of legal objections, Ford opposed class certification; in particular, Ford argued that none of the appellees’ proposed claimant groups was a cognizable “class” under Rule 23.

Although the District Court recognized that appellees’ proposed class groupings raised some difficult legal issues under Rule 23, the trial judge nevertheless conditionally certified all three classes. The District Court decided to apply Rule 23 only where it is consistent with the terms and intent of Magnuson-Moss; therefore, having found that Magnuson-Moss reflects a congressional intent liberally to allow class actions as a device to facilitate consumers’ recovery for breach of warranties, the District Court concluded that appellees’ proposed classes should be certified as suggested. The effect of this ruling was to allow appellees to avoid the strict requirements of class certification under Rule 23.

Given the importance of the legal questions at issue, and the enormity of the litigation presently contemplated, the District Court approved appellant’s request for interlocutory review under 28 U.S.C. *1002 § 1292(b). On November 7, 1985, this court granted interlocutory appeal on the issue of class certification. 2

Because we find that the District Court’s decision to certify appellees’ classes was based in significant part on an improper construction of Magnuson-Moss, rather than on a normal application of Rule 23, we vacate and remand for further consideration as to whether any class certification is appropriate under unmodified Rule 23 standards.

I. BACKGROUND

A. Factual Background

The plaintiffs-appellees brought this action under section 110 of Magnuson-Moss, 3 alleging that the defendant-appellant, Ford Motor Company, breached both its implied and written warranties of merchantability by marketing defectively designed automobiles. In particular, the appellees alleged that 1976-79 (and 1980 pre-design change) Ford vehicles equipped with FMX, C-3, C-4 and C-6 automatic transmissions suffer from a defect that causes the automobiles to slip out of the “park” position and into “reverse.” 4 The appellees, claiming to represent several million Ford owners, sought to pursue their breach of warranty claims by means of class actions. For the purpose of obtaining class action certification, they grouped their principal claims into three broad categories. The first group (“written warranty incidents” class) consisted of all Ford owners who allegedly experienced a park-to-reverse incident within Ford’s 12,000 mile/12 month written warranty period. This group sought certification under Rule 23(b)(3) to recover property damages incurred in these incidents. 5 The second group (“implied warranty incidents” class) consisted of all Ford owners who allegedly experienced a park-to-reverse incident. This group also sought certification under Rule 23(b)(3) to recover property damages. The third group (“all-owners” class) consisted of all owners of *1003 an allegedly defective Ford vehicle, without regard to whether the owner had experienced an actual park-to-reverse incident. 6 This group sought certification under Rule 23(b)(3) to recover damages equal to the difference in value between the transmissions as received and as warranted; or, in the alternative, certification under Rule 23(b)(2) to compel Ford to repair the defective vehicles. 7 The appellees also asked the District Court to certify two additional “incidents” classes, one to recover punitive damages and the other to pursue personal injury claims.

Before the District Court, Ford opposed class certification on numerous grounds. 8 Under Rule 23(b)(3), Ford observed, a district court may not certify a class unless it finds that “questions of law or fact common to the members of the [proposed] class predominate over any question affecting only individual members.” With respect to the implied warranty classes, Ford argued, it could not be found that common questions of law predominated, because Magnu-son-Moss defines implied warranties as those arising under state law, 9 and there are material variations in state laws governing the interpretation of implied warranties. 10 With respect to all the proposed classes, Ford argued, it could not be found that common questions of fact predominated, because the appellees had not proffered any proof that the four different transmissions (the FMX, C-3, C-4 and C-6) suffered from a common defect. 11 With respect to the “incidents” classes, Ford argued, it again could not be found that common questions of fact predominated, because each plaintiff would be required to make an individual showing that her accident was caused by Ford’s allegedly defective design.

Ford also argued that certification of an “all-owners” class was improper in light of the appellees’ concession that they could not bear the cost of providing individual notice of the action to the several million absentee class members. As interpreted in Eisen v. Carlisle & Jacquelin,

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Bluebook (online)
807 F.2d 1000, 257 U.S. App. D.C. 85, 6 Fed. R. Serv. 3d 536, 1986 U.S. App. LEXIS 34986, Counsel Stack Legal Research, https://law.counselstack.com/opinion/john-f-jack-walsh-v-ford-motor-company-cadc-1986.