Corder v. Ford Motor Company
Filing
248
MEMORANDUM OPINION by Senior Judge Charles R. Simpson, III on 1/16/2014; For reasons set forth, Corders third motion for class certification (DN 242) is DENIED. A separate order will be entered in accordance with this memorandum opinion.cc:counsel (DAK)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
AT LOUISVILLE
KENNETH E. CORDER, SR., on Behalf
of Himself and All Others Similarly Situated
PLAINTIFFS
v.
NO. 3:05-CV-00016-CRS-JDM
FORD MOTOR COMPANY
DEFENDANT
MEMORANDUM OPINION
This matter is before the court on the plaintiff’s third motion for class certification. (DN
242). The matter is now ripe for adjudication. For the reasons set forth below, the plaintiff’s third
motion for class certification (DN 242) will be denied.
I.
The relevant facts and procedural history set forth below are taken from the court’s prior
memorandum opinions addressing plaintiff Kenneth E. Corder’s (“Corder”) first and second
motions for class certification.1
A. Corder’s Allegations and Ford’s Responses
Corder filed this action against defendant Ford Motor Company (“Ford”) on behalf of
himself and others in 2004. Corder alleges that the 6.0L Power Stroke diesel engines installed by
Ford in model year 2003 F–Series Super Duty Trucks and Excursions were highly problematic.
Corder claims that those engines, which he deems the “2003 engines,” were “renowned for a
host of serious problems,” leading Ford to implement a customer service program for those
vehicles and even to recall and buy back some vehicles installed with those engines. (Second
Am. Compl., DN 215, ¶ 14). Corder alleges that many consumers waited until the 2004 model
1
See DNs 210, 238.
year to purchase F–Series Super Duty Trucks or Excursions, believing that Ford would make
improvements to the “2003 engines.” (Id.). However, Corder claims, Ford continued to install
“2003 engines” in model year 2004 Super Duty Trucks and Excursions that were assembled in
July, August, and September of 2003. (Id. at ¶ 15). Then, in October 2003, Ford “orchestrated a
coordinated change” with its engine manufacturer “to implement changes and improvements” in
the 6.0L Power Stroke diesel engine for the remainder of the 2004 model year. (Id. at ¶ 16).
In May 2004, Corder purchased a model year 2004 Ford F–250 Super Duty Truck with a
6.0L Power Stroke diesel engine. (Id. at ¶ 19). Shortly thereafter, Corder claims, he found out
that the engine in his truck was a “2003 engine” that did not have the improvements that were in
the “2004 engine.” (Id. at ¶ 20). According to Corder, Ford’s non-disclosure that it had installed
a “2003 engine” in his model year 2004 truck was an unfair, false, misleading, or deceptive act
within the meaning of the Kentucky Consumer Protection Act, KRS § 367.110 et seq.
(“KCPA”), and it caused him to suffer an ascertainable loss. (Id. at ¶¶ 21, 32).
Ford, for its part, takes issue with Corder’s claim that its engines have model years. Ford
claims, in effect, that it makes running changes to its engines throughout the year. (See DN 228,
p. 5–10). Thus, Ford argues that the purchasers of 2004 model year trucks built prior to October
2003 received multiple different engines, and “all of those engines were improved over most
engines installed on most 2003 vehicles.” (Id. at 1–2, 6). Ford further claims that “in the months
and days before and after October 1, 2003,” it was making “constant quality improvements” to
the engines. (Id. at 2, 5–7, 9–10). Ford takes the position that October 1, 2003 was simply a date
on which it made additional changes to the engines that brought them up to 2004 emissions
standards. (Id. at 2, 8).
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B. Procedural History
Following initial discovery, Ford moved for summary judgment. This court granted the
motion, finding that Corder had not shown that Ford’s actions were false, misleading, or
deceptive within the meaning of the KCPA, nor had Corder shown that he suffered an
“ascertainable loss,” as is required to maintain a private action under the KCPA. The Sixth
Circuit disagreed with this court’s disposition, holding that a reasonable jury could find that
Ford’s actions were deceptive and that Corder suffered an ascertainable loss when he received an
engine that was not the same as the one a reasonable consumer would have expected. See Corder
v. Ford Motor Co., 285 F. App’x. 226 (6th Cir. 2008).
Upon remand to this court, Corder filed a motion to certify a national class. (DN 194).
However, this court denied Corder’s motion, finding that a national class was not viable because
the laws of each of the states in which the putative class members purchased their vehicles would
have to be applied, which would lead to significant problems of individualized proof and
manageability. (DN 210). This court identified state laws that required proof of reliance as
posing particular problems, since the element of reliance would require an individualized inquiry
into the state of mind of each consumer.
This court then granted Corder leave to file a second amended complaint, in which he
sought to represent a class of only Kentucky residents. (DNs 214, 215). The second amended
complaint stated that there were at least 586 members of the class, whose identities and addresses
can be readily ascertained from Ford’s records. (DN 215, ¶ 23).
Ford moved to dismiss Corder’s second amended complaint. (DN 220). Ford contended
that the KCPA required proof of reliance, but Corder did not plead in the second amended
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complaint that he had relied on Ford’s deceptive act. This court denied Ford’s motion to dismiss,
finding that the KCPA did not require proof of reliance. (DN 236).
Corder then filed a second motion for class certification in which he sought to certify a
class pursuant to Federal Rule of Civil Procedure 23(b)(3). (DN 218). Corder’s second proposed
class included
All Kentucky residents who were original purchasers of a 2004 model year
Ford F–Series Super Duty Truck or Excursion, which Ford Motor Company
manufactured and installed with 6.0L “Power Stroke” diesel engines before
October 1, 2003. To be excluded from the Class are the judges to whom this
case is assigned and their staff.
(Id. at 1). This court denied Corder’s motion, finding that Corder failed to meet the requirements
for class certification set forth in Rule 23(b)(3). (DN 238). In particular, we held that Corder
could not demonstrate that common issues would predominate over the individual issues present
in the case because
[T]o establish liability under the KCPA, it also must be shown that the good at
issue was purchased primarily for personal, family, or household purposes.
In this case, the need to determine the primary purpose for each customer’s
purchase requires an individualized inquiry that threatens to overwhelm any
trial on the matter. The trucks at issue—Ford F–Series Super Duty Trucks and
Excursions that have been installed with 6.0L Power Stroke diesel engines—
are not the type of product about which it may be inferred that all, or even the
vast majority, were purchased primarily for a personal, family, or household
purpose.
....
Not only does it appear likely that many members of Corder’s proposed class
purchased their trucks primarily for commercial purposes, but the litigation of
that issue will require individualized inquiries into numerous class members.
Clearly, the question of why any particular customer purchased the pickup
truck is not something that can be resolved on a class-wide basis. Thus, the
question is whether such an individualized inquiry destroys the predominance
of class-wide issues. In this instance, the court finds it does.
(Id. at 7, 9).
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Corder then filed this third motion for class certification, in which he redefined the
proposed class to include
All Kentucky residents who were original purchasers of a 2004 model year
Ford F–Series Super Duty Truck or Excursion, which Ford Motor Company
manufactured and installed with 6.0L “Power Stroke” diesel engines before
October 1, 2003, and who purchased their vehicles primarily for personal,
family or household purposes.
To be excluded from the Class are individuals whose 2004 model year Ford F–
Series Super Duty Truck or Excursion vehicles were registered as commercial
vehicles pursuant to KRS 186.050 (2004). Also to be excluded from the Class
are the judges to whom this case is assigned and their staff.
(DN 242, p. 1).
II.
The party seeking certification of a class action bears the burden of showing that a class
action is appropriate. In re Am. Med. Sys., Inc., 75 F.3d 1069, 1079 (6th Cir. 1996). A district
court considering a motion for class certification must conduct a “rigorous analysis” into whether
the requirements of Rule 23 of the Federal Rules of Civil Procedure are met. Gen. Tel. Co. of Sw.
v. Falcon, 457 U.S. 147, 161 (1982). In doing so, it may be necessary for the court to “probe
behind the pleadings.” Wal–Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551 (2011) (quoting
Gen. Tel. Co. of Sw., 457 U.S. at 160). A district court has “broad discretion in determining
whether a particular case may proceed as a class action” so long as the court applies Rule 23’s
criteria correctly. Cross v. Nat’l Trust Life Ins. Co., 553 F.2d 1026, 1029 (6th Cir. 1977).
In order for a class action to be certified, it must meet the prerequisites of Rule 23(a) of
the Federal Rules of Civil Procedure: (1) the class must be so numerous that joinder of all
members is impracticable; (2) there must be questions of law or fact that are common to the
class; (3) the claims or defenses of the representative parties must be typical of the class; and (4)
the representative parties must fairly and adequately protect the interests of the class. In addition
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to meeting those prerequisites, a class action must fall within one of the categories set forth in
Rule 23(b).
A class action may proceed pursuant to Rule 23(b)(3) if “the court finds that the
questions of law or fact common to class members predominate over any questions affecting
only individual members, and that a class action is superior to other available methods for fairly
and efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). In order to meet the
demand of Rule 23(b)(3) that common issues predominate, a plaintiff must show that “the issues
in the class action that are subject to generalized proof, and thus applicable to the class as a
whole, . . . predominate over those issues that are subject only to individualized proof.” Beattie v.
CenturyTel, Inc., 511 F.3d 554, 564 (6th Cir. 2007) (quoting In re Visa Check/MasterMoney
Antitrust Litig., 280 F.3d 124, 136 (2d Cir. 2001)). The predominance requirement in Rule
23(b)(3) “guards against certifying class actions that could overwhelm or confuse a jury or
compromise a party’s defense . . . .” 59 Am. Jur. 2d, Parties § 74 (2013). “[C]ertification is not
appropriate unless it is determinable from the outset that the individual issues can be considered
in a manageable, time-efficient, and fair manner.” Id. (footnote omitted). The predominance
requirement “is one of the most stringent prerequisites to class certification.” Id. (footnote
omitted).
III.
In this action, Corder seeks class certification pursuant to Rule 23(b)(3), which requires
the court to find that the questions of law or fact that are common to the class members
predominate over any questions affecting only individual members, and that a class action is
superior to other available methods for fairly and efficiently adjudicating the controversy. This
court previously held that the questions of law and fact that were common to the class members
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did not predominate over the issues that were subject to individualized proof. (DN 238). Corder
then filed the present motion, in which he revised the class definition in the hopes of comporting
with the provisions of Rule 23(b)(3). The court finds that Corder still has not met his burden of
showing that the requirements of Rule 23(b)(3) are met. Thus, we need not address whether
Corder’s proposed class definition satisfies the requirements of Rule 23(a).2
Corder seeks relief on behalf of himself and the proposed class under the provisions of
the KCPA. KRS § 367.220, which provides for the recovery of damages under the KCPA, states
in pertinent part that
Any person who purchases or leases goods or services primarily for personal,
family or household purposes and thereby suffers any ascertainable loss of
money or property, real or personal, as a result of the use or employment by
another person of a method, act or practice declared unlawful by KRS 367.170,
may bring an action . . . to recover actual damages.
Further, KRS § 367.170 declares “[u]nfair, false, misleading, or deceptive acts or practices in the
conduct of any trade or commerce” to be unlawful. Thus, for Ford to be liable for damages to a
person under the KCPA, it must be established that: (1) the person purchased or leased a Ford
vehicle in question primarily for personal, family, or household purposes; (2) the person suffered
an ascertainable loss; and (3) the loss was a result of an unfair, false, misleading, or deceptive act
or practice.
In the memorandum opinion denying Corder’s second motion for class certification, this
court determined that before Ford could be deemed liable to any prospective class member under
the KCPA, it must be established that the person’s primary reason for purchasing the truck was
for a personal, family, or household use. (DN 238, p. 14). We noted that this would require an
individualized inquiry into each prospective class member’s primary purpose for purchasing the
2
Accordingly, the court need not address Ford’s concerns regarding Corder’s ability to satisfy the Rule 23(a)
requirements, as set forth in Ford’s Response Memorandum in Opposition to Plaintiff’s Renewed Motion for Class
Certification. (DN 246).
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truck. Corder estimated that the class would contain approximately 600 persons, and this court
found that “having to undertake an individualized inquiry into the state of mind of even onequarter of them simply to establish Ford’s liability will overwhelm any trial in this matter.” (Id.
at 11). Thus, we denied Corder’s second motion to certify.
Corder’s third motion for class certification attempts to address the concerns posed in the
court’s prior order by altering the class definition to specifically exclude “individuals whose
2004 model year Ford F–Series Super Duty Truck or Excursion vehicles were registered as
commercial vehicles pursuant to KRS 186.050 (2004).” (DN 242, p. 1). KRS § 186.050 lists the
registration fees for certain classes of vehicles in Kentucky. Subsection (1) of the registration
statute outlines the registration fee “for motor vehicles, including taxicabs, airport limousines,
and U-Drive-Its, primarily designed for carrying passengers and having provisions for not more
than nine (9) passengers, including the operator, and pickup trucks and passenger vans which are
not being used on a for-hire basis,” while subsection (2) provides for the registration fee for
motorcycles. KRS § 186.050(1), (2). Subsection (3) declares that “[a]ll motor vehicles except
those mentioned in subsections (1) and (2) of this section, and those engaged in hauling
passengers for hire, operating under certificates of convenience and necessity, are classified as
commercial vehicles[.]” KRS § 186.050(3)(b).
The types of vehicles at issue in this action are F–Series Super Duty Trucks, which would
be considered “pickup trucks” under the registration statute, and F–Series Super Duty
Excursions, which would be classified as motor vehicles primarily designed for carrying
passengers and having provisions for not more than nine passengers. Thus, the vehicles at issue
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in this action cannot be considered “commercial vehicles” under the statute because they fall
within the definition provided in Subsection (1).3
According to Corder, the revised class definition creates a class in which all “proposed
[members] are, by definition, non-commercial purchasers.” (DN 242, p. 4). Thus, Corder claims,
the court need only engage in a ministerial review of registration records to determine which of
the trucks were purchased for non-commercial purposes. However, the fact that a vehicle was or
was not registered as a commercial vehicle under the provisions of KRS § 186.050 does not
answer the inquiry required by the KCPA. To bring an action under the KCPA, a consumer must
show that he or she purchased or leased goods “primarily for personal, family or household
purposes . . . .” KRS § 367.220. The KCPA thus addresses the consumer’s reason, or primary
purpose, for acquiring the good. The registration statute, however, does not consider the reason,
or primary purpose, for the consumer’s acquisition of the vehicle. Rather, it addresses the
physical attributes of the vehicle and, in one instance, the actual use of the vehicle as a for-hire
vehicle.
Corder’s proposed class definition would rely on the registration statute to distinguish
between commercial and non-commercial vehicles on the basis of their physical characteristics
or their use as a for-hire vehicle. This class definition fails to satisfy the requirements of the
KCPA because it does not address the consumer’s primary purpose for purchasing or leasing the
vehicle. As such, the court would still need to undertake an individualized inquiry into the
customers’ primary initial intended use for the vehicle at the time acquisition. Therefore,
Corder’s proposed class definition does not resolve the court’s concerns that many of these
3
The court notes that some of the F–Series Super Duty Trucks may fall under Subsection (3), and therefore be
classified as commercial vehicles, if they are registered as pickup trucks used on a for-hire basis.
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individualized inquiries would require jurors to resolve competing arguments based on detailed
facts, thereby overwhelming the trial of the common issues.
Corder argues that “[o]ther courts have found that a determination for each class member
as to whether their transaction was made for personal, family or household purposes does not
predominate over common issues regarding whether a defendant’s conduct violates the law.”
(DN 242, p. 23–24). Corder cites to two cases in which putative classes brought claims against
commercial entities under the Fair Debt Collection Practices Act (“FDCPA”), which applies to
the obligation of a consumer to pay money arising from a transaction for personal, family, or
household purposes. See Butto v. Collecto Inc., 290 F.R.D. 372 (E.D.N.Y. 2013); Gradisher v.
Check Enforcement Unit, Inc., 203 F.R.D. 271 (W.D. Mich. 2001). In Gradisher, a Michigan
district court concluded that it could determine whether each proposed class member wrote a
check for personal or business purposes, and thus satisfy the prerequisites for a claim under the
FDCPA, by looking at the check itself (i.e., whether it was a personal check), examining the
defendant’s computer system, or asking “one simple question to each class member.” Gradisher,
203 F.R.D. at 279. Corder contends that, as in Gradisher, this court can similarly discern a
potential class member’s primary purpose by engaging in a ministerial review of registration
records and insurance policy declarations, or by asking the potential class member “one simple
question.”4 (DN 242, p. 24).
The individualized inquiry involved in the FDCPA cases cited above is distinguishable
from the inquiry required for claims brought under the KCPA. Notably, the KCPA restricts
claims to those purchasers whose primary purpose was for a personal, family, or household use,
4
Ford argues that Corder is proposing that the court engage in a “truncated evidentiary hearing [which] would
violate both the Rules Enabling Act and the Due Process Clause of the United States Constitution because Ford
would be deprived of its right to put on evidence negating an element of a claim.” (DN 246, p. 7). Because the court
declines to adopt Corder’s proposed method of ministerial review, we need not address these concerns raised by
Ford.
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but it does not require that the customer’s sole purpose was for a personal, family, or household
use. (DN 238, p. 10). Accordingly, distinguishing between the customers who registered their
trucks as commercial vehicles under KRS § 186.050 and those customers who did not register
their trucks as commercial vehicles would not, as Corder claims, resolve the preliminary inquiry
required by the KCPA. The court would still need to determine whether the customers who did
not register their trucks as commercial vehicles under KRS § 186.050 had the primary purpose,
at the time of purchase, to use their trucks for personal, family, or household purposes. And
because the KCPA explicitly requires that a person have purchased a product primarily for
personal, family, or household use prior to a finding of liability, Ford is entitled to demand a full
litigation of that element for each potential class member. See Wal-Mart Stores, Inc. v. Dukes,
131 S. Ct. 2541, 2561 (2011). Further, other courts have declined to certify class actions in
situations similar to the one before the court, in which there was a concern regarding proof of a
certain element of the action. See In re OnStar Contract Litig., 278 F.R.D. 352, 379–381 (E.D.
Mich. 2011); Arabian v. Sony Elecs., Inc., 2007 WL 627977, *14 (S.D. Cal. Feb. 22, 2007);
Rockey v. Courtesy Motors, Inc., 199 F.R.D. 578, 593 (W.D. Mich. 2001); Carpenter v. BMW of
N. Am., Inc., 1999 WL 415390, *3 n. 6 (E.D. Pa. June 21, 1999).
Therefore, Corder’s third proposed class definition does not rectify the problems this
court identified in our prior order denying class certification. Accordingly, we find that Corder
has not met his burden of showing that class certification is appropriate under Federal Rule of
Civil Procedure 23(b)(3).
IV.
For the reasons set forth herein this date and the court being otherwise sufficiently
advised, IT IS HEREBY ORDERED that Corder’s third motion for class certification (DN
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242) is DENIED. A separate order will be entered this date in accordance with this
memorandum opinion.
IT IS SO ORDERED.
January 16, 2014
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