Nelson v. Forest River, INC et al
Filing
98
ORDER denying 82 Forest River's Motion to Dismiss. Signed by Judge Brian Morris on 10/23/2024. (TLO)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
GREAT FALLS DIVISION
JAY NELSON, individually and on
behalf of all others similarly situated,
CV-22-49-GF-BMM
Plaintiff,
ORDER
v.
FOREST RIVER, INC.,
Defendant.
INTRODUCTION
Plaintiff Jay Nelson (“Nelson”) has filed a class action suit against Forest
River, Inc. (“Forest River”).
(Doc. 1.)
Nelson alleges that Forest River
manufactures Subject RVs with a wiring system that violates industry safety
standards in several ways (the “Defect”). (Doc. 45 at ¶ 5.) Nelson alleges that the
Defect caused Nelson’s 2019 Puma RV to catch fire, that he had to repair the same
Defect in the 2020 Puma RV he purchased, and that the Defect creates a safety
hazard and misleads consumers of Subject RVs. (Doc. 45 at ¶¶ 5–10, 66.)
Nelson filed his first Complaint in this Court on May 23, 2022. (Doc. 1.)
Nelson has amended his Complaint three times. (Doc. 38); (Doc. 39); (Doc. 45.)
Forest River has filed corresponding Motions to Dismiss. (Doc. 26); (Doc. 40); (Doc.
49.) The Court granted Forest River’s motion to dismiss Nelson’s Consumer
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Product Safety Act, fraudulent concealment, and declaratory relief claims. (Doc.
67.)
Nelson’s class allegations and claims for negligence, negligent
misrepresentation, and violations of the Montana Consumer Protection Act remain.
(Id.)
Forest River inspected the 7-way electrical cord in the 2020 Puma RV in April
2024. (Doc. 83 at 6.) Forest River found that the charge line between the trailer
battery and the junction box connected to the wrong side of a breaker. (Doc. 83 at
6–7.) The incorrectly wired charge line lacked overcurrent protection that could
cause the wire to overheat and catch fire. (Doc. 83 at 7.) Forest River initiated a
recall of affected vehicles to fix the wiring problem (the “Recall”). (Doc. 83 at 6–
7.)
Forest River now moves to dismiss Nelson’s Third Amended Complaint on
prudential mootness grounds under Federal Rule of Civil Procedure 12(b)(1). (Doc.
82.) Forest River argues that the Recall supervised by the National Highway Traffic
Safety Administration (“NHTSA”) provides Nelson and putative class members
with all their requested relief and renders Nelson’s claims prudentially moot. (Doc.
83 at 3.) Nelson argues that the NHTSA recall fails to cure the Defect and does not
compensate Nelson fully for his injuries. (Doc. 90 at 7.)
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BACKGROUND
Nelson alleges that as a condition of its membership in the Recreational
Vehicle Industry Association (“RVIA”), Forest River adopted RVIA’s safety
standards that include those of the National Fire Protection Association (“NFPA”)
and the American National Standards Institute (“ANSI”). (Doc. 45 at ¶¶ 31–39.)
The NFPA requires RV equipment to exhibit mechanical strength, durability, and
electrical insulation in order to withstand heating effects under normal and abnormal
conditions, arcing effects, and other factors affecting safety. (Doc. 45 at ¶ 41.) The
ANSI requires RV wiring to be routed away from sharp edges, moving parts, and
heat sources, and to have conductors with overcurrent protection, support and
protection against physical damage, and additional material where insulated
conductors are clamped to the structure. ANSI further requires fuses and circuit
breakers to have protection against the weather and physical damage. (Doc. 45 at ¶
42.)
Nelson alleges that the Defect violates these safety standards, misleads
consumers, and creates a fire hazard. (Doc. 45 at ¶¶ 43, 46.)
In April 2019, Nelson bought a new 2019 Forest River Puma RV (the “2019
Puma”) from a Montana Forest River dealership for $34,613, financed over 180
months at 4.99% interest. (Doc. 45 at ¶¶ 44, 64.) The 2019 Puma caught on fire
while Nelson was driving it during a family trip. (Doc. 45 at ¶¶ 49–51.) Nelson
alleges that if the 2019 Puma “had been designed and assembled” in accordance with
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the safety standards that Forest River had purportedly adopted, “the fire would never
have occurred.” (Doc. 45 at ¶ 59.) Nelson alleges that contrary to Forest River’s
representations about the safety standards it had adopted, the 2019 Puma’s wiring
had no overcurrent protection, lacked protection against the weather and physical
damage, and used “inappropriate metal clamps and grommets to support the
electrical wiring exiting it.” (Doc. 45 at ¶ 56.) Nelson also alleges that the battery
wire lacked adequate jacketing and protection and was routed over sharp edges.
(Doc. 45 at ¶ 45.) Nelson contends that these features of the Defect violate NFPA
and RVIA/ANSI safety standards. (Doc. 45 at ¶¶ 46, 58.)
Nelson brought the 2019 Puma to a dealership for repair, but the repair left
the 2019 Puma with the same Defect. (Doc. 45 at ¶ 62.) Nelson lost the use of the
2019 Puma while awaiting repair. (Doc. 45 at ¶ 64.) Even after the repair, Nelson
did not feel safe driving the 2019 Puma, and Nelson traded it in for a new 2020 Puma
RV (the “2020 Puma”). (Doc. 45 at ¶ 64.) Nelson received a trade-in value of
$26,000 for the 2019 Puma, and the 2020 Puma cost $36,648. (Doc. 45 at ¶ 64.)
An electrician inspected the 2020 Puma and discovered that the 2020 Puma
suffered from the same Defect:
the RV had no overcurrent protection between the junction box and
house batteries; the wiring in the power cord going through the junction
box and into the RV battery compartment did not adequately protect
against the weather and physical damage; the junction box was a metal
residential junction box not designed for a wet environment that did not
protect against the weather and physical damage; the junction box used
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metal clamps and metal grommets to grasp and support the wires
exiting; and the battery wire was not jacketed or protected but exposed
at the junction box and routed over sharp edges as it ran through RV
framing and into the battery compartment without protection or a loom.
(Doc. 45 at ¶ 70.) Nelson paid the electrician more than $500 to repair the Defect in
the 2020 Puma. (Doc. 45 at ¶ 71.) The electrician replaced the power cord, metal
residential junction box, metal clamps and grommets with a HOTS 7-Way Trailer
Plug Cord Wiring Harness for RVs, a durable plastic waterproof housing junction
box, and rubber grommets. (Doc. 45 at ¶ 71.) The electrician filed down the sharp
edges between the RV framing and the battery compartment and added a protection
for the wire running from the transfer box to the battery compartment. (Doc. 45 at
¶ 71.) Finally, the electrician installed a 30-amp circuit breaker, a $15 item, to
provide overcurrent protection on the battery wire. (Doc. 45 at ¶ 71.) Together,
these repairs brought the 2020 RV into compliance with industry safety standards.
(Doc. 45 at ¶ 71.) Nelson alleges that he would not have purchased either the 2019
Puma or the 2020 Puma if he had known about the Defect. (Doc. 45 at ¶¶ 48, 68.)
In April 2024, Forest River inspected a 2020 Puma RV and audited its
assembly facilities. (Doc. 83 at 2, 6–7.) Forest River discovered a “potential
assembly error” that could result in the lack of overcurrent protection on the RV
(Doc. 83 at 2.) The charge line connected to the wrong side of the breaker (“the
Wiring Problem”). (Doc. 83 at 6–7.) As a result, “under certain conditions, the cord
may be pulled out of the junction box and cause a short circuit, increasing the risk
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of physical damage to surrounding portions of the trailer as well as increasing the
risk of a thermal event or fire.” (Doc. 83-2 at 2.) Forest River notified NHTSA that
it intended to recall “all 2006–24 model-year Puma RVs and 2004–24 model-year
Cedar Creek RVs” to fix the Wiring Problem. (Doc. 83 at 7.) Forest River dealers
can quickly “move the charge line to the protected side of the breaker” to repair the
Wiring Problem and supply overcurrent protection. (Doc. 83 at 8.) Under the Recall,
customers of affected RVs may either bring their RV to a Forest River dealer for a
free repair or receive a refund for repairs, “provided those repairs fall ‘within the
scope of this defect [the Wiring Problem] under recall.’” (Doc. 83 at 8.)
DISCUSSION
I.
Standard of Review
Forest River has moved to dismiss Nelson’s claims on prudential mootness
grounds under Federal Rule of Civil Procedure 12(b)(1). (Doc. 83.) Unlike Article
III mootness, prudential mootness represents an equitable doctrine grounded in the
court’s exercise of remedial discretion. Sierra Club v. Babbitt, 69 F. Supp. 2d 1202,
1244 (E.D. Cal. 1999) (citing Southern Utah Wilderness Alliance v. Smith, 110 F.3d
724, 727–28 (10th Cir.1997)).
“In some circumstances, a controversy, not
[constitutionally] moot, is so attenuated that considerations of prudence and comity
for coordinate branches of government counsel the court to stay its hand, and to
withhold relief it has the power to grant.” Bldg. & Const. Dep’t v. Rockwell Int’l
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Corp., 7 F.3d 1487, 1491–92 (10th Cir. 1993) (quoting Chamber of Commerce v.
United States Dep’t of Energy, 627 F.2d 289, 291 (D.C.Cir.1980)). The “central
inquiry as to prudential mootness is whether a court should exercise its discretion by
finding a case moot because the Court cannot grant meaningful relief.” Inst. for
Wildlife Prot. v. U.S. Fish & Wildlife Serv., No. 07-CV-358-PK, 2007 WL 4117978,
at *7 (D. Or. Nov. 16, 2007); Sierra Club, 69 F. Supp. 2d at 1244.
A court may “consider evidence outside of the pleadings for the purpose of
deciding a jurisdictional issue” in evaluating a motion to dismiss pursuant to Rule
12(b)(1). Farr v. United States, 990 F.2d 451, 454 (9th Cir. 1993). “[U]nlike a
motion under Rule 12(b)(6), the moving party may submit ‘affidavits or any other
evidence properly before the court . . . It then becomes necessary for the party
opposing the motion to present affidavits or any other evidence necessary to satisfy
its burden of establishing that the court, in fact, possesses subject matter
jurisdiction.’” Ass’n of Am. Med. Colleges v. United States, 217 F.3d 770, 778 (9th
Cir. 2000) (citations omitted). A court may take judicial notice of matters of public
record if the facts are not subject to reasonable dispute. Fed. R. Evid. 201; Lee v.
City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001).
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II.
Forest River’s Motion to Dismiss for Prudential Mootness
The doctrine of prudential mootness most often appears in claims for
“prospective equitable relief by declaratory judgment or injunction” when a
governmental entity has already changed the policy underlying the suit. Fletcher v.
United States, 116 F.3d 1315, 1321 (10th Cir. 1997); Winzler v. Toyota Motor Sales
U.S.A., Inc., 681 F.3d 1208, 1211 (10th Cir. 2012); Chamber of Com., 627 F.2d at
291. Similarly, when NHTSA, a coordinate branch of government, makes “a
remedial commitment” to ensure a private defendant issues a safety recall, its
assurance that the plaintiff will receive “precisely” the requested relief may render a
claim prudentially moot. Cheng v. BMW of N. Am., LLC, 2013 WL 3940815, *2
(C.D. Cal. July 26, 2013) (quoting Winzler, 681 F.3d at 1211).
“[W]hile equity may not require [courts] to duplicate efforts of the other
branches it hardly insists [courts] run the risk of leaving a plaintiff without a remedy
she’s entitled to.” Winzler, 681 F.3d at 1212. Though “reasonable minds might well
disagree about the ideal method” of noticing, repairing, or replacing a defect, the
NHSTA recall must “reach the same result” as the plaintiff’s requested relief in order
for a defendant to invoke the doctrine of prudential mootness. Id. at 1214.
The plaintiff in Winzler sought injunctive relief and an equitable fund to repair
defective “Engine Control Modules” that caused affected Toyota vehicles to stall.
Id. at 1209. After the plaintiff filed her claim, Toyota initiated an NHTSA recall
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that obligated Toyota “to notify owners of the defect and repair or replace any faulty
parts at no cost.” Id. The plaintiff argued that NHTSA oversight may not be
sufficient to ensure Toyota “fulfills its recall duties.” Id. at 1214. The plaintiff did
not “dispute that if the Act works as it is supposed to and NHTSA does its
legislatively assigned job, she will achieve a complete remedy.” Id. at 1215. The
Tenth Circuit held that because the NHTSA recall offered the plaintiff “a complete
remedy[,]” further judicial involvement would “offer not even a sliver of additional
relief for [the plaintiff] and members of the class she seeks to represent.” Id.
The same principle appears in Cheng. Cheng, 2013 WL 3940815. BMW
issued a recall for “precisely” the relief sought by plaintiffs: BMW would notify all
owners about the defect (a software problem that caused vehicles to shift into neutral
and roll away) and repair it for free. Cheng, 2013 WL 3940815, at *4. Plaintiffs
argued that the recall did not encompass all the model years in the putative class.
This argument failed because “prior to class certification, courts generally consider
only the claims of the named plaintiff.” Id. Though Cheng attempted to distinguish
the case from Winzler by arguing that the class sought money damages in addition
to injunctive relief, the complaint did not allege money damages. Id. For these
reasons, “it [was] unclear how Plaintiff [could] demonstrate injury in light of
BMW’s offer to completely repair the roll away defect.” Id.
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A NHTSA recall may render a case prudentially moot even if plaintiffs
“disagree with the approach taken by [the defendant company] to fix the problem.”
Pacheco v. Ford Motor Co., No. 22-11927, 2023 WL 2603937, at *4 (E.D. Mich.
Mar. 22, 2023), motion for relief from judgment dismissed, No. 22-11927, 2024 WL
188369 (E.D. Mich. Jan. 17, 2024). In Pacheco, engine oil and fuel vapor released
during engine failure presented a risk of fire. Id. at *1. Ford issued a recall,
supervised by NHTSA, that prevented the risk of fire by “improving air flow through
the engine compartment” to draw flammable fluid and vapors away in the event of
engine failure. Id. at 1. The plaintiffs argued that the repair created new problems,
including the environmental hazard of leaking fluids and additional drag on the
vehicle resulting in decreased fuel efficiency. Id. The plaintiffs did not dispute that
the recall resolved the fire risk. Id. at 4. The plaintiffs also failed to allege that the
engines leaked any fluid or that they experienced a reduction in fuel economy. Id.
Forest River argues that Nelson’s claims are moot because “Forest River has
committed to giving Nelson and the putative class members all of their desired
relief.” (Doc. 83 at 10.) To support this argument, Forest River concedes that
“Nelson is entitled to reimbursement—to the extent that the repairs fall under the
scope of the recall.” (Doc. 83 at 17.) Forest River does not assert, however, that the
Recall will reimburse Nelson for the $500 Nelson spent to have an electrician fix the
Defect in his 2020 Puma. Forest River distinguishes the numerous modifications
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that Nelson’s electrician performed (replacing metal clamps and grommets with
plastic grommets and a different wiring harness, installing a plastic waterproof
housing, adding protection to the wires, and filing down sharp edges) from a
compensable repair under the Recall (rerouting the charge line to the correct side of
the breaker to provide overcurrent protection). (Doc. 83 at 5 (citing Doc. 45 at ¶¶
70–71); Doc. 92 at 8–10.)
Apart from potentially compensating Nelson for the $15 circuit breaker
installed by his electrician to supply overcurrent protection, the Recall specifically
excludes the costs Nelson that incurred for his repairs that Forest Rivers argues were
unnecessary to mitigate any risk of fire. (Doc. 83-2 at 2; Doc. 92 at 9–10; Doc. 45
at ¶ 71.) Nelson alleges that under NFPA and ANSI/RVIA safety standards, a risk
of fire still exists, distinct from the Recall repair. (Doc. 45 at ¶¶ 41–59.) Unlike the
plaintiffs in Winzler and Cheng, who agreed that the recall fixed the defect in
question, Nelson does not agree that Forest River’s Recall “completely repair[s]” the
Defect. Cheng, 2013 WL 3940815, at *4; Winzler, 681 F.3d at 1215.
Even if the Recall had reimbursed Nelson fully for the cost of repairing the
2020 Puma, Nelson also alleges that Forest River falsely represented that it adhered
to NFPA and ANSI/RIVA safety standards and that but for these false
representations, he would not have purchased the RVs. (Doc. 45 at ¶¶ 48, 68.)
Regardless of whether the Recall entirely alleviates the fire risk, Nelson alleges that
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the wiring system does not conform to NFPA and ANSI/RVIA safety standards in
other ways and that these violations constitute a misrepresentation material to his
decision to purchase the RVs. (Doc. 45 at ¶¶ 5, 126–30.) Nelson’s requested relief
includes allowing Nelson and members of the putative class “to rescind their
contracts of sale, as appropriate, with [Forest River] and to be made economically
whole.” (Doc. 45 at p. 39, ¶ 9.) The Recall does not permit Nelson to rescind his
contract and receive full reimbursement for the cost of purchasing the 2019 and 2020
Pumas.
Forest River’s arguments, that the Recall’s repair of the Wiring Problem
obviates Nelson’s request for both injunctive relief and damages, rely on the
assumption that the Recall resolves both the Wiring Problem identified by Forest
River and the Defect identified by Nelson. The Defect and the Wiring Problems
differ. (Compare Doc. 45 at ¶ 71, ¶ 58 (“If Plaintiff’s 2019 Puma had been designed
and assembled [to conform with safety standards] as Defendant represented, the fire
would never have occurred.”), with Doc. 83 at 6–7 (“[T]he charge line—as it ran
from the trailer battery to the junction box—connected to the wrong side of a
breaker.”); Doc. 83-2 at 2.)
The authorities offered by Forest River depend upon the NHTSA recall
providing plaintiffs with “precisely the relief [they] seek[].” Cheng, 2013 WL
3940815, at *2 (quoting Winzler, 681 F.3d at 1211.) The Recall provides Nelson
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with $15 of the relief he seeks, at most. Compared with Nelson’s requested relief,
including rescission of his sales contract and full reimbursement for his purchase of
the Pumas, the Recall does not provide comparable compensation or address the
same source of injury: according to the industry safety standards cited by Nelson,
the risk of fire arises from other safety violations, not merely the lack of overcurrent
protection. Nelson’s case differs from Pacheco for the same reason. The plaintiffs
in Pacheco agreed that the recall entirely addressed the fire risk but argued that the
recall created other problems (reduced fuel efficiency and a potential environmental
hazard) in the process. Pacheco, 2023 WL 2603937, at *4. The Recall does not
forestall any occasion for meaningful relief and the Court does not risk creating dual
tracks for this case under its auspices and those of NHTSA.
CONCLUSION
Forest River has not shown that the Recall forestalls any occasion for
meaningful relief because Nelson alleges a different Defect and different bases of
relief from the Wiring Problem repair covered by the Recall. The Court will
DENY Forest River’s Motion to Dismiss Nelson’s claims for prudential mootness.
ORDER
Accordingly, IT IS HEREBY ORDERED that Forest River’s Motion to
Dismiss (Doc. 82) is DENIED.
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DATED this 23rd day of October, 2024.
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