NEALE et al v. VOLVO CARS OF NORTH AMERICA, LLC et al

Filing 419

OPINION. Signed by Chief Judge Jose L. Linares on 12/6/2017. (ld, )

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

JOANNE NEALE, KELLY MCGARY.
SVEIN A. BERG, GREGORY P. BURNS,
KAREN
KRUGER,
and
JEFFREY
COLLOPY individually and on behalf of
others similarly situated,

Civil Action No. 10-4407 (JLL)

OPINION

Plaintiffs,
V.

VOLVO CARS OF NORTH AMERICA, LLC
and VOLVO CAR CORPORATION,
Defendants.

LINARES, Chief District Judge

This matter comes before the Court by way of Plaintiffs’ Renewed Motion for Class
Certification. (ECF No. 399) (“Motion”). Defendants have filed their Opposition, (ECF No. 409),
and Plaintiffs have filed a reply, (ECF No. 412). The Court has read the submissions of the parties
and considers this matter without oral argument pursuant to Federal Rule of Civil Procedure 78.
For the reasons set forth below, the Court denies Plaintiffs’ Motion.
I.

BACKGROUND

This case involves a potential putative class action brought by six named Plaintiffs,
Gregory Bums, Karen Collopy, Svein Berg, Jeffrey Kruger, Joanne Neale, and Kelly McGary
(“Plaintiffs”), on behalf of themselves and five state subclasses of current and former Volvo

Defendants have also requested leave to file a sur-reply brief in opposition to Plaintiffs’ reply brief. (ECF No.
414). Plaintiffs then filed a motion for leave to file a sur-sur-reply brief (ECF No. 415). The Court addresses
these filings in its accompanying Order.

vehicle owners and lessees.2 Plaintiffs allege that Defendants Volvo Cars of North America, LLC
and Volvo Car Corporation (“Defendants”) sold certain vehicles with defective sunroof drainage
systems. Plaintiffs assert that a uniform design effect existed in the sunroof drainage systems in
six Volvo vehicle models: the S40, $60, $80, V70 (model years 2004 to 2011), XC9O (model years
2003 to 2011), and V50 (model years 2005 to 2011) (the “Class Vehicles”). The sunroof drainage
systems on the Class Vehicles allegedly contains defective sound plugs attached to the drainage
tubes, which trapped water within the passenger compartment floorpans. The water damaged
various parts of the Class Vehicles, including interior components, carpets, and safety related
electrical sensors and wiring. Plaintiffs allege that Defendants knew of the material design defect
based on numerous consumer complaints, internal Volvo communications, and Technical Service
Bulletins issued by Volvo in an unsuccessful attempt to solve the problem.
Named Plaintiffs all either owned or leased one of the Class Vehicles with a sunroof, and
experienced damage resulting from the aforementioned alleged defect. Plaintiff Kelly McGary
and her husband are residents of Florida. In 2004, they purchased a new 2004 Volvo XC9O from
Volvo of Tampa. Five years later, in December of 2009, Mrs. McGary heard a sloshing sound in
her car, and afier inspecting the area by the driver’s side door, she noticed that the carpet was wet.
Mrs. McGary brought the XC9O back to the dealership to address the sloshing sound and wet
carpet. Volvo of Tampa returned the car to Mrs. McGary, with an invoice dated December 19,
2009. According to the invoice, the dealership’s technician found that the sunroof drain was
blocked. The technician had to remove the “A pillar” and modify the sunroof drains. The repairs
cost Mrs. McGary roughly $700, and they were not covered by the warranty.

2

Plaintiffs have removed two of the named plaintiffs and dropped their proposed Maryland class. (ECF No. 401 at
16 n.36).

2

Plaintiff Joanne Neal is a resident of Massachusetts. Ms. Neale purchased a certified pre
owned 2005 V50 from DaIzell Volvo on October 25, 2008. In March of 2010, Ms. Neale heard a
sloshing noise while driving. She brought her car back to Daizell, and the dealership told Ms.
Neale she had a clogged sunroof drain. Dalzell charged $592.48 for the repair, which was not
covered by the warranty. Ms. Neale did receive a free rental car while Dalzell repaired her vehicle.
Plaintiff Gregory Bums is a resident of New Jersey. On May31, 2006, Mr. Bums and his
spouse signed a three-year lease agreement for a 2006 V50 with Red Bank Volvo, Inc., a New
Jersey dealership. In March of 2010, Mr. Bums noticed water leaking from the area around the
rear driver’s side floorboard. After using a wet vac to remove the water, Mr. Bums brought the
car to Garden State Volvo, which diagnosed the problem as a clogged sunroof drain.

The

technician had to replace the sound plug and reinstall the sunroof drain, which cost Mr. Bums
$258.82.
Plaintiff Karen Collopy is a citizen of New Jersey. Ms. Collopy purchased a pre-owned
2007 S40 from Red Bank Volvo in New Jersey in February 2007. Five years later, in February
2012, Ms. Collopy brought her car to the Volvo Clinic after noticing water inside her vehicle. The
technician detennined that one drainage tube on Ms. Collopy’s car was clogged and that the other
was disconnected. The technician advised Ms. Collopy that she needed to replace the carpet of her
car. The cost of the repair for the tubes was $96, and the cost to replace the carpet was $1,197.
Plaintiff Jeffrey Kruger is a resident of California. Mr. Kruger purchased a new 2005 S40
on July 31, 2005 from Volvo of Pleasanton, in California. On January 28, 2012, Mr. Kruger found
about an inch of standing water in the front driver’s side footwell following a rainstorm. Mr.
Kruger then brought his car to Precision Motors, where the technician found that Mr. Kruger’s

3

sunroof drain was plugged on the left side. The technician had to clean the sunroof drain, remove
the driver’s seat and front carpet, and dry out the rest of the vehicle.
Plaintiff Svein Berg is a resident of Hawaii. On January 28, 2007, Mr. Berg purchased a
used 2004 XC9O from Pflueger Acura in Hawaii. Mr. Berg repeatedly found water on the floor of
his vehicle. In August 2009, after drying up standing water on the floor of his car, Mr. Berg started
up his car. The dashboard displayed an urgent message, and Mr. Berg decided to bring the car to
his mechanic. Following a diagnostic examination, the mechanic told Mr. Berg that he needed to
replace the yaw sensor. In January 2010, Mr. Berg again found water in his vehicle. Mr. Berg
found a description of the sunroof drainage pipe repair online and brought it with him to the
mechanic. Mr. Berg asked the mechanic to cut the hose according to the instructions he found
online. The repair cost Mr. Berg about $187.50, and in July 2010, Mr. Berg sold his XC9O to a
private party in Hawaii.
Plaintiffs filed an initial Motion for Class Certification in this Court before Judge Dennis
M. Cavanaugh on August 7, 2012. (ECF No. 85). Judge Cavanaugh issued an Opinion on March
26, 2013 denying Plaintiffs’ motion to certify a nationwide class, but certifying Plaintiffs’
proposed state subclasses. Neale v. Volvo Cars ofN.A., LLC, No. 10-4407 (DMC)(MF), 2013 WL
1223354, at *8 (D.N.J. Mar. 26, 2013). Plaintiffs proposed a nationwide class of”[a]ll persons or
entities in the United States who are current or fonTler owners and/or lessees of a Class Vehicle.”
Id. at *4 Judge Cavanaugh determined that Plaintiffs’ proposed nationwide class “ignores the
state in which the transaction occurred, the state where the purchasers of the vehicles live, and the
interests of the states in which the transactions took place,” and thus refused to certify the proposed
nationwide class. Id. at *8.
Plaintiffs also proposed a series of state subclasses consisting of:

4

•

“All persons or entities in Massachusetts who are current or former owners and/or

lessees of a Class Vehicle (the ‘Massachusetts Class’).
•

All persons or entities in Florida who are current or former owners and/or lessees of a
Class Vehicle (the ‘Florida Class’).

•

All persons or entities in Hawaii who are current or former owners and/or lessees of a
Class Vehicle (the ‘Hawaii Class’).

•

All persons or entities in New Jersey who are current or former owners and/or lessees
of a Class Vehicle (the ‘New Jersey Class’).

•

All persons or entities in California who are current or fonner owners and/or lessees of
a Class Vehicle (the ‘California Class’).

•

All persons or entities in Maryland who are current or fonner owners and or lessees of
a Class Vehicle (the ‘Maryland Class’).”

Id. at *4_5 Judge Cavanaugh found that the state subclasses satisfied the requirements of Rules

23(a) and 23(b)(3) and certified the state subclasses. Id. at *8_12
Defendants then filed a motion for reconsideration, (ECF No. 281), which Judge
Cavanaugh also denied. (ECF No. 289). Defendants subsequently filed an appeal, (ECF No. 297),
and the Third Circuit issued an opinion vacating the District Court’s certification of the state
subclasses and remanding the case to the District Court, Neate v. Volvo Cars of N.A., LLC, 794
F.3d 353 (2015). The Third Circuit found that the District Court’s certification order did not
specify the claims certified, failed to limit the “Class Vehicles” to those with sum-oofs, and
concluded that the Court’s predominance analysis “made no distinction between the six statewide
classes or the relevant claims brought by those putative classes.” Id. at 369—71. On remand, the

5

Third Circuit requested that this Court “define the class membership, claims, and defenses, and.
rigorously analyze predominance in the first instance.” Id. at 375.
Plaintiffs now seek certification of five state subclasses under Federal Rules of Civil
Procedure 23(b)(3) and 23(b)(2). This Court now addresses Plaintiffs’ Motion in light of the Third
Circuit’s guidance.
II.

LEGAL STANDARD

“Class certification is proper only ‘if the trial court is satisfied, after a rigorous analysis,
that the prerequisites’ of Rule 23 are met.” In re Hydrogen Peroxide Antitrust Litig., 552 f.3d
305, 309 (3d Cir. 2008) (quoting Gen Tel. Co. of Sw. v. falcon, 457 U.S. 147, 161 (1982)). To
meet the prerequisites of Rule 23, Plaintiffs must establish both that the four requirements of Rule
23(a) have been met

—

those being nurnerosity, commonality, typicality, and adequacy

—

as well as

that the pleading requirements of Rule 23(b)(l), (2), or (3) have been met. Fed. R. Civ. P. 23; see
also Hydrogen Peroxide, 552 F.3d at 309 n.6.

Plaintiffs must also establish that the class is

ascertainable, since “[a]scertainability functions as a necessary prerequisite (or implicit
requirement) because it allows a trial court effectively to evaluate the explicit requirements of Rule
23.” Byrdv. Aaron’s Inc., 784 F.3d 154, 162 (3d Cir. 2015).
In analyzing whether Rule 23’s requirements have been met, “the district court must make
whatever factual and legal inquiries are necessary and must consider all relevant evidence and
arguments presented by the parties.” Hydrogen Peroxide, 552 F.3d at 307. This is true even if
the class certification inquiry overlaps with the merits of the causes of action. Id.
Rule 23(b)(3) requires a finding “that the questions of law or fact 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

6

controversy.” Fed. R. Civ. P. 23(b)(3); see also Hydrogen Peroxide, 552 F.3d at 3 10. “Because
the nature of the evidence that will suffice to resolve a question determines whether the question
is common or individual, a district court must formulate some prediction as to how specific issues
will play out [at trial] in order to determine whether common or individual issues predominate in
a given case.” Hydrogen Peroxide, 552 F.3d at 311 (citations and quotations omitted). “If proof
of the essential elements of the cause of action requires individual treatment, then class
certification is unsuitable.” Id. (quoting Newton v. Merrill Lynch, Pierce, Fenner & Smith,
Inc., 259 F.3d 154, 172 (3d Cir. 2001)). Therefore, in addition to the four requirements of Rule
23(a). Plaintiffs in this case bear the burden of establishing that common issues of fact and law
predominate and that a class action is superior.

III.

ANALYSIS

If a District Court has doubts as to whether Rule 23 requirements are met, that court should
not certify the class. Hydrogen Peroxide, 552 F.3d at 321. This Court has doubts as to the clarity
of Plaintiffs’ class definitions as well as the ascertainability of each subclass.
A. The Class Definitions

“An order that certifies a class action must define the class and the class claims, issues, or
defenses..

.

.“

Fed. R. Civ. P. 23(c)(l)(B). The class definition in a court’s order or opinion must

include: “(1) a readily discernible, clear, and precise statement oftheparameters defining the class
or classes to be certified, and (2) a readily discernible, clear, and complete list of the claims, issues
or defenses to be treated on a class basis.” Wachtel v. Guardian Life Ins. Co., 453 f.3d 179, 187—
$8 (3d Cir. 2006).
Plaintiffs define the state subclasses as follows:

7

•

“[State]3 Class: All persons or entities who purchased or leased a Class Vehicle within
[State] who: (1) currently own or lease that Class Vehicle, or (2) previously owned or
leased that Class Vehicle and can offer proof or otherwise be identified as having incurred
out-of-pocket expenses related to the Sunroof Defect.”

(ECF No. 401 at 16—17). Plaintiffs also make clear that the terms “lease” and “leased” in the class
definition refers to lessees rather than lessors. (Id. at 16 n.37). Plaintiffs seek certification of the
following claims found in the Second Amended Complaint, (ECF No. 66):
•

New Jersey Claims Asserted by the New Jersey Class: New Jersey Consumer Fraud Act
(Count I); Breach of Express Warranty (Count II); Breach of the Implied Warranty of
Merchantability (Count III); and Breach of the Duty of Good Faith and Fair Dealing (Count
V).

•

California Claims Asserted by the California Class: Breach of Express Warranty (Count
II); Breach of the Implied Warranty of Merchantability (Count III); Breach of the Duty of
Good Faith and Fair Dealing (Count V); California Unfair Competition Law, CAL. Bus. &
PROF. CODE

§

17200 et seq. (Count IX); and California Consumer Legal Remedies Act,

CAL. Civ. CODE.

•

§ 1770 (Count X).

Massachusetts Claims Asserted by the Massachusetts Class: Breach of Express Warranty
(Count II); Breach of the Implied Warranty of Merchantability (Count III); Breach of the
Duty of Good Faith and Fair Dealing (Count V); and Massachusetts Consumer Protection
Act. MASS. GEN. LAWS ch. 93A, §1, etseq. (Count VI).

The applicable states are New Jersey, California, Massachusetts, Florida, and Hawaii.

8

•

Florida Claims Asserted by the Florida Class: Breach of Express Warranty (Count II);
Breach of the Duty of Good faith and Fair Dealing (Count V); and Florida Deceptive and
Unfair Trade Practices Act, F LA. STAT.

•

§ 501 .201, et seq. (Count VII).

Hawaii Claims Asserted by the Hawaii Class: Breach of Express Warranty (Count II);
Breach of the Implied Warranty of Merchantability (Count III); Breach of the Duty of Good
Faith and Fair Dealing (Count V); and Hawaii Uniform Deceptive Trade Practice Act,
RAw. REV. STAT.

§ 48 lA-i (Count VIII).

(ECF No. 401 at 17—18).
B. Ascertainability

The Third Circuit recently laid out in clear terms the scope of the ascertainability inquiry. See
Byrd, 784 F.3d at 161—65. To satisfy the ascertainability requirement, a class must be “defined
with reference to objective criteria,” and there must be “a reliable and administratively feasible
mechanism for determining whether putative class members fall within the class definition.” Id.
at 163 (quoting Hayes v. Wa/-Mart Stores, Inc., 725 F.3d 349, 355 (3d Cir. 2013)). Notably,
Plaintiffs need not identify all class members at the certification stage. Id. All that is required is
that they show that the class members “can be identified.” Id. (quoting Carrera, 727 F.3d at 308
n.2). However, Plaintiffs “cannot merely provide assurances to the district court that it will later
meet Rule 23’s requirements.” Id. at 164. (citing Carrera, 727 F.3d at 306). Plaintiffs must also
have some evidentiary support that their method of ascertaining a class will be successful. Id.
i.

The State Subclasses Are Not Properly Defined

Defendants argue that these class definitions are “obtuse,” lack clarity, create choice of law
problems, include entities who cannot recover under consumer fraud statutes, and require

9

“imperniissible and impossible merits determinations.” (ECF No. 409 at 13—18). Defendants are
correct that the class definitions that Plaintiffs provide suffer from definitional deficiencies.
Critically, Plaintiffs’ class definitions lack any class period. (ECF No. 401 at 16—17). This
creates issues regarding the used vehicle market, in that new purchases of used Class Vehicles
could create a seemingly endless supply of new potential class members.4 See Byrd, 784 F.3d at
165 (stating that the ascertainability requirement mandates that the plaintiff show that class
members can be identified). While not necessary, as there are date ranges for each Class Vehicle
model, a beginning date for the class period would substantially clarify expected issues regarding
statutes of limitations, and help eliminate individual inquiries in that regard.
Defendants claim that it is unclear whether members of the proposed classes “must have
resided in one of the designated states at the time of purchase.” (ECF No. 409 at 13). As written,
the class definitions clearly indicate that the class members are members of the state class where
they purchased or leased the Class Vehicle. The state of residency is not a component of the class
definition. Defendants then argue that “defining the proposed classes by reference to the state of
purchase or lease does not eliminate the need for a choice-of-law analysis.” (Id. at 16).
In Maniscalco

i’.

Brother mt ‘1 (USA) Corp., the Third Circuit addressed the choice-of-law

problem in a class action based on a defective product.5 709 F.3d 202 (3d Cir. 2013). “Where a
fraud or misrepresentation claim has been alleged, the court looks to the factors set forth in

§ 148

of the Restatement (Second) of Conflict of Laws.” Id. at 207. These factors are:

In light of the various other deficiencies in Plaintiffs’ class definitions, the Court declines Plaintiffs’ invitation to
impose its own back end limitations on the class definition, (ECF No. 412 at 2).
“A federal court sitting in diversity applies the choice-of-law rules of the forum state.” Maniscctlco, 709 F.3d at
206. Thus, this Court applies the choice-of-law rules of New Jersey. New Jersey applies the “most significant
relationship” test in the Restatement (Second) of Conflict of Laws. F. V i’. Camp Jaycee, 962 A.2d 453, 459—60
(N.J. 2008). The first step in the most significant relationship test is to determine whether or not an actual conflict
exists between the laws of the forums. Id. at 460. Judge Cavanaugh previously determined that the application of
Maniscalco to the facts at hand “requires application of the law of each putative class member’s home state to that
class member’s claims.” Neate, 2013 WL 1223354, at *8.

10

(a) the place, or places, where the plaintiff acted in reliance upon the defendant’s
representations, (b) the place where the plaintiff received the representations, (c)
the place where the defendant made the representations, (d) the domicil, residence,
nationality, place of incorporation and place of business of the parties, (e) the place
where a tangible thing which is the subject of the transaction between the parties
was situated at the time, and (f) the place where the plaintiff is to render
performance under a contract which he has been induced to enter by the false
representations of the defendant.
Restatement (Second) of Conflict of Laws

§ 148(2).

Here, the class definitions ensure that the state named in the subclass is the state where the
car was located at the time of the transaction. Thus, factor (e) weighs in favor of the place of
purchase, yet factors (b) and (d) weigh in favor of the state of residence. Defendants are right to
note that the increase of automobile purchases over the Internet makes it increasingly unlikely that
a buyer or lessee resides in the same state where he or she purchased the automobile. (ECF No.
409 at 16 n.32). Even assuming the Internet did not facilitate interstate automobile transactions,
consumers still might cross state lines to purchase a car, and Plaintiffs have provided no evidence
that all putative state subclass members reside in the state where they purchased or leased their
Class Vehicle. Factor (a) is thus ambiguous and could weigh in favor of the state of residence, the
state of purchase, or a third unrelated state. The Court in Maniscalco aptly notes that, under
Section 6 of the Restatement and New Jersey law, the interests of interstate comity weigh in favor
of applying the law of a putative class member’s state of residence, 709 F.3d at 209, which further
complicates the issue.
Defendants also attack the “current owner” definition of the class as it applies to leased
vehicles, arguing that it is unclear whether that includes the current lessee, the current owner
lessor, or both. (ECF No. 409 at 13). While Plaintiffs state in their opening brief that “the terms

11

‘lease’ and ‘leased’ used in the class definitions refer to lessees and not lessors,” (“ECF No. 401
at 16 n.37), this is not clear from the definition of the class itself.6
Defendants are also correct that the use of the word “entities” in the class definitions creates
definitional problems, as “entities” that purchase goods for resale cannot recover under the
NJCFA. See Bracco Diagnostics, Inc.

Bergen Brttnswig

Drttg Co., 226 F. Supp. 2d 557, 560—

61 (D.N.J. 2002) (“We note that New Jersey ‘courts have consistently concluded that purchaser[s]
of wholesale goods for resale are not consumers within the meaning of the NJCFA.”) (quoting
Lithuanian Commerce Corp. v. Sara Lee Hosiety, 179 F.R.D. 450, 469 (D.N.J. 1998))]

Defendants do en, however, where they argue that the “former owners” definition
“requires merits determinations regarding defect, causation, and damages.” (ECF No. 409 at 18).
This is because, as Defendants claim, a finding of a defect “would not resolve whether unidentified
class members incurred out-of-pocket expenses related to the alleged defect.” Id. All this would
require, in the event of a finding of default, is some level of inquiry and review of individual files
to identify class members, which is

not a reason to

deny class certification. Byrd, 784 f.3d at 171.

If the Court finds, in the alternative, that there is no defect, Defendants argue that these
“former owners” will not be bound by the judgment. (ECF No. 409 at 19). The Court disagrees.
The Sixth Circuit case that Defendants cite to support this proposition is entirely distinguishable.
In Randteman v. fid. Nat ‘1 Title Ins. Co., the Sixth Circuit addressed the certification of a class
defined as those “entitled to relief” 646 F.3d 347, 352 (6th Cir. 2011). The Sixth Circuit found
this class definition inappropriate because it encompassed the outcome of the litigation. That is

6

Though not conclusive, it is informative that Plaintiffs’ own class settlement administration and notice expert,
Patrick Passarella, could not interpret the class definitions. (ECF No. 410, Ex. 35 at 65:15—18).
Entities purchasing cars for retail are similarly prohibited from recovering under the California and Hawaii
consumer protection statutes. See Ewert v. eBay, Inc., Nos. C—07—02 198, C—07—04487, 2010 WI 4269259, at *9
(ND. Cal. Oct. 25, 2010) (stating that entities cannot recover under the Consumer Legal Remedies Act if they are
engaged in business practices); Sting v. Hamilton, 710 F. Supp. 2d 1036, 1052 (D. Haw. 2010) (“Chapter 480 was
specifically designed to protect individual consumers rather than businesses.”).

12

not the case here. The “former owners” portion of each subclass is defined as those who “can offer
proof or otherwise be identified as having incurred out-of-pocket expenses related to the Sunroof
Defect.” (ECF No. 401 at 16). These “former owners” would be bound by the Court’s decision
that there is no defect in the sunroof drainage system on the Class Vehicles, and thus there would
be no unlawful omission.
Despite the permissibility of individual inquiries to identify certain class members, the
Court still finds that the putative state subclasses are not “defined with reference to objective
criteria.” Byrd, 784 f.3d at 163.
ii.

The State Subclasses Cannot be Reliably or feasibly Determined

Defendants argue that there is no way Plaintiffs can determine which states the class
members purchased their used Class Vehicles in, as required by the class definitions. (ECF No.
409 at 19). As the Third Circuit articulated in Byrd, Plaintiffs need not identify all class members
at this stage; they simply must show that it can be done and provide evidence as to how. 784 F.3d
at 163—64. Plaintiffs claim they have identified an administratively feasible scheme to identify
class members, using data from IRS Markit. (ECF No. 401 at 21; ECF No. 401-1 ¶4). This data
includes titles, registration transfers, and renewals in all 50 states, and includes original,
intervening non-current, and current owners. (ECF No. 401-1

¶

5). Once Plaintiffs match that

data with the Vehicle Identification Numbers (“VINs”) provided by Volvo, Plaintiffs would obtain
the mailing addresses necessary for notice.8 (Id.

¶J 6—7).

Plaintiffs have also identified a means

to determine where a Class Vehicle was sold. IRS “tracks vehicle ownership through state title

Previous class actions against Volvo indicate that Volvo maintains the records necessary to ascertain class members.
See Henderson v. Volvo Cars of N. Am., LLC, No. 09-4146 (CCC), 2013 WI 1192479, at *3 (D.N.J. Mar. 22, 2013)
(noting that Volvo provided a list of over a 100,000 unique class members); Mem. in Supp. of Prelim. Approval of
Settlement, Trew v. Volvo Cars ofN. Am., LLC, No. 05-1379 (ED. Cal. Feb. 2007) (noting that Volvo provided
Class Member address information, which was supplemented by motor-vehicle registration data from R.L. Polk &
Co).

13

and registration records,” making it “possible to identify vehicles that have moved between states
and were subsequently registered in another state.”9 (Id.

¶ 8). If that method of identification

proved difficult, Plaintiffs have also shown that CARFAX, which maintains a database of over 17
billion records, provides a detailed history of an automobile, including the state in which it was
bought and sold. (See ECF No. 412 at 5—6).
The evidence discussed in the prior paragraph establishes that Plaintiffs have also shown
that they can identify former owners who have incurred out-of-pocket expenses. Defendants assert
that the identification of such class members is impossible, because it would require unidentified
class members to bring in repair records. (ECF No. 409 at 24). However, it is this very kind of
proof of class membership that ensures the viability of Rule 23(b)(3) class actions. The Third
Circuit noted that:
There will always be some level of inquiry required to verify that a person is a
member of a class; for example. a person’s statement that she owned or leased [the
product at issue] would eventually require anyone charged with administering the
fund resulting from a successful class action to ensure that person is actually among
[the class members]. Such a process of identification does not require a “mini
trial,” nor does it amount to “individualized fact finding,”. and indeed must be
done in most successful class actions.
.

.

Byrd, 784 F.3d at 170—71 (quoting Carrera, 727 F.3d at 307)).
In fact, the Second Circuit decision Defendants rely on to support their assertion that

certification of this class would constitute an impermissible opt-in class acknowledges the
difference between an opt-in class and the necessity of a post-liability determination claim filing.
See Kern v. Siemens Corp., 393 F.3d 120, 126—27 (2d Cir. 2004) (noting that there is a critical

difference between requiring unnamed plaintiffs to opt in prior to a determination of liability and
requiring unnamed plaintiffs to take action to obtain ultimate relief). Defendants also raise the

IHS has since bought R.L. Polk & Co.
14

concern that their due process right to challenge the evidence that the “out-of-pocket expenses
were ‘related’ to a ‘Sunroof Defect” creates the likelihood of extensive mini-trials. (ECF No. 409
at 24). This due process right is specifically limited to Defendants’ “ability to ‘challenge the proof
used to demonstrate class membership.”

Byrd,

784 F.3d at 171 (quoting Carrera, 727 F.3d at

307). Such a right does not restilt in an irnperrnissible mini-trial. See id.

(noting

that the class was

ascertainable despite the defendant’s right to challenge evidence used to demonstrate class
membership).
However, this Court still finds holes in the reliability of Plaintiffs’ scheme to identify class
members. As Defendants suggest, the bulk of the class is likely to consist of former owners. (ECF
No. 409 at 20). These former owners must still prove the state in which they purchased the Class
Vehicle. Using the CARFAX report appears administratively feasible for current owners, but for
former owners who no longer know or possess the VfN number of their former Class Vehicle,

such a method could be unwieldy. Furthermore, Plaintiffs have not provided the Court with any
of the IHS data, which they suggest allows them to identify the state of purchase for former owners.
As such, the Court has no way of assessing the reasonableness of Plaintiffs’ proposed scheme for
this subset of the proposed class. Finally, Plaintiffs have also failed to brief the Court on the
percentage of Class Vehicles that may have changed hands in private transactions, such as Mr.
Berg’s private sale of his XC9O in July of 2010. Plaintiffs’ have given no indication that such
transactions show up on a CARFAX report, and in fact the CARFAX report for Mr. Berg’s
XC9O—which Plaintiffs themselves submitted—shows no transaction in July 2010. (ECF No.
4 12-1, Ex. 8). Nor have Plaintiffs shown that such private person-to-person transactions show up
in IHS data. Thus, the Court has doubts as to the ascertainability of that portion of each proposed
state subclass. See Byrd, 784 F.3d at 164 (stating that a “party cannot merely provide assurances

15

to the district court that it will later meet Rule 23’s requirements” and that “a party [cannot] ‘merely
propose a method of ascertaining a class without any evidentiary support that the method will be
successful.”) (quoting Carrera, 727 F.3d at 306—07).
Given the issues stated above, the Court finds that Plaintiffs’ proposed state subclasses are
not ascertainable. Ascertainability is a prerequisite to the Court’s Rule 23(b)(3) analysis, and as
such, the Court cannot conduct the necessary inquiry to certify Plaintiffs’ proposed Rule 23(b)(3)
class.’0 Marctts v. BMW of N. Am., LLC, 687 f.3d 583, 592—93 (3d Cir. 2012) (recognizing
ascertainability as an “essential” prerequisite to a 23(b)(3) class action).
C. Plaintiffs’ Rule 23(b)(2) Class
Plaintiffs also seek certification of a Rule 23(b)(2) settlement class. Ascertainability is not
a requirement for the certification of a Ru1e23(b)(2) class. Shelton v. Bledsoe, 775 F.3d 554, 563
(3d Cir. 2015). Certification of a Rule 23(b)(2) class is appropriate where the “final injunctive
relief or corresponding declaratory relief is appropriate respecting the class as a whole.” Fed. R.
Civ. P. 23(b)(2). Plaintiffs request an order that Volvo repair or replace the defective component
in the Sunroof Drainage System, “extend the warranty to a reasonable period of time and, at a
minimum, provide Class members with appropriate notification of the existence of the defect and
the necessary maintenance instructions.” (ECF No. 401 at 39—40). Such relief plainly can only
benefit current owners of a Class Vehicle and not former owners. As such, Plaintiffs’ request for
class certification under Rule 23(b)(2) is denied. See Gates v. Rohm and I-facts Co., 655 F.3d 255,
262 (3d Cir. 2011) (noting that Rule 23(b)(2) relief is only appropriate where the injunction or
declaratory judgment would provide relief to each class member). Plaintiffs suggest that “any

‘°

The Court notes that Plaintiffs, in the event they seek recertification, should fully brief the predominance
requirements as to all claims under the laws of each applicable state, as opposed to conducting the analysis solely
under New Jersey law and appending the laws of the other four states to their brief.

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class certified pursuant to Rule 23(b)(2) can apply only to those class members that currently

own

Class Vehicles,” however, Plaintiffs do not propose a separate class definition for this class, and
the split between current and former owners of the Class Vehicles remains relevant.
D. Appointment of Additional Class Counsel

Plaintiffs counsel requests that this Court appoint McCune Wright Arevalo LLP as co-lead
counsel, alongside Chimicles & Tikellis and Mazie Slater Katz & Freeman. (ECF No. 401 at 26—
27). The Court reserves decision on Plaintiffs’ counsel’s request until Plaintiffs, if they so choose,
move to recertify the class.
IV.

CONCLUSION
For the aforementioned reasons, the Court denies Plaintiffs’ motion to certify a class

pursuant to Federal Rules of Civil Procedure 23(b)(3) and 23(b)(2) without prejudice, and with
leave to move to recertify in a manner that is consistent with the guidance set forth herein. An
appropriate order accompanies this Opinion.

DATED: December_72017
United States District Court

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