18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 521 created when Defendants stated that they were not responsible for “the untimely receipt of an acceptable appraisal” in the “Disclosure” section of the contract. Id. at *20-21. The Fourth Circuit reasoned, however, that such language merely limited Defendants’ liability for delays, and that Defendants’ contractual obligation was instead created in the “Deposit Agreement” section. Id. at *21. Consequently, the Fourth Circuit vacated the District Court’s ruling on this issue and remanded for the District Court to determine whether the contract was breached. Brame, et al. v. General Motors , 2021 U.S. Dist. LEXIS 78234 (E.D. Wis. April 23, 2021). Plaintiffs brought a putative class action on behalf of themselves and other car purchasers alleging that certain vehicles that Defendant manufactured were defective because they consumed excessive oil. Specifically, Plaintiffs’ complaint alleged claims of: (i) breach of express warranty; (ii) fraudulent misrepresentation; and (iii) unjust enrichment. Defendant moved to dismiss the complaint pursuant to Rule 12(b)(6), for failure to state a claim, and the Court dismissed Plaintiff’s complaint in its entirety. First, as to Plaintiff’s claim of breach of express warranty the Court found that Plaintiffs had not sufficiently alleged that they had provided notice of the alleged breach to Defendant or asked that Defendant repair their vehicles during the warranty period. The Court reasoned that the limited warranty did not guarantee that Plaintiffs would never experience a defect; instead, it promised that if a defect became apparent during the warranty period, Defendant would repair it free of charge. As such, the Court determined that because Plaintiffs failed to allege that Defendant breached the limited warranty by failing to fix a defect, the claims for breach of express warranty must be dismissed. Further, the Court pointed out that even if Plaintiffs had alleged a breach, their claims would have been dismissed for failure to give pre-suit notice of the alleged breach. In addition, the Court dismissed Plaintiffs’ claims for fraudulent misrepresentation on the grounds that they were barred by the economic loss doctrine. The Court noted that Plaintiffs sought to recover economic losses for Defendant’s omissions that the vehicles’ engines consumed excessive amounts of oil. The economic loss doctrine applied to common law fraud claims alleging that the seller of a product made misrepresentations pertaining to the character and quality of the goods that were the subject matter of the contract. In the present case, Plaintiffs alleged that Defendant made various statements touting the quality of the vehicles and their engines but did not disclose that the engines consumed excessive amounts of oil. The Court determined that these statements and omissions related to the character and quality of the vehicles and their engines. Moreover, Plaintiffs sought to recover the economic losses that they suffered because of the omissions. Accordingly, the Court ruled that Plaintiffs’ claims for fraudulent misrepresentation were barred by the economic loss doctrine. Finally, the Court dismissed Plaintiff’s unjust enrichment claim. In its ruling, the Court reasoned that the basic problem with Plaintiffs’ claim was that, to the extent that Plaintiffs conferred a benefit on Defendant by purchasing its vehicles from independent dealers, Plaintiffs received something of value in return, i.e. , the vehicles that Defendant had manufactured. To the extent that Plaintiffs conferred a benefit on Defendant by purchasing Defendant’s vehicles from independent dealers, Plaintiffs received something of value in return (the vehicles). For these reasons, the Court dismissed Plaintiffs’ complaint pursuant to Rule 12(b)(6). Estakhrian, et al. v. Obenstine, 859 Fed. App’x 121 (9th Cir. 2021). Plaintiffs filed a class action alleging breach of fiduciary duty, as well as violation of the California Unfair Competition Law and Consumers Legal Remedies Law in connection with Defendant’s representation during a state court case. Following a bench trial, the District Court ordered Defendant to disgorge $12 million in attorneys’ fees. On appeal, the Ninth Circuit affirmed the District Court’s ruling. First, Defendant argued that Plaintiff lacked standing to bring his claims because he did not assert a financial loss stemming from Defendant’s conduct. The Ninth Circuit, however, stated that there were two named Plaintiffs and the other Plaintiff alleged that Defendants caused him to lose money by encouraging him and the other class members to accept a settlement returning only a fraction of the deposits they paid to purchase condos. The named Plaintiff also testified at trial that he did not get the total amount of the deposit back and was not returned the full retainer he had advanced to Defendant. Id . at 121. Thus, the Ninth Circuit found that Plaintiffs had standing. Defendant also argued that the District Court erred in granting class certification because the claims arose under California law, but "nearly 50% of the class members” were residents of “Nevada or other states who complain, if at all, of actions taken in Nevada." Id . at 122. The Ninth Circuit rejected this argument. It opined that Defendant worked from his office in California, which included sending and receiving the retainer agreements, and the claims mainly concerned Defendant’s violations of his obligations as a California lawyer under California law. Finally, Defendant contended that by ruling on his motion for summary judgment before the motion for class certification, the District Court violated the