In re Ford Motor Co. E-350 Can Products Liability Litigation (No. II)

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2012 U.S. Dist. LEXIS 13887, *Page 4All persons or entities residing in theState of [state] who purchased or otherwiseacquired and currently own a FordE-350 van, new or used, model years1991-2005.(Id.). Plaintiffs contend these proposed classes satisfy thenumerosity, commonality, typicality, and adequacy requirementsof Federal Rule of Civil Procedure 23(a),[*9] and that common questions of law and fact predominateover individual considerations, rendering classlitigation a superior method of adjudication for purposesof Federal Rule 23(b)(3). Alternatively, Plaintiffs seekclass certification pursuant to Federal Rule 23(b)(2), arguingthat the "core of the relief sought by Plaintiffs inthis case is equitable in nature." (Pls.' Br. at 61). To assistthe Court's review of their proposed classes, Plaintiffssubmit a proposed trial plan. Ford objects to all of Plaintiffsproposed classes.The main thrust of Plaintiffs' certification argumentis that Chief Judge Brown's summary judgment rulingshave pared down the initial proposed classes into manageablegroups, and that the new proposed classes satisfythe predominance requirement of Federal Rule 23(b)(3).For the remaining implied warranty claims, which derivefrom each state's version of UCC § 2-314, Plaintiffs contendthat they can present common proof of a designdefect, the existence of an implied warranty, causation,and a common injury measured by the difference invalue between the product as warranted and the productas received per UCC § 2-714. Although Plaintiffs suggestedmeasuring [*10] their common injury by the costof retrofit in their initial motion for class certification(see Doc. No. 254 at 47 n.15), Plaintiffs now set forth auniform retrofit cost of $2,100 as their common proof ofinjury. With regard to the remaining consumer fraudclaims, Plaintiffs assert that they can present commonproof of Ford's alleged misrepresentations, deception,ascertainable loss, and causation. Conversely, Plaintiffsargue that they do not need to make individual showingsof reliance in order to establish their consumer fraudclaims. Finally, with regard to the remaining unjust enrichmentclaims, Plaintiffs state that they can presentcommon proof of unjust benefit to Ford, stemming fromthe fact that Ford did not disclose the E-350 van's defect(inability to carry fifteen passengers).Ford contests Plaintiffs' assertion that they can establishtheir remaining claims with common proof underthe applicable law of the remaining jurisdictions. Fordargues that many of the elements necessary to establishPlaintiffs' claims--such as deception and causation--willrequire individualized inquiries into the circumstances ofeach class member's claims. In addition to these individualized[*11] inquiries on the elements of Plaintiffs'claims, Ford argues that its statute of limitations defenseswill require additional individual inquiries to determinewhether specific class members' claims are time-barred.The prevalence of individualized inquiries, Ford argues,defeats the predominance requirement of Federal Rule23(b)(3).Motion to AmendDuring the briefing of the renewed class certificationmotion, Plaintiffs objected to Ford's argument predicatedon the factual contention that the express warranty issuedwith every new E-350 van limited the duration of anyimplied warranty. Plaintiffs argued that this line of impliedwarranty defense was foreclosed, because Fordfailed to raise it as an affirmative defense in its Answerto the Complaint, or in any of the summary judgmentmotions. (Pls.' Reply Br. at 13). In response, Ford movedto amend its Answer to include this affirmative defense,which Plaintiffs oppose on the ground of waiver.Ford now seeks to include the following "durationallimitation" implied warranty affirmative defense to itsAnswer:All of the vehicles in the purportedclasses were sold to their initial purchaserwith an express warranty provided byFord that [*12] validly limited the durationof the implied warranty of merchantabilityto the period of the express warranty,i.e., 3 years or 36,000 miles, whichevercomes first. Accordingly, the claimsof Plaintiffs or some members of the purportedclasses are barred because theynever suffered a legally cognizable injury,damages, and/or loss within 3 years or36,000 miles of the initial purchase of thevehicle.(Doc. No. 393, Ex. A). Ford contends that this amendmentis warranted, because the substance of the proposedaffirmative defense appeared in Ford's Answer as a responseto an allegation in Plaintiffs' Class Action Complaint.Furthermore, Ford points out that it invoked thisdefense in its original motion to dismiss before JudgeAckerman, and again in its opposition to Plaintiffs' renewedclass certification motion. In light of these uses ofthe defense, Ford contends that it would not prejudicePlaintiffs to allow Ford to redesignate the defense as anaffirmative defense.Plaintiffs respond that allowing the affirmative defensenearly three years after Ford's Answer, and wellafter the close of discovery and summary judgment mo-
2012 U.S. Dist. LEXIS 13887, *Page 5tions, would be prejudicial. Plaintiffs contend that Fordabandoned [*13] this "durational limitation" impliedwarranty defense after Judge Ackerman decided the motionto dismiss in September 2008, and that Ford has notshown grounds for excusing its undue delay in seekingthe amendment. As a result, Plaintiffs state that they didnot explore the factual issues pertinent to this "durationallimitation" defense in discovery. Plaintiffs also argue thatFord's proposed amendment would be futile. In this regard,Plaintiffs note that Judge Ackerman rejected Ford'sdurational limitation argument at the motion to dismissstage, and claim that Ford's disclaimers are not sufficientlyconspicuous to be enforceable under UCC § 2-316(2).The Federal Rules of Civil Procedure allow forflexibility when it comes to a party's pleadings, placinggreater emphasis on substance than technical form. FederalRule of Civil Procedure 15(a)(2) provides that leaveto amend a party's pleadings should be "freely give[n] . .. when justice so requires." Federal Rule 8(e) instructsthat "[p]leadings must be construed so as to do justice."Similarly, "[i]f a party mistakenly designates a defense acounterclaim, or a counterclaim as a defense, the courtmust, if justice requires, treat [*14] the pleading asthough it were correctly designated, and may imposeterms for doing so." Fed. R. Civ. P. 8(c)(2). The decisionregarding whether or not to grant leave to amend restswith the district court's sound discretion. "[A]ffirmativedefenses can be raised by motion, at any time (even aftertrial), if plaintiffs suffer no prejudice." Cetel v. KirwanFin. Grp., Inc., 460 F.3d 494, 506 (3d Cir. 2006). "Adistrict court may deny leave to amend a complaint if aplaintiff's delay in seeking amendment is undue, motivatedby bad faith, or prejudicial to the opposing party,"but delay alone is an insufficient ground for denyingleave to amend. Cureton v. Nat'l Collegiate AthleticAss'n, 252 F.3d 267, 272-73 (3d Cir. 2001). The Courtwill allow Ford's proposed amendment, because Plaintiffs'assertion of undue delay and prejudice is overstated,and Plaintiffs' attack on the merits of the warranty disclaimersis premature.Plaintiffs cannot claim unfair surprise at this defense,because Plaintiffs opened the door on the issue ofthe enforceability of Ford's implied warranty disclaimersin their Complaint. In fact, Paragraph 85 of the Complaintaptly anticipated Ford's "durational limitation"[*15] defense and preemptively countered that defenseby stating that any such disclaimers were unconscionableand unenforceable. That paragraph states:Any express limitation or negation ofFord's implied warranties that the E350vans were fit to accommodate and safelytransport 15 passengers, when such wasnot the case, would be unreasonable andunconscionable and, accordingly, is unenforceablepursuant to UCC § 2-316.(Consolidated Am. Class Action Compl. 85). It is undisputedthat Ford initially opposed this contention in themotion to dismiss before Judge Ackerman (Ford's MTDBr. at 31), and then subsequently denied this contentionin its Answer. (Answer 85). In ruling on the motion todismiss, Judge Ackerman addressed both Ford's "durationallimitation" defense and Plaintiffs' anticipatoryresponse that such disclaimers were unconscionable,concluding that it would be inappropriate to rule on disclaimersand unconscionability at the motion to dismissstage. MTD Opinion, 2008 U.S. Dist. LEXIS 73690, 2008WL 4126264, at *20 (D.N.J. Sept. 3, 2008). This Courtagrees that Ford's "durational limitation" defense shouldhave been affirmatively stated as an affirmative defense,see Fed. R. Civ. P. 8(c), but Plaintiffs [*16] cannotclaim unfair surprise. Nor can Plaintiff claim undue delay.It appears that neither party addressed the warrantydisclaimer or unconscionability in the summary judgmentmotions. However, when Plaintiffs objected toFord's assertion of this defense in its opposition to therenewed class certification, Ford promptly sought leaveto amend six days later. (See Doc. Nos. 392-93). 11 The Court is puzzled by Plaintiffs' suggestionthat they did not investigate Ford's awareness ofthe alleged defect and each Plaintiff's relativebargaining power and ability to detect the defect(see Pls.' Opp'n to Mot. to Amend at 2-3), becausethose factual issues are constituent parts ofPlaintiffs' claim that Ford failed to disclose the E-350 van's latent defect, and that this omission deceivedPlaintiffs. Indeed, as Plaintiffs recognizein their renewed class certification brief, theseller's awareness of the underlying defect andmisrepresentation is a necessary element formany consumer fraud statutes. (Pls.' RenewedClass Cert. Br. at 32) ("To prove 'unlawful conduct'in this case, Plaintiffs must 'prove that [defendant]knew or should have known' that the E-350 van, as designed, could not safely [*17]transport 15 passengers, and that Ford 'either affirmativelymisrepresented or omitted that factwhen marketing' the vehicle.") (citation omitted).;see also Gennari v. Weichert Co. Realtors, 148N.J. 582, 605, 691 A.2d 350 (1997) (explainingthat non-disclosure liability under the consumerfraud statute required a showing that "the defendantacted with knowledge"); Kowalsky v. Hewlett-PackardCo., 771 F. Supp. 2d 1156, 1162(N.D. Cal. 2011) (dismissing California UCL
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In re Ford Motor Co. E-350 Can Products Liability Litigation (No. II)

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