-NLS Lingle et al v. Hitachi Home Electronics (America), Inc. et al, No. 3:2008cv01746 - Document 153 (S.D. Cal. 2011)

Court Description: ORDER denying 100 Plaintiffs' Motion for Class Certification. Counsel shall contact the Magistrate Judge's chambers to schedule a follow-up case management conference within thirty days, at which time all remaining dates, including a trial date, shall be set. Signed by Judge Dana M. Sabraw on 1/3/11. (All non-registered users served via U.S. Mail Service)(lao)

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-NLS Lingle et al v. Hitachi Home Electronics (America), Inc. et al Doc. 153 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 IN RE HITACHI TELEVISION OPTICAL BLOCK CASES CASE NO. 08cv1746 DMS (NLS) ORDER DENYING PLAINTIFFS’ MOTION FOR CLASS CERTIFICATION This Document Relates To: All Actions 12 13 [Docket No. 100] 14 15 16 17 This matter comes before the Court on Plaintiffs’ motion for class certification. Defendants 18 Hitachi Home Electronic (America), Inc. (“HHEA”), Hitachi America, Ltd. (“HAL”) and Hitachi Ltd. 19 (“HL”) filed an opposition to the motion, and Plaintiffs submitted a reply. After reviewing the initial 20 briefs, the Court requested supplemental briefing from the parties on whether the application of 21 California law to the claims of the nationwide class members would satisfy the constitutional standard 22 set out in Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985). The parties submitted supplemental 23 briefs on that issue. Defendants also submitted a sur-reply, to which Plaintiffs filed a rebuttal. The 24 motion came on for hearing on December 17, 2010. Robert I. Lax appeared and argued on behalf of 25 Plaintiffs, and Seth E. Pierce appeared and argued on behalf of Defendants. Having carefully considered 26 the pleadings and arguments of counsel, the Court now denies the motion. 27 /// 28 /// -1- 08cv1746 Dockets.Justia.com 1 I. 2 BACKGROUND 3 The named Plaintiffs in this consolidated case are Darrin Lingle, Matthew Wagner, George 4 Yakoubian, Crystal Markee, Stan Gor, Jason Braswell and Karen Gilbert. Each of these Plaintiffs 5 purchased an Hitachi LCD Rear Projection Television (the “product”) from an independent retailer with 6 an alleged “defect in a major component called the “Optical Block.” (Lingle v. Hitachi Home 7 Electronics (America), Inc., et al., Case Number 08cv1746, First Am. Compl. ¶ 3.) Plaintiffs allege the 8 defect “was present upon delivery[,]” and that it “manifests itself over time, render[ing] the Televisions 9 unsuitable for their principal and intended purpose, in that it causes video and color anomalies to be 10 displayed on the screens of the Televisions, severely interfering with the program display.” (Id.) 11 Plaintiffs Lingle, Wagner and Yakoubian notified Hitachi of the problems they were having with their 12 products, and requested that Hitachi repair the products pursuant to its warranty. (Id. ¶¶ 4-6.) However, 13 Hitachi stated the products were out of warranty, and refused to make any repairs. (Id.) Plaintiffs also 14 allege Defendants Hitachi Home Electronics (America), Inc., Hitachi America, Ltd., and Hitachi Ltd. 15 knew about the defect, but failed to disclose it to the general public. (Id. ¶ 12.) 16 On September 23, 2008, Plaintiffs Lingle, Wagner and Yakoubian filed a complaint in this Court 17 on behalf of themselves and all others similarly situated alleging claims for (1) violation of California 18 Business and Professions Code § 17200, (2) violation of California Business and Professions Code § 19 17500, (3) violation of California Civil Code § 1750, (4) violations of other states’ unfair and deceptive 20 acts and practices laws, (5) violation of California Civil Code § 1792 (the “Song Beverly Consumer 21 Warranty Act”), (6) violation of 15 U.S.C. § 2301 (the “Magnuson-Moss Act”), (7) breach of express 22 warranty and (8) breach of implied warranty. These Plaintiffs filed a First Amended Complaint on 23 November 18, 2008, realleging the same claims for relief. 24 On December 12, 2008, Plaintiffs Markee and Gor filed a complaint in this Court on behalf of 25 themselves and all others similarly situated alleging the same claims as Plaintiffs Lingle, Wagner and 26 Yakoubian, with the exception of the breach of implied warranty claim. On August 24, 2010, Plaintiffs 27 Braswell and Gilbert filed a complaint in this Court on behalf of themselves and all other similarly 28 /// -2- 08cv1746 1 situated alleging the same claims as Plaintiffs Lingle, Wagner and Yakoubian. All three cases have been 2 consolidated before this Court. 3 II. 4 DISCUSSION 5 Plaintiffs move to certify a class “consisting of all persons who purchased, in the United States, 6 a Hitachi LCD Rear Projection Television” of certain make and model. (Mem. of P. & A. in Supp. of 7 Mot. at 1.) Plaintiffs also seek to certify a subclass “for all those pursuing claims under California’s 8 Song-Beverly Consumer Warranty Act consisting of all persons who purchased a Television in 9 California[.]” (Id.) Plaintiffs assert the proposed classes satisfy the requirements of Federal Rule of 10 Civil Procedure 23(a) and 23(b)(3). Defendants question whether Plaintiffs’ counsel is adequate to 11 represent the class, but their primary argument is that Plaintiffs have failed to satisfy the requirements 12 of Rule 23(b)(3). 13 A. Legal Standard 14 Federal Rule of Civil Procedure 23(a) states: 15 One or more members of a class may sue or be sued as representative parties on behalf of all members only if: 16 (1) the class is so numerous that joinder of all members is impracticable; 17 (2) there are questions of law or fact common to the class; 18 19 (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and 20 (4) the representative parties will fairly and adequately protect the interest of the class. 21 Fed. R. Civ. P. 23(a). 22 A showing that these requirements are met, however, does not warrant class certification. 23 Plaintiff must also show that one of the requirements of Rule 23(b) is met. Here, Plaintiffs rely on Rule 24 23(b)(3), which requires the court to find: 25 26 27 28 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. The matters pertinent to these findings include: (A) the class members’ interest in individually controlling the prosecution or defense of separate actions; -3- 08cv1746 1 (B) the extent and nature of any litigation concerning the controversy already begun by or against class members; 2 3 (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and 4 (D) the likely difficulties in managing a class action. 5 Fed. R. Civ. P. 23(b)(3). 6 The party seeking certification must provide facts sufficient to satisfy the requirements of Rule 7 23(a) and (b). Doninger v. Pacific Northwest Bell, Inc., 564 F.2d 1304, 1308-09 (9th Cir. 1977). In 8 turn, the district court must conduct a rigorous analysis to determine that the prerequisites of Rule 23 9 have been met. Gen. Tel. Co. v. Falcon, 457 U.S. 147, 161 (1982). If a court is not fully satisfied, 10 certification should be refused. Id. It is a well-recognized precept that “‘the class determination 11 generally involves considerations that are enmeshed in the factual and legal issues comprising the 12 plaintiff’s cause of action.’” Id. at 160 (citation omitted). However, “[a]lthough some inquiry into the 13 substance of a case may be necessary to ascertain satisfaction of the commonality and typicality 14 requirements of Rule 23(a), it is improper to advance a decision on the merits to the class certification 15 stage.” Moore v. Hughes Helicopters, Inc., 708 F.2d 475, 480 (9th Cir. 1983) (citation omitted); see 16 also Nelson v. United States Steel Corp., 709 F.2d 675, 679-80 (11th Cir. 1983) (plaintiffs’ burden 17 “entails more than the simple assertion of [commonality and typicality] but less than a prima facie 18 showing of liability”) (citation omitted). Rather, the court’s review of the merits should be limited to 19 those aspects relevant to making the certification decision on an informed basis. See Fed. R. Civ. P. 23 20 advisory committee notes. 21 B. The Proposed Nationwide Class 22 The focus of the parties’ briefs is Plaintiffs’ proposed nationwide class of consumers that 23 purchased one of Defendants’ allegedly defective products. As explained below, this class satisfies the 24 requirements of Rule 23(a). However, it does not satisfy the requirements of Rule 23(b)(3). Rule 23(a) 25 1. 26 As set out above, Rule 23(a) sets out four requirements for class certification: (1) Numerosity, 27 (2) commonality, (3) typicality and (4) adequacy of representation. These elements are addressed 28 below. -4- 08cv1746 1 /// 2 3 a. Numerosity 4 Rule 23(a)(1) requires the class to be “so numerous that joinder of all members is impracticable.” 5 Fed. R. Civ. P. 23(a)(1); Staton v. Boeing Co., 327 F.3d 938, 953 (9th Cir. 2003). The plaintiff need not 6 state the exact number of potential class members; nor is a specific minimum number required. Arnold 7 v. United Artists Theatre Circuit, Inc., 158 F.R.D. 439, 448 (N.D. Cal. 1994). Rather, whether joinder 8 is impracticable depends on the facts and circumstances of each case. Id.; see Johnson by Johnson v. 9 Thompson, 971 F.2d 1487, 1498 (10th Cir. 1992) (whether the class is so numerous is a fact-specific 10 inquiry; district court is granted wide latitude in making this determination). 11 Here, Plaintiffs state that Defendants sold more than 100,000 of the allegedly defective products. 12 A class of this size satisfies the numerosity requirement. Accordingly, Plaintiffs have satisfied the first 13 requirement of Rule 23(a). 14 b. Commonality 15 The second element of Rule 23(a) requires that “there are questions of law or fact common to 16 the class.” Fed. R. Civ. P. 23(a)(2). This requirement “focuses on the relationship of common facts and 17 legal issues among class members.” Dukes v. Wal-Mart, Inc., 509 F.3d 1168, 1177 (9th Cir. 2007). This 18 rule has been construed permissively. Indeed, the showing to satisfy commonality is “minimal.” 19 Hanlon v. Chrysler Corp., 150 F.3d 1011, 1020 (9th Cir. 1998). 20 In this case, Plaintiffs provide a long list of “common questions” to support their argument that 21 the commonality requirement is satisfied. (See Mem. of P. & A. in Supp. of Mot. at 10.) These 22 questions raise legal and factual issues, and they are sufficient to meet the “minimal” standard of 23 commonality. 24 c. Typicality 25 The next requirement of Rule 23(a) is typicality. “Although the ‘commonality and typicality 26 requirements of Rule 23(a) tend to merge,’ each factor serves a discrete purpose. Commonality 27 examines the relationship of facts and legal issues common to class members, while typicality focuses 28 on the relationship of facts and issues between the class and its representatives.” Dukes, 509 F.3d at -5- 08cv1746 1 1184 n.12 (citations omitted). The rule sets forth a permissive standard: “representative claims are 2 ‘typical’ if they are reasonably co-extensive with those of absent class members; they need not be 3 substantially identical.” Hanlon, 150 F.3d at 1020. “The test of typicality is whether other members 4 have the same or similar injury, whether the action is based on conduct which is not unique to the named 5 plaintiffs, and whether other class members have been injured by the same course of conduct.” Hanon 6 v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992) (citation and internal quotation marks 7 omitted). 8 9 10 Here, Plaintiffs’ claims are typical of the class. Each purchased a product from Defendants that allegedly suffered from the same defect. Accordingly, Plaintiffs have satisfied the typicality requirement. 11 d. Adequacy of Representation 12 The final requirement of Rule 23(a) is adequacy. Rule 23(a)(4) requires a showing that “the 13 representative parties will fairly and adequately protect the interests of the class.” Fed. R. Civ. P. 14 23(a)(4). This requirement is grounded in constitutional due process concerns; “absent class members 15 must be afforded adequate representation before entry of judgment which binds them.” Hanlon, 150 16 F.3d at 1020 (citing Hansberry v. Lee, 311 U.S. 32, 42-43 (1940)). In reviewing this issue, courts must 17 resolve two questions: “(1) do the named plaintiffs and their counsel have any conflicts of interest with 18 other class members, and (2) will the named plaintiffs and their counsel prosecute the action vigorously 19 on behalf of the class?” Id. (citing Lerwill v. Inflight Motion Pictures, Inc., 582 F.2d 507, 512 (9th Cir. 20 1978)). Both the named plaintiffs and their counsel must have sufficient “zeal and competence” to 21 protect the interests of the rest of the class. Fendler v. Westgate-California Corp., 527 F.2d 1168, 1170 22 (9th Cir. 1975). 23 In this case, Plaintiffs have demonstrated the absence of any conflict between themselves and 24 their counsel and the members of the class. Plaintiffs have also demonstrated that they and their counsel 25 will vigorously prosecute the case on behalf of the class. Accordingly, Plaintiffs have satisfied Rule 26 23(a)(4). 27 2. Rule 23(b) 28 -6- 08cv1746 1 The next issue is whether Plaintiffs have shown that at least one of the requirements of Rule 2 23(b) is met. Amchem Products, Inc. v. Windsor, 521 U.S. 591, 614-15 (1997). In this case, Plaintiffs 3 assert they have met the requirements of Rule 23(b)(3). 4 Certification under Rule 23(b)(3) is proper “whenever the actual interests of the parties can be 5 served best by settling their differences in a single action.” Hanlon, 150 F.3d at 1022 (internal 6 quotations omitted). Rule 23(b)(3) calls for two separate inquiries: (1) do issues common to the class 7 “predominate” over issues unique to individual class members, and (2) is the proposed class action 8 “superior” to the other methods available for adjudicating the controversy. Fed. R. Civ. P. 23(b)(3). 9 In adding these requirements to the qualifications for class certification, “the Advisory Committee 10 sought to cover cases ‘in which a class action would achieve economies of time, effort, and expense, 11 and promote ... uniformity of decisions as to persons similarly situated, without sacrificing procedural 12 fairness or bringing about other undesirable results.’” Amchem, 521 U.S. at 615 (quoting Fed. R. Civ. 13 P. 23(b)(3)(advisory committee notes)). 14 A “central concern of the Rule 23(b)(3) predominance test is whether ‘adjudication of common 15 issues will help achieve judicial economy.’” Vinole v. Countrywide Home Loans, Inc., 571 F.3d 935, 16 944 (9th Cir. 2009) (quoting Zinser v. Accufix Research Institute, Inc., 253 F.3d 1180, 1189 (9th Cir. 17 2001)). Thus, courts must determine whether common issues constitute such a significant aspect of the 18 action that “there is a clear justification for handling the dispute on a representative rather than on an 19 individual basis.” 7A Charles Alan Wright, et al., Federal Practice and Procedure § 1778 (3d ed. 20 2005). To satisfy the predominance inquiry, it is not enough to establish that common questions of law 21 or fact exist, as it is under Rule 23(a)(2)’s commonality requirement. The predominance inquiry under 22 Rule 23(b) is more rigorous, Amchem, 521 U.S. at 624, as it “tests whether proposed classes are 23 sufficiently cohesive to warrant adjudication by representation.” Id. at 623. 24 Here, Plaintiffs argue that common issues of fact and law predominate over any individual 25 issues. Specifically, Plaintiffs argue their claims are based on the same design defect and Defendants’ 26 misrepresentation and concealment of that defect. Plaintiffs also contend that California law should 27 apply to the claims of all class members, therefore the legal issues for each class member will be the 28 -7- 08cv1746 1 same. Defendants dispute that common issues of fact predominate. They also argue that application 2 of California law to the nationwide class proposed here would violate due process. 3 In Shutts, the Supreme Court resolved the issue of whether application of a forum state’s 4 substantive law to the claims of a nationwide class violated due process. 472 U.S. 797. The class in 5 Shutts consisted of approximately 33,000 members that possessed royalty rights in land leased to the 6 defendant for the production or purchase of natural gas. Id. at 799, 801. The land at issue was located 7 in eleven different States, and the class members “reside[d] in all 50 States, the District of Columbia, 8 and several foreign countries.” Id. The plaintiffs alleged the defendant had withheld interest on certain 9 royalty payments, and brought a class action in Kansas state court to recover those amounts. Id. Over 10 defendant’s objection, the state court certified the class, and the case proceeded to trial before the court. 11 Id. at 801. Applying Kansas law, the court found defendant liable for interest on the suspended royalties 12 to all class members. Id. The defendant appealed the judgment to the Supreme Court of Kansas, 13 arguing that “Kansas courts could not apply Kansas law to every claim in the dispute[,]” but the court 14 rejected that argument. Id. at 802-03. It found “that generally the law of the forum controlled all claims 15 unless ‘compelling reasons’ existed to apply a different law. The court found no compelling reasons, 16 and noted that ‘[t]he plaintiff class members have indicated their desire to have this action determined 17 under the laws of Kansas.’” Id. at 803. The Supreme Court granted certiorari to decide whether 18 application of Kansas substantive law to the claims of all class members “violated the constitutional 19 limitations on choice of law mandated by the Due Process Clause of the Fourteenth Amendment and 20 the Full Faith and Credit Clause of Article IV, § 1.” Id. at 816. 21 In resolving this issue, the Court first “determine[d] whether Kansas law conflicts in any material 22 way with any other law which could apply.” Id. After finding such conflicts, the Court then considered 23 whether Kansas had “a ‘significant contact or significant aggregation of contacts’ to the claims asserted 24 by each member of the plaintiff class, contacts ‘creating state interests,’ in order to ensure that the 25 choice of Kansas law is not arbitrary or unfair.” Id. at 821-22 (quoting Allstate Ins. Co. v. Hague, 449 26 U.S. 301, 312-13 (1981)). The Court found such contacts did not exist, and therefore held “that 27 application of Kansas law to every claim in this case is sufficiently arbitrary and unfair as to exceed 28 constitutional limits.” Id. at 822. -8- 08cv1746 1 a. Is There A Material Conflict Between California Law and the Laws of the Other States? 2 3 Following the analysis in Shutts, Defendants argue that California’s consumer protection laws 4 conflict with the laws of other states in several material respects. In support of this argument, 5 Defendants cite case law that supports their argument. See In re Grand Theft Auto Video Game 6 Consumer Litig., 251 F.R.D. 139, 147 (S.D.N.Y. 2008) (stating differences in state consumer fraud laws 7 encompass issues of reliance, scienter, burden of proof, availability of class actions and notice); In re 8 Prempro, 230 F.R.D. 555, 564 (E.D. Ark. 2005) (“Both consumer fraud and unfair competition laws of 9 the states differ with regard to the defendant’s state of mind, type of prohibited conduct, proof of injury- 10 in-fact, available remedies, and reliance, just to name a few differences.”) (footnote omitted). Other 11 cases are also in accord. See In re St. Jude Medical, Inc., 425 F.3d 1116, 1120 (8th Cir. 2005) (relying 12 on Seventh Circuit’s conclusion that state consumer protection laws “vary considerably”); In re 13 Bridgestone/Firestone, Inc., 288 F.3d 1012, 1018 (7th Cir. 2002) (“State consumer-protection laws vary 14 considerably, and courts must respect these differences rather than apply one state’s law to sales in other 15 states with different rules.”); Siegel v. Shell Oil Co., 256 F.R.D. 580, 584-85 (N.D. Ill. 2008) (listing 16 examples of differences in state consumer protection laws). These cases support a finding that there are 17 material conflicts between California’s consumer protection laws and the consumer protection laws of 18 the other forty-nine states. 19 The case law also supports a finding that there are material conflicts between California’s 20 warranty laws and the warranty laws of the other states. See In re Gen. Motors Corp. Dex-Cool 21 Products Liability Litig., 241 F.R.D. 305, 319-21 (S.D. Ill. 2007). In Dex-Cool, the court’s research 22 revealed that there were “at least three distinct approaches to the question of reliance as an element of 23 a claim for breach of express warranty.” Id. at 319. The majority approach holds that “reliance is not 24 an element of an express warranty claim.” Id. However, “a significant number of other states ... require 25 specific reliance on a seller’s statements as a condition of recovery ....” Id. at 320. Finally, “a small 26 minority of the states ... follow a third approach to reliance, holding that a seller’s affirmations and 27 promises relating to goods create a rebuttal presumption of reliance by a buyer.” Id. The states also 28 take differing views on whether privity is required for warranty claims. See Grand Theft Auto, 251 -9- 08cv1746 1 F.R.D. at 161 (stating eighteen states require privity for breach of warranty claims while other states do 2 not); In re Ford Motor Co. Ignition Switch Products Liability Litig., 174 F.R.D. 332, 346 (D.N.J. 1997) 3 (same). Thus, there are material conflicts between California warranty law and the warranty law of the 4 other forty-nine states. 5 b. Does California Have Sufficient Contacts to the Claims of Each Class Member? 6 Having found material conflicts between the relevant California laws and the laws of the other 7 states, the Court must now consider whether California has sufficient contacts to each class member’s 8 claims to ensure that the choice of California law “is not arbitrary or unfair.” Shutts, 472 U.S. at 821-22. 9 There is no dispute that Hitachi, Ltd. is a Japanese corporation with its principal place of 10 business in Japan. Nor is there any dispute that Hitachi Home Electronics (America), Inc. is a California 11 corporation with its principal place of business in Chula Vista, California. Plaintiffs assert that Hitachi 12 America, Ltd. has an office in California, but the evidence reflects that it is a New York corporation, 13 and Defendants assert its principal place of business is in New York. 14 The exact location of the design and development of the products at issue is unclear. The best 15 description of the design and development process is found in the Declaration of Naoyuki Ogura, the 16 chief optical engineer for all Hitachi-brand LCD rear projection television designs from 1987 through 17 2009, who states: “The development of a product like the Hitachi-brand LCD RPTV is a team effort, 18 that draws upon multiple resources world-wide, including design engineers, factory personnel, and 19 component suppliers. But the Hitachi-brand LCD RPTVs, and particularly the optical engines, were 20 primarily developed/designed in Japan.” (Decl. of Naoyuki Ogura in Supp. of Opp’n to Mot. ¶ 7.) 21 Plaintiffs make much of the fact that employees of Hitachi Home Electronics (America), Inc. 22 were involved in the manufacture of the products at issue. However, the manufacturing process actually 23 occurred at a plant in Mexico. 24 There is no apparent dispute that Hitachi America, Ltd. sold and distributed the products to 25 independent retailers throughout the country (e.g., Sears and Circuit City), but it is unclear whether that 26 distribution process had a central location, and if so, where that center was located. 27 Plaintiffs assert that Defendants’ marketing efforts for the products at issue originated at Hitachi 28 Home Electronics (America), Inc.’s headquarters in Chula Vista. William Whalen, an employee of - 10 - 08cv1746 1 Hitachi America, Ltd., admits that he “was responsible for coordinating the marketing of the Hitachi- 2 brand LCD Rear Projection Televisions (‘LCD RPTVs’) at issue in this case.” (Decl. of William 3 Whalen in Supp. of Opp’n to Mot. ¶ 1.) However, he states: 4 5 6 HAL did not directly, actively market the Hitachi-brand LCD RPTVs for sale to potential individual purchasers. HAL’s primary strategy, at the time, was to encourage the retail dealers that purchased the televisions for re-sale to advertise and promote the products directly to their customers, thus avoiding the necessity of having HAL orchestrate and bear the costs of a comprehensive national marketing campaign to bring broad consumer attention to Hitachi-brand LCD RPTVs on behalf of such retail dealers. 7 8 (Id. ¶ 4.) 9 The consumers then purchased the products from the independent retailers. “HAL did not retail 10 Hitachi-brand LCD RPTVs directly to individual purchasers/consumers.” (Id. ¶ 3.) 11 The products came with an operating guide, which included a phone number for a service 12 hotline. (Decl. of Joseph J.M. Lange in Supp. of Supp. Br. (“Supp. Lange Decl.”), Ex. 2.) “Affina, 13 a nationally recognized provider of third-party (or outplacement) customer service support, answers all 14 calls to the” hotline. (Decl. of Theresa Omar in Supp. of Opp’n to Mot. (“Omar Decl.”) ¶ 3.) “Affina 15 customer service operators and supervisors field all of these calls from a call center located in Illinois.” 16 (Id.) The operating guide explained that if the consumer required service, they should call the hotline 17 and an operator would direct them to the nearest Hitachi Authorized Service Facility (“ASF”). (Supp. 18 Lange Decl., Ex. 2.) The guide also states: “Should you have any questions regarding warranty, service, 19 operation, or technical assistance, please contact: Hitachi America, LTD. Home Electronics Division 20 900 Hitachi Way Chula Vista, CA 91914-3556.” (Id.) If the consumer wished to register their product, 21 they were directed to do so on-line or to send their warranty card to Hitachi America Ltd., Home 22 Electronics Division Attn: Warranty Department 900 Hitachi Way Chula Vista, CA 91914-9943. (Supp. 23 Lange Decl., Ex. 4.) 24 In the event the customer had an issue or problem with the product, they had the option of 25 contacting the retailer, calling the hotline, or contacting a local service provider of their own choosing. 26 (Omar Decl. ¶ 2.) If the customer contacted the hotline, the operator would attempt to resolve the 27 problem over the phone. (Id.) If the operator “does not know the answer to the question posed, the 28 question is escalated to a technical support representative at HHEA or HAL (depending on the - 11 - 08cv1746 1 timeframe) located in the San Diego area for further handling.” (Id. ¶ 4.) Teresa Omar, the former 2 Manager of Customer Service at Hitachi Home Electronics (America), Inc., explains: 3 4 Affina strives to answer all technical questions posed. While the rate of technical questions that they cannot handle directly varies from day to day, week to week, and month to month, overall far less than 1% of all service inquiries to [the hotline] are escalated to corporate personnel in Chula Vista, California. 5 (Id. ¶ 5.) If the operator is unable to resolve the issue over the phone, he or she would refer the customer 6 to “an independent, local, authorized servicer[ ] (i.e., Authorized Service Facilities or ASF) for further 7 assistance.” (Id.) 8 If the product was under warranty, the ASF “performs the service and then bills HAL or HHEA, 9 as appropriate, for the cost of labor and replacement parts and, in cases requiring the servicer to drive 10 more than 25 miles to complete the service, mileage reimbursement.” (Id. ¶ 6.) If the product was out 11 of warranty, the operators “have discretion, based on the specific facts of the inquiry, to make 12 concessions to the customer, up to and including free, in-home repair.” (Id. ¶ 7.) If Affina 13 representatives were unable to resolve the issue to the customer’s satisfaction, they would then forward 14 the inquiry to Ms. Omar in California. (Id.) 15 Overall, this process has some contacts with the State of California. Defendants Hitachi Home 16 Electronics (America), Inc. and Hitachi America, Ltd. both have a corporate presence in the State. 17 However, the corporate presence of these Defendants does not amount to a contact with the claims of 18 the individual class members. Unlike the contacts analysis for purposes of personal jurisdiction, which 19 measures the defendant’s contacts with the forum state, the contacts analysis here measures the forum 20 state’s contacts with the individual claims. Thus, Defendants’ corporate presence in the State of 21 California does not constitute a significant contact for purposes of the due process analysis. 22 That these Defendants have employees in the State of California is also insufficient to satisfy 23 due process. Although Hitachi employees may have lived in California and worked in the Chula Vista 24 office, the actual manufacturing of the product occurred at the Mexican assembly plant. Furthermore, 25 Mr. Whalen’s location in the Chula Vista office is of little significance in this analysis as Hitachi did 26 not market its products directly to consumers. Rather, Hitachi left the marketing to the individual 27 retailers. Thus, any representations about the quality of the products would have originated with the 28 individual retailers, not Hitachi employees in California. - 12 - 08cv1746 1 Plaintiffs’ strongest argument rests on the contacts between the State of California and the class 2 members’ warranty claims. Here, the consumers would have submitted their warranty registration cards 3 to the Chula Vista office, and there is evidence that Hitachi “used to maintain” a staff of employees in 4 the Chula Vista office to handle technical inquiries from Affina operators. (Id. ¶ 4.) However, the 5 evidence reflects that those employees were only involved in 1% of all warranty inquiries. (Id. ¶ 9.) 6 The other 99% of warranty inquiries were handled either by Affina operators in Illinois or an ASF in 7 the consumer’s local area. For these claims, there would have been no contact with the State of 8 California other than submission of the warranty registration card to the Chula Vista office. The Court 9 finds this contact, and the other limited contacts discussed above, do not amount to “significant 10 contacts” sufficient to allow application of California law to the claims of the nationwide class. 11 In making this finding, the Court recognizes that other courts have applied California law to 12 claims of nationwide classes. See Chavez v. Blue Sky Natural Beverage Co., 268 F.R.D. 365 (N.D. Cal. 13 2010); Keilholtz v. Lennox Hearth Products Inc., 268 F.R.D. 330 (N.D. Cal. 2010); Mazza v. Am. Honda 14 Motor Co., 254 F.R.D. 610 (C.D. Cal. 2008); Parkinson v. Hyundai Motor America, 258 F.R.D. 580 15 (C.D. Cal. 2008); Clothesrigger, Inc. v. GTE Corp., 191 Cal. App. 3d 605 (1987). In each of those 16 cases, however, the claims had more significant contacts with the State of California. For instance, in 17 Chavez, the alleged misrepresentations, which were on the actual products, originated in the State of 18 California. 268 F.R.D. at 379. Similarly, in Mazza, the defendants’ design and marketing of its 19 products occurred in California. 254 F.R.D. at 620.1 And, in Keilholtz, a majority of the products were 20 at least partially manufactured in California. 268 F.R.D. at 340. 21 Here, Plaintiffs allege the misrepresentations occurred in California, but they fail to submit any 22 evidence to support this allegation. Rather, the evidence reflects that Defendants did not market their 23 products directly to consumers, but left that task to the individual retailers. Plaintiffs also allege that 24 the products were designed in California, but again the evidence reflects that the products were 25 primarily developed and designed in Japan. Finally, the products at issue here were manufactured 26 27 28 1 The Mazza court also noted “that the advertising agency hired by Honda to create the print, radio, and television advertising for the Acura RL and the CMBS System is based in Santa Monica, California, and that the agency retained for internet-based advertising is based in Culver City, California.” Id. - 13 - 08cv1746 1 entirely in Mexico, not California. In light of these facts, California does not have “a ‘significant 2 contact or significant aggregation of contacts’ to the claims asserted by each member of the plaintiff 3 class, contacts ‘creating state interests,’” to ensure that application of California law to all claims is “not 4 arbitrary or 5 /// 6 unfair.” Shutts, 472 U.S. at 821-22 (quoting Allstate, 449 U.S. at 312-13). Accordingly, the Court 7 declines to apply California law to the nationwide class. 8 Absent application of California law, Plaintiffs urge the Court to create subclasses based on 9 states with identical or similar legal standards. As with the proposed nationwide class, Plaintiffs “bear 10 the burden of establishing appropriate subclasses and demonstrating that each subclass meets the Rule 11 23 requirements.” In re Telectronics Pacing Systems, Inc., 168 F.R.D. 203, 221 (S.D. Ohio 1996) 12 (citations omitted). Plaintiffs’ attempts here do not meet that burden. Specifically, Plaintiffs fail to 13 identify which states have identical or similar legal standards, and how many subclasses would be 14 required for the consumer protection act claims and the warranty claims. They also fail to identify the 15 representatives for each subclass, how many members would be included in each subclass, and how each 16 of the other requirements for certification would be met by each subclass. This “cavalier” approach to 17 class certification is insufficient. See In re Paxil Litig., 212 F.R.D. 539, 545-48 (C.D. Cal. 2003) 18 (denying motion for class certification where plaintiffs failed to provide manageable class definition and 19 manageable trial plan). Plaintiffs cannot postpone their burden to meet the class certification 20 requirements “and expect this Court to certify an amorphous, undefined class.” Telectronics, 168 F.R.D. 21 at 221. Rather, Plaintiffs “must come forward with the exact definition of each subclass, its 22 representatives, and the reasons each subclass meets the prerequisites of Rule 23(a) and (b).” Id. Unless 23 and until Plaintiffs do so, the Court declines to certify any subclasses in this case.2 24 IV. 25 CONCLUSION 26 Plaintiffs move to certify “a class consisting of all persons who purchased, in the United States, 27 a Hitachi LCD Rear Projection Television ....” (Mem. of P. & A. in Supp. of Mot. at 1.) Plaintiffs also 28 2 This includes Plaintiffs’ request to certify a subclass for the Song Beverly claim. - 14 - 08cv1746 1 move to certify “a subclass for all those pursuing claims under California’s Song-Beverly Consumer 2 Warranty Act consisting of all persons who purchased a Television in California[.]” (Id.) For the 3 reasons set out above, the Court finds Plaintiffs have failed to satisfy the predominance requirement for 4 their proposed nationwide class. Plaintiffs have also failed to establish any of the requirements for 5 certification of subclasses as an alternative to the nationwide class, or a subclass based on the Song 6 Beverly claim. Accordingly, Plaintiffs’ motion for class certification is denied in its entirety. 7 8 9 10 Counsel shall contact the Magistrate Judge’s chambers to schedule a follow-up case management conference within thirty days, at which time all remaining dates, including a trial date, shall be set. IT IS SO ORDERED. DATED: January 3, 2011 11 12 HON. DANA M. SABRAW United States District Judge 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 15 - 08cv1746

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