A team of Ballard Spahr attorneys was successful in persuading a federal judge in Michigan to reject class certification in a consumer suit filed on behalf of millions of customers who purchased cars equipped with OnStar telematics. The consumers asserted claims against four auto manufacturers alleging a breach of their vehicle warranties and violations of various states’ consumer protection statutes.
Litigators Neal Walters and Mariah Murphy argued that the case didn’t qualify as a class action because each class member’s claim would hinge on his or her own individual story. Building on the latest decisions from the U.S. Supreme Court, the team pointed to reasons the case fell short of the strict court rules for winning certification of such a massive class.
Mr. Walters, a partner, and Ms. Murphy, an associate, represent Subaru of America in the multidistrict case. Also named as defendants were OnStar, General Motors, Honda, and Volkswagen. The suits alleged that consumers were not adequately informed that OnStar’s analog telecommunications equipment would become obsolete in the future, after the Federal Communications Commission (FCC) allowed wireless carriers to drop analog services.
In their brief for Subaru of America, Mr. Walters and Ms. Murphy said testimony from the expert witnesses—and common sense—revealed the holes in the plaintiffs’ arguments.
Litigating the case as a class action would be impossible and unmanageable, they argued, because it could not be shown that members of the consumer class acted in the same way with respect to their purchase of cars with OnStar equipment. The evidence showed that consumers’ interest in OnStar, and its impact on their purchasing decisions, as well as their knowledge about the FCC’s rule change, varied considerably. Such variations, the Ballard attorneys argued, would require individualized inquiries among the many putative class members.
U.S. District Judge Sean F. Cox sided with the defense lawyers and declared that the proposed class is not subject to common proofs on a class-wide basis, and that the proposed class members simply don’t share the same legal and factual issues.
Judge Cox adopted many of the defense arguments in a 67-page opinion that denied class certification of all proposed claims against Subaru of America, OnStar, Honda, and Volkswagen. The decision did not address General Motors because all claims against it were stayed when the company filed for bankruptcy.