UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA. Case No. 0:14-CV-62567

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1 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA Case No. 0:14-CV TRACY SANBORN and LOUIS LUCREZIA, on behalf of themselves and all others similarly situated, v. Plaintiffs, NISSAN NORTH AMERICA INC., Defendant. MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFFS MOTION FOR CLASS CERTIFICATION 0

2 TABLE OF CONTENTS I. Introduction... 1 II. Summary of Facts... 2 A. Nissan Sold Class Vehicles With Dashboards That Cannot Withstand Florida s Heat and Humidity B. Nissan Failed To Properly Formulate or Test The Dashboard Material Before Installing It In Class Vehicles C. Nissan Failed To Disclose The Melting Dashboard Defect To Class Members... 6 D. Nissan Continues To Conceal The Melting Dashboard Defect From Its Consumers E. Florida Consumers Have Suffered Damages As A Result Of Nissan s Deception, While Nissan Has Unfairly Profited III. Argument... 8 A. The Named Plaintiffs Have Standing B. The Proposed Class Is Adequately Defined and Ascertainable C. The Proposed Class Satisfies Rule 23(a) Rule 23(a)(1) - Numerosity Rule 23(a)(2) - Commonality Rule 23(a)(3) Typicality Rule 23(a)(4) Adequacy D. The Proposed Class Satisfies Rule 23(b)(3) Rule 23(b)(3) - Predominance a. The Elements of Plaintiffs FDUTPA Claim Will Be Proven Using Generalized Evidence. 13 i. Unfair or Deceptive Conduct ii. Causation iii. Damages b. The Elements of Plaintiffs Unjust Enrichment Claim Will Be Proven Using Generalized Evidence i. A Benefit Conferred on Nissan i

3 ii. Appreciation of the Benefit iii. Retention of the Benefit Under Inequitable Circumstances Rule 23(b)(3) - Superiority IV. Conclusion ii

4 TABLE OF AUTHORITIES Cases Amgen Inc. v. Connecticut Ret. Plans & Trust Funds, 133 S. Ct (2013) Brown v. SCI Funeral Servs. of Florida, Inc., 212 F.R.D. 602 (S.D. Fla. 2003) Busby v. JRHBW Realty, Inc., 513 F.3d 1314 (11th Cir. 2008) Bussey v. Macon Cty. Greyhound Park, Inc., 562 F. App'x 782 (11th Cir. 2014)... 9 Carriuolo v. Gen. Motors LLC, No CIV, 2014 WL (S.D. Fla. Dec. 11, 2014)... 13, 16 Collins v. DaimlerChrysler Corp., 894 So. 2d 988 (Fla. Dist. Ct. App. 2004) Compare Karhu v. Vital Pharm., Inc., No CIV, 2014 WL (S.D. Fla. Mar. 3, 2014)... 9 County of Monroe, Florida v. Priceline.com, Inc., 265 F.R.D. 659 (S.D. Fla. 2010) Davis v. Powertel, Inc., 776 So. 2d 971 (Fla. Dist. Ct. App. 2000) Erica P. John Fund, Inc. v. Halliburton Co., 131 S.Ct (2011) Fitzpatrick v. Gen. Mills, Inc., 635 F.3d 1279 (11th Cir. 2011)... 14, 15 Gavron v. Weather Shield Mfg., Inc., 819 F. Supp. 2d 1297 (S.D. Fla 2011) Hope v. Nissan N. Am., Inc., 353 S.W.3d 68 (Mo. Ct. App. 2011)... 6 In re Checking Account Overdraft Litig., 275 F.R.D. 666 (S.D. Fla. 2011)... 11, 15, 16, 17 In re ConAgra Foods, Inc., 2015 WL (C.D. Cal. Feb. 23, 2015) In re Terazosin Hydrochloride, 220 F.R.D. 672 (S.D. Fla. 2004) Jackson-Jester v. Aziz, 48 So. 3d 88 (Fla. Dist. Ct. App. 2010) James D. Hinson Elec. Contracting Co. v. BellSouth Telecommunications, Inc., 275 F.R.D. 638 (M.D. Fla. 2011) Khoday v. Symantec Corp., 2015 WL (D. Minn. March 19, 2015) Klay v. Humana, Inc., 382 F.3d 1241 (11th Cir. 2004) Kopel v. Kopel, 117 So. 3d 1147 (Fla. Dist. Ct. App. 2013) Little v. T Mobile USA, Inc., 691 F.3d 1302 (11th Cir. 2012)... 8 Nivia v. Nationstar Mortgage, LLC, No. 13-CIV-24080, 2014 WL (S.D. Fla. Aug. 21, 2014) 14 PNR, Inc. v. Beacon Prop. Mgmt., Inc., 842 So. 2d 773 (Fla. 2003) Prado-Steiman ex rel. Prado v. Bush, 221 F.3d 1266 (11th Cir. 2000) Randolph v. J.M. Smucker Co., 303 F.R.D. 679 (S.D. Fla. 2014)... 8, 9, 11 iii

5 Rothstein v. DaimlerChrysler Corp., No. 8:05-CV-1126T30-MSS, 2005 WL (M.D. Fla. Nov. 18, 2005) Rutstein v. Avis Rent-A-Car Sys., Inc., 211 F.3d 1228 (11th Cir. 2000) Sanchez-Knutson v. Ford Motor Co., 310 F.R.D. 529 (S.D. Fla. 2015)... passim Veal v. Crown Auto Dealerships, Inc., 236 F.R.D. 572 (M.D. Fla. 2006)... 8 Vega v. T-Mobile USA, Inc., 564 F.3d 1256 (11th Cir. 2009)... 8, 10, 17 Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551 & 2557 (2011) Williams v. Mohawk Indus., Inc., 568 F.3d 1350 (11th Cir. 2009) Wolin v. Jaguar Land Rover N. Am., LLC, 617 F.3d 1168 (9th Cir. 2010) Statutes Fla. Stat (1), Rules Fed. R. Civ. P. 23(a)(3) Fed. R. Civ. P. 23(b)(3)... 2, 12, 18 iv

6 I. INTRODUCTION Plaintiffs are owners of Nissan Altimas who, like many other Florida consumers, were sold vehicles with defective dashboards. This defect has caused an epidemic of melting dashboards in Florida, as Altima dashboards gradually degrade into a soft, gooey, shiny thing that and casts an unpredictable glare on drivers windshields that has caused at least two accidents and many other near accidents. Plaintiffs seek to hold Nissan liable for this melting dashboard defect under the Florida Deceptive and Unfair Trade Practice Act (FDUTPA) and common law of unjust enrichment for three independent reasons: (i) (ii) Nissan sold class vehicles with dashboard material that was not properly formulated and cannot withstand Florida s heat and humidity; Nissan failed to disclose the dashboard defect to its customers, dealers, or the public even though Nissan has a history of dashboard problems and should have known that its dashboard material was improperly formulated or discovered the defect through pre-release testing; and (iii) Nissan failed to disclose the dashboard defect ; instead, Nissan did nothing and publicly denied that a systemic dashboard defect existed as Altima dashboards began melting throughout Florida. These allegations are well-suited to class-wide adjudication, as they can be proven or not proven for all of members of the following proposed class: All persons who purchased or leased a 2008 or 2009 Nissan Altima vehicle from an authorized Nissan dealer in Florida prior to January 1, Each putative class member purchased a vehicle that used the same defective dashboard material found in Plaintiffs vehicles. Nissan s liability hinges on questions of fact and law that do not vary from class member to class member questions like whether Nissan sold vehicles with defective dashboards; whether Nissan knew or should have known about the dashboard defect; when Nissan discovered or should have discovered the dashboard defect; whether Nissan s conduct would be considered unfair or deceptive by an objectively reasonable consumer; and to what extent the defective dashboards affect the market value of a Nissan Altima. The evidence Plaintiffs plan to present at trial also does not vary from class member to class member; it is generalized evidence. In other words, if each class member had to proceed through individual trials, they would use the same internal Nissan documents, deposition testimony from Nissan employees, and expert testimony to prove their case. This case is similar in many ways to one that was recently certified by Judge Dimitrouleas. See Sanchez-Knutson v. Ford Motor Co., 310 F.R.D. 529 (S.D. Fla. 2015). That case concerned Ford Explorers, which were alleged to share a systemic defect that could lead to exhaust entering the 1

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8 Fig. 2: Photo of Plaintiff Sanborn s dashboard (Id., Ex. 6.) This melting dashboard phenomenon has become a major problem for Altima owners in Florida. (Zeman Decl., Ex. 7 at 2465.) (Id.; see also Ex. 8 at 1803 ).) And of course, many customers have complained directly to their dealerships, (Id., Ex. 3 at 106:3-46; see also Ex. 9 at 1680.) The melting dashboard issue has been (Id., Ex. 10 at 1927; Ex. 11 at 1768; Ex. 12 at 1807.) ).) The problem of melting dashboards is so pervasive in Florida that it has become the subject of ongoing investigative reports by NBC, ABC, and FOX news affiliates. (Id., Exs ; see also Ex. 12 at 1807 ( we are getting a lot of negative press ).) 3

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10 (Id., Ex. 7 at 2470, 2484, 2532 (capitalization altered).) The Center for Auto Safety has evaluated the issue and agrees that the melting-dashboard is a safety defect. (See id., Ex. 21 at 2053; Ex. 17.) and more have likely gone unreported. (See id., Ex. 7 at 2483, 2554.) In addition, several Altima drivers have reported near-accidents, that they no longer drive their vehicle because of the safety risk, or that they now avoid driving during the day. (See, e.g., Ex. 7 at 2467, , 2488, 2503, 2548, 2619, 2711; see also Ex. 22 (Diklich report) at 4-5 (finding glare from melting dashboards to pose a safety risk).) The melting-dashboard defect is also significant to Altima owners because of how costly it is to repair. Because the entire dashboard needs to be replaced, (Id., Ex. 23 at 1846.) (Ex. 20 at 110:12-16.) Many Altima owners cannot afford this high repair price, leaving them with little choice but to live with an unsightly dashboard that diminishes the market value of the Altima and makes driving it dangerous. B. Nissan Failed To Properly Formulate or Test The Dashboard Material Before Installing It In Class Vehicles. Before selling 2008 or 2009 Altimas to Florida consumers, Nissan should have known that the plastic skin used in those vehicles dashboards was not properly formulated for the high levels of heat and humidity encountered in Florida. It has long been known within the industry that TPUs are subject to hydrolysis in warm humid environments. (Zeman Decl., Ex. 2 at 14 & 18, 3.) And the technology needed to test TPUs at elevated humidity and temperature, such as thermo-hygrostatic chambers or environmental temperature/humidity chambers, was readily available decades before class vehicles were first sold. (Id. at 15 & 18, 5.) As Anand Kasbekar, Ph.D., an expert in plastic automotive materials, stated in his report, Nissan should have tested the TPU material at elevated temperature and humidity and should have made certain that hydrolysis stabilizers were present in this material. (Id. at 18, 10; see also id. at ) 5

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12 otherwise treating the dashboards installed in Altimas. Nor did it tell Altima owners about the defect, which would have allowed consumers who lived in hot and humid areas to obtain a warranty repair or otherwise attempt to mitigate the inevitable effects of TPU deterioration. D. Nissan Continues To Conceal The Melting Dashboard Defect From Its Consumers. By the time Altima owners began to discover the TPU defect on their own through visibly melting dashboards Nissan s standard 3-year/36,000-mile warranty had expired and the company was refusing to replace the defective dashboards under warranty. (See Zeman Decl., Ex. 3 at 46:3-6 ( if the issue manifests itself after three years and the warranty expires after three years, pretty much by definition, it s going to be out of warranty ).) (See id., Ex. 1 at 133:13-135:25; Ex, 3 at 114:5-7 ( there should be something that the dealers can do to replace these dashboards on the affected cars just in Florida ).) Instead, Nissan has refused to publicly acknowledge that melting dashboards are widespread or indicative of a defect in the dashboard material. The company has consistently portrayed the issue in the media as nothing more than a few isolated consumer complaints about the dashboard appearance, melting dashboards do not constitute a safety issue (Id., Exs ; Ex. 7; Ex. 26 at 1837.) Nissan also maintains that (Id., Ex. 31 at 3672.) 7

13 E. Florida Consumers Have Suffered Damages As A Result Of Nissan s Deception, While Nissan Has Unfairly Profited. As a result of the dashboard defect, the Altimas that Nissan sold to Florida consumers were worth substantially less than had Nissan sold them non-defective vehicles. To measure the impact of Nissan s conduct, Plaintiffs retained Frank Bernatowicz, a CPA, MBA, and PE specializing in valuation and quantification of damages. (Zeman Decl., Ex. 32 (Bernatowicz report) at 1-3.) Using two wellaccepted valuation methods, Mr. Bernatowicz has estimated class-wide damages at $46.6 million to $53.7 million (excluding pre-judgment interest), or between $1,439 to $1,774 per class member. (Id. at 19, 82.) Mr. Bernatowicz has also estimated that Nissan acquired $190.7 million in profits from its sale of class vehicles in Florida, and that a fair measure of the excess profits it obtained as a result of the alleged unfair conduct is between $1,111 and $1,280 per class vehicle. (Id. at 20, ) III. ARGUMENT For a district court to certify a class action, the named plaintiffs must have standing, and the putative class must meet each of the requirements specified in Federal Rule of Civil Procedure 23(a), as well as at least one of the requirements set forth in Rule 23(b). Vega v. T-Mobile USA, Inc., 564 F.3d 1256, 1265 (11th Cir. 2009). Additionally, courts have found that 23(a) contains an implicit requirement, that the proposed Class is adequately defined and clearly ascertainable. Randolph v. J.M. Smucker Co., 303 F.R.D. 679, 684 (S.D. Fla. 2014) (quoting Little v. T Mobile USA, Inc., 691 F.3d 1302, (11th Cir. 2012)). As discussed in the sections that follow, Plaintiffs and the proposed class satisfy each of these class certification requirements. A. The Named Plaintiffs Have Standing. [I]t is well-settled that prior to the certification of a class, and technically speaking before undertaking any formal typicality or commonality review, the district court must determine that at least one named class representative has Article III standing to raise each class subclaim. Prado-Steiman ex rel. Prado v. Bush, 221 F.3d 1266, 1279 (11th Cir. 2000). Specifically, the Court must determine whether the class representative is part of the class and possess[es] the same interest and suffer[ed] the same injury as the class members. Veal v. Crown Auto Dealerships, Inc., 236 F.R.D. 572, 577 (M.D. Fla. 2006) (quoting Prado Steiman, 221 F.3d at 1279) (brackets in original). The Court has already conducted a standing analysis in connection with Nissan s motion to dismiss, and concluded that Plaintiffs have standing to bring claims related to the purchase of Nissan Altima vehicles. (See 6/15/15 Order [Doc. 44] at 4-5.) Nothing has occurred since then that 8

14 would undermine Plaintiffs standing. Each purchased a Nissan Altima (a 2008 Altima in Plaintiff Lucrezia s case and a 2009 Altima in Plaintiff Sanborn s), and so each is a member of the proposed class. (See Zeman Decl., Ex. 33 at 202; Ex. 34.) Plaintiffs Lucrezia and Sanborn have likewise suffered the same alleged injury as other class members namely, the Nissan Altimas that they purchased were worth less as a result of the dashboard defect. B. The Proposed Class Is Adequately Defined and Ascertainable. Before establishing the explicit requirements of Rule 23(a), a plaintiff must first establish that the proposed Class is adequately defined and clearly ascertainable. Randolph, 303 F.R.D. at 684. This ascertainably requirement asks (i) whether members of the proposed class can be ascertained by reference to objective material, and (ii) whether analysis of that objective criteria is administratively feasible, such that identifying class members [would be] a manageable process that does not require much, if any, individual inquiry. Bussey v. Macon Cty. Greyhound Park, Inc., 562 F. App'x 782, 787 (11th Cir. 2014). Here, Plaintiffs propose that the Court define the class as follows: All persons who purchased or leased a 2008 or 2009 Nissan Altima vehicle from an authorized Nissan dealer in Florida prior to January 1, This class definition uses only objective criteria, and so is adequately defined. It is also clearly ascertainable, as class members can be identified through a manageable and easily verifiable process. (Id., Ex. 35 (Miller Dep.) at 28:10-12, 123:17-124:4.) Using this data, it will be relatively simple to generate a list of all Nissan customers who meet the criteria for class membership. In addition, if any class members do need to identify themselves for some reason, they will be able to do so through a variety of documents that vehicle owners typically maintain: sales invoices, certificates of title, registration documents, and service records, for example. Compare Karhu v. Vital Pharm., Inc., No CIV, 2014 WL , at *3 (S.D. Fla. Mar. 3, 2014) (class of consumers who made a relatively small purchase compared with, for example, a car or a major appliance was not ascertainable), with Sanchez-Knutson, 310 F.R.D. at 542 (ascertainability requirement met for a class of Florida consumers who purchased or leased a Ford Explorer from authorized Ford dealers in Florida). 9

15 C. The Proposed Class Satisfies Rule 23(a). 1. Rule 23(a)(1) - Numerosity Rule 23(a)(1) requires that a class be so numerous that joinder of all members is impracticable. As a general rule, a proposed class is considered sufficiently numerous if it consists of more than forty people. See Vega, 564 F.3d at Here, Nissan has confirmed that far more than 40 Florida consumers purchased or leased a 2008 or 2009 Altima closer to 40,000, in fact. (See Zeman Decl., Ex. 36 at 4 ( There were 25,578 MY08 Altima vehicles and 16,776 MY09 Altima vehicles sold or leased by Florida dealers )); compare Sanchez-Knutson, 310 F.R.D. at 536 (finding proposed class easily meets the numerosity requirement where defendant had produced a chart showing that 31,165 class vehicles were sold in Florida). As it is not feasible to individually join each of these Altima consumers, the proposed class satisfies Rule 23(a)(1) s numerosity requirement. 2. Rule 23(a)(2) - Commonality The commonality requirement of Rule 23(a)(2) requires there be questions of law or fact common to the class. Plaintiffs burden in this regard has been described as relatively light, since commonality does not require that all questions of law and fact raised be common. Vega, 564 F.3d at So long as there is at least one issue that is capable of class-wide resolution that is, one issue can be answered for all class members in a single stroke the commonality requirement is deemed satisfied. Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551 & 2557 (2011). Here, there are a number of issues that can be resolved for all class members through a single trial, including: (i) whether the dashboard material installed in the Nissan Altima is defective; (ii) whether as a legal matter, Nissan was required to know or at least have reason to know about the defect to be liable under the FDUTPA; (iii) if so, whether and when did Nissan know or should have known that the Nissan dashboard material was defective; (iv) whether Nissan s conduct would be considered unfair or deceptive by a reasonable consumer ; (v) whether it is inequitable for Nissan to retain profits it acquired as a result of selling dashboards with defective material; and 10

16 (vi) whether the dashboard defect affected the fair market value of the Nissan Altima. See Sanchez-Knutson, 310 F.R.D. at 537 (commonality satisfied because the question of whether Ford sold vehicles with a defective condition is common to all class members); Randolph, 303 F.R.D. at 693 (commonality satisfied because the issue of deceptiveness under the FDUTPA is common to all class members). 3. Rule 23(a)(3) Typicality Typicality requires that the claims or defenses of the representative parties are typical of the claims or defenses of the class. Fed. R. Civ. P. 23(a)(3). Like the commonality requirement, the typicality requirement is permissive: representative claims are typical if they are reasonably coextensive with those of absent class members; they need not be substantially identical. In re Checking Account Overdraft Litig., 275 F.R.D. 666, 674 (S.D. Fla. 2011). In general, [t]he claim of a class representative is typical if the claims or defenses of the class and the class representative arise from the same event or pattern or practice and are based on the same legal theory. Williams v. Mohawk Indus., Inc., 568 F.3d 1350, 1357 (11th Cir. 2009). Here, Plaintiffs Sanborn and Lucrezia have essentially the same claims as every other Florida consumer who purchased a 2008 or 2009 Altima: Nissan sold them all a vehicle with allegedly defective dashboard material; Nissan failed to disclose information about its dashboard materials that it should have known or discovered through pre-release testing; and Nissan failed to disclose that the dashboards were defective. In other words, the same course of conduct by Nissan gave rise to the same FDUTPA and unjust enrichment claims for all class members and caused them each the same injury namely, diminution in the market value of the Altima due to the melting dashboard defect. See Sanchez-Knutson, 310 F.R.D. at 539 (typicality satisfied where plaintiffs claims were the result of a systemic defect shared by all class vehicles); Wolin v. Jaguar Land Rover N. Am., LLC, 617 F.3d 1168, 1175 (9th Cir. 2010) (plaintiff asserting FDUTPA claim had same interest as others with same alleged vehicle defect). 4. Rule 23(a)(4) Adequacy Rule 23(a)(4) requires a showing that the representative parties will fairly and adequately protect the interests of the class. This adequacy-of-representation requirement encompasses two separate inquiries: (1) whether any substantial conflicts of interest exist between the representatives and the class; and (2) whether the representatives will adequately prosecute the action. Busby v. JRHBW 11

17 Realty, Inc., 513 F.3d 1314, 1323 (11th Cir. 2008). Adequacy of representation is presumed unless there is evidence to the contrary. Brown v. SCI Funeral Servs. of Florida, Inc., 212 F.R.D. 602, 605 (S.D. Fla. 2003). Neither of the proposed class representatives here have any conflicts of interest with the proposed class of Nissan Altima owners. To the contrary, their interests are aligned Ms. Sanborn, Mr. Lucrezia, and the rest of the proposed class will all benefit if Plaintiffs successfully prove that Nissan violated the FDUTPA or unjustly enriched itself by selling class vehicles with defective dashboard material. Plaintiffs have shown through their conduct to date that they are motivated to obtain monetary relief for all class members. They have retained counsel experienced in prosecuting automotive defect class actions (see Zeman Decl., Exs (firm résumés)); successfully opposed Nissan s motion to dismiss the case (Doc. 31); uncovered key internal documents through discovery and motion practice that have advanced the class s claims against Nissan (see Docs. 45, 72; Zeman Decl., Exs. 3-13, 19, 21-23, 25-31); deposed several Nissan employees in preparation for trial and appeared for their own depositions (id., Exs. 1, 3, 20, 24, 35); and engaged four experts to study and explicate some of the technical issues raised by the class s claims (id., Exs. 2, 22, 32, 39). At this stage of the litigation, there should be no reason to doubt that Plaintiffs are adequate representatives for the class and will continue protecting class members interests at trial. D. The Proposed Class Satisfies Rule 23(b)(3). 1. Rule 23(b)(3) - Predominance To certify a class under Rule 23(b)(3), the Court must find that the questions of law or fact common to class members predominate over any questions affecting only individual members. Fed. R. Civ. P. 23(b)(3). The predominance inquiry begins, of course with the elements of the underlying cause of action. Erica P. John Fund, Inc. v. Halliburton Co., 131 S.Ct. 2179, 2184 (2011). Plaintiffs are not required to prove every element of their claims are susceptible to class-wide proof. Amgen Inc. v. Connecticut Ret. Plans & Trust Funds, 133 S. Ct. 1184, 1196 (2013). Rather, the Court should assess each element and determine whether those issues that are subject to generalized proof, and thus applicable to the class as a whole, predominate over those issues that are subject only to individualized proof. Rutstein v. Avis Rent-A-Car Sys., Inc., 211 F.3d 1228, 1233 (11th Cir. 2000); see also Klay v. Humana, Inc., 382 F.3d 1241, 1264 (11th Cir. 2004) ( [W]hen there exists generalized evidence which proves or disproves an element on a simultaneous, class-wide basis, the predominance test will be met. ) (quoting In re Terazosin Hydrochloride, 220 F.R.D. 672, 694 (S.D. Fla. 2004)). 12

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19 injurious to consumers), or it is not. So if Plaintiffs succeed in proving that Nissan committed an unfair or deceptive practice, they will have done so for all class members each of whom were exposed to the same conduct. The principal difference between Plaintiffs three theories of liability is the degree of knowledge required to hold Nissan liable. Under the first theory, it does not matter whether Nissan knew it was selling cars with defective dashboards; it only matters that selling cars with defective dashboards is unfair and deceptive to consumers. See Gavron v. Weather Shield Mfg., Inc., 819 F. Supp. 2d 1297, 1302 (S.D. Fla 2011) ( FDUTPA does not require [a defendant] to have subjective knowledge of alleged defects in order for [a plaintiff] to state a viable FDUTPA claim. ). Under the second theory, it does not matter whether Nissan knew about the defect, only that it should have known about the dashboard defect. See Rothstein v. DaimlerChrysler Corp., No. 8:05-CV-1126T30-MSS, 2005 WL , at *2 (M.D. Fla. Nov. 18, 2005) (selling vehicles that the manufacturer knew or should have known were defective stated a cause of action under FDUPTA ). And the third theory requires that Nissan have actual knowledge of the dashboard defect before it can be held liable. Although Plaintiffs do not believe that actual knowledge is necessary before Nissan s conduct can be considered unfair or deceptive under the FDUTPA, Nissan has taken the position that it cannot be held liable unless Plaintiffs prove it knew about the defect. (See 2/9/15 Nissan Motion to Dismiss [Doc. 24] at ) This dispute over the degree of knowledge required by Nissan presents another issue that can and should be resolved for class members in a single proceeding. ii. Causation The causation element of the FDUTPA is an objective, not subjective, standard. Nivia v. Nationstar Mortgage, LLC, No. 13-CIV-24080, 2014 WL , at *5 (S.D. Fla. Aug. 21, 2014). [T]he question is not whether the plaintiff actually relied on the alleged deceptive trade practice, but whether the practice was likely to deceive a consumer acting reasonably in the same circumstances. Davis v. Powertel, Inc., 776 So. 2d 971, 974 (Fla. Dist. Ct. App. 2000); see also Fitzpatrick v. Gen. Mills, Inc., 635 F.3d 1279, 1283 (11th Cir. 2011) ( a plaintiff need not prove reliance a plaintiff must simply prove that an objective reasonable person would have been deceived ). The objective nature of FDUTPA s causation standard is significant for class certification. Whereas a subjective standard might yield different answers for different consumers, the FDUTPA s objective standard will yield the same answer for the entire class. Plaintiffs will present common evidence including expert testimony, customer complaints, and the statements of Nissan s own 14

20 employees to show that an objectively reasonable consumer would consider the melting dashboard defect to be significant and would be deceived both by Nissan s sale of Altima vehicles with defective dashboard material and by its failure to disclose the dashboard defect. Based on that common evidence, a jury will be able to decide for all class members whether the FDUTPA s causation element has been satisfied. Causation therefore presents yet another common issue and weighs in favor of class certification. Fitzpatrick, 635 F.3d at 1283 ( whether that allegedly deceptive conduct would deceive an objective reasonable consumer [is a] common issue[ ] for all the putative class members, amenable to classwide proof ) (brackets in original). iii. Damages The final element of Plaintiffs FDUTPA claim is damages, which have long been defined as the difference in the market value of the product or service in the condition in which it was delivered and its market value in the condition in which it should have been delivered according to the contract of the parties. Collins v. DaimlerChrysler Corp., 894 So. 2d 988, 990 (Fla. Dist. Ct. App. 2004). Similar to the Collins case, [t]his case turns on a relatively simple question, at least as to damages Is a car with defective [dashboard material] worth less than a car with [a non-defective dashboard]. Id. at 991. Plaintiffs plan to answer that question at trial through the expert testimony of Frank Bernatowicz, who has used a conjoint analysis to measure the effect of the melting dashboard defect on consumer preference and willingness to pay for a Nissan Altima. (See Zeman Decl., Ex. 32 at 10, 13-15); see also Ex. 39 at 18 (results of conjoint survey).) This type of damages analysis was found to be an acceptable form of class-wide proof in the Sanchez-Knutson auto defect case against Ford, as well as in numerous other consumer class actions. See, e.g., Sanchez-Knutson, 310 F.R.D. at ; Khoday v. Symantec Corp., 2015 WL , *12 (D. Minn. March 19, 2015); In re ConAgra Foods, Inc., 2015 WL (C.D. Cal. Feb. 23, 2015). In addition, Mr. Bernatowicz has used an alternative damages analysis, which estimates diminution of value of all class vehicles using another well-accepted valuation metric called curable functional obsolescence. (Zeman Decl., Ex. 32 at ) The two damages analyses achieve consistent results and neither method requires individualized testimony from class members. (Id. at 15, 62.) The Eleventh Circuit has made clear that individual issues relating to damages do not defeat class certification. In re Checking Account Overdraft Litig., 307 F.R.D. 656, (S.D. Fla. 2015). Nonetheless, Plaintiffs expect that they will be able to prove damages for the entire class using common evidence and common damages formulae adding one more issue that can be resolved on a class-wide 15

21 basis. Together with the common liability issues discussed above, Plaintiffs submit that FDUTPA presents predominantly if not exclusively common issues that can best be resolved through a single class-wide proceeding. b. The Elements of Plaintiffs Unjust Enrichment Claim Will Be Proven Using Generalized Evidence. The unjust enrichment claim Plaintiffs seek to certify also has three elements: (1) a benefit conferred upon Nissan; (2) Nissan s appreciation of the benefit; and (3) Nissan s retention of the benefit under inequitable circumstances. Kopel v. Kopel, 117 So. 3d 1147, 1152 (Fla. Dist. Ct. App. 2013). Just as with Plaintiffs FDUTPA claims, each of these elements can be proven on a class-wide basis using generalized evidence. i. A Benefit Conferred on Nissan The same records that will be used to ascertain class membership namely, Nissan s records of Altima sales to Florida consumers can also be used to show that each class member conferred a benefit on Nissan when they paid for a class vehicle. (Zeman Decl., Exs. 33, 35 at 28:10-12, 123:17-124:4.) That benefit was not paid directly to Nissan, however, but to Nissan dealerships, which creates two additional issues. The first is the legal issue of whether it is sufficient that class members conferred a benefit on Nissan through indirect payments, or whether the law requires that they have paid Nissan directly. At least one court has found that indirect payments are sufficient. See Carriuolo, 72 F. Supp. 3d at 1326 ( It is of no matter that the benefit passed through independent dealerships. ) But what matters at this stage is not whether class members will prevail on this question, but that further proceedings will generate a common answer. The second issue is a damages issue: how much of a benefit was passed through to Nissan by its authorized dealerships. As discussed above, individual issues relating to damages typically do not defeat class certification. See In re Checking Account Overdraft Litig., 307 F.R.D. at But common damages issues can enhance the need for a class-wide proceeding. That is the case here, where individual class members are not in position to figure out how much of their purchase price should be traced to Nissan as profit and how much to dealer markup or manufacturing costs, for example. It is essentially an accounting question, and one that is best performed one time on behalf of the entire class. Plaintiffs counsel has retained a CPA to conduct just that analysis and present his conclusions at trial. (See Zeman Decl., Ex. 32 (Bernatowicz report) at ) 16

22 ii. Appreciation of the Benefit The second element of an unjust enrichment claim is satisfied if the defendant realized that a benefit was being bestowed and knowingly accepted and retained that benefit. Jackson-Jester v. Aziz, 48 So. 3d 88, 92 (Fla. Dist. Ct. App. 2010). This element should not be very controversial, as Nissan s business is selling cars through authorized dealerships, so it undoubtedly was aware that class members were bestowing it with a benefit when they purchased a Nissan Altima, enthusiastically accepted proceeds from the sale of those vehicles, and retained rather than refunded those proceeds. Nevertheless, to the extent that Nissan contests this element and Plaintiffs need to prove it at trial, they will do so with common evidence. Nissan s sales records, publicly available financial data, and testimony from Nissan executives could all be used to establish that Nissan did, in fact, appreciate that it was receiving a benefit from the sale of Altima vehicles. iii. Retention of the Benefit Under Inequitable Circumstances The Eleventh Circuit has observed that the final element of an unjust enrichment claim typically raises individual issues, as the equities involved will often depend on each class member s specific interactions with the defendant. Vega, 564 F.3d at But in County of Monroe, Florida v. Priceline.com, Inc., 265 F.R.D. 659, 671 (S.D. Fla. 2010), the court found that where a [d]efendant s business operations are the same as to all members of the putative class, class certification may nonetheless still be appropriate. That is the case here, as the business operations that Plaintiffs challenge were the same for all class members. Each was sold a vehicle with defective dashboard material and none was informed about the defect, even though Nissan knew or should have known that the dashboards in class vehicles were unable to withstand Florida s heat and humidity. See James D. Hinson Elec. Contracting Co. v. BellSouth Telecommunications, Inc., 275 F.R.D. 638, 647 (M.D. Fla. 2011) ( As in Priceline.com, BellSouth's conduct was the same with regard to each class member in all relevant respects. ) Accordingly, the same common evidence that Plaintiffs plan to present to prove unfair and deceptive conduct in violation of the FDUTPA can also be used to prove inequitable conduct toward the entire class. See In re Checking Account Overdraft Litig., 286 F.R.D. 645, (S.D. Fla. 2012) (certifying unjust enrichment claim where class-wide proof was available to show that defendant deliberately concealed material information from its customers). 17

23 2. Rule 23(b)(3) - Superiority The second prong of Rule 23(b)(3) requires the Court to determine whether a class action is superior to other available methods for fairly and efficiently adjudicating the controversy. Fed. R. Civ. P. 23(b)(3). Among the factors that should be considered as part of a superiority analysis are: (A) the class members interests in individually controlling the prosecution or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already begun by or against class members; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and (D) the likely difficulties in managing a class action. Id. Here, as in Sanchez-Knutson v. Ford, a class action is the superior method for adjudicating vehicle owners claims against the automaker that sold them a defective product. First, the number of class members is too large for the prosecution of separate actions by each class member to be likely, practical, or desirable. Sanchez-Knutson, 310 F.R.D. at 541. Second, Plaintiffs are not aware of any other litigation concerning the melting dashboard defect. Even though the high volume of consumer complaints and extensive media coverage indicate that class members are very angry about the melting dashboard defect, and believe they have been harmed by Nissan s conduct, it simply is not realistic for most consumers to file and prosecute individual lawsuits. Third, concentrating class members claims in this particular forum is desirable, as the lawsuit is brought on behalf of Florida consumers and the melting dashboard defect predominantly affects Altima owners in Florida. And fourth, it does not appear that this case will present manageability problems beyond those typically encountered in the adjudication of a consumer class action. Id. at 541. IV. CONCLUSION For the reasons set forth above, Plaintiffs request that the Court certify the following class pursuant to Rule 23(b)(3): All persons who purchased or leased a 2008 or 2009 Nissan Altima vehicle from an authorized Nissan dealer in Florida prior to January 1, This proposed class meets all the requirements for class certification and would enable thousands of Altima owners, who each have essentially the same legal claims as Plaintiffs, to participate in this litigation and potentially receive compensation for the alleged melting dashboard defect. 18

24 Dated: January 29, 2016 Respectfully Submitted, GIBBS LAW GROUP LLP By: /s/ Amy Zeman Amy Zeman (FL Bar No ) 3711 Sheridan Ave Miami Beach, FL T: (510) F: (510) Eric H. Gibbs (admitted pro hac vice) One Kaiser Plaza, Suite 1125 Oakland, CA T: (510) F: (510) Gregory F Coleman (admitted pro hac vice) Adam Edwards (admitted pro hac vice) GREG COLEMAN LAW PC 800 South Gay Street, Suite 1100 Knoxville Tennessee T: (865) F: (510) greg@gregcolemanlaw.com adam@gregcolemanlaw.com John A. Yanchunis (FL Bar No ) James D. Young (FL Bar No ) MORGAN & MORGAN 201 N. Franklin St. 7 th Floor Tampa, FL Phone: (813) Fax: (813) jyanchunis@forthepeople.com jyoung@forthepeople.com Attorneys for Plaintiffs 19