Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 1 of 7 11/03/2014 Andrew B. Bloomer, P.C. To Call Writer Directly: (312) 862-2482 andrew.bloomer@kirkland.com 300 North LaSalle Chicago, Illinois 60654 (312) 862-2000 www.kirkland.com Facsimile: (312) 862-2200 United States District Court for the Southern District of New York 500 Pearl Street New York, NY 10007 Re: In re: General Motors LLC Ignition Switch Litigation, 14-MD-2543 (JMF); 14-MC-2543 Dear Judge Furman: Pursuant to this Court s Order No. 8 IV.B, counsel for General Motors LLC ( New GM ) and Lead Counsel having met and conferred on multiple occasions with each other as well as with counsel for Delphi Automotive Systems, LLC ( Delphi ), Delphi Automotive PLC, Don McCue Chevrolet, Inc., Continental Automotive Systems, Inc., AutoFair Chevrolet, LLC, and Stoneridge, Inc. (collectively, Defendants ) submit this joint letter setting forth the parties tentative agenda for the November 6 Status Conference. The parties believe that the Court does not need to allot more than three hours for the Status Conference. 1. MDL 2543 Website Lead Counsel have developed, and sent to Defendants counsel, a proposed official website, to be maintained by the parties under court authorization, to include current information and important documents in the MDL. The contents include those specified in Paragraph 13 of the court s Coordination Order, which has been entered in Melton II and the Texas MDL. The link to the draft site is http://gmignitionmdl.com/. Defendants believe that the official MDL 2543 website should be created and maintained by the Court, as is customary in multidistrict litigation, in order to avoid unnecessary disputes should the parties maintain the site. 1 Defendants also object to certain content on Lead Counsel s proposed site because it lacks neutrality, is not consistent with the Court s orders, and may cause confusion. 1 See, e.g., the September 11th Litigation Cases (http://www.nysd.uscourts.gov/sept11), Toyota Unintended Acceleration MDL (http://www.cacd.uscourts.gov/news/re-toyota-motor-corp-unintended-acceleration-mdl), Deepwater Horizon MDL (http://www.laed.uscourts.gov/oilspill/oilspill.htm). Upon request, Defendants will provide the Court with a list of additional court-managed official MDL websites. Be jing Hong Kong Houston London Los Angeles Munich New York Palo Alto San Francisco Shanghai Washington, D.C.
Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 2 of 7 Page 2 2. MDL 2543 Document Depository The parties continue to meet and confer regarding potential alternatives to ShareVault to serve as the MDL 2543 Document Depository. The parties respectfully request that the Court defer argument on the issues related to the MDL 2543 Document Depository, including cost sharing, until the December 15 Status Conference. 3. Coordination of Melton II Motion To Compel Counsel for New GM submitted a letter to the Court yesterday regarding New GM s proposal for coordinated adjudication of the Motion to Compel filed by plaintiffs in Melton II (14-MD-2453 ECF No. 369). Lead Counsel do not agree with New GM s proposal. Lead Counsel s position is that they endorse the principle embodied in the Coordination order, and it is within the Court s discretion to participate in this determination, but this is a case-specific matter, arising under Georgia law and involving conduct occurring in the Georgia court, and is appropriately decided by that court. The Motion to Compel raises issues of fraud and perjury under Georgia law that may have occurred in the Melton I proceeding. As such, Lead Counsel maintain that the Melton Court should decide the motion as it implicates the integrity of that Court. 4. Consolidated Complaint Briefing Schedule In accordance with Order No. 18 7, the parties agree that all briefing should be deferred with respect to Plaintiffs Consolidated Complaint Concerning All GM-Branded Vehicles That Were Manufactured By Old GM And Purchased Before July 11, 2009 ( Pre-Sale Consolidated Complaint ) (MDL ECF No. 347) until after the Bankruptcy Court decides New GM s pending Motions to Enforce. In so agreeing to this procedure, Plaintiffs reserve their position that, for various reasons, the Pre-Sale Consolidated Complaint is outside the ambit of Bankruptcy Court jurisdiction, and that New GM s ongoing conduct regarding all recalled vehicles is under this Court s jurisdiction. The parties disagree as to whether motion practice should also be deferred with respect to Plaintiffs Consolidated Complaint Concerning All GM-Branded Vehicles That Were Acquired July 11, 2009 Or Later ( Post-Sale Consolidated Complaint ) (MDL ECF No. 345). The vast majority of claims asserted in the Post-Sale Consolidated Complaint are brought on behalf of plaintiffs who own or lease vehicles manufactured by General Motors Corporation ( Old GM ) prior to the Sale Date, but that were acquired by these plaintiffs after the Sale Date. It is Defendants position that, pursuant to the Bankruptcy Court s prior rulings in Phaneuf, Elliott, and Phillips, motion practice regarding the Post-Sale Consolidated Complaint
Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 3 of 7 Page 3 should be deferred until after the Bankruptcy Court decides New GM s Motions to Enforce. The Bankruptcy Court has already ruled that claims involving vehicles manufactured by Old GM are subject to the Bankruptcy Court s exclusive jurisdiction to interpret and enforce its Sale Order and Injunction, regardless of when the Old GM vehicles were acquired. The Bankruptcy Court also has ruled that isolated claims with respect to vehicles manufactured by New GM should not proceed until the Motions to Enforce are decided when they are interspersed in a single complaint among claims with respect to Old GM vehicles, as they are in the Post-Sale Consolidated Complaint. Proceeding piecemeal here with respect to a handful of state law claims asserted by plaintiffs as to New GM vehicles also would not make sense in light of the Post-Sale Consolidated Complaint s global allegation that Michigan law applies nationwide to Plaintiffs claims for fraudulent concealment, unjust enrichment, breach of the implied warranty of merchantability, and the Magnuson-Moss Warranty Act (Id. at 835), while the same or substantially similar claims under the laws of each of the 50 states are pleaded in the alternative only [i]n the event the Court declines to certify a Nationwide Class under Michigan law. (See, e.g., id. at 1064). Thus, any piecemeal rulings with respect to the laws of individual states, as Lead Counsel suggest, would be no more than advisory until the Bankruptcy Court rules and the Michigan choice-of-law issue is first decided by this Court. It is Plaintiffs position that New GM should respond to the complaint in a few key bellwether states, such as California, D.C., and Oklahoma, where the plaintiff purchased a car manufactured and sold by New GM. As to cars made by Old GM but purchased during New GM s existence, these claims are based on New GM s conduct and are not subject to the jurisdiction of the Bankruptcy Court. Plaintiffs dispute New GM s characterizations of the Bankruptcy Court s rulings in Phaneuf, Elliot, and Phillips. While the complaints in at least some of those cases involved vehicles manufactured by Old GM with defective ignition switches but purchased after the effective date of New GM s inception, the Bankruptcy Court did not rule that claims based solely on the conduct of New GM would be subject to the Sale Order and Injunction. Rather, the Bankruptcy Court s primary motivation, as repeatedly expressed, was to prevent any of the ignition switch cases from cutting to the front of the line ahead of the other ignition switch cases. That rationale is inapplicable here, as the Post-Sale Consolidated Complaint is (i) the operative Complaint in this MDL with respect to claims based on post- Bankruptcy Sale conduct and (ii) concerns owners and lessors of all GM-branded vehicles (and not just those with the vehicles plagued with defective ignition switches.). Finally, the suggestion that choice-of-law issues must be resolved first ignores that fact that Plaintiffs have pleaded claims under the consumer protections statutes of the various states (and have not alleged that Michigan s Consumer Protection Act should be applied nationwide.) Awaiting rulings of Judge Gerber on unrelated bankruptcy issues can only cause unnecessary delay.
Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 4 of 7 Page 4 Given the difference of opinion on this threshold issue concerning the Post-Sale Consolidated Complaint, the parties have agreed to brief their respective positions regarding this issue. To resolve this threshold issue, the parties propose this briefing schedule, expressly reserving all other issues and arguments and continuing the stay of all deadlines, particularly New GM s obligation to answer or otherwise respond to both Consolidated Complaints, until further order of the Court: (i) Simultaneous initial briefs, not to exceed 20 double-spaced pages, by November 25; and (ii) Simultaneous responses, not to exceed 10 double-spaced pages, by December 10. If, after reviewing the parties briefs, the Court agrees with New GM, then all motion practice regarding the Post-Sale Consolidated Complaint will be deferred pending the Bankruptcy Court s ruling on New GM s Motions to Enforce. If, however, the Court agrees with Plaintiffs, then the parties will meet and confer and submit a joint proposal addressing the scope, timing, and page limits for their respective briefs regarding the Post-Sale Consolidated Complaint. If the parties are unable to reach an agreement, Lead Counsel and counsel for Defendants shall each submit a letter brief (not to exceed five single-spaced pages) setting forth their respective positions and attaching their respective proposed orders, as well as a redline showing the differences between the two orders. Also, the parties are continuing to meet and confer regarding Defendants objection to Plaintiffs reservation of claims contained in both the Pre-Sale Consolidated Complaint (14- MDL-2453 Docket No. 347 at 5) and Post-Sale Consolidated Complaint (14-MD-2453 Docket No. 345 at 1). It is Defendants position that any purported reservation of claims is inconsistent with and improper under this Court s Orders. The parties will raise disagreements regarding that issue, if any, at the December 15 Status Conference. 5. Phase 1 Discovery Plan And Discovery Regarding Ongoing Safety Issues Pursuant to Order No. 18 II, earlier today the parties submitted an agreed-upon proposed Phase 1 Discovery Plan order for the Court s consideration. New GM also needs to correct and clarify one issue regarding discovery of ongoing safety issues. The parties October 7 letter to the Court (14-MD-2453 Docket No. 332) states that there were 1,181,466 vehicles subject to NHTSA Recall No. 14V-047 that completed the recall repair as of October 2, 2014. As New GM worked on the search process, we learned that this is a global (worldwide) figure and that the number of vehicles in the United States subject to NHTSA Recall No. 14V-047 that completed the recall repair as of October 2, 2014, is
Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 5 of 7 Page 5 988,203. Counsel for New GM has communicated with Lead Counsel on this issue and apologizes to the Court and counsel for the inadvertent error. 6. Bellwether Trial Order Pursuant to Order No. 18 VI, the parties have submitted letter briefs setting forth their respective positions regarding a proposed bellwether trial process and schedule, their respective proposed orders, and a redline showing the differences between the two orders. (14-MD-2453 Docket Nos. 372, 375.) 7. Plaintiff Fact Sheets Pursuant to Order No. 18 IX, the parties have submitted letter briefs setting forth their respective positions regarding a proposed Consumer Economic Loss and Wrongful Death/Personal Injury Plaintiff Fact Sheets, their respective proposed orders, and a redline showing the differences between the two orders. (14-MD-2453 Docket Nos. 373, 374.) The parties also have submitted a proposed Non-Consumer Economic Loss Plaintiff Fact Sheet for the Court s consideration. (14- MD-2453 Docket No. 374 Ex. D.) Plaintiffs do not object to the proposed Non-Consumer Economic Loss Plaintiff Fact Sheet but have noted that the two existing non-consumer plaintiffs may not have all of the information requested. The parties also continue to meet and confer regarding the use of modern technology to ensure that Plaintiff Fact Sheets (a) are provided to Defendants in digital format with extracted text; and (b) have built in mechanisms to prevent errors in VIN, Social Security Number, and other personal information. 8. Deposition Protocol Order Pursuant to Order No. 18 XII, the parties continue to meet and confer regarding a proposed deposition protocol order. 9. Additional Preservation Protocols The parties have made substantial progress regarding additional preservation protocols, and plan to submit to the Court additional agreed-upon proposed preservation orders.
Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 6 of 7 Page 6 10. Permissible Modifications And Alterations of Data In The Ordinary Course of Business There are several routine actions or operations that occur in the ordinary course of Defendants businesses that may alter, delete, or overwrite system data that is created by the normal operation of computer systems (e.g., certain metadata, temporary system files, or data fragments contained in slack space or unused portions of a computer hard drive that can only be read using forensic recovery tools). Defendants do not believe that routinely upgrading computers, and the loading, reprogramming, customizing or migrating of data as part of their ordinary course of business (e.g., migrating users to new computers, or conducting routine maintenance on or replacing outdated or non-working computers) should be seen as any violation of Defendants preservation obligations, even if such actions alter the way that data is maintained, stored, or viewed, provided that Defendants undertake reasonable and good faith measures to ensure that the underlying documents (i.e., relevant user created files, as opposed to system data ) are not destroyed or altered as a result of such actions. Defendants raised this issue on October 31, 2014, and Lead Counsel will consult with their forensic experts and respond by the time of the next status conference. 11. New GM s Not Reasonably Accessible Data Filing On October 1, 2014, in compliance with Order No. 11 16, New GM submitted to the Court a letter describing sources of electronic data which may contain potentially relevant information, but which New GM does not intend to search because such data is not reasonably accessible due to undue burden and/or cost. (14-MD-2453 ECF No. 326.) On October 29, 2014, Lead Counsel sent New GM a memorandum requesting additional information related to New GM s document preservation and collection efforts. Although New GM does not believe that Lead Counsel is entitled to the discovery sought in their memorandum or that such discovery was contemplated by the Court in Order No. 18 XIV, New GM will meet and confer with Lead Counsel regarding the issues that Lead Counsel just raised in their October 29 memorandum. If the parties are unable to reach a mutually acceptable resolution regarding Lead Counsel s memorandum, the parties will raise the issue with the Court at the December 15 Status Conference. Respectfully submitted, Richard C. Godfrey, P.C. Andrew B. Bloomer, P.C.
Case 1:14-mc-02543-JMF Document 65 Filed 11/03/14 Page 7 of 7 Page 7 Counsel for Defendant General Motors LLC cc: Lead Counsel for Plaintiffs Counsel of Record for Defendants Counsel should be prepared to address, and/or update the Court with respect to, each of the issues discussed above at the November 6, 2014 status conference. In addition, counsel should confer, as appropriate, with respect to the following issues and/or questions and be prepared to address them at the conference (unless counsel believe and indicate at the conference that it would be more productive to address them at a later conference after counsel have had more time to confer): (1) the effect of the consolidated class action complaints on the underlying economic loss complaints --- namely, whether and to what extent the consolidated class action complaints should be treated as the operative pleadings superseding any prior individual complaints or as an "administrative summary." See generally In re Refrigerant Compressors Antitrust Litig., 731 F.3d 586 (6th Cir. 2013); (2) whether there are better (i.e., cheaper and more efficient) alternatives to holding bellwether trials, including but not limited to early neutral evaluation of individual cases and/or "summary" trials; (3) whether the Court should adopt some sort of process to audit and/or review plaintiffs' counsels' fee records on a regular basis, perhaps with the assistance of a certified public accountant; (4) the status of discussions regarding cost sharing by non-mdl counsel, including the appropriateness (and size) of assessments for cases that settle having used MDL resources; (5) whether and to what extent a distinction should be drawn between class certification discovery and merits discovery; and (6) the timing of class certification motion practice and/or motion practice on choice-of-law issues; (7) the status of the "Feinberg Protocol." In addition, the parties should be prepared for brief oral argument (5-10 minutes per side) on the motion to remand in People of the State of California v. General Motors LLC, 14-CV-7787 (JMF). The Clerk of Court is directed to docket this endorsed letter in 14-MD-2543 and 14-MC-2543. SO ORDERED. November 3, 2014