Toyota Motor Corp. has appealed last month’s rejection by a federal judge of its motion to compel arbitration in the consolidated economic class action over sudden acceleration.
The interlocutory appeal to the U.S. Court of Appeals for the Ninth Circuit is the second that Toyota has filed in the class action, which seeks economic damages on behalf of consumers on the ground that Toyota made false and misleading statements about the safety of its vehicles. The plaintiffs claim that, as a result of Toyota’s alleged undisclosed defects associated with sudden acceleration, their vehicles lost value.
The case represents approximately 200 of the 300 cases in multidistrict litigation against Toyota over sudden acceleration. The rest won’t be affected by the appeal because they were filed on behalf of individuals who were injured or died in accidents attributed to sudden acceleration.
The economic class action is scheduled for trial on July 31, 2013, as the first bellwether case involving consumer damages. The case, which has not been certified as a class, was brought by 27 named plaintiffs in California, New York and Florida. Toyota had moved to arbitrate 21 of these claims. One plaintiff voluntarily dismissed a claim.
Toyota argued that it could not move to compel arbitration against the California class representatives before the U.S. Supreme Court ruled last year in AT&T Mobility LLC v. Concepcion that the Federal Arbitration Act pre-empted a California rule blocking enforcement of arbitration clauses forcing consumers to waive their right of file class actions. As for the class representatives in other states, Toyota argued that it needed to wait until the plaintiffs lost their effort last year to argue the case under California law.
On March 12, U.S. District Judge James Selna in Santa Ana, Calif., ruled that Toyota had waived its right to compel arbitration in 15 of the 20 class representative claims, all in California, because it waited too long and had aggressively pursued its defense.
“By continuing to actively defend the present MDL and, more specifically, the economic loss claims, without a whisper of the intent to seek an order compelling arbitration, Toyota has engaged in numerous acts that are inconsistent with the right to compel arbitration,” he wrote.
As for the remaining five plaintiffs — one in New York and four in Florida — the dealerships, not Toyota, had the right to enforce arbitration provisions signed by consumers in their purchase and lease agreements, Selna ruled.
Toyota filed a notice of appeal with the Ninth Circuit on April 11. Listed as appellate counsel are Gibson, Dunn & Crutcher’s Theodore Boutrous, co-chairman of the firm’s appellate and constitutional law group, and associate Blaine Evanson, both in Los Angeles. The opening brief is due on Sept. 18.
The appeal is the second interlocutory petition that Toyota has filed in the economic class action. Already pending before the Ninth Circuit is Toyota’s appeal of Selna’s earlier ruling allowing millions of consumers to sue the company even though their cars didn’t experience a defect or sell for reduced prices following the company’s recall of more than 8 million vehicles. Selna concluded that plaintiffs had relied on advertising promoting the safety of Toyota’s vehicles. Boutrous also is handling that appeal.
Briefing in that appeal was completed on April 10, but no oral argument has been scheduled so far.
Contact Amanda Bronstad at firstname.lastname@example.org.