A Miami federal judge tossed a lawsuit claiming boat and RV owners lost money because of allegedly defective refrigerators.
The case tanked Thursday when U.S. District Judge Robert Scola ruled the plaintiffs have no standing to sue Pompano Beach-based manufacturer Dometic Corp.
The dismissal highlights the challenges of pursuing economic loss claims in product defect cases. Economic loss plaintiffs claim they’re damaged not because they experienced a problem with their product, but because they paid more than they would have if they knew it was defective.
It’s a claim that figures prominently in the Takata air bag litigation and other big auto defect cases filed in Miami federal court.
The plaintiffs alleged more than 3,000 Dometic refrigerators have leaked flammable gas and caused fires in the past 20 years, and two recalls failed to solve the underlying issue. But some named plaintiffs in the putative class action had working refrigerators, and those who claimed their refrigerators leaked didn’t show the problem was caused by Dometic, Scola found.
“At this stage in the litigation, the plaintiffs have failed to adequately support their allegations that there is an inherent defect that is manifest in all Dometic cooling units and that they have suffered economic harm as a result of the defect,” Scola wrote in the summary judgment order. “Based on the evidence before the court, the plaintiffs’ purported injuries are more speculative than imminent.”
Plaintiffs with operational refrigerators claimed the resale value of their RVs and boats fell because buyers were scared off by the potential defect. But the complaint also alleged consumers didn’t know about the defect, which Scola ruled was contradictory.
When a federal court considered economic loss claims in the Toyota sudden acceleration litigation, the judge accepted the theory consumers can suffer damages when they don’t get the benefit of their bargain. But the court also found those plaintiffs had standing only if they attempted to sell or trade in their cars, Scola noted.
None of the named plaintiffs in the Dometic case showed they actually tried to sell their RVs or boats, and none could show any loss of value in their refrigerators, Scola found.
The judge allowed the plaintiffs to re-file the case.
“Our legal team is evaluating the court’s ruling and analyzing it with an eye toward best assisting our class representatives and the proposed class of consumers,” said plaintiffs attorney Adam Moskowitz, a partner at Kozyak Tropin & Throckmorton in Coral Gables.
The other firms representing the plaintiffs are Searcy Denney Scarola Barnhart & Shipley in West Palm Beach and Zimmerman Reed in Scottsdale, Arizona, which won a $36 million settlement in a similar case against a different refrigerator manufacturer.
Dometic is represented by Weil, Gotshal & Manges and Lash & Goldberg in Miami.
“The trial court carefully considered a number of very complex issues and — consistent with the Eleventh Circuit’s views on no-injury class actions where the defect has not manifested — determined that the plaintiffs failed to establish any likelihood of product failure, or that they suffered any damages,” Weil partner Ed Soto said. “This order underscores the importance of showing more than a mere risk of purported injury in these types of cases.”
Another federal lawsuit over the alleged Dometic refrigerator defect is pending in the Northern District of California.