For the second time in the Toyota sudden-acceleration litigation, a federal judge has rejected plaintiffs attorneys’ request for leave to appeal the dismissal of claims filed on behalf of consumers alleging economic losses.
U.S. District Judge James Selna in Santa Ana, Calif., has allowed Toyota Motor Corp. to appeal two of his other orders to the U.S. Court of Appeals for the Ninth Circuit. Those appeals, also involving the consolidated class action, are pending. However, he denied the plaintiffs’ request on June 21.
Steve Berman, managing partner of Seattle’s Hagens Berman Sobol Shapiro, co-lead counsel in the consolidated class action, did not respond to a request for comment.
As for Toyota, “We believe the dismissal of most New York and Florida economic loss claims was clearly proper under New York and Florida law, and we’re pleased the Court agreed with us that plaintiffs’ counsel failed to meet the statutory requirements for certification of an interlocutory appeal,” spokeswoman Celeste Migliore said in a prepared statement.
The economic class action represents about 200 of the 300 cases in the multidistrict litigation against Toyota over sudden acceleration. The other cases won’t be affected by the appeals because they were filed on behalf of individuals injured or killed in accidents attributed to sudden acceleration.
The class action is scheduled for trial on July 13, 2012, as the first bellwether case involving consumer damages. The case, which has not been certified as a class, was brought on behalf of 27 named plaintiffs in California, New York and Florida.
On May 4, Selna dismissed claims by consumers in New York and Florida who had not experienced sudden acceleration of their vehicles. He also dismissed additional New York consumers who couldn’t allege they lost money on the sale of their vehicles due to potential defects.
His ruling did not address the California claims, which are being represented by about half of the named plaintiffs in the consolidated class action.
His ruling “extinguished” most of the New York and Florida consumers from the case, Berman complained in a May 18 filing.
“In making these rulings, the Court had to predict how it believes the highest courts in Florida and New York would decide Toyota’s motion, given that the Florida Supreme Court and the New York Court of Appeals have not addressed the issue,” he wrote. “Plaintiffs do not believe that Florida and New York law requires them to wait for the time bombs embedded in their vehicles to explode — that is, to actually experience uncontrollable [sudden, unintended acceleration] and risk death or serious bodily injury to themselves and others, or destruction of their vehicles — before asserting a claim for economic loss.”
Specifically, Berman sought to appeal whether a manifested defect is required under Florida and New York state laws. In the class action, plaintiffs have maintained that their vehicles contained inherent defects in the electronics and lacked a brake override system.
Berman noted that Selna had certified for appeal a related issue for Toyota concerning whether the plaintiffs had standing to pursue economic damages in federal court if their cars hadn’t experienced a defect or sold at depressed prices following the company’s recall of 8 million vehicles. Selna had concluded that the plaintiffs had standing because they relied on advertising promoting the safety of Toyota’s vehicles.
“In fairness, the Court should give Plaintiffs equal treatment and certify those issues for interlocutory appeal,” Berman wrote.
Toyota lead attorney Cari Dawson, a partner at Atlanta’s Alston & Bird, wrote on May 30 that the issues weren’t the same, since Toyota’s request revolved around a federal law that has been subjected to conflicting court opinions. In contrast, the plaintiffs’ interlocutory appeal was procedurally improper because a federal judge is not permitted to certify questions that would end up directly in front of Florida or New York courts.
Although he agreed that the issues were “controlling questions of law,” Selna adopted Toyota’s argument that the final answer most likely would rest with the highest courts in Florida and New York.
“This Court is not authorized to certify the identified issues for interlocutory appeal for the purpose of facilitating the appellate court to certify the issues to their respective highest state courts,” he wrote.
Plaintiffs attorneys had sought to certify for appeal a separate ruling last year in which Selna concluded that consumers should not be allowed to pursue economic damages under California’s state law if they lived or purchased their cars in another state. Selna rejected that request on Aug. 9. The ruling, which substantially reduced the prospect of a large nationwide class action with huge liabilities against Toyota, prompted plaintiffs attorneys to file an amended action involving only California, New York and Florida plaintiffs.
Theodore Boutrous, co-chairman of the appellate and constitutional law group at Gibson, Dunn & Crutcher, is representing Toyota in its appeals.
On April 11, Toyota appealed an earlier order rejecting its attempt to arbitrate 21 of the claims in the class action. In that order, issued on March 12, Selna found that Toyota had waived its right to compel arbitration in most those claims because it waited too long and that the dealerships, not Toyota, had the right to enforce arbitration provisions in the rest of the cases.
The other appeal, regarding standing, completed briefing on April 10, but no oral argument has been scheduled so far.
Contact Amanda Bronstad at firstname.lastname@example.org.