164 F.R.D. 529 (D.Kan. 1995), 88-2202-EEO, Commander Properties Corp. v. Beech Aircraft Corp.

Docket Nº88-2202-EEO.
Citation164 F.R.D. 529
Opinion JudgeEARL E. O'CONNOR, District Judge.
Party NameCOMMANDER PROPERTIES CORP., Individually and on behalf of all others similarly situated, Plaintiff, v. BEECH AIRCRAFT CORP. and Raytheon Company Corp., Defendants.
AttorneyStewart M. Stein, Buck, Bohm & Stein, P.C., Leawood, KS, Edward P. Yankelunas, Linda H. Joseph, James R. Arnone, Randy C. Rucinski, Jaeckle, Fleischmann & Mugel, Buffalo, NY, for plaintiff. Paul B. Swartz, Terry L. Malone, William Robert Martin, Martin, Pringle, Oliver, Wallace & Swartz, Wichita,...
Case DateDecember 05, 1995
CourtUnited States District Courts, 10th Circuit, District of Kansas

Page 529

164 F.R.D. 529 (D.Kan. 1995)

COMMANDER PROPERTIES CORP., Individually and on behalf of all others similarly situated, Plaintiff,

v.

BEECH AIRCRAFT CORP. and Raytheon Company Corp., Defendants.

No. 88-2202-EEO.

United States District Court, D. Kansas.

December 5, 1995

As Corrected, Nunc Pro Tunc April 8, 1996.

Owner of airplane brought action against manufacturer to recover expenses incurred due to wing joint problem, asserting claims of RICO, breach of express warranty, breach of implied warranty of merchantability, fraud, unjust enrichment, and conspiracy to defraud, and filed motion for certification of class of original owners of airplanes. The District Court, Earl E. O'Connor, J., held that issues of individual members of putative class predominated over issues common to members of class.

Motion denied.

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Stewart M. Stein, Buck, Bohm & Stein, P.C., Leawood, KS, Edward P. Yankelunas,

Page 531

Linda H. Joseph, James R. Arnone, Randy C. Rucinski, Jaeckle, Fleischmann & Mugel, Buffalo, NY, for plaintiff.

Paul B. Swartz, Terry L. Malone, William Robert Martin, Martin, Pringle, Oliver, Wallace & Swartz, Wichita, KS, Reed O. Gentry, Robert R. Barton, Field, Gentry & Benjamin, P.C., Kansas City, MO, for defendants.

MEMORANDUM AND ORDER

EARL E. O'CONNOR, District Judge.

This matter is before the court on the motion of plaintiff Commander Properties Corporation (" Commander" ) for class action certification (Doc. # 225) and the related motion by defendants Beech Aircraft Corporation (" Beech" ) and Raytheon Company Corporation (" Raytheon" ) to strike certain affidavits filed in support of Commander's motion for certification (Doc. # 234). Commander seeks certification of its complaint as a class action pursuant to Federal Rule of Civil Procedure 23(a) and 23(b)(3). Defendants oppose class action certification. The parties have fully briefed the certification motion and the court held a hearing on the motion September 22, 1995. For the reasons set forth below, Commander's motion for class action certification will be denied and defendants' motion to strike will be granted in part.

Factual Background

On April 14, 1988, Commander filed the instant action individually, and on behalf of a class of others similarly situated, to recover alleged damages relating to the design of the wing structure of King Air aircraft models 90 and 100. " King Air" refers to a class of turbine-powered, propeller-driven, executive transport airplanes designed and manufactured by defendant Beech. The majority of King Airs are flown by professional pilots, rather than owner-pilots.

In its original complaint, Commander alleged, inter alia, that the wing structure was defective, not airworthy, did not conform to federal aviation regulations, and was in need of a substantial design modification. Because the Federal Aviation Administration (" FAA" ) has primary jurisdiction over aircraft certification and airworthiness and aviation safety standards, the court ordered Commander to pursue an administrative determination from the FAA regarding the airworthiness of the King Air models in question.

Commander filed a complaint with the FAA seeking a determination of whether the Beech wing design was defective and, if so, whether Commander's proposed wing modification would remedy the defective condition and make the aircraft airworthy. On July 2, 1991, and April 2, 1992, the FAA issued opinions on the issues raised in Commander's complaint. The April 2, 1992, FAA opinion dismissing Commander's complaint provided, in pertinent part, as follows:

The Beech wing design is not defective in terms of its structural strength so long as the airworthiness directives (ADs) are complied with and the aircraft is flown within its approved flight envelope....

Over the life of the King Air aircraft the manufacturer has corrected problems such as stress corrosion of bolts, or manufacturing defects leading to cracking of Inconel nuts in the lower forward spar attachments, that might have had an effect on the integrity of the wing structure of each type of King Air. Some of these corrections have been made mandatory by the issuance of ADs by the FAA. None of the problems addressed by the manufacturer or by ADs are the result of inadequate design or strength testing of the wing structure.

Commander sought review of the FAA's dismissal of its complaint in the United States Court of Appeals for the District of Columbia Circuit. Commander argued that in determining that the aircraft were not " defective," the FAA exceeded its authority in that it rendered a judgment on Commander's common law claims. The court denied review, stating that the FAA decided only whether the aircraft was properly certified and, thus, airworthy. Commander Properties, Inc. v. Federal Aviation Admin., 11 F.3d 204, 206 (D.C.Cir.1994) (as amended). The court said:

In discussing the wing design, the FAA said not a word about the common law. Instead, the agency referred to its regulations

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concerning testing for strength and load requirements and found that the aircraft was " airworthy" (complied with FAA standards), because the past problems had been corrected.

Id. In a footnote to that statement, the court also said:

The FAA referred to the aircraft's current status, not to problems arising after initial certification. The FAA ultimately concluded that the aircraft is not defective ‘ so long as Airworthiness Directives are complied with,’ which presumably means that compliance with the Airworthiness Directives was necessary to bring the aircraft up to the FAA standards.

Id. at n. 3. The court concluded, " Whether Commander is correct that the Airworthiness Directives, increased inspections, and accident reports show that the wing design was ‘ defective’ as a matter of tort law is not for us to say." Id. at 206.

Following the FAA and District of Columbia Circuit Court's action, defendants filed a motion to dismiss, urging that the FAA had determined that the wing design was not defective. Because the FAA determination did not speak to the status of the King Air aircraft post-manufacture and pre-modification (pursuant to FAA ADs), we held that the FAA determination did not resolve plaintiff's claims and denied defendants' motion to dismiss.

This brings us to the instant motion for class action certification by Commander. The claims presently pursued by Commander differ significantly from those originally brought. Commander now seeks to recover the cost of replacing the defective wing bolts, loss of use of the aircraft, and increased inspection costs. As has been true from the beginning, Commander does not claim any damages for personal injury as a result of the allegedly defective design.

Commander's present allegations are that Beech breached express state-of-the-art warranties and implied warranties of merchantability by selling the planes with the defective wing bolts and then failing and refusing to correct the problem. Further, Commander alleges that Beech was unjustly enriched in two ways: (1) by charging King Air owners to perform the inspections and repairs necessitated by the defective design and (2) if not by charging for its own work, by the amounts of money that members of the proposed class paid others to inspect and replace defective bolts, costs which should have been borne by Beech. Finally, Commander alleges that defendants committed fraud and RICO violations by misrepresenting the true safety status of the King Air models at issue in an effort to lull members of the proposed class into not asserting their warranty rights.

Based on these factual allegations, Commander is presently pursuing the following claims: (1) violations of the Racketeer Influenced & Corrupt Organizations Act (" RICO" ), 18 U.S.C. § 1962(c) and (d)1 against defendants Raytheon and Beech (Counts VI and VII respectively) (the only federal claim); (2) breach of express warranty against defendant Beech (Count I); (3) breach of implied warranty of merchantability against defendant Beech (Count II); (4) fraud, deceit, and misrepresentation against defendant Beech (Count IV); (5) unjust enrichment against defendant Beech (Count VIII); and (6) conspiracy to defraud against both defendants (Count XI).2

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Commander's motion for certification describes the proposed class as follows:

All persons who are owners during the time period April 14, 1984 3 to the present of aircraft manufactured by Defendant Beech Aircraft Corp. with the following model and serial numbers:

MODELS SERIAL NUMBERS
65-90, 65-A90, B90 and C90 LJ-1 through LJ-1062
E90 LW-1 through LW-347
100 and A100 B-1 through B-247
B100 BE-2 through BE-137

Expressly excluded from the class are: (1) any King Air aircraft owned by Defendants or any of their affiliates; (2) any proposed class members who own King Air aircraft not subject to regulation by the Federal Aviation Administration; (3) any aircraft manufactured in 1986 or thereafter which utilize an integral attachment fitting; 4 (4) any aircraft purchased before January 1, 1975; and (5) any claims for personal injury damages.

Based on this definition, the " relevant ownership period" would be from June 8, 1981, to the present and the class would include any owner, whether of a new or used plane, within that period. The " relevant purchase period" would be from January 1, 1975, to 1986, when the wing structure design was changed. Discuss...

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