687 F.3d 583 (3rd Cir. 2012), 11-1192, Marcus v. BMW of North America, LLC

Docket Nº:Bridgestone Americas Tire Operations, LLC, f/k/a Bridgestone Firestone North American Tire, LLC; Bridgestone Corporation, Appellants ( 11-1192)
Citation:687 F.3d 583, 83 Fed.R.Serv.3d 246
Opinion Judge:AMBRO, Circuit Judge.
Party Name:Jeffrey MARCUS, Individually and On Behalf of All Others Similarly Situated v. BMW OF NORTH AMERICA, LLC; Bridgestone Americas Tire Operations, LLC, f/k/a Bridgestone Firestone North American Tire, LLC; Bridgestone Corporation
Attorney:Hugh R. Whiting, Esq., [Argued], Dustin B. Rawlin, Esq., Jones Day, Cleveland, OH, Counsel for Appellant, Bridgestone Corporation. Susan T. Dwyer, Esq., Herrick Feinstein LLP, New York, NY, Ronald J. Levine, Esq., David R. King, Esq., Herrick Feinstein LLP, Princeton, NJ, Counsel for Appellant, B...
Judge Panel:Before: AMBRO, CHAGARES, and ALDISERT, Circuit Judges.
Case Date:August 07, 2012
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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Page 583

687 F.3d 583 (3rd Cir. 2012)

83 Fed.R.Serv.3d 246

Jeffrey MARCUS, Individually and On Behalf of All Others Similarly Situated

v.

BMW OF NORTH AMERICA, LLC; Bridgestone Americas Tire Operations, LLC, f/k/a Bridgestone Firestone North American Tire, LLC; Bridgestone Corporation

Bridgestone Americas Tire Operations, LLC, f/k/a Bridgestone Firestone North American Tire, LLC; Bridgestone Corporation, Appellants (No. 11-1192)

BMW of North America, LLC, Appellant (No. 11-1193).

Nos. 11-1192, 11-1193.

United States Court of Appeals, Third Circuit.

August 7, 2012

Argued Sept. 20, 2011.

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Hugh R. Whiting, Esq., [Argued], Dustin B. Rawlin, Esq., Jones Day, Cleveland, OH, Counsel for Appellant, Bridgestone Corporation.

Susan T. Dwyer, Esq., Herrick Feinstein LLP, New York, NY, Ronald J. Levine, Esq., David R. King, Esq., Herrick Feinstein LLP, Princeton, NJ, Counsel for Appellant, Bridgestone Americas Tire Operations, LLC.

Rosemary J. Bruno, Esq., Christopher J. Dalton, Esq., [Argued], Buchanan Ingersoll & Rooney, Newark, NJ, Counsel for Appellant, BMW of North America, LLC.

Karin E. Fisch, Esq., [Argued], Orin Kurtz, Esq., Abbe, Spanier, Rodd & Abrams LLP, New York, NY, Alan E. Sash, Esq., Steven J. Hyman, Esq., McLaughlin & Stern, LLP, New York, NY, Counsel for Appellee, Jeffrey Marcus.

Before: AMBRO, CHAGARES, and ALDISERT, Circuit Judges.

OPINION

AMBRO, Circuit Judge.

Table of Contents
I. Factual and Procedural Background 588
II. Jurisdiction and Standard of Review 590
III. Preliminary Matters 590
A. The Class Definition and the Claims to be Given Class Treatment 591
B. Ascertainability 592
IV. Rule 23(a) 594
A. Numerosity 594
B. Commonality 597
C. Typicality 597
V. Rule 23(b)(3): Predominance 600
A. The Common Law Claims 600
1. Common Proof of Susceptibility to Road Hazard Damage 601
2. Common Proof of Proximate Causation 603
B. The New Jersey Consumer Fraud Act Claim 605
VI. Conclusion 612
Page 588 This class action involves run-flat tires (" RFTs" ). As their name suggests, they can " run" while " flat." Even if an RFT suffers a total and abrupt loss of air pressure from a puncture or other road damage, the vehicle it is on remains stable and can continue driving for 50 to 150 miles at a speed of up to 50 miles per hour. Jeffrey Marcus leased a BMW convertible equipped with four Bridgestone RFTs. Unfortunately, he experienced four " flat" tires during his three-year lease. In each case, the RFT worked as intended. Even though the tire lost air pressure, Marcus was able to drive his car to a BMW dealer to have the tire replaced. Unsatisfied nonetheless, Marcus sued Bridgestone Corporation, Bridgestone Americas Tire Operations, LLC (" BATO" ) (together " Bridgestone" ), and BMW of North America, LLC (" BMW" ), asserting consumer fraud, breach of warranty, and breach of contract claims. Among other things, he claims that Bridgestone RFTs are " defective" because they: (1) are " highly susceptible to flats, punctures and bubbles, and ... fail at a significantly higher rate than radial tires or other run-flat tires; " (2) cannot be repaired, only replaced, " in the event of a small puncture; " and (3) are " exorbitantly priced." J.A. 91, 100, 102. He also claims RFT-equipped BMWs cannot be retrofitted to operate with conventional, non-run-flat tires, and that " many service stations do not sell" Bridgestone RFTs, making them difficult to replace. J.A. 91, 92. He faults BMW and Bridgestone for failing to disclose these " defects." The District Court certified Marcus's suit under Federal Rule of Civil Procedure 23(b)(3) as an opt-out class action brought on behalf of all purchasers and lessees of certain model-year BMWs equipped with Bridgestone RFTs sold or leased in New Jersey with tires that " have gone flat and been replaced." For the reasons that follow, we part from the District Court. Among other problems, on the record before us, Marcus's claims do not satisfy the numerosity and predominance requirements. We thus vacate the District Court's certification order and remand for proceedings consistent with this opinion. I. FACTUAL AND PROCEDURAL BACKGROUND In July 2007, Jeffrey Marcus (a New York resident) leased a 2007 BMW 328ci from an authorized BMW dealership in Ramsey, New Jersey. The convertible first caught his eye at another dealership in South Hampton, New York. He saw the car on the showroom floor and, interest piqued, picked up a brochure. Aside from visiting the dealership, picking up the brochure, and riding in a friend's 328ci as a passenger, Marcus claims he " absolutely [did] not" do any other research on BMW vehicles or RFTs before leasing his car. J.A. 875. As noted, Marcus suffered four " flat" 1 tires during his three-year lease. Each time he experienced a flat, he drove his car to a BMW dealership in New York and had the tire replaced. BMW then billed Marcus between $350 to $390 for parts, labor, fees, and taxes. See J.A. 407-11. After his first flat, Marcus purchased a road-hazard warranty for about $400, which covered at least some of the replacement costs for flat tires two through four. See J.A. 880. Marcus's first two flat tires were not available for inspection in this lawsuit. Page 589 Dealer records show that a nail punctured the first tire and the second was replaced due to a " blown out bubble." J.A. 407-08. Marcus's third tire was replaced because he ran over a chunk of metal " the size of a finger," according to his own expert, and his fourth because he ran over another sharp object that tore and gouged the tire and damaged the sidewall. J.A. 300. The parties' experts agree that the third and fourth tires could not have been repaired, and that any tire (run-flat or conventional) would have been damaged, if not destroyed, under the circumstances. See J.A. 300, 414-15. They also agree on two other, more general propositions: (1) a tire can " go flat" or fail for a wide variety of reasons and not be a " defective" tire; and (2) to determine properly and accurately the cause of any particular tire failure, a careful and thorough examination of that tire is necessary. See J.A. 305, 399, 1476-77. The parties dispute what Marcus knew about RFTs and RFT-equipped BMWs before leasing his car and, more importantly, what other purchasers and lessees could have known. To " provide a market and consumer perspective" on RFTs and BMWs, BMW presented the expert report and testimony of William Pettit. See J.A. 1761-76. He concluded that " [a]n abundance of [RFT] information exists in the public domain extolling the safety and convenience benefits and discussing potential downsides." J.A. 1769. He pointed to BMW and Bridgestone documents ( e.g., their press releases and marketing brochures), as well as information from the public domain ( e.g., articles in publications like Consumer Reports, BusinessWeek, The Wall Street Journal, and The New York Times ). To take but a few examples, BMW boasts in its brochures that " should you get a flat, you can still travel up to 150 miles at 50 mph, thanks to [the 2007 BMW 3 Series Convertible's] standard run-flat tires," J.A. 329, " so you can drive off a busy highway, out of a dangerous area, or just continue on your journey on a rainy night," J.A. 1108. In several other places, its brochures mention that the car comes equipped with RFTs and that, " [d]ue to low-profile tires, wheels, tires and suspension parts are more susceptible to road hazard and consequential damages." J.A. 366, 374, 377, 380. A warning about road hazard susceptibility also appears in Bridgestone's tire warranty— " low aspect ratio tires, with reduced sidewall height, may be more susceptible to damage from potholes, road hazards, and other objects such as curbs" — as well as in BMW press releases from July 2006 and March 2007. See J.A. 577, 579, 580, 993, 1449. In addition, the BMW Owner's Manual for the 328i warns drivers that, " [f]or safety reasons, BMW recommends that damaged Run-Flat Tires be replaced rather than repaired." J.A. 1558. BMW's " Approved Tires" brochure similarly advises consumers that " [w]hile some tire manufacturers will allow tire repairs, BMW only recommends replacement of damaged tires." J.A. 1092. BMW and Bridgestone also highlight information from the public domain. An April 2006 Business Week article says, " Run-flat tires aren't cheap. Four Bridgestone Blizzak Run-Flats cost about $1,200, compared with perhaps $500 to $800 for comparable conventional tires." J.A. 762. Sounding a similar note, an article from the June 2007 Consumer Reports mentions that some RFT owners have complained about " limited replacement choices" and " high replacement costs." J.A. 961. However, this report concludes that " [d]espite the disadvantages and inconveniences of...

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