Bechtel v. Fitness Equip. Servs.

Decision Date11 September 2021
Docket Number1:19-cv-726
PartiesLAURA BECHTEL, et al., Plaintiffs, v. FITNESS EQUIPMENT SERVICES, LLC, Defendant.
CourtU.S. District Court — Southern District of Ohio
ORDER

KAREN L. LITKOVITZ, UNITED STATES MAGISTRATE JUDGE

This matter is before the Court on plaintiffs' Motion for Class Certification and to Appoint Class Representatives and Class Counsel (Doc. 37), defendant Fitness Equipment Services, LLC, dba Sole Fitness's (Sole) response in opposition (Doc. 45), and plaintiffs' reply memorandum (Doc. 52). The Court conducted a hearing on this matter on August 16, 2021.

I. Background

Sole manufactures, markets and sells several treadmill models for household use. Sole represents on its website and marketing materials that the treadmills operate at a continuous horsepower (“CHP”) range of 2.5 to 4.0. According to plaintiffs, Sole's treadmills cannot ever reach the advertised CHP in household use because standard residential outlets do not produce the necessary wattage to achieve the stated CHP. Plaintiffs claim that Sole's CHP “misrepresentations” led all Sole treadmill purchasers to overpay for treadmills based on unachievable CHP marketing. Plaintiffs seek to right this alleged wrong via a nationwide class action, including specified subclasses.

Sole on the other hand, declares that its award-winning treadmills produce more than enough horsepower for the vast majority of household users, even if the advertised CHP were not achievable using standard residential outlets. Sole claims it did not misrepresent CHP because even plaintiffs acknowledge that the stated CHP can be achieved in laboratory conditions.

According to Sole, discerning consumers choose a treadmill based on a number of variables, and as long as the treadmills are at least as powerful as the individual user requires, buyers are satisfied with their purchases and suffer no injury. Sole contends that there are too many individual issues, both factually and legally, to warrant a class action.

A. Plaintiffs' Allegations

Sole's marketing and advertising materials prevalently feature a specific CHP for each treadmill model ranging from 2.5 to 4.0. (Doc. 38-2 at PAGEID 382). Dick's Sporting Goods, the largest third-party retailer of Sole treadmills, published a “Pro Tips guide” to the “Top Five Things That Influence the Price of Treadmills” in which it listed CHP as the most important factor. (Doc. 38-7 at PAGEID 432-33).[1]

Plaintiffs allege that Sole's CHP representations are “inaccurate, misleading, and materially overstate the Treadmills' true operating horsepower” because “it is not possible for these Treadmills to operate at a continuous horsepower of 4.0 or even 2.5 continuous horsepower when plugged into a standard 120-volt, 15-amp outlet found in residential homes in the United States.” (Doc. 31 at PAGEID 200). In his report, plaintiffs' expert, Bradley Frustaglio of Yeadon Engineering Services (“YES”), summarized his testing of Sole F80 treadmill motors. (Doc. 38-4).

According to YES, Sole treadmills employ a pulse width modulated (“PWM”) speed control. PWM controls use a series of “ON-OFF” pulses to control the power applied to the motor by varying the fraction of time the output voltage is “ON” compared to the fraction it is “OFF.” (Id. at PAGEID 401-02). Treadmill motors commonly use PWM controllers because they can control belt speed in response to a console speed setting. (Id. at PAGEID 402).

YES tested the installed F80 motor under simulated household use (i.e., powered by a 120-volt line while operated by a 188-pound subject at various speed settings) and tested the motor capability removed from the treadmill using a laboratory DC power supply. (Id. At PAGEID 405-10). Using a dynamometer to measure torque, speed and output power, YES determined that the motor required “over two times the allowable 1800W continuous rating for a 120V/15A circuit” to produce 3.5 horsepower output. (Id. at PAGEID 419). YES ultimately concluded:

After reviewing the various Sole treadmill models and represented CHP capabilities it is my opinion that all Sole treadmills with a DC electric motor and an onboard PWM controller are incapable of producing the continuous horsepower output Sole advertised or marketed to consumers for the F60, F63, F65, F80, F85, S77, TT8 and TT9 treadmills. Testing is not required to confirm as the absolute maximum theoretical CHP is 2.41HP. When PWM control and losses are included . . . the F80 treadmills [sic] maximum horsepower output is 1.775HP and no Sole treadmill can achieve a CHP greater than 2.41 CHP connected to a 120VAC 60Hz 15A household breaker.

(Doc. 38-4 at PAGEID 421).

According to plaintiffs, every person who purchased a treadmill for home use paid a “price premium”[2] for CHP above 2.41 that could not be reached using residential electrical supply. (Doc. 38 at PAGEID 353). Plaintiffs offered reports from two purported damages experts: Colin Weir, an expert economist; and Steven Gaskin, an independent survey expert. (Doc. 38-10; Doc. 38-11). Weir and Gaskin propose using choice-based conjoint (“CBC”) analysis to calculate classwide damages. (Doc. 38-10 at PAGEID 455; Doc. 38-11 at PAGEID 494).

Specifically, Gaskin will design a survey that requires panelists to make various choices and rankings relating to product attributes, prices, and alternatives using randomized order and appearance to avoid focusing the survey on a single attribute. (Doc. 38-10 at PAGEID 458; Doc. 38-11 at PAGEID 498). These “choice sets” will vary by brand, CHP, running surface area, display screen, maximum incline, heart rate monitoring, warranty, and price. (Doc. 38-11 at PAGEID 500). Gaskin intends to conduct a blind internet survey of 300 prescreened respondents who have purchased a treadmill in the last six years. (Id. at PAGEID 504-07).

A statistical analysis is then applied to the survey responses to calculate a specific value for each attribute. (Doc. 38-10 at PAGEID 459). Once the value, if any, attributed to CHP is determined, the number can then be applied to the entire class to determine the price premium damages on a class-wide basis.

B. Defendant's Response

Sole alleges that plaintiffs do not allege any dissatisfaction with how the F80 Sole treadmills actually perform during use, ” and “Sole's treadmills have won accolades, received awards, and obtained high ratings from third-party product reviewers consistently.” (Doc. 45 at PAGEID 589-90). According to Sole, plaintiffs are seeking financial benefit from a problem that exists only in “the highly limited laboratory testing conducted by Plaintiffs' treadmill motor expert.” (Id. at PAGEID 590).

Sole retained its own expert, Adam Bainbridge from S-E-A Investigation, Research and Testing (“SEA”). (Doc. 45-1). In addition to identifying perceived problems with YES's testing, SEA concluded:

There has been no evidence presented to S-E-A to indicate that users of Sole treadmills are not receiving the necessary motor power output to meet the various demands of their individual workouts. Power usage will always be dependent on the specific weight and running style of a user. The maximum motor horsepower output for a treadmill application would occur at the top speed setting and maximum-rated user weight; therefore, the overwhelming majority of treadmill users would not be impacted by the upper bounds of the motor nameplate rating because the majority of users would not operate the device at the maximum speed and weight rating. It would be expected that most users could operate through the range of the machine while staying well below the limits of the motor. A treadmill is designed to assure that appropriate power is available to every user up to the maximum speed and rated weight of the device.

(Doc. 45-1 at PAGEID 628-29). SEA further stated that a “motor nameplate rating of ‘3.5 CHP,' (sic) does not imply that the motor will always or ever deliver that much power, (sic) it is simply the upper threshold of treadmill-duty loading the motor can sustain without incurring damage, ” and both YES's and SEA's testing establish that the motors can reach the rated value “under constant loading with a DC power supply.” (Id. at PAGEID 629).

Sole also retained a damages expert, Keith Ugone, who concluded that plaintiffs' proposed CBC analysis would not measure the “claimed ‘reduction in market value' (i.e., a price premium) but instead “measures a difference in ‘willingness-to-pay.' (Doc. 45-2 at PAGEID 668). According to Ugone, “damages associated with allegations of deceptive labeling would be equal to the difference in the price that putative Class members paid for the Challenged Products (i.e., actual prices) and the price putative Class members would have paid in the absence of the alleged misrepresentation (i.e., in the ‘but-for-world'), if such a difference exists.” (Id. At PAGEID 681). Ugone reports that damages rely on both demand side (a consumers' willingness to pay) and supply side (producers' willingness to sell) considerations, and the proposed CBC analysis evaluates only the demand side of the equation. (Id. at PAGEID 682).[3]

C. Class Certification Requested

Plaintiffs seek to certify the following classes (as modified in plaintiffs' reply brief and at oral argument):

Ohio Class: All persons in Ohio who purchased a Sole F63 (3.0 CHP), Sole F65 (3.25 CHP), Sole S77 (4.0 CHP), Sole F80 (3.5 CHP), Sole F85 (4.0 CHP), Sole TT8 (4.0 CHP), Sole F60 (2.75 CHP), Sole S73 (3.0 CHP), Sole F83 (3.25 CHP), and/or Sole TT9 (4.0 CHP) treadmill from August 30, 2015 through class certification, primarily for personal family, or household purposes, and not for resale. (Breach of express warranty and Magnuson-Moss Warranty Act breach of express warranty).
Ohio Class
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