Cohen v. Subaru of Am., Inc.
| Decision Date | 10 March 2022 |
| Docket Number | 1:20-cv-08442-JHR-AMD |
| Parties | GILLES COHEN, JOHN MICKLO, MUHAMMAD ADNAN, DONNY WOO, BENJAMIN MOORE, MARY LOU PLANTE, MEREDITH MEIN DE VERA, DAN ROSENTHAL, IGOR KRAVCHENKO, ALEXANDRA EFANTIS, BLAISE FONTENOT, KATHERINE MUTSCHLER, JACQUELINE FERGUSON, BENJAMIN CHRISTENSEN, JENNIFER LILLEY, STEVEN BIONDO, CHANTEL NELSON, JACQUELINE BROCKMAN, MARTY BROWN, CHRISTINE KING, and KEVIN KING, individually and on behalf of all others similarly situated, Plaintiffs, v. SUBARU OF AMERICA, INC., et al. Defendants. Fraud/Deception Claims Against Denso Additional Claims Against Denso |
| Court | U.S. District Court — District of New Jersey |
This matter is before the Court on the motion to dismiss filed by Defendant Denso International America, Inc. (“Denso”). [Dkt. 78-1]. For the reasons set forth below, the Court will grant Denso's motion in part and deny Denso's motion in part. A summary of the Court's findings is available in Appendix A to this opinion.
As detailed in the procedural history section below, this case results from the consolidation of four separate putative class action lawsuits filed against Denso, its parent company Denso Corporation, [1] and its co-defendants Subaru of America Inc. and Subaru Corporation.[2] Plaintiffs in this case are thirty-four individuals who purchased or leased Subaru vehicles manufactured between 2013 and 2019. The following table identifies Plaintiffs, their states of residence, the year and model of their Subaru vehicle, and the states where they purchased or leased their vehicles:
Plaintiff
Model
Model Year
Resident State
State of Purchase or Lease
Plaintiff
Model
Model Year
Resident State
State of Purchase or Lease
While the CAC contains other facts relevant to each Plaintiff's claims, the Court will discuss those facts in the analysis section as necessary to decide Denso's motion.
Plaintiffs allege that their Subaru vehicles-and all Subaru vehicles manufactured since 2013-contain defective low-pressure fuel pumps[3] manufactured by Denso. [CAC ¶¶ 1, 14]. According to the CAC, these fuel pumps contain an impeller[4] that is “unsuitable for its environment” because it was produced using a “low density material.” [CAC ¶¶ 199, 204]. Because of this “low density material, ” the impellers can absorb excessive amounts of fuel, become deformed, and fail to adequately pump fuel from the fuel tank to the engine. [CAC ¶¶ 199-209]. According to the CAC Subaru vehicles containing the defective fuel pump are “unsafe to operate because [the vehicles] will not predictably respond to operator input to accelerate and … could stall or completely lose power while in motion.” [CAC ¶ 1]. The Court will refer to this issue of inadequate impeller materials as alleged in the CAC as the “Defect.”
Plaintiffs allege that they have suffered economic injuries as a result of the Defect, but do not allege that the Defect caused physical harm to them or anyone else, or that the Defect caused damage to any other property.[5] a. Recalls
Subaru and Denso commenced a series of recalls concerning fuel pump impellers with the National Highway Traffic Safety Administration (“NHTSA”).[6] On April 16, 2020, Subaru initiated a recall which applied to more than 188, 000 Subaru Impreza, Outback, Legacy, and Ascent model vehicles from model year 2019 (the “Subaru Recall”). [CAC ¶ 9]. The report announcing the recall (the “Subaru Recall Report”) stated in part:
The affected vehicles may be equipped with a low pressure fuel pump produced during a specific timeframe which includes an impeller that was manufactured with a lower density. If the surface of the lower density impeller is exposed to solvent drying for longer periods of time, it may develop fine cracks. Those cracks may lead to excessive fuel absorption, resulting in impeller deformation. Over time, the impeller may become deformed enough to interfere with the body of the fuel pump, potentially causing the low pressure fuel pump to become inoperative.
[CAC Ex. C]. As this excerpt demonstrates, the Subaru Recall attributes the Defect not just to the impeller's material density but to the combination of low density and excessive exposure to “solvent drying.” [Id.]. The CAC alleges that Subaru mischaracterizes the nature of the Defect, by qualifying the Defect in this manner. [CAC ¶ 204].
As a remedy, the Subaru Recall states that “[f]or all of the potentially affected vehicles, Subaru dealers will replace the low pressure fuel pump … with an improved part at no cost” (the “Recall Repair”). [CAC Ex. C at 7]. The Subaru Recall also states that Subaru “began using the fuel pump with filter with a higher density impeller [sic]” as of July 2019. [Id.]. However, the CAC alleges that Subaru's efforts are inadequate. [CAC ¶ 17]. According to the CAC, Subaru does not replace the low-pressure fuel pump, but only replaces the fuel pump's motor which houses the defective impeller. [Id.]. Subaru replaces the motor alone because Denso “provided only the defective fuel pump motor, and not the entire fuel pump module” to Subaru in an effort to cut costs. [CAC ¶ 222 (emphasis in original)]. Plaintiffs allege that this repair deviates from the industry standard practice of replacing the fuel pump entirely.[7] [Id.]. It also requires technicians to deconstruct the fuel pump assembly which risks damaging the assembly, causing gas leaks, “creating additional hazards, ” and “exacerbating the Fuel Pump Defect instead of correcting it.” [Id.]. The CAC further alleges that “Subaru failed to train technicians on the complicated procedures required to adequately” and safely repair the fuel pump assembly. [CAC ¶ 235]. Plaintiffs cite several complaints filed with the NHTSA by non-Plaintiff Subaru owners who received the Recall Repair but experienced subsequent performance issues with their vehicles. [CAC ¶ 239 n.34].
On April 27, 2020, Denso issued a recall for 2, 020, 000 fuel pumps that it manufactured between September 1, 2017 and October 6, 2018 (“Denso Recall I”). [CAC ¶ 4]. Denso Recall I stated, in part, that the fuel pumps contain a defective impeller that “could render the fuel pump inoperable.” [CAC ¶ 5]. The recall report that accompanied Denso Recall I (“Recall Report I”) identified two potential issues with its impellers, stating that if “an impeller is manufactured with a lower density, and [1] contains a lower surface strength or [2] is exposed to production solvent drying for a longer period of time, higher levels of surface cracking may occur which, when excessive fuel absorption occurs, may result in impeller deformation.”[8] [CAC ¶ 5]. On June 11, 2020, Denso expanded the recall to cover 2, 156, 057 affected fuel pumps (“Denso Recall II”). [Dkt. 7]. On November 17, 2020, Denso again expanded its recall to include 1, 517, 721 additional fuel pumps manufactured between June 26, 2017 and June 28, 2019 (“Denso Recall III). [CAC ¶ 15].
According to Plaintiffs, these recalls do not capture all Subaru vehicles affected by the Defect. The CAC alleges that “this defect has existed in Subaru vehicles since at least 2013, ” and that other car manufacturers containing the same defective fuel pumps have recalled vehicles as early as model year 2013. [CAC ¶ 14].
b. Knowledge and Marketing
The CAC alleges that a 2016 patent application [the “Patent Application”] demonstrates that Denso knew of the Defect before Subaru or Denso initiated recalls:
In a patent application filed in 2016 Denso admitted that the composite (plastic) impellers in its low-pressure fuel pumps “may be swelled due to the fuel and water contained in the fuel, [and] therefore a rotation of the impeller may be stopped when the impeller is swelled and comes in contact with the [fuel pump] housing.” The defect described by the patent application is virtually the same as the Fuel Pump Defect at the heart of this case.
[CAC ¶ 211].
The CAC alleges that consumer complaints filed with the NHTSA “reveal that the fuel pump defect poses serious safety risks.” [CAC at 74 (capitalization omitted)]. The CAC lists complaints that document engine performance issues in Subaru vehicles consistent with symptoms of the Defect as early as 2017. [CAC ¶¶ 243-85].
The CAC also alleges that Denso markets itself as a manufacturer of safe and reliable products. [CAC ¶ 310]. The CAC points to representations on Denso's website...
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