Nguyen v. Nissan N. Am., Inc.

• Citation: 487 F.Supp.3d 845
• Decision Date: 13 September 2020
• Docket Number: Case No. 16-CV-05591-LHK
• Parties: Huu NGUYEN, Plaintiff, v. NISSAN NORTH AMERICA, INC., Defendant.
• Court: U.S. District Court — Northern District of California

487 F.Supp.3d 845

Huu NGUYEN, Plaintiff,

v.NISSAN NORTH AMERICA, INC., Defendant.

Case No. 16-CV-05591-LHK

United States District Court, N.D. California, San Jose Division.

Signed September 13, 2020

Ryan Hung-Hsi Wu, Cody Robert Padgett, Robert Kenneth Friedl, Trisha Kathleen Monesi, Steven R. Weinmann, Tarek H. Zohdy, Capstone Lawyers, APC, Jordan L. Lurie, Pomerantz LLP, Los Angeles, CA, for Plaintiff.

Paul Jeffrey Riehle, Matthew Jacob Adler, Faegre Drinker Biddle & Reath LLP, San Francisco, CA, Adam Johnson Thurston, Zoe K. Wilhelm, Faegre Drinker Biddle & Reath LLP, Los Angeles, CA, E. Paul Cauley, Jr., Sherman Vance Wittie, Pro Hac Vice, Faegre Drinker Biddle & Reath, LLP, Dallas, TX, for Defendant.

ORDER DENYING MOTION FOR CLASS CERTIFICATION

Re: Dkt. No. 63

LUCY H. KOH, United States District Judge

Plaintiff Huu Nguyen ("Plaintiff") brings the instant suit against Defendant Nissan North America, Inc. ("Nissan") for causes of action arising out of Nissan's allegedly deceptive sale of vehicles containing a defective manual transmission. Plaintiff moves to certify two classes of individuals who purchased vehicles containing the defective transmission. In connection with the motion for class certification, Plaintiff and Nissan each filed a Daubert motion to exclude expert evidence. Having considered the submissions of the parties, the relevant law, and the record in this case, the Court DENIES Plaintiff's motion for class certification. As a result, the Court DENIES as moot the Daubert motions.

I. BACKGROUND

A. Factual Background

Plaintiff seeks to represent a class of consumers who purchased or leased any Nissan vehicle equipped with the FS6R31A manual transmission. ECF No. 35 ("FAC") ¶ 1. These vehicles include the Nissan 350Z, model years 2007–2009; the Nissan 370Z, model years 2009–2015; the Infiniti G35, model years 2007–2008; the Infiniti G37, model years 2008–2014; and the Infiniti Q60 (hereafter, "Class Vehicles"). Id.

1. The Clutch Assembly Defect

The FS6R31A manual transmission in Class Vehicles uses a hydraulic clutch system. Id. ¶ 8. In a hydraulic clutch system, when the driver depresses the clutch pedal, "fluid pushes from the clutch master cylinder to the slave cylinder, developing hydraulic pressure and ultimately disconnecting the transmission from the engine via the clutch disc to allow for smooth gear shifts." Id. The FS6R31A manual transmission utilizes a concentric (or internal) slave cylinder ("CSC"), as opposed to an external slave cylinder. Id. The CSC is "placed inside the [bellhousing] unit along with the clutch disc, pressure plate, and flywheel." Id.

Plaintiff alleges that the FS6R31A manual transmission in Class Vehicles suffers from "a design flaw in the slave cylinder assembly." Id. ¶ 12. Specifically, Plaintiff alleges that the CSC is composed of materials, including plastic, which do not effectively transfer heat. Declaration of Michael Stapleford ("Stapleford Decl.") at 7, 19; see also Declaration of Karen Wallace ("Wallace Decl."), Ex. 1, Deposition of James Blenkarn ("Blenkarn Dep.") at 77:9–19. This can lead the clutch system's hydraulic fluid to begin boiling as it circulates through the CSC. Stapleford Decl. at 6–7, 18. As the hydraulic fluid boils, air bubbles form and collapse, which causes the fluid pressure to drop suddenly and prevents the CSC from working properly. Stapleford Decl. at 7; Blenkarn Dep. at 65:15–66:3. Moreover, as the air bubbles form and collapse, the imploding effect of the liquid can erode solid surfaces and release debris into the hydraulic fluid. Stapleford Decl. at 7.

This alleged design flaw in the Class Vehicles’ CSCs causes "the clutch to lose hydraulic pressure and fail to engage/disengage gears." FAC ¶ 10. This "causes unsafe conditions, including drivers’ inability to shift gears or maneuver the clutch pedal in the Class Vehicles, thereby rendering the vehicles unable to accelerate and decelerate, often while the vehicles are already in motion." Id. Plaintiff at times describes this issue using the shorthand of a "sticky clutch." See, e.g. , ECF No. 63 at 7, 9.

2. Nissan's Knowledge of the Defect

According to Plaintiff, Nissan "knew or should have known" about the CSC defect "[d]ating back to at least 2008." Id. ¶ 15, 49. Plaintiff alleges that consumers filed complaints with the National Highway Traffic Safety Administration ("NHTSA") regarding the 2007 Nissan 350Z as early as June 2007, and that beginning at least in 2008 Nissan began investigating clutch pedal malfunctions in Class Vehicles. FAC ¶¶ 51–52 (excerpting consumers’ complaints to NHTSA about clutch malfunctions from 2007 onwards); Wallace Decl., Ex. 9 (email exchange suggesting investigation into clutch problems beginning in 2008); see Exs. 7–8 (internal reports from 2009 onwards concerning Nissan's investigation clutch problems).

Nissan responded to complaints about the Class Vehicles’ clutches by exchanging the hydraulic fluid previously used in newly manufactured Class Vehicles to a hydraulic fluid formulated for higher temperatures, and by issuing a series of service bulletins instructing technicians to do the same for previous model years. Wallace Decl., Exs. 2–3, 14–15 (technical service bulletins); Blenkarn Dep. at 45:9–17; 65:10–14. The service bulletins required technicians to first verify that the CSC was not leaking, the only other root cause of the clutch problems suggested. See Blenkarn Dep. at 66:8–24; Wallace Decl., Ex. 14 (technical service bulletin). Plaintiff alleges that this confirmed for Nissan that the problem was heat-related. Mot. at 10; see Blenkarn Dep. at 65:10–18 (testifying the hydraulic fluid was changed "[f]or better temperature characteristics" because there was "an issue with DOT 3 [the previous hydraulic fluid] boiling").

Plaintiff therefore alleges that "Nissan knew about and concealed the Clutch Assembly Defect present in every Class Vehicle" from Plaintiff and other class members "at the time of sale, lease, and repair and thereafter." FAC ¶ 24. "[I]nstead of repairing the defects in the Manual Transmission, Nissan either refused to acknowledge [the defects’] existence or performed repairs that simply masked the defects." Id.

3. Plaintiff Huu Nguyen

Plaintiff is a California citizen. Id. ¶ 27. On January 20, 2012, Plaintiff purchased a new 2012 Nissan 370Z vehicle from Stevens Creek Nissan in Santa Clara County, as a college graduation present for his son, Michael Nguyen ("Michael"). Id. ¶ 28; Declaration of Michael J. Stortz ("Stortz Decl."), Ex. A, Deposition of Huu Nguyen ("Nguyen Dep.") at 20:7–21:22. On March 25, 2014, Michael was driving the 370Z on the freeway when the clutch pedal lost pressure and did not return from its depressed position. See Stortz Decl., Ex. B., Deposition of Michael Nguyen ("Michael Dep.") at 28:2–4; 28:20–29:11, 29:5–14. Michael then took the 370Z to a Nissan dealership, which replaced the CSC at no charge because the vehicle was still under warranty. Id. at 29:22–30:2, 35:22–36:7. On February 6, 2016, Michael experienced a similar problem. FAC ¶ 33. At this point, the 370Z was no longer under warranty. Michael Dep. at 43:24–45:11. Michael therefore took the vehicle to Imperial Motor Sports, where the CSC was replaced at a cost of $721.75. FAC ¶ 33.

B. Procedural History

1. Initial Case History

Plaintiff filed a class action complaint against Nissan on September 30, 2016. ECF No. 1. Plaintiff's original complaint sought to represent all persons in the United States who purchased or leased a 2009–2016 Nissan 370Z. ECF No. 1, at ¶ 1. Plaintiff alleged five causes of action against Nissan: (1) violations of California's Consumers Legal Remedies Act ("CLRA"); (2) Violations of California's Unfair Competition Law ("UCL"); (3) Breach of Implied Warranty pursuant to the Song-Beverly Consumer Warranty Act ("Song-Beverly Act"); (4) Breach of Implied Warranty pursuant to the Magnuson-Moss Warranty Act ("Magnusson-Moss Act"); and (5) Unjust Enrichment. See ECF No. 1.

On December 14, 2016, Nissan filed a motion to dismiss, which argued Plaintiff's equitable relief claims should be dismissed because Plaintiff had adequate remedies at law. ECF No. 19 at 7. On January 25, 2017, the parties stipulated to allow Plaintiff to file an amended complaint. ECF No. 32. The Court granted the parties’ stipulation that same day, and the Court denied as moot Nissan's motion to dismiss the original complaint. ECF No. 33.

On February 1, 2017, Plaintiff filed the First Amended Complaint ("FAC"). See FAC. In the FAC, Plaintiff added the following vehicles to the proposed class: 2007–2009 Nissan 350Z, 2007–2008 Infiniti G35, the 2008–2014 Infiniti G37, and the Infiniti Q60. Plaintiff's FAC also added allegations in support of Plaintiff's claims for equitable relief. See id. at 66–78. Plaintiff's FAC alleged the same five causes of action against Nissan that Plaintiff alleged in the original complaint.

On February 22, 2017, Nissan moved to dismiss the FAC's equitable claims. ECF No. 36. On April 11, 2017, the Court granted Nissan's motion to dismiss the FAC's equitable claims. ECF No. 41. Specifically, the Court dismissed Plaintiff's UCL claim, Plaintiff's unjust enrichment claim, and Plaintiff's claim for injunctive relief under the CLRA. Id. at 9–10. Thus, Plaintiff was left with damages claims based on Plaintiff's causes of action under the CLRA, the Song-Beverly Act, and the Magnusson-Moss Act. See id.

On December 15, 2017, Plaintiff filed the instant motion for class certification.¹ ECF No. 63 ("Mot."). Plaintiff seeks to certify the following proposed classes:

• Class: All individuals in California who purchased or leased, from an authorized Nissan dealer, a new Nissan vehicle equipped with a FS6R31A manual transmission.

• CLRA Sub-Class: All members of the Class who are "consumers" within the meaning of California Civil Code § 1761(d).

Id. at 13.² On February 5, 2018, Nissan filed its opposition. ECF No. 76 ("Opp."). On March 2, 2018, Plaintiff filed...