Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_03-cv-02628/USCOURTS-cand-4_03-cv-02628-0/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1332 Diversity-Fraud

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United States District Court

For the Northern District of California

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1 Plaintiffs also object to the evidence offered by

Defendant’s experts. See Docket No. 290, Objections by the

Plaintiff Class to Evidence Offered by Defendant Ford Motor

Company on its Motion for Summary Judgment. To the extent that

the Court relies upon evidence to which Plaintiffs object, their

objections are overruled. To the extent that the Court does not

rely on such evidence, Plaintiffs' objections are overruled as

moot. 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SUSAN CHAMBERLAN; BRIAN CHAMPINE;

and HENRY FOK, on behalf of 

themselves and all others similarly

situated, and on behalf of the 

general public,

Plaintiffs,

v.

FORD MOTOR COMPANY, and DOES 1

through 100, inclusive,

Defendants.

 /

No. C 03-02628 CW

ORDER GRANTING IN

PART AND DENYING

IN PART 

DEFENDANT'S 

MOTION 

FOR SUMMARY

JUDGMENT AND

GRANTING

DEFENDANT'S

MOTION FOR

PARTIAL JUDGMENT

ON THE PLEADINGS

Defendant Ford Motor Company moves for summary

adjudication of all claims brought by Plaintiffs Susan

Chamberlan and Henry Fok, on behalf of themselves and others

similarly situated (collectively, Plaintiffs). In the

alternative, Defendant seeks summary adjudication of the claims

of certain subsets of the class. Defendant also moves for

judgment on the pleadings of Plaintiffs’ UCL claims on behalf of

the general public. Plaintiffs oppose these motions.1 

The matters were heard on March 18, 2004. Having

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2 The automobiles at issue include Mercury Grand Marquis

(1996-2001), Ford Mustang (1996-2001), Ford Explorer (2002),

Ford Crown Victoria (1996-2001), Lincoln Town Car (1996-2001),

Mercury Cougar (1996-1997), and Ford Thunderbird (1996-1997).

2

considered all of the papers filed by the parties and oral

argument on the motion, the Court grants in part and denies in

part Defendant's motion for summary adjudication, and grants

Defendant's motion for partial judgment on the pleadings. 

BACKGROUND

Plaintiffs bring this action on behalf of themselves and

all similarly situated persons residing in California who

purchased certain automobiles manufactured by Defendant.2

Plaintiffs allege that, beginning in 1996, Defendant concealed

material information about the intake manifolds in these cars,

in violation of California law. 

An intake manifold performs multiple functions in a

automobile engine. The intake manifold distributes air to each

of the engine’s cylinders. The intake manifold may also serve

as part of the cooling system by channeling coolant across the

engine, to and from the radiator. Historically, intake

manifolds have been made of aluminum or other metal. Aluminum

manifolds can be expected to last the life of the engine.

Defendant had no problems with the performance of the water

crossover portions that distribute coolant in its aluminum

manifolds. Solomon Decl., Ex. 3, Beatham Dep. 11:8-12. 

The manifolds at issue in this case are composed entirely

of a non-metal nylon and glass composite material, i.e. plastic. 

Defendant’s first such manifold was described by Ford employees

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as “the world’s first V8 composite intake, and the first

composite intake manifold to integrate a water crossover.” 

Solomon Decl. Ex. 8, 4.6L-2v Composite Intake Action Plan &

Lessons Learned, February 17, 1999, at 2. The composite

manifold was hailed as “the beginning of a major technology

shift toward the use of plastics & composites on core engine

applications yielding substantial cost and weight savings.” Id.

Defendant began using non-metal composite manifolds, with a

thickness of three millimeters, in the water crossover pieces in

1996 model year vehicles, which were first available for sale in

June, 1995. Plaintiffs' earliest evidence that Defendant was

aware of problems with the manifolds is a November 16, 1995

report that a taxicab and a police car (heavily used cars

referred to as “fleet” vehicles) were experiencing coolant

leaks. Solomon Decl. Ex. 5, Nov. 16, 1995 Concern Detail at 1. 

Ford employee Gerald Czadzeck assigned engineer Wolfgang Beatham

to evaluate the results of a material analysis and bench test

fatigue simulation. By June 6, 1996, Mr. Beatham estimated the

part’s failure rate to be as high as nineteen per thousand at

50,000 miles and 270 per thousand at 120,000 miles. Id. at 3. 

This estimate did not reflect actual repair rates but rather was

“something we expect to occur at higher mileage with the current

production intake manifold.” Id. at 5. According to Mr.

Czadzeck, Mr. Beatham’s estimates reflected the “potential risk

of not correcting the problem” as “extrapolated to the general

public” rather than just high-end fleet users. Solomon Decl.,

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Ex. 4, Czadzeck Dep. 61:21-62:5. Mr. Czadzeck characterized Mr.

Beatham’s estimates as “tremendously high failure rates.” Id.

62:7-9. By August 28, 1997, internal Ford documents described

both a “high number of wear out failures on the composite intake

manifold on fleet customers and an increasing number of concerns

on general population vehicles.” Solomon Decl. Ex. 12, Field

Failures of Manifold Incorporated Engine Coolant Crossover Duct

at 1. 

Between 1996 and 2000, Defendant tried to fix the problem

by making several changes to the design of the non-metal

manifolds. The first proposed solution was to add one

millimeter of thickness to the water crossover parts; bench and

finite element testing reportedly showed that this would reduce

the projected warranty liability to zero at 120,000 miles. Id.

at 3. This four millimeter “second generation” water crossover

design was sold in 1997 model year vehicles. For 1998 model

year vehicles’ third generation manifold design, Defendant

increased the thickness to five millimeters. Solomon Decl. Ex.

2, Riedel Dep. 31:7-11. According to Ford documents, the “4 and

5 mm iterations each demonstrated significant improvements in

durability, but neither met [Defendant’s] 95 percentile customer

durability requirements.” Composite Intake Action Plan &

Lessons Learned, February 17, 1999, at 2. Defendant later

changed the nylon material “slightly” and made some design

revisions after the third generation. Riedel Dep. 33:5-17. 

In December, 1997, in order to address field failures with

the three millimeter coolant crossover, Defendant issued Owner

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Notification Programs (ONPs) to replace manifolds on Crown

Victoria police vehicles, and extended warranties on Crown

Victoria taxi, Thunderbird/Cougar and Mustang vehicles. Solomon

Decl., Ex. 13, Field Failures of Intake Manifold Incorporated

Engine Coolant Crossover Duct, July 27, 2000, rev. April 5,

2001, at 1. Similar ONPs were issued for four millimeter

manifolds on fleet vehicles and some missed three millimeter

vehicles. Id. These ONPs provided five millimeter replacements

for car owners' three and four millimeter manifolds. Id. 

Defendant ultimately decided not to use all-plastic

crossover designs in future vehicles. Id. at 5. The Ford team

had agreed, 

[D]ue to the fact that our best evidence indicates that the

failure is due to the accumulated effects of time,

temperature and pressure in service; there is no reason to

believe that the demand for service parts will increase

linearly or flatten out. In the lower severity duty cycles

the vehicles built at or around job #1 are only now

approaching the mileages where failures have occurred in

the most severe fleet applications. In all probability the

light duty applications will continue to fail at ever

increasing rates . . . . 

Solomon Decl. Ex. 17, June 29, 2000 Email from Gary Liimatta to

Thomas Zahm. According to an October 20, 2000 email,

approximately 8,000 intake manifolds were being replaced each

month on 1996 to 2000 model year 4.6L-2v passenger cars. 

Solomon Decl. Ex. 15, October 20, 2000 Email from Gregory Banish

to Thomas Zahm. Defendant never issued ONPs to members of the

Plaintiff class. 

Plaintiffs also provide evidence that class members were

affected by Defendant's failure to alert them to problems with

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their manifolds. The named Plaintiffs and the other class

members designated as witnesses all testify that they did not

expect their manifolds to fail, and some testify that they would

not have bought the cars had they known of the increased risk of

failure. See, e.g., Solomon Decl., Ex. 29, Alton Dep. 90:8-24,

93:2-19. 

Plaintiffs’ expert Richard Greenspan also testified as to the

high cost of replacing failed manifolds and the risk of engine

failure. Id., Ex. 26, Greenspan Rep. 4-5, 8-10. Mr. Greenspan

also testified that a typical vehicle owner would not expect

this part to fail. Id., Ex. 34, Greenspan Dep. 65-66. 

In addition, Plaintiffs' experts have testified that all or

most of class members' manifolds will eventually fail. 

According to Clemente Mesa, a mechanical engineer, ninety

percent of class members' manifolds will fail before the end of

the useful life of the car, and a majority of those will fail

before 100,000 miles, regardless of which version of the intake

manifold is used and regardless of whether the vehicle is used

by retail or fleet customers. Ram Decl., Ex. 1, Mesa Dep. 255-

257. Similarly, Dr. Anand Kasbekar, an expert in forensic

engineering, testified that "all versions" of the plastic

manifolds were defective in that they would not last the life of

the vehicle. Ram Decl., Ex. 2, Kasbekar Dep. 292:16-20. 

LEGAL STANDARD

Summary judgment is properly granted when no genuine and

disputed issues of material fact remain, and when, viewing the

evidence most favorably to the non-moving party, the movant is

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clearly entitled to prevail as a matter of law. Fed. R. Civ. P.

56; Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986);

Eisenberg v. Ins. Co. of N. Am., 815 F.2d 1285, 1288-89 (9th

Cir. 1987). 

The moving party bears the burden of showing that there is

no material factual dispute. Therefore, the court must regard

as true the opposing party's evidence, if supported by

affidavits or other evidentiary material. Celotex, 477 U.S. at

324; Eisenberg, 815 F.2d at 1289. The court must draw all

reasonable inferences in favor of the party against whom summary

judgment is sought. Matsushita Elec. Indus. Co. v. Zenith Radio

Corp., 475 U.S. 574, 587 (1986); Intel Corp. v. Hartford

Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991). 

Material facts which would preclude entry of summary

judgment are those which, under applicable substantive law, may

affect the outcome of the case. The substantive law will

identify which facts are material. Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 248 (1986).

Where the moving party does not bear the burden of proof on

an issue at trial, the moving party may discharge its burden of

showing that no genuine issue of material fact remains by

demonstrating that "there is an absence of evidence to support

the nonmoving party's case." Celotex, 477 U.S. at 325. The

moving party is not required to produce evidence showing the

absence of a material fact on such issues, nor must the moving

party support its motion with evidence negating the non-moving

party's claim. Id.; see also Lujan v. Nat’l Wildlife Fed’n, 497

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U.S. 871, 885 (1990); Bhan v. NME Hosps., Inc., 929 F.2d 1404,

1409 (9th Cir. 1991), cert. denied, 502 U.S. 994 (1991). If the

moving party shows an absence of evidence to support the nonmoving party's case, the burden then shifts to the opposing

party to produce "specific evidence, through affidavits or

admissible discovery material, to show that the dispute exists." 

Bhan, 929 F.2d at 1409. A complete failure of proof concerning

an essential element of the non-moving party's case necessarily

renders all other facts immaterial. Celotex, 477 U.S. at 323.

DISCUSSION

I. Class CLRA and UCL Claims

A. Required Elements of CLRA Claim

As a threshold matter, the parties dispute the required

elements of Plaintiffs' claim under the California Consumers

Legal Remedies Act (CLRA), Cal. Civ. Code § 1750 et seq. 

Specifically, Defendant argues that Plaintiffs must show that

disputes of material fact exist regarding certain elements of

common law fraud tort claims, including whether Defendant owed

Plaintiffs a duty and whether Defendant acted with an intent to

deceive. Plaintiffs argue that such tort elements are not

required to state a claim under the CLRA, and that the Court

decided as much in its August 6, 2003 Order on Defendant’s

motion to dismiss. 

To establish a fraud tort claim based on failure to

disclose a material fact, a plaintiff must prove, among other

things, the existence of a duty of reasonable care and an

intentional breach of that duty. See LiMandri v. Judkins, 52

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Cal. App. 4th 326, 336 (1997) (outlining four circumstances in

which non-disclosure may constitute actionable fraud);

Restatement (Second) of Torts § 551 (setting forth potential

grounds for tort liability based on non-disclosure). Defendant

argues that Plaintiffs' CLRA claims must also meet these common

law fraud requirements, but the two cases it cites as authority

fail to support this proposition. In Consumer Advocates v.

Echostar Satellite Corp., the court, in evaluating whether

certain statements constituted misrepresentation for purposes of

a CLRA claim, noted that the statements were “akin to ‘mere

puffing,’ which under long-standing law cannot support liability

in tort.” 113 Cal. App. 4th 1351, 1361 n.3 (2003) (citing

Hauter v. Zogarts, 14 Cal. 3d 104, 111 (1975)). While this

suggests that tort standards at times may be relevant to a

court’s evaluation of CLRA actions, it falls far short of

establishing that CLRA actions must fulfill the same elements as

common law fraud claims. Similarly, in an unpublished decision

in Vess v. Ciba-Geigy Corp. USA, 2001 WL 290333, at *10 (S.D.

Cal. March 9, 2001), the court found that CLRA claims sound in

fraud and therefore must be plead with particularity pursuant to

Federal Rule of Civil Procedure 9(b). The fact that CLRA claims

must meet a heightened pleading standard does not lead to the

conclusion that a CLRA claim must fulfill all of the elements of

a fraud tort claim. This conclusion is consistent with the

Court’s previous finding that Defendant has not shown that a

duty must be alleged in order to state a claim under either the

CLRA or the Unfair Competition Law (UCL). See August 6, 2003

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Order at 9. 

For this reason, Defendant’s arguments that Plaintiffs have

failed to show disputed issues of material fact with respect to

the general principles of tort law governing fraud, rather than

the CLRA, are inapposite. These arguments include whether

Defendant owed a duty to the initial purchasers of its cars,

whether that duty runs to used car purchasers, and whether

Defendant’s acts were calculated to induce a false belief. 

Defendant has also shown no grounds for the Court to reconsider

the conclusions in its previous order, namely that pure

omissions are actionable under the CLRA and that Plaintiffs who

purchased used cars have standing to bring CLRA claims, despite

the fact that they never entered into a transaction directly

with Defendant. 

B. Materiality

Defendant argues that Plaintiffs have not produced

sufficient evidence to raise a genuine dispute of fact as to

whether consumers would have considered the likely post-warranty

performance of the manifolds to be material. 

In order to prove that non-disclosed information is

“material,” Plaintiffs must be able show that “had the omitted

information been disclosed, one would have been aware of it and

behaved differently.” Mirkin v. Wasserman, 5 Cal. 4th 1082,

1093 (1993). Materiality is judged by the effect on a

“reasonable consumer,” and this standard applies to CLRA claims.

Consumer Advocates, 113 Cal. App. 4th at 1360. “[A]necdotal

evidence alone is insufficient to prove that the public is

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3Defendant argues that Mr. Greenspan is not qualified to

offer an opinion about consumer expectations with regard to

manifolds because he is an auto mechanic, not a marketing

specialist. See Defendant’s Reply at 7 n.3. However, Mr.

Greenspan’s experience as an auto mechanic does allow him to

provide reliable opinion evidence regarding consumer

expectations about which auto parts will fail and which will

not. His report does not purport to provide direct evidence

about exactly what car purchasers would have done had Defendant

disclosed the information. Defendant’s arguments go to the

weight rather than the admissibility of Mr. Greenspan’s

testimony. 

11

likely to be misled” under the reasonable consumer standard. 

Haskel v. Time, 965 F. Supp. 1398, 1407 (E.D. Cal. 1997) (citing

William H. Morris Co. v. Group W. Inc., 66 F.3d 255, 258 (9th

Cir. 1995)). 

Plaintiffs provide testimony from some class members that

they would not have bought the cars had they known of the

increased failure risk. See, e.g., Solomon Decl., Ex. 29, Alton

Dep. 90:8-24, 93:2-19. Alone, this anecdotal testimony would be

insufficient to establish materiality. However, Mr. Greenspan

also testified that a typical vehicle owner would not expect

this part to fail, and described the high cost of replacing

failed manifolds and the serious risk of engine failure.3 In

addition, Defendant’s own ONP provided to certain retail owners

corroborates Plaintiffs' experts' testimony regarding the

significance of manifold failure. 

Defendant argues that Plaintiffs’ showing is insufficient

without direct evidence that reasonable customers choose which

cars to buy based on the reliability of particular components. 

This type of evidence is not necessary in order for a reasonable

jury to conclude that a failure to disclose such heightened

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risks is material. Because most manifolds do last the life of

the engine, it is not surprising that manifold reliability is

usually not a factor in the decision of which car to purchase. 

The fact that most consumers do not consider manifold

reliability does not lead to the conclusion that the average

consumer would not consider an increased rate of post-warranty

failure to be material either to choice of car or price. 

Plaintiffs’ evidence is sufficient to establish a dispute of

fact regarding materiality. 

C. Causation and Damages

Defendant argues that a reasonable jury could not conclude

that class representatives Chamberlan and Fok suffered damage

“as a result” of Defendant’s unlawful acts. Cal. Civ. Code

§ 1780(a). “Relief under the CLRA is specifically limited to

those who suffer damage, making causation a necessary element of

proof.” Wilens v. TD Waterhouse Group, Inc., 120 Cal. App. 4th

746, 754 (2003). 

Plaintiffs rely on Mass. Mutual Life Ins. Co. v. Superior

Court, 97 Cal. App. 4th 1282, 1292-94 (2002), for the

proposition that causation can be proved through a finding of

materiality. In that case, the plaintiffs contended that the

defendant’s misrepresentations “would have been material to any

reasonable person contemplating purchase” of certain insurance

products. 97 Cal. App. 4th at 1293. The court ruled that the

CLRA’s causation requirement did not render the case unsuitable

for class treatment because, if the plaintiffs were successful

in proving these facts, “the purchases common to each class

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member would in turn be sufficient to give rise to the inference

of common reliance on representations which were materially

deficient.” Id. Plaintiffs point to the costs to Chamberlan

and Fok of their failed manifolds as a measure of damages. 

Defendant argues that Mass. Mutual permits an inference of

reliance “only if a plaintiff can show that the allegedly

omitted information was material,” and that Plaintiffs cannot do

so. Def.’s Reply at 10. Defendant is correct that a finding of

materiality is crucial to this case, but Plaintiffs do not

dispute this point of law. As described above, Plaintiffs have

sufficient evidence to establish a dispute of fact as to

materiality. Plaintiffs' inability to prove that the original

owners of Ms. Chamberlan and Mr. Fok's cars would have passed

along negative information about the manifolds goes to the

weight of the evidence that the jury has to consider.

Defendant contends that the named Plaintiffs must

provide evidence that they would have been financially

better off had they purchased different used vehicles. As

Plaintiffs note, there is no authority for this

proposition. The named Plaintiffs are able to show

specific damages incurred by the failure of their intake

manifolds. This is sufficient to create a triable issue of

fact regarding damages. 

For the foregoing reasons, the Court denies

Defendant’s motion for summary adjudication of the named

Plaintiffs’ CLRA claims. 

D. UCL Claims

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Defendant also moves for summary adjudication of the

named Plaintiffs' individual UCL claims, on the grounds

that Plaintiffs have failed to raise a dispute of material

fact as to whether Defendant's conduct was "unlawful,

unfair or fraudulent." Cal. Bus. & Prof. Code § 17200. 

Plaintiffs' argument that Defendant's acts were

"unlawful" rests on their underlying CLRA claims. Because

the Court finds that a dispute of material fact exists as

to the CLRA claims, "unlawfulness" under the UCL is

necessarily also a matter of disputed fact. Likewise, as

described above, the Court finds that Plaintiffs have shown

some non-anecdotal evidence that Defendant's omission was

"fraudulent." Defendant's motion for summary adjudication

of the named Plaintiffs' UCL claims is therefore denied. 

II. CLRA Claims of Certain Subsets of the Class

A. Class Members Whose Manifolds Have Not Failed

Defendant moves for summary adjudication of the claims

of class members whose manifolds have not yet failed, on

the grounds that they have suffered no cognizable injury

and, in the alternative, that Plaintiffs have failed to

establish the amount of damages. 

Cal. Civ. Code § 1780(a) allows an action to be

brought by a consumer “who suffers any damage” as a result

of acts in violation of the CLRA. Such a consumer can then

recover “[a]ctual damages, but in no case shall the total

award of damages in a class action be less than one

thousand dollars.” Cal. Civ. Code § 1780(a)(1). Although

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the CLRA does not define “actual damages,” in the context

of common law fraud, California courts have defined “actual

damages” to mean “those which compensate someone for the

harm from which he or she has been proven to currently

suffer or from which the evidence shows he or she is

certain to suffer in the future.” Saunders v. Taylor, 42

Cal. App. 4th 1538, 1543 (1996). Actual damages “are to be

distinguished from those which are nominal rather than

substantial, exemplary or punitive rather than

compensatory, and speculative rather than existing or

certain.” Id. at 1543-44. Prevailing consumers under the

CLRA may also obtain an injunction, restitution, punitive

damages, and “any other relief the court deems proper.” 

Cal. Civ. Code § 1780(a)(2-5). 

The plain language of the CLRA does not require that

consumers suffer particular pecuniary losses in order to

bring a CLRA claim and recover at least the statutory

minimum, nor does Defendant cite any case to the contrary. 

Plaintiffs can establish some damage by the reasonable

inference that the class members’ plastic manifolds have

suffered more degradation than manifolds made from aluminum

or metal composite. This showing is sufficient to meet the

requirements for standing under the CLRA. Cf. Wilens v. TD

Waterhouse Group, Inc., 120 Cal. App. 4th 746 (2003)

(denying class certification in CLRA action where court

could not presume that each class member suffered “any

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damage” due to allegedly unconscionable contract

provision). 

However, Plaintiffs' position that class members whose

manifolds have not failed may recover compensatory damages

beyond a share of the statutory minimum, absent evidence of

specific losses, also lacks authority. On this point,

Kagan v. Gibralter Savings and Loan is inapposite. There,

the court refused to let a defendant “pick off” the

prospective named plaintiff in a class action by providing

an individual remedy to that plaintiff. 35 Cal. 3d 582,

593 (1984). In so doing, the court rejected the

defendant’s attempt to “equate pecuniary loss with the

standing requirement that a consumer ‘suffer [] any

damage.’” Id. Kagan does not speak to the question of

what constitutes “actual damages” for purposes of recovery

under the CLRA. 

In their supplemental brief regarding damages,

Plaintiffs argue that they have provided evidence to show

that class members' manifolds are "substantially certain"

to fail before the end of the useful life of the car. See

Hicks v. Kaufman & Broad Home Corp., 89 Cal. App. 4th 908,

923 (2001) (finding that plaintiff in action for breach of

warranty need only show that product is substantially

certain to malfunction during the useful life of the

product); Microsoft Corp. v. Manning, 914 S.W.2d 602, 609-

610 (Tex. App. 1995) (finding disk operating system with

potential to destroy software constituted compensable

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4Defendant cites several unpublished cases in which courts

outside California have refused to apply Manning to cases where

defective automobile components have yet to malfunction. See,

e.g., Gen. Motors Corp. v. Garza, 2005 WL 154198 (Tex. Ct. App.,

Jan. 26, 2005). None of the cases involve the CLRA, and they

are unpersuasive in light of the requirement to construe the

CLRA liberally. See Cal. Civ. Code § 1760. Moreover, one of

those cases recognized that plaintiffs might be allowed to

recover damages where resale value is reduced due to an

automobile defect that is "sure (or extremely likely) to

manifest itself at a future date." In re Gen. Motors Type III

Door Latch Litigation, 2001 WL 103434 at *5 (N. D. Ill., Jan.

31, 2001). 

17

injury under the Washington Consumer Protection Act). 

Defendants maintain that Hicks and Manning do not apply to

products such as cars that do not have an indefinite useful

life. See Hicks at 923 ("Foundations . . . are not like

cars or tires. Cars and tires have a limited useful

life."); Manning at 609 (same). Yet the reasoning of Hicks

and Manning applies equally well in situations where the

overall product, here a car, has a limited but long useful

life and a component has a defect that is substantially

certain to manifest itself before the end of that useful

life.4 

Plaintiffs have offered some evidence, in the form of

Mr. Mesa and Dr. Kasbekar's testimony, that all or nearly

all of class members’ manifolds will fail before the end of

the useful life of the car. The fact that Dr. Kasbekar

admitted that for any given vehicle neither he nor Ford

could quantify how long the manifold would last, see, e.g.,

Supp. Swaney Decl., Ex. 3, Kasbekar Dep. 103:19-104:2, does

not negate his overall opinion that they will all fail

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prematurely. Plaintiffs' evidence is sufficient to

establish a dispute of material fact with respect to

manifolds of class members that have not yet failed. 

For these reasons, the Court denies Defendant’s motion

for summary adjudication of the claims of class members

whose manifolds have not yet failed. However, the

potential recovery of this subset of the class will be

limited unless Plaintiffs prove at trial that their

manifolds are substantially certain to fail prematurely. 

B. Class Members Whose Manifolds Failed Before April

25, 2000

Defendant moves for summary adjudication of the claims

of class members whose manifolds failed before April 25,

2000 on the grounds that Plaintiffs have not identified

sufficient evidence to support their contention that

Defendant’s concealment of the problems with the manifolds

tolled the statute of limitations. See First Amended

Complaint ¶ 26. 

The CLRA provides that actions “shall be commenced not

more than three years from the date of the commission” of a

method, act or practice made unlawful by the act. Cal.

Civ. Code § 1783. This statute of limitations runs “from

the time a reasonable person would have discovered the

basis for a claim.” Mass. Mutual, 97 Cal. App. 4th at

1295. The mere fact that a consumer’s manifold failed does

not necessarily mean that that person should have

discovered Defendant’s alleged non-disclosure at that time. 

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Defendant’s evidence that two customers did suspect that

Defendant was responsible for their defective manifolds

prior April 25, 2000 shows that there may be a dispute of

fact on this issue, but does not entitle Defendant to

summary adjudication of the claims of this class subset. 

C. Class Members Whose Vehicles Were Originally Sold

Before 1998

Defendant moves for summary adjudication of the claims

of class members whose vehicles were originally sold before

1998 on the grounds that Plaintiffs’ own expert evidence

shows that Ford did not have any knowledge regarding the

composite material that it should have disclosed to

purchasers of retail vehicles. 

Ford points to the testimony of Plaintiffs’ expert

Thomas Feaheny to support its contention. See Swaney

Decl., Ex. T, Feaheny Dep. 164:11-25 and 254:23-255:25. He

testified that it was not until 2001 that Defendant

“recognized and committed to . . . taking corrective

action,” and that some of the “detailed specifications” for

the composite material used “probably” changed over time. 

Id. at 164:11-25. Futhermore, upon being asked when

Defendant should have informed retail customers about the

problems with the manifolds, Mr. Feaheny replied, "Probably

not at that time [when the Las Vegas taxi problem was

reported], but probably as soon as 1998 or 1999 when they

had had considerable information and they'd already been

involved in making changes . . . ." Id. at 255:7-17. He

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later explained that it was possible that retail customers

should have been informed sooner, and that he was "not

totally sure exactly when everybody knew what." Id. at

255:18-15. Regardless of Mr. Feaheny's actual opinion, the

question of what Defendant should have disclosed and when

it should have done so is ultimately a decision for the

jury to make as part of its materiality determination. In

light of the other evidence provided by Plaintiffs showing

that Defendant had significant knowledge about the

manifolds prior to 1997, the Court finds that Plaintiffs

have raised a triable issue of material fact as to the

claims of this subset of the class. 

D. Class Members Whose Vehicles Were Originally Sold 

Before Ford had Experience with the Manifold Design

Defendant moves for summary adjudication of the claims

of class members whose vehicles were sold before it had

several years of experience with the particular manifold

design. Specifically, Defendant argues that Plaintiffs’

experts admit that it could not have known of the problems

with each version of the manifold until a sufficient track

record was established for that manifold. 

Defendant's reliance on brief excerpts from

Plaintiffs’ expert testimony misinterprets the evidence. 

For instance, Dr. Kasbekar’s opinion was that Defendant

failed to research fully the limitations of the non-metal

composite material, resulting in a design he believes was

“clearly inadequate for its intended purpose.” Swaney

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Decl. Ex. U, Kasbekar Rep. at 12; see also Ex. V, Feaheny

Rep. at 5 (“because the engineers had not done their

homework, they did not initially contemplate the failure

mode at issue in this case.”). As explained above in

Section II(C), Mr. Feaheny did not testify that Defendant

had no material information about each successive manifold

design until years after its introduction. The reports as

a whole provide at least some evidence that Ford should

have known that its attempts to fix the problem would not

work. Overall, Plaintiffs have raised disputed issues of

material fact sufficient to allow the jury to decide

whether, and if so when, past experience with plastic

manifolds constituted material information about later redesigns, and therefore should have been disclosed by

Defendant. 

However, Plaintiffs have failed to provide evidence

that would allow a reasonable jury to conclude that

Defendant concealed material facts from consumers when the

non-metal composite manifolds were first introduced in

June, 1995. The earliest reported problems occurred in two

fleet vehicles in November, 1995, and the earliest evidence

that Ford engineers understood that this was a systemic

problem is Mr. Beatham’s June 6, 1996 estimate of

significant manifold failure rates. Solomon Decl. Ex. 5,

Concern Detail. Neither Plaintiffs nor their experts

suggest that Defendant’s failure to research fully was an

act of concealment at the earliest stages. For this

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5This holding does not apply to class members who, after

June 6, 1996, purchased a second hand vehicle that was

originally bought before June 6, 1996. 

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reason, the Court grants Defendant’s motion for summary

adjudication of the claims of members of the class who

purchased their vehicles prior to June 6, 1996.5 

IV. Judgment on the Pleadings of UCL Claim

Defendant moves for judgment on the pleadings of the

named Plaintiffs’ claim on behalf of the general public,

pursuant to the former “private attorney general” clause of

California’s Unfair Competition Law (UCL), Cal. Bus. &

Prof. Code § 17200 et seq. Plaintiffs oppose this motion. 

On November 2, 2004, the California electorate passed

a ballot initiative known as Proposition 64. This

initiative amended the UCL to eliminate the ability of

private individuals to bring actions on behalf of the

general public. The UCL now requires a private plaintiff

seeking to bring an action for injunctive or restitutionary

relief to establish that he or she “has suffered injury in

fact and has lost money or property.” Cal. Bus. & Prof.

Code § 17204. Private plaintiffs who wish to maintain

representative actions must satisfy both this standing

requirement and the requirements for a class action in

California Code of Civil Procedure § 382. Id. § 17203. 

Proposition 64 was silent on the question of whether

these new standing requirements should be applied to

pending cases filed before November 2, 2004. Courts of

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6Although these cases are no longer published authority, the

Court notes that most of the cases held that Proposition 64 was

retroactive, and that the reasoning of those cases is

persuasive. 

23

Appeal have addressed this issue multiple times, and the

California Supreme Court granted review on this issue after

oral argument on this motion was heard. See, e.g.,

Californians for Disability Rights v. Mervyn’s, LLC,

previously published at 126 Cal. App. 4th 386 (2005), rev.

granted, (Apr. 27, 2005); Branick v. Downey Savings and

Loan Assoc., previously published at 24 Cal. Rptr. 3d 406,

413-417 (2005), rev. granted, (Apr. 27, 2005); Benson v.

Kwikset Corp., previously published at 24 Cal. Rptr. 3d

683, 693-698 (2005), rev. granted, (Apr. 27, 2005); Bivens

v. Corel Corp., previously published at 24 Cal. Rptr. 3d

847, 853-856 (2005), rev. granted, (Apr. 27, 2005); Lytwyn

v. Fry’s Elec., previously published at 25 Cal. Rptr. 3d

791, 812 (2005), rev. granted, (Apr. 28, 2005).6 The

Courts of Appeal decisions therefore are no longer citable

authority. Cal. Rules of Court, Rules 976(d), 977(a). 

Accordingly, the Court does not rely on those decisions. 

When reviewing issues of State law, a federal court is

"bound to follow the decisions of a state's highest court

in interpreting that state's law." Olympic Sports Prod. v.

Universal Athletic Sales Co., 760 F. 2d 910, 912-13 (9th

Cir. 1986) (citing Aydin Corp. v. Loral Corp., 718 F. 2d

897, 904 (9th Cir. 1983)). A federal court should apply

State law as it believes the highest court of the State

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would apply it. See Jones-Hamilton Co. v. Beazer Materials

& Servs., Inc., 973 F.2d 688, 692 (9th Cir. 1992). 

Plaintiffs urge that, in the absence of clear voter

intent, the Court should apply the usual presumption that

statutory enactments do not operate retroactively. This

presumption was applied to voter repeal of a common law

right in Evangelatos v. Superior Court, 44 Cal. 3d 1188,

1214 (1988). Defendant argues, however, that Proposition

64 falls squarely within a contrary rule on repeal of

statutes: absent a savings clause, repeals of statutory

enactments must apply retroactively to pending cases. Cal.

Gov. Code § 9606; see also Callet v. Alioto, 210 Cal. 65

(1930) (explaining application of § 9606 notwithstanding

customary presumption against retroactivity). Plaintiffs

contend that the rule of retroactivity of the repeal of

statutes does not apply here because Proposition 64 amended

rather than repealed rights under the UCL, and because the

UCL is "derived from" common law. Plaintiffs acknowledge

that California courts have repeatedly found that UCL

torts, despite their common law ancestry, cannot be equated

with the common law definition of unfair competition, see,

e.g., Bank of the West v. Superior Court, 2 Cal. 4th 1254,

1264 (1992), but Plaintiffs fail to rebut Defendant's

argument that as a consequence, the rule of retroactivity

of the repeal of statutes does apply here. Nor do

Plaintiffs address Defendant's argument that § 9606 applies

to the repeal of part, as well as all, of a statute. The

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Court believes that the California Supreme Court will find

Proposition 64 to be retroactive. 

For this reason, the Court grants Defendant’s motion

for judgment on the pleadings of Plaintiffs’ claim on

behalf of the general public. Defendant's argument that

Plaintiffs cannot bring private attorney general claims

under the UCL in federal court without meeting the

requirements of Federal Rule of Civil Procedure 23 is moot. 

However, Plaintiffs may move to amend the complaint to

allege that they meet the requirements of § 17204 as

amended. 

CONCLUSION

For the foregoing reasons, the Court GRANTS in part

and DENIES in part Defendant's motion for summary

adjudication (Docket No. 250). The Court GRANTS

Defendant's motion for partial judgment on the pleadings

(Docket No. 245), without prejudice to Plaintiffs' filing a

motion for leave to file an amended complaint. 

IT IS SO ORDERED.

Dated: 5/4/05 /s/ CLAUDIA WILKEN 

CLAUDIA WILKEN

United States District Judge

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