Court Opinion

ID: 4256033
Source: CourtListenerOpinion
Date Created: 2018-03-19 19:31:00.879897+00
Date Added: 2024-06-11T12:15:51.075443
License: Public Domain

F ILE0
                                                            COURT OF APPEALS DIV I
                                                             STATE OF WASHINGTON

                                                            2011111AR 19 AM 8:146

     IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON

DAVID NAUHEIM and                                No. 76274-5-1
COLLEEN NAUHEIM, husband and
wife and the marital community
composed thereof,

                     Appellants,
                                                 DIVISION ONE
       V.

VOLKSWAGEN GROUP OF
AMERICA, INC., a foreign corporation,
                                                 UNPUBLISHED OPINION

                     Respondent.                 FILED: March 19, 2018

       SPEARMAN, J. — In class action litigation, a judgment for the plaintiff class
extinguishes the claims of individual plaintiffs. David and Colleen Nauheim

(Nauheim) appeal the dismissal of their suit against Volkswagen Group of

America (VW). But Nauheim's individual claim was extinguished by the class

action settlement. We affirm.

                                      FACTS

       In the fall of 2015, VW admitted that it had installed "defeat device"

software in model 2009-2015 diesel cars. The software allowed vehicles to evade

emission-control requirements by artificially reducing emissions during testing.
 No. 76274-5-1/2

         Nauheim owns a 2009 Volkswagen Jetta TDI (turbocharged direct

 injection diesel). He filed a complaint against VW in King County Superior Court

 in November 2015. Based on the defeat device software, Nauheim asserted

 claims for fraud, violations of the Consumer Protection Act, Ch. 19.86 RCW and

 Auto Dealers Act, Ch. 46.70 RCW and "Other Violations of State and Federal

 Law." Clerk's Papers(CP)at 7.

         Separately, many parties filed actions against VW in federal court. In

 December 2015, a judicial panel granted a motion to establish centralized pretrial

 proceedings for federal actions arising from the defeat device software. The

 panel established multidistrict legislation (MDL)in the Northern District of

 California and transferred pending federal cases.

         In the Nauheim matter, VW asked Nauheim to specify the violations of

federal law referenced in the complaint. WV asserted that this information would

 allow it to evaluate the Nauheim matter for possible removal to federal court and

 transfer to the MDL. Nauheim filed an amended complaint that omitted the

 reference to violations of federal law. Nevertheless, VW asserted that Nauheim's

 claims depended on federal law and removed the action to federal court.1 On

 March 15, 2016, the Western District court remanded to King County Superior

 Court. The court ruled that Nauheim's complaint alleged only state causes of

 action and the resolution of these claims did not depend on federal law. The

 Nauheim matter proceeded in superior court.

           In the alternative, \AN asserted that the federal court had diversity jurisdiction because
 the true amount in controversy was greater than $75,000. The trial court rejected this argument
'because Nauheim expressly sought less than $75,000 in actual damages.
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No. 76274-5-1/3

      The MDL litigation was also proceeding. In January 2016, the plaintiffs'

steering committee appointed a lead counsel. The lead counsel filed a consumer

class action suit on February 22. The action identified class members as persons

who owned or leased affected VW vehicles and encompassed their federal and

state law claims based on the defeat device.

       In July, the MDL court granted preliminary approval of a settlement in the

class action. Under the terms of the settlement, owners of affected VW cars are

entitled to cash restitution and either a vehicle buyback or a free fix. In exchange,

class members release "any and all claims... arising from or in any way related

to" the device defeat software. CP at 484. The court certified the proposed class

and ordered that class members be given notice through a variety of media. The

court prescribed an opt-out procedure and set September 16, 2016 as the opt out

deadline.

       Based on the preliminary class action settlement, VW moved to continue

the Nauheim matter. VW stated that Nauheim was a putative class member and

had until September 16 to decide whether to accept the settlement or pursue a

separate claim. VW's position was that, if Nauheim did not timely opt out, the

settlement would moot the King County case. Nauheim opposed VW's motion

and asserted that he intended to reject the proposed settlement. The court •

continued the matter until after the opt out deadline.

       On October 25, the MDL court issued an order granting final approval of

the class action settlement. The order grants final certification of the settlement

class and dismisses with prejudice any individual claims by class members who

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No. 76274-5-1/4

did not timely opt out. The order enjoins class members who did not timely opt

out from commencing or maintaining any action against VW based on the defeat

device software.

       In King County, VW moved to dismiss the Nauheim action under CR 12(c)

based on the class action settlement. VW asserted that, because Nauheim did

not opt out of the settlement, he was precluded from maintaining his claim. In

response, Nauheim relied on the order of the Western District court remanding to

King County. Based on this order, Nauheim asserted that only the King County

Superior Court had jurisdiction over his claims and he was not bound by the

decision of the federal court in the class action. The trial court rejected

Nauheim's argument and granted VVV's motion to dismiss. Nauheim appeals.

                                    DISCUSSION

       We review a dismissal under CR 12(c) de novo. P.E. Systems, LLC v. CPI

corp., 176 Wash. 2d 198, 203, 289 P.3d 638(2012)(citing Parilla v. King County,

138 Wash. App. 427, 431, 157 P.3d 879(2007)). Where a class action is properly

conducted, the judgment in the action binds all class members. Matsushita Elec.

Indus. Co. v. Epstein, 516 U.S. 367, 379, 116 S. Ct. 873, 134 L.Ed.2d 6(1996). A

judgment in favor of the plaintiff class extinguishes the claims of individual

plaintiffs. Cooper v. Fed. Reserve Bank of Richmond, 467 U.S. 867, 874, 104 S.

Ct. 2794, 81 L.Ed.2d 718(1984). The judgment in the class action thus has a

preclusive effect on subsequent litigation.

       These principles are not altered because the judgment in the class action

is issued by a federal court. Judgments of federal courts receive the same full

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No. 76274-5-1/5

faith and credit as judgments from other states. Williams v. Steamship Mut.

Underwriting Ass'n, 45 Wash. 2d 209, 213, 273 P.2d 803(1954)(citing Hancock

Nat. Bank v. Farnum, 176 U.S. 640, 20 S. Ct. 506, 44 L. Ed. 619(1900)). See

also Stoll v. Gottlieb, 305 U.S. 165, 170, 59 S. Ct. 134, 137,83 L. Ed. 104(1938)

(state courts must accord judgments of federal courts "the same dignity... as

those of its own courts.. .").

       Nauheim asserts that his individual claim was not extinguished by the

class action. He argues that, because his individual claim presents only state

causes of action, the federal court that decided the class action had no

jurisdiction over his claim. Nauheim contends that the lack of federal jurisdiction

was established when the Western District court remanded his claim to King

County. Nauheim further asserts that the Western District remanded because it

determined that he was not a member of the class represented in the class

action. These arguments are without merit.

       In remanding to King County, the Western District court ruled that

Nauheim's individual claim did not present a federal question. This ruling

occurred before the class was certified in the class action. The district court did

not rule on whether Nauheim was a class member, whether his claims were

encompassed in the class action, or whether the federal court had jurisdiction

over the class action. The remand of Nauheim's individual suit has no bearing on

the class action.

       Nauheim's individual claim is based on his ownership of a 2009

Volkswagen Jetta TDI affected by the defeat device software. The class action

                                          5
No. 76274-5-1/6

identifies as class members all persons who owned or leased cars affected by

the defeat device software, expressly including 2009 Jetta TDIs. The class action

encompasses state law claims by persons who own affected vehicles, expressly

including claims based on Washington State law. The federal court ruled that it

had personal jurisdiction over class members and subject matter jurisdiction over

the federal and state law claims of class members. The settlement order

dismisses with prejudice claims by class members who did not timely opt out and

enjoins class members from maintaining actions arising from the defeat device

software.

          Nauheim's individual claim is encompassed in the class action settlement

and was extinguished by that settlement.2 The trial court did not err in dismissing

Nauheim's suit.

          Nauheim asserts, however, that the Western District's order stating that it

did not have jurisdiction became the law of the case. He also asserts, in his reply

brief, that his on-going litigation was tantamount to opt out and that the superior

court lacked authority to enforce the class action settlement. He provides no

authority to support these assertions. We decline to consider conclusory

arguments that are unsupported by citation to authority. Joy v. Dep't of Labor &

Industries, 170 Wn. App. 614,629, 285 P.3d 187(2012)(citing RAP 10.3(a)(6)).

See also Cowiche Canyon Conservancy v. Bosley, 118 Wash. 2d 801, 809, 828

P.2d 549(1992)(declining to consider issue raised for the first time in reply

brief).

                                           6
No. 76274-5-1/7

        Affirmed.

WE CONCUR:

         2 It appears that Nauheim may still take advantage of the settlement in the class action.
At oral argument, VW asserted that, as a class member, Nauheim has until September 2018 to
select a buyback or free fix.
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