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Butler v. Porsche Cars North America, Inc.

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

April 19, 2017

PAUL BUTLER, Plaintiff,
v.
PORSCHE CARS NORTH AMERICA, Inc., Defendant.

          ORDER DENYING MOTION FOR CLASS CERTIFICATION RE: DKT. NO. 44

          LUCY H. KOH United States District Judge

         Plaintiff Paul B. Butler (“Plaintiff”) brings the instant putative class action against Defendant Porsche Cars North America, Inc. (“Defendant” or “Porsche”) for violation of the Consumer Legal Remedies Act, Cal. Civ. Code § 1750, et seq. (“CLRA”) and California's Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, et seq. (“UCL”). Before the Court is Plaintiff's motion for class certification. The Court finds this matter appropriate for determination without oral argument and hereby VACATES the motion hearing set for April 20, 2017. Civil L. R. 7-1(b). 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.

         I.BACKGROUND

         A. Factual Background

         Plaintiff is a California resident and seeks to represent a class and a sub-class of statewide consumers who purchased a 2005-2008 Porsche 911 (alternatively called “Porsche 997”) vehicle manufactured before February 2008 (hereinafter, “Class Vehicles”). Plaintiff alleges that the wiring harness in all Class Vehicles, which is used to connect the vehicle's alternator and battery in order to allow the alternator to recharge the car's battery, is defectively designed.

         1. Plaintiff's Experience with the Wiring Harness Defect

         Plaintiff owns a 2007 Porsche 911 S C2 Cabriolet. ECF No. 37 (First Amended Class Action Complaint, or “FAC”), at ¶ 6. Plaintiff purchased his vehicle used from Stevens Creek Porsche, a Porsche factory authorized dealership in Santa Clara, California, on July 18, 2015. Id.; see Butler v. Porsche Cars N.A., Inc., 2016 WL 4474630, at *1 (N.D. Cal. Aug. 25, 2016). Plaintiff's vehicle was sold to its original owner on May 27, 2007. See FAC, Ex. 1.

         When Plaintiff's vehicle reached approximately 78, 000 miles, Plaintiff “found that the key remained stuck in his vehicle and the car would not start.” Id. ¶ 6. Plaintiff brought his vehicle to Stevens Creek Porsche for inspection and repair. Id. The mechanic found that Plaintiff's battery “was insufficiently charged.” Id. The mechanic replaced the alternator, but the battery continued to charge insufficiently. Id. The mechanic eventually found that the problem was caused by a faulty wiring harness in Plaintiff's vehicle. Id. The mechanic replaced Plaintiff's wiring harness, and charged Plaintiff $3, 180.44 for the repair. Id.

         2. The Nature of the Alleged Defect

         According to Plaintiff, Class Vehicles suffer from a defective wiring harness which connects the vehicle's alternator to the battery. This wiring harness is necessary to recharge the battery from the alternator during the vehicle's operation. The wiring harness “is comprised of two pieces of copper cable, connected by a [brass] terminal lug mounted on the starter.” See Opp. at 9; ECF NO. 53-4 (“Meltzer Decl.”), ¶ 5.

         On August 11, 2007, Ken Gould (“Gould”), an employee at Porsche, investigated the wiring harness problem and prepared a report on the source of the problem. ECF No. 45-6 (“Gould Report”), at 2. Gould explained that the wiring harness was “overheating at the starter terminal lug, ” which caused the “cable insulation near the starter terminal lug and the rubber protective cover on the lug to melt.” Id. This resulted “in a reduced battery charge voltage, ” leading to “discharge[] to the point that vehicle engine w[ould] not start.” Id. Gould conducted an investigation on the wire harnesses and concluded that “[t]he root cause for the wire harness failure appears to be a poor electrical connection between the 25 mm stranded copper wire and the brass alloy terminal lug that connects the 25 mm and 35 mm cables and provides power to the starter when subjected to higher current loads.” Id. at 4. Gould explained that “[t]he poor electrical connection is probably the result of the much lower electrical conductivity of the brass terminal (28%) when compared to copper and less than perfect crimping of the [brass] terminal to the 25 mm [copper] cable.” Id. Gould further also stated that “[t]he use of a 25 mm stranded copper cable to carry the potential current capacity of the 150 ampere alternator is questionable as well.” Id.

         In November 2007, following completion of the Gould report, Eric Meltzer (“Meltzer”), an engineer at Porsche, “escalated the issue” to the manufacturer of Porsche-brand motor vehicles, Dr. Ing h.c. F. Porsche AG (“Porsche AG”). Meltzer Decl. ¶ 9. Meltzer's report largely repeated the findings and conclusions of the Gould report. See ECF No. 50-5.

         Meltzer also “drafted an Advanced Technical Information (“ATI”) that was published to Porsche authorized dealerships on January 30, 2008.” Meltzer Decl. ¶ 10. “The ATI advised dealers that the Cable may be the cause of” customer complaints regarding battery discharge. Id.

         Also in January 2008, Porsche instituted two “countermeasures” to correct for the faulty wiring harness. ECF No. 45-5 (“Meltzer Dep.”), at 5. First, because Porsche learned that the wire defect was a result of a “process abnormality” at the supplier, Porsche corrected the abnormality “at the supplier.” Id. at 5. Porsche also implemented a “second countermeasure” whereby Porsche made changes to the wiring harness itself. Id. Thus, beginning in January 2008, Porsche “used a next-generation” wiring harness. Id. Accordingly, Porsche 911 vehicles manufactured after January 2008 contain a different wiring harness than Porsche 911 vehicles manufactured before January 2008. Id.

         3. Porsche's Omissions About the Wiring Harness Defect

         Plaintiff alleges that Porsche knew about the defect “by the time that Plaintiff's 2007 model year was first sold, ” as evidenced by the ATI that Porsche issued to dealerships in January 2008. Id. ¶ 13. Plaintiff also alleges that Porsche received numerous customer complaints and “a host of message boards for aggrieved Porsche owners has arisen online” about the defect. Id. ¶ 9, 13.

         Plaintiff alleges that, although Porsche issued the ATI to dealerships, Porsche “never made any disclosure to consumers or the putative class members about the defect plaguing the Class Vehicles.” FAC ¶ 13. Moreover, although Porsche changed the wiring harness for vehicles manufactured after January 2008 “that no longer presents the alleged defect, ” Porsche “took no action with respect to the Class Vehicles.” Id. ¶ 15.

         B. Procedural History

         Plaintiff filed a class action lawsuit against Porsche on April 19, 2016. ECF No. 1. Plaintiff alleged causes of action under the CLRA and UCL. Id.

         Porsche moved to dismiss the complaint on June 3, 2016. ECF No. 12. Specifically, Porsche argued that Plaintiff did not sufficiently allege that Porsche had a duty to disclose the defect; that Plaintiff failed to sufficiently plead Porsche's knowledge at the time of sale; and that Plaintiff did not sufficiently plead that Plaintiff engaged in a “transaction” with Porsche for purposes of the CLRA. Id. Porsche also asserted that Plaintiff lacked standing to seek injunctive relief. Id. Plaintiff filed an opposition to Porsche's motion to dismiss on June 17, 2016, ECF No. 19, and Porsche filed a reply on June 30, 2016, ECF No. 22.

         On August 25, 2016, this Court granted in part and denied in part Porsche's motion to dismiss. Butler v. Porsche Cars N.A., 2016 WL 4474630 (N.D. Cal. Aug. 25, 2016). Specifically, the Court held that Plaintiff had adequately alleged that the “defect in the wiring harness posed a safety hazard that gave rise to a duty to disclose the defect.” Id. at *4. The Court also held that Plaintiff adequately alleged that Porsche had knowledge of the defect at the time that Plaintiff's car was originally sold in May 2007, and that Plaintiff satisfied the “transaction” requirement of the CLRA. Id. at *5-6. However, the Court concluded that Plaintiff lacked standing to seek an injunction compelling Porsche to replace the wiring harness because Plaintiff had already replaced his faulty wiring harness with a “next-generation” wiring harness, and there were no allegations that Plaintiffs new wiring harness was defective. Id. at *8.

         On September 7, 2016, Plaintiff filed a FAC, which maintained the same causes of action but removed Plaintiffs request for injunctive relief. See FAC. On September 26, 2016, Porsche answered the FAC. ECF No. 40.

         On January 26, 2017, Plaintiff filed a motion for class certification, in an addition to a sealing motion. ECF Nos. 44 & 45 (“Mot.”). Plaintiffs motion for class certification seeks to certify the following proposed classes:

• CLRA Class: All natural persons who purchased a Porsche 911 vehicle of model year 2005 through model year 2008 (manufactured before February 2008) ...

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