Nguyen v. Nissan N.A.

Class certification

9th U.S. Circuit Court of Appeals

Judge Milan D. Smith Jr.

Appellants' attorneys: Capstone Law APC, Ryan H. Wu, John E. Stobart

Appellee's attorneys: Faegre Drinker Biddle & Reath LLP, Alan J. Lazarus, Matthew J. Adler, Zoe K. Wilhelm, Adam J. Thurston, Sherman V. Wittie, E. Paul Cauley Jr.

Lawyers at Capstone Law APC obtained a rare appellate reversal of a class certification denial in a case over allegedly faulty hydraulic clutch systems in Nissan and Infiniti vehicles. A 9th U.S. Circuit Court of Appeals panel held that the plaintiff's proposed damages model is consistent with the class theory of liability, requiring reversal of U.S. District Judge Lucy H. Koh's denial of certification. Nguyen v. Nissan North America Inc. 932 F.3d 811 (9th Cir., opinion filed July 26, 2019).

Ryan H. Wu, a senior counsel at Capstone Law APC, argued the case before the panel for a class of thousands of California consumers. He said Koh mistakenly accepted the defense's argument that the plaintiff's damages model failed to account for consumers' ability to use the defective part before it failed. "The circuit said that's not the right way to approach the problem," said Wu. "You have to look at the part's condition at the point of sale."

More broadly, the reversal had positive implications for consumer law, Wu said. "There's been a trend toward a more complicated damages model in these cases. Judge Koh found ours too simple. We said the automaker should have informed the buyer when the car was sold, when safety is an issue. The circuit found that our simpler approach was best. Once the class is certified, the defense can challenge our theory of liability, but you can't cut the case off so early."

John E. Stobart

Ever since the U.S. Supreme Court's Comcast v. Behrend decision in 2013 in an antitrust class action, district courts have routinely rejected class certifications because of some perceived minor deficiency; the circuit's reversal could stanch that trend, Wu said.

Wu was backed by Capstone Law's John W. Stobart on the briefs. "At the oral argument, Judge Smith said from the bench that he didn't think he'd buy the car because he has kids," Stobart said. "It's really a straightforward argument when the seller does not tell you you have options regarding a defective part. Where Judge Koh went off was that she was unwilling to accept that you could simply calculate damages by adding the cost of the replacement part and the cost of labor. It's that simple."

Opposing counsel for the automaker at the oral argument was Alan J. Lazarus of Faegre Drinker Biddle & Reath LLP, who did not return a message seeking comment.

--John Roemer