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Whirlpool v. Glazer

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The Sixth Circuit, in a decision that pays only lip service to Wal-Mart v. Dukes while ignoring its requirements for finding commonality, affirmed the certification of a single Ohio class in a consumer-fraud class action against Whirlpool over 21 different models of front-loading washers over a nine-year class period. Like every other environmentally-friendly energy-and-water-saving front-loading washer, Whirlpool washers, if not properly maintained, have a small percentage chance (and a slightly larger chance than for the old technology of top-loading washers) of generating unpleasant odors from laundry residue: does that create compensable injury for purchasers who never suffered this problem? Of course, as in many class actions, the attorneys are less interested in consumer redress for nonexistent harms, so much as imposing litigation expense that would prompt a settlement payment to the attorneys. In a Washington Times op-ed, Tiger Joyce complains "Beyond the urgent question of class certification, the 6th Circuit's opinion being appealed also establishes a radical new theory of product liability. In essence, it says that even if just one buyer of a manufactured product might one day become dissatisfied with the product, even if proper product maintenance would have prevented that dissatisfaction, and even if the product is otherwise widely and enthusiastically embraced in the marketplace, everyone who ever bought the product has, by definition, been overcharged and can be joined in a class action against the manufacturer." The theory is analogous to a fraud-on-the-market theory in securities law transposed to consumer law. Of course, one buys securities to make money, while one buys washing machines to wash clothes. If your clothes are washed satisfactorily, have you really been injured any more than by the fact that you mistakenly failed to buy your washer at Sears instead of Best Buy and inadvertently paid too much?

Of course, this particular question of Ohio law and public policy isn't before the Supreme Court, which generally doesn't intervene in error-correction of federal interpretations of state law, though there is an attempt to resuscitate the First American Federal question of class standing that the Supreme Court chose not to resolve last year in the cert brief itself. This case does not seem like the best of vehicles to make that stand.

But the commonality issue certainly seems cert-worthy, and even GVR-worthy. In terms of the certification, it's hard to see a common issue, given the different designs and different states of manufacturer and consumer knowledge over that time, and the Sixth Circuit opinion doesn't even try to distinguish Dukes. How is Whirlpool supposed to defend itself in a trial over such a wide-ranging class? Note that, while this is "just" a class action over Ohio consumers and Whirlpool washers, the same sort of case is being brought against every washer manufacturer.

I don't quite understand Joyce's reasoning in claiming "the future of all manufacturing in the United States hangs in the balance"—foreign manufacturers selling here will get sued just the same as American manufacturers will. It is, however, a litigation tax on consumers who face higher prices to compensate for the expense of lawsuits like this, and thus a wealth transfer from middle-class consumers to wealthy lawyers.

More: cert petition; Chamber amicus; PLAC amicus; PLF amicus; Wajert; PLF; Karlsgodt. The matter (No. 12-322) was to come up for conference Friday, but the Court has requested a response from the respondents, which is a better-than-average, though not dispositive, sign.

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.