By Juan Carlos Rodriguez
Law360, New York (January 08, 2014, 1:33 PM ET) — A New Jersey federal judge on Monday shot down Bridgestone Americas Tire Operations LLC and BMW of North America LLC’s bid to toss a proposed class action accusing the companies of selling defective tires, finding the allegations have been adequately pled.
Plaintiff David Greene has alleged that the Potenza Run Flat Tires on his leased BMW 335i convertible provided him with an unreliable and dangerous ride by forming dangerous sidewall bubbles within one year of leasing the car. BMW sought to trim the New Jersey Consumer Fraud Act claim from Greene’s second amended complaint, but U.S. District Judge William J. Martini said although he dismissed it in a previous complaint, he will allow it to proceed.
“In its prior opinion, the court dismissed Greene’s NJCFA claim against BMW because Greene failed to allege that BMW knew with certainty that the tires would fail,” Judge Martini said. “The SAC cures this defect: It alleges, upon information and belief, that BMW ‘knew with certainty that the tires would fail.’”
The judge rejected BMW’s argument that because Greene’s “information and belief” allegation does not satisfy the plausibility pleading requirements under Twombly, he has not stated an NJCFA claim. The judge said the Second Circuit has held that the Twombly plausibility standard does not prevent a plaintiff from pleading facts alleged upon information and belief where the facts are “peculiarly within the possession and control of the defendant or where the belief is based on factual information that makes the inference of culpability plausible.”
Judge Martini said if evidence exists that BMW knew about problems with the tires, that evidence is in BMW’s control, and that given that fact, and given that Greene has stated a claim for breach of implied warranty, it would be improper to dispose of Greene’s NJCFA claim at this stage of the litigation.
Bridgestone, in a separate argument, had said that Greene’s class allegations should be dismissed based on the Third Circuit’s decision in Marcus v. BMW of North America LLC, which held that breach of warranty claims required an individualized inquiry into why any particular consumer’s tires went flat and had to be replaced.
“In its prior opinion, the court held that it was premature to address similar arguments at the motion to dismiss stage. The court has not changed its mind. Accordingly, defendants’ motions to dismiss Greene’s class allegations are denied,” Judge Martini said.
Both companies had also argued that the class allegations should be dismissed because Greene didn’t fit his own class definition. In the second amended complaint, Greene refers to a class of lessors and purchasers of BMWs “whose tires had to be replaced after going flat,” and the companies argue Greene never alleges that his tires went flat.
The judge said Greene does not dispute that argument, but claims he made a “clerical error” when he amended the first amended complaint, which made no mention of flat tires, instead referring to tires that had to be “prematurely replaced as a result of their significantly reduced useful life as compared with other similar run-flat tire brands.”
Judge Martini said he would allow Greene to amend his complaint to modify the class definition.
Bridgestone noted that all charges have been dismissed against Bridgestone Americas Inc., and all but one count have been dismissed against Bridgestone Americas Tire Operations LLC.
“While we are disappointed in the ruling by the court to allow the remaining count against BATO to continue, we do not believe this case should be given class treatment and are confident the court will come to the same conclusion,” the company said in a statement.
Justin M. Klein of Marks & Klein LLP said his client is pleased with the decision and is looking foward to a trial.
BMW and its counsel did not immediately respond to requests for comment Wednesday.
Greene is represented by Barry R. Eichen and Daryl Zaslow of Eichen Crutchlow Zaslow & McElroy LLP and Justin M. Klein of Marks & Klein LLP.
BMW is represented by Rosemary Joan Bruno and Christopher J. Dalton of Buchanan Ingersoll & Rooney PC.
Bridgestone is represented by David R. King of Herrick Feinstein LLP.
The case is David Greene v. BMW of North America, et al., case number 2:11-cv-04220, in U.S. District Court for the District of New Jersey.
Additional reporting by Linda Chiem.
Editing by Jeremy Barker.