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Gustafson v. Goodman Manufacturing Co. LP

United States District Court, D. Arizona

March 14, 2016

James Gustafson, Plaintiff,
Goodman Manufacturing Company LP, et al., Defendants.


James A. Teilborg Senior United States District Judge

Pending before the Court are three motions: (1) Plaintiff’s Motion to Certify Class (Docs. 54, 78);[1] (2) Defendants’ Motion to Exclude Certain Opinions of Paul J. Sikorsky and Memorandum in Support (Docs. 84, 115);[2] and (3) Defendants’ Motion to Strike Supplemental Declaration of Paul J. Sikorsky in Further Support of Plaintiff’s Motion For Class Certification (Doc. 96). The Court now rules on the motions.[3]

I. Background

A. Factual Background

Defendants Goodman Manufacturing Company, L.P. and Goodman Global, Inc. (collectively “Goodman”) manufacture the principal components of air-conditioning systems, such as air conditioners and heat-pumps, under the Goodman and Amana brand names. (Doc. 120-2 at 12). Goodman does not market and sell its products directly to consumers but markets to contractors and sells to independent distributors across the country. (Id.)

According to the facts as alleged by Plaintiff, in or around March 2010, Plaintiff purchased two Goodman heat-pumps from Carey’s Air Conditioning Heating & Plumbing (“Carey’s”), a Goodman distributor, for approximately $16, 500. (Doc. 79 at 2).[4] At that time, Plaintiff purchased an extended 10-year parts and labor warranty for his units. (Id.) Under the terms of the extended warranty, Plaintiff was not required to pay for any parts and labor costs associated with repairs of his heat-pumps. (Id.) Before he purchased the heat-pumps, Plaintiff alleges that he reviewed Goodman’s official company website and learned of the high quality of Goodman’s products. (Id.)[5]

Plaintiff purportedly had numerous problems with his Goodman air conditioners throughout the next twenty-four months. (Id.) During this period, Plaintiff claims that he called Carey’s more than a dozen times about various heating and cooling issues with his units. (Id.) In July 2011 and January 2012, Plaintiff submitted warranty claims on his units’ condenser coils, which Goodman replaced without charge. (Doc. 119-5 at 14). In or around March 2013, after multiple on-site engagements, Carey’s refused to service Plaintiff’s units anymore because doing so was cost prohibitive. (Doc. 79 at 3).[6] It is undisputed that Carey’s did not charge Plaintiff for the parts and labor costs associated with the repairs throughout this period. (Id.)

In or around March 2013, Plaintiff purchased a bi-annual maintenance agreement from River Valley Air Conditioning, Inc. (“River Valley”) for $266.00. (Id.) The terms of this agreement are as follows:

Central air conditioning equipment and furnaces are durable and dependable, but like all mechanical equipment they perform best when they are routinely serviced. Living in the desert area with its intense heat in the summer, our equipment takes a lot more abuse than equipment located in areas with cooler temperatures.
With that in mind, River Valley Air Conditioning, Inc., has a maintenance program that we would like you to consider putting into action. This program is set up to take care of the maintenance needs of your equipment and give you the added piece of mind that your system will be operational and able to withstand the extreme temperatures and abuse during the summer and winter months. The best time to have your equipment serviced is before the season get [sic] in full swing. We recommend that you service your equipment twice a year, once in the spring, and once in the fall. This service will give your system added equipment life and better operating efficiency.
Once you sign up for the preventive maintenance program, you are then scheduled for service at your convenience, but both services must be completed within a year of purchase. On the next page you will see the breakdown of all the work that is completed during these maintenance calls. The cost of the yearly maintenance agreement is $168.00 and is paid when you sign up for the program. This will give you several advantages over other customers who DO NOT have this agreement. As a maintenance agreement customer you will receive priority service if any emergency service calls are needed, and you will receive a major price reduction for services and parts on any future service call repairs.
Preventive maintenance does not guarantee that your unit will not have a break down, but it does help to catch some of the problems before they arise, and a properly serviced system will save you operating cost and help to prolong the life of your system.
Our program covers one (1) heating and one (1) cooling maintenance per system, per year. If you have more than one system, you can add additional systems for $98.00 each.


(Doc. 1 at 35). On July 1, 2013, a River Valley technician determined that one of Plaintiff’s heat-pumps had low refrigerant levels due to a purported leak in the evaporator coil. (Docs. 119-1 at 22). Less than two weeks later, a River Valley technician came to the same conclusion while inspecting Plaintiff’s second heat-pump. (Id.) According to Plaintiff, River Valley technicians went to his house “no fewer than 9 separate times to repair [his] Goodman Units, either by replacing Freon from a leaking evaporator coil, or repairing and/or replacing any other parts needing service.” (Doc. 79 at 3). Finally, in July 2015, River Valley refused to service Plaintiff’s heat-pumps because doing so was cost prohibitive. (Id.)

Plaintiff alleges that had he “known of the evaporator coil defects in the Goodman Products, he would have never purchased his two Goodman air conditioning units and installed them in his home.” (Id. at 4).[7] Plaintiff does not claim, beyond the maintenance agreement itself, that he incurred any other labor costs related to repairing the evaporator coils during the period his heat-pumps were being serviced by River Valley. (Doc. 85-19 at 3).[8]

B. Parallel Litigation

Parallel litigation is ongoing in several district courts throughout the country, including before Judge David O. Carter in the Central District of California. See McVicar v. Goodman Global, Inc., No. SA CV 13-1223-DOC(RNBx) (C.D. Cal.). McVicar involves the same defendants; defensive discovery; theory of alleged defect; alleged misrepresentations and omissions; damages theory; and, with one exception, experts. Judge Carter ultimately denied certifying the proposed class based on consumer fraud statutes, false advertising, breach of implied warranty, and warranty claims under the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301. See McVicar v. Goodman Global, Inc., 2015 WL 4945730, at *15 (C.D. Cal. Aug. 20, 2015), perm. app. denied, 15-80164 (9th Cir. Nov. 15, 2015). Judge Carter’s rulings are not binding on this Court and will be reviewed for their persuasive value only.

C. Air Conditioners

Judge Carter provided a general description of air conditioners-which are comprised of the same components as heat-pumps-that the Court adopts:

A residential air conditioner is comprised of three primary components: (1) an evaporator coil; (2) a condenser coil; and (3) a compressor. The three components are connected in a hermetic system with a refrigerant, such as Freon. The two coils are the key components in removing heat from inside the home and exhausting it outside. The coils at issue in this care [sic] are made with small diameter copper tubes (called hairpins) and copper u-bends that are brazed together in a continuous fashion so that refrigerant can pass through the coil to other components of the air conditioner.

McVicar, 2015 WL 4945730, at *3. This lawsuit concerns the same copper coils that were at issue before Judge Carter.

D. Procedural Background

Plaintiff, a resident of Arizona, brings this lawsuit on behalf of himself and similarly situated consumers located in Arizona. (Doc. 119-1 at 6). Plaintiff alleges that Goodman knowingly manufactured and sold air-conditioning systems with inherently defective evaporator coils and did not disclose the defect to purchasers. (Id. at 6-7). Due to Goodman’s knowledge of the alleged defect, Plaintiff claims that it was unconscionable for Goodman’s Limited Warranty to exclude labor costs associated with evaluating, replacing, or servicing an evaporator coil. (Id. at 20).

Plaintiff filed his original class action complaint on November 20, 2013. (Doc. 1). Plaintiff’s original complaint alleged that Goodman breached an express warranty and violated Arizona’s Consumer Fraud Act. (Id. at 26-27). On January 27, 2014, Goodman moved to dismiss the complaint in its entirety. (Doc. 10) The prior Judge granted Goodman’s motion to dismiss, but permitted Plaintiff to amend his complaint as to the express warranty claim. (Docs. 10, 22). On May 20, 2014, Plaintiff timely filed his First Amended Complaint (“FAC”) which sets forth only one cause of action: breach of express warranty. (Doc. 24 at 28-29). Goodman timely filed its Answer on June 17, 2014. (Doc. 27).

On July 20, 2015, Plaintiff filed a Motion to Certify Class and requested that the entire motion and several of its exhibits be filed under seal. (Docs. 53, 54). On August 24, 2015, the prior Judge permitted Plaintiff to file the entire motion and a majority of the supporting documents under seal. (Doc. 65). Upon being reassigned this case, this Court ordered Plaintiff to file a redacted, unsealed motion for class certification, which Plaintiff submitted on November 9, 2015. (Docs. 76, 78). In response, Goodman filed its opposition to class certification and a motion to exclude the declaration of Paul J. Sikorsky, Plaintiff’s expert. (Docs. 84, 85). On December 17, 2015, Plaintiff filed a supplemental declaration of Mr. Sikorsky providing further support for class certification, which Goodman moved to strike as untimely. (Docs. 92, 96).

II. Class Certification

Plaintiff seeks class certification of one class (“Class”):

All individuals and entities in the State of Arizona who purchased air conditioners, air handlers and heat-pumps manufactured by Goodman within the applicable statute of limitations periods established by the state of Arizona (“Class Period”) through the final disposition of this and any and all related actions, and who incurred damages as a result of having to repair their Goodman Products due to leakage of refrigerant.

(Doc. 78 at 2). Plaintiff “requests certification of the above-defined Class for violations of (i) breach of express warranty under Ariz. Rev. Stat. § 47-2313; (ii) breach of any implied warranty of fitness for intended and ordinary purpose; and (iii) unjust enrichment.” (Id. at 3-4).

Plaintiff seeks class certification for three causes of action yet only one of his claims-beach of express warranty-was pleaded in his FAC. See (Doc. 24 at 28-29). Without citing any authority, Plaintiff argues that “[a]s a procedural device, Rule 23 is not rigidly tied to only those claims expressly plead [sic]; the complaint can be amended and Defendants may then file a motion to dismiss if Defendants so choose.” (Doc. 119-5 at 18). The operative complaint has yet to be amended to include Plaintiff’s two additional claims, and a motion for class certification is an improper platform for Plaintiff to advance new claims that he did not plead in his FAC. See Anderson v. U.S. Dep’t of Hous. & Urban Dev., 554 F.3d 525, 529 (5th Cir. 2008) (“[T]he district court abused its discretion by certifying a class based on claims not pleaded in the complaint.”); Guadiana v. State Farm Fire & Cas. Co., 2009 WL 6325542, at *8 (D. Ariz. Dec. 18, 2009) (holding that a “theory of the case . . . not raised in [a plaintiff]’s amended complaint . . . . cannot form the basis for class certification”); In re Toyota Motor Corp. Hybrid Brake Mktg., Sales Practices & Prods. Liab. Litig., 288 F.R.D. 445, 448 n.4 (C.D. Cal. Jan. 9 2013) (“A motion for class certification is not the appropriate mechanism to introduce new claims.” (citing Couglin v. Sears Holding Corp., 2010 WL 4403089, at *2 (C.D. Cal. Oct. 26, 2010))). Absent ...

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