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Cardenas v. Toyota Motor Corp.

United States District Court, S.D. Florida, Miami Division

September 25, 2019

JAVIER CARDENAS and KURT KIRTON, Plaintiffs,
v.
TOYOTA MOTOR CORPORATION, TOYOTA MOTOR SALES, U.S. A., INC., TOYOTA MOTOR ENGINEERING & MANUFACTURING, INC., and SOUTHEAST TOYOTA DISTRIBUTORS, LLC, Defendants.

          ORDER DENYING DEFENDANTS' MOTION TO STAY OR TRANSFER

          FEDERICO A. MORENO UNITED STATES DISTRICT JUDGE.

         This class action lawsuit is about whether certain Toyota entities defrauded consumers and engaged in unfair trade practices by concealing a defect in the heating, ventilation, and air conditioning systems installed in 2012-2017 Toyota Camrys and Camry Hybrids. The Plaintiffs allege the Toyota entities' fraudulent conduct violates the Racketeering Influenced and Corrupt Organizations Act, the Magnuson-Moss Warranty Act, Florida's Deceptive and Unfair Trade Practices Act, and the Tennessee Consumer Protection Act, breaches the implied warranty of merchantability, and constitutes common law fraud or fraudulent concealment.

         The Defendants believe this lawsuit is a "copycat class action" involving claims substantially similar to those being litigated in three other ongoing class actions against Toyota Motor Sales, U.S.A., Inc. that are currently pending in the Central District of California. For this reason, the Defendants ask the Court to transfer this action to California pursuant to the "first-to-file" rule or the federal transfer statute. The Plaintiffs strongly disagree and insist this lawsuit belongs in Florida because there is a named Florida plaintiff, and because there are Florida statutory and common law claims asserted against (among others) one Florida defendant, concerning conduct that occurred in Florida. The Plaintiffs further attest the proposed classes in this lawsuit do not overlap with the certified class or proposed classes in the pending California class actions.

         THE COURT has considered the moving papers and oral argument, the pertinent portions of the record, and is otherwise fully advised in the premises. For the reasons below, the Defendants' Motion to Stay or Transfer this Action to the Central District of California (D.E. 25) is DENIED.

         DISCUSSION

         The Defendants[1] assert there are sufficient grounds to transfer this action to California pursuant to the "first-to-file" rule or the federal transfer statute in 28 U.S.C. Section 1404(a). The Defendants direct the Court to look at the allegations in three ongoing class actions against Toyota Motor Sales, U.S.A., Inc. that are currently pending in the Central District of California: Salas v. Toyota Motor Sales, U.S.A., Inc., No. 2:15-cv-08629-FMO-E (CD. Cal., filed Nov. 4, 2015) ("Salas"); Stockinger v. Toyota Motor Sales, U.S.A., Inc., No. 2:17-cv-00035-VAP-KS (CD. Cal., filed Jan. 3, 2017) ("Stockinger"); and Beil v. Toyota Motor Sales, U.S.A., Inc., No. 2:17-cv-07079-VAP-KS, (CD. Cal., filed Sept. 25, 2017) ("Beil") (collectively, the "California Actions"). Alternatively, the Defendants ask the Court to stay this lawsuit pending a result in the upcoming class action trial in Salas.

         The Defendants point out that each case revolves around the same alleged heating, ventilation, and air conditioning system defect (i.e. the system fails to properly remove all humidity and water; and consequently, emits foul, noxious, and toxic odors into the vehicle passenger compartment, which exposes passengers to serious health and safety hazards, such as mold and other contaminants).[2] The Plaintiffs disagree that transfer is warranted under either the "first-to-file" rule or Section 1404(a).

         I. THE "FIRST-TO-FILE" RULE

         "Where two actions involving overlapping issues and parties are pending in two federal courts, there is a strong presumption across the federal circuits that favors the forum of the first-filed suit under the first-filed rule." Manuel v. Convergys Corp., 430 F.3d 1132, 1135 (11th Cir. 2005) (citations omitted). But, as this Court has recognized, the first-to-file rule "is not a hard-and-fast rule." Pompano Imports, Inc. v. BMW of N. Am., LLC, No. 15-23491-CIV, 2015 WL 12556151, at *2 (S.D. Fla. Nov. 10, 2015) (citing Manuel, 430 F.3d at 1135). Rather, it "simply creates a presumption in favor of the forum of the first-filed action, which can be overcome by compelling circumstances. Id. As such, the parties objecting to jurisdiction in the first-filed forum, here the Plaintiffs, carry the burden of proving the "compelling circumstances" necessary to justify an exception to the first-to-file rule. Manuel, 430 F.3d at 1135.

         In deciding whether the first-to-file rule applies, courts consider: "(1) the chronology of the two actions, (2) the similarity of the parties, and (3) the similarity of the issues." Lianne Yao v. Ulta Beauty Inc., No. 18-22213-CIV-ALTONAGA, 2018 WL 4208324, at *1 (S.D. Fla. Aug. 8, 2018) (citing Women's Choice Pharms., LLC v. Rook Pharms., Inc., No. 16-cv-62074, 2016 WL 6600438, at *2 (S.D. Fla. Nov. 8, 2016)). Ultimately, courts are afforded "an ample degree of discretion" in applying the first-to-file rule. Strother v. Hylas Yachts, Inc., No. 12-80283-CV, 2012 WL 4531357, at *1 (S.D. Fla. Oct. 1, 2012) (quoting Merial Ltd. v. Cipla Ltd., 681 F.3d 1283, 1299 (Fed. Cir. 2012) (quoting Kerotest Mfg. Co. v. C-O-Two Fire Equip. Co., 342 U.S. 180, 183-84 (1952))).

         The Defendants argue the parties and claims in this lawsuit are substantially similar to, and overlapping with, the parties and claims in the California Actions. The Plaintiffs contend that the Defendants oversell this argument, and maintain this lawsuit is substantially dissimilar to the California Actions because this lawsuit involves different classes of plaintiffs, different defendants, new claims-and in certain instances, different vehicle makes and models. After full consideration of the moving papers and oral argument, the Court finds the Plaintiffs have met their burden of establishing the "compelling circumstances" necessary to warrant an exception to the "first-to-file" rule.

         At the outset, the proposed classes in this lawsuit differ significantly from the narrow certified-class in Salas, and the proposed classes in Stockinger and Beil. The court in Salas already certified a "California-only class consisting of all persons in California who purchased or leased a 2012-2015 Toyota Camry XV 50 model vehicle from an authorized Toyota dealer." See Salas v. Toyota Motor Sales, U.S.A., Inc., No. CV 15-8629 FMO (EX), 2019 WL 1940619, at *14 (CD. Cal. Mar. 27, 2019) (emphasis added). And in Stockinger and Beil, the plaintiffs seek to certify a nationwide class, multiple statewide sub-classes, and several California statute based subclasses-but strikingly, these proposed classes comprise owners and lessees of make and model vehicles that are not involved in this lawsuit: Beil involves only 2013-2017 Lexus ES series models, and Stockinger involves a myriad of 2006-2015 Toyota and Lexus model vehicles, none of which include any Toyota Camry models. See Stockinger, No. 2:17-cv-00035-VAP-KS, ECF No.34 at ¶¶ 2, 73 (CD. Cal. Mar. 24, 2017); Beil, No. 2:17-cv-07079-VAP-KS, ECF No.1 at ¶¶ 1, 75 (CD. Cal. Sept. 25, 2017).

         - As a notable aside, the Salas court already declined in separate orders to accept transfer of the Stockinger and Beil actions into its docket for the precise reason that those cases "would not entail a substantial duplication of labor if heard by different judges, " since those cases involved different vehicle makes, models, and model years. (See D.E. 33 at 30, 32.) The court in Salas noted that Beil involved only 2013-2017 Lexus ES vehicles, and described Stockinger as involving "every other vehicle manufactured by Toyota, and for vastly different years." Id. At the time of these denials, the Salas court was well acquainted with the parties and claims, having presided over that case for more than a year when it denied transfer of Stockinger, and nearly two years when it denied transfer of Beil. Thus, if Stockinger and Beil were not substantially similar enough to Salas to warrant an intra-district transfer, then this lawsuit is certainly not substantially similar enough to Stockinger and Beil to transfer it across the country.

         Turning back, then, to the proposed classes in this case, the Plaintiffs seek to certify classes of owners and lessees of 2012-2017 Toyota Camrys and Camry Hybrids. (D.E. 1 at ¶¶ 2, 95.) Thus, the Plaintiffs here seek class certification regarding vehicles that are not involved in Stockinger and Beil at all. And while a class of California owners and lessees of 2012-2015 Toyota Camry XV 50 models has been certified in Salas, here, the Plaintiffs made clear at oral argument that in light of Salas, they are now seeking-in addition to the Florida and Tennessee statewide classes they sought before-a nationwide class that excludes California. Consequently, the proposed classes in this lawsuit do not overlap with the certified class in Salas, or the proposed classes in Stockinger and Beil. In essence, this lawsuit fills the large gap left by the narrow class that was certified in Salas. Furthermore, to the extent this lawsuit is similar to Salas because ...


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