Man unsure of the safety of his medicine

Breaking news and expert analysis on legal and compliance issues

[Back To Home][Back To Archives]

From Products Liability Law Daily, June 23, 2016

Subaru unable to steer clear of consumers’ economic loss claims based on fraudulent concealment

By Greg Hammond, J.D.

Consumers have adequately alleged fraudulent concealment and state deceptive and unfair trade practices claims against Subaru of America, Inc., based on an alleged failure to disclose any information concerning defective airbags. The federal district court in Miami denied Subaru’s motion to dismiss the economic loss track cases, finding that the consumers met the heightened pleading requirements of Federal Rule of Civil Procedure 9(b) and sufficiently pleaded reliance, causation, and resulting damages (In re Takata Airbag Products Liability Litigation, June 20, 2016, Moreno, F.).

Consumers of vehicles that were equipped with Takata airbags containing ammonium nitrate as a propellant alleged that Subaru and other vehicle manufacturers engaged in fraudulent concealment and violated both the Alabama Deceptive Trade Practices Act (ADTPA) and Florida Deceptive and Unfair Trade Practices Act (FDUTPA). Subaru moved to dismiss.

As a preliminary matter, the court first determined that the consumers sufficiently alleged Subaru’s knowledge of the alleged inflator defect to satisfy the heighted pleading requirements of Rule 9(b).

ADTPA. Subaru first argued that the consumers’ claims of fraudulent concealment and violation of the ADTPA should be dismissed because the plaintiffs have not met the heightened pleading requirements of Rule 9(b) and have not sufficiently pleaded reliance on the alleged concealment and resulting damages. The court disagreed, referring to its earlier decision regarding Mazda Motor of America, Inc.’s motion to dismiss the same claims. In particular, the court found that the plaintiffs sufficiently pleaded the "who, what, when, and where" of their omission claim. The consumers had alleged that Subaru had a duty to disclose the inflator defect because it made incomplete representations about the safety and reliability of the class vehicles, while purposefully withholding material facts from consumers that contradicted those representations.

FDUTPA. The consumers also adequately alleged their FDTUPA claim, the court concluded, because they pleaded that Subaru’s alleged omissions and concealed material facts caused their injuries. In particular, the consumers claimed that but for Subaru’s omission of a dangerous safety defect—a highly material fact for consumers—plaintiffs would not have purchased class vehicles or would not have paid as much for them as they did.

The case is No. 1:15-md-02599-FAM.

Attorneys: John Delionado (Hunton & Williams LLP) for Plaintiffs. Martin Leonard Steinberg (Hogan Lovells US, LLP), Mitchell Edward Widom (Bilzin Sumberg Baena Price & Axelrod LLP) and Scott M. Sarason (Rumberger, Kirk & Caldwell) for FCA US LLC. Stephen J. Krigbaum (Carlton Fields Jorden Burt, P.A.) for Inflation Systems Inc.

Companies: FCA US LLC; Inflation Systems Inc.

MainStory: TopStory DamagesNews DesignManufacturingNews MotorVehiclesNews MotorEquipmentNews FloridaNews

Back to Top

Products Liability Law Daily

Introducing Wolters Kluwer Products Liability Law Daily — a daily reporting service created by attorneys, for attorneys — providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity.


A complete daily report of the news that affects your world

  • View full summaries of federal and state court decisions.
  • Access full text of legislative and regulatory developments.
  • Customize your daily email by topic and/or jurisdiction.
  • Search archives for stories of interest.

Not just news — the right news

  • Get expert analysis written by subject matter specialists—created by attorneys for attorneys.
  • Track law firms and organizations in the headlines with our new “Who’s in the News” feature.
  • Promote your firm with our new reprint policy.

24/7 access for a 24/7 world

  • Forward information with special copyright permissions, encouraging collaboration between counsel and colleagues.
  • Save time with mobile apps for your BlackBerry, iPhone, iPad, Android, or Kindle.
  • Access all links from any mobile device without being prompted for user name and password.