Jaime Gonzalez v. Owens Corning
885 F.3d 186
| 3rd Cir. | 2018Background
- Homeowners from PA, IL, TX, and CA sued Owens Corning alleging Oakridge shingles were defectively designed and would fail before their long warranties expired, causing damage and replacement costs.
- Plaintiffs sought certification of (1) a Four-State class (owners with Oakridge shingles installed 1992–2012 that manifested cracking/degranulation/deterioration during warranty) under Rule 23(b)(3) or as an issue class under Rule 23(c)(4), and (2) a Nationwide class (owners who purchased shingles on or before Sept. 26, 2006) to obtain a classwide ruling that Frenville governs dischargeability of claims post‑bankruptcy.
- Owens Corning had a 2006 confirmed reorganization plan; this Court in Wright v. Owens Corning held Frenville (not Grossman’s) governs dischargeability for claims predating Grossman’s, and Owens Corning represented it would not assert a discharge defense against these plaintiffs.
- During the 20‑year class period Owens Corning made many Oakridge shingle types (23 kinds, ~500 specifications); plaintiffs’ expert tested 298 returned shingles and opined many were at the low end of spec, but acknowledged that individual inspection is required to determine defectiveness.
- The District Court denied certification of both classes: it held the Nationwide class failed Rule 23(a) commonality because the question sought would be advisory (not justiciable under Article III), and the Four‑State class failed Rule 23(b)(3) predominance because plaintiffs could not prove a common design defect by classwide evidence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Justiciability / Nationwide class: whether a classwide declaration that Frenville governs dischargeability is a proper common question | Wright should bind class; a class ruling that Frenville applies would prevent inconsistent collateral‑estoppel outcomes | Owens Corning had disavowed raising discharge defense; a classwide ruling would be advisory and not resolve individual discharge questions | Denied: common question not justiciable under Article III; would be advisory and lack practical utility |
| Predominance / Four‑State class: whether defective design can be proven with classwide evidence | Plaintiffs’ “shingle‑lottery” theory: specifications set ranges that permit some shingles to be defective, so the design itself is a common defect amenable to class proof | Design varies across 23 shingle types and ~500 specs; many shingles meet warranty; defectiveness requires individual inspection so common proof unavailable | Denied: plaintiffs failed Rule 23(b)(3) predominance because essential defect element cannot be proven mostly with common evidence |
| Admissibility of expert (Rutila) testing evidence | Rutila’s testing of 298 returned shingles shows widespread low‑end manufacture and supports common proof | Sample biased (warranty returns), statistically insignificant vs. millions of shingles; Daubert exclusion appropriate | Court excluded testing‑based opinions, but appellate ruling rests on predominance independent of that exclusion; exclusion not necessary to decide certification denial |
| Rule 23(c)(4) liability‑only/Amgen merits inquiry objection | If liability is common, a liability‑only or class certification is appropriate; Amgen bars merits probing at certification | Plaintiffs’ liability theory is legally novel and incoherent; district court may and must conduct a rigorous, sometimes merit‑overlapping, analysis to test Rule 23 requirements | Denied: issue class inappropriate because liability is not susceptible to classwide proof; district court did not violate Amgen when it rigorously assessed defect theory |
Key Cases Cited
- Amgen Inc. v. Connecticut Ret. Plans & Tr. Funds, 568 U.S. 455 (2013) (district courts should not engage in free‑ranging merits inquiries but may consider merits to the extent relevant to Rule 23)
- Wright v. Owens Corning, 679 F.3d 101 (3d Cir. 2012) (this court held Frenville governs dischargeability for claims predating Grossman’s)
- JELD‑WEN, Inc. v. Van Brunt (In re Grossman’s Inc.), 607 F.3d 114 (3d Cir. 2010) (adopted rule that claim arises when claimant was exposed to product or conduct)
- In re M. Frenville Co., 744 F.2d 332 (3d Cir. 1984) (pre‑Grossman’s standard: claim arises under state law limitations/discovery rules)
- In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305 (3d Cir. 2009) (Rule 23 certification requires rigorous, evidence‑based analysis of predominance)
- Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 259 F.3d 154 (3d Cir. 2001) (actual, not presumed, conformance with Rule 23 is essential)
- Gen. Tel. Co. of the Sw. v. Falcon, 457 U.S. 147 (1982) (district court must perform rigorous analysis to ensure Rule 23 prerequisites are met)
- Step‑Saver Data Sys., Inc. v. Wyse Tech., 912 F.2d 643 (3d Cir. 1990) (factors for assessing whether declaratory relief presents a justiciable case or controversy)
- Coffin v. Malvern Fed. Sav. Bank, 90 F.3d 851 (3d Cir. 1996) (bankruptcy order addressing non‑justiciable issue constituted advisory opinion)
- Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036 (2016) (representative statistical evidence may satisfy predominance where common question determines liability and only damages require individual proof)