Pamella Montgomery v. Kraft Foods Global, Inc.
822 F.3d 304
| 6th Cir. | 2016Background
- Plaintiff Pamella Montgomery bought a Kraft-manufactured Tassimo brewer labeled “Featuring Starbucks® Coffee” and expected to brew Starbucks coffee.
- After purchase Starbucks T-Discs (compatible pods) became difficult or impossible to obtain due to Kraft–Starbucks distributionship disputes.
- Montgomery sued Kraft and Starbucks on behalf of a putative class under the Michigan Consumer Protection Act (MCPA) and for innocent misrepresentation, breach of express and implied warranties, and breach of contract.
- The district court dismissed the warranty and contract claims, denied class certification of the remaining consumer-protection claims, and left some MCPA issues for adjudication.
- Defendants made a joint Rule 68 offer: $250 statutory MCPA damages plus reasonable fees and costs for Montgomery’s individual claims; she accepted and sought $174,786.50 in fees and $5,183.56 in costs.
- The district court awarded only $6,767 in fees and costs; Montgomery appealed the warranty dismissals, the denial of class certification, and the fee award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Montgomery pleaded breach of an express warranty enforceable by her | Montgomery argued the packaging and the Kraft–Starbucks arrangement created express warranties and that she could enforce them | Defendants contended Michigan requires privity for express-warranty recovery by remote purchasers (no privity here) | Court affirmed dismissal: Michigan precedent requires privity for express-warranty claims and Montgomery lacked privity; her third-party-beneficiary theory was abandoned |
| Whether implied warranty of merchantability was pleaded | Montgomery argued the brewer impliedly warranted continued availability/use with Starbucks T-Discs | Defendants argued the brewer was merchantable when sold and Michigan requires defect at time goods left seller | Court affirmed dismissal: implied-warranty claims dispense with privity but complaint failed to allege the brewer was unfit at sale or nonconforming to label promises |
| Whether settlement under Rule 68 moots appeal of class-certification denial | Montgomery reserved her right to appeal class-certification denial despite accepting the Rule 68 judgment | Defendants argued acceptance of Rule 68 (including fees and costs) removed any personal stake and mooted the class-certification appeal | Court dismissed class-certification appeal as moot: Pettrey controls; acceptance of a fee-and-cost-inclusive Rule 68 eliminated any personal interest in class relief |
| Whether the district court abused discretion in awarding only a small fraction of requested attorney’s fees | Montgomery argued the small award effectively nullified the right to fee recovery under the Rule 68 judgment | Defendants argued Montgomery inadequately briefed/argued the fee challenge and district court acted within discretion | Court affirmed fee award: Montgomery forfeited substantive challenge by inadequate briefing and court did not abuse discretion |
Key Cases Cited
- Deposit Guar. Nat’l Bank v. Roper, 445 U.S. 326 (Sup. Ct. 1980) (settlement and preservation of appellate stake on fee-shifting grounds in class context)
- Pettrey v. Enter. Title Agency Inc., 584 F.3d 701 (6th Cir. 2009) (acceptance of fee-and-cost-inclusive settlement moots class-certification appeal)
- Pack v. Damon Corp., 434 F.3d 810 (6th Cir. 2006) (Michigan implied-warranty privity rule and related UCC discussion)
- Heritage Res., Inc. v. Caterpillar Fin. Servs. Corp., 774 N.W.2d 332 (Mich. Ct. App. 2009) (Michigan Court of Appeals requiring privity for express-warranty enforcement by remote purchasers)
- Ashcroft v. Iqbal, 556 U.S. 662 (Sup. Ct. 2009) (plausibility pleading standard under Rule 8)