Rutledge v. Hewlett-Packard Co.
238 Cal. App. 4th 1164
| Cal. Ct. App. | 2015Background
- This is a class action by California purchasers of HP Zinfandel notebook computers (models Zinfandel 3.5 and 4.0) alleging defective inverters caused display dimming/failure and that HP knew but concealed the defect. Representative plaintiffs are Degenshein and Giuliano-Ghahramani.
- Claims: violations of the Consumer Legal Remedies Act (CLRA), Unfair Competition Law (UCL), breach of express warranty, and unjust enrichment. The trial court granted summary adjudication/no-merits determinations on several claims and denied some class certification requests; appeal followed.
- Key factual evidence for plaintiffs: expert declaration (Langberg) opining design/installation defects in TDK and Ambit inverters, HP internal service notes and an HP engineer email showing awareness of inverter issues, call-center and repair data showing elevated inverter repairs.
- Warranty facts: HP provided a one-year express warranty and a 90-day repair warranty; Degenshein reported his failure after the one-year warranty expired, while Giuliano-Ghahramani reported and had multiple repairs during the warranty period.
- Procedural rulings challenged: (1) summary adjudication/no-merits determination on CLRA and UCL claims; (2) summary adjudication on breach of express warranty for each representative and class; (3) denial of nationwide class certification and denial of class certification for the CLRA claim; (4) several discovery sanctions orders.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether HP had a duty to disclose the inverter defect (CLRA/UCL fraudulent omission) | HP knew inverters were defective/likely to fail prematurely and its advertising created an expectation of reliable displays, so HP had a duty to disclose | No independent duty to disclose absent safety risk; alleged failures occur after sale/wear so nonactionable; press statements were puffery | Reversed trial court: triable issues exist on materiality, concealment, and HP knowledge — summary judgment/no-merits on CLRA/UCL improper |
| Adequacy of expert and proof of defect/notice (summary judgment) | Langberg’s opinions plus service notes, email, call/repair data create triable issues on defect and HP knowledge | Expert lacked some statistical specifics; many display problems have other causes, so evidence insufficient | Plaintiffs produced enough evidence to create triable factual disputes; summary adjudication for HP improper on UCL/CLRA claims |
| Breach of express warranty for Degenshein (late notice) | Constructive notice / latent defect that would fail within useful life excuses late notice | Warranty requires notice during one-year warranty; latent-failure theory cannot vitiate warranty time limits | Affirmed for Degenshein: failure to notify within warranty period bars his express-warranty claim |
| Breach of express warranty for Giuliano-Ghahramani (repeated repair failures) | Repeated inverter failures after multiple in-warranty repairs show HP failed to adequately repair and thus breached warranty | Repairs returned product operative during warranty; later failure post-warranty not actionable | Reversed for Giuliano-Ghahramani: triable issue whether HP’s repairs were inadequate and whether warranty was breached |
| Nationwide class certification (choice of law) | California has sufficient contacts (HP HQ, design, service, warranties, service notes) to apply CA law to nonresidents; other cases support nationwide certification | Applying CA law to out-of-state purchases may be unconstitutional and would displace other states’ laws and remedies | Reversed trial court: denial of nationwide class certification was error — CA has sufficient contacts and HP did not carry burden to show other states’ interests outweigh California’s |
| Certification of CLRA claims after merits rulings (one-way intervention) | Plaintiffs sought to certify CLRA claims later despite earlier proceedings | Allowing certification after merits rulings creates one-way intervention — unfair to defendant | Affirmed denial: certification of CLRA claims after adjudications would permit impermissible one-way intervention (Fireside Bank principle) |
| Discovery sanctions (untimely motion to compel and evidentiary sanctions) | Plaintiffs argued motion to compel timely and sought evidentiary sanctions against HP for withheld call data | Defendants argued plaintiffs delayed for years; evidentiary sanctions would be a windfall | Monetary sanctions against plaintiffs for untimely motion affirmed; denial of plaintiffs’ requested evidentiary sanctions affirmed (court acted within discretion) |
Key Cases Cited
- Aguilar v. Atlantic Richfield Co., 25 Cal.4th 826 (Cal. 2001) (summary judgment burden-shifting and no-merits standard)
- Daugherty v. American Honda Motor Co., 144 Cal.App.4th 824 (Cal. Ct. App. 2006) (no independent duty to disclose absent safety risk; warranty notice and latent-defect analysis)
- Bardin v. DaimlerChrysler Corp., 136 Cal.App.4th 1255 (Cal. Ct. App. 2006) (materiality of omission and consumer expectations in product defect claims)
- Collins v. eMachines, Inc., 202 Cal.App.4th 249 (Cal. Ct. App. 2011) (manufacturer duty to disclose material manufacturing defect that defeats core product function)
- Fireside Bank v. Superior Court, 40 Cal.4th 1069 (Cal. 2007) (prohibition on allowing class certification after merits rulings to avoid one-way intervention)
- Wershba v. Apple Computer, Inc., 91 Cal.App.4th 224 (Cal. Ct. App. 2001) (California contacts can support nationwide class where corporation’s decision-making and representations originate in California)
- Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (U.S. 1985) (constitutional limits on applying forum state law to absent class members)