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Churchill Vill., L.L.C. v. GE

Churchill Vill., L.L.C. v. GE

United States Court of Appeals for the Ninth Circuit

September 8, 2003, Argued and Submitted, San Francisco, California ; March 16, 2004, Filed

No. 01-17059, No. 02-15354, No. 02-15391, No. 02-16838, No. 02-16906

Opinion

 [*570]  O'SCANNLAIN, Circuit Judge:

We must decide various challenges to a class-action settlement of these suits against the manufacturer of consumer dishwashers.

Between 1983 and 1989, General Electric ("GE") manufactured and sold approximately three million GE- and Hotpoint-brand dishwashers equipped with a sliding "energy saver" switch. Although some were sold to individual consumers, the dishwashers were considered "low end" products and were primarily marketed to contractors, builders, and owners of commercial or rental properties. The switch, which allows a user to select either a heated drying cycle or drip drying, deteriorates over time and [**3]  may melt or ignite.

Reports of fires caused by the allegedly defective switch eventually prompted an investigation by the Consumer Product Safety Commission ("CPSC"). Although the investigation found that no consumers had been physically injured, it determined that approximately 50 fires could be attributed to the switch, three of which damaged property other than the dishwasher itself. Under the terms of a formal settlement agreement between GE and the CPSC, GE announced a "recall" of the dishwashers in October 1999. GE advised consumers to stop using the dishwashers immediately, and offered a choice between a $ 75-125 cash rebate toward the purchase of a GE-brand dishwasher or a $ 25 cash refund toward the purchase of a non-GE-brand dishwasher, along with a free one-year service agreement with GE. GE also agreed to replace dishwashers still under extended service agreements. The GE-CSPC agreement also permitted GE to reach a separate agreement with owners and operators of commercial and residential properties that could include discounted bulk pricing and instructions to repair the switch by rewiring. Dissatisfied with the rebate program, some consumers turned to the courts.

 [**4]  The first of the two underlying actions consolidated in this appeal was filed in  [*571]  November 1999. Churchill Village, L.L.C. ("Churchill"), an Oregon corporation and owner of an apartment building in Eugene, Oregon, sued GE both individually and on behalf of the general public in the Northern District of California, asserting claims under California's unfair competition and false advertising laws and seeking injunctive relief and restitution. Churchill asserted federal jurisdiction against GE (a New York corporation headquartered in Connecticut) based on diversity of citizenship, contending that injunctive relief as measured by the cost to the defendant exceeded the $ 75,000 amount-in-controversy requirement. See 28 U.S.C. § 1332. Jurisdiction over the state-law claims was asserted on the principles of supplemental jurisdiction in 28 U.S.C. § 1367. The complaint was later amended to add two individual plaintiffs, Al and Barbara Dorsett, citizens of California. Churchill and the Dorsetts then sought a preliminary injunction, which the district court denied on May 10, 2000. Churchill Village, L.L.C. v. GE, 169 F. Supp. 2d 1119 (N.D. Cal. 2000). [**5]  

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361 F.3d 566 *; 2004 U.S. App. LEXIS 4879 **; 58 Fed. R. Serv. 3d (Callaghan) 53

CHURCHILL VILLAGE, L.L.C., BARBARA DORSETT, and AL DORSETT individually and on behalf of the general public; BARBARA DORSETT; AL DORSETT; SEYMOUR LAZAR; JOAN CHALMERS; JUDITH SAPORTA, Plaintiffs, HARRIET SKURMAN; NORMAN HICKMAN; PHYLLIS HICKMAN; CRAIG ROSENFIELD, Intervenors, v. GENERAL ELECTRIC, INDIVIDUAL CONSUMER DISHWASHER LITIGATION, Defendant-Appellee, v. BECKWITH PLACE LIMITED PARTNERSHIP; SUSAN E. GLATTER KAMMAN, individually and on behalf of others similarly situated, Plaintiff-Intervenors-Appellants. CHURCHILL VILLAGE, L.L.C., BARBARA DORSETT, and AL DORSETT individually and on behalf of the general public; BARBARA DORSETT; AL DORSETT; SEYMOUR LAZAR; JOAN CHALMERS; JUDITH SAPORTA, Plaintiffs-Appellees, JOSEPH COOPER; NINA KASPRZAK, Appellants, and HARRIET SKURMAN; NORMAN HICKMAN; PHYLLIS HICKMAN; CRAIG ROSENFIELD, Intervenors, v. GENERAL ELECTRIC, INDIVIDUAL CONSUMER DISHWASHER LITIGATION, Defendant-Appellee, v. BECKWITH PLACE LIMITED PARTNERSHIP, Plaintiff-Intervenor, and SUSAN E. GLATTER KAMMAN, individually and on behalf of others similarly situated, Plaintiff-Intervenor-Appellant. In re: GENERAL ELECTRIC, INDIVIDUAL CONSUMER DISHWASHER LITIGATION, CHURCHILL VILLAGE, L.L.C., BARBARA DORSETT; AL DORSETT; SEYMOUR LAZAR; JOAN CHALMERS; JUDITH SAPORTA, Plaintiffs-Appellees, HARRIET SKURMAN; NORMAN HICKMAN; PHYLLIS HICKMAN; CRAIG ROSENFIELD, Intervenors-Appellants, v. GENERAL ELECTRIC COMPANY, a New York corporation, Defendant-Appellee. CHURCHILL VILLAGE, L.L.C., BARBARA DORSETT, and AL DORSETT individually and on behalf of the general public, Plaintiff, and JAMES HOYER NEWCOMER & SMILJANICH, P.A.; LEVIN TANNENBAUM WOLFF; CAULEY GELLER BOWMAN & COATES, LLP, Appellants, v. GENERAL ELECTRIC, a New York corporation, Defendant-Appellee. CHURCHILL VILLAGE, L.L.C., BARBARA DORSETT, and AL DORSETT individually and on behalf of the general public; BARBARA DORSETT; AL DORSETT; SEYMOUR LAZAR; JOAN CHALMERS; JUDITH SAPORTA, Plaintiffs, and JAMES HOYER NEWCOMER & SMILJANICH, P.A.; LEVIN TANNENBAUM WOLFF; CAULEY GELLER BOWMAN & COATES, LLP, Claimants-Appellees, v. GENERAL ELECTRIC, a New York corporation, Defendant-Appellant.

Subsequent History: US Supreme Court certiorari denied by Beckwith Place L.P. v. Gen. Elec. Co., 2004 U.S. LEXIS 5641 (U.S., Oct. 4, 2004)

Prior History:  [**1]  Appeal from the United States District Court for the Northern District of California. D.C. No. CV-99-05073-MHP. Marilyn H. Patel, District Judge, Presiding.

Churchill Village, L.L.C. v. GE, 169 F. Supp. 2d 1119, 2000 U.S. Dist. LEXIS 7505 (N.D. Cal., 2000)

Disposition: Affirmed.

CORE TERMS

settlement, district court, dishwashers, objectors, class member, consumers, proposed settlement, complaints, contends, merits, notice, pattern of racketeering activity, federal jurisdiction, federal question, enterprise, collusion, hearings, objected, switch, preliminary approval, attorney's fees, state court, nationwide, parties, courts

Civil Procedure, Special Proceedings, Class Actions, Compromise & Settlement, Preliminary Considerations, Justiciability, General Overview, Standing, Class Members, Named Members, Appeals, Appellate Jurisdiction, Antitrust & Trade Law, Private Actions, Racketeer Influenced & Corrupt Organizations, Criminal Law & Procedure, Racketeering, Racketeer Influenced & Corrupt Organizations Act, Elements, Defenses, Demurrers & Objections, Motions to Dismiss, Failure to State Claim, Jurisdiction, Subject Matter Jurisdiction, Federal Questions, Judicial Discretion, Prerequisites for Class Action, Settlements, Settlement Agreements, Standards of Review, Remedies, Costs & Attorney Fees, Constitutional Law, Case or Controversy, De Novo Review, Civil Rights Law, Procedural Matters, Statutory Attorney Fee Awards