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Hale v. Emerson Electric Co.

United States Court of Appeals, Eighth Circuit

November 1, 2019

Jeff Hale, on behalf of himself and all others similarly situated; Raymond Gray, on behalf of himself and all others similarly situated; Andrew Bowers; Emilio Gonzales; Kenneth Thompson, on behalf of themselves and all other similarly situated; Eric Shults; Justin Swires, individually and on behalf of all others similarly situated; Estaban Maravilla, individually and on behalf of all others; Lauren Checki; Kevin Brees; Chad Venhaus; Chris Willis; Fred Wilmer Plaintiffs - Appellees
v.
Emerson Electric Company Defendant-Appellant Sears Holdings Corporation; Sears, Roebuck and Company; The Home Depot, Inc. Defendants

          Submitted: April 17, 2019

          Appeal from United States District Court for the Eastern District of Missouri - St. Louis

          Before SMITH, Chief Judge, KELLY and KOBES, Circuit Judges.

          PER CURIAM.

         Emerson Electric Company appeals from an order certifying a nationwide class of plaintiffs in a case involving allegedly deceptive advertising practices. The district court ruled that all class members' claims would be governed by Missouri law and therefore determined class resolution was appropriate. We reverse and remand for further consideration.

         I.

         This suit arises out of allegedly deceptive advertising associated with RIDGID brand vacuums. Emerson, a Missouri corporation, manufactures, markets, and sells RIDGID vacuums. It makes all marketing decisions regarding the vacuums in Missouri. Emerson markets the vacuums by emphasizing their "peak horsepower"-the maximum potential output of the vacuums' motors. Emerson acknowledges that the vacuums can only achieve "peak horsepower" in a laboratory. A consumer using a standard wall outlet would achieve less horsepower than advertised.

         Plaintiffs allege advertising based on peak horsepower is misleading and bring claims for violations of the Missouri Merchandising Practices Act (MMPA), Mo. Rev. Stat.§ 407.010, et seq., breach of express warranty, breach of implied warranty, unjust enrichment, violations of other states' consumer protection laws, and redhibition (on behalf of a Louisiana sub-class).

         The Judicial Panel on Multidistrict Litigation assigned this case to the district court as a consolidated action and the district court oversaw discovery. At the close of discovery, Plaintiffs sought to certify a nationwide class. The district court applied Missouri choice of law rules and determined that all claims should be governed by Missouri law. It then certified the class under Federal Rule of Civil Procedure 23(a) and 23(b)(3). We have jurisdiction over Emerson's interlocutory appeal. 28 U.S.C. § 1292; Fed.R.Civ.P. 23(f).

         II.

         We review a district court's grant of class certification for abuse of discretion but review rulings on issues of law de novo. In re St. Jude Medical, Inc., 425 F.3d 1116, 1119 (8th Cir. 2005). To certify a class, a district court must find that the plaintiffs satisfy all the requirements of Rule 23(a) and one of the subsections of Rule 23(b). Id. (citing Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 614 (1997)). The district court certified the class based on Rule 23(b)(3), which requires finding that "questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3). "[V]ariations in state law may swamp any common issues" and defeat class certification under Rule 23(b)(3). See Castano v. Am. Tobacco Co., 84 F.3d 734, 741 (5th Cir. 1996).

         Emerson argues that the district court erred twice. First, the claims of non-Missouri residents do not relate to "trade or commerce . . . in or from the state of Missouri" and the MMPA cannot be applied to them. Second, the district court should have conducted separate choice of law analyses for the breach of warranty and unjust enrichment claims. We agree.[1]

          The MMPA provides a private right of action for "any deception, fraud, false pretense, false promise, misrepresentation, [or] unfair practice . . . in connection with the sale or advertisement of any merchandise in trade or commerce . . . in or from the state of Missouri." Mo. Stat. §§ 407.020.1; 407.025.1. Where a party seeks to certify a nationwide class under the MMPA, we can resolve the case based on that statute's scope. See Perras v. H & R Block, 789 F.3d 914, 917 (8th Cir. 2015).

         We have explained that although the MMPA covers every kind of unfair practice, a plaintiff's claim nevertheless must involve commerce "in or from the state of Missouri." See Perras, 789 F.3d at 917-18; Ports Petroleum Co. of Ohio v. Nixon, 37 S.W.3d 237, 240 (Mo. banc 2001); State ex rel. Nixon v. Estes, 108 S.W.3d 795, 801 (Mo.Ct.App. 2003). In Perras we held that a putative class action against H & R Block for an allegedly fraudulent "compliance fee"-designed and ...


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