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Mednick v. Precor, Inc.

United States District Court, N.D. Illinois, Eastern Division

June 16, 2017

GARY MEDNICK and STEVEN BAYER, Individually and on Behalf of All Others Similarly Situated, Plaintiffs,
v.
PRECOR, INC., a Delaware Corporation, Defendant.

          MEMORANDUM OPINION AND ORDER

          Harry D. Leinenweber, Judge United States District Court

         Because the Court finds no manifest error of law in its Order granting class certification, it denies Defendant Precor, Inc.'s (“Precor”) Motion for Reconsideration [ECF No. 174].

         I. BACKGROUND

         In March 2017, the Court certified as a class Plaintiffs' consumer fraud action. Mednick v. Precor, Inc., No. 14 C 3624, 2017 U.S. Dist. LEXIS 37694, at *1 (N.D. Ill. Mar. 16, 2017). The certification was limited since the Court allowed the case proceed as a class only for the purpose of determining liability and reserved issues related to damages to individual hearings. Id. The ruling nonetheless moved the case forward as it permits Plaintiffs to attempt to prove the merits of their allegation that Precor had deceptively marketed and sold treadmills incorporating “touch sensors, ” a heart rate monitoring technology, that Precor knew did not accurately measure its users' heart rates.

         The victory was hard won for Plaintiffs. To obtain it, they had significantly narrowed the proposed class. In their original Motion for Class Certification, Plaintiffs had sought to certify both a nationwide class to pursue a federal warranty claim and a multi-state class to recover under the consumer protection laws of 10 different states. Plaintiffs defined as class members all those who bought Precor's exercise equipment containing the touch sensor technology, or 20 models of treadmills, elliptical machines, and stationary bikes in all.

         The Court refused to certify such a broad class. Mednick v. Precor, Inc., No. 14 C 3624, 2016 U.S. Dist. LEXIS 75582, at *1 (N.D. Ill. June 10, 2016). It found that Plaintiffs had not carried their burden to show that Rule 23(b)(3)'s predominance requirement was satisfied. See, Id. at *17-23. The Court acknowledged that whether Precor “falsely and misleadingly market[ed] the Touch Sensors . . . on the 20 Precor machines at issue despite knowing that they were ‘inherently defective'” was a common issue susceptible to class treatment. Id. at *17-18. Nonetheless, it concluded that “[t]he nature of Plaintiffs' claims . . . prevents the Court from finding Rule 23(b)(3) satisfied.” Id. at *23. The Court was concerned that Plaintiffs' “breach-of-warranty action, coupled with a claim of fraud, poses serious problems about choice of law, the manageability of the suit, and thus the propriety of class certification.” Id. (quoting Szabo v. Bridgeport Machines, Inc., 249 F.3d 672, 674 (7th Cir. 2001)) (internal quotation marks omitted). In addition, the Court found that the following questions, heavily relied upon by Precor in its Motion for Reconsideration, predominated over the issue common to the class:

         (1) [I]s th[e] unreliability [of the touch sensors, if any] attributable to a defect, or simply to human error?

         (2)Or is the unreliability due to some external factor, like the user's age? Or their body mass? Or weight? Or their cardio-physiology? Or the thickness or dryness of the skin on their hands? Or their average rate of exercise?

         (3) And if the product proves to be defective, is that defect present only on a certain type of machine (treadmill, elliptical, AMT, or stationary bike)?

         (4)Or is it attributable to a specific heart rate system (Alatech, Salutron, or Polar)?

         Mednick, 2016 U.S. Dist. LEXIS 75582 at *21-22.

         Having failed to obtain class certification on their first try, Plaintiffs acted to narrow the scope of their case. They entirely dropped the warranty claim, reduced the number of states for which they pursue the consumer fraud claims from ten to five, and cabined the products they allege to be deceptively marketed to just the treadmills. (Plaintiffs also abandoned their effort to certify a class under Rule 23(b)(2) and no longer seek injunctive relief. Because these issues did not figure into the Court's decision to certify the class, the Court does not discuss them any further in this Opinion.) Thus, on the renewed Motion for Class Certification, Plaintiffs' proposed class went from being nationwide to covering just five states. The proposed class products decreased from 20 models of treadmills, ellipticals, and stationary bikes to nine models of treadmills. Moreover, with the warranty claim gone, Plaintiff's case no longer presented a problematic “breach-of-warranty action, coupled with a claim of fraud.” Szabo, 249 F.3d at 674. Instead, it became a pure consumer fraud action, and Plaintiffs worked to show that the laws of the remaining five states were largely uniform.

         The Court found that this narrow class satisfied the requirements of Rule 23. It identified as a question common to the class the issue of whether Precor engaged in representations or omissions that were likely to deceive a reasonable consumer. See, Mednick, 2017 U.S. Dist. LEXIS 37694, at *21-22. The Court further found that this common question “predominate[d] over any questions affecting only individual members.” See, Id. at *44-52; Fed.R.Civ.P. 23(b)(3). In arriving at this conclusion, the Court specifically addressed whether Plaintiffs' injuries could be proximately caused by Precor's allegedly deceptive promotional materials. See, Id. at *22-33. The Court concluded that when the representations were confined to those graphics found on the machines themselves and any omissions Precor failed to make to the class, Plaintiffs could carry their burden to show proximate causation with classwide proof. See, Id. at *31-33. The Court expressly noted that it found the case at bar “analogous” to Suchanek v. Sturm Foods, Inc., 764 F.3d 750 (7th Cir. 2014). Id. at *32.

         The Court also examined the issue of damages. It decided that the class members' damages should be reserved to individual hearings. See, Mednick, 2017 U.S. Dist. LEXIS 37694, at *36-38. Nonetheless, mindful of what the Supreme Court said in Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2013), the Court scrutinized Plaintiffs' damages model. See, Id. at *44-48. Although the Court understood that the model that Plaintiffs submitted calculated a full refund as a measure of the class members' damages, the Court reasoned that this model could readily be modified to deliver a partial refund number instead. See, Id. The Court thus found that Comcast did not prevent the class from being certified. Accordingly, the Court granted Plaintiffs' motion to certify the class for the purpose of determining liability.

         Precor asks the Court to reconsider, asserting that the Court made multiple manifest errors of law. The Court finds no such error upon reexamining its opinion and so denies the Motion.

         II. LEGAL STANDARD

         While Precor styled the current matter a Motion for Reconsideration, no such motion exists under the Federal Rules of Civil Procedure. Talano v. Nw. Med. Faculty Found., 273 F.3d 757, 760 n.1 (7th Cir. 2001). Instead, the Court must construe Precor's request for relief either as a motion to alter or amend a judgment under Rule 59(e) or a motion for relief from a final order under Rule 60(b). Because Precor filed the Motion within 28 days of the Court's class certification order and because it argues that the Court made manifest errors of law rather than that any new evidence has been discovered, the Court deems Precor to be moving under Rule 59(e). See, Fed. R. Civ. P. 59(e) (requiring that a motion to alter or amend a judgment “be filed no later than 28 days after the entry of the judgment”); Scott v. Bender, 948 F.Supp.2d 859, 866 (N.D. Ill. 2013) (stating that an argument that a court committed errors of law is “the province of Rule 59(e) and not Rule 60(b)”) (emphasis in original).

         Precor bears a heavy burden in seeking to reverse the Court's prior ruling. See, Scott, 948 F.Supp.2d at 866 (citing Caisse Nationale de Credit Agricole v. CBI Indus., Inc.,90 F.3d 1264, 1270 (7th Cir. 1996)). Precor can show that the Court committed a manifest error of law only by establishing that the Court engaged in “wholesale disregard, misapplication, or failure to recognize controlling precedent.” Oto v. Metro. Life Ins. Co.,224 F.3d 601, 606 (7th Cir. 2000) (internal quotation marks omitted). In attempting to carry its burden, Precor cannot advance arguments or theories that the Court has previously rejected or those that “could and should have been made before the district court rendered a judgment.” Sigsworth v. City of Aurora, 487 F.3d 506, 512 (7th Cir. 2007) (internal quotation marks omitted); Schilke v. Wachovia Mortg., FSB, 758 F.Supp.2d 549, 554 ...


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