Biederman v. FCA US LLC

Background

Plaintiffs purchased RAM 2500 and 3500 pickup trucks that allegedly contained devices affecting the diesel engines’ emissions and performance. They brought a proposed class action asserting 11 causes of action against FCA US LLC and Cummins Inc.

On February 11, 2025, the court granted in part and denied in part the defendants’ motions to dismiss the consolidated amended complaint. As relevant here, it granted Cummins’ motion under Federal Rule of Civil Procedure 12(b)(6), which concerns whether a complaint adequately states a legal claim, and dismissed the plaintiffs’ civil claim under the Racketeer Influenced and Corrupt Organizations Act, or RICO, without leave to amend.

The earlier dismissal relied on the rule from Illinois Brick Co. v. Illinois that indirect purchasers cannot bring certain claims under the Clayton Act. The court concluded that the civil RICO enforcement provision, 18 U.S.C. § 1964(c), is sufficiently similar to the Clayton Act provision that the same indirect-purchaser rule applies. Because the plaintiffs bought their vehicles from third-party dealerships rather than from the defendants, the civil RICO claim could not proceed.

Motion for Reconsideration

Plaintiffs argued that the Supreme Court’s decision in Medical Marijuana, Inc. v. Horn undermined the February 11 ruling. In Horn, the Supreme Court held that the civil RICO statute permits recovery for business and property losses derived from a personal injury. The Supreme Court also stated that the Clayton Act and the civil RICO provision are not interchangeable.

The court rejected plaintiffs’ interpretation of Horn. It explained that Horn addressed whether antitrust principles barred recovery for business or property injuries derived from personal injury. This court’s decision involved a different question: whether the indirect-purchaser rule from Illinois Brick applies to civil RICO claims. The court also reasoned that the concerns underlying Illinois Brick, including duplicate recoveries and the difficulty of allocating damages, were not eliminated merely because Illinois Brick was decided after Congress enacted the civil RICO provision.

The court therefore denied plaintiffs’ motion for reconsideration.

Certification for Interlocutory Appeal

Plaintiffs also sought certification under 28 U.S.C. § 1292(b) for an interlocutory appeal. An interlocutory appeal is appellate review before the district court enters a final judgment. Certification requires three findings: a controlling question of law, substantial ground for disagreement about that question, and a determination that immediate review may materially advance the litigation.

The court found all three requirements satisfied. First, it found that whether Illinois Brick applies to 18 U.S.C. § 1964(c) is a controlling legal question because the civil RICO claim was the only claim supporting a nationwide proposed class. Reinstating that claim could potentially expand the case from a one-state class to a fifty-state class and could make treble damages available.

Second, the court found substantial ground for a difference of opinion. Although the federal circuit courts that had considered the issue had applied Illinois Brick to civil RICO claims, the court noted uncertainty in those decisions and disagreement among some district courts. It concluded that reasonable judges could reach different conclusions on the issue.

Third, the court found that an interlocutory appeal might materially advance the litigation. Early review could avoid additional class discovery and certification proceedings and could prevent the need for a separate trial if the civil RICO claim were later restored. The court did not decide the defendants’ alternative arguments that the plaintiffs had failed to plausibly allege a RICO enterprise.

Disposition

The court denied the motion for reconsideration and granted the motion to certify an interlocutory appeal under 28 U.S.C. § 1292(b). It also scheduled the next case-management conference for June 11, 2025, and stated that the order disposed of Docket Nos. 102 and 109.