In re Nissan North America, Inc. Litigation

Background

The plaintiffs filed a proposed class action against Nissan North America, Inc. (NNA) and Nissan Motor Co., Ltd. (NML). The proposed classes included people who purchased, owned, leased, or previously purchased or leased 2015-or-newer Nissan or Infiniti vehicles equipped with Forward Emergency Braking or Automatic Emergency Braking.

The complaint alleged that the vehicles’ braking technology could deactivate or falsely engage, causing the brakes to activate when no vehicle or obstacle was ahead. The plaintiffs alleged that the defendants knew about the problem but did not disclose it when the vehicles were purchased or repaired. The complaint asserted fraudulent-omission, warranty, and state consumer-protection claims.

The ten named plaintiffs bought or leased their vehicles from dealers in their respective states or online. Robert Garneau was identified as the California plaintiff. The other plaintiffs were identified as residents of Florida, Massachusetts, Missouri, New York, Pennsylvania, and Texas. NNA was incorporated in California and had its principal place of business in Tennessee. NML was identified as a Japanese corporation headquartered in Yokohama, Japan.

Motion to Appoint Interim Counsel

Before the actions were consolidated, the plaintiffs moved to consolidate them and to appoint four law firms as interim class counsel under Federal Rule of Civil Procedure 23(g). That rule allows a court to appoint counsel for a proposed class before deciding whether to certify the class, when appointment is necessary to protect the class’s interests.

The court found no special circumstances requiring interim counsel. The two actions had already been consolidated, the plaintiffs had filed one consolidated complaint, and the firms had shown that they could cooperate. The court therefore terminated as moot the motion to consolidate and denied without prejudice the motion to appoint interim counsel.

Venue and Personal Jurisdiction

NNA moved to dismiss nine plaintiffs for improper venue under 28 U.S.C. § 1391(b). Alternatively, NNA sought to transfer the entire action to the Middle District of Tennessee under 28 U.S.C. § 1404(a). NML joined NNA’s motion.

The court concluded that venue was improper in the Northern District of California for the nine nonresident plaintiffs. It explained that venue may be proper where a defendant resides, where a substantial part of the events occurred, or, when necessary, in a district where a defendant is subject to personal jurisdiction.

For general personal jurisdiction, the court rejected the plaintiffs’ argument that NNA’s incorporation in California automatically made NNA subject to jurisdiction in every California federal district. The court found that NNA was registered in the Eastern District of California and had its principal place of business in Tennessee, so it was not subject to general jurisdiction in the Northern District of California under the venue statute.

The court also found that the plaintiffs had not shown specific personal jurisdiction over NNA for the nonresident plaintiffs’ claims. NNA submitted evidence that its research facility in Silicon Valley had not been involved in researching, developing, designing, or testing the braking technology at issue. The plaintiffs provided no evidence contradicting that statement. The court further found no evidence connecting California-based sales or marketing activity to the nonresident plaintiffs’ purchases, which occurred outside California.

The court held that venue did lie in the Northern District of California for Garneau’s claims because NNA conceded that it was subject to specific jurisdiction concerning his vehicle purchase in that district. But venue did not lie there for the claims of the other nine plaintiffs. The court also denied the request for jurisdictional discovery because the plaintiffs’ request rested on a general assertion that discovery might reveal additional contacts, without identifying specific facts supporting that connection.

Transfer to Tennessee

Rather than dismissing the nine plaintiffs for improper venue, the court considered whether transferring the entire action would serve the interests of justice. It found that the case could have been brought in the Middle District of Tennessee because that court would have subject-matter jurisdiction, NNA would be subject to personal jurisdiction there, and venue would be proper there based on NNA’s principal place of business.

The court then weighed convenience and fairness. It gave less weight to the plaintiffs’ choice of forum because the case was brought as a proposed class action and nine of the ten named plaintiffs had no connection to California. The court found that Tennessee would be more convenient for NNA, whose headquarters were there, and for many of the plaintiffs and potential nonparty witnesses. It also found that witnesses outside California might be beyond the Northern District of California’s subpoena power.

Electronic evidence made access to evidence a neutral factor. The feasibility of consolidation was also neutral because the actions had already been consolidated. Familiarity with applicable law was neutral or weighed slightly against transfer because the complaint included California law and the laws of the nonresident plaintiffs’ home states. The court found that Tennessee had a greater local interest and that litigation costs favored transfer because many plaintiffs and potential witnesses would be geographically closer to Tennessee.

Balancing the factors, the court found that the Northern District of California’s limited connection to the alleged events and the convenience of nonparty and other witnesses favored transfer. The court granted NNA’s motion to transfer and ordered the Clerk to transfer the case to the United States District Court for the Middle District of Tennessee and close the Northern District of California file. The court also terminated as moot the motion to consolidate and denied without prejudice the motion to appoint interim counsel.

Disposition

The court granted the motion to transfer. It terminated as moot the plaintiffs’ motion to consolidate and denied without prejudice the plaintiffs’ motion to appoint interim counsel. The order did not decide whether the plaintiffs’ underlying defect, warranty, or consumer-protection claims were legally sufficient.