Cleveland v. Whirlpool Corporation

Background

The plaintiffs brought putative class claims alleging that certain Whirlpool dishwashers had a defect in the diverter shaft seal in the sump assembly that could allow a leak to develop. Four related lawsuits were filed, including this Minnesota case and cases in Illinois, Pennsylvania, and California. The parties later filed a consolidated amended complaint in this case for settlement purposes.

Before the proposed settlement, Whirlpool had filed motions to dismiss in three of the related actions. In this case, the court had previously granted in part and denied in part Whirlpool’s motion to dismiss: it dismissed the plaintiffs’ breach-of-contract and unjust-enrichment claims without prejudice and allowed their warranty and Minnesota consumer-protection claims to continue. The opinion states that the parties then engaged in discovery, expert analysis, mediation, and negotiations.

Proposed Settlement

The proposed settlement class includes people in the United States and its territories who purchased a new qualifying dishwasher, acquired one as part of buying or remodeling a home, or received one as a qualifying gift. The proposed class excludes specified Whirlpool personnel and related entities, insurers and subrogees, people who acquired a used dishwasher, certain extended-warranty or service-contract providers, and people who timely opt out.

The settlement provides tiered benefits for qualifying paid repairs or replacements involving past or future diverter-seal leaks occurring within eight years after manufacture. Depending on the dishwasher’s age, benefits include reimbursement ranging from 30 percent to 100 percent of the stated average repair cost of $225, or rebates toward new KitchenAid, Whirlpool, or Maytag dishwashers. Whirlpool also agreed to pay reasonable notice and administration expenses separately from class-member benefits.

Class members would release claims arising from or relating to the alleged defect and the related dishwasher parts through the date of the order. The release would not cover personal-injury claims or claims for damage to property other than the dishwasher itself. The proposed settlement also contemplated a request for up to $1,500,000 for attorneys’ fees, costs, and class-representative service awards, plus requests for service awards of up to $2,500 for each named plaintiff. The court stated that those requests would be considered separately and that final settlement approval would not depend on awarding the full requested amounts.

Court’s Analysis

At the preliminary-approval stage, the court examined whether the proposed settlement appeared to fall within the range of possible final approval and whether the proposed class could likely be certified for settlement purposes. The court found, on a preliminary basis, that the settlement appeared fair, reasonable, and adequate. It cited the parties’ litigation, discovery, negotiations, lack of evidence of collusion, conservation of resources, and the benefits available to class members.

The court also found that the proposed settlement class met the requirements for class certification under Rules 23(a) and 23(b)(3) of the Federal Rules of Civil Procedure for settlement purposes only. It found the class sufficiently numerous, identified common questions about the alleged defect and Whirlpool’s conduct, found the named plaintiffs’ claims typical, and found that the named plaintiffs and proposed class counsel adequately represented the class. The court appointed Elisabeth Cleveland, Amy Larchuk, Christopher Redmon, Dhaval Shah, and Thomas McCormick as class representatives and Harper Segui and Rachel Soffin as class counsel.

The court approved the proposed notice plan, which included email notices, mailed postcard notices, a settlement website, a toll-free telephone line, and access to more detailed information and claim forms. Class members would have the opportunity to submit claims, request exclusion, or object. The order set the deadline for requesting exclusion or filing objections at 91 days after entry of the preliminary approval order and scheduled the final approval hearing for May 26, 2022, at 9:00 a.m.

Order

Judge Wilhelmina M. Wright granted the plaintiffs’ unopposed motion for preliminary approval of the class action settlement. The court certified the proposed settlement class for settlement purposes only, preliminarily approved the settlement, appointed the class representatives and class counsel, ordered Whirlpool to provide class-member information to the settlement administrator, and approved the notice plan.

This was preliminary approval, not final approval. The order set procedures for notice, claims, objections, exclusions, fee requests, and the later final approval hearing.