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Reif and Horst Handily Defeat Dual Class Action Claims against Foreign Parts Manufacturer and U.S. Automakers

April 12, 2021`
Frederick Reif (Partner-New York, NY) and Nathan Horst (Of Counsel-New York, NY) obtained dismissal of automotive class action claims brought against a German automotive component manufacturer and its U.S. subsidiary, makers of similar “crash active headrests.” The plaintiffs, in separate suits, brought class action claims against the manufacturer and its subsidiary alleging design defects that caused the head restraints to spontaneously deploy. Vehicle manufacturers that installed the headrests also were named defendants. In these actions, the respective plaintiffs asserted claims sounding in fraudulent concealment, unjust enrichment, implied warranty, and violation of various states trade practices acts on behalf of national classes and state subclasses.

“The parts manufacturers each moved for dismissal for lack of personal jurisdiction, and the case against the subsidiary was voluntarily dismissed; however, plaintiffs in the second case were more tenacious, having amended their Complaint to assert a RICO claim and arguing that jurisdiction was permissible under the “national long-arm statute,” Fed. R. Civ. P. 4(k)(1)(c). Fred and Nathan emphasized the facts adduced during jurisdictional discovery which demonstrated that jurisdiction was impermissible under constitutional due process analysis, and further argued with co-defendant counsel that the RICO claim was patently defective, and had been added merely to provide a jurisdictional anchor otherwise lacking. In a comprehensive, well-reason decision, the court agreed, and determined (1) that plaintiffs had conceded that manufacturer was not subject to the court’s jurisdiction based on Florida contacts alone; (2) that the RICO claim was fatally defective; and (3) given dismissal of the defective federal claim, Rule 4(k)(1)(C) did not apply and pendent jurisdiction did not exist.

Fred and Nathan were assisted in these matters by Tony Strasius (Partner-Miami, FL) and Steven Jones (Associate-Miami, FL).

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