rejecting defendant’s argument that the plaintiff “cannot do indirectly what he cannot do directly by couching his private efforts to enforce the provisions of the Safety Act as state law misrepresentation claims” because the claims were authorized under state law and thus the plaintiff “has no need for, and thus need not invoke, a private right of action under the Safety Act”
How later courts described this case
- rejecting defendant’s argument that the plaintiff “cannot do indirectly what he cannot do directly by couching his private efforts to enforce the provisions of the Safety Act as state law misrepresentation claims” because the claims were authorized under state law and thus the plaintiff “has no need for, and thus need not invoke, a private right of action under the Safety Act”
- holding that common law misrepresentation claims were not preempted because they did not conflict with a FMVSS
Written by the judges who cited it.
The opinion
RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
File Name: 10a0393p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
X
-
ROBERT FABIAN,
-
Plaintiff-Appellant,
-
-
No. 10-5009
v.
,
>
-
Defendant-Appellee. -
FULMER HELMETS, INC.,
-
N
Appeal from the United States District Court
for the Western District of Tennessee at Memphis.
No. 09-02305—S. Thomas Anderson, District Judge.
Argued: October 19, 2010
Decided and Filed: December 23, 2010
Before: MOORE, SUTTON and FRIEDMAN,* Circuit Judges.
_________________
COUNSEL
ARGUED: Michael J. Wall, BRANSTETTER, STRANCH & JENNINGS, PLLC,
Nashville, Tennessee, for Appellant. Oscar C. Carr, III, GLANKLER BROWN, PLLC,
Memphis, Tennessee, for Appellee. ON BRIEF: James G. Stranch, III, J. Gerard
Stranch, IV, Steven J. Simerlein, BRANSTETTER, STRANCH & JENNINGS, PLLC,
Nashville, Tennessee, for Appellant. Oscar C. Carr, III, GLANKLER BROWN, PLLC,
Memphis, Tennessee, for Appellee.
_________________
OPINION
_________________
SUTTON, Circuit Judge. Robert Fabian, a representative of a yet-to-be-certified
class, seeks recovery from a helmet manufacturer for misrepresenting the safety of its
*
Daniel M. Friedman, Senior Circuit Judge of the United States Court of Appeals for the Federal
Circuit, sitting by designation.
1
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 2
helmets. The district court granted the defendant’s motion to dismiss the suit, holding
that Fabian’s complaint fails to state a cognizable claim. Because Fabian’s factual
allegations, when construed in his favor, state a plausible claim for relief, we reverse.
I.
Tucked within the Department of Transportation is the National Highway Traffic
Safety Administration (NHTSA), which regulates the performance of motorcycle
helmets (among other vehicle products) under the National Traffic and Motor Vehicle
Safety Act of 1966. 49 U.S.C. § 30101 et seq. In accordance with the Safety Act,
NHTSA promulgated Standard No. 218, which spells out the testing procedures that
helmets sold in the United States must satisfy. 49 C.F.R. § 571.218. One of these
procedures is an “impact attenuation test,” which involves the dropping of a helmet from
a minimum height of six feet onto an anvil to measure the effect of the impact on the
helmet. Id. at S7.1. Another test applies force to a helmet’s chin strap to determine
whether the helmet will remain in place during a crash. See id. at S7.3.
Standard 218 relies on self-certification, which means that companies test and
certify their own helmets rather than having NHTSA do it for them. When helmets pass
the test, the companies place a “DOT” label on them. 49 C.F.R. § 571.218 at S5.6.1(e).
NHTSA enforces these requirements by randomly purchasing helmets, employing
independent companies to run compliance tests on them and publishing the results.
Headquartered in Memphis, Tennessee, Fulmer Helmets designs, manufactures
and distributes the AF-50 Trooper motorcycle helmet. The AF-50 helmet comes in at
least two sizes: small and large.
In 2000, NHTSA selected the large AF-50 helmet for testing. The helmet passed
each component of the test. In 2002, NHTSA selected the small AF-50 for testing and
it failed two components of the test. It failed the impact attenuation test (because the
helmet’s absorption of impact, measured in time, exceeded the regulatory requirement
of 2.0 milliseconds by 0.2 milliseconds), and it failed the labeling requirement (because
the “DOT” symbol appeared an eighth of an inch too high from the bottom of the
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 3
helmet). Fulmer Helmets did not issue a recall, take any action to inform purchasers or
retailers that it had failed the test, or fix or remove the DOT symbol.
On July 22, 2004, Fabian bought two large Fulmer AF-50 helmets. In 2007,
Fabian sold one of the helmets to a friend, who later died of severe brain trauma in a
motorcycle crash while wearing the helmet.
In April 2009, Fabian filed a complaint against Fulmer Helmets in Tennessee
state court, which was later removed to federal court on diversity grounds. The federal
complaint alleged (1) fraudulent misrepresentation, (2) negligent misrepresentation,
(3) breach of the implied warranty of merchantability and (4) unjust enrichment. Fabian
claimed he had “relied on Fulmer’s material misrepresentations that such helmets were
‘DOT approved,’” causing him to purchase an “unsafe,” “inferior-quality” helmet that
created a “heightened risk of serious physical injury or death.” R.5 ¶¶ 3, 4, 23. Fabian
sought class certification for all persons who had purchased the AF-50 since the failed
2002 test, while excluding “anyone seeking to recover for physical injuries suffered due
to the failure of the subject helmets.” R.5 ¶ 24. Fabian asked for damages in the form
of a refund and disgorgement of profits.
Fulmer Helmets filed a Rule 12(b)(6) motion to dismiss the case for these
reasons, among others: (1) Fabian failed to state a claim as a matter of law; (2) the
Safety Act preempted the lawsuit; and (3) Tennessee’s statute of limitations barred the
claims.
The district court granted Fulmer Helmets’ motion to dismiss. It held that Fabian
failed to state a claim because Fabian had purchased two large helmets, and only small
helmets failed the 2002 test. The court reasoned that Fabian had not purchased “helmets
similar in all respects to the helmets which allegedly failed the August 2002 testing
forming the basis for [Fabian’s] claims.” R.24 at 27. At the same time, however, the
court rejected one of Fulmer Helmets’ alternative arguments, holding that the Safety Act
did not expressly or impliedly preempt Fabian’s claims. It reasoned that the Act’s
savings clause carves state common law claims from the preemptive scope of the statute
and that the state law claims would not “present an obstacle to the federal objective of
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 4
‘self-certification.’” Id. at 24. Lastly, the court held that Tennessee’s statute of
limitations barred Fabian’s claims for breach of implied warranties.
Fabian appeals the failure-to-state-a-claim ruling but not the breach-of-implied-
warranties ruling. Fulmer Helmets challenges the preemption ruling.
II.
To survive a motion to dismiss, Fabian must plead “enough factual matter” that,
when taken as true, “state[s] a claim to relief that is plausible on its face.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 556, 570 (2007). Plausibility requires showing more
than the “sheer possibility” of relief but less than a “probab[le]” entitlement to relief.
Ashcroft v. Iqbal, __ U.S. __, 129 S. Ct. 1937, 1949 (2009).
In granting the motion to dismiss, the district court used the following chain of
reasoning: (1) NHTSA performed a safety test on a large AF-50 helmet in 2000, and the
helmet passed all components of the test; (2) NHTSA performed a safety test on a small
AF-50 helmet in 2002, and the helmet failed at least one component of the test; and
(3) because Fabian premises his claim on the purchase of large AF-50 helmets, his claim
is implausible on its face given that Fulmer Helmets passed a 2000 NHTSA test on a
large AF-50 helmet.
The problem with this chain of reasoning is that it turns on potential inferences,
not necessary ones. There are at least two legitimate ways to think about the
significance of the NHTSA tests, and they point in opposite directions when it comes to
the merits of this lawsuit. One is that the difference between the 2000 and 2002 test
results turns on differences between the performance of the small and large AF-50
helmets. If so, that would support the district court’s ruling that the disparity between
the size of the helmet bought and the size of the helmet tested is fatal to Fabian’s claims.
The other reasonable inference, however, is that helmets of the same model, even if
differently sized, perform the same. Two differently sized helmets, for example, may
be no more distinct as a matter of performance than two differently sized pairs of shoes
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 5
or two differently sized pairs of pants. If so, the failed 2002 test potentially exposed a
defect in all AF-50 helmets, no matter their size.
In the absence of further development of the facts, we have no basis for crediting
one set of reasonable inferences over the other. Because either assessment is plausible,
the Rules of Civil Procedure entitle Fabian to pursue his claim (at least with respect to
this theory) to the next stage—to summary judgment or, if appropriate, a trial after the
parties have engaged in any relevant discovery to support one or the other interpretation.
So long as we can “draw the reasonable inference that the defendant is liable for the
misconduct alleged,” Iqbal, 129 S. Ct. at 1949, a plaintiff’s claims must survive a motion
to dismiss. That inference is reasonable here because “common sense,” id. at 1950, tells
us that a mass-manufactured consumer product, whether it is shoes, pants or helmets,
may utilize the same design (and carry the same flaw) regardless of its size.
Fulmer Helmets stresses that Fabian’s large helmet has “passed all tests” and that
the 2002 test is irrelevant. Fulmer Helmets Br. 16. But that does not necessarily end the
inquiry. The company may have changed its design or manufacturing process for all
AF-50s between 2000 and 2002, giving rise to a defect in all of its helmets and negating
the relevance of the successful 2000 test result. Or the same test conducted on two
randomly selected helmets (otherwise exactly the same) might yield different outcomes
due to nothing more than natural statistical variances. The successful 2000 test thus may
reflect an aberration unrelated to helmet size, while the failed 2002 test may point to a
real flaw in all AF-50s. Because Fabian has “nudged his claims . . . across the line from
conceivable to plausible,” Iqbal, 129 S. Ct. at 1950–51, he deserves a shot at additional
factual development, which is what discovery is designed to give him.
III.
Fulmer Helmets seeks to affirm the judgment on alternative grounds, namely that
the Safety Act preempts Fabian’s lawsuit. We disagree.
Although Fulmer Helmets’ position is not a picture of clarity, the company seems
to raise the following multi-step argument. Step one: the Safety Act contains several
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 6
enforcement mechanisms, including recalls initiated by NHTSA or actions initiated by
the Attorney General to enjoin violations of the Safety Act and to collect civil penalties
for violations of the Act. Step two: the Safety Act contains no private enforcement
provision. Step three: Fabian cannot do indirectly what he cannot do directly by
couching his private efforts to enforce the provisions of the Safety Act as state law
misrepresentation claims and the like. Step four: Fabian’s claims therefore must be
dismissed either because they are unauthorized by the Act or are preempted by it.
We can make short work of one aspect of this argument. That the Safety Act
does not expressly create a private enforcement action does not by itself defeat Fabian’s
claims. He has filed each claim under Tennessee law, which authorizes private
enforcement actions for fraudulent and negligent misrepresentation. Fabian has no need
for, and thus need not invoke, a private right of action under the Safety Act.
The other aspect of Fulmer Helmets’ argument—its preemption claim—deserves
a longer response. The Safety Act contains a preemption provision, 49 U.S.C.
§ 30103(b)(1) (“When a [federal standard] is in effect . . . a State may prescribe or
continue in effect a standard . . . only if the standard is identical to the [federal]
standard.”), and a savings clause, id. § 30103(e) (“Compliance with a [federal standard]
does not exempt a person from liability at common law.”). The savings clause “excludes
common-law tort actions” from the express preemption clause, allowing “state tort law
to operate—for example, where federal law creates only a . . . minimum safety
standard.” Geier v. Am. Honda Motor Co., 529 U.S. 861, 868 (2000). At the same time,
however, the savings clause does not “foreclose or limit the operation of” implied
conflict preemption principles, id. at 869, namely the possibility that a state common law
action nonetheless would be preempted because it conflicts with, or “stand[s] as an
obstacle” to, id. at 886, the Safety Act or Standard 218.
All of this means two things: (1) the savings clause spares Fabian’s
misrepresentation claims from express preemption; and (2) to the extent preemption
exists, it is because these state law actions “stand as an obstacle” to Standard 218. We
see no such obstacle, however.
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 7
In passing the Safety Act, Congress sought to “reduce traffic accidents and deaths
and injuries resulting from traffic accidents” by authorizing the Secretary of
Transportation to “prescribe motor vehicle safety standards.” 49 U.S.C. §§ 30101,
30111. The Act defines a “safety standard” as a “minimum standard for . . . motor
vehicle equipment performance.” Id. § 30102. In 1972, NHTSA decided to address the
“dramatic increase in both motorcycle registrations and motorcyclist fatalities” in the
previous five years and its finding that “two-thirds to three-fourths of motorcycle
fatalities result from head injuries.” 37 Fed. Reg. 10,079, 10,079 (May 19, 1972). At
the time, helmet companies relied on industry-established quality standards, but the
agency found that “some helmets, contrary to their own certification labels, do not meet
the requirements of industry specifications, or otherwise exhibit unacceptable
characteristics.” Id.
NHTSA, as a result, promulgated Standard 218 with the hope of “reduc[ing]
deaths and injuries to motorcyclists and other motor vehicle users resulting from head
impacts” by establishing “minimum performance requirements for helmets.” 38 Fed.
Reg. 22,390, 22,391 (Aug. 20, 1973). Manufacturers must label their helmets with a
“DOT” sticker, which “constitut[es] the manufacturer’s certification that the helmet
conforms to the applicable Federal motor vehicle safety standards.” 49 C.F.R. § 571.218
at S5.6.1(e). The label represents to the public that the manufacturer has satisfied
Standard 218’s testing requirements. NHTSA enforces this self-certification regime
through “testing, inspection, investigation, or research,” 49 U.S.C. § 30118, and has the
authority to demand that the manufacturer remedy any defect, such as by issuing a recall,
see id. §§ 30118(b)(2)(B), 30120.
The upshot is that Standard 218 creates minimum performance standards that
helmet manufacturers must meet in order to place “DOT” labels on their helmets, all
subject to NHTSA oversight. Fabian’s claims do not conflict with this regulatory
regime. The premise of Fabian’s common law claims is not the creation of a new
standard, whether one below, at or above Standard 218. It is that Fulmer misrepresented
its helmets as “DOT approved” through its marketing materials, website and catalogues,
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 8
as well as by the placement of the “DOT” symbol on the helmets, even after knowing
that it failed the 2002 safety test. Liability, if it exists at all, would turn on what Fulmer
Helmets said about its products, not on whether its products meet a standard that
conflicts with Standard 218.
These claims thus do not “actually conflict” with the requirements of, or the
purposes of, the Safety Act or Standard 218. Geier, 529 U.S. at 869. They do not
change Standard 218’s technical requirements. They do not disturb Standard 218’s
labeling requirements. And they do not add a new requirement that interferes with what
Standard 218 already requires. All that the claims do is potentially impose liability
based on representations about whether the Department of Transportation has approved
the helmets, even after a failed government-sponsored test. Cf. Cipollone v. Liggett
Grp., Inc., 505 U.S. 504, 528–29 (1992) (plurality) (holding that a fraudulent
misrepresentation claim was not expressly preempted by the Federal Cigarette Labeling
and Advertising Act because it turned on a “general obligation”—the “duty not to
deceive”—and because “State-law prohibitions on false statements of material fact do
not create diverse, nonuniform, and confusing standards”); see also Altria Grp., Inc. v.
Good, 555 U.S. 70, 129 S. Ct. 538, 545–49 (2008).
This approach is consistent with Geier. There, the Supreme Court held that
Federal Motor Vehicle Safety Standard 208, which gave car manufacturers a “range of
choices” in installing passive restraint systems, impliedly preempted a tort suit that
created a duty for defendant-manufacturers to install air-bags (as opposed to other
restraint systems). 529 U.S. at 874–75. The Court was concerned that such a duty
“presented an obstacle to the variety and mix of devices that the federal regulation
sought.” Id. at 881. It thus reasoned that Standard 208 contemplated a policy objective
that “safety would best be promoted if manufacturers installed alternative protection
systems in their fleets rather than one particular system in every car,” id., and an air-bag
requirement conflicted with this objective. No analogous purpose exists with respect to
Standard 218, which seeks only to establish “minimum performance requirements for
helmets.” 38 Fed. Reg. at 22,391.
No. 10-5009 Fabian v. Fulmer Helmets, Inc. Page 9
IV.
For these reasons, we reverse and remand the case to the district court to consider
Fulmer’s other defenses in the first instance.