8th Circuit panel affirms ruling in favor of Polaris in class action suit

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Medina-based Polaris Inc. has prevailed in a class-action lawsuit claiming that a design flaw in its off-road vehicles shortens the vehicles’ lives and endangers owners.

The difference between the potential for injury and actual injury incurred turned the tide in the company’s favor with a panel of the 8th U.S. Circuit Court of Appeals.

A group of 14 people who had bought Polaris outdoor vehicles claimed that a design defect caused the vehicles, all of which contain Polaris’ ProStar engines, to produce an unusual and dangerous amount of heat. They also claimed that the heat degrades vehicle parts, reduces service life and creates a risk of fires. Seven of the purchasers alleged that their vehicles caught fire and were destroyed.

The purchasers pointed to the availability of aftermarket products meant to dissipate or protect against heat in the Polaris vehicles, and to alternative exhaust designs in competing vehicles. They also said Polaris recalled all the class’s vehicles at one time or another.

Two of the purchasers whose Polaris vehicles didn’t catch fire alleged that they could “feel … excessive heat come through” the passenger compartments, but none claimed that microscopic thermal degradation was present in any of their vehicles. They did say, though that they had suffered economic damages because they “would have not purchased the vehicles at all or would have paid significantly less” if they had known of the alleged defect.

“Polaris has exhibited a pattern and practice of putting profits above consumer safety,” then stated Adam Levitt of Chicago-based DiCello Levitt Gutzler, a team of lawyers which represented the plaintiffs. “With this lawsuit we are aiming to ensure, once and for all, that the company gets its priorities straight and provides class members the justice they deserve.”

While the purchasers said that vehicle owners “are unable to operate their Class Vehicles without putting themselves at risk of injury and property damage,” none of them stopped using their vehicle despite the alleged defect.

The purchasers sought to certify classes of vehicle owners. They raised various state law claims, including breach of warranty, fraudulent omission and violations of consumer fraud laws, under the law of the states in which they purchased their vehicles. Polaris, represented by Kirkland & Ellis of Chicago, moved to dismiss the complaint of the two purchasers whose vehicles didn’t catch fire, saying they failed to allege an injury in fact that would establish Article III standing to sue.

Article III standing requires a plaintiff to establish that he has “suffered an ‘injury in fact’—an invasion of a legally protected interest” that is both “concrete and particularized” and “actual or imminent, not conjectural or hypothetical.”

The U.S. District Court dismissed those two claims. Judge Wilhelmina M. Wright wrote that since overheating is common in off-road vehicles, the “no-fire” plaintiffs did not establish that they had suffered any damages due to the defect. The remaining plaintiffs then voluntarily dropped their claims.

In their appeal, the “no-fire” plaintiffs allowed that they would not have purchased the Polaris vehicles — or at least would have paid much less — had they been aware of the alleged heat defect. They argued that their allegations are comparable to those of the so-called “dry plaintiffs” who had standing in another 8th Circuit case, In re Zurn Pex Plumbing Products Liability Litigation.

Those plaintiffs were homeowners who installed plumbing systems that allegedly were “doomed to leak within warranty” because of “stress corrosion cracking” that began at the time of installation. Although the pipes had not yet leaked, this court concluded that the plaintiffs had standing because they alleged, with the support of expert testimony, that the cracking was “already manifest in all systems.”

But unlike the homeowners in Zurn Pex, said the three-judge panel of the circuit court, the purchasers did not allege that any manifest defect is present in their vehicles. They alleged that excessive heat can cause microscopic degradation in plastic and metal — but not that their own vehicles exhibit any manifest-but-invisible degradation. While they said they could feel excessive heat when operating their vehicles, they didn’t allege how the production of heat by itself results in an injury.

“The Polaris vehicles have not exhibited the alleged defect — the accelerated degradation of parts caused by allegedly excessive heat,” wrote circuit court judge Steven M. Colloton in his opinion. “The district court correctly applied our precedent in determining that the no-fire purchasers failed to allege an injury sufficient to confer standing.”