Brooks v. GAF Materials Corp.

Citations: 41 F. Supp. 3d 474; 2014 WL 3349906; 2014 U.S. Dist. LEXIS 93055Docket: Civil Action No. 8:11-cv-00983-JMC

Court: District Court, D. South Carolina; July 9, 2014; Federal District Court

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In a class action lawsuit, Named Plaintiffs Jack and Ellen Brooks allege that Defendant GAF Materials Corporation manufactured defective Timberline® roofing shingles. The court is considering GAF's motion for summary judgment regarding claims of negligence, negligent misrepresentation, breach of express and implied warranties, fraud, unjust enrichment, and violations of the South Carolina Unfair Trade Practices Act (SCUTPA). GAF provides a limited warranty for its shingles, which was in effect when the Named Plaintiffs installed the shingles in 2000. They discovered cracking in the shingles in 2003 and subsequently filed warranty claims through their contractor, which were unsuccessful, leading to the lawsuit in April 2006. The court previously certified a class of individuals owning South Carolina properties with GAF Timberline® shingles manufactured between 1999 and 2007 that exhibited cracking, excluding properties owned by GAF or its affiliates. GAF filed the summary judgment motion on May 20, 2014, with the Plaintiffs opposing it and GAF replying later that month. The court ultimately grants in part and denies in part GAF's motion.

Summary judgment is appropriate when the moving party establishes there is no genuine dispute regarding any material fact, thus entitling them to judgment as a matter of law, per Federal Rule of Civil Procedure 56(a). A material fact influences the case's outcome under relevant law, and a genuine dispute exists if a reasonable jury could favor the non-moving party based on the evidence reviewed. Courts must view evidence favorably for the non-moving party, who cannot simply rely on allegations but must provide specific facts to show a genuine issue for trial. Unsupported speculation is insufficient to counter a summary judgment motion.

In the context of plaintiffs' warranty claims against GAF, the company contends it is entitled to summary judgment based on a limited warranty that explicitly disclaims all other warranties under South Carolina law. GAF argues that this warranty was integral to the purchase of its Timberline® shingles, binding the plaintiffs as third-party beneficiaries. GAF claims there is no evidence of additional warranties or representations about the shingles' lifespan and asserts that the absence of such a representation negates any cause of action for the product not meeting the purchaser's expectations. Furthermore, GAF maintains that even if another warranty existed, it fulfilled its obligations by attempting to repair or replace the defective shingles.

Plaintiffs contest GAF's Rule 56 motion, arguing they are not bound by GAF's limited warranty since it was not agreed upon before the sale and any limitations were only discovered post-installation. They cite legal precedent indicating that a disclaimer provided after a sale is ineffective if a contract already exists. Plaintiffs claim GAF's designation of Timberline® 30 shingles implies a 30-year lifespan, which they argue GAF breached due to issues like premature cracking and tearing, damaging Plaintiffs and class members. They support their claims with employee testimonies affirming the 30-year expectation. Additionally, Plaintiffs assert that South Carolina law prohibits GAF from negating an express warranty with a limitation, especially since GAF was aware of product defects when attempting to limit the warranty. They contend that imposing such limitations would be unconscionable given the disparity in bargaining power when the buyer is unaware of defects. Under South Carolina law, an express warranty can be created through affirmations or descriptions of goods that form part of the bargain, and such warranties cannot be disclaimed. To prove a breach of express warranty, a plaintiff must show the existence of the warranty, the breach, and resultant damages. The court finds sufficient evidence to create a genuine issue of material fact regarding whether GAF established an express warranty concerning the Timberline® 30 shingles' expected duration.

GAF has not demonstrated that it is exempt from liability as the manufacturer and seller of Timberline® 30 shingles based on their failure to meet longevity representations, leading to the denial of GAF's motion for summary judgment regarding the Plaintiffs' breach of express warranty claim. However, this denial does not extend to the express warranty claims of the Named Plaintiffs. GAF successfully argued for summary judgment on the Named Plaintiffs' claim, supported by an affidavit from Ted Marcopolus, indicating that the shingles installed on their home were not Timberline® 30 shingles, as GAF only began selling them in January 2002. GAF's evidence, which included marketing materials from 1999 to 2002, went unchallenged by the Named Plaintiffs. While GAF is entitled to summary judgment on the Named Plaintiffs' claim, the court does not extend this to the entire class claim, recognizing the possibility of substituting a new class representative when a named plaintiff's claim fails. The court affirms that the dismissal of the Named Plaintiffs' claims does not necessitate the dismissal of the class action itself, allowing for the continuation of the class claims with an appropriate substitute representative. The court encourages Plaintiffs' counsel to move for the substitution of a suitable class representative promptly to proceed with the breach of express warranty claim.

The South Carolina Commercial Code provides for two implied warranties: merchantability and fitness for a particular purpose. To prove a breach of the implied warranty of merchantability, a plaintiff must demonstrate that a merchant sold goods that were unmerchantable, that the plaintiff suffered injury due to these goods, that the defect caused the injury, and that the plaintiff provided timely notice to the seller. An implied warranty of fitness arises when the vendor knows that the purchaser relies on their expertise in providing the goods. If the intended purpose of a product aligns with its ordinary use, both warranties can be pursued cumulatively.

Sellers in South Carolina may disclaim these implied warranties, but specific language must be used, and such disclaimers must be conspicuous in writing. Ambiguities in the contract will be interpreted against the seller. In a recent case, the court found a genuine dispute regarding whether Mays was a representative of GAF or an independent purchaser. Ultimately, the court determined that Mays was an independent contractor, leading to the conclusion that Plaintiffs are bound by GAF's limited warranty disclaimer. However, because there are unresolved factual issues regarding the effectiveness of GAF's limited warranty and whether the limitation of damages is unconscionable, the court denied GAF's motion for summary judgment on the breach of limited warranties claim. The trial court was found to have erred in granting summary judgment for Brunswick and Tracker on Weldon's warranty claims due to similar factual disputes.

GAF seeks summary judgment on the plaintiffs' negligence claim, arguing it did not breach any duty or exercise inadequate care, asserting that cracked shingles alone do not signify negligence and that there is insufficient evidence to prove it knowingly sold defective products. The plaintiffs contend GAF was negligent in multiple ways, including improper design and manufacturing of Timberline® shingles, inadequate testing, continuing sales despite awareness of defects, and failing to recall defective shingles, resulting in damages from purchasing these defective products.

To establish a negligence claim in South Carolina, the plaintiffs must demonstrate that GAF owed a duty of care, breached that duty through negligent acts or omissions, that such breach was the proximate cause of their injuries, and that they suffered damages. The legal standard for duty of care is determined by the court, while breach of duty is a factual question. Negligence must be the proximate cause of the injury, with liability arising from consequences that are natural and probable outcomes of the negligence. Proximate cause is typically a jury question and can be proven through either direct or circumstantial evidence.

Manufacturers in South Carolina must exercise reasonable care during the manufacturing process to ensure products are free from dangerous defects. In the case of Jackson v. Bermuda Sands, Inc., the court found that Plaintiffs presented sufficient evidence to create genuine issues of material fact regarding damages from Timberline® shingles and GAF's knowledge of defects leading to premature cracking. Consequently, the court is inclined to deny GAF's summary judgment motion concerning the negligence claim, as proximate cause and breach of duty are factual questions.

Regarding the unjust enrichment claim, GAF contends it is entitled to summary judgment because contractual remedies are available through its limited warranty. Plaintiffs argue that they should be allowed to pursue unjust enrichment as an alternative theory if the jury finds no remedy under other claims. They assert that it is unjust for GAF to retain payment for a product that did not meet its promised value. Under South Carolina law, unjust enrichment requires proving that the defendant received a benefit, realized it, and retained it unjustly. Plaintiffs can plead alternative claims and are not required to elect remedies until after the verdict. The court, therefore, denies GAF's motion for summary judgment regarding the unjust enrichment claim.

GAF seeks summary judgment on claims of negligent misrepresentation and fraud, arguing it made no representations about the longevity of Timberline® shingles that the Named Plaintiffs relied upon. GAF contends that the evidence fails to demonstrate a false representation or justifiable reliance by the Named Plaintiffs. In opposition, the Named Plaintiffs assert that GAF claimed Timberline® shingles would last thirty years and that they relied on this assertion when selecting the shingles for their homes, emphasizing GAF's pecuniary interest in marketing them as such. The court outlines the elements required to prove negligent misrepresentation, noting that the Named Plaintiffs only allege the shingles were falsely represented as 30-year shingles. GAF counters that the Named Plaintiffs could not have purchased these shingles in 2000, as GAF began marketing them in 2002, and that the Named Plaintiffs did not communicate directly with GAF about the shingles' duration. Consequently, the court finds the Named Plaintiffs lack sufficient facts for a jury to conclude that GAF made a false representation, granting GAF's motion for summary judgment on the negligent misrepresentation claim. Additionally, the Named Plaintiffs have requested to withdraw their fraud claim against GAF, which GAF does not oppose, leading the court to grant this request as well.

GAF argues that the Named Plaintiffs' SCUTPA claim should not survive summary judgment, asserting insufficient evidence of deceptive marketing related to Timberline® shingles. In response, the Named Plaintiffs contend that for a SCUTPA violation, a statement must merely be capable of misleading and repeated. They specifically claim GAF misrepresented Timberline® shingles as 30-year shingles, despite their actual lifespan and warranty duration being less. SCUTPA prohibits unfair competition and deceptive practices, requiring plaintiffs to prove an unlawful trade practice, actual damages, and adverse public impact. The Named Plaintiffs allege GAF's false representation regarding the shingles' lifespan as the basis for their claim. However, the court finds that GAF is entitled to summary judgment because the Named Plaintiffs neither purchased the Timberline® 30 shingles nor received direct communications from GAF regarding the shingles they did buy. Consequently, GAF's motion for summary judgment is granted concerning the SCUTPA claim. The court's ruling also grants GAF summary judgment on the express warranty claim and the individual claims of Jack Brooks and Ellen Brooks for negligent misrepresentation and SCUTPA violations, while denying GAF's motion on class claims for negligence, breach of express and implied warranties, and unjust enrichment. Jack Brooks and Ellen Brooks have withdrawn their fraud claim, and the case will proceed to trial on the remaining class claims.

GAF claims that the shingles on the Named Plaintiffs' roof were covered by a 30-year limited warranty, which promised to provide new shingles and cover the full reasonable labor costs for repairing defects within the first five years. After this period, GAF would contribute to the cost of replacement shingles based on the remaining warranty duration but would not cover installation labor. The court previously outlined the procedural history of the case in its May 31, 2012 order. Michael Ferraro, GAF’s Vice President of Engineering Services, confirmed that Timberline® 30 shingles are warranted for 30 years, and customers expect them to last that long. 

Although the Plaintiffs did not explicitly plead a breach of express warranty based on compliance with the ASTM D3462 industry standard, they attempted to argue this through expert testimony. However, the court determined that such an argument would not withstand summary judgment, even when considering the evidence in favor of the Plaintiffs. The court also noted that the Named Plaintiffs failed to seek permission to address new information in GAF's affidavit. As a result, GAF was granted summary judgment against express warranty claims from any Plaintiffs who purchased Timberline® shingles without a numerical designation. 

Under South Carolina law, a merchant implicitly warrants that goods are merchantable, which requires them to be fit for their ordinary purposes. Additionally, an implied warranty of fitness for a particular purpose arises if the seller is aware of the buyer's specific needs and the buyer relies on the seller's expertise to provide suitable goods.