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Steve W. Berman (Pro Hac Vice) Thomas E. Loeser (SBN 202724) HAGENS BERMAN SOBOL SHAPIRO LLP 1301 Second Avenue, Suite 2000 Seattle, WA 98101 Telephone: (206) 623-7292 Facsimile: (206) 623-0594 [email protected] [email protected]

Richard N. Sox (Pro Hac Vice) BASS SOX MERCER 2822 Remington Green Circle Tallahassee, FL 32308 Telephone: (850) 878-6404 Facsimile: (850) 942-4869 [email protected]

Counsel for Plaintiffs and the Franchise Dealer Class

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

IN RE: VOLKSWAGEN ‘CLEAN DIESEL’ MARKETING, SALES PRACTICES, AND PRODUCTS LIABILITY LITIGATION

This document relates to:

Napleton Orlando Imports, LLC, et al. v. Volkswagen Group of America, Inc., et al., Case No. 3:16-cv-02086-CRB

No. 02672-CRB (JSC)

PLAINTIFFS’ NOTICE OF MOTION, MOTION FOR CLASS CERTIFICATION, AND SUPPORTING MEMORANDUM

Date: November 1, 2019 Time: 10:00 a.m. Courtroom: 6, 17th Floor Hon. Charles R. Breyer

[REDACTED VERSION OF DOCUMENT SOUGHT TO BE SEALED]

Case 3:15-md-02672-CRB Document 6387 Filed 06/14/19 Page 1 of 53

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MOTION FOR CLASS CERTIFICATION - i Case No.: 02672-CRB (JSC)

TABLE OF CONTENTS Page

I. INTRODUCTION ................................................................................................................... 1

II. FACTS COMMON TO THE CLAIMS OF ALL CLASS MEMBERS ................................. 1

A. Bosch’s Coconspirators VW and IAV Plead Guilty to Crimes Related to Dieselgate. .................................................................................................. 1

B. Bosch Played a Key Role in the Development of the Software That Was At The Core of the Emissions Scheme. ............................................................... 3

C. Bosch Disguised the Defeat Device from Regulators While Promoting “Clean Diesel.” ........................................................................................ 11

D. Bosch Sold and Disguised the Defeat Device as a “Special Feature.” .................................................................................................................... 12

E. Bosch Requested Indemnification from Volkswagen to Evade Liability. .................................................................................................................... 14

F. Revelation of the Scheme Has A Direct and Foreseeable Impact on VW Dealers – The Stop-Sale Orders and Termination of TDI Models in the United States. ...................................................................................... 15

III. ARGUMENT ........................................................................................................................ 16

A. Legal Standards ......................................................................................................... 16

B. Plaintiffs satisfy Rule 23(a) for the RICO claims and state-law civil conspiracy claims. ..................................................................................................... 17

1. The Class is identifiable and ascertainable. ................................................... 17

2. Rule 23(a)(1)—the Class is too numerous for joinder. ................................. 17

3. Rule 23(a)(2)—common issues exist for the RICO and state-law claims. ............................................................................................ 17

4. Rules 23(a)(3)—Plaintiffs’ claims are typical of the claims of all Class members. .................................................................................... 17

5. Rule 23(a)(4)—The Class Representatives and Class Counsel will adequately protect the interests of the Classes. ........................ 18

C. The Class should be certified under Rule 23(b)(3) as to the RICO claim. ......................................................................................................................... 19

1. Common answers to common questions predominate under RICO. ............................................................................................................. 19


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MOTION FOR CLASS CERTIFICATION - ii Case No.: 02672-CRB (JSC)

2. Plaintiffs provide a common methodology of proving class-wide impact and damages for both RICO and conspiracy claims. ............................................................................................................ 27

D. Plaintiffs’ state-law civil conspiracy claims raise predominately common issues with common answers. ..................................................................... 32

1. Applicable legal standards. ............................................................................ 32

2. Civil conspiracy will be proved with common evidence and common legal standards. ............................................................................... 33

3. Common-law fraud will be proved with common facts based on common legal standards. ................................................................ 34

E. A class action for the RICO and civil-conspiracy claims is superior to any other method for adjudicating the controversy. .............................................. 39

IV. CONCLUSION ..................................................................................................................... 40


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MOTION FOR CLASS CERTIFICATION - iii Case No.: 02672-CRB (JSC)

TABLE OF AUTHORITIES Page(s)

CASES

Aetna, Inc. v. Health Diagnostic Lab. Inc., 2015 WL 9460072 (E.D. Pa. Dec. 28, 2015) ................................................................................ 36

Alliance Mortg. Co. v. Rothwell, 10 Cal. 4th 1226 (1995) ................................................................................................................. 39

Amgen Inc. v. Conn. Ret. Plans & Tr. Funds, 568 U.S. 455 (2013) ...................................................................................................................... 16

Boardakan Rest. LLC v. Gordon Grp. Holdings, LLC, 2015 WL 4597970 (E.D. Pa. July 31, 2015) ................................................................................. 38

Cafaro v. Zois, 693 F. App’x 810 (11th Cir. 2017) ................................................................................................ 37

CGC Holding Co., LLC v. Broad & Cassel, 773 F.3d 1076 (10th Cir. 2014) ..................................................................................................... 23

In re Chrysler-Dodge-Jeep EcoDiesel Mktg., Sales Practices, & Prods. Liab. Litig., 2019 WL 536661 (N.D. Cal. Feb. 11, 2019) ................................................................................. 33

In re Chrysler-Dodge-Jeep EcoDiesel Mktg., Sales Practices, & Prods. Liab. Litig., 295 F. Supp. 3d 927 (N.D. Cal. 2018) ..................................................................................... 32, 34

Coffey v. WCW & Air, Inc., 2018 WL 4154256 (N.D. Fla. Aug. 30, 2018) .............................................................................. 37

Cohen v. Trump, 303 F.R.D. 376 (S.D. Cal. 2014) ................................................................................................... 23

Cote v. R.J. Reynolds Tobacco Co., 909 F.3d 1094 (11th Cir. 2018) ............................................................................................... 35, 36

Dent v. NFL, 902 F.3d 1109 (9th Cir. 2018) ................................................................................................. 35, 36

Downs v. Borough of Jenkintown, 2019 WL 1383802 (E.D. Pa. Mar. 26, 2019) ................................................................................ 34

In Re Duramax Diesel Litig., 298 F. Supp. 3d 1037 (E.D. Mich. 2018) ................................................................................ 31, 38

Edward J. DeBartolo Corp. v. Coopers & Lybrand, 928 F. Supp. 557 (W.D. Pa. June 11, 1996) .................................................................................. 39


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MOTION FOR CLASS CERTIFICATION - iv Case No.: 02672-CRB (JSC)

In re First Alliance Mortg. Co., 471 F.3d 977 (9th Cir. 2006) ......................................................................................................... 32

Flores v. United Parcel Serv., Inc., 2019 WL 1777280 (9th Cir. Apr. 23, 2019) .................................................................................. 22

In re Gen. Motors LLC Ignition Switch Litig., 257 F. Supp. 3d 372 (S.D.N.Y. 2017) ........................................................................................... 36

Gen. Refractories v. Fireman’s Fund Ins. Co., 337 F.3d 297 (3d Cir. 2003) .......................................................................................................... 34

Gnagey Gas & Oil Co. v. Pa. Underground Storage Tank Indemnification Fund, 82 A.3d 485 (Pa. Commw. Ct. 2013) ...................................................................................... 35, 36

Hamilton v. Speight, 2019 WL 161731 (E.D. Pa. Jan. 10, 2019) .................................................................................... 38

Hauben v. Harmon, 605 F.2d 920 (5th Cir. 1979) ......................................................................................................... 37

Hess v. Philip Morris USA, Inc., 175 So. 3d 687 (Fla. 2015) ...................................................................................................... 35, 36

Hodson v. Mars, Inc., 891 F.3d 857 (9th Cir. 2018) ................................................................................................... 35, 37

Hollister Inc. v. Zassi Holdings, Inc., 752 F. App’x 888 (11th Cir. 2018) ................................................................................................ 39

Joiner v. McCullers, 28 So. 2d 823 (Fla. 1947) .............................................................................................................. 35

Just Film, Inc. v. Buono, 847 F.3d 1108 (9th Cir. 2017) ................................................................................................. 22, 27

Kirola v. City & Cty. of San Francisco, 860 F.3d 1164 (9th Cir. 2017) ....................................................................................................... 32

Kutza v. Williams-Sonoma, Inc., 2018 WL 5886611 (N.D. Cal. Nov. 9, 2018) .......................................................................... 32, 33

LEM 2Q, LLC v. Guar. Nat’l Title Co., 144 A.3d 174 (2016) (Pa. Super. Ct. 2016) ....................................................................... 35, 36, 38

Leyva v. Medline Indus. Inc., 716 F.3d 510 (9th Cir. 2013) ......................................................................................................... 27

Menocal v. GEO Grp., Inc., 882 F.3d 905 (10th Cir.), cert. denied, 139 S. Ct. 143 (2018) ...................................................... 23


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MOTION FOR CLASS CERTIFICATION - v Case No.: 02672-CRB (JSC)

In re Mercedes-Benz Emissions Litig., 2019 WL 413541 (D.N.J. Feb. 1, 2019) ........................................................................................ 38

MP, LLC v. Sterling Holding, LLC, 231 So. 3d 517 (Fla. Dist. Ct. App. 2017) ..................................................................................... 33

Norcia v. Samsung Telecomms. Am., LLC, 2018 WL 4772302 (N.D. Cal. Oct. 1, 2018) ................................................................................. 37

Pecanha v. The Hain Celestial Grp., Inc., 2018 WL 534299 (N.D. Cal. Jan. 24, 2018) .................................................................................. 32

Philip Morris USA, Inc. v. Duignan, 243 So. 3d 426 (Fla. Dist. Ct. App. 2017) ..................................................................................... 35

Ponomarenko v. Shapiro, 287 F. Supp. 3d 816 (N.D. Cal. 2018) ........................................................................................... 33

Rissmiller v. NGK N. Am., Inc., 2018 WL 4203839 (E.D. Pa. Sept. 4, 2018) .................................................................................. 36

Robinson v. Unilever United States, 2018 WL 6136139 (C.D. Cal. June 25, 2018) ............................................................................... 32

Scaife Co. v. Rockwell-Standard Corp., 285 A.2d 451 (Pa. 1971) ................................................................................................................ 39

Silverman v. Bell Sav. & Loan Ass’n, 533 A.2d 110 (Pa. Super. Ct. 1987) .............................................................................................. 39

Spencer v. Hartford Fin. Servs. Grp., Inc., 256 F.R.D. 284 (D. Conn. 2009) ................................................................................................... 33

Staton v. Boeing Co., 327 F.3d 938 (9th Cir. 2003) ......................................................................................................... 16

Tinsley v. Snyder, 2019 WL 1868287 (9th Cir. Apr. 26, 2019) .................................................................................. 17

Torres v. S.G.E. Mgmt., L.L.C., 838 F.3d 629 (5th Cir. 2016) ................................................................................................... 22, 23

In re U.S. FoodService Inc. Pricing Litig., 729 F.3d 108 (2d Cir. 2013) .......................................................................................................... 23

United Nat’l Ins. Co. v. Aon Ltd., 2008 WL 3819865 (E.D. Pa. Aug. 8, 2008) .................................................................................. 38

United States v. Colton, 231 F.3d 890 (4th Cir. 2000) ......................................................................................................... 34


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MOTION FOR CLASS CERTIFICATION - vi Case No.: 02672-CRB (JSC)

United States v. Stapleton, 293 F.3d 1111 (9th Cir. 2002) ....................................................................................................... 25

United States v. Woods, 335 F.3d 993 (9th Cir. 2003) ......................................................................................................... 22

In re Volkswagen “Clean Diesel” Mktg., Sales Practices, & Prods. Liab. Litig., 349 F. Supp. 3d 881 (N.D. Cal. 2018) ........................................................................................... 38

In re Volkswagen “Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 2016 WL 6091259 (N.D. Cal. Oct. 18, 2016) ........................................................................ passim

In re Volkswagen “Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 2017 WL 4890594 (N.D. Cal. Oct. 30, 2017) ........................................................................ passim

In re Volkswagen “Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 229 F. Supp. 3d 1052 (N.D. Cal. 2017) ......................................................................................... 17

In re Volkswagen “Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 2017 WL 672820 (N.D. Cal. Feb. 16, 2017) ................................................................................. 40

Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) ...................................................................................................................... 17

Waldrup v. Countrywide Fin. Corp., 2018 WL 799156 (C.D. Cal. Feb. 6, 2018) ................................................................................... 23

Wortman v. Air New Zealand, 326 F.R.D. 549 (N.D. Cal. 2018) ............................................................................................ 16, 19

Youndt v. First Nat’l Bank of Port Allegany, 868 A.2d 539 (Pa. Super. Ct. 2005) .................................................................................. 35, 37, 38

ZC Ins. Co. v. Brooks, 847 So. 2d 547 (Fla. Ct. App. 2003) ............................................................................................. 38

STATUTES

18 U.S.C. § 1961 ................................................................................................................................. 26

OTHER AUTHORITIES

Fed. R. Civ. P. 23 .................................................................................................................... 16, 17, 40

Restatement (Second) of Torts § 551 .................................................................................................. 38


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MOTION FOR CLASS CERTIFICATION - vii Case No.: 02672-CRB (JSC)

GLOSSARY OF TERMS

TERM DEFINITION CITATIONS IN MOTION

AdBlue A urea and water solution injected into the exhaust system to treat emissions. pp. 2, 9

“Akustikfunktion” or “acoustic function”

The code name developed by Bosch and VW for the software modification that switched on the emissions system during testing. pp. 4, 6-14

CARB or (“ARB”) California Air Resources Board (or “Air Resources Board”). pp. 3, 12 n.47

Cycle-beater Software that will active the emissions controls if it detects it is undergoing emissions testing. pp. 4, 8, 12

Defeat device A device that reduces the effectiveness of emissions control systems in real-world drive conditions. pp. 2, 3, 7-14

EDC Electronic Diesel Control. Hardware which housed software that controlled a vehicle’s operation. p. 1

EDC 16

The EDC developed by Bosch for earlier model Audis that injected more fuel at ignition to minimize noise. pp. 4, 8 n.30

EDC 17

The EDC developed by Bosch for the Dirty Diesels which controlled performance of the vehicles’ emissions system. pp. 4-6

“Fld InjCrvNsCharCor” The name of a software function that activates the defeat device. p. 4 n.10

FP sheets Function specification sheets Bosch used to modify the EDC 17. p. 11

IAV IAV GmbH, an automotive engineering company 50% owned by VW AG.

pp. 1, 3, 6-7, 11

“InjCrv stNsCharCor” The name of the software function that injected diesel to facilitate the defeat device. p. 4 n.10

OEMs Original Equipment Manufacturers (shorthand in this case for automobile manufacturers). pp. 6, 12-14

SCR

Selective Catalytic Reduction, which is a method for converting nitrogen oxides into water and harmless gas. pp. 7, 13

“Special Characteristics”

A sales term created by Bosch to refer to the software it developed to evade emissions testing. pp. 1, 13, 14

SW Emissions software. pp. 4, 12

TDI vehicles Turbocharged direct injection diesel vehicles manufactured by VW. pp. 2, 15, 31

US07

Shorthand for the effort by Bosch and VW to develop an emissions system that would meet the EPA 2007 emissions standards. pp. 5, 6


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MOTION FOR CLASS CERTIFICATION - viii Case No.: 02672-CRB (JSC)

KEY PERSONNEL

NAME ENTITY JOB TITLE Bosch GmbH

Bosch GmbH

Bosch GmbH

Bosch GmbH

Bosch GmbH Bosch GmbH

Norman Johnson Bosch LLC Director – Governmental and External Affairs

Bosch GmbH

VW AG

Bosch GmbH

Bosch GmbH VW AG


Bosch GmbH


Bosch GmbH

Bosch GmbH

Bosch GmbH




Bosch GmbH


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MOTION FOR CLASS CERTIFICATION - 1 Case No.: 02672-CRB (JSC)

NOTICE OF MOTION AND MOTION

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:

PLEASE TAKE NOTICE that on November 1, 2019, at 10:00 a.m., or as soon thereafter as

the matter may be heard by the Honorable Charles R. Breyer of the United States District Court of

the Northern District of California, San Francisco Division, located at 450 Golden Gate Avenue, San

Francisco, California, Courtroom 6, 17th Floor, Plaintiffs will and hereby do move the Court under

Federal Rules of Civil Procedure 23 for an order:

(1) certifying a class of all persons or entities who owned a Volkswagen-branded franchise dealership that operated in the United States as of September 18, 2015 (the “Class”);

(2) certifying the Class for claims under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1962(c)–(d) and for civil conspiracy to defraud under the laws of all fifty states;

(3) appointing all three Plaintiffs as Class representatives; and

(4) appointing Hagens Berman Sobol Shapiro LLP and Bass Sox Mercer as Class Counsel under Fed. R. Civ. P. 23(g).

This motion is based upon this notice of motion and motion for class certification, the

following memorandum of points and authorities, the accompanying declarations of Steve W.

Berman, Jason Kuhn, Greg Bozzani, and John Bertolet, the pleadings and papers on file in this

action, the arguments of counsel presented at the hearing of this motion, and such further matters as

the Court may consider.

DATED: June 14, 2019 HAGENS BERMAN SOBOL SHAPIRO LLP

By: /s/ Steve W. Berman Steve W. Berman (Pro Hac Vice)

Thomas E. Loeser (SBN 202724) 1301 Second Avenue, Suite 2000 Seattle, WA 98101 Telephone: (206) 623-7292 Facsimile: (206) 623-0594 [email protected] [email protected]


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Richard N. Sox (Pro Hac Vice) BASS SOX MERCER 2822 Remington Green Circle Tallahassee, FL 32308 Telephone: (850) 878-6404 Facsimile: (850) 942-4869 [email protected]

Counsel for Plaintiffs and the Franchise Dealer Class


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I. INTRODUCTION

Plaintiffs seek certification of a Class of all persons or entities who owned a Volkswagen-

branded franchise dealership that operated in the United States as of September 18, 2015. Whether

Bosch’s misconduct is viewed through the lens of RICO or civil conspiracy, its conduct was

uniformly directed at all Class members causing common injury. The common questions of law

and fact raised by this course of conduct decisively predominate, and will result in answers

common to all Class members. The best, fairest, most consistent—and likely the only practical—

way to litigate this case is as a class action. Plaintiffs therefore respectfully request that the Court

grant their motion.

II. FACTS COMMON TO THE CLAIMS OF ALL CLASS MEMBERS

Common evidence will show that Bosch, VW, and software developer IAV worked

together to develop modifications to the emissions software for the Dirty Diesels1 to deceive

regulators, dealers and consumers in violation of RICO and civil conspiracy laws. Set forth below

is a proffer of some of the common evidence that Plaintiffs will use to prove on a classwide basis

Bosch’s liability under RICO and civil conspiracy. Bosch provided hardware to VW in the form of

an electronic diesel control (“EDC”), which housed a computer running software that controlled

vehicle emission systems. Bosch was an integral part of a scheme to develop proprietary software

that allowed the Dirty Diesels to detect and pass emissions tests, even as they spewed high levels of

pollutants in real-world driving conditions. As shown below, Bosch, VW, and IAV agreed to

—a clear recognition that they knew their conduct was illegal.

A. Bosch’s Coconspirators VW and IAV Plead Guilty to Crimes Related to Dieselgate.

VW has admitted its role in the conspiracy, and agreed to pay a $2.8 billion fine. On

March 10, 2017, Volkswagen AG pleaded guilty in the Eastern District of Michigan to three

1 Dirty Diesels are those subject to the EPA’s NOVs and are identified in the Third Amended

Complaint (“TAC”), ECF No. 5862, ¶ 6.


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counts: (1) Conspiracy to violate the Clean Air Act; (2) Obstruction of Justice, and (3) Importation

of Merchandise by Means of False Statements.2 In its guilty plea, VW admitted3 that, from May

2006 to November 2015, it represented to regulators, dealers and customers that its vehicles met

emissions standards and that it “agreed to deceive U.S. regulators and U.S. customers about

whether the Subject Vehicles and the Porsche Vehicles4 complied with U.S. emissions standards.”

Id. ¶¶ 30-31. The conspiracy centered on the 2.0 liter and the 3.0 liter (“TDI”) vehicles. Regarding

the 2.0 liter vehicles, VW AG admitted that key personnel knew that “VW was using software to

cheat the U.S. testing process. Id. The software was designed to detect when the vehicles were

undergoing emissions testing, and upon detection would switch to a mode that would pass the

testing. Id. ¶ 34. The software also detected when the vehicles were being driven on the road, and

would substantially derate the emissions system to improve the vehicle’s performance. Id.

According to the guilty plea, starting in or around 2006, Audi AG engineers developed a

3.0 liter diesel vehicle for the U.S. market, with a more powerful engine. Id. ¶ 39. The engineers

also developed a defeat device that, through software coding, varied the injection of a urea and

water solution (called AdBlue) into the exhaust system based on whether the vehicle was

undergoing emissions testing. The goal of this defeat device was to reduce the AdBlue tank size to

make the trunk roomier and to decrease required service intervals, both of which VW believed was

important for the U.S. market. Id. ¶ 40.

In 2011, VW launched a second generation of 2.0 Liter vehicles. Following a series of

hardware problems upon their launch in 2012, the emissions software was modified so that it could

detect when the steering wheel was turning, to more accurately detect when the vehicle was being

2 See United States v. Volkswagen AG, 16-CR-20394 (E.D. Mich.), “Rule 11 Plea Agreement,”

ECF No. 68 (attached as Ex. 48 to the Declaration of Steve W. Berman in Support of Plaintiffs’ Motion for Class Certification). All references to “Ex.” herein are to the Berman Declaration.

3 The admissions are in the Statement of Facts attached to the plea which VW cannot contest. Plaintiffs will depose a VW representative to admit these facts so they are admissible in this case.

4 Collectively, the Subject Vehicles and the Porsche Vehicles are virtually identical to the Dirty Diesels in this case. See Third Amended Complaint, ECF No. 5862, ¶ 6.


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driven on the road. Id. ¶ 49. As shown below, Bosch was a participant in each of the foregoing

schemes.

In March 2014, VW learned that researchers at West Virginia University had determined

that two VW vehicles, when tested on the road, were emitting approximately 40 times the

permissible limits of NOx. EPA and CARB soon began investigating, in part by asking VW

questions and doing their own testing. Id. ¶ 53. In response to these inquiries, VW admitted that it

worked to thwart the investigation and did not disclose the defeat devices and software

manipulation.

On December 17, 2018, IAV GmbH, also pled guilty to conspiracy to violate the Clean Air

Act in connection with the dieselgate scandal.5 As part of the plea, IAV admitted that from at least

May 2006 to November 2015, “IAV and its co-conspirators, including VW, worked on the design

and calibration of engine control units containing defeat devices and agreed to defraud U.S.

regulators and U.S. customers, and violate the Clean Air Act, by misleading U.S. regulators and

U.S. customers about whether the [VW] 2.0 liter diesel engine vehicles for MY 2009-2014

(collectively, the ‘Gen 1 Vehicles’) complied with U.S. emissions standards.” Id. ¶ 19. In

particular, IAV “worked collaboratively in designing, testing, implementing, and improving

software they knew that VW was using to cheat the U.S. testing process by making it appear as if

the Gen 1 Vehicles met U.S. emissions standards when, in fact, they did not.” Id. ¶ 19.

B. Bosch Played a Key Role in the Development of the Software That Was At The Core of the Emissions Scheme.

Common evidence will demonstrate that the Bosch entities were a key player in every

aspect of this conspiracy, and joined with VW and IAV to both plan and program the cheating

software and to conceal it.6 This illicit partnership was forged by Bosch’s work developing illegal

software modifications for previous Audi models. Starting in 1999, VW sought to dampen the loud

5 See United States v. IAV GmbH, 16-CR-20394 (E.D. Mich.), “Plea Agreement,” ECF No. 138

(Ex. 49). 6 In Bosch’s motion to dismiss, Bosch claimed knowledge of the defeat device was limited to a

small group of VW employees and that Bosch was not part of the communications involving the same. ECF No. 4175, at p. 8, ll. 21-26; see also, p. 9, ll. 3-7, p. 1, ll. 21-25. As demonstrated herein, this pleading is false and/or misleading.


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clattering noise that its Audis made upon startup. But the fix for this problem – injecting more fuel

into the engine upon ignition – exceeded European emissions standards during testing.7 Audi and

Bosch jointly developed an illegal modification to the software controlling the added fuel injection

by turning it on only when in real-world driving conditions.8 Since this feature was developed to

correct a perceived acoustics problem, the development of illegal emissions testing software

modifications became known at Bosch and VW as an “acoustic function,” and that code word

remained long after the function had anything to do with acoustics.

In an April 28, 2009 email entitled

” Bosch employee succinctly summarized the history of the “

:

9

then described how the illegal software modification worked in VW vehicles: “

” Id. (emphasis added).10 concluded by

noting, “

7 See State of New York v. Volkswagen Aktiengesellschaft, 904021-16 (N.Y. Sup. Ct.), ¶ 72

(NYSCEF Doc. No. 2). 8 Bosch’s own documents demonstrate this fact.

See Ex. 1, RBG-MDL2672-NE-

002647737, at 6.

. Id. at 7. 9 Ex. 2, RBG-MDL2672-NE-002142948 (emphasis added). 10 See also Ex. 3, RBG-MDL2672-NE-003641254 (

.”) (emphasis added).


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.” Id. A Bosch colleague

responded,

” Id. The answer as to legality was “

.”11

12

To the extent secret software manipulation was at the heart of the scheme as admitted by

VW and IAV, the terms of the operative contract between VW and Bosch were unequivocal that

Bosch controlled the software. On April 7, 2005, Bosch GmbH and VW AG entered into

13 Id. at 2. The specific provisions detailing the Bosch/VW partnership are detailed below.

Id. at 2-6.

Id. at 7. Id. at 7-8.

Id. at 9.

The purpose of the Agreement was to develop software for diesel vehicles, and was the

development platform for the first diesels set to be launched in 2009. The project became known as

the “US07” project. The importance of Bosch’s collaboration in the US07 project was recognized

and celebrated by VW.

11 Ex. 4, RBG-MDL2672-NE-002124057. 12 Ex. 5, RBG-MDL2672-NE-002124063. 13 See Ex. 6, VW-MDL2672-03752699.


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14

15

Id. For its part, Bosch

emphasized that it could easily tailor emissions software to meet OEMs’ needs. On February 28,

2006, Bosch issued a press release entitled “EDC17: Ready for future demands.”16

Bosch’s documents show beyond any doubt that it was modifying the illegal software for

VW.

17

8

9 In an article entitled “How They

14 See Ex. 7, RBG-MDL2672-NE-003093990. 15 See Ex. 8, RBG-MDL2672-NE-003093992, at 2 (emphasis added). 16 See Feb. 28, 2006 Bosch press release, “The brain of diesel injection: New Bosch EDC17

engine management system,” http://www.bosch-presse.de/presseforum/details.htm?txtID=2603&locale=en.

17 Ex. 9, RBG-MDL2672-NE-002694535. 18 Ex. 10, RBG-MDL2672-NE-001936607. 19 Ex. 11, RBG-MDL2672-NE-002559780 (excerpt). As stated in the spreadsheet, the column

entitled “Translation” was not in the original, but added by a translator retained by plaintiffs.


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Did It: An Analysis of emission Defeat Devices in Modern Automobile,” the authors were able to

access the Bosch function sheets and determine the software commands that manipulated

emissions.20 A review of documents produced by Bosch reveal those same code strings are present

and have the same illicit function described in the article.21

Bosch internally discussed the implementation of the defeat device and discussed how it

would be used in specific models:

22

3 In a November 2, 2009 email, a Bosch employee also

confirmed that the “

24

Documents also reveal that Bosch worked quickly to fix any bugs in the software related to

the acoustic function.

25

6

20 Ex. 47. 21 See Ex. 46. 22 Ex. 12, RBG-MDL2672-NE-001948207. 23 Ex. 13, RBG-MDL2672-NE-001819747. 24 Ex. 14, RBG-MDL2672-NE-004233587. 25 Ex. 15, RBG-MDL2672-NE-001966439. 26 Ex. 16, RBG-MDL2672-NE-001873113.


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Id. at 2.

Id. at 1.

Id. Viewed in context of the entire

document, the engineer’s last statement was certainly sarcastic and made with the understanding

that everyone on the email chain was in on the joke.

Problems with the acoustic function were treated differently, and required a higher level of

review, compared to other technical problems. For example,

9

0

27 Ex. 17, RBG-MDL2672-NE-001935895, at 2. 28 Ex. 18, RBG-MDL2672-NE-001935818. 29 Ex. 19, RBG-MDL2672-NE-002121559. 30 Id. at 2; see also Ex. 20, RBG-MDL2672-NE-002296578

.


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One aspect of the scheme was, due to the AdBlue tank size, to program vehicles to use less

AdBlue in real world driving conditions.31 Bosch was there for VW as it helped develop

modifications to the AdBlue dosing so that a smaller tank could be used and refill intervals

enlarged.

2

The special feature was described as follows:

This presentation

was circulated widely within Bosch management. Id.33 VW has admitted in its plea that part of the

scheme was to reduced AdBlue dosing in real world conditions.

Bosch employees also openly discussed that the purpose of the acoustics function was to

pass emissions tests.

4

Id. at 4.

In internal communications, VW personnel made clear that Bosch’s technical expertise and

assistance was necessary for the acoustic function.

31 Rule 11 Plea Agreement ¶ 42. 32 Ex. 21, RBG-MDL2672-NE-003307529, at 3. 33 See Rule 11 Plea Agreement ¶¶ 39-40 regarding varying injections of urea and the AdBlue

tank. 34 Ex. 22, RBG-MDL2672-NE-001991853.


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35

Proof that Bosch knew exactly what it was doing – and carefully tracked the performance

of the acoustics function – also comes from its scramble to evade liability after the September 15,

2015 NOV.

3 3

38 After the EPA’s NOV Bosch took the position, like the infamous

Sergeant Schultz from Hogan’s Heroes’, that it knew nothing:

39 This post-scandal denial of

responsibility for calibrating and configuring is a marked departure from the truth emailed in a

0

Just recently, Bosch all but admitted its culpability in developing software that cheats

emissions. On May 23, 2019, German prosecutors announced that Bosch agreed not to contest a

$100 million fine for its role in the diesel cheating scheme based on its work with VW. According

to a news article, prosecutors stated that Bosch “was responsible for some 17 million computers

that eventually held software that helped Volkswagen Group cheat on emissions tests.”41

35 Ex. 23, VW-MDL2672-02569922. 36 Ex. 24, RBG-MDL2672-NE-004350618. 37 Ex. 25, RBG-MDL2672-NE-004350623. 38 See supra note 36 (citing -004350618). 39 See Ex. 26, RBL-MDL2672-NE-000014395. 40 Ex. 27, RBG-MDL2672-NE-001873504. Again this evidence cannot be squared with

statements in Bosch’s motion to dismiss that the deception was “limited to a small group of VW employees” (ECF No. 4175, p. 8) or that Bosch had an ordinary business relationship with VW (p. 10).

41 See “Germany Slaps Bosch with $100 million fine for role in Dieselgate” (May 23, 2019), https://www.cnet.com/roadshow/news/germany-bosch-dieselgate-fine/.


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C. Bosch Disguised the Defeat Device from Regulators While Promoting “Clean Diesel.”

Bosch and VW AG recognized and agreed from the beginning that details regarding the

software modification should not be described in documentation in order to avoid detection by

regulators. For example,

4 Id.

Id.

43

44

.4

Id.

Id.

Even as Bosch was faking the documentation, it shamelessly promoted “Clean Diesel.” On

Feb. 1-2, 2006, it hosted a “Bosch Clean Diesel Day” in Sacramento, California. As Bosch

described it in a letter to VW

42 Ex. 28, RBG-MDL2672-NE-002273872. 43 Ex. 29, RBG-MDL2672-NE-002273871. 44 Ex. 30, RBG-MDL2672-NE-002273869. 45 Ex. 31, RBG-MDL2672-NE-002697447.


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6

Bosch continued to host events where it disingenuously promoted its “clean diesel” technology,

even as it was creating defeat devices that insured the emissions systems stayed dirty.47 A Bosch

document confirms that

48

D. Bosch Sold and Disguised the Defeat Device as a “Special Feature.”

When Bosch personnel learned about the defeat device, some of them were cognizant of its

illegality and sought to place the blame on VW for its development. For example,

, and appeared to

have discovered the acoustic function for the first time. In response, he sought to minimize Bosch’s

involvement and shift all the blame on VW for its creation, although he appeared to recognize that

this was a tenuous position. Hence, in an email chain dated November 2, 2009, emailed

several Bosch employees (including

a PowerPoint regarding the defeat device.49 responded, “[t]here is a possibility in our

software to ‘misuse’? . . . If this is correct, then we must just mention this as you suggested in

‘special features.’ Of course the wording should not mention ‘misuse’ . . . but we can say it in

better words.” Id. responded, and stated in part (id.; all emphases added):

o “we know – from >20 years of history – all about cycle beating.”

o “Bosch is releasing SW [software] + calibration (Bosch is encrypting the entire SW + calibration data). ==> how can it be that Bosch doesn’t know?”

46 Ex. 32, RBL-MDL2672-NE-000001273. 47 Ex. 33, RBG-MDL2672-NE-002430818

; Ex. 34, VW-MDL2672-03331605

”); Ex. 35, VW-MDL2672-00234381

). 48 Ex. 36, RBL-MDL2672-NE-000080391. 49 Ex. 37, RBG-MDL-NE-4170733.


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o “Special characteristics regarding safety etc. we are used to. The only new now is that this is a special characteristic regarding compliance with legal requirements.”

then became the point person for the cycle beating device, as demonstrated below:

”50

51

52

(id. at 2):

53

:54

50 Ex. 38, RBG-MDL-NE-002448436. .

He clearly did not want to interfere with the relationship with VW. 51 See Ex. 39, RBG-MDL-NE 2143427. 52 See Ex. 40, RBG-MDL2672-NE-001876208. 53 See Ex. 41, RBG-MDL2672-NE-004170803. 54 See Ex. 42, RBG-MDL2672-NE-004170804.


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o

5

56/57

This collection of emails and documents demonstrates that, when mid-level Bosch

employees learned of the acoustics function, they attempted to package the function as a “special

function” to sell to VW, but disclaim any responsibility for its use.

E. Bosch Requested Indemnification from Volkswagen to Evade Liability.

Finally, Bosch’s knowledge that the scheme to defraud regulators and the public was illegal

is also evidenced by its request for indemnification from VW.58

” Although VW never signed Bosch’s proposed indemnification agreement,

Bosch continued to work closely with VW to develop and modify the acoustics function after this

request.

55 See Ex. 43, RBG-MDL2672-NE-004170793. 56 See Ex. 44, RBG-MDL2672-NE-002297241. 57 Despite the overwhelming evidence that and were key actors in the

conspiracy, Bosch never identified them as custodians, and resisted Plaintiffs’ efforts to make them custodians. See Berman Declaration, ¶¶ 4-15.

58 See Ex. 45, VW-MDL2672-02570091.


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F. Revelation of the Scheme Has A Direct and Foreseeable Impact on VW Dealers – The Stop-Sale Orders and Termination of TDI Models in the United States.

In September 2015 and November 2015, Volkswagen issued separate stop-sale orders for

its TDI vehicles.59 The first ceased the sales of 2.0-liter vehicles; the second ceased the sales of the

Volkswagen Touareg, which had a 3.0-liter TDI engine, as well as certain Audi and Porsche

vehicles also equipped with 3.0 liter TDI engines. The stop sale orders immediately halted the sales

of new and Certified Pre-Owned (“CPO”) TDI vehicles. The arrested sales of new and CPO TDI

vehicles also prevented those TDI vehicles that would have been sold from becoming in-use

vehicles within the market. Collectively, the stop-sale orders deprived the Franchise Dealer Class

of the profits associated with: (a) new TDI sales, including profits on the vehicle sales themselves

and on ancillary related products; (b) used vehicle sales that would have flowed directly from the

new TDI sales; and (c) the fixed operations sales, including warranty, customer pay, and wholesale

sales.60 The effect of the stop sale orders related most closely to a franchise termination or

discontinuation, in that the profit opportunities that flowed to dealerships from the TDI vehicle

portion of the Volkswagen franchise ceased, leaving behind only the residual value associated with

the in-use TDI vehicles in the market. This cessation became permanent when Volkswagen

declared it would no longer sell TDI vehicles or any other diesel vehicles in the United States.61

In connection with a global class-action settlement with TDI vehicle owners, the FTC and

the DOJ, Volkswagen agreed to buy back all 2.0-liter TDI vehicles and 2009-2012 MY 3.0-liter

TDI Touaregs.62 The buyback resulted in the removal of approximately 78% of then in-use

Volkswagen TDI vehicles from the U.S. passenger fleet. The midpoint of the buyback occurred in

59 Kelly Pleskot, “Volkswagen Issues Stop-Sale on Diesel Cars Following Emissions Scandal,”

Motortrend.com (Sept. 21, 2015): https://www.motortrend.com/news/volkswagen-issues-stop-sale-on-diesel-cars-following-emissions-scandal/ and Kelly Pleskot, “VW Issues Stop-Sale on Cars with 3.0-Liter TDI V-6 Engines,” Motortrend.com (Nov. 4, 2015): https://www.motortrend.com/news/vw-issues-stop-sale-on-cars-with-3-0-liter-tdi-v-6-engines/.

60 Report of Edward M. Stockton In Support of Plaintiffs’ Motion for Class Certification at pp. 2-3, 12-15 (“Stockton Report”) (attached as Ex. 50 to the Berman Declaration).

61 See id. 62 Order Granting Final Approval of the 2.0-Liter TDI Consumer and Reseller Dealership

Class Action Settlement (ECF No. 2102) and Order Granting Final Approval of the Consumer and Reseller Dealership 3.0-Liter Class Action Settlement (ECF No. 3229).


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March 2017. The effect of the buyback was different from that of the stop-sale order, as it removed

from the market nearly 400,000 in-use TDI vehicles, reducing revenue opportunities and thus

profits to the Franchise Dealers by prematurely terminating fixed operations opportunities

associated with those vehicles.63

III. ARGUMENT

A. Legal Standards

Plaintiffs must prove by a preponderance of the evidence that the Class should be certified.

Wortman v. Air New Zealand, 326 F.R.D. 549, 554 (N.D. Cal. 2018). “Certification is a three-step

process.” Id. First, plaintiffs must show that an identifiable and ascertainable class exists. Second,

plaintiffs must meet Rule 23(a) requirements: numerosity, commonality, typicality, and adequacy.

Third, plaintiffs here must show the Class fulfills the Rule 23(b)(3)requirements: (1) “questions of

law or fact common to class members predominate over any questions affecting only individual

members,” and (2) “a class action is superior to other available methods for fairly and efficiently

adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). These two requirements of Rule 23(b)(3)

are known as “predominance” and “superiority.” Wortman, 326 F.R.D. at 554.

In analyzing a certification motion, a court may consider merits questions “to the extent—

but only to the extent—that they are relevant to determining whether the Rule 23 prerequisites for

class certification are satisfied.” Amgen Inc. v. Conn. Ret. Plans & Tr. Funds, 568 U.S. 455, 466

(2013). The certification inquiry may involve substantive analysis, but the “court may not go so far

... as to judge the validity” of a plaintiff’s claims. Staton v. Boeing Co., 327 F.3d 938, 954 (9th Cir.

2003).

63 See Stockton Report at pp. 14, 28-30.


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B. Plaintiffs satisfy Rule 23(a) for the RICO claims and state-law civil conspiracy claims.

1. The Class is identifiable and ascertainable.

Bosch has stipulated that the proposed class is ascertainable.64 See also, In re Volkswagen

“Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 229 F. Supp. 3d 1052, 1062–63 (N.D.

Cal. 2017) (granting final certification of settlement class).

2. Rule 23(a)(1)—the Class is too numerous for joinder.

The Class satisfies the numerosity requirement. In granting preliminary approval to the

Franchise Dealers’ settlement with Volkswagen, this Court stated that there “are 652 Eligible

Dealers and thus 652 potential Class Members. (Dkt. No. 1970 ¶ 2.12.) Plaintiff therefore satisfies

the numerosity requirement.” In re Volkswagen “Clean Diesel” Mktg., Sales Practices & Prods.

Liab. Litig., 2016 WL 6091259, at *7 (N.D. Cal. Oct. 18, 2016). The proposed Class here is

identical and thus satisfies Rule 23(a)(1).65

3. Rule 23(a)(2)—common issues exist for the RICO and state-law claims.

The proposed Class satisfies the requirement of “questions of law or fact common to the

class.” Fed. R. Civ. P. 23(a)(2). A single common question of law or fact suffices. Wal-Mart

Stores, Inc. v. Dukes, 564 U.S. 338, 369 (2011). Bosch has stipulated that common questions are

present. ECF No. 6365.

4. Rules 23(a)(3)—Plaintiffs’ claims are typical of the claims of all Class members.

As required by Rule 23(a)(3), Plaintiffs’ claims are “typical of the claims or defenses of the

class.” A class representative’s claims “are ‘typical’ if they are ‘reasonably coextensive with those

of absent class members; they need not be substantially identical.’” Tinsley v. Snyder, 2019 WL

1868287, at *7 (9th Cir. Apr. 26, 2019) (citation omitted). “The test of typicality is whether other

members have the same or similar injury, whether the action is based on conduct which is not

unique to the named plaintiffs, and whether other class members have been injured by the same

course of conduct.” Id. (citation and internal quotation marks omitted).

64 See ECF No. 6365. 65 Bosch refused to stipulate as to numerosity.


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Plaintiffs’ claims are typical of the Class members’ claims. In granting preliminary

approval to the Franchise Dealers’ settlement with Volkswagen, this Court stated that “Plaintiff’s

claims are based on the same pattern of wrongdoing as those brought on behalf of Class

Members…. Plaintiff and Class Members were also harmed by the same course of conduct,

namely, Volkswagen’s allegedly unauthorized and secret use of the defeat device which led to a

stop sale order on all Volkswagen diesel cars and to a decline in the worth of the Volkswagen

brand. Because Plaintiff’s claims and underlying facts are identical to those of the Class, Plaintiff

satisfies the typicality requirement.” Volkswagen “Clean Diesel”, 2016 WL 6091259, at *8. The

same analysis applies here.

5. Rule 23(a)(4)—The Class Representatives and Class Counsel will adequately protect the interests of the Classes.

Plaintiffs will “fairly and adequately protect the interests of the class,” as required by Rule

23(a)(4). As this Court stated in granting preliminary approval to the Franchise Dealers’ settlement

with Volkswagen, courts “ask: (1) do the named plaintiffs and their counsel have any conflicts of

interest with other Class Members and (2) will the named plaintiffs and their counsel prosecute the

action vigorously on behalf of the class?” Volkswagen “Clean Diesel”, 2016 WL 6091259, at *8

(citation and internal quotation marks omitted). In granting preliminary approval to the Franchise

Dealers’ settlement with Volkswagen, this Court explained that “Plaintiff represents it is

‘committed to the action and has devoted substantial time to assisting counsel with this action,

providing documents and reviewing pleadings.’ (Dkt. No. 1971 at 20; see Dkt. No. 1972 ¶ 15.) At

this point, nothing in the record suggests Plaintiff has any conflicts with Class Members or

otherwise cannot adequately represent the Class.” Id. Similarly, the three named plaintiffs in the

Third Amended Complaint represent that they are committed to the litigation.66 Therefore, they

satisfy the adequacy requirement.

Proposed Class Counsel also satisfy Rule 23(a)(4). In granting preliminary approval to the

Franchise Dealers’ settlement with Volkswagen, this Court stated that “Class Members are also

66 See Declarations of Jason Kuhn, Greg Bozzani, and John Bertolet.


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represented by adequate counsel. Both Hagens Berman and Bass Sox Mercer are experienced

counsel…. In light of the foregoing, it appears Plaintiff is able to vigorously prosecute this action

through qualified counsel.” Id. The same attorneys continue to represent the proposed Class and

seek appointment as Class Counsel. Therefore, Plaintiffs meet the adequacy requirement.

C. The Class should be certified under Rule 23(b)(3) as to the RICO claim.

The proposed Class satisfies Rule 23(b)(3) for the RICO claim. “Rule 23(b)(3)’s first test,

predominance, itself consists of two parts. First, a plaintiff must show that common questions of

law and fact predominate over individual questions. Second, a plaintiff must present a model of

damages that (1) identifies damages that stem from the defendant’s alleged wrongdoing and (2) is

‘susceptible of measurement across the entire class.’ Comcast Corp. v. Behrend, 569 U.S. 27, 133

S. Ct. 1426, 1433–34, 185 L.Ed.2d 515 (2013).” Wortman, 326 F.R.D. at 557–58. Plaintiffs need

not prove their claims with evidence at this juncture. See id. at 558 (“Plaintiffs present extensive

evidence of Defendant’s participation in collusive behavior, but even if they had not, certification

would still be proper. Proof is not a prerequisite for class certification.”).

1. Common answers to common questions predominate under RICO.

a. Common evidence will be used to prove that all Plaintiffs and Class members have statutory RICO standing.

RICO standing is limited “to those who have suffered (1) an injury to ‘business or

property,’ that is (2) ‘by reason of’ a RICO violation. 18 U.S.C. § 1964(c).” In re Volkswagen

“Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 2017 WL 4890594, at *4 (N.D. Cal.

Oct. 30, 2017) (“MTD Order”). Both requirements will be proved with common evidence, yielding

common answers for all Plaintiffs and Class members.

(1) Injury to business or property

Common evidence will prove that all Plaintiffs and Class members suffered the same

injuries to business or property under RICO. In granting preliminary approval to the Franchise

Dealers’ settlement with Volkswagen, this Court stated that “Plaintiff and Class Members were

also harmed by the same course of conduct, namely, Volkswagen’s allegedly unauthorized and

secret use of the defeat device which led to a stop sale order on all Volkswagen diesel cars and to a


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decline in the worth of the Volkswagen brand.” Volkswagen “Clean Diesel”, 2016 WL 6091259,

at *8. Similarly in denying Bosch’s motion to dismiss the Second Amended Complaint, this Court

concluded that “the Franchise Dealers have plausibly alleged multiple injuries to their business and

property interests, and these injuries are sufficiently concrete to survive a motion to dismiss. The

stop-sale order has prevented the Franchise Dealers from selling their inventory of affected

vehicles. (SAC ¶¶ 4, 21, 29, 285.)” MTD Order, 2017 WL 4890594, at *6. This Court further

found that “as a result of this deprivation, the Franchise Dealers plausibly allege that they have lost

profits, have incurred inventory carrying costs, have had to purchase replacement inventory, and

have lost servicing revenues from the vehicles they could not legally sell. (See SAC ¶ 441(c), (d),

(f), (i).)” Id. And the Franchise Dealers “also allege that they overpaid for the ‘clean diesels,’

believing they were compliant with U.S. emission standards. (Id. ¶ 441(a).) This out-of-pocket loss

is also a cognizable injury to the Franchise Dealers’ property…. The mirror image injury is also

cognizable: the value of the Franchise Dealers’ inventory of affected vehicles declined in value

after the fraud was disclosed.” Id.67

Based on common evidence, Plaintiffs will establish that they and all Class members

suffered RICO injuries. The stop-sale orders, termination of the TDI product lines and buyback of

nearly 400,000 in-use TDIs applied to all Plaintiffs and Class members and necessarily caused

them to suffer the types of RICO injuries identified by this Court.68

(2) Injury “by reason of” a RICO violation

Plaintiffs will establish “but for” and proximate cause for all Class members with common

evidence. As this Court has explained, Plaintiffs’ allegations “plausibly support that, ‘but for’ the

alleged enterprise, the Franchise Dealers would not have suffered the injuries they allege. Each

injury stems from the defeat device, which when discovered led to a drop in the value of the ‘clean

diesels’ and the stop-sale order.” MTD Order, 2017 WL 4890594, at *8. So, common evidence will

be used to show “but for” causation for all Class members.

67 The Third Amended Complaint contains the same allegations of RICO injuries suffered by

Plaintiffs and Class members. See TAC ¶¶ 4, 22, 28, 34, 315, 317, 335, 336, 438, 441. 68 See, e.g., Stockton Report at pp. 13-18.


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Similarly, Plaintiffs will utilize common evidence to prove proximate cause for each

Plaintiff and Class member. “Three nonexhaustive factors are considered as part of [the proximate

cause] inquiry: ‘(1) whether there are more direct victims of the alleged wrongful conduct who can

be counted on to vindicate the law as private attorneys general; (2) whether it will be difficult to

ascertain the amount of the plaintiff’s damages attributable to defendant’s wrongful conduct; and

(3) whether the courts will have to adopt complicated rules apportioning damages to obviate the

risk of multiple recoveries.’” Id. As this Court found in denying Bosch’s motion to dismiss in this

action, “[e]ach of these factors supports a direct connection between Bosch’s alleged RICO

violation and the Franchise Dealers’ alleged injuries.” Id.

Those three factors will be resolved with common evidence that will yield common

answers. First, common proof will show that “there are no more direct victims of the wrongful

conduct because the Franchise Dealers bought the affected vehicles directly from co-schemer

Volkswagen.” Id. Second, common evidence will demonstrate that “the emissions fraud led

directly to the stop-sale order, which led directly to the Franchise Dealers’ inability to sell their

inventory of ‘clean diesel’ vehicles.” Id. And third, this Court has explained that “there is no reason

to currently conclude that this case will require the Court ‘to adopt complicated rules apportioning

damages to obviate the risk of multiple recoveries.’” Id. at *9 (quoting Mendoza v. Zirkle Fruit

Co., 301 F.3d 1163, 1169 (9th Cir. 2002)). And in any event, deciding whether and how to

apportion damages is a common issue. In short, common evidence will show that “there is a

‘sufficiently direct relationship between the defendant’s wrongful conduct and the plaintiff’s

injury....’” MTD Order, 2017 WL 4890594, at *9 (quoting Bridge v. Phoenix Bond & Indem. Co.,

553 U.S. 639, 657 (2008) (emphasis added by this Court)).

Moreover, as in Bridge, third-party reliance by federal and state regulators on the RICO

fraud presents a common issue to establish all Plaintiffs and Class members suffered RICO injuries

by reason of the RICO violation. See id. at *11 (“The misrepresentation also does not need to be

made to the RICO plaintiff, but instead may be made to a third-party. See Bridge, 553 U.S. at

661….”). As Plaintiffs allege and will prove with evidence common to all Class members “EPA,

CARB, and other regulators relied on the misrepresentations and material omissions made or


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caused to be made by the RICO Defendants; otherwise Volkswagen could not have obtained valid

COCs and EOs to sell the Affected Vehicles.” TAC ¶ 436.

Similarly, in Just Film, Inc. v. Buono, 847 F.3d 1108, 1121 (9th Cir. 2017), the Ninth

Circuit identified third-party reliance as a common issue in affirming class certification. The

plaintiffs alleged that the “pattern of racketeering includes Leasing Defendants’ alleged

misrepresentations to ACH processors,” which debited class members’ accounts in reliance on

those misrepresentations. Id. at 1117. The Ninth Circuit held that the “district court properly

identified several common questions and determined they predominate in Plaintiffs’ RICO claim.

These questions include ... whether ACH processors relied on fraudulent misrepresentations by

Leasing Defendants when they processed the debits.” Id. at 1121. Thus, the Court identified

whether the third-party ACH processors relied on misrepresentations as a common question.

Similarly, the issue of whether state and federal regulators relied on misrepresentations by

Volkswagen and Bosch.

Finally, common issues predominate as to reliance for Plaintiffs’ claim that, in addition to

making misrepresentations to regulators, Bosch failed to disclose material information to dealers

and consumers.69 As the en banc Fifth Circuit has explained, RICO plaintiffs “may use a common

inference of reliance to prove proximate causation under RICO. A jury may reasonably infer that,

in deciding to pay to become IAs, the Plaintiffs relied on Ignite’s ‘implicit representation that it is a

legal multi-level marketing program, when it is in fact a fraudulent pyramid scheme.” Torres v.

S.G.E. Mgmt., L.L.C., 838 F.3d 629, 643 (5th Cir. 2016) (en banc). The court explained that “the

record is devoid of evidence that a single putative class member joined as an IA despite having

knowledge of the fraud. Even after the close of discovery and the commencement of summary

judgment motions before the district court, the Defendants produced no evidence that a single class

69 United States v. Woods, 335 F.3d 993, 998 (9th Cir. 2003) (RICO claim can be based on “the

concealment of material facts”) (citation omitted). See also Flores v. United Parcel Serv., Inc., 2019 WL 1777280, at *1 (9th Cir. Apr. 23, 2019) (failure to disclose can be the basis of a RICO fraudulent scheme if there is a duty to disclose). Any issue as to whether Volkswagen and Bosch had a duty to disclose material information to regulators and Class members presents a common issue.


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member even knew of the fraud or would have paid to become an IA knowing of the fraud.” Id.

And in CGC Holding Co., LLC v. Broad & Cassel, the court similarly explained that “[i]n the

RICO context, class certification is proper when ‘causation can be established through an inference

of reliance where the behavior of plaintiffs and the members of the class cannot be explained in

any way other than reliance upon the defendant’s conduct.’” 773 F.3d 1076, 1089–90 (10th Cir.

2014) (citation omitted).70

Likewise here, Plaintiffs will present common evidence that the behavior of the Franchise

Dealers cannot be explained in any way other than reliance upon the fraudulent conduct of Bosch

and Volkswagen. See TAC ¶ 436 (“Plaintiffs, along with hundreds of franchise dealers, relied upon

RICO Defendants’ representations and omissions that were made or caused by them. Plaintiffs’

reliance is made obvious by the fact that: (1) they purchased hundreds of thousands of vehicles that

never should have been introduced into the U.S. stream of commerce and whose worth has now

plummeted since the scheme was revealed; and (2) they invested millions of dollars in the

continuing operation of their franchise dealerships.”).

70 See also Menocal v. GEO Grp., Inc., 882 F.3d 905, 919 (10th Cir.) (“[W]hen a class member

could individually establish causation based on circumstantial evidence, a court may likewise allow a class to rely on circumstantial evidence that the class shares to establish causation on a class-wide basis. CGC Holding’s reasoning applies with equal force to the facts of this case because (1) a court could permit an individual TVPA class member to establish causation through circumstantial evidence, and (2) the TVPA class members share the relevant evidence in common because their claims are based on allegations of a single, common scheme.”), cert. denied, 139 S. Ct. 143 (2018); In re U.S. FoodService Inc. Pricing Litig., 729 F.3d 108, 119, 120 (2d Cir. 2013) (affirming class certification under RICO because “‘while each plaintiff must prove reliance, he or she may do so through common evidence (that is, through legitimate inferences based on the nature of the alleged misrepresentations at issue)’” and because “the record here contains no such individualized proof indicating knowledge or awareness of the fraud by any plaintiffs”) (quoting Klay v. Humana, Inc., 382 F.3d 1241, 1259 (11th Cir. 2004)) (emphasis in original); Waldrup v. Countrywide Fin. Corp., 2018 WL 799156, at *13 (C.D. Cal. Feb. 6, 2018) (“If every LandSafe appraisal was illegitimate because of defendants’ alleged systematic USPAP violations as plaintiffs allege, it is reasonable to infer that no rational class member would have paid the fees if the illegitimacy of the appraisal process had been disclosed. Accordingly, the Court finds that causation under RICO may be established by class-wide proof such that individual issues of class member reliance on the alleged misrepresentations do not predominate.”) (footnote omitted); Cohen v. Trump, 303 F.R.D. 376, 385 (S.D. Cal. 2014) (“Courts have found that reliance can be established on a class-wide basis [under RICO] where the behavior of plaintiffs and class members cannot be explained in any way other than reliance upon the defendant’s conduct…. The Court finds that [Plaintiff’s] evidence provides a method for Plaintiff to establish proximate causation on a classwide basis without resort to individualized inquiries, by relying on a common sense inference that consumers are likely to rely on prominently marketed features of a product which they purchase.”).


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b. Each merits element of the RICO claim will be proved by predominately common evidence that will yield common answers.

Plaintiffs will establish each merits element of the RICO claim with common evidence. To

prevail on their RICO claim, the Franchise Dealers must prove that Bosch participated, directly or

indirectly, in (1) the conduct, (2) of an enterprise that affects interstate commerce, (3) through a

pattern, (4) of racketeering activity. See MTD Order, 2017 WL 4890594, at *11. Plaintiffs will

address these elements below in reverse order, as this Court did in denying Bosch’s motion to

dismiss. Id.

Plaintiffs will show that they meet the predominance requirement for the same reasons that

the requirement was met for the settlement classes in the MDL litigation. In granting preliminary

approval to the dealers’ settlement with Volkswagen, this Court stated:

This action meets Rule 23(b)(3)’s predominance requirement. Plaintiff alleges Volkswagen engaged in the same fraud in the same manner against all Class Members. Specifically, Plaintiff asserts Volkswagen defrauded Class Members through its use of the defeat device. Should the Court find Volkswagen indeed engaged in the fraud as described, such a finding would affect all Class Members’ claims. Further, Plaintiff alleges all Class Members suffered the same harm from the same cause, specifically, the subsequent stop sale orders and brand damage caused by Volkswagen’s disclosure of the device. As such, the Court finds common questions of law or fact predominate.

Volkswagen “Clean Diesel”, 2016 WL 6091259, at *9. That reasoning applies here.71

(1) Common issues with common answers predominate as to Element 4: Racketeering Activity

All of the racketeering activity will be proved with common evidence. As this Court has

explained, “the Franchise Dealers can satisfy their burden of demonstrating that Bosch engaged in

the predicate acts of mail and wire fraud with allegations that Bosch was (1) a knowing participant

in a scheme to defraud, (2) that Bosch participated in the scheme with the intent to defraud, and (3)

71 If the Court certifies the Class for the RICO claim under § 1964(c), the Class should also be

certified for the RICO claim under § 1964(d). See MTD Order, 2017 WL 4890594, at *17 (“The same allegations that demonstrate Bosch’s participation in the enterprise support the Franchise Dealers’ conspiracy claim. It is plausible that Bosch was aware of the scheme because it exercised near-total control over modifications to the EDC 17. And Bosch’s intent to participate in the scheme is inferable from its alleged willingness to let Volkswagen use the modified EDC17 in its vehicles for years.”).


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that a co-schemer’s acts of mail and wire fraud occurred during Bosch’s participation in the

scheme and were within the scope of the scheme.” MTD Order, 2017 WL 4890594, at *13. In

denying Bosch’s motion to dismiss the Second Amended Complaint in this matter, this Court held

that Plaintiffs adequately alleged that Bosch was a knowing participant in the scheme, “because the

Franchise Dealers plausibly alleges that Bosch controlled all modifications to the EDC17, the

Franchise Dealers’ complaint supports an inference that Bosch must have known about and

approved the changes that converted the EDC17 into a defeat device.” Id. In reaching that

conclusion, this Court cited only class-wide allegations in the complaint. See id. at *13–15.

Plaintiffs now have more than allegations to prove on a classwide basis that Bosch was a knowing

participant in a scheme to defraud. See e.g., infra § II B-D outlining Bosch’s knowing participation

in calibrating “cycle beating” software and removing description of the software’s function.

As to “intent to defraud,” this Court then explained that “Bosch’s intent to defraud

reasonably can be inferred from the scheme itself…. No one to date in this multidistrict litigation

has sought to justify, or explain a lawful purpose for, software that effectively turns a vehicle’s

emission systems on or off depending on whether the vehicle is undergoing emissions testing or

being operated under normal driving conditions.” MTD Order, 2017 WL 4890594, at *15.

Documents provided to date show “that is the function for which Bosch allowed its EDC17 to be

used for years in Volkswagen’s vehicles.” Id. But plaintiffs now have more than an inference,

plaintiffs will introduce evidence that Bosch intended to defraud. See infra § II B-D. And Plaintiffs

will use common evidence to prove Volkswagen’s acts of mail and wire fraud “occurred during

Bosch’s participation in the scheme and were within the scope of the scheme so as to support co-

schemer liability. United States v. Stapleton, 293 F.3d 1111, 1117-18 (9th Cir. 2002).

(2) Common issues and answers predominate as to Element 3: A Pattern of Racketeering Activity

Plaintiffs will rely solely on common evidence to prove a pattern of racketeering activity. In

denying Bosch’s motion to dismiss the Second Amended Complaint, this Court stated that the

“predicate acts here were not isolated or sporadic: the Franchise Dealers allege that Volkswagen

misrepresented the emission levels of multiple vehicle models over the course of a decade. Bosch


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does not contend otherwise.” MTD Order, 2017 WL 4890594, at *16. Proof of the pattern

necessarily will rest on common evidence that yields common answers for all Plaintiffs and Class

members. As outlined in the common facts section, Bosch and Volkswagen acted with a common

purpose in utilizing “cycle beating software” and disguising the same, and did so over a period of

nine years with multiple acts of mail and wire fraud. See § II B-D.

(3) Common issues and answers predominate as to Element 2: An Enterprise that Affects Interstate Commerce

Yet again, only common evidence will be produced to prove the existence of a RICO

enterprise. In denying Bosch’s motion to dismiss the RICO claim, this Court noted that the

“Franchise Dealers allege that Bosch and Volkswagen were part of an associated-in-fact enterprise.

See 18 U.S.C. § 1961(4). Such an enterprise has three elements: (1) a common purpose, (2) a

structure or organization, and (3) longevity necessary to accomplish the purpose. Boyle v. United

States, 556 U.S. 938, 946 (2009). Each element is satisfied here.” MTD Order, 2017 WL 4890594,

at *16. Proving all three of those elements requires common evidence only, and there is little

question common evidence exists that Bosch and VW had a common purpose in using cycle

beating software and in disguising its purpose.

(4) Common issues and answers predominate as to Element 1: Conducting the Affairs of the Enterprise

Common evidence only will be used to prove Bosch had a role in conducting the

enterprise’s affairs. In denying Bosch’s motion to dismiss, this Court stated that, “[i]n their 2005

agreement, Bosch and Volkswagen agreed that Bosch’s approval would be required before any

Volkswagen modules could be implemented in the EDC17. Through this approval right, Bosch had

the final say as to whether to implement the defeat device. Bosch’s final-approval right made it

‘indispensable to achievement of the enterprise’s goals,’ and provided it with a position in the

‘chain of command’ of the enterprise, both factors that support an inference that it had a role in

conducting the enterprise’s affairs. Walter, 538 F.3d at 1249.” MTD Order, 2017 WL 4890594, at

*17 (citation omitted). Discovery has amply confirmed Bosch’s implementation of the defeat


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device scheme.72 As a further example of its role in the enterprise, Bosch confirmed its willingness

to implement the scheme when in November 2014, Bosch employees discussed usage of the

acoustic function with felon Oliver Schmidt.

73 Elsewhere in the email chain a VW employee with responsibility for the acoustic

function notes the “ ”74 Bosch’s participation is further

evidenced when Bosch’s sent a “High” importance email with the subject being

,”75 noting “

?” The cover-up of the documentation was requested by VW’s

6 Bosch notified VW .”77 There is little

question that common proof can be used to prove Bosch helped conduct the affairs of the

enterprise.

2. Plaintiffs provide a common methodology of proving class-wide impact and damages for both RICO and conspiracy claims.

At class certification, Plaintiffs “must be able to show that their damages stemmed from the

defendant’s actions that created the legal liability,” and can be measured on a class-wide basis.78

The existence of individualized damage issues does not defeat predominance when damages can be

modeled based on a measure of common proof.79 And, Plaintiffs need not show that each class

member’s damages are identical. Just Film v. Buono, 847 F.3d at 1120. Plaintiffs satisfy this

requirement through the expert report of Mr. Ted Stockton, which provides a common method of

72 See supra Part II B-D. 73 Ex. 23, at 2 (emphasis added). 74 Id. at 1. 75 Ex. 31. 76 Ex. 28. 77 Id. 78 Leyva v. Medline Indus. Inc., 716 F.3d 510, 514 (9th Cir. 2013). 79 Id.


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proving injury to business and property and a common method of calculating the Class members’

damages under both their RICO claim and their state-law conspiracy claims.

Mr. Stockton is an expert in the economics of the automobile market in the United States.

For over 20 years he has researched various aspect of this market, and provided reports, consulting

services and litigation assistance, to franchised dealers, manufacturers and consumers, both directly

and through their counsel in litigation. Mr. Stockton has provided damages-related testimony in

over 120 litigated matters between franchise dealers and manufacturers and in over a dozen

automotive consumer class actions.80 On multiple occasions he has written reports relating to the

economic impact of the discontinuation of brands and product lines including Mercury, Suzuki,

Mini, Oldsmobile, Ford Heavy Truck, Sterling Truck, and the transfer of the Sprinter brand from

Freightliner to Dodge. Mr. Stockton’s work was submitted to this Court in six declarations (absent

any protest by defendants) in support of: (1) Volkswagen’s and Bosch’s settlement in the consumer

cases;81 and (2) Volkswagen’s settlement of its liability in this case.82 Mr. Stockton’s work was

also submitted in support of all four consumer class cases to resolve the diesel emissions litigation

in Canada.83 Without objection from Bosch, Judge Chen relied on Mr. Stockton’s damages work in

support of Bosch and Fiat-Chrysler’s settlement of claims against them for the installation of defeat

devices in certain FCA EcoDiesel vehicles.84 Mr. Stockton co-authored “Franchise and Dealership

Litigation Damages” in The Comprehensive Guide to Economic Damages and has presented on

multiple occasions to automotive accounting groups and government agencies.85

The Court held “Franchise Dealers have plausibly alleged multiple tangible injuries to their

business and property interests[,]” and the Court has explained what harms suffered by the

80 See Stockton Report at Tab 1. 81 ECF Nos. 1784-1, 1976-4, 2786-2, 3088-1, and 3396-3. 82 ECF No. 2485. 83 See ECF No. 3088-1, n. 2. 84 In re: Chrysler-Dodge-Jeep Ecodiesel® Marketing, Sales Practices, and Products Liability

Litigation, No. 3:17-md-02777-EMC, ECF No. 491-3. 85 See Stockton Report at Tab 1.


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Franchise Dealers are recoverable under RICO, and which are not.86 The precise underpinnings of

Mr. Stockton’s damages model are drawn from the MTD Order. The Court held: “The stop-sale

order has prevented the Franchise Dealers from selling their inventory of affected vehicles….the

Franchise Dealers plausibly allege that they have lost profits, have incurred inventory carrying

costs, have had to purchase replacement inventory, and have lost servicing revenues from the

vehicles they could not legally sell.” Id. at *6 (emphasis in original).

Tracing the MTD Order, Mr. Stockton’s “profit contribution” model captures the Franchise

Dealers’ lost profits from these components. The class-wide model uses the sales and profit

structures of retail automotive dealerships to estimate the degree to which a change to the inputs to

that structure, the permanent loss of the TDI portion of the franchise and the removal of buyback

TDI vehicles from the market, affects the profit output from that structure. The stop-sale orders and

termination of TDI models permanently ended the Franchise Dealers sales of new TDIs. Mr.

Stockton’s model measures the lost profits from never again being able to sell new TDIs and the

lost profits from not selling the cars that would have been taken in on trade for those TDIs.87 And it

measures lost profits from the lost servicing revenue as a result of not selling new TDIs.

Separately, it also measures the lost profits from the lost servicing revenues as a result of the

buyback removing nearly 400,000 in-use vehicles from the U.S. market.88

Also directly tracing the MTD Order, Mr. Stockton’s model is able to incorporate the

“offsets to certain injuries, such as if the Franchise Dealers paid for alternative inventory but then

successfully sold that inventory for a profit, or if independent market forces caused a drop in

profits or a decline in the value of the affected vehicles.”89 For example, the model adjusts

forecasted TDI sales for the changes in competitive registrations, which is a widely accepted

industry method for evaluating independent market forces.90 Other possible mitigation, for

86 MTD Order, 2017 WL 4890594, at *8; see id. at *4-8. 87 See Stockton Report at pp. 18-36. 88 See id. 89 MTD Order, 2017 WL 4890594, at *6. 90 See Stockton Report at pp. 18-19.


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example, if data shows that customers shifted their buying to gasoline-powered cars when

Volkswagen terminated its diesel offerings, can be incorporated by Mr. Stockton’s model, should

evidence in the case warrant that adjustment.91

Critically, to estimate damages under the RICO claim, the model completely removes

damages flowing from the loss of goodwill, which the Court determined is not recoverable under

RICO.92 The Court defined goodwill as “‘the positive reputation a business may enjoy in the eyes

of the public that creates a probability that old customers will continue their patronage.’”93 Taking

an example from the Complaint, the Court further defined loss of goodwill as ‘“loss of sales

associated with replacement vehicles for existing customers.’”94 Mr. Stockton’s model is able to

exclude the goodwill portion of lost profits from the damages estimate. The vehicle industry has

long established metrics for the share of new sales that result from returning customers.95 By

reducing sales by that returning customer share (which for VW was 37%), the model removes

goodwill damages since every sale to a returning customer is excluded from the measure of lost

profits. Because the lost new sales figure after removing goodwill sales is used to determine

associated lost profits from lost used car sales and lost profits from not servicing lost new and used

sales, lost profits associated with goodwill are entirely removed from each component of the model.

The model can also easily incorporate offsets to lost profits, such as the dealer support

payments made by Volkswagen immediately following the issuance of the NOVs, financing

assistance, as well as changes to Volkswagen’s volume-based pricing scheme that increased the

amount of rebates received by the Franchise Dealers in connection with new car sales. As a result,

Plaintiffs are able to model their damages on a class-wide basis, capturing their lost profits as a

result of the alleged RICO violation after possible mitigation and exclusive of “goodwill damages”

that the Court has determined are not recoverable under RICO. Per the MTD Order, under RICO,

91 See id. at pp. 31-34. 92 See MTD Order, 2017 WL 4890594, at *6-7. 93 See id. 94 See id. 95 See Stockton Report at pp. 15-16.


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these singles damages are then subject to mandatory trebling, after which Volkswagen’s settlement

payments to the Class are applied.

In its recent motion to dismiss claims for relief brought by Volkswagen salespeople against

Volkswagen and Bosch,96 and its just-filed Lone Pine motion here (ECF No. 6359), Bosch

advances an extreme and unsupportable interpretation of permissible RICO damages and the MTD

Order. Bosch argues that the Court held the Franchise Dealers can only recover RICO damages for

the lost sales of cars in inventory at the time of the stop-sale orders, and all future lost sales are

non-recoverable goodwill damages.97 The MTD Order does not support this extraordinary

reading.98 Likewise, the cases Bosch cites are unavailing because they concern losses stemming

from future, uncertain events.99 Here, in stark contrast, the Franchise Dealers’ lost profits stem

from the stop-sale and permanent cessation of VW’s TDI models, both of which have already

occurred immediately following and as a result of exposure of the RICO conspiracy.

But importantly for this motion, the extent to which the Franchise Dealers can recover

RICO future lost profits (net of goodwill) from termination of the TDI product line is

unquestionably a class-wide issue. It does not depend on the characteristics or circumstance of any

particular Dealer, it is the quintessential question of law that could only be determined for the

Franchise Dealer Class as a whole after class certification has been granted.

96 Saavedra, et al. v. Volkswagen et al., No. 3:15-md-2672-CRB, Dkt. No. 6333, at pp. 4-6. 97 See id. 98 The MTD Order clearly states that only returning customers’ future purchases are non-

recoverable goodwill sales, yet Bosch argues, ipse dixit, that the Court meant to say all future sales of TDI vehicles are non-recoverable goodwill. To borrow from Abraham Lincoln, “calling a tail a leg does not make it a leg.” Bosch already argued in its Motion to Dismiss that all damages are goodwill—and lost. The Court made clear that goodwill sales were limited to returning customers (“…Franchise Dealers’ claims of lost profits is not predicated solely on a loss of sales to former customers…”). MTD Order, 2017 WL 4890594, at *7. Further, Bosch’s fallacious argument that the Franchise Dealers have no damages completely ignores the buy-back of over 400,000 TDIs, which removed those cars from the population of in-use vehicles that the Franchise Dealers serviced. The lost profits from lost servicing revenue was specifically identified by the Court as recoverable and it has nothing to do with TDI sales following the stop-sale orders (returning goodwill customers or new ones). See id.

99 See, e.g, In Re Duramax Diesel Litig., 298 F. Supp. 3d 1037, 1070-72 (E.D. Mich. 2018) (distinguishing unrecoverable future losses from contingent or future events from recoverable losses from events that have already occurred).


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D. Plaintiffs’ state-law civil conspiracy claims raise predominately common issues with common answers.

Under the laws of all 50 states, Plaintiffs allege that Volkswagen and Bosch entered into a

civil conspiracy to defraud Plaintiffs and all Class members. The Ninth Circuit has explained that

“this [C]ourt has followed an approach that favors class treatment of fraud claims stemming from a

‘common course of conduct.’ See Blackie v. Barrack, 524 F.2d 891, 902 (9th Cir. 1975)….” In re

First Alliance Mortg. Co., 471 F.3d 977, 990 (9th Cir. 2006). As shown below, class treatment of

the civil-conspiracy claims is appropriate.

1. Applicable legal standards.

Three legal principles underlie Plaintiffs’ motion to certify the Class for civil-conspiracy

claims under the laws of all 50 states. First, Plaintiffs have standing to seek certification of those

claims for all Class members. In Kirola v. City and County of San Francisco, 860 F.3d 1164, 1176

(9th Cir. 2017), the Court explained that a “panel of our court recently clarified the relationship

between Article III and class certification. See Melendres v. Arpaio, 784 F.3d 1254, 1262 (9th Cir.

2015). Adopting the ‘class certification approach,’ the panel in Melendres held that ‘once the

named plaintiff demonstrates her individual standing to bring a claim, the standing inquiry is

concluded, and the court proceeds to consider whether the Rule 23(a) prerequisites for class

certification have been met.’ Id. (quoting 1 William B. Rubenstein, Newberg on Class Actions §

2:6 (5th ed.)).” The same “class certification approach” applies when a plaintiff brings state-law

claims on behalf of putative class members who live in states other than the plaintiff’s home state.

See Kutza v. Williams-Sonoma, Inc., 2018 WL 5886611, at *3 (N.D. Cal. Nov. 9, 2018); Robinson

v. Unilever United States, 2018 WL 6136139, at *4 (C.D. Cal. June 25, 2018); Pecanha v. The

Hain Celestial Grp., Inc., 2018 WL 534299, at *9 (N.D. Cal. Jan. 24, 2018); In re Chrysler-Dodge-

Jeep EcoDiesel Mktg., Sales Practices, & Prods. Liab. Litig., 295 F. Supp. 3d 927, 955 (N.D. Cal.

2018).100

100 This is particularly true because Plaintiffs do not bring only state-law claims. See Kutza,

2018 WL 5886611, at *3 (“This is not an instance where a California plaintiff seeks to represent residents of other states under a plethora of state consumer statutes with potentially differing


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Second, the relevant laws of all 50 states are sufficiently similar to allow certification of the

Class. The issue is whether in this case—where Plaintiffs and Class members had no knowledge

that the Volkswagen vehicles contained defeat devices and where they were defrauded by common

omissions, not individual representations—variations in state law preclude class certification. And

as shown below, any differences in state laws can be handled by special interrogatories or special

verdict forms. See In re Chrysler-Dodge-Jeep EcoDiesel Mktg., Sales Practices, & Prods. Liab.

Litig., 2019 WL 536661, at *7 (N.D. Cal. Feb. 11, 2019) (“while there are some variations in state

law, Plaintiffs have made at least a fair argument (in their class certification briefing) that such

variations are not so extensive or complicated that they defeat predominance”); Spencer v.

Hartford Fin. Servs. Grp., Inc., 256 F.R.D. 284, 301 (D. Conn. 2009) (“Plaintiffs have adequately

demonstrated that the elements of fraud are substantially similar from state to state.... With regard

to the differing standards of proof and other requirements pointed out by the defendants, the court

agrees with plaintiffs that, because the underlying factual proof is the same, these differences could

be adequately addressed with a verdict form and do not defeat predominance.”).

2. Civil conspiracy will be proved with common evidence and common legal standards.

The elements of a civil conspiracy under the laws of all 50 states do not materially vary.

First, they do not materially vary under the laws of the Plaintiffs’ states. In California, the elements

are: (1) the formation and operation of the conspiracy, (2) wrongful conduct in furtherance of the

conspiracy, and (3) damages arising from the wrongful conduct. Ponomarenko v. Shapiro, 287 F.

Supp. 3d 816, 831 (N.D. Cal. 2018). In Florida, the elements are: (1) an agreement between two or

more parties, (2) to do an unlawful act or to do a lawful act by unlawful means, (3) the doing of

some overt act in pursuance of the conspiracy, and (4) damage to plaintiff as a result of the acts

done under the conspiracy. MP, LLC v. Sterling Holding, LLC, 231 So. 3d 517, 521–522 (Fla. Dist.

Ct. App. 2017). And in Pennsylvania, the elements are: (1) a combination of two or more persons

acting with a common purpose to do an unlawful act or to do a lawful act by unlawful means or for

procedural and substantive requirements, and scopes. Rather, the claims are brought under a federal statute, and the common law, which likely will not vary much among the states.”).


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an unlawful purpose; (2) an overt act done in pursuance of the common purpose; and (3) actual

legal damage. Gen. Refractories v. Fireman’s Fund Ins. Co., 337 F.3d 297, 313 (3d Cir. 2003);

Downs v. Borough of Jenkintown, 2019 WL 1383802, at *8 (E.D. Pa. Mar. 26, 2019).

Second, there are no material differences in the elements of a civil conspiracy claim under

the laws of the other 47 states. See Appendix 1. Moreover, Plaintiffs will use common, class-wide

evidence to establish the existence of a civil conspiracy under the laws of all states, using the same

evidence that they will use to establish a RICO enterprise.

3. Common-law fraud will be proved with common facts based on common legal standards.

Plaintiffs’ civil-conspiracy claims require proof of an underlying tort, which Plaintiffs will

prove with common evidence. The underlying torts are (1) common-law fraud by active

concealment of material facts and (2) common-law fraud by nondisclosure. In United States v.

Colton, 231 F.3d 890, 899 (4th Cir. 2000), the Fourth Circuit explained the difference between

those two legal theories:

[T]he common law clearly distinguishes between concealment and nondisclosure. The former is characterized by deceptive acts or contrivances intended to hide information, mislead, avoid suspicion, or prevent further inquiry into a material matter. The latter is characterized by mere silence. Although silence as to a material fact (nondisclosure), without an independent disclosure duty, usually does not give rise to an action for fraud, suppression of the truth with the intent to deceive (concealment) does.

Accord, In re Chrysler-Jeep-Dodge EcoDiesel, 295 F. Supp. 3d at 1008 (“[A]n affirmative act of

concealment by the defendant effectively negates the duty-to-disclose requirement (i.e., there is a

difference between silence, where a duty to disclose is required, and active concealment, where

there is no such requirement).”).101

With respect to the Franchise Dealers’ damages under their conspiracy claims, the Stockton

Model provides an accurate and reliable methodology. It differs from the RICO model only in the

101 The California and Florida plaintiffs must prove their fraud claims by a preponderance of

the evidence, while the Pennsylvania plaintiff must prove its fraud claims by clear and convincing evidence. See Appendix 3. As a result, they will adequately represent all Class members, because all states require proof of fraud by a preponderance of the evidence or by clear and convincing evidence. See id.


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extent to which lost profits stemming from goodwill sales to returning customers are excluded from

singles damages. The conspiracy damages are not subject to mandatory trebling, but in certain

states exemplary damages are available. These variations do not hinder the ability of the Franchise

Dealers to prove class-wide damages attributable to Bosch’s acts in furtherance of the alleged

conspiracy.

a. Plaintiffs’ active-concealment fraud claim will be proved with common evidence based on common legal standards.

Under the laws of all 50 states, active concealment of a material fact is actionable without

proof of a duty to disclose. See Appendix 2. And the elements of an active-concealment claim do

not materially vary from state to state. For example, the elements of an active-concealment claim

under California law are: (1) concealment or suppression of a material fact by a defendant; (2) the

defendant intended to defraud the plaintiff by intentionally and actively concealing or suppressing

the fact; (3) the plaintiff was unaware of the fact and would not have acted as he or she did if he or

she had known of the concealed or suppressed fact; and (4) plaintiff sustained damage as a result of

the concealment or suppression of the fact.102 Similarly, the elements in Florida are that: (1) the

defendant actively concealed a material fact; (2) the defendant knew or should have known the

material fact should be disclosed; (3) the defendant knew that its active concealment of the material

fact would induce the plaintiff to act; and (4) the plaintiff detrimentally relied on the

misinformation.103 And the elements under Pennsylvania law are: (1) Actively concealing from

another a fact that Defendant knows may justifiably induce the other to act or refrain from acting in

a business transaction; (2) which is material to the transaction at hand; (3) with the intent of

misleading another into relying on it; (4) justifiable reliance; and (5) the resulting injury was

proximately caused by the reliance.104

102 Dent v. NFL, 902 F.3d 1109, 1125 (9th Cir. 2018); Hodson v. Mars, Inc., 891 F.3d 857, 862

(9th Cir. 2018). 103 Hess v. Philip Morris USA, Inc., 175 So. 3d 687, 691 (Fla. 2015); Cote v. R.J. Reynolds

Tobacco Co., 909 F.3d 1094, 1106 n.6 (11th Cir. 2018); Joiner v. McCullers, 28 So. 2d 823, 825 (Fla. 1947); Philip Morris USA, Inc. v. Duignan, 243 So. 3d 426, 440 (Fla. Dist. Ct. App. 2017).

104 LEM 2Q, LLC v. Guar. Nat’l Title Co., 144 A.3d 174, 181 & n.11 (2016) (Pa. Super. Ct. 2016) (citing Restatement (Second) of Torts § 551); Youndt v. First Nat’l Bank of Port Allegany, 868 A.2d 539, 550 (Pa. Super. Ct. 2005) (citing Restatement (Second) of Torts § 551); Gnagey Gas


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There are no material differences in the elements of an active-concealment claim under the

laws of the other 47 states. See Appendix 2. And Plaintiffs will use common, class-wide evidence

to establish active concealment under the laws of all states

b. Plaintiffs’ fraud claim based on nondisclosure will be proved with common evidence based on common legal standards.

(1) The elements of a fraudulent nondisclosure claim are common.

The elements of a fraudulent nondisclosure claim do not materially vary from state to state.

The elements of a nondisclosure claim under California law are: (1) concealment or suppression of

a material fact; (2) by a defendant with a duty to disclose the fact to the plaintiff; (3) the defendant

intended to defraud the plaintiff by intentionally concealing or suppressing the fact; (4) the plaintiff

was unaware of the fact and would not have acted as he or she did if he or she had known of the

concealed or suppressed fact; and (5) plaintiff sustained damage as a result of the concealment or

suppression of the fact. Dent, 902 F.3d at 1125. The elements of such a claim under Florida law

are: (1) the defendant concealed or failed to disclose a material fact; (2) the defendant knew or

should have known the material fact should be disclosed; (3) the defendant knew that its

concealment of or failure to disclose the material fact would induce the plaintiff to act; (4) the

defendant had a duty to disclose the material fact; and (5) the plaintiff detrimentally relied on the

misinformation. Hess, 175 So. 3d at 691; Cote, 909 F.3d at 1106 n.6. And in Pennsylvania, the

elements are: (1) failure to disclose material facts (2) that defendant knows may justifiably induce

the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s

reliance upon these falsely omitted material facts, (4) when under a duty to the other to exercise

reasonable care to disclose the matter in question; (5) justifiable reliance; and (6) the resulting

injury was proximately caused by the reliance. LEM 2Q, LLC, 144 A.3d at 181 & n.11 (citing

& Oil Co. v. Pa. Underground Storage Tank Indemnification Fund, 82 A.3d 485, 501 (Pa. Commw. Ct. 2013); Rissmiller v. NGK N. Am., Inc., 2018 WL 4203839, at *3 (E.D. Pa. Sept. 4, 2018); In re Gen. Motors LLC Ignition Switch Litig., 257 F. Supp. 3d 372, 442–43 (S.D.N.Y. 2017); Aetna, Inc. v. Health Diagnostic Lab. Inc., 2015 WL 9460072, at *4 (E.D. Pa. Dec. 28, 2015).


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Restatement (Second) of Torts § 551); Youndt, 868 A.2d at 550 (citing Restatement (Second) of

Torts § 551).

There are no material differences in the elements of a nondisclosure claim under the laws of

the other states. See Appendix 4. Moreover, Plaintiffs will use common, class-wide evidence to

establish nondisclosure under the laws of all states

(2) A duty to disclose will established with common evidence, based on common standards.

All states apply a few common standards for proof of a duty to disclose, presenting

common issues. Under California law, a defendant has a duty to disclose in two circumstances

relevant to this case: (1) when the defendant has superior knowledge of a material defect that is

central to the functioning of a product and that is not known or reasonably accessible to the

plaintiff; and (2) when the defendant makes partial representations that are misleading because

some other material fact has not been disclosed. Hodson, 891 F.3d at 862. See Norcia v. Samsung

Telecomms. Am., LLC, 2018 WL 4772302, at *2 (N.D. Cal. Oct. 1, 2018) (“No reasonable person

could disagree that ‘speed and performance’ go to the heart of a smartphone’s central function.

Manufacturers like Samsung and its competitors typically highlight speed and performance

features as reasons to buy their phones and not someone else’s products, particularly when new

models hit the market… That manipulation was a material fact not known to plaintiff and, as

alleged, was within the exclusive knowledge of Samsung. Plaintiff has adequately alleged an

omission of a fact that Samsung was obliged to disclose, a conclusion strongly supported by our

circuit’s guidance in Hodson.”).

Similarly under Florida law, there is a duty to disclose based on superior knowledge105 and

partial, misleading disclosures.106 And in Pennsylvania, there is a duty to disclose based on the

105 Hauben v. Harmon, 605 F.2d 920, 924 (5th Cir. 1979) (“an affirmative duty to disclose

exists in Florida” where “the facts are solely within the knowledge of the representor”); Coffey v. WCW & Air, Inc., 2018 WL 4154256, at *4 (N.D. Fla. Aug. 30, 2018) (“The Florida Supreme Court has long held that a seller has a duty to disclose material information that is ‘not equally within the ken of the buyer.’”) (quoting Kitchen v. Long, L.R.A., 64 So. 429, 430 (Fla. 1914)).

106 Cafaro v. Zois, 693 F. App’x 810, 816 (11th Cir. 2017) (A duty to disclose “exists if a defendant ‘undert[akes] to disclose material information’ but fails ‘to disclose that information fully.’ See Philip Morris USA, Inc. v. Naugle, 103 So. 3d 944, 946 (Fla. Dist. Ct. App. 2012) (per


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standards of the Restatement (Second) of Torts § 551.107 Section 551(2) states, in relevant part, that

a party to a business transaction is under a duty to exercise reasonable care to disclose “(b) matters

known to him that he knows to be necessary to prevent his partial or ambiguous statement of the

facts from being misleading; and … (e) facts basic to the transaction, if he knows that the other is

about to enter into it under a mistake as to them, and that the other, because of the relationship

between them, the customs of the trade or other objective circumstances, would reasonably expect

a disclosure of those facts.” All of the other states use some or all of the same standards. See

Appendix 4.

Moreover, the evidentiary proof of duty to disclose under those standards will be common

to all Class members and will yield common answers. Further, the factual proof of what should

have been disclosed is common to the Class members. In re Volkswagen “Clean Diesel” Mktg.,

Sales Practices, & Prods. Liab. Litig., 349 F. Supp. 3d 881, 915 (N.D. Cal. 2018) (Plaintiffs allege

“what VW failed to disclose: (1) that ‘the Clean Diesel engine systems were not EPA-compliant,’

and (2) that the class vehicles ‘used software that caused the vehicles to operate in low-emission

test mode during emissions testing’”) (quoting complaint). See also In re Mercedes-Benz Emissions

Litig., 2019 WL 413541, at *22 (D.N.J. Feb. 1, 2019) (“In none of [its nationwide marketing

efforts to promote its BlueTEC clean diesel vehicles] does Mercedes disclose that the purported

benefits of the BlueTEC engine could only be achieved through or were completely obscured by

the use of a defeat device. These allegations are sufficient to establish partial disclosures that

Mercedes had an obligation to make true.”); In re Duramax Diesel Litig., 298 F. Supp. 3d at 1084

(“The nondisclosure of the true operation of the Duramax engine was material precisely because

GM worked so hard to convince consumers that it was a ‘clean diesel’ engine.”).

curiam.”)); ZC Ins. Co. v. Brooks, 847 So. 2d 547, 551 (Fla. Dist. Ct. App. 2003) (“Florida law recognizes that fraud can occur by omission, and places a duty on one who undertakes to disclose material information to disclose that information fully.”).

107 See LEM 2Q, LLC, 144 A.3d at 181 & n.11; Youndt, 868 A.2d at 545; Hamilton v. Speight, 2019 WL 161731, at *2 (E.D. Pa. Jan. 10, 2019); Boardakan Rest. LLC v. Gordon Grp. Holdings, LLC, 2015 WL 4597970, at *1 n.4 (E.D. Pa. July 31, 2015); United Nat’l Ins. Co. v. Aon Ltd., 2008 WL 3819865, at *6 (E.D. Pa. Aug. 8, 2008).


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c. Compensatory damages will be proved with common evidence.

Compensatory damages will be proved by common evidence under common legal

standards. In California, “[o]ne defrauded in the purchase, sale or exchange of property is entitled

to recover the difference between the actual value of that with which the defrauded person parted

and the actual value of that which he received, together with any additional damage arising from

the particular transaction….” See Alliance Mortg. Co. v. Rothwell, 10 Cal. 4th 1226, 1241 n.5

(1995) (“section 3343 does not require that a plaintiff show ‘out-of-pocket’ loss in order to be

entitled to consequential or additional damages of the type prescribed by the statute”). In Florida

fraud plaintiffs may recover benefit-of-the bargain damages or out-of-pocket damages, whichever

will more fully compensate plaintiff. Hollister Inc. v. Zassi Holdings, Inc., 752 F. App’x 888, 893

(11th Cir. 2018). And under Pennsylvania law, fraud plaintiffs may recover out-of-pocket damages,

plus damages that were the proximate result of the fraud. Scaife Co. v. Rockwell-Standard Corp.,

285 A.2d 451, 457 (Pa. 1971); Silverman v. Bell Sav. & Loan Ass’n, 533 A.2d 110, 116 (Pa. Super.

Ct. 1987); Edward J. DeBartolo Corp. v. Coopers & Lybrand, 928 F. Supp. 557, 566 (W.D. Pa.

June 11, 1996).

All states allow damages for fraud under the benefit-of-the-bargain or out-of-pocket

standards (or both), along with proximately-caused consequential damages. See Appendix 5. As the

Stockton Report makes clear, the Franchise Dealers were directly harmed as a result of the VW-

Bosch-IAV conspiracy.108 Proof and quantification of this harm is not dependent on the individual

characteristics of any particular dealership. Instead, it flows from class-wide evidence, such as the

number of new TDI sales that never occurred because of the product line termination, and the

amount of servicing that was never done because of those lost sales and because the buyback

removed nearly 400,000 TDIs from the market.109

E. A class action for the RICO and civil-conspiracy claims is superior to any other method for adjudicating the controversy.

To meet Rule 23(b)(3)’s superiority requirement, Plaintiffs must show “that a class action is

108 See Stockton Report at pp. 10-18. 109 See id.


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superior to other available methods for fairly and efficiently adjudicating the controversy.” A court

must consider Rule 23(b)(3)’s four factors.110 In granting preliminary approval to the Franchise

Dealers’ settlement with Volkswagen, this Court stated:

The superiority test is also satisfied. This test “requires the court to determine whether maintenance of this litigation as a class action is efficient and whether it is fair.” Wolin, 617 F.3d at 1175-76. If Class Members were to litigate their claims independently, each one would be required to prove the same wrongful conduct to establish liability and would offer the same evidence. There are 652 Class Members and thus the potential for just as many lawsuits. This risks the possibility of inconsistent rulings and results. Classwide resolution is clearly favorable compared to other means of adjudication, and the Settlement resolves Class Members’ claims at once. Thus, class action treatment is superior to other methods and will efficiently and fairly provide a resolution to this litigation.

Volkswagen “Clean Diesel”, 2016 WL 6091259, at *9. The same analysis applies here. See also In

re Volkswagen “Clean Diesel” Mktg., Sales Practices & Prods. Liab. Litig., 2017 WL 672820, at

*8 (N.D. Cal. Feb. 16, 2017) (finding superiority for certification of class for purposes of

settlement by Bosch and consumers).

IV. CONCLUSION

This is the quintessential case for class certification. Proving Bosch’s liability to Plaintiffs

and the Class under their RICO and conspiracy claims will require only class-wide evidence. Trial

of Bosch’s liability should be done for all 652 Class members at the same time. The harm from the

alleged misconduct is also uniquely class-wide. Both in terms of all sales in the present and future

(due to the stop sale orders and termination of TDI product lines), and in terms of virtually all

servicing (as a result of the buy-back) an entire product line was wiped out for the entire VW

market. The Stockton Report plainly presents a viable model for class-wide damages that measures

damages directly flowing from the conspiracy. Plaintiffs’ motion should be granted.

110 The factors are: “(A) the class members’ interests in individually controlling the prosecution

or defense of separate actions; (B) the extent and nature of any litigation concerning the controversy already begun by or against class members; (C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and (D) the likely difficulties in managing a class action.” Fed. R. Civ. P. 23(b)(3)(A–D).


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DATED: June 14, 2019 Respectfully submitted,

HAGENS BERMAN SOBOL SHAPIRO LLP

By: /s/ Steve W. Berman Steve W. Berman (Pro Hac Vice)

Thomas E. Loeser (SBN 202724) 1301 Second Avenue, Suite 2000 Seattle, WA 98101 Telephone: (206) 623-7292 Facsimile: (206) 623-0594 [email protected] [email protected] Richard N. Sox (Pro Hac Vice) BASS SOX MERCER 2822 Remington Green Circle Tallahassee, FL 32308 Telephone: (850) 878-6404 Facsimile: (850) 942-4869 [email protected] Counsel for Plaintiffs and the Franchise Dealer Class


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CERTIFICATE OF SERVICE

I hereby certify that on June 14, 2019, I electronically transmitted the foregoing document

to the Court Clerk using the ECF System for filing. The Clerk of the Court will transmit a Notice of

Electronic Filing to all ECF registrants.

/s/ Steve W. Berman STEVE W. BERMAN


APPENDIX 1

Case 3:15-md-02672-CRB Document 6387-1 Filed 06/14/19 Page 1 of 7

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State-law elements of civil conspiracy

State Elements of civil conspiracy Alabama (1) Concerted action by two or more persons (2) to achieve an unlawful

purpose or a lawful purpose by unlawful means. Ex parte Maint. Grp., Inc., 261 So. 3d 337, 347 (Ala. 2017).

Alaska (1) Two or more persons; (2) an object to be accomplished; (3) a meeting of the minds on the object or course of action; (4) one or more unlawful overt acts; and (5) damages as a result of the overt act or acts. Davis v. King Craig Trust, 2017 WL 2209879, at *3 n.12 (Alaska 2017) (adopting elements stated in Morasch v. Hood, 222 P.3d 1125, 1131–1132 (Or. App. 2009)).

Arizona (1) Two or more people (2) agree to accomplish an unlawful purpose or to accomplish a lawful object by unlawful means, (3) causing damages. Wells Fargo Bank v. Ariz. Laborers, Teamsters & Cement Masons Local No. 935 Pension Trust Fund, 38 P.3d 12, 37 (Ariz. 2002).

Arkansas (1) A combination of two or more persons (2) to accomplish a purpose that is unlawful or oppressive or to accomplish some purpose, not in itself unlawful, oppressive or immoral, by unlawful, oppressive or immoral means, (3) to the injury of another. Chambers v. Stern, 64 S.W.3d 737, 404 (Ark. 2002).

California (1) The formation and operation of the conspiracy, (2) wrongful conduct in furtherance of the conspiracy, and (3) damages arising from the wrongful conduct. Ponomarenko v. Shapiro, 287 F. Supp. 3d 816, 831 (N.D. Cal. 2018).

Colorado (1) Two or more persons, and for this purpose a corporation is a person; (2) an object to be accomplished; (3) a meeting of the minds on the object or course of action; (4) one or more unlawful overt acts; and (5) damages as the proximate result thereof. Walker v. Van Laningham, 148 P.3d 391, 396 (Colo. Ct. App. 2006).

Connecticut (1) A combination between two or more persons, (2) to do a criminal or an unlawful act or a lawful act by criminal or unlawful means, (3) an act done by one or more of the conspirators pursuant to the scheme and in furtherance of the object, (4) which act results in damage to the plaintiff. Marshak v. Marshak, 628 A.2d 964, 970 (Conn. 1993).

Delaware (1) A confederation or combination of two or more persons; (2) an unlawful act done in furtherance of the conspiracy; and (3) actual damage. AeroGlobal Capital Mgmt., LLC v. Cirrus Indus., Inc., 871 A.2d 428, 437 n.8 (Del. 2005).

Florida (1) An agreement between two or more parties, (2) to do an unlawful act or to do a lawful act by unlawful means, (3) the doing of some overt act in pursuance of the conspiracy, and (4) damage to plaintiff as a result of the acts done under the conspiracy. MP, LLC v. Sterling Holding, LLC, 231 So. 3d 517, 521–522 (Fla. Dist. Ct. App. 2017).

Georgia (1) Two or more persons, (2) acting in concert to accomplish an unlawful end or to accomplish a lawful end by unlawful means, (3) engaged in conduct that constitutes a tort Jenkins v. Wachovia Bank, Nat’l Ass’n, 711 S.E.2d 80, 85 (Ga. Ct. App. 2011).


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State Elements of civil conspiracy Hawaii (1) A combination of two or more persons or entities by concerted action

(2) to accomplish a criminal or unlawful purpose, or to accomplish some purpose not in itself criminal or unlawful by criminal or unlawful means. Pule v. Macomber, 2018 WL 283738, at *11 (D. Haw. Jan. 3, 2018).

Idaho (1) An agreement between two or more (2) to accomplish an unlawful objective or to accomplish a lawful objective in an unlawful manner. Taylor v. McNichols, 243 P.3d 642, 660 (Idaho 2010).

Illinois (1) A combination of two or more persons; (2) for the purpose of accomplishing by some concerted action either an unlawful purpose or a lawful purpose by unlawful means; (3) in the furtherance of which one of the conspirators committed an overt tortious or unlawful act. Fritz v. Johnston, 807 N.E.2d 461, 471 (Ill. 2004).

Indiana (1) A combination of two or more persons (2) who engage in a concerted action to accomplish an unlawful purpose or to accomplish some lawful purpose by unlawful means. Birge v. Town of Linden., 57 N.E.3d 839, 845 (Ind. Ct. App. 2016).

Iowa (1) A combination of two or more persons by concerted action (2) to accomplish an unlawful purpose, or to accomplish by unlawful means some purpose not in itself unlawful (3) resulting in actual damage from something done by one or more of the conspirators in furtherance of the object of the conspiracy. Wright v. Brooke Grp. Ltd., 652 N.W.2d 159, 171–72 (Iowa 2002); S. N.Y. Ry., Inc. v. Ft. Dodge, D. M. & S. Ry. Co., 316 N.W.2d 840, 844 (Iowa 1982).

Kansas (1) Two or more persons; (2) an object to be accomplished; (3) a meeting of the minds in the object or course of action; (4) one or more unlawful overt acts; and (5) damages as the proximate result thereof. Kincaid v. Dess, 298 P.3d 358, 369 (Kan. Ct. App. 2013).

Kentucky 1) An agreement or combination, 2) that is unlawful or corrupt, 3) entered into by two or more persons, and 4) for the purpose of accomplishing an unlawful goal. Ellington v. Fed. Home Loan Mortg. Corp., 13 F. Supp. 3d 723, 730 (W.D. Ky. 2014).

Louisiana (1) Conspiring with another person to commit an intentional or willful act and (2) damage caused by such act. Williams v. Bush, 2018 WL 3989621, at *6 (E.D. La. Aug. 21, 2018); La. Civ. Code art. 2324(A).

Maine (1) Two or more persons; (2) an object to be accomplished; (3) a meeting of minds on the object or course of action; (4) one or more unlawful acts; and (5) damages. Smith v. Coyne, 2004 WL 1433638, at *4 (Me. Super. Ct. Apr. 12, 2004).

Maryland (1) A confederation of two or more persons by agreement or understanding, (2) some unlawful or tortious act done in furtherance of the conspiracy, or use of unlawful or tortious means to accomplish an act not in itself illegal, and (3) actual legal damage resulting to the plaintiff. Lloyd v. GMC, 916 A.2d 257, 284 (Md. 2007).

Massachusetts (1) A common design or an agreement, although not necessarily express, between two or more persons to do a wrongful act, and (2) some tortious act


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State Elements of civil conspiracy in furtherance of the agreement. OR (1) Defendant knows that the conduct of another person constitutes a breach of duty and (2) gives substantial assistance or encouragement to the other so to conduct himself. Thomas v. Harrington, 909 F.3d 483, 490 (1st Cir. 2018).

Michigan (1) Concerted action; (2) by a combination of two or more persons; (3) to accomplish an unlawful purpose; and (4) or a lawful purpose by unlawful means. Crehan v. Countrywide Bank, FSB, 2012 WL 4341049, at *11 (W.D. Mich. Feb. 15, 2012), report and recommendation adopted, 2012 WL 4340848 (W.D. Mich. Sept. 20, 2012).

Minnesota (1) Two or more people worked together to accomplish (2) an unlawful purpose or (3) a lawful act by unlawful means. Rilley v. MoneyMutual, LLC, 329 F.R.D. 211, 217 (D. Minn. 2019).

Mississippi (1) A conspiracy, (2) an overt act of fraud in furtherance of the conspiracy, and (3) damages to the plaintiff as a result of the fraud. Taylor v. S. Farm Bureau Cas. Co., 954 So. 2d 1045, 1050 (Miss. Ct. App. 2007).

Missouri (1) Two or more persons; (2) with an unlawful objective; (3) after a meeting of the minds; (4) committed at least one act in furtherance of the conspiracy; and (5) the plaintiff was thereby damaged. W. Blue Print Co. v. Roberts, 367 S.W.3d 7, 22 (Mo. 2012).

Montana (1) Two or more persons, (2) with an object to be accomplished; (3) had a meeting of the minds on the object or course of action; (4) conducted one or more unlawful overt acts; and (5) damages were the proximate result of the conduct. Schumacker v. Meridian Oil Co., 956 P.2d 1370, 1373 (Mont. 1998); T-4 Corp. v. McDonald’s Corp., 2017 WL 3037422, at *7 (D. Mont. July 17, 2017).

Nebraska (1) A combination of two or more persons (2) to accomplish by concerted action an unlawful or oppressive object, or a lawful object by unlawful or oppressive means. W. Plains, L.L.C. v. Retzlaff Grain Co. Inc., 870 F.3d 774, 787–788 (8th Cir. 2017).

Nevada (1) A conspiracy agreement, which is a combination of two or more persons who, by some concerted action, intend to accomplish an unlawful objective for the purpose of harming another; (2) an overt act of fraud in furtherance of the conspiracy; and (3) resulting damages to the plaintiff. Jordan v. State ex rel. Dep’t of Motor Vehicles & Pub. Safety, 110 P.3d 30, 51 (Nev. 2005).

New Hampshire (1) Two or more persons, including corporations; (2) an object to be accomplished (i.e., an unlawful object to be achieved by lawful or unlawful means or a lawful object to be achieved by unlawful means); (3) an agreement on the object or course of action; (4) one or more unlawful overt acts; and (5) damages as the proximate result thereof. In re Appeal of Armaganian, 784 A.2d 1185, 1189 (N.H. 2001).

New Jersey (1) A combination of two or more persons acting in concert to commit an unlawful act, or to commit a lawful act by unlawful means, (2) the principal element of which is an agreement between the parties to inflict a wrong against or injury upon another, and (3) an overt act that results in damage. Banco Popular N. Am. v. Gandi, 876 A.2d 253, 263 (N.J. 2005).


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State Elements of civil conspiracy New Mexico (1) A conspiracy between two or more individuals existed, (2) specific

wrongful acts were carried out by defendant pursuant to the conspiracy, and (3) Plaintiffs were damaged as a result of such acts. Coll v. First Am. Title Ins. Co., 642 F.3d 876, 901 (10th Cir. 2011).

New York (1) An agreement between two or more parties; (2) an overt act in furtherance of the agreement; (3) the parties’ intentional participation in the furtherance of a plan or purpose; and (4) resulting damage or injury. Great Lakes Motor Corp. v. Johnson, 68 N.Y.S.3d 614, 617 (N.Y. App. Div. 2017).

North Carolina (1) An agreement between two or more individuals; (2) to do an unlawful act or to do a lawful act in an unlawful way; (3) resulting in injury to plaintiff inflicted by one or more of the conspirators; and (4) pursuant to a common scheme. Mountain Land Prop., Inc. v. Lovell, 46 F. Supp. 3d 609, 631 (W.D.N.C. 2014).

North Dakota (1) A combination of two or more persons acting in concert to commit an unlawful act, or to commit a lawful act by unlawful means, (2) the principal element of which is an agreement between the parties to inflict a wrong against or injury upon another, and (3) an overt act that results in damage. Burris Carpet Plus, Inc. v. Burris, 785 N.W.2d 164, 179 (N.D. 2010).

Ohio (1) A malicious combination of two or more persons to injure another person or property, (2) in a way not competent for one alone, (3) resulting in actual damages. The element of “malicious combination to injure” does not require a showing of an express agreement between defendants, but only a common understanding or design, even if tacit, to commit an unlawful act. Ohio Dist. Council, Inc. of the Assemblies of God v. Speelman, 114 N.E.3d 285, 296 (Ohio Ct. App. 2018).

Oklahoma (1) A combination of two or more persons; (2) an object to be accomplished; (3) a meeting of the minds on the object or course of action; (4) one or more unlawful overt acts; and (5) damages as a proximate result thereof. Zagorski v. McAdam, 2014 WL 2982669, at *6 (W.D. Okla. July 1, 2014).

Oregon (1) Two or more persons; (2) an object to be accomplished; (3) a meeting of the minds on the object or course of action; (4) one or more unlawful overt acts; and (5) damages as a result of the overt act or acts. Morasch v. Hood, 222 P.3d 1125, 1131–1132 (Or. App. 2009).

Pennsylvania (1) A combination of two or more persons acting with a common purpose to do an unlawful act or to do a lawful act by unlawful means or for an unlawful purpose; (2) an overt act done in pursuance of the common purpose; and (3) actual legal damage. Gen. Refractories v. Fireman’s Fund Ins. Co., 337 F.3d 297, 313 (3d Cir. 2003).

Rhode Island (1) There was an agreement between two or more parties and (2) the purpose of the agreement was to accomplish an unlawful objective or to accomplish a lawful objective by unlawful means. W. Reserve Life Assur. Co. of Ohio v. Caramadre, 847 F. Supp. 2d 329, 347 (D.R.I. 2012), aff’d sub nom. W. Reserve Life Assur. Co. of Ohio v. ADM Assocs., LLC, 793 F.3d 168 (1st Cir. 2015).


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State Elements of civil conspiracy South Carolina (1) The combination of two or more people; (2) for the purpose of injuring the

plaintiff; and (3) which cause special damages. Pye v. Estate of Fox, 633 S.E.2d 505, 511 (S.C. 2006).

South Dakota (1) Two or more persons; (2) an object to be accomplished; (3) a meeting of the minds on the object or course of action to be taken; (4) the commission of one or more unlawful overt acts; and (5) damages as the proximate result of the conspiracy. Kirlin v. Halverson, 758 N.W.2d 436, 455 (S.D. 2008).

Tennessee (1) A common design between two or more persons, (2) to accomplish by concerted action an unlawful purpose, or a lawful purpose by unlawful means, (3) an overt act in furtherance of the conspiracy, and (4) resulting injury. Lapinsky v. Cook, 536 S.W.3d 425, 444 (Tenn. Ct. App. 2016).

Texas (1) A combination of two or more persons; (2) the persons seek to accomplish an object or course of action; (3) the persons reach a meeting of the minds on the object or course of action; (4) one or more unlawful, overt acts are taken in pursuance of the object or course of action; and (5) damages occur as a proximate result. Chon Tri v. J.T.T., 162 S.W.3d 552, 556 (Tex. 2005).

Utah (1) A combination of two or more persons, (2) an object to be accomplished, (3) a meeting of the minds on the object or course of action, (4) one or more unlawful, overt acts, and (5) damages as a proximate result thereof. Harvey v. Ute Indian Tribe of Uintah & Ouray Reservation, 416 P.3d 401, 424 (Utah 2017).

Vermont (1) A combination of two or more persons to effect an illegal purpose, either by legal or illegal means, or to effect a legal purpose by illegal means; (2) damages resulting from something done in furtherance of the agreement, and (3) the thing done must be something unlawful in itself. Jenkins v. Miller, 2017 WL 4402431, at *10 (D. Vt. Sept. 29, 2017).

Virginia (1) An agreement between two or more persons (2) to accomplish an unlawful purpose or to accomplish a lawful purpose by unlawful means, which (3) results in damage to plaintiff. Cox v. MAG Mut. Ins. Co., 2015 WL 1640513, at *6 (E.D. Va. Apr. 9, 2015).

Washington (1) Two or more people combined to accomplish an unlawful purpose or combined to accomplish a lawful purpose by unlawful means; and (2) the conspirators entered into an agreement to accomplish the conspiracy. Newton Ins. Agency & Brokerage, Inc. v. Caledonian Ins. Grp., Inc., 52 P.3d 30, 35 (Wash. Ct. App. 2002).

West Virginia (1) Two or more people who are named as defendants (2) agreed to commit overt tortious act(s) for a common purpose (3) committed the overt tortious act(s) (4) proximately causing Plaintiff harm. Nat’l Credit Union Admin. Bd. v. Bailey, 2016 WL 3951209, at *7–8 (S.D. W. Va. July 20, 2016).

Wisconsin (1) The formation and operation of a conspiracy, which is a combination of two or more persons by some concerted action to accomplish some unlawful purpose or to accomplish by unlawful means some purpose not in itself unlawful; (2) a wrongful act or acts done pursuant to the conspiracy; and (3) damage resulting from the act or acts. N. Highland, Inc. v. Jefferson Mach. & Tool Inc., 898 N.W.2d 741, 747 (Wis. 2017).


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State Elements of civil conspiracy Wyoming (1) Two or more persons; (2) an object to be accomplished; (3) a meeting of

the minds in the object or course of action; (4) one or more unlawful overt acts; and (5) damages as the proximate cause thereof. White v. Shane Edeburn Constr., LLC, 285 P.3d 949, 958 (Wyo. 2012).


APPENDIX 2


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State-law elements for fraud by active concealment

State Elements Alabama Active concealment of material facts is actionable without proof of duty to disclose. Hawkins v. Cent. Bank of the

S., 585 So. 2d 15, 18 (Ala. 1991); Berkel & Co. Contractors v. Providence Hosp., 454 So. 2d 496, 505 (Ala. 1984); Collier v. Brown, 228 So. 2d 800, 802 (Ala. 1969); Harlan v. Smith, 507 So. 2d 943, 946 (Ala. Civ. App. 1986). Elements: (1) Active concealment or nondisclosure of material facts by the defendant; (2) inducement of the plaintiff to act; (3) action by the plaintiff in reasonable reliance thereon to his or her injury. CHN Am., LLC v. Ligon Capital, LLC, 160 So. 3d 1195 (Ala. 2013); Johnson v. Sorensen, 914 So. 2d 830, 837 (Ala. 2005); Hawkins, 585 So. 2d at 18; Berkel, 454 So. 2d at 505; Harlan, 507 So. 2d at 946.

Alaska Active concealment of material facts is actionable without proof of duty to disclose. Cape Fox Corp. v. Jackson, 2010 WL 3951988, at *2 (D. Alaska Oct. 7, 2010). Elements: (1) The defendant’s active concealment of fact (2) made fraudulently (i.e., with scienter), (3) for the purpose or with the expectation of inducing another to act in reliance, (4) with justifiable reliance by the recipient, (5) causing loss. Recreational Data Servs., Inc. v. Trimble Navigation Ltd., 404 P.3d 120, 126 (Alaska 2017), cert. denied, 138 S. Ct. 1272 (2018); Cape Fox, 2010 WL 3951988, at *2.

Arizona Active concealment of material facts is actionable without proof of duty to disclose. Wells Fargo Bank v. Ariz. Laborers, Teamsters & Cement Masons Local No. 395 Pension Trust, 38 P.3d 12, 34 (Ariz. 2002). Elements: (1) The active concealment of a material existing fact; (2) knowledge on the part of the party against whom the claim is asserted that such a fact is being concealed; (3) ignorance of that fact on the part of the one from whom the fact is concealed; (4) the intention that the concealment be acted upon; and (5) action on the concealment resulting in damages. Insight Pub. Sector, Inc. v. Proteam Sols., Inc., 2016 WL 6648167, at *7 n.39 (D. Ariz. Nov. 10, 2016); Wells Fargo, 38 P.3d at 34.

Arkansas Active concealment of material facts is actionable without proof of duty to disclose. Bridges v. United Sav. Ass’n, 438 S.W.2d 303, 306 (Ark. 1969); Baskin v. Collins, 806 S.W.2d 3, 5 (Ark. 1991); In re Genetically Modified Rice Litig., 2007 WL 3027580, at *2 (E.D. Mo. Oct. 15, 2007).


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State Elements Elements: (1) Active concealment of a material matter known to the party; (2) intent to induce action or inaction in reliance upon the concealed matter; (4) justifiable reliance on the concealed matter; and (5) damages suffered as a result of the reliance. Adeli v. Silverstar Auto., Inc., 2018 WL 4374194, at *7 (W.D. Ark. Sept. 13, 2018); Bridges, 438 S.W. 2d at 306; Baskin, 806 S.W.2d at 5; Genetically Modified Rice, 2007 WL 3027580, at *2.

California Active concealment of material facts is actionable without proof of duty to disclose. Hodson v. Mars, Inc., 891 F.3d 857, 862 (9th Cir. 2018); Burch v. CertainTeed Corp., 2019 WL 1594460, at *5 (Cal. Ct. App. Apr. 15, 2019). Elements: (1) Concealment or suppression of a material fact by a defendant; (2) the defendant intended to defraud the plaintiff by intentionally and actively concealing or suppressing the fact; (3) the plaintiff was unaware of the fact and would not have acted as he or she did if he or she had known of the concealed or suppressed fact; and (4) plaintiff sustained damage as a result of the concealment or suppression of the fact. Dent v. NFL, 902 F.3d 1109, 1125 (9th Cir. 2018); Hodson, 891 F.3d at 862.

Colorado Active concealment of material facts is actionable without proof of duty to disclose. First Interstate Bank of Fort Collins, N.A. v. Piper Aircraft Corp., 744 P.2d 1197, 1200–01 (Colo. 1987); Notes on Use to Colorado Jury Instruction 19:6. Elements: (1) The active concealment of a material existing fact; (2) knowledge on the part of the party against whom the claim is asserted that such a fact is being actively concealed; (3) ignorance of that fact on the part of the one from whom the fact is concealed; (4) the intention that the concealment be acted upon; and (5) action on the concealment resulting in damages. Spring Creek Expl. & Prod. Co. v. Hess Bakken Inv., II, LLC, 887 F.3d 1003, 1020 (10th Cir. 2018); Baker v. Wood, Ris & Hames, PC, 364 P.3d 872, 883 (Colo. 2016); BP Am. Prod. Co. v. Patterson, 263 P.3d 103, 109 (Colo. 2011); First Interstate, 744 P.2d at 1200–01.

Connecticut Active concealment of material facts is actionable without proof of duty to disclose. Gayne v. Smith, 134 A. 62 (Conn. 1926); Am. Sur. Co. v. Pac. Sur. Co., 70 A. 584, 586 (Conn. 1908). Elements: (1) The active concealment of material facts; (2) the defendant knew that the facts were actively being disclosed; (3) the active concealment was intended to induce the other party to act; and (4) the other party did so act upon the actively concealed facts to his injury. Stuart v. Freiberg, 116 A.3d 1195, 1203-04 (Conn. 2015); Reville v. Reville, 93 A.3d 1076, 1087 (Conn. 2014); Gayne, 134 A. at 62; Am. Sur, 70 A. at 586.

Delaware Active concealment of material facts is actionable without proof of duty to disclose. Gaffin v. Teledyne, Inc., 611 A.2d 467, 472 (Del. 1992); Nicolet, Inc. v. Nutt, 525 A.2d 146, 150 (Del. 1987); Stephenson v. Capano Dev., Inc.,


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State Elements 462 A.2d 1069, 1074 (Del. 1983); Air Prods. & Chems., Inc. v. Wiesemann, 237 F. Supp. 3d 192, 214–15 (D. Del. 2017). Elements: (1) Deliberate concealment by the defendant of a material past or present fact, or silence in the face of a duty to speak; (2) the defendant acted with scienter; (3) the defendant had an intent to induce plaintiff’s reliance upon the concealment; (4) causation; and (5) damages resulting from the concealment. Nicolet, 525 A.2d at 149; MacQueen v. Union Carbide Corp., 2018 WL 2729122, at *3 (D. Del. June 6, 2018), report and recommendation adopted, 2018 WL 6790311 (D. Del. Sept. 24, 2018).

Florida Active concealment of material facts is actionable without proof of duty to disclose. Joiner v. McCullers, 28 So. 2d 823, 825 (Fla. 1947); Philip Morris USA, Inc. v. Duignan, 243 So. 3d 426, 440 (Fla. Dist. Ct. App. 2017). Elements: (1) The defendant actively concealed a material fact; (2) the defendant knew or should have known the material fact should be disclosed; (3) the defendant knew that its active concealment of the material fact would induce the plaintiff to act; (4) the plaintiff detrimentally relied on the misinformation. Hess v. Philip Morris USA, Inc., 175 So. 3d 687, 691 (Fla. 2015); Cote v. R.J. Reynolds Tobacco Co., 909 F.3d 1094, 1106 n.6 (11th Cir. 2018); Joiner, 28 So. 2d at 825; Philip Morris USA, 243 So. 3d at 440.

Georgia Active concealment of material facts is actionable without proof of duty to disclose. Boyd v. JohnGalt Holdings, LLC, 755 S.E.2d 675, 681 (Ga. 2014); Reeves v. B.T. Williams & Co., 127 S.E. 293 (Ga. 1925); Miller v. Lomax, 596 S.E.2d 232, 239 (Ga. Ct. App. 2004). Elements: (1) Active concealment of a material fact; (2) scienter; (3) intention to induce the party claiming fraud to act or refrain from acting; (4) justifiable reliance; and (5) damages. Rampura, LLC v. Main & 75 Ctr., LLC, 2008 WL 3861203, at *9 (N.D. Ga. Feb. 13, 2008); Boyd, 755 S.E.2d at 681; Reeves, 127 S.E. 293; Miller, 596 S.E.2d at 239.

Hawaii Active concealment of material facts is actionable without proof of duty to disclose. Schmidt v. HSC, Inc., 358 P.3d 727, 743 (Haw. Ct. App. 2015); Ditto v. McCurdy, 947 P.2d 961, 999 (Haw. Ct. App.), aff’d in part, rev’d in part on other grounds, 947 P.2d 952 (Haw. 1997). Elements: 1) The defendant’s actively concealment of material facts (2) that he knows may justifiably induce the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these actively concealed facts, and (4) plaintiff did justifiably rely upon them. Tauese v. State, Dep’t of Labor & Indus.


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State Elements Relations, 147 P.3d 785, 821 (Haw. 2006); Santiago v. Tanaka, 366 P.3d 612, 624 (Haw. 2015); Schmidt, 358 P.3d at 743.

Idaho Active concealment of material facts is actionable without proof of duty to disclose. Thurston Enters., Inc. v. Safeguard Bus. Sys., Inc., 435 P.3d 489, 506 (Idaho 2019). Elements: (1) An active concealment of material facts; (2) reliance on the concealment; (3) the reliance was material to the transaction; and (4) damage as a proximate result of the concealment. Watts v. Krebs, 962 P.2d 387, 390 (Idaho 1998); Thurston Enters., 435 P.3d at 506.

Illinois Active concealment of material facts is actionable without proof of duty to disclose. Mitchell v. Skubiak, 618 N.E.2d 1013, 1017 (Ill. Ct. App. 1993); Russow v. Bobola, 277 N.E.2d 769 (Ill. Ct. App. 1972). Elements: (1) The defendant actively concealed a material fact; (2) the defendant intended to induce a false belief; (3) the plaintiff could not have discovered the truth through reasonable inquiry or inspection, or was prevented from making a reasonable inquiry or inspection, and justifiably relied upon the defendant’s silence as a representation that the fact did not exist; (4) the concealed information was such that the plaintiff would have acted differently had he or she been aware of it; and (5) the plaintiff’s reliance resulted in damages. Abazari v. Rosalind Franklin Univ. of Med. & Sci., 40 N.E.3d 264, 274 (Ill. Ct. App. 2015); Mitchell, 618 N.E.2d at 1017; Russow, 277 N.E.2d 769.

Indiana Active concealment of material facts is actionable without proof of duty to disclose. Lyons v. Richmond Cmty. Sch. Corp., 19 N.E.3d 254, 260–61 (Ind. 2014); Catt ex rel. Skeans v. Affirmative Ins. Co., 2009 WL 2175986, at *11 (N.D. Ind. July 21, 2009), report and recommendation adopted as modified, 2010 WL 456998 (N.D. Ind. Feb. 3, 2010). Elements: (1) The wrongdoer actively concealed material facts, (2) the other justifiably relied upon such non-disclosure to his detriment. Rose v. NCAA, 346 F. Supp. 3d 1212, 1225 (N.D. Ill. 2018) (citing DeVoe Chevrolet-Cadillac, Inc. v. Cartwright, 526 N.E.2d 1237, 1240 (Ind. Ct. App. 1988)); Lyons, 19 N.E.3d at 260–61; Catt, 2009 WL 2175986, at *11.

Iowa Active concealment of material facts is actionable without proof of duty to disclose. Wilden Clinic, Inc. v. City of Des Moines, 229 N.W.2d 286 (Iowa 1975); Qwest Commc’ns Co. v. Aventure Commc’ns Tech., LLC, 86 F. Supp. 3d 933, 1014 (S.D. Iowa 2015).


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State Elements Elements: (1) Active concealment of facts, (2) materiality, (3) scienter, (4) intent to deceive, (5) justifiable reliance, and (6) resulting injury or damage. Clark v. McDaniel, 546 N.W.2d 590, 592 (Iowa 1996); Wilden Clinic, 229 N.W.2d 286; Qwest, 86 F. Supp. 3d at 1014.

Kansas Active concealment of material facts is actionable without proof of duty to disclose. Gardner Grp., LLC v. Commonwealth Land Title Ins. Co., 2017 WL 193165, at *3 (D. Kan. Jan. 18, 2017). Elements: (1) Defendant had knowledge of material facts which plaintiff did not have and which plaintiff could not have been discovered by the exercise of reasonable diligence; (2) defendant intentionally and actively concealed the material facts; (4) plaintiff justifiably relied on defendant to communicate the material facts to plaintiff; and (5) plaintiff sustained damages as a result of defendant’s failure to communicate the material facts to the plaintiff. Miller v. Sloan, Listrom, Eisenbarth, Sloan & Glassman, 978 P.2d 922, 932–33 (Kan. 1999); In re Estate of Pritchard, 154 P.3d 24, 33 (Kan. Ct. App. 2007); Gardner Grp., 2017 WL 193165, at *3.

Kentucky Active concealment of material facts is actionable without proof of duty to disclose. Hazel v. GMC, 142 F.3d 434 (6th Cir. 1998) (applying Kentucky law). Elements: (1) The defendant actively concealed material facts; (2) the defendant’s active concealment of the material facts induced the plaintiff to act; and (3) the plaintiff suffered actual damages as a consequence. Giddings & Lewis, Inc. v. Indus. Risk Insurers, 348 S.W.3d 729, 747 (Ky. 2011); Hazel, 142 F.3d 434.

Louisiana Active concealment of material facts is actionable without proof of duty to disclose. Jones v. Wells Fargo Bank, N.A., 626 F. App’x 500, 505 (5th Cir. 2015) (applying Louisiana law). Elements: (1) An active concealment of a material fact; (2) made with intent to deceive; and (3) causing justifiable reliance with resultant injury. Kadlec Med. Ctr. v. Lakeview Anesthesia Assocs., 527 F.3d 412, 418 (5th Cir. 2008); Jones, 626 F. App’x at 505.

Maine Active concealment of material facts is actionable without proof of duty to disclose. McGeechan v. Sherwood, 760 A.2d 1068, 1081 (Me. 2000); Kezer v. Mark Stimson Assocs., 742 A.2d 898, 905 (Me. 1999); Martin v. Ort, 2016 WL 1069907, at *3 (Me. Super. Ct. Feb. 3, 2016). Elements: (1) Active concealment; (2) of a material fact; (3) with the intention of inducing another to act or to refrain from acting in reliance on the active concealment; and (4) which is in fact relied upon to the aggrieved party’s detriment. Barr v. Dyke, 49 A.3d 1280, 1287 (Me. 2012); McGeechan, 760 A.2d at 1081; Kezer, 742 A.2d at 905; Martin, 2016 WL 1069907, at *3.


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State Elements Maryland Active concealment of material facts is actionable without proof of duty to disclose. Rhee v. Highland Dev. Corp.,

958 A.2d 385, 391 (Md. Ct. Spec. App. 2008); Soft Stuff Distribs., Inc. v. Ryder Truck Rental, Inc., 2012 WL 3111679, at *4 (D. Md. July 30, 2012); Void v. OneWest Bank, 2011 WL 3240478, at *5 (D. Md. July 27, 2011). Elements: (1) The defendant actively concealed a material fact; (2) the defendant intended to defraud or deceive the plaintiff; (3) the plaintiff took action in justifiable reliance on the concealment; and (4) the plaintiff suffered damages as a result of the defendant’s concealment. Lloyd v. GMC, 916 A.2d 257, 274 (Md. 2007); Rhee, 958 A.2d at 391; Soft Stuff, 2012 WL 3111679, at *4; Void, 2011 WL 3240478, at *5.

Massachusetts Active concealment of material facts is actionable without proof of duty to disclose. Demoulas v. Demoulas Super Mkts., Inc., 677 N.E.2d 159, 174 n.25 (Mass. 1997); Gladstone v. Murray Co., 50 N.E.2d 958, 960 (Mass. 1943). Elements: (1) Defendant actively suppresses a material fact; (2) defendant’s suppression of the material fact induces plaintiff to act or to refrain from acting; and (3) plaintiff suffers actual damage as a proximate result. Peters v. Amoco Oil Co., 57 F. Supp. 2d 1268, 1281 (M.D. Ala. 1999) (citing Nota Constr. Corp. v. Keyes Assoc., Inc., 694 N.E.2d 401, 404 (Mass. Ct. App. 1998)); Demoulas, 677 N.E.2d at 174 n. 25; Gladstone, 50 N.E.2d at 960.

Michigan Active concealment of material facts is actionable without proof of duty to disclose. Hi-Lex Controls Inc. v. Blue Cross & Blue Shield of Mich., 2013 WL 2285453, at *29 (E.D. Mich. May 23, 2013), amended, 2013 WL 3773364 (E.D. Mich. July 17, 2013), aff’d sub nom. Hi-Lex Controls, Inc. v. Blue Cross & Blue Shield of Mich., 751 F.3d 740 (6th Cir. 2014). Elements: (1) Defendant active concealed a material fact; (2) defendant had actual knowledge of the fact; (3) defendant’s failure to disclose the fact caused plaintiff to have a false impression; (4) when defendant actively concealed the fact, defendant knew the failure would create a false impression; (5) when defendant actively concealed the fact, defendant intended that plaintiff rely on the resulting false impression; (6) plaintiff relied on the false impression; (7) plaintiff was damaged as a result of that reliance. United States Fid. & Guar. Co v. Black, 313 N.W.2d 77 (Mich. 1981); Mich. Model Civil Jury Inst. 128.02; Hi-Lex Controls, 2013 WL 2285453, at *29.

Minnesota Active concealment of material facts is actionable without proof of duty to disclose. U.S. Bank N.A. v. Cold Spring Granite Co., 802 N.W.2d 363, 373 (Minn. 2011); Boubelik v. Liberty State Bank, 553 N.W.2d 393, 399 (Minn. 1996).


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State Elements Elements: (1) A party actively conceals a fact material to a transaction; (2) the fact is peculiarly within the concealing party’s knowledge, (3) the concealing party knows the other party will act on the presumption that no such fact exists, and (4) plaintiff was damaged as a result of that reliance. Powell v. Trans Global Tours, Inc., 594 N.W.2d 252, 256 (Minn. Ct. App. 1999); U.S. Bank, 802 N.W.2d at 373; Boubelik, 553 N.W.2d at 399.

Mississippi Active concealment of material facts is actionable without proof of duty to disclose. Davidson v. Rogers, 431 So. 2d 483, 484–85 (Miss. 1983). Elements: (1) A representation or active concealment of a fact; (2) its falsity; (3) its materiality; (4) the speaker’s knowledge of its falsity or ignorance of its truth; (5) his intent that it should be acted on by the person in a manner reasonably contemplated; (6) the hearer’s ignorance of its falsity; (7) the hearer’s reliance on its truth; (8) the hearer’s right to rely thereon; and (9) the hearer’s consequent and proximate injury. Watson Labs., Inc. v. State, 241 So. 3d 573, 594 (Miss. 2018); Davidson, 431 So. 2d at 484–85.

Missouri Active concealment of material facts is actionable without proof of duty to disclose. Vendt v. Duenke, 210 S.W.2d 692, 699 (Mo. Ct. App. 1948). Elements: (1) Active concealment of a material fact (2) intent of the non-speaker that the decedent would act on the concealment, (3) the decedent’s ignorance of the facts being concealed, (4) reliance, (5) the decedent’s right to rely, and (7) proximately-caused injury. Thompson v. R.J. Reynolds Tobacco Co., 2013 WL 12075969, at *3 (W.D. Mo. May 3, 2013) (citing Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 765 (Mo. 2007)), aff’d, 760 F.3d 913 (8th Cir. 2014); Vendt, 210 S.W.2d at 699.

Montana A duty to disclose is not required for a claim of actual fraud by a contracting party. Mont. Code Ann. § 28-2-405(3) (actual fraud by a contracting party includes “the suppression of that which is true by one having knowledge or belief of the fact”). No duty to disclose is required, unlike a claim for deceit by a non-contracting party. Town of Geraldine v. Mont. Mun. Ins. Auth., 198 P.3d 796, 801 (Mont. 2008); Mont. Code Ann. § 27-1-712(2)(c) (deceit by a non-contracting party includes “the suppression of a fact by one who is bound to disclose it”). Elements: (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) the speaker’s intent that the suppressed fact should be acted upon by the person and in the manner reasonably contemplated; (4) the hearer’s ignorance of the truth; (5) the hearer’s reliance; (6) the hearer’s right to rely; and (7) the hearer’s consequent and proximate injury or damages caused by their reliance. Town of Geraldine, 198 P.3d at 801; Mont. Code Ann. § 28-2-405.


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State Elements Nebraska Active concealment of material facts is actionable without proof of duty to disclose. Driekosen v. Black, Sivalls &

Bryson, Inc., 64 N.W.2d 88, 98 (Neb. 1954). Elements: (1) The defendant, with knowledge of a material fact, actively concealed the fact; (2) the material fact was not within the plaintiff’s reasonably diligent attention, observation, and judgment; (3) the defendant actively concealed the fact with the intention that the plaintiff act or refrain from acting in response to the concealment or suppression; (4) the plaintiff, reasonably relying on the fact or facts as the plaintiff believed them to be as the result of the concealment, acted or withheld action; and (5) the plaintiff was damaged by the plaintiff’s action or inaction in response to the concealment. Knights of Columbus Council 3152 v. KFS BD, Inc., 791 N.W.2d 317, 334 (Neb. 2010); Driekosen, 64 N.W.2d at 98.

Nevada Active concealment of material facts is actionable without proof of duty to disclose. Masini v. Quilici, 218 P.2d 946, 955 (Nev. 1950). Elements: (1) The defendant actively concealed or suppressed a material fact; (2) the defendant intentionally and actively concealed or suppressed the fact with the intent to defraud the plaintiff; that is, the defendant actively concealed or suppressed the fact for the purpose of inducing the plaintiff to act differently than she would have if she had known the fact; (3) the plaintiff was unaware of the fact and would have acted differently if she had known of the actively concealed or suppressed fact; (4) and, as a result of the active concealment or suppression of the fact, the plaintiff sustained damages. Rivera v. Philip Morris, Inc., 395 F.3d 1142, 1154 (9th Cir. 2005) (quoting Dow Chem. Co. v. Mahlum, 970 P.2d 98, 110 (Nev. 1998)), overruled in part on other grounds, GES, Inc. v. Corbitt, 21 P.3d 11 (Nev. 2001); Masini, 218 P.2d at 955.

New Hampshire Active concealment of material facts is actionable without proof of duty to disclose. Lamprey v. Britton Constr., Inc., 37 A.3d 359, 366 (N.H. 2012); Johnson v. Capital Offset Co., 2013 WL 5406613, at *5 (D.N.H. Sept. 25, 2013). Elements: (1) The intentional and active concealment of a material fact; (2) made for the purpose of inducing another to act or refrain from action; (3) justifiable reliance; and (4) pecuniary loss. Tessier v. Rockefeller, 33 A.3d 1118, 1124 (N.H. 2011); In the Matter of Flickinger, 2008 WL 11258738, at *1 (N.H. Mar. 18, 2008); LeClerc v. Prudential Ins. Co., 39 A.2d 763 (N.H. 1944); Lamprey, 37 A.3d at 366.

New Jersey Active concealment of material facts is actionable without proof of duty to disclose. Pioneer Nat’l Title Ins. Co. v. Lucas, 382 A.2d 933, 938 (N.J. Ct. App. Div.), aff’d sub nom. Pioneer Nat’l Title Ins. Co. v. Lucas, 394 A.2d 360 (N.J. 1978).


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State Elements Elements: (1) The defendant actively concealed information from the plaintiff; (2) the information was material; (3) the plaintiff could not readily have learned of the information without the defendant disclosing it; (4) the defendant intentionally and actively withheld, altered, or destroyed the information; and (5) the plaintiff suffered harm by relying on the non-disclosure. Steele v. Depuy Orthopaedics, Inc., 295 F. Supp. 2d 439, 456 (D.N.J. 2003); Pioneer, 382 A.2d at 938.

New Mexico Active concealment of material facts is actionable without proof of duty to disclose. Kern By & Through Kern v. St. Joseph Hosp., Inc., 697 P.2d 135, 143 (N.M. 1985); Little v. Baigas, 390 P.3d 201, 210 (N.M. Ct. App. 2016). Elements: (1) The defendant’s active concealment of material facts (2) that he knows may justifiably induce the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these actively concealed material facts, and (4) detrimental reliance and damages. Alfaro-Huitron v. WKI Outsourcing Sols., LLC, 2018 WL 522312, at *16 (D.N.M. Jan. 22, 2018); Restatement (First) of Torts § 551 (1938) (cited approvingly by McElhannon v. Ford, 73 P.3d 827, 831 (N.M. Ct. App. 2003), and R.A. Peck, Inc. v. Liberty Fed. Sav. Bank, 766 P.2d 928, 932 (N.M. Ct. App. 1988); Kern, 697 P.2d at 143; Little, 390 P.3d at 210.

New York Active concealment of material facts is actionable without proof of duty to disclose. London v. Courduff, 529 N.Y.S.2d 874, 875 (N.Y. App. Div. 1988); In re Windsor Plumbing Supply Co., 170 B.R. 503, 529 (Bankr. E.D.N.Y. 1994). Elements: (1) Active concealment of material facts; (2) knowledge of material facts by a party bound to make such disclosures; (3) scienter; (4) reliance; and (5) damages. Oden v. Bos. Sci. Corp., 330 F. Supp. 3d 877, 898 (E.D.N.Y. 2018); London, 529 N.Y.S.2d at 875; In re Windsor, 170 B.R. at 529.

North Carolina Active concealment of material facts is actionable without proof of duty to disclose. Tillery Envtl. LLC v. A & D Holdings, Inc., 2018 WL 802515, at *7 (N.C. Super. Ct. Feb. 9, 2018). Elements: (1) Active concealment of a material fact, (2) reasonably calculated to deceive, (3) made with intent to deceive, (4) which does in fact deceive, (5) resulting in damage to the injured party. Forbis v. Neal, 649 S.E.2d 382, 387 (N.C. 2007); Tillery, 2018 WL 802515, at *7.

North Dakota Concealment of material facts, whether active or not, is actionable without by a contracting party proof of duty to disclose in an action. Northstar Founders, LLC v. Hayden Capital USA, LLC, 855 N.W.2d 614, 626 (N.D. 2014); N.D.C.C. § 9–03–08. A duty to disclose is required only in a claim for deceit by a non-contracting party. See Erickson v. Brown, 747 N.W.2d 34, 44 (N.D. 2008); N.D.C.C. § 9–10–03.


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State Elements Elements: (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) materiality; (4) reliance; and (5) actual damages proximately caused by the nondisclosure. Northstar Founders, 855 N.W.2d at 626; N.D.C.C. § 9–03–08.

Ohio Active concealment of material facts is actionable without proof of duty to disclose. Latrobe Steel Co. v. Ajax Tocco Magnethermic Corp., 2009 WL 10689040, at *3 (N.D. Ohio Apr. 9, 2009). Elements: (1) Active concealment of a fact, (2) which is material to the transaction at hand, (3) made falsely, with knowledge of its falsity, or with such utter disregard and recklessness as to whether it is true or false that knowledge may be inferred, (4) with the intent of misleading another into relying upon it, (5) justifiable reliance upon the representation or concealment, and (6) a resulting injury proximately caused by the reliance. Lloyd v. Doherty, 2018 WL 6584288, at *5–6 (6th Cir. Nov. 27, 2018); Latrobe Steel, 2009 WL 10689040, at *3.

Oklahoma Active concealment of material facts is actionable without proof of duty to disclose. Lampton Welding Supply Co. v. Stobaugh, 2012 WL 5398790, at *15 (N.D. Okla. Nov. 2, 2012). But a duty to disclose is not required for a claim of actual fraud by a non-contracting party. Okla. Stat. Ann. tit. 15, § 58 (actual fraud by a contracting party includes the “suppression of that which is true, by one having knowledge or belief of the fact”). A claim of deceit, by a non-contracting party, requires a duty to disclose. See Okla. Stat. Ann. tit. 76, § 3 (action for deceit by non-contracting party include “suppression of a fact by one who is bound to disclose it”). Elements: (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) materiality; (4) reliance; and (5) actual damages proximately caused by the nondisclosure. Okla. Stat. Ann. tit. 15, § 58 Okla. Civil Jury. Inst. § 18.2; Lampton, 2012 WL 5398790, at *5–6.

Oregon Active concealment of material facts is actionable without proof of duty to disclose. Wieber v. FedEx Ground Package Sys., Inc., 220 P.3d 68, 79 (Or. Ct. App. 2009); Caldwell v. Pop’s Homes, Inc., 634 P.2d 471, 477 (Or. Ct. App. 1981); Unigestion Holding, S.A. v. UPM Tech., Inc., 160 F. Supp. 3d 1214, 1223–24 (D. Or. 2016). Elements: (1) Active concealment of a material fact; (2) the fact’s materiality; (3) the speaker’s knowledge of its falsity or ignorance of its truth; (4) his intent that it should be acted on by the person and in the manner reasonably contemplated; (5) the hearer’s ignorance of its falsity; (6) his reliance on its truth; (7) his right to rely thereon; (8) and his consequent and proximate injury. Unigestion Holding, 160 F. Supp. 3d at 1223; Wieber, 220 P.3d at 79; Caldwell, 634 P.2d at 477.


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State Elements Pennsylvania Active concealment of material facts is actionable without proof of duty to disclose. Gnagey Gas & Oil Co. v. Pa.

Underground Storage Tank Indemnification Fund, 82 A.3d 485, 501 (Pa. Commw. Ct. 2013); Rissmiller v. NGK N. Am., Inc., 2018 WL 4203839, at *3 (E.D. Pa. Sept. 4, 2018); In re Gen. Motors LLC Ignition Switch Litig., 257 F. Supp. 3d 372, 442–43 (S.D.N.Y. 2017); Aetna, Inc. v. Health Diagnostic Lab. Inc., 2015 WL 9460072, at *4 (E.D. Pa. Dec. 28, 2015). Elements: (1) Actively concealing from another a fact that Defendant knows may justifiably induce the other to act or refrain from acting in a business transaction, (2) which is material to the transaction at hand; (3) with the intent of misleading another into relying on it; (4) justifiable reliance; and (5) the resulting injury was proximately caused by the reliance. LEM 2Q, LLC v. Guar. Nat’l Title Co., 144 A.3d 174, 181 & n.11 (Pa. Super. Ct. 2016) (citing Restatement (Second) of Torts § 551); Youndt v. First Nat’l Bank of Port Allegany, 868 A.2d 539, 550 (Pa. Super. Ct. 2005) (citing Restatement (Second) of Torts § 551); Gnagey, 82 A.3d at 501; Rissmiller, 2018 WL 4203839, at *3; In re Gen. Motors LLC, 257 F. Supp. 3d at 442–43; Aetna, 2015 WL 9460072, at *4.

Rhode Island Active concealment of material facts is actionable without proof of duty to disclose. Tavares v. Aramark Corp., 841 A.2d 1124, 1135 (R.I. 2004). Elements: (1) The defendant actively concealed a material fact, (2) intending thereby to induce plaintiff to rely thereon, and (3) the plaintiff justifiably relied thereon to his or her damage. W. Reserve Life Assur. Co. of Ohio v. Caramadre, 847 F. Supp. 2d 329, 337 (D.R.I. 2012), aff’d sub nom. W. Reserve Life Assur. Co. of Ohio v. ADM Assocs., LLC, 793 F.3d 168 (1st Cir. 2015); R.I. Civ. Jury Inst. 2506; Tavares, 841 A.2d at 1135.

South Carolina Active concealment of material facts is actionable without proof of duty to disclose. Finley v. Dalton, 164 S.E.2d 763, 767 (S.C. 1968); Holly Hill Lumber Co. v. McCoy, 23 S.E.2d 372, 378 (S.C. 1942). Elements: (1) Active concealment of a material fact, (2) its falsity, (3) its materiality, (4) either knowledge of its falsity or a reckless disregard of its truth or falsity, (5) intent that the nondisclosure be acted upon, (6) the hearer’s ignorance of its falsity, (7) the hearer’s reliance on its truth, (8) the hearer’s right to rely thereon, and (9) the hearer’s consequent and proximate injury. Kiriakides v. Atlas Food Sys. & Servs., Inc., 527 S.E.2d 371 (S.C. Ct. App. 2000), aff’d as modified on other grounds, 541 S.E.2d 257 (S.C. 2001); Finley, 164 S.E.2d at 767; Holly Hill, 23 S.E.2d at 378.

South Dakota A duty to disclose is not required for a claim by a contracting party for actual fraud by suppression of facts. Stern Oil Co. v. Brown, 817 N.W.2d 395, 400 & n.5 (S.D. 2012); S.D. Codified Laws § 53-4-5(3) (claim for actual fraud by contracting party includes “suppression of that which is true by one having knowledge or belief of the fact”).


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State Elements No duty to disclose is required, unlike a claim for deceit by a non-contracting party. S.D. Codified Laws 2-10-2(3) (claim for deceit by non-contracting party includes the “suppression of a fact by one who is bound to disclose it”). Elements: (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) with intent to deceive another party thereto or to induce him to enter into the contract; (4) materiality; (5) justifiable reliance; and (6) actual damages proximately caused by the nondisclosure. Stern Oil, 817 N.W.2d at 400 & n.5; S.D. Codified Laws § 53-4-5(3).

Tennessee Active concealment of material facts is actionable without proof of duty to disclose. Benton v. Snyder, 825 S.W.2d 409, 414 (Tenn. 1992). Elements: (1) The defendant actively concealed or suppressed a material fact; (2) the defendant intentionally and actively concealed or suppressed the fact with the intent to deceive the plaintiff; (4) the plaintiff was not aware of the fact and would have acted differently if the plaintiff knew of the actively concealed or suppressed fact; and (5) as a result of the active concealment or suppression of the fact, the plaintiff sustained damage. Tenn. Pattern Inst. Civil § 8.38; Benton, 825 S.W.2d at 414.

Texas Active concealment of material facts is actionable without proof of duty to disclose. Campbell v. Booth, 526 S.W.2d 167, 172 (Tex. Civ. App. 1975); Texas Pattern Jury Instruction 105.4 note. Elements: (1) The defendant actively and deliberately failed to disclose material facts; (2) the plaintiff was ignorant of the facts and did not have an equal opportunity to discover them; (3) the defendant intended the plaintiff to act or refrain from acting based on the active concealment; and (5) the plaintiff relied on the active concealment, which resulted in injury. Bombardier Aero. Corp. v. SPEP Aircraft Holdings, LLC, 2019 WL 406075, at *3 (Tex. Feb. 1, 2019); Campbell, 526 S.W.2d at 172.

Utah Active concealment of material facts is actionable without proof of duty to disclose. Bennett v. Bowen, 238 P. 240, 244 (Utah 1925). Elements: (1) The active concealment of a material fact, (2) for the purpose of inducing action on the part of the other party, (3) with actual, justifiable reliance, (4) resulting in damage to that party. Precision Vascular Sys., Inc. v. Sarcos, L.C., 199 F. Supp. 2d 1181, 1191 (D. Utah 2002) (citing Taylor v. Gasor, Inc., 607 P.2d 293, 294 (Utah 1980)); Bennett, 238 P. at 244.

Vermont Active concealment of material facts is actionable without proof of duty to disclose. Newell Bros. v. Hanson, 123 A. 208, 210 (Vt. 1924).


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State Elements Elements: (1) Active concealment of facts, (2) affecting the essence of the transaction, (3) not open to the defrauded party’s knowledge, (4) by one with knowledge and a duty to disclose, (5) with the intent to mislead, and (6) detrimental reliance by the defrauded party. Fuller v. Banknorth Mortg. Co., 788 A.2d 14, 16 (Vt. 2001); Newell, 123 A. at 210.

Virginia Active concealment of material facts is actionable without proof of duty to disclose. Devine v. Buki, 767 S.E.2d 459, 466 (Va. 2015); Spence v. Griffin, 372 S.E.2d 595, 599 (Va. 1988); Van Deusen v. Snead, 441 S.E.2d 207, 209–10 (Va. 1994). Elements: (1) The defendant’s active concealment of material facts (2) that he knows may justifiably induce the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these actively concealed material facts, (4) reliance by the party misled, and (5) resulting damage to the party misled. State Farm Mut. Auto. Ins. Co. v. Remley, 618 S.E.2d 316, 320–21 (Va. 2005); Restatement (Second) of Torts § 551 (cited by Ware v. Scott, 257 S.E.2d 855, 858 n.3 (1979)); Devine, 767 S.E.2d at 466; Spence, 372 S.E.2d at 599; Van Deusen, 441 S.E.2d at 209–10.

Washington Active concealment of material facts is actionable without proof of duty to disclose. Giraud v. Quincy Farm & Chem., 6 P.3d 104, 110 (Wash. Ct. App. 2000). Elements: (1) Active concealment of a fact; (2) materiality; (3) falsity; (4) the speaker’s knowledge of falsity; (5) intent of the speaker that it should be acted upon by the plaintiff; (6) plaintiff’s ignorance of its falsity; (7) plaintiff’s reliance; (8) plaintiff’s right to rely upon it; and (9) damages suffered by the plaintiff. Adams v. King Cty., 192 P.3d 891, 902 (Wash. 2008); Schreiner Farms, Inc. v. Am. Tower, Inc., 293 P.3d 407, 412 (Wash. Ct. App. 2013); Giraud, 6 P.3d at 110.

West Virginia Active concealment of material facts is actionable without proof of duty to disclose. Kessel v. Leavitt, 511 S.E.2d 720, 753 (W. Va. 1998). Elements: (1) Active concealment of material facts; (2) intention to mislead or defraud; (3) plaintiff relied upon it and was justified under the circumstances in relying upon it; and (4) plaintiff was damaged because he relied upon it. Trafalgar House Constr., Inc. v. ZMM, Inc., 567 S.E.2d 294, 300 (W. Va. 2002); Kessel, 511 S.E.2d at 753.

Wisconsin Active concealment of material facts is actionable without proof of duty to disclose. Ollerman v. O’Rourke Co., 288 N.W.2d 95, 102 (Wis. 1980).


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State Elements Elements: (1) a representation of material fact; *2) the representation’s falsity; (3) the intent to deceive (or reckless disregard for truth or falsity); (4) intent to defraud or to induce action; (5) justifiable reliance by the deceived party. State v. Abbott Labs., 816 N.W.2d 145, 161 (Wis. 2012); Ollerman, 288 N.W.2d at 102.

Wyoming Active concealment of material facts is actionable without proof of duty to disclose. Sundown, Inc. v. Pearson Real Estate Co., 8 P.3d 324, 333 (Wyo. 2000). Elements: (1) Active concealment of a material fact, (2) made with intent to deceive the plaintiff in order to induce the plaintiff to act on it to plaintiff’s pecuniary damage; and (3) plaintiff’s detrimental reliance. Schmidt v. Bassett Furniture Indus., 2009 WL 3380354, at *10 (E.D. Wis. Oct. 20, 2009); Sundown, 8 P.3d at 333.


APPENDIX 3


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Chart for burden of proof for common-law fraud

State Burden of proof for fraud Alabama Preponderance of the evidence. Ala. Pattern Jury Instr. Civ. 18.01

(“reasonable satisfaction” burden of proof for fraud); McBride v. Karumanchi, 2015 WL 4477352, at *3 (M.D. Ala. July 22, 2015) (“Reasonable satisfaction … is interchangeable with preponderance of the evidence.”).

Alaska Preponderance of the evidence. Dairy Queen of Fairbanks, Inc. v. Travelers Indem. Co. of Am., 748 P.2d 1169, 1171 (Alaska 1988).

Arizona Clear and convincing evidence. Am. Pepper Supply Co. v. Fed. Ins. Co., 93 P.3d 507, 509 (Ariz. 2004).

Arkansas Preponderance of the evidence. Tyson Foods, Inc. v. Davis, 66 S.W.3d 568, 580 (Ark. 2002).

California Preponderance of the evidence. Liodas v. Sahadi, 19 Cal. 3d 278, 286–293 (1977).

Colorado Preponderance of the evidence. Colorado Jury Instruction 19:1; Snyder v. Colo. Podiatry Bd., 100 P.3d 496, 502 (Colo. Ct. App. 2004).

Connecticut Clear and convincing evidence. Stuart v. Freiberg, 116 A.3d 1195, 1203-04 (Conn. 2015).

Delaware Preponderance of the evidence. Triple H Family Ltd. P’ship v. Neal, 2018 WL 3650242, at *16 (Del. Ch. Ct. July 31, 2018).

Florida Preponderance of the evidence. Wieczoreck v. H&H Builders, Inc., 475 So. 2d 227, 288 (Fla. 1985).

Georgia Preponderance of the evidence. Bloodworth v. Bloodworth, 626 S.E.2d 589, 591 (Ga. Ct. App. 2006).

Hawaii Clear and convincing evidence. Kekona v. Abastillas, 150 P.3d 823, 830 (Haw. 2006).

Idaho Clear and convincing evidence. Country Cove Dev., Inc. v. May, 150 P.3d 288 (Idaho 2006).

Illinois Clear and convincing. Avery v. State Farm Mut. Auto. Ins. Co., 835 N.E.2d 801, 856 (Ill. 2005).

Indiana Preponderance of the evidence. Civ. Jury Inst. 3101; Ohio Framers Ins. Co. v Ind. Drywall & Acoustics, Inc., 970 N.E.2d 674, 683 (Ind. Ct. App. 2012).

Iowa Clear and convincing evidence. Clark v. McDaniel, 546 N.W.2d 590, 592 (Iowa 1996).

Kansas Clear and convincing evidence. Kelly v. VinZant, 197 P.3d 803, 808 (Kan. 2008).

Kentucky Clear and convincing evidence. Yung v. Grant Thornton, LLP, 563 S.W.3d 22, 45 (Ky. 2018).

Louisiana Preponderance of the evidence. La. Civ. Code art. 1957. Maine Clear and convincing. Harris Mgmt., Inc. v. Coulombe, 151 A.3d 7, 16 n.7

(Me. 2016).


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State Burden of proof for fraud Maryland Clear and convincing. Exxon Mobil Corp. v. Albright, 71 A.3d 30, 49 (Md.

2013). Massachusetts Preponderance of the evidence. Hisert v. Blue Waters Dredging, LLC, 2018

WL 6025653, at *7 (D. Mass. Nov. 16, 2018). Michigan Clear, satisfactory, and convincing evidence. State ex rel. Gurganus v. CVS

Caremark Corp., 852 N.W.2d 103, 112 n.40 (Mich. 2014). Minnesota Clear and convincing evidence. Christie v. Estate of Christie, 911 N.W.2d

833 (Minn. 2018). Mississippi Clear and convincing evidence. Terry v. Oby T. Rogers, PLLC, 256 So. 3d

1175, 1180 (Miss. 2018). Missouri Clear and convincing evidence. Hammett v. Atcheson, 438 S.W.3d 452, 461

(Mo. Ct. App. 2014). Montana Preponderance of the evidence. In re Estate of Kindsfather, 108 P.3d 487, 490

(Mont. 2005). Nebraska Preponderance of the evidence. deNouri & Yost Homes, LLC v. Frost, 854

N.W.2d 298, 305, 319 (Neb. 2014). Nevada Clear and convincing evidence. Barmettler v. Reno Air, Inc., 956 P.2d 1382,

1386 (Nev. 1998). New Hampshire Clear and convincing evidence. Hair Excitement, Inc. v. L’Oreal U.S.A., Inc.,

965 A.2d 1032, 1038 (N.H. 2009). New Jersey Clear and convincing evidence. Vance v. Scerbo, 2019 WL 960245, at *5

(N.J. Super. Ct. App. Div. Feb. 26, 2019). New Mexico Clear and convincing evidence. In re Convisser, 242 P.3d 299, 307 (N.M.

2010). New York Clear and convincing evidence. Gaidon v. Guardian Life Ins. Co. of Am., 725

N.E.2d 598, 607 (N.Y. 1999). North Carolina Preponderance of the evidence. N.C.P.I. Civil Jury Inst. 800.00; Southstar

Funding, LLC v. Rhodes, 2007 WL 9718431, at *3 (E.D.N.C. Mar. 20, 2007). North Dakota Clear and convincing evidence. Freidig v. Weed, 868 N.W.2d 546, 550 (N.D.

2015). Ohio Preponderance of the evidence. Household Fin. Corp. v. Altenberg, 514

N.E.2d 667, 668 (Ohio 1966). Oklahoma Clear and convincing evidence. OUJI-CIV No. 18.1; Online Oil, Inc. v.

CO&G Prod. Grp., LLC, 419 P.3d 337, 350 (Okla. Civ. App. 2017). Oregon Clear and convincing evidence. Peterson v. McCavic, 277 P.3d 572, 580 (Or.

Ct. App. 2012). Pennsylvania Clear and convincing evidence. Office of Disciplinary Counsel v. Kiesewetter,

889 A.2d 47, 54 n.5 (Pa. 2005). Rhode Island Preponderance of the evidence. Ostalkiewicz v. Guardian Alarm, Div. of

Colbert’s Sec. Servs., Inc., 520 A.2d 563, 569 (R.I. 1987). South Carolina Clear and convincing evidence. Turner v. Milliman, 708 S.E.2d 766, 770

(S.C. 2011). South Dakota Preponderance of the evidence. Sejnoha v. City of Yankton, 622 N.W.2d 735,

739 (S.D. 2001).


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State Burden of proof for fraud Tennessee Preponderance of the evidence. D’Alessandro v. Lake Developers, II, LLC,

2012 WL 1900543, at *8 n.4 (Tenn. Ct. App. May 25, 2012). Texas Preponderance of the evidence. In re Oluyemisi Omokafe Okedokun, 593 B.R.

469, 540 (Bankr. S.D. Tex. 2018). Utah Clear and convincing evidence. Daines v. Vincent, 190 P.3d 1269, 1279 (Utah

2008). Vermont Clear and convincing evidence. Kneebinding, Inc. v. Howell, 201 A.3d 326,

369 (Vt. 2018). Virginia Clear and convincing evidence. Sweely Holdings, LLC v. Suntrust Bank, 820

S.E.2d 596, 604 (Va. 2018). Washington Clear, cogent, and convincing evidence. Baker Boyer Nat’l Bank v. Foust,

436 P.3d 382, 386 (Wash. Ct. App. 2018). West Virginia Clear and convincing evidence. Quicken Loans, Inc. v. Brown, 737 S.E.2d

640, 653 (W. Va. 2012). Wisconsin Clear and convincing evidence. Williams v. Rank & Son Buick, Inc., 170

N.W.2d 807, 809 (Wis. 1969). Wyoming Clear and convincing evidence. Alexander v. Meduna, 47 P.3d 206, 216

(Wyo. 2002).


APPENDIX 4


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State-law claim for fraud by nondisclosure – elements and proof of duty to disclose

State Elements and proof of duty to disclose Alabama Elements. (1) A duty on the part of the defendant to disclose facts; (2) concealment or nondisclosure of material

facts by the defendant; (3) inducement of the plaintiff to act; (4) action by the plaintiff in reasonable reliance thereon to his or her injury. CHN Am. LLC v. Ligon Capital LLC, 160 So. 3d 1195 (Ala. 2013); Johnson v. Sorensen, 914 So. 2d 830, 837 (Ala. 2005). Duty to disclose. (1) Partial, misleading disclosure. Aliant Bank v. Four Star Invs., Inc., 244 So. 3d 896, 932 (Ala. 2017); Hardie-Tynes, Co. v. SKF USA, Inc., 2018 WL 2229806, at *7 (N.D. Ala. May 16, 2018). (2) Superior knowledge. Hardie-Tynes, 2018 WL 2229806, at *18.

Alaska Elements. (1) The defendant’s omission of fact, where there is a duty to disclose, (2) made fraudulently (that is, with scienter), (3) for the purpose or with the expectation of inducing another to act in reliance, (4) with justifiable reliance by the recipient, (5) causing loss. Recreational Data Servs., Inc. v. Trimble Navigation Ltd., 404 P.3d 120, 126 (Alaska 2017), cert. denied, 138 S. Ct. 1272 (2018). Duty to disclose. (1) Restatement (Second) of Torts § 551. Deptula v. Simpson, 164 P.3d 640, 645 (Alaska 2007); Ryll Int’l, LLC v. Drake Bros. Trucking, Inc., 2010 WL 11619558, at *3 (D. Alaska Aug. 6, 2010); Alaska Jury Inst. § 17.07. (2) Partial, misleading disclosure. Wasser & Winters Co. v. Ritchie Bros. Auctioneers (Am.), Inc., 185 P.3d 73, 81 (Alaska 2008); Lightle v. State, Real Estate Comm’n, 146 P.3d 980, 986 (Alaska 2006).

Arizona Elements. (1) The concealment of a material existing fact that in equity and good conscience should be disclosed; (2) knowledge on the part of the party against whom the claim is asserted that such a fact is being concealed; (3) ignorance of that fact on the part of the one from whom the fact is concealed; (4) the intention that the concealment be acted upon; and (5) action on the concealment resulting in damages. Insight Pub. Sector, Inc. v. Proteam Sols., Inc., 2016 WL 6648167, at *7 n.39 (D. Ariz. Nov. 10, 2016). Duty to disclose. (1) Restatement (Second) of Torts § 551. Wells Fargo Bank v. Ariz. Laborers, Teamsters & Cement Masons Local No. 395, 38 P.3d 12, 34 n.22 (Ariz. 2002); Sunstate Equip. Co., LLC v. Davis, 2019 WL 1499854, at *3 (Ariz. Ct. App. Apr. 4, 2019); Ventures Edge Legal PLLC v. GoDaddy.com, 2016 WL 3570465, at *3 (D. Ariz. July 1, 2016).

Arkansas Elements. (1) Concealment of a material matter known to the party and which it is the party’s legal duty to communicate; (2) intent to induce action or inaction in reliance upon the concealed matter; (3) justifiable reliance on


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State Elements and proof of duty to disclose the concealed matter; and (4) damages suffered as a result of the reliance. Adeli v. Silverstar Auto., Inc., 2018 WL 4374194, at *7 (W.D. Ark. Sept. 13, 2018). Duty to disclose. (1) Restatement (Second) of Torts § 551. Baskin v. Collins, 806 S.W.2d 3, 5 (Ark. 1991). (2) Superior knowledge. Bridges v. United Sav. Ass’n, 438 S.W.2d 303, 306 (Ark. 1969); Merrill Lynch, Pierce, Fenner & Smith, Inc. v. First Nat’l Bank of Little Rock, 774 F.2d 909, 913–14 (8th Cir. 1985).

California Elements. (1) Concealment or suppression of a material fact; (2) by a defendant with a duty to disclose the fact to the plaintiff; (3) the defendant intended to defraud the plaintiff by intentionally concealing or suppressing the fact; (4) the plaintiff was unaware of the fact and would not have acted as he or she did if he or she had known of the concealed or suppressed fact; and (5) plaintiff sustained damage as a result of the concealment or suppression of the fact. Dent v. NFL, 902 F.3d 1109, 1125 (9th Cir. 2018). Duty to disclose. (1) Superior knowledge. Hodson v. Mars, Inc., 891 F.3d 857, 862 (9th Cir. 2018). (2) Partial, misleading disclosure. Hodson, 891 F.3d at 862.

Colorado Elements. (1) The concealment of a material existing fact that in equity and good conscience should be disclosed; (2) knowledge on the part of the party against whom the claim is asserted that such a fact is being concealed; (3) ignorance of that fact on the part of the one from whom the fact is concealed; (4) the intention that the concealment be acted upon; and (5) action on the concealment resulting in damages. Spring Creek Expl. & Prod. Co. v. Hess Bakken Inv., II, LLC, 887 F.3d 1003, 1020 (10th Cir. 2018); Baker v. Wood, Ris & Hames, PC, 364 P.3d 872, 883 (Colo. 2016); BP Am. Prod. Co. v. Patterson, 263 P.3d 103, 109 (Colo. 2011). Duty to disclose. (1) Restatement (Second) of Torts § 551. Mallon Oil Co. v. Bowen/Edwards Assocs., Inc., 965 P.2d 105, 111 (Colo. 1998); In re Rumsey Land Co., LLC, 2018 WL 5312883, at *7–8 (D. Colo. Oct. 26, 2018); Colo. Jury Inst.-Civ 19:5. (2) Superior knowledge. In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19 (D.N.J. May 8, 2017).

Connecticut Elements. (1) The failure to make a full and fair disclosure of material facts connected with a matter about which the defendant has assumed to speak, under circumstances in which there is a duty to speak; (2) the defendant knew that the facts were not being disclosed; (3) the nondisclosure was intended to induce the other party to act; and (4) the other party did so act upon the undisclosed facts to his injury. Stuart v. Freiberg, 116 A.3d 1195, 1203-04 (Conn. 2015); Reville v. Reville, 93 A.3d 1076, 1087 (Conn. 2014).


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State Elements and proof of duty to disclose Duty to disclose. (1) Superior knowledge. In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19. (2) Partial, misleading disclosure. Duksa v. City of Middletown, 376 A.2d 1099, 1101 (Conn. 1977).

Delaware Elements. (1) Deliberate concealment by the defendant of a material past or present fact, or silence in the face of a duty to speak; (2) That the defendant acted with scienter; (3) An intent to induce plaintiff’s reliance upon the concealment; (4) Causation; and (5) Damages resulting from the concealment. In re Temporomandibular Joint (TMJ) Implants Prods. Liab. Litig., 113 F.3d 1484, 1497 (8th Cir. 1997) (citing Nicolet, Inc. v. Nutt, 525 A.2d 146, 149 (Del. 1987)). Duty to disclose. (1) Restatement (Second) of Torts § 551. Matthews Office Designs, Inc. v. Taub Invs., 647 A.2d 382 (Del. 1993); In re Student Fin. Corp., 2004 WL 609329, at *5 (D. Del. Mar. 23, 2004).

Florida Elements. (1) The defendant concealed or failed to disclose a material fact; (2) the defendant knew or should have known the material fact should be disclosed; (3) the defendant knew that its concealment of or failure to disclose the material fact would induce the plaintiff to act; (4) the defendant had a duty to disclose the material fact; and (5) the plaintiff detrimentally relied on the misinformation. Hess v. Philip Morris USA, Inc., 175 So. 3d 687, 691 (Fla. 2015); Cote v. R.J. Reynolds Tobacco Co., 909 F.3d 1094, 1106 n.6 (11th Cir. 2018). Duty to disclose. (1) Superior knowledge. Hauben v. Harmon, 605 F.2d 920, 924 (5th Cir. 1979); Coffey v. WCW & Air, Inc., 2018 WL 4154256, at *4 (N.D. Fla. Aug. 30, 2018); Cohen v. Nat’l City Mortg., 2009 WL 2436595, at *3 (M.D. Fla. Aug. 6, 2009); Nessim v. De Loache, 384 So. 2d 1341, 1344 (Fla. Dist. Ct. App. 1980). (2) Partial, misleading disclosure. Cafaro v. Zois, 693 F. App’x 810, 816 (11th Cir. 2017); ZC Ins. Co. v. Brooks, 847 So. 2d 547, 551 (Fla. Dist. Ct. App. 2003); In re Palm Ave. Partners, LLC, 576 B.R. 239, 251 (Bankr. M.D. Fla. 2017).

Georgia Elements. (1) Omission of a material fact; (2) scienter; (3) intention to induce the party claiming fraud to act or refrain from acting; (4) justifiable reliance; and (5) damages. Rampura, LLC v. Main & 75 Ctr., LLC, 2008 WL 3861203, at *9 (N.D. Ga. Feb. 13, 2008). Duty to disclose. (1) Concealment of material facts. Persad v. Ford Motor Co., 2018 WL 3428690, at *3 (E.D. Mich. July 16, 2018); Amin v. Mercedes-Benz USA, LLC, 301 F. Supp. 3d 1277, 1296 (N.D. Ga. 2018); Apex Bank v. Ameris Bank, Inc., 2017 WL 10574244, at *5 (N.D. Ga. July 17, 2017); McCabe v. Daimler AG, 948 F. Supp. 2d 1347, 1368 (N.D. Ga. 2013).

Hawaii Elements. (1) The defendant’s omission of material facts, (2) that he knows may justifiably induce the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these false omitted


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State Elements and proof of duty to disclose material facts, and (4) plaintiff did justifiably rely upon them to his damage. Tauese v. State, Dep’t of Labor & Indus. Relations, 147 P.3d 785, 821 (Haw. 2006); Santiago v. Tanaka, 366 P.3d 612, 624 (Haw. 2016). Duty to disclose. (1) Restatement (Second) of Torts § 551. Santiago v. Tanaka, 366 P.3d 612, 624 (Haw. 2016); Molokoa Vill. Dev. Co. v. Kauai Elec. Co., 593 P.2d 375, 381 (Haw. 1979); Pancakes of Hawaii, Inc. v. Pomare Props. Corp., 944 P.2d 97, 115 (Haw. Ct. App. 1997); Sung v. Hamilton, 710 F. Supp. 2d 1036, 1047 (D. Haw. 2010).

Idaho Elements. (1) A nondisclosure; (2) a duty to speak; (3) reliance on the nondisclosure; (4) the reliance was material to the transaction; and (5) damage as a proximate result of the nondisclosure. Watts v. Krebs, 962 P.2d 387, 390 (Idaho 1998). Duty to disclose. (1) Restatement (Second) of Torts § 551. O’Shea v. High Mark Dev., LLC, 280 P.3d 146, 156 n.4 (Idaho 2012); Hudson v. Cobbs, 797 P.2d 1322, 1331 (Idaho 1990).

Illinois Elements. (1) The defendant concealed a material fact under circumstances that created a duty to speak; (2) the defendant intended to induce a false belief; (3) the plaintiff could not have discovered the truth through reasonable inquiry or inspection, or was prevented from making a reasonable inquiry or inspection, and justifiably relied upon the defendant’s silence as a representation that the fact did not exist; (4) the concealed information was such that the plaintiff would have acted differently had he or she been aware of it; and (5) the plaintiff’s reliance resulted in damages. Abazari v. Rosalind Franklin Univ. of Med. & Sci., 40 N.E.3d 264, 274 (Ill. App. Ct. 2015). Duty to disclose. (1) Superior knowledge. Ill. Cent. Gulf R. Co. v. Dep’t of Local Gov. Affairs, 523 N.E.2d 1048, 1052 (Ill. App. Ct. 1988) (“fraud may be found if one party with superior knowledge and access to material facts fails to disclose them”). (2) Partial, misleading disclosure. Buechin v. Ogden Chrysler-Plymouth, Inc., 511 N.E.2d 1330, 1336 (Ill. App. Ct. 1987) (“a statement, although technically true, may nevertheless be fraudulent where it omits qualifying materials, for a half-truth is sometimes more misleading than an outright lie”).

Indiana Elements. (1) The wrongdoer had a duty to disclose certain facts to another, (2) it knowingly failed to do so, and (3) the other justifiably relied upon such non-disclosure to his detriment. Rose v. NCAA, 346 F. Supp. 3d 1212, 1225 (N.D. Ill. 2018) (citing DeVoe Chevrolet-Cadillac, Inc. v. Cartwright, 526 N.E.2d 1237, 1240 (Ind. Ct. App. 1988)). Duty to disclose. (1) Restatement (Second) of Torts § 551. Crum v. AVCO Fin. Servs. of Indianapolis, Inc., 552 N.E.2d 823, 830 n.6 (Ind. Ct. App. 1990); Midwest Commerce Banking Co. v. Elkhart City Ctr., 4 F.3d 521, 524 (7th Cir. 1993). (2) Superior knowledge. Northrop Corp. v. GMC, 807 N.E.2d 70, 87 (Ind. Ct. App. 2004); Rose, 346 F.


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State Elements and proof of duty to disclose Supp. 3d at 1225; Fifth Third Bank v. Double Tree Lake Estates, LLC, 2013 WL 587889, at *7 (N.D. Ind. Feb. 12, 2013).

Iowa Elements. (1) Failure to disclose when under a legal duty to do so, (2) materiality, (3) scienter, (4) intent to deceive, (5) justifiable reliance, and (6) resulting injury or damage. Clark v. McDaniel, 546 N.W.2d 590, 592 (Iowa 1996). Duty to disclose. (1) Restatement (Second) of Torts § 551(b), (c). Wright v. Brooke Grp. Ltd., 652 N.W.2d 159, 177 (Iowa 2002). (2) Superior knowledge. City of Ottumwa v. Poole, 687 N.W.2d 266, 269 (Iowa 2004); Capson Physicians Ins. Co. v. MMIC Ins. Inc., 829 F.3d 951, 957 (8th Cir. 2016).

Kansas Elements. (1) Defendant had knowledge of material facts which plaintiff did not have and which plaintiff could not have been discovered by the exercise of reasonable diligence; (2) defendant was under an obligation to communicate the material facts to the plaintiff; (3) defendant intentionally failed to communicate to plaintiff the material facts; (4) plaintiff justifiably relied on defendant to communicate the material facts to plaintiff; and (5) plaintiff sustained damages as a result of defendant’s failure to communicate the material facts to the plaintiff. Miller v. Sloan, Listrom, Eisenbarth, Sloan & Glassman, 978 P.2d 922, 932–33 (Kan. 1999); In re Estate of Pritchard, 154 P.3d 24, 33 (Kan. Ct. App. 2007). Duty to disclose. (1) Restatement (Second) of Torts § 551. Griffith v. Byers Constr. Co., 510 P.2d 198 (Kan. 1973); Bank of Am., N.A. v. Narula, 261 P.3d 898, 911 (Kan. Ct. App. 2011). (2) Superior knowledge. In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19.

Kentucky Elements. (1) The defendant had a duty to disclose the material fact at issue; (2) the defendant failed to disclose the fact; (3) the defendant’s failure to disclose the material fact induced the plaintiff to act; and (4) the plaintiff suffered actual damages as a consequence. Giddings v. Lewis, Inc. v. Indus. Risk Insurers, 348 S.W.3d 729, 747 (Ky. 2011). Duty to disclose. (1) Superior knowledge. Morris Aviation, LLC v. Diamond Aircraft Ind., Inc., 536 F. App’x 558, 568 (6th Cir. 2013) (citing Giddings v. Lewis, Inc. v. Indus. Risk Insurers, 348 S.W.3d 729, 747–748 (Ky. 2011)). (2) Partial, misleading disclosure. Morris Aviation, 536 F. App’x at 568 (citing Giddings, 348 S.W.3d at 747–748).

Louisiana Elements. (1) An omission of a material fact where the defendant owed a duty to the plaintiff to disclose the information; (2) made with intent to deceive; and (3) causing justifiable reliance with resultant injury. Kadlec Med. Ctr. v. Lakeview Anesthesia Assocs., 527 F.3d 412, 418 (5th Cir. 2008). Duty to disclose. (1) Superior knowledge. In re Ford Motor Co. Vehicle Paint Litig., 1997 WL 539665, at *4 (E.D. La. 1997). (2) Partial, misleading disclosure. Kadlec Med. Ctr., 527 F.3d at 419. (3) Conceals intrinsic defect. First


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State Elements and proof of duty to disclose Am. Bankcard, Inc. v. Smart Bus. Tech., Inc., 178 F. Supp. 3d 390, 401–402 (E.D. La. 2016); In re Ford Motor Co. Vehicle Paint Litig., 1997 WL 539665, at *4.

Maine Elements. (1) A failure to disclose; (2) a material fact; (3) where a legal or equitable duty to disclose exists; (4) with the intention of inducing another to act or to refrain from acting in reliance on the non-disclosure; and (5) which is in fact relied upon to the aggrieved party’s detriment. Barr v. Dyke, 49 A.3d 1280, 1287 (Me. 2012). Duty to disclose. (1) Partial, misleading disclosure. Bradley v. Kryvicky, 574 F. Supp. 2d 210, 220 (D. Me. Aug. 29, 2008). (2) Active concealment. Noveletsky v. Metro. Life Ins. Co., 2013 WL 2945058, at *9 (D. Me. June 14, 2013).

Maryland Elements. (1) The defendant owed a duty to the plaintiff to disclose a material fact; (2) the defendant failed to disclose that fact; (3) the defendant intended to defraud or deceive the plaintiff; (4) the plaintiff took action in justifiable reliance on the concealment; and (5) the plaintiff suffered damages as a result of the defendant’s concealment. Blondell v. Littlepage, 991 A.2d 80, 94 (Md. 2010). Duty to disclose. (1) Superior knowledge. In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19. (2) Partial, misleading disclosure. Lloyd v. GMC, 916 A.2d 257, 274 n.11 (Md. 2007); Lubore v. RPM Assocs., 674 A.2d 547, 556 (Md. Ct. Spec. App. 1996).

Massachusetts Elements. (1) Defendant has a duty to disclose; (2) defendant suppresses a material fact; (3) defendant’s suppression of the material fact induces plaintiff to act or to refrain from acting; and (4) plaintiff suffers actual damage as a proximate result. Peters v. Amoco Oil Co., 57 F. Supp. 2d 1268, 1281 (M.D. Ala. 1999) (citing Nota Constr. Corp. v. Keyes Assoc., Inc., 694 N.E.2d 401, 404 (Mass. Ct. App. 1998)). Duty to disclose. (1) Restatement (Second) of Torts § 551. Bhammer v. Loomis, Sayles & Co., 2016 WL 3892371, at *5–6 (D. Mass. July 14, 2016); Nota Constr. Corp. v. Keyes Assocs., 694 N.E.2d 401, 404–05 (Mass. Ct. App. 1998).

Michigan Elements. (1) Defendant failed to disclose a material fact; (2) defendant had actual knowledge of the fact; (3) defendant’s failure to disclose the fact caused plaintiff to have a false impression; (4) when defendant failed to disclose the fact, defendant knew the failure would create a false impression; (5) when defendant failed to disclose the fact, defendant intended that plaintiff rely on the resulting false impression; (6) plaintiff relied on the false impression; (7) plaintiff was damaged as a result of that reliance. United States Fid. & Guar. Co. v. Black, 313 N.W.2d 77 (Mich. 1981); Mich. Model Civil Jury Inst. 128.02.


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State Elements and proof of duty to disclose Duty to disclose. (1) Partial, misleading disclosure. People v. Atkins, 243 N.W.2d 292, 300 & n.6 (Mich. 1976); M & D, Inc. v. W.B. McConkey, 585 N.W.2d 33, 40 (Mich. Ct. App. 1998); Loffredo v. Daimler AG, 500 F. App’x 491, 497 (6th Cir. 2012); Rivet v. State Farm Mut. Auto. Ins. Co., 316 F. App’x 440, 446 (6th Cir. 2009).

Minnesota Elements. (1) A party conceals a fact material to a transaction; (2) the fact is peculiarly within the concealing party’s knowledge, (3) the concealing party knows the other party will act on the presumption that no such fact exists, and (4) the concealing party has a legal or equitable duty to communicate the fact. Powell v. Trans Global Tours, Inc., 594 N.W.2d 252, 256 (Minn. Ct. App. 1999). Duty to disclose. (1) Restatement (Second) of Torts § 551. Cty. of Hennepin v. AFG Indus., Inc., 726 F.2d 149, 153 n.5 (8th Cir. 1984); Gerdin v. Princeton State Bank, 371 N.W.2d 5 (Minn. Ct. App. 1985). (2) Superior knowledge. Graphic Commc’n Local 1B Health & Welfare Fund “A” v. CVS Caremark Corp., 850 N.W.2d 682, 695 (Minn. 2014); Podpeskar v. Makita U.S.A. Inc., 247 F. Supp. 3d 1001, 1011 (D. Minn. 2017).

Mississippi Elements. (1) A misrepresentation or silence relating to a material fact or matter known to the party and as to which it is his legal duty to communicate to the other contracting party, (2) its falsity, (3) its materiality, (4) the speaker’s knowledge of its falsity or ignorance of its truth, (5) his intent that it should be acted on by the hearer and in the manner reasonably contemplated, (6) the hearer’s ignorance of its falsity, (7) his reliance on its truth, (8) his right to rely thereon, and (9) his consequent and proximate injury. In order for there to be liability for nondisclosure. An affirmative act of concealment is necessary for fraudulent concealment. Mabus v. St. James Episcopal Church, 13 So. 3d 260, 264 (Miss. 2009). Duty to disclose. (1) Restatement (Second) of Torts § 551. Daniels v. Crocker, 235 So. 3d 1, 14–15 (Miss. 2017); Holman v. Howard Wilson Chrysler Jeep, Inc., 972 So. 2d 564, 568–569 (Miss. 2008).

Missouri Elements. (1) Silence in the face of a legal duty to speak, (2) materiality, (3) intent of the non-speaker that the decedent would act on the silence, (4) the decedent’s ignorance of the facts being concealed, (5) reliance, (6) the decedent’s right to rely, and (7) proximately-caused injury. Thompson v. R.J. Reynolds Tobacco Co., 2013 WL 12075969, at *3 (W.D. Mo. May 3, 2013) (citing Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 765 (Mo. 2007)). Duty to disclose. (1) Restatement (Second) of Torts § 551. Kesselring v. St. Louis Grp., Inc., 74 S.W.3d 809, 814 (Mo. Ct. App. 2002); Snelling v. HSBC Card Servs., Inc., 2015 WL 3621091, at *6 (E.D. Mo. June 9, 2015); Tension Envelope Corp. v. JBM Envelope Co., 2015 WL 893242, at *13 (W.D. Mo. Mar. 3, 2015), aff’d, 876 F.3d 1112 (8th


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State Elements and proof of duty to disclose Cir. 2017). (2) Superior knowledge. Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 765–66 (Mo. 2007).

Montana Elements. (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) the speaker’s intent that the suppressed fact should be acted upon by the person and in the manner reasonably contemplated; (4) the hearer’s ignorance of the truth; (5) the hearer’s reliance; (6) the hearer’s right to rely; and (7) the hearer’s consequent and proximate injury or damages caused by their reliance. Town of Geraldine v. Mont. Mun. Ins. Auth., 198 P.3d 796, 801 (Mont. 2008); Mont. Code Ann. § 28-2-405(3) (actual fraud by a contracting party includes “the suppression of that which is true by one having knowledge or belief of the fact”). No duty to disclose is required, unlike a claim for deceit by a non-contracting party. Town of Geraldine, 198 P.3d at 801; Mont. Code Ann. § 27-1-712(2)(c) (deceit by a non-contracting party includes “the suppression of a fact by one who is bound to disclose it”). Duty to disclose (not required for claim of actual fraud by contracting party). (1) Superior knowledge. Morrow v. Bank of Am., N.A., 324 P.3d 1167, 1184 (Mont. 2014). (2) Partial, misleading disclosure. Id.; Mont. Code Ann. § 27-1-712(2)(c).

Nebraska Elements. (1) The defendant had a duty to disclose a material fact; (2) the defendant, with knowledge of the material fact, concealed the fact; (3) the material fact was not within the plaintiff’s reasonably diligent attention, observation, and judgment; (4) the defendant concealed the fact with the intention that the plaintiff act or refrain from acting in response to the concealment or suppression; (5) the plaintiff, reasonably relying on the fact or facts as the plaintiff believed them to be as the result of the concealment, acted or withheld action; and (6) the plaintiff was damaged by the plaintiff’s action or inaction in response to the concealment. Knights of Columbus Council 3152 v. KFS BD, Inc., 791 N.W.2d 317, 334 (Neb. 2010). Duty to disclose. (1) Restatement (Second) of Torts § 551. Streeks, Inc. v. Diamond Hill Farms, Inc., 605 N.W.2d 110, 120 (Neb. 2000); Fid. & Deposit Co. of Md. v. Casey Indus., Inc., 2014 WL 1096355, at *9 (D. Neb. Mar. 19, 2014). (2) Partial, misleading disclosure. State ex rel. Nebraska State Bar Ass’n v. Douglas, 416 N.W.2d 515, 531 (Neb. 1987).

Nevada Elements. (1) The defendant concealed or suppressed a material fact; (2) the defendant was under a duty to disclose the fact to the plaintiff; (3) the defendant intentionally concealed or suppressed the fact with the intent to defraud the plaintiff; that is, the defendant concealed or suppressed the fact for the purpose of inducing the plaintiff to act differently than she would have if she had known the fact; (4) the plaintiff was unaware of the fact and would have acted differently if she had known of the concealed or suppressed fact; (5) and, as a result of the concealment or


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State Elements and proof of duty to disclose suppression of the fact, the plaintiff sustained damages. Rivera v. Philip Morris, Inc., 395 F.3d 1142, 1154 (9th Cir. 2005) (quoting Dow Chem. Co. v. Mahlum, 970 P.2d 98, 110 (Nev. 1998), overruled in part on other grounds, GES, Inc. v. Corbitt, 21 P.3d 11 (Nev. 2001)). Duty to disclose. (1) Restatement (Second) of Torts § 551. Boink Syst., Inc. v. Las Vegas Sands Corp., 2008 WL 11389198, at *6 (D. Nev. Dec. 10, 2008). (2) Superior knowledge. Dow Chem. Co. v. Mahlum, 970 P.2d 98, 110 (Nev. 1998); In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19.

New Hampshire

Elements. (1) The intentional concealment of a material fact; (2) made for the purpose of inducing another to act or refrain from action; (3) justifiable reliance; and (4) pecuniary loss. Tessier v. Rockefeller, 33 A.3d 1118, 1124 (N.H. 2011); Matter of Flickinger, 2008 WL 11258738, at *1 (N.H. Mar. 18, 2008); LeClerc v. Prudential Ins. Co., 39 A.2d 763 (N.H. 1944). Duty to disclose. (1) Superior knowledge. Shafmaster v. Shafmaster, 642 A.2d 1361, 1365 (N.H. 1994); In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19. (2) Partial, misleading disclosure. Ingaharro v. Blanchette, 440 A.2d 445, 447 (N.H. 1982); Dawe v. Am. Universal Ins. Co., 417 A.2d 2, 4 (N.H. 1980).

New Jersey Elements. (1) The defendant had a duty to disclose information to the plaintiff; (2) the information was material; (3) the plaintiff could not readily have learned of the information without the defendant disclosing it; (4) the defendant intentionally withheld, altered, or destroyed the information; and (5) the plaintiff suffered harm by relying on the non-disclosure. Steele v. Depuy Orthopaedics, Inc., 295 F. Supp. 2d 439, 456 (D.N.J. 2003). Duty to disclose. (1) Restatement (Second) of Torts § 551. Strawn by Strawn v. Canuso, 638 A.2d 141, 149 (N.J. Super. Ct. App. Div. 1994); In re Mercedes-Benz Emissions Litig., 2019 WL 413541, at * 23 (D.N.J. Feb. 1, 2019).

New Mexico Elements. (1) The defendant’s omission of material facts, (2) that he knows may justifiably induce the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these falsely omitted material facts, and (4) detrimental reliance and damages. Alfaro-Huitron v. WKI Outsourcing Sols., LLC, 2018 WL 522312, at *16 (D.N.M. Jan. 22, 2018); Restatement (First) of Torts § 551 (1938) (cited approvingly by McElhannon v. Ford, 73 P.3d 827, 831 (N.M. Ct. App. 2003), and R.A. Peck, Inc. v. Liberty Fed. Sav. Bank, 766 P.2d 928, 932 (N.M. Ct. App. 1988)). Duty to disclose. (1) Restatement (Second) of Torts § 551. McElhannon v. Ford, 73 P.3d 827, 831 (N.M. Ct. App. 2003). (2) Superior knowledge. Dungan v. Smith, 415 P.2d 549, 551 (N.M. 1966).


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State Elements and proof of duty to disclose New York Elements. (1) A duty to disclose material facts; (2) knowledge of material facts by a party bound to make such

disclosures; (3) failure to discharge a duty to disclose; (4) scienter; (5) reliance; and (6) damages. Oden v. Boston Sci. Corp., 330 F. Supp. 3d 877, 898 (E.D.N.Y. 2018).

Duty to disclose. (1) Restatement (Second) of Torts § 551. Bank of Am., N.A. v. Bear Stearns Asset Mgmt., 969 F. Supp. 2d 339, 353 (S.D.N.Y. 2013). (2) Superior knowledge. TVT Records v. Island Def Jam Music Grp., 412 F.3d 82, 91 (2d Cir. 2005). (3) Partial, misleading disclosure. Id.

North Carolina

Elements. (1) Where there is a duty to speak, concealment of a material fact, (2) reasonably calculated to deceive, (3) made with intent to deceive, (4) which does in fact deceive, (5) reasonable reliance, and (6) resulting in damage to the injured party. Forbis v. Neal, 649 S.E.2d 382, 387 (N.C. 2007); Griffin v. Wheeler-Leonard & Co., 225 S.E.2d 557, 565 (N.C. 1976). Duty to disclose. (1) Superior knowledge. Hardin v. KSC Int’l, Inc., 682 S.E.2d 726, 733 (N.C. Ct. App. 2009); In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19. (2) Partial, misleading disclosure. Silicon Knights, Inc. v. Epic Games, Inc., 2011 WL 1134453, at *6 (E.D.N.C. Jan. 25, 2011), report and recommendation adopted, 2011 WL 1134447 (E.D.N.C. Mar. 24, 2011).

North Dakota Elements. (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) materiality; (4) reliance; and (5) actual damages proximately caused by the nondisclosure. Northstar Founders, LLC v. Hayden Capital USA, LLC, 855 N.W.2d 614, 626 (N.D. 2014); N.D.C.C. § 9–03–08 (claim for actual fraud by contracting party includes “suppression of that which is true by one having knowledge or belief of the fact”). No duty to disclose is required, unlike a claim for deceit by a non-contracting party. See Erickson v. Brown, 747 N.W.2d 34, 44 (N.D. 2008); N.D.C.C. § 9–10–02(3) (claim for deceit by non-contracting party includes the “suppression of a fact by one who is bound to disclose it”). Duty to disclose (not required except in claim for deceit by non-contracting party). (1) Restatement (Second) of Torts § 551. Dewey v. Lutz, 462 N.W.2d 435, 440–41 (N.D. 1990).

Ohio Elements. (1) Where there is a duty to disclose, concealment of a fact, (2) that is material to the transaction at hand, (3) made falsely, with knowledge of its falsity, or with such utter disregard and recklessness as to whether it is true or false that knowledge may be inferred, (4) with the intent of misleading another into relying upon it, (5) justifiable reliance upon the representation or concealment, and (6) a resulting injury proximately caused by the reliance. Lloyd v. Doherty, 2018 WL 6584288, at *5–6 (6th Cir. Nov. 27, 2018).


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State Elements and proof of duty to disclose Duty to disclose. (1) Restatement (Second) of Torts § 551. Miles v. Perpetual Sav. & Loan Co., 388 N.E.2d 1367, 1369 (Ohio 1979); Jack Turturici Family Tr. v. Carey, 962 N.E.2d 347, 352 (Ohio. Ct. App. 2011).

Oklahoma Elements. (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) materiality; (4) reliance; and (5) actual damages proximately caused by the nondisclosure. Okla. Stat. Ann. tit. 15, § 58 (actual fraud by a contracting party includes the “suppression of that which is true, by one having knowledge or belief of the fact”). A claim of deceit, by a non-contracting party, requires a duty to disclose. See Okla. Stat. Ann. tit. 76, § 3 (action for deceit by non-contracting party include “suppression of a fact by one who is bound to disclose it”). Duty to disclose (not required in claim for actual fraud under § 58 by contracting party). (1) Partial, misleading disclosure. Uptegraft v. Dome Petroleum Co., 764 P.2d 1350, 1353 (Okla. 1988); Kiefner v. Sullivan, 2014 WL 2197812, at *12 (N.D. Okla. May 27, 2014). (2) Superior knowledge. Massey v. Flowers Foods, Inc., 2017 WL 3639150, at *4 (W.D. Okla. Apr. 21, 2017); Kiefner, 2014 WL 2197812, at *12.

Oregon Elements. (1) Silence or nondisclosure of a material fact; (2) the defendant either (a) remained silent when the defendant had a duty to speak, or (b) assumed the obligation to make a full and fair disclosure of the whole truth by making a representation in the nature of a ‘half-truth; (3) the fact’s materiality; (4) the speaker’s knowledge of its falsity or ignorance of its truth; (5) his intent that it should be acted on by the person and in the manner reasonably contemplated; (6) the hearer’s ignorance of its falsity; (7) his reliance on its truth; (8) his right to rely thereon; (9) and his consequent and proximate injury. Unigestion Holding, S.A. v. UPM Tech., Inc., 160 F. Supp. 3d 1214, 1223 (D. Or. 2016). Duty to disclose. (1) Restatement (Second) of Torts § 551. U.S. Nat’l Bank of Or. v. Fought, 630 P.2d 337, 347–348 (Or. 1981). (2) Superior knowledge. Heise v. Pilot Rock Lumber Co., 352 P.2d 1072, 1077 (Or. 1960).

Pennsylvania Elements. (1) Failure to disclose material facts, (2) that defendant knows may justifiably induce the other to act or refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these falsely omitted material facts, (4) when under a duty to the other to exercise reasonable care to disclose the matter in question, (5) justifiable reliance, and (6) the resulting injury was proximately caused by the reliance. LEM 2Q, LLC v. Guar. Nat’l Title Co., 144 A.3d 174, 181 & n.11 (Pa. Super. Ct. 2016) (citing Restatement (Second) of Torts § 551); Youndt v. First Nat’l Bank of Port Allegany, 868 A.2d 539, 550 (Pa. Super. Ct. 2005) (citing Restatement (Second) of Torts § 551).


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State Elements and proof of duty to disclose Duty to disclose. (1) Restatement (Second) of Torts § 551. LEM 2Q, LLC, 144 A.3d at 181 & n.11; Youndt, 868 A.2d at 545; Hamilton v. Speight, 2019 WL 161731, at *2 (E.D. Pa. Jan. 10, 2019); Boardakan Rest. LLC v. Gordon Grp. Holdings, LLC, 2015 WL 4597970, at *1 n.4 (E.D. Pa. July 31, 2015); United Nat’l Ins. Co. v. Aon Ltd., 2008 WL 3819865, at *6 (E.D. Pa. Aug. 8, 2008).

Rhode Island Elements. (1) The defendant concealed a material fact, (2) despite a duty to disclose that fact, (3) intending thereby to induce plaintiff to rely thereon, and (4) the plaintiff justifiably relied thereon to his or her damage. W. Reserve Life Assur. Co. of Ohio v. Caramadre, 847 F. Supp. 2d 329, 337 (D.R.I. 2012), aff’d sub nom. W. Reserve Life Assur. Co. of Ohio v. ADM Assocs., LLC, 793 F.3d 168 (1st Cir. 2015); R.I. Civ. Jury Inst. 2506. Duty to disclose. (1) Restatement (Second) of Torts § 551. MilitaryHomeLink.com, LLC v. Hunt Cos., 2018 WL 4100502 (D.R.I. Aug. 28, 2018). (2) Superior knowledge. Stebbins v. Wells, 766 A.2d 369, 373 (R.I. 2001).

South Carolina

Elements. (1) Nondisclosure of a material fact, where there is a duty to disclose, (2) its falsity, (3) its materiality, (4) either knowledge of its falsity or a reckless disregard of its truth or falsity, (5) intent that the nondisclosure be acted upon, (6) the hearer’s ignorance of its falsity, (7) the hearer’s reliance on its truth, (8) the hearer’s right to rely thereon, and (9) the hearer’s consequent and proximate injury. Kiriakides v. Atlas Food Sys. & Servs., Inc., 527 S.E.2d 371 (S.C. Ct. App. 2000), aff’d as modified on other grounds, 541 S.E.2d 257 (S.C. 2001). Duty to disclose. (1) Superior knowledge. Lawson v. Citizens & S. Nat’l Bank of S.C., 193 S.E.2d 124, 128 (S.C. 1972); SC JI CIVIL § 18-4(4). (2) Partial, misleading disclosure. SC JI CIVIL § 18-4(1).

South Dakota Elements. (1) A contract between the parties; (2) the suppression of that which is true by one having knowledge or belief of the fact; (3) with intent to deceive another party thereto or to induce him to enter into the contract; (4) justifiable reliance; and (5) actual damages proximately caused by the nondisclosure. Stern Oil Co. v. Brown, 817 N.W.2d 395, 400 & n.5 (S.D. 2012); S.D. Codified Laws § 53-4-5(3) (claim for actual fraud by contracting party includes “suppression of that which is true by one having knowledge or belief of the fact”). No duty to disclose is required, unlike a claim for deceit by a non-contracting party. S.D. Codified Laws 2-10-2(3) (claim for deceit by non-contracting party includes the “suppression of a fact by one who is bound to disclose it”). Duty to disclose. (1) Restatement (Second) of Torts § 551. Lindskov v. Lindskov, 800 N.W.2d 715, 719 (S.D. 2011); Schwartz v. Morgan, 776 N.W.2d 827, 831 (S.D. 2009); Grelley v. Walters, 2014 WL 1330983, at *7 (D.S.D. Mar. 30, 2014).

Tennessee Elements. (1) The defendant concealed or suppressed a material fact; (2) the defendant was under a duty to disclose the fact to the plaintiff; (3) the defendant intentionally concealed or suppressed the fact with the intent to deceive the


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State Elements and proof of duty to disclose plaintiff; (4) the plaintiff was not aware of the fact and would have acted differently if the plaintiff knew of the concealed or suppressed fact; and (5) as a result of the concealment or suppression of the fact, the plaintiff sustained damage. Tenn. Pattern Inst. Civil § 8.38. Duty to disclose. (1) Restatement (Second) of Torts § 551. GuestHouse Int’l, LLC v. Shoney’s N. Am. Corp., 330 S.W.3d 166, 196 (Tenn. Ct. App. 2010); Bearden v. Honeywell Int’l, Inc., 720 F. Supp. 2d 932, 939 (M.D. Tenn. 2010). (2) Superior knowledge. Chiarella v. United States, 445 U.S. 222, 248 (1980) (citing Simmons v. Evans, 185 Tenn. 282, 285–87, 206 S.W.2d 295, 296–297 (1947)).

Texas Elements. (1) The defendant deliberately failed to disclose material facts; (2) the defendant had a duty to disclose such facts to the plaintiff; (3) the plaintiff was ignorant of the facts and did not have an equal opportunity to discover them; (4) the defendant intended the plaintiff to act or refrain from acting based on the nondisclosure; and (5) the plaintiff relied on the non-disclosure, which resulted in injury. Bombardier Aero. Corp. v. SPEP Aircraft Holdings, LLC, 2019 WL 406075, at *3 (Tex. Feb. 1, 2019). Duty to disclose. (1) Partial, misleading disclosure. Bombardier Aero. Corp., 2019 WL 406075, at *3. (2) Superior knowledge. Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323, 338 (Tex. 2011); Humble Sand & Gravel, Inc. v. Gomez, 146 S.W.3d 170, 182 (Tex. 2004).

Utah Elements. (1) The omission of a material fact when there is a duty to disclose, (2) for the purpose of inducing action on the part of the other party, (3) with actual, justifiable reliance, (4) resulting in damage to that party. Precision Vascular Sys., Inc. v. Sarcos, L.C., 199 F. Supp. 2d 1181, 1191 (D. Utah 2002) (citing Taylor v. Gasor, Inc., 607 P.2d 293, 294 (Utah 1980)). Duty to disclose. (1) Restatement (Second) of Torts § 551. First Sec. Bank of Utah N.A. v. Banberry Dev. Corp., 786 P.2d 1326, 1330–1331 & n.13 (Utah 1990). (2) Superior knowledge. Gadd v. Olson, 685 P.2d 1041, 1044 (Utah 1984); Demarco v. LaPay, 2009 WL 3855704, at *10 (D. Utah Nov. 17, 2009).

Vermont Elements. (1) Concealment of facts, (2) affecting the essence of the transaction, (3) not open to the defrauded party’s knowledge, (4) by one with knowledge and a duty to disclose, (5) with the intent to mislead, and (6) detrimental reliance by the defrauded party. Fuller v. Banknorth Mortg. Co., 788 A.2d 14, 16 (Vt. 2001). Duty to disclose. (1) Restatement (Second) of Torts § 551. Pearson v. Simmonds Precision Prods., Inc., 624 A.2d 1134, 1136 (Vt. 1993); Nashef v. AADCO Med., Inc., 2013 WL 12347190, at *7 (D. Vt. Apr. 29, 2013). (2) Superior knowledge. Lay v. Pettengill, 38 A.3d 1139, 1144 (Vt. 2011).


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State Elements and proof of duty to disclose Virginia Elements. (1) The defendant’s omission of material facts, (2) that he knows may justifiably induce the other to act or

refrain from acting in a business transaction, (3) in contemplation of plaintiff’s reliance upon these falsely omitted material facts, (4) reliance by the party misled, and (5) resulting damage to the party misled. State Farm Mut. Auto. Ins. Co. v. Remley, 618 S.E.2d 316, 320 (Va. 2005); Restatement (Second) of Torts § 551 (cited by Ware v. Scott, 257 S.E.2d 855, 858 n.3 (1979)). Duty to disclose. (1) Restatement (Second) of Torts § 551. Ware v. Scott, 257 S.E.2d 855, 857–58 (Va. 1979); Bank of Montreal v. Signet Bank, 193 F.3d 818, 829 (4th Cir. 1999); In re Starlight Grp., LLC, 552 B.R. 106, 111 (Bankr. E.D. Va. 2016). (2) Superior knowledge. Spence v. Griffin, 372 S.E.2d 595, 599 (Va. 1988); White v. Potocska, 589 F. Supp. 2d 631, 642 (E.D. Va. 2008). (3) Partial, misleading disclosure. Bank of Montreal, 193 F.3d at 829.

Washington Elements. (1) Omission of an existing fact that Defendant had a duty to disclose; (2) materiality; (3) falsity; (4) the speaker’s knowledge of its falsity; (5) intent of the speaker that it should be acted upon by the plaintiff; (6) plaintiff’s ignorance of its falsity; (7) plaintiff’s reliance; (8) plaintiff’s right to rely upon it; and (9) damages suffered by the plaintiff. Adams v. King Cty., 192 P.3d 891, 902 (Wash. 2008); Schreiner Farms, Inc. v. Am. Tower, Inc., 293 P.3d 407, 412 (Wash. Ct. App. 2013). Duty to disclose. (1) Restatement (Second) of Torts § 551. Colonial Imps., Inc. v. Carlton N.W., Inc., 853 P.2d 913, 916 (Wash. 1993); Merriman v. Am. Guar. & Liab. Ins. Co., 396 P.3d 351, 361 (Wash. Ct. App. 2017). (2) Superior knowledge. Merriman, 396 P.3d at 361; In re Volkswagen Timing Chain Prod. Liab. Litig., 2017 WL 1902160, at *19. (3) Partial, misleading disclosure. Van Dinter v. Orr, 138 P.3d 608, 610 (Wash. 2006).

West Virginia Elements. (1) Concealment of material facts by knowledge or the means of knowledge; (2) duty to disclose; (3) intention to mislead or defraud; (4) plaintiff relied upon it and was justified under the circumstances in relying upon it; and (5) plaintiff was damaged because he relied upon it. Trafalgar House Constr., Inc. v. ZMM, Inc., 567 S.E.2d 294, 300 (W. Va. 2002). Duty to disclose. (1) Superior knowledge. Trafalgar, 567 S.E.2d at 301; Thacker v. Tyree, 297 S.E.2d 885, 888 & n.3 (W. Va. 1982). (2) Partial, misleading disclosure. Lawyer Disciplinary Bd. v. Smoot, 716 S.E.2d 491, 502 (W. Va. 2010).

Wisconsin Elements. (1) Failure to disclose a material fact, (2) when there is a duty to disclose that fact, (3) made with intent to deceive the plaintiff in order to induce the plaintiff to act on it to plaintiff’s pecuniary damage, and (4) plaintiff’s detrimental reliance on the representation as true. Schmidt v. Bassett Furniture Indus., 2009 WL 3380354, at *10 (E.D. Wis. Oct. 20, 2009).


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State Elements and proof of duty to disclose Duty to disclose. (1) Superior knowledge. Kaloti Enters., Inc. v. Kellogg Sales Co., 699 N.W.2d 205, 213–15 (Wis. 2005). (2) Partial, misleading disclosure. Kailin v. Armstrong, 643 N.W.2d 132, 146 (Wis. 2002).

Wyoming Elements. (1) The defendant fails to disclose to another a fact that he knows may justifiably induce the other to act or refrain from acting in a business transaction; (2) the defendant is under a duty to the other to exercise reasonable care to disclose the matter in question; (3) the plaintiff reasonably believed the representation to be true; and (4) the plaintiff relied on the false representation and suffered damages. Singer v. Lajaunie, 339 P.3d 277, 285 (Wyo. 2014); Hayek v. Bank of Am. Loans, 2013 WL 11521926, at *6 (D. Wyo. Dec. 13, 2013) (citing Restatement (Second) of Torts § 551). Duty to disclose. (1) Restatement (Second) of Torts § 551. Hayek, 2013 WL 11521926, at *6. (2) Partial, misleading disclosure. GreenHunter Energy, Inc. v. W. Ecosystems Tech., Inc., 337 P.3d 454, 463 (Wyo. 2014).


APPENDIX 5


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State-law standards for compensatory damages due to common-law fraud

State Compensatory damages standards Alabama All damages proximately resulting from reliance upon the fraud, including all

damages that were within the contemplation of the parties or were the necessary or natural and proximate consequence of the fraud. Ex parte Hurricane Freddy’s, Inc., 861 So. 2d 1075, 1077 (Ala. 2002).

Alaska Either out-of-pocket or benefit-of-the-bargain damages, plus special or consequential damages. Turnbull v. LaRose, 702 P.2d 1331, 1335–36 (Alaska 1985).

Arizona (1) All out-of-pocket losses; (2) the benefit of the bargain; and (3) consequential damages. Ulan v. Richtars, 446 P.2d 255, 263 (Ariz. Ct. App. 1968).

Arkansas Either out-of-pocket damages or benefit-of-the-bargain damages, plus consequential damages. Smith v. Walt Bennett Ford, Inc., 864 S.W.2d 817, 823–824 (Ark. 1993).

California Out-of-pocket losses, plus any additional damage arising from the particular transaction. All. Mortg. Co. v. Rothwell, 10 Cal. 4th 1226, 1241 n.5 (1995) (citing Cal. Civ. Code § 3343).

Colorado Benefit-of-the-bargain damages, plus any other damages naturally and proximately caused by the misrepresentation. Niemi v. Lasshofer, 770 F.3d 1331, 1355 (10th Cir. 2014) (citing Ballow v. PHICO Ins. Co., 878 P.2d 672, 677 (Colo. 1994)).

Connecticut Benefit-of-the-bargain damages, together with any consequential damages that might foreseeably be expected to follow from the character of the fraud. Miller v. Appleby, 438 A.2d 811, 814 (Conn. 1981).

Delaware Either out-of-pocket or benefit-of-the-bargain damages, including any injury resulting from the direct and natural consequences of his acting on the strength of the defendant’s statements. Stephenson v. Capano Dev., Inc., 462 A.2d 1069, 1077 (Del. 1983); In re Wayport, Inc. Litig., 76 A.3d 296, 327 (Del. Ch. 2013).

Florida Benefit-of-the bargain damages or out-of-pocket damages, whichever will more fully compensate plaintiff. Hollister Inc. v. Zassi Holdings, Inc., 752 F. App’x 888, 893 (11th Cir. 2018).

Georgia Out-of-pocket damages and pecuniary loss suffered otherwise as a consequence of the plaintiff’s reliance upon the representation. Legacy Acad., Inc. v. Doles-Smith Enters., Inc., 789 S.E.2d 194, 199 (Ga. Ct. App. 2016).

Hawaii Out-of-pocket damages and pecuniary loss suffered otherwise as a consequence of the plaintiff’s reliance upon the representation. Zanakis-Pico v. Cutter Dodge, Inc., 47 P.3d 1222, 1235 (Haw. 2002).

Idaho Out-of-pocket damages, including consequential damages, or benefit-of-the-bargain damages. The victim of fraud is entitled to compensation for every wrong which is the natural and proximate result of the fraud, including consequential damages. The measure of damages which should be adopted under the facts of a case is the one which will effect such result. April


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State Compensatory damages standards Beguesse, Inc. v. Rammell, 328 P.3d 480, 491 (Idaho 2014); Umphrey v. Sprinkel, 682 P.2d 1247, 1257 (Idaho 1983).

Illinois Benefit-of-the bargain damages, plus consequential damages proximately resulting from the fraud. Price v. Philip Morris, Inc., 848 N.E.2d 1, 79 (Ill. 2005); Sheth v. SAB Tool Supply Co., 990 N.E.2d 738, 759 (Ill. Ct. App. 2013).

Indiana Damages that are the natural and proximate consequences of the act complained of, including reasonably foreseeable consequential damages. Hi-Tec Props., LLC v. Murphy, 14 N.E.3d 767, 777 (Ind. Ct. App. 2014); Captain & Co. v. Stenberg, 505 N.E.2d 88, 99 (Ind. Ct. App. 1987).

Iowa Benefit-of-the-bargain damages plus proximately-cause consequential damages or, if that measure does not make the plaintiff whole, out of pocket expenses. Midwest Home Distrib., Inc. v. Domco Indus. Ltd., 585 N.W.2d 735, 739 (Iowa 1998); Mike Finnin Ford, Inc. v. Automatic Data Processing, Inc., 220 F. Supp. 2d 970, 977–978 (D. Iowa 2001).

Kansas Benefit-of-the-bargain damages, which includes the loss of the gains plaintiff reasonably expected to make from the contract. K-B Trucking Co. v. Riss Int’l Corp., 763 F.2d 1148, 1160 (10th Cir. 1985); Alexander v. Certified Master Builder Corp., 43 F. Supp. 2d 1242, 1250–1251 (D. Kan. 1999).

Kentucky Compensation for every wrong that was the natural and proximate result of the fraud, measured by out-of-pocket losses and the pecuniary loss suffered as a consequence of reliance upon the misrepresentation. Sanders, Inc. v. Chesmotel Lodge, Inc., 300 S.W.2d 239, 241 (Ky. 1957); In re Pearl, 577 B.R. 513, 526 (Bankr. E.D. Ky. 2017).

Louisiana All damages, foreseeable or not, that are a direct consequence of the fraud, including lost profits. Castille v. St. Martin Par. Sch. Bd., 218 So. 3d 52, 56 (La. 2017); La. Civ. Code Ann. art. 1997; Home Life Ins. Co., New York v. Equitable Equip. Co., 680 F.2d 1056, 1061 (5th Cir.).

Maine (1) The pecuniary loss of which the misrepresentation is a legal cause, including (a) the difference between the value of what the recipient has received in the transaction and its purchase price or other value given for it; and (b) pecuniary loss suffered otherwise as a consequence of the recipient’s reliance upon the misrepresentation. (2) The recipient of an intentional misrepresentation in a business transaction is also entitled to recover additional damages sufficient to give him the benefit of his contract with the maker, if these damages are proved with reasonable certainty. Jourdain v. Dineen, 527 A.2d 1304, 1307 & n.2 (Me. 1987) (applying Restatement (Second) of Torts § 549); Telerent Leasing Corp. v. Pine State Plumbing & Heating, Inc., 231 F. Supp. 2d 352, 358 (D. Me. 2002).

Maryland Plaintiff may elect out-of-pocket or benefit-of-the-bargain damages, including pecuniary loss suffered as a consequence of the recipients reliance upon the truth of the representation. Beardmore v. T.D. Burgess Co., 226 A.2d 329, 332 (Md. 1967) (citing Restatement of Torts § 549); Capital Fin., LLC v. Rosenberg, 2019 WL 296706, at *15 (D. Md. Jan. 23, 2019).


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State Compensatory damages standards Massachusetts Out-of-pocket damages, plus pecuniary loss suffered otherwise as a

consequence of reliance upon the truth of the representation, or benefit-of-the-bargain damages. Rice v. Price, 164 N.E.2d 891 (Mass. 1960); Smith v. Jenkins, 2014 WL 763219, at *1 (D. Mass. Feb. 21, 2014).

Michigan Damages resulting from the wrongful act, whether foreseeable or not, provided that the damages are the legal and natural consequences of the wrongful act and might reasonably have been anticipated. Cooper v. Auto Club Ins. Ass’n, 751 N.W.2d 443, 449 n.4 (Mich. 2008).

Minnesota The difference between the actual value of the property received and the purchase price paid for it, together with any damages naturally and proximately caused by the fraud. Gopher Oil Co. v. Union Oil Co. of Calif., 955 F.2d 519, 528 (8th Cir. 1992); Johnson v. Bobcat Co., 175 F. Supp. 3d 1130, 1138 (D. Minn. 2016).

Mississippi Benefit-of-the-bargain or out-of-pocket damages, including consequent and proximate injury. Terry v. Oby T. Rogers, PLLC, 256 So. 3d 1175, 1180 (Miss. 2018); Browder v. Williams, 765 So. 2d 1281, 1286 (Miss. 2000).

Missouri Benefit-of-the-bargain damages, plus consequential damages. Davis v. Clearly Bldg. Corp., 143 S.W.3d 659, 669 (Mo. Ct. App. 2004); In re Reuter, 427 B.R. 727, 767 (Bankr. W.D. Mo. 2010), aff’d, 443 B.R. 427 (B.A.P. 8th Cir. 2011), aff’d, 686 F.3d 511 (8th Cir. 2012).

Montana Benefit-of-the-bargain damages, plus consequential damages. Bokma Farms, Inc. v. State, 14 P.3d 1199, 1201–1202 (Mont. 2000) (applying Restatement (Second) of Torts § 549); Poulsen v. Treasure State Indus., Inc., 626 P.2d 822, 829 (Mont. 1981).

Nebraska The pecuniary loss to plaintiff of which the misrepresentation is a legal cause, including (1) the difference between the value of what he has received in the transaction and its purchase price or other value given for it and (2) pecuniary loss suffered otherwise as a consequence of the recipient’s reliance upon the misrepresentation. Rambo v. Sullivan, 2007 WL 2122172, at *9 (Neb. Ct. App. July 24, 2007).

Nevada The pecuniary loss to plaintiff of which the misrepresentation is a legal cause, including (1) the difference between the value of what he has received in the transaction and its purchase price or other value given for it and (2) pecuniary loss suffered otherwise as a consequence of the recipient’s reliance upon the misrepresentation. Meredith v. Weilburg, 2014 WL 4810302, at *5 (D. Nev. Sept. 29, 2014).

New Hampshire (1) Out-of-pocket loss, plus pecuniary loss suffered otherwise as a consequence of the recipient’s reliance on the misrepresentation and (2) benefit-of-the-bargain damages. LHC Nashua P’ship, Ltd. v. PDNED Sagamore Nashua, L.L.C., 659 F.3d 450, 462 (5th Cir. 2011) (applying New Hampshire law).

New Jersey Benefit-of-the-bargain damages or out-of-pocket damages, such that all damages that are the proximate result of the wrong are awarded. Zeliff v. Sabatino, 104 A.2d 54, 74 (N.J. 1954).


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State Compensatory damages standards New Mexico Benefit-of-the-bargain damages, plus damages that are the direct and natural

consequence of the fraud. Register v. Roberson Const. Co., 741 P.2d 1364, 1368 (N.M. 1987).

New York Out-of-pocket and consequential damages. In re Signature Apparel Grp. LLC, 577 B.R. 54, 93 (Bankr. S.D.N.Y. 2017).

North Carolina Benefit-of-bargain damages and consequential damages. TradeWinds Airlines, Inc. v. C-S Aviation Servs., 733 S.E.2d 162, 169 (N.C. Ct. App. 2012).

North Dakota N.D. Cent. Code § 32-03-20 (“For the breach of an obligation not arising from contract, the measure of damages, except when otherwise expressly provided by law, is the amount which will compensate for all the detriment proximately caused thereby, whether it could have been anticipated or not.”); Bohn v. Johnson, 371 N.W.2d 781, 789 (N.D. 1985) (“section 32-03-20 ‘contemplate[s] full compensation for any detriment … proximately caused by the breach of an obligation’”).

Ohio Out-of-pocket damages, plus consequential damages. McLean v. Charles Ellis Realty, Inc., 76 P.3d 661, 668 (Or. Ct. App. 2003).

Oklahoma Benefit-of-the-bargain damages, including amounts that were the natural and probable result of appellant’s misrepresentations. Bowman v. Presley, 212 P.3d 1210, 1218 (Okla. 2009); LeFlore v. Reflections of Tulsa, Inc., 708 P.2d 1068, 1077 (Okla. 1985).

Oregon Out-of-pocket damages, along with consequential damages not encompassed in the out-of-pocket measure. Osborne v. Hay, 585 P.2d 674, 679 (Or. 1978); McLean v. Charles Ellis Realty, Inc., 76 P.3d 661, 668 (Or. Ct. App. 2003).

Pennsylvania Out-of-pocket damages, plus damages that were the proximate result of the fraud, when plaintiff has entered into a bargain with the defendant. Scaife Co. v. Rockwell-Standard Corp., 285 A.2d 451, 457 (Pa. 1971); Silverman v. Bell Sav. & Loan Ass’n, 533 A.2d 110, 116 (Pa. Sup. Ct. 1987); Edward J. DeBartolo Corp. v. Coopers & Lybrand, 928 F. Supp. 557, 566 (W.D. Pa. June 11, 1996).

Rhode Island Benefit-of-the-bargain damages, along with reasonably certain damages as a consequence of defendants’ wrongdoing. Fogarty v. Palumbo, 163 A.3d 526, 537 (R.I. 2017); Kooloian v. Suburban Land Co., 873 A.2d 95, 100 (R.I. 2005).

South Carolina Benefit-of-the-bargain damages, together with any proximately caused consequential or special damages. Schnellmann v. Roettger, 645 S.E.2d 239, 241 (S.C. 2007).

South Dakota S.D. Stat. § 21-3-1 (“For the breach of an obligation not arising from contract, the measure of damages, except where otherwise expressly provided by this code, is the amount which will compensate for all the detriment proximately caused thereby, whether it could have been anticipated or not.”).

Tennessee (1) The pecuniary loss of which the misrepresentation is a legal cause, including (a) the difference between the value of what the recipient has received in the transaction and its purchase price or other value given for it; and (b) pecuniary loss suffered otherwise as a consequence of the recipient’s


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State Compensatory damages standards reliance upon the misrepresentation. (2) The recipient of an intentional misrepresentation in a business transaction is also entitled to recover additional damages sufficient to give him the benefit of his contract with the maker, if these damages are proved with reasonable certainty. Hodge v. Craig, 382 S.W.3d 325, 343 (Tenn. 2012) (adopting Restatement of Torts (Second) § 549).

Texas Out-of-pocket damages, consequential damages, and benefit-of-the-bargain damages. Bohnsack v. Varco, L.P., 668 F.3d 262, 275 (5th Cir. 2012).

Utah Benefit-of-the-bargain damages, along with any additional damages, which are a natural and proximate consequence of the defendant’s misrepresentations. Dugan v. Jones, 615 P.2d 1239, 1247, 1250 (Utah 1980).

Vermont Damages were the natural and proximate consequences of the fraud, and that can be clearly defined and ascertained. Smith v. Country Vill. Int’l, Inc., 944 A.2d 240, 243 (Vt. 2007).

Virginia Benefit-of-the-bargain damages, along with consequential damages such as lost profits. CGI Fed. Inc. v. FCi Fed., Inc., 814 S.E.2d 183, 189 (Va. 2018); Klaiber v. Freemason Assocs., Inc., 587 S.E.2d 555, 558–59 (Va. 2003).

Washington Benefit-of-the-bargain damages, along with all losses proximately caused by defendant’s fraud. McInnis & Co. v. W. Tractor & Equip. Co., 388 P.2d 562, 566 (Wash. 1964); Salter v. Heiser, 239 P.2d 327, 331 (Wash. 1951).

West Virginia Any injury incurred as a result of the defendant’s fraudulent conduct. Kessel v. Leavitt, 511 S.E.2d 720, 812 (W. Va. 1998).

Wisconsin Benefit-of-the-bargain damages, along with consequential or special damages that can be proved with reasonable certainty and that were proximately caused by the fraud or were within the contemplation of the parties at the time of the fraud. Gyldenvand v. Schroeder, 280 N.W.2d 235, 239 (Wis. 1979).

Wyoming The difference in value of what plaintiff received in the transaction and its purchase price or other value given, and any loss suffered otherwise as a consequence of plaintiff’s reliance upon such deceit or misrepresentation. And where application of the out-of-pocket and benefit-of-the bargain rules results in leaving a loss uncompensated, a trial court may properly allow recovery of the economic loss sustained. Big-O Tires, Inc. v. Santini, 838 P.2d 1169, 1173–1174 (Wyo. 1992).


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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

IN RE: VOLKSWAGEN “CLEAN DIESEL” MARKETING, SALES PRACTICES, AND PRODUCTS LIABILITY LITIGATION This document relates to: Napleton Orlando Imports, LLC, et al. v. Volkswagen Group of America, Inc., et al., Case No. 3:16-cv-02086-CRB

No. 02672-CRB (JSC) [PROPOSED] ORDER GRANTING PLAINTIFFS’ MOTION FOR CLASS CERTIFICATION


[PROPOSED] ORDER GRANTING MOTION FOR CLASS CERTIFICATION Case No. 02672-CRB (JSC) 010584-11 1117049 V1

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Having considered Plaintiffs’ June 14, 2019 Notice of Motion and Motion for Class

Certification, Appointment of Class Representatives and of Hagens Berman Sobol Shapiro LLP and

Bass Sox Mercer as Class Counsel (“Motion”), it is hereby ORDERED that Plaintiffs’ Motion is

GRANTED.

With respect to the Class defined below, the Court finds and concludes that:

a. The Class Members are so numerous as to make joinder of them

impracticable;

b. There are questions of law and fact common to the Class, and such questions

predominate over any questions affecting only individual Class Members;

c. Plaintiffs’ claims, and the defenses asserted to those claims, are typical of the

claims of Class Members, and the defenses asserted to those claims;

d. Plaintiffs and their counsel have fairly and adequately protected the interests

of Class Members throughout this action;

e. The proposed Class Action is superior to all other available methods for fairly

and efficiently resolving these claims; and

f. Plaintiffs have presented a method of calculating damages that is appropriately

tied to their theory of liability and is capable of measurement on a classwide

basis; and it is further

ORDERED that the following class is certified:

All persons or entities who owned a Volkswagen-branded franchise dealership that operated in the United States as of September 18, 2015. Excluded from the Class are Volkswagen and its subsidiaries and affiliates; Bosch

Defendants and their subsidiaries and affiliates; Class counsel and their employees; the judicial

officers and their immediate family members and associated court staff assigned to this case; and all

persons who make a timely election to be excluded from the Classes, and governmental entities.

IT IS HEREBY CERTIFIED pursuant to Rules 23(a) and (b)(3) of the Federal Rules of Civil

Procedure to pursue claims under the Racketeer Influenced and Corrupt Organizations Act, 18


[PROPOSED] ORDER GRANTING MOTION FOR CLASS CERTIFICATION Case No. 02672-CRB (JSC) 010584-11 1117049 V1

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U.S.C. § 1962(c)–(d), on behalf of a nationwide class, and civil conspiracy to defraud claims under

the laws of all fifty states, and it is further

ORDERED that Plaintiffs J. Bertolet, Inc., Direct B, LLC (d/b/a Brandon Volkswagen), and

SAI Auto Group, LLC (d/b/a Bozzani Volkswagen) are hereby designated as Class Representatives

for the Class; and it is further

ORDERED that Hagens Berman Sobol Shapiro LLP and Bass Sox Mercer, previously

appointed by the Court as Interim Lead Counsel, is confirmed as Class Counsel having considered

the factors provided in Rule 23(g)(1)(A).

IT IS SO ORDERED.

DATED: __________________ ______________________________________ The Honorable Charles R. Breyer

United States District Judge
