In re Future Motion Prods. Liab. Litig.

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IN RE FUTURE MOTION, INC. PRODUCTS LIABILITY LITIGATION This Document Relates to Loh v. Future Motion, Inc., No. 21-cv-06088-BLF

Nos. 21-cv-06088-BLF, 23-md-03087-BLF

United States District Court, N.D. California, San Jose Division

July 12, 2024

ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS AND DENYING MOTION TO STRIKE

[RE: ECF NO. 120, 123]

In this putative class action and multi-district litigation (“MDL”) member case, Plaintiffs allege that the Onewheel electronic motorized skateboard has a design defect that causes the board to nosedive, throwing riders off the board, and that Defendant Future Motion, Inc., fraudulently promoted Onewheels as “toys” without adequately warning users of the safety risks. See 21-6088 ECF No. 76 (“CCAC”) ¶¶ 2, 5. Defendant has filed two motions in the class action case: a motion to dismiss the consolidated class action complaint for failure to state a claim and a motion to strike the class allegations. See ECF No. 120 (“MTS”); ECF No. 123 (“MTD”); see also 21-6088 ECF No. 107; 21-6088 ECF No. 109. Plaintiffs oppose both motions. See ECF No. 125 (“MTS Opp.”); ECF No. 126 (“MTD Opp.”). Defendant filed replies. See ECF No. 121 (“MTS Reply”); ECF No. 125 (“MTD Reply”). The Court held a hearing on the motions on May 23, 2024.

For the reasons stated below, the Court GRANTS WITH LEAVE TO AMEND IN PART, GRANTS WITHOUT LEAVE TO AMEND IN PART, and DENIES IN PART the motion to dismiss and DENIES WITHOUT PREJUDICE the motion to strike.

I. BACKGROUND

A. Factual Background

The Onewheel is a self-balancing, battery-powered electric skateboard that has a single wheel that is fixed to the center of the board and spans the board's width and approximately one-third of its length. See CCAC ¶¶ 2, 30, 42. The Onewheel uses an electric motor housed inside the wheel, a rechargeable lithium battery housed in one side of the rider platform, and a control module housed in the other side of the platform. Id. ¶ 42. A user rides a Onewheel in a similar fashion to a traditional skateboard or snowboard, with the rider standing on the platform on either side of the center wheel. Id. ¶ 43. The Onewheel is self-balancing, meaning that the machine keeps the rider balanced in an “inverted pendulum” with the center of mass above the axis of rotation. Id. at ¶¶ 44-47. The rider accelerates by leaning forward and decelerates by leaning back. Id. ¶¶ 48-49.

Defendant has developed, produced, and sold the Onewheel since 2013. CCAC ¶ 31. Defendant has also developed and published owner's manuals, warranty booklets, advertising, and technical information about the Onewheel. Id. ¶ 32. Defendant conducts warranty repairs and monitors the performance of Onewheels throughout the United States. Id.

At issue in this action are all Onewheel models, including the Onewheel (original model), Onewheel+, Onewheel+ XR, Pint, Pint X, and GT. See CCAC ¶1 2 n.2. Defendant lists the top speed of the original Onewheel as 12 miles per hour (“mph”), the Onewheel+ as 19 mph, the Onewheel+ XR as 19 mph, the Pint as 16 mph, the Pint X as 18 mph, and the GT as 20 mph. Id. ¶ 33. However, Onewheels have been documented to carry riders at speeds as high as 32 mph. Id.

On November 16, 2022, the U.S. Consumer Product Safety Commission (“CPSC”) issued a warning to consumers about the risk of death and serious injury associated with the Onewheel ejecting riders and urged consumers to immediately stop using all Onewheel models. CCAC ¶ 36. In response, Defendant refused to agree to a recall and called the CPSC's statements “unjustified,” “alarmist,” “harsh,” and “unwarranted.” Id. ¶ 37. Defendant maintained that Onewheels are safe when users ride within their abilities and suggested that riders are at fault when they crash. Id. Defendant also stated that it evaluated a number of Onewheels that had suddenly stopped and found no underlying technical issues and that the Onewheels performed as designed. Id. ¶ 38.

Plaintiffs allege that the Onewheel has a “Nosedive Defect” in which the front of the machine or the “nose” slams into the ground while the board is still traveling forward, which brings the board to an abrupt stop and ejects the rider into the ground. See CCAC ¶¶ 54, 59-62. Plaintiffs allege that “[n]osedives occur when the sensors governing the motor, battery, and electrical systems detect that the motor, motor circuits, motor components, the battery, or a combination thereof, are too close to their functional limits,” which causes electrical censors in the machine to preemptively shut the motor down. Id. ¶ 54. Plaintiffs allege that there are two categories of nosedives: those that are warned by a “Pushback” warning and those without a warning or an inadequate warning. Id. ¶¶ 56-58. The Pushback warning system causes the machine to “push back” to warn the rider that rider is traveling too fast, ascending a steep hill, or the battery is too low. See id. ¶¶ 63-64. Plaintiffs allege that “[u]nlike other self-balancing devices, the Onewheel's Pushback is not strong enough to physically push the rider back to a stable position over the wheel by itself.” Id. ¶ 64. Pushback is the only warning system used by the Onewheel to warn a rider that the rider needs to change position, and it does not alert the rider of the reason for the Pushback. Id. ¶¶ 65-67.

Plaintiffs further allege that the Onewheel's design (i.e., the length of the board, the wheel, and the position or the rider) causes the machine to operate too close to the functional limits of the motor and battery. CCAC ¶ 68. When the Onewheel operates near its functional limits, the power and torque available to push the rider back is lower, rendering the Pushback warning unnoticeable. See id. ¶¶ 73-76, 81. The Pushback is also “influenced by tire pressure, wind direction, wind speed, battery level, surface conditions, velocity, grade, terrain, moisture, the rider's stance, the rider's weight, and any other factor that influences the current drawn by the motor.” Id. ¶ 79. Plaintiffs allege that the following defects exist in the Pushback warning system: (1) Pushback fails to engage before the motor shuts down; (2) Pushback can engage with too little time before the motor shuts down; and (3) the motor draws too much current and does not leave enough power in the battery to supply the energy needed for the Pushback. Id. ¶ 84. Plaintiffs also allege that the lithium battery in every Onewheel is defective because it lacks sufficient capacity to selfbalance the board and engage the Pushback system. Id. ¶ 85. Plaintiffs further allege that the motor in every Onewheel is defective because it lacks sufficient torque to self-balance the board and avoid nosedives. Id. ¶ 86.

Plaintiffs allege that Defendant knew of the defects in the Onewheel through several sources: (1) the development of the Onewheel's firmware and testing of the product, CCAC ¶¶ 88-93; (2) the Onewheel software application, which collects data on each board's battery, shutdowns, and performance, id. ¶¶ 94-97; (3) consumer complaints, reports of injuries on the internet, posts on Defendant's website, customer reviews on Amazon, and litigation, id. ¶¶ 98105; and (4) the existence of third-party products designed to make Onewheels safer, id. ¶¶ 11922. Despite its knowledge, Defendant promoted the Onewheel as a toy that anyone, of any age, can ride. Id. ¶¶ 123-30. Defendant also did not include warnings about the risks of a nosedive in its Owner's Manual and otherwise failed to disclose the Nosedive Defect. Id. ¶¶ 131-36. Defendant represents that the Onewheel is safe and that the Pushback feature “will actually and consistently engage to alert [users] that the board is reaching its operational limits,” but Defendant fails to mention defects in the Pushback system when describing the feature. Id. ¶¶ 137-50.

B. Procedural History

On August 6, 2021, Plaintiffs filed their initial complaint in this class action. See 21-6088 ECF No. 1. On September 28, 2021, Plaintiffs amended their complaint as a matter of course. See 21-6088 ECF No. 7 (“FAC”). After Defendant filed a motion to dismiss and a motion to strike, the parties stipulated to the withdrawal of the motions and leave to allow Plaintiffs to file a second amended complaint. See 21-6088 ECF No. 31 (granting the stipulation). Plaintiffs filed their second amended complaint on February 4, 2022. See 21-6088 ECF No. 33 (“SAC”). On July 11, 2022, Judge Davila granted Defendant's motion to dismiss with leave to amend and denied Defendant's motion to strike as moot. See 21-6088 ECF No. 56. Judge Davila found that all claims in the SAC are grounded in fraud and subject to Rule 9(b)'s higher pleading standard. Id. at 9-10. Under this standard, Judge Davila construed the alleged defect to be the Pushback feature and found that Plaintiffs had failed to sufficiently allege facts that would show the pushback feature was defective. See id. at 12-13. After Judge Davila consolidated a related class action against Defendant into this action, ECF No. 75, Plaintiffs filed the operative consolidated class action complaint. See CCAC. Defendant again moved to dismiss and moved to strike class allegations. See MTS; MTD. After those motions were fully briefed, the case was reassigned to this Court and consolidated as a member case in the MDL. See ECF No. 1 (the transfer order); ECF No. 3 (pretrial order no. 1, which consolidated the MDL member cases). The parties stipulated to the refiling of Defendant's motion to dismiss and motion to strike for disposition by the Court, which the Court granted. See ECF No. 88 (stipulation); ECF No. 98 (granting the stipulation).

The consolidated class action complaint brings claims on behalf of a Nationwide Class, a Nationwide Direct Purchase Subclass and ten...