Whirlpool Must Face Group Suit Over Moldy Washing Machines

Whirlpool Corp. was ordered by a federal appeals court in Cincinnati to face a lawsuit by a class of consumers who say their front-loading washing machines developed a smelly buildup of mold.

The Sixth Circuit appeals court today affirmed a lower- court ruling certifying the case as a class action, saying that all owners of the company’s Duet washers have been injured if it’s proven that they have a design defect that allows mold and mildew to grow.

“Because all Duet owners were injured at the point of sale upon paying a premium price for the Duets as designed, even those owners who have not experienced a mold problem are properly included within the certified class,” the appeals court said in its decision.

Whirlpool, based in Benton Harbor, Michigan, said a class action is inappropriate under federal rules because the mold problem affected fewer than 3 percent of the company’s washers.

The appliance maker is disappointed in the ruling and will ask the U.S. Supreme Court for review, a spokeswoman, Kristine Vernier, said in a statement.

“The Circuit has chosen to defy a series of Supreme Court decisions, most recently Comcast v. Behrend, which have made clear that certifying classes like the one in our case tramples basic standards of justice,” Vernier said. “In doing so, the Sixth Circuit has taken a direct shot, not just at one company or one industry, but also at American manufacturing as a whole, inventing a rule of liability that will severely damage manufacturing in our country.”

Whirlpool fell 1 percent to $119.37 in New York trading following the ruling, after climbing as much as 2.5 percent earlier in the session. The stock rose 19 percent this year before today.

The U.S. Supreme Court in April ordered the Sixth Circuit to reconsider an earlier ruling allowing the Whirlpool class- action suit, in light of its decision to disallow one against Philadelphia-based Comcast Corp., which was accused of monopolizing its hometown market.

The suing customers said Comcast swapped territories and subscribers with competitors to ensure it could control the market and charge higher prices. Comcast has denied the allegations.

The high court, ruling 5-4, said the customers didn’t meet requirements for outlining a common method that could be used to determine monetary damages for each of the thousands of individual parties to the lawsuit.

On reconsideration, the Cincinnati court reached the same conclusion it had earlier.

The case is In re Whirlpool Corp. Front-Loading Washer Products Liability Litigation, 08-wp-65000, U.S. District Court, Northern District of Ohio (Cleveland.) The appeal is Glazer v. Whirlpool, 10-4188, U.S. Court of Appeals for the Sixth Circuit (Cincinnati.)
(Editors: Andrew Dunn, Glenn Holdcraft)