In Re: Atlas Roofing Corporation Chalet Shingle Products Liability Litigation

MOTION for Summary Judgment as to Plaintiff Penny Seaberg with Brief In Support

N.D. Ga.July 12, 2017

WCSR 34885482v1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION IN RE: ATLAS ROOFING CORPORATION CHALET SHINGLE PRODUCTS LIABILITY LITIGATION ) ) ) ) ) MDL DOCKET NO. 2495 1:13-MD-2495-TWT ----------------------------------------------------------- PENNY SEABERG, on behalf of herself and all others similarly situated, Plaintiff, v. ATLAS ROOFING CORPORATION, Defendant. ) ) ) ) ) ) ) ) ) ) CIVIL ACTION FILE NO. 1:14-CV-03179-TWT ATLAS ROOFING CORPORATION’S MOTION FOR SUMMARY JUDGMENT AS TO PLAINTIFF PENNY SEABERG COMES NOW Defendant Atlas Roofing Corporation (“Atlas”), and pursuant to Fed. R. Civ. P. 56, hereby moves for summary judgment in its favor on Plaintiff Penny Seaberg’s remaining claims for violation of the Florida Deceptive & Unfair Trade Practices Act, FL Statutes §§ 501.201 et seq. (Count I), breach of express warranty (Count II), and declaratory relief (Count VIII), as well as attorneys’ fees and punitive damages. Case 1:13-md-02495-TWT Document 391 Filed 07/12/17 Page 1 of 4 WCSR 34885482v1 - 2 - This Motion for Summary Judgment is supported by the following: 1. Brief in Support of Atlas Roofing Corporation’s Motion for Summary Judgment, filed contemporaneously herewith; 2. Atlas Roofing Corporation’s L.R. 56.1(B) Statement of Material Facts As To Which There Is No Genuine Issue To Be Tried, and the attachments thereto, filed contemporaneously herewith; and 3. The pleadings and all other evidence properly before the Court. Respectfully submitted this 12th day of July, 2017. 271 17th Street, N.W. Suite 2400 Atlanta, GA 30363-1017 (404) 888-7435 direct phone (404) 870-4831 direct fax jpieper@wcsr.com jennifer.collins@wcsr.com WOMBLE CARLYLE SANDRIDGE & RICE, LLP By: /s/ Joel G. Pieper Joel G. Pieper Georgia Bar No. 578385 Jennifer S. Collins Georgia Bar No. 436806 5 Exchange Street Charleston, SC 29401 843-722-3400 phone 843-723-7398 fax hsmythe@wcsr.com jweatherholtz@wcsr.com WOMBLE CARLYLE SANDRIDGE & RICE, LLP Henry B. Smythe (Admitted Pro Hac) James E. Weatherholtz (Admitted Pro Hac) Attorneys for Atlas Roofing Corporation Case 1:13-md-02495-TWT Document 391 Filed 07/12/17 Page 2 of 4 WCSR 34885482v1 - 3 - LOCAL RULE 7.1 COMPLIANCE CERTIFICATE Pursuant to L.R. 7.1D, this is to certify that the foregoing pleading complies with the font and point selections approved by the Court in L.R. 5.1B. The foregoing pleading was prepared on a computer using the Times New Roman font (14 point). /s/ Joel G. Pieper Joel G. Pieper State Bar No. 578385 WOMBLE CARLYLE SANDRIDGE & RICE, LLP 271 17th Street, N.W. Suite 2400 Atlanta, GA 30363-1017 (404) 888-7435 direct phone (404) 870-4831 direct fax jpieper@wcsr.com Case 1:13-md-02495-TWT Document 391 Filed 07/12/17 Page 3 of 4 WCSR 34885482v1 CERTIFICATE OF SERVICE The undersigned hereby certifies that a true and correct copy of the within and foregoing ATLAS ROOFING CORPORATION’S MOTION FOR SUMMARY JUDGMENT AS TO PLAINTIFF PENNY SEABERG was electronically filed with the Clerk of Court using the CM/ECF system, which will automatically send email notification of such filing to the following attorneys of record: Kenneth S. Canfield, Esq. Plaintiffs’ Liaison Counsel DOFFERMYRE SHIELDS CANFIELD KNOWLES & DEVINE, LLC 1355 Peachtree Street, Suite 1600 Atlanta GA 30309 This 12th day of July, 2017. /s/ Joel G. Pieper Joel G. Pieper State Bar No. 578385 WOMBLE CARLYLE SANDRIDGE & RICE, LLP 271 17th Street, N.W. Suite 2400 Atlanta GA 30363-1017 (404) 888-7435 direct dial (404) 870-4831 direct fax jpieper@wcsr.com Case 1:13-md-02495-TWT Document 391 Filed 07/12/17 Page 4 of 4 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION IN RE: ATLAS ROOFING CORPORATION CHALET SHINGLE PRODUCTS LIABILITY LITIGATION ) ) ) ) ) MDL DOCKET NO. 2495 1:13-MD-2495-TWT ----------------------------------------------------------- PENNY SEABERG, on behalf of herself and all others similarly situated, Plaintiff, v. ATLAS ROOFING CORPORATION, Defendant. ) ) ) ) ) ) ) ) ) ) CIVIL ACTION FILE NO. 1:14-CV-03179-TWT BRIEF IN SUPPORT OF ATLAS ROOFING CORPORATION’S MOTION FOR SUMMARY JUDGMENT AS TO PLAINTIFF PENNY SEABERG Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 1 of 24 - i - Table of Contents I. Factual Background ......................................................................................... 2 II. Argument and Citation of Authorities ............................................................. 5 A. Plaintiff’s FDUTPA Claim Fails as a Matter of Law ........................... 5 1. Plaintiff’s FDUTPA Claim is Barred by the Statute of Limitations .................................................................................. 5 2. Plaintiff May Not Recover Replacement Costs Under FDUTPA ..................................................................................... 7 3. Causation Evidence Does Not Support Claim for Leak Related Damages......................................................................... 8 B. Because Atlas Did Not Deny Plaintiff’s Warranty Claim, Her Breach of Warranty Claim Fails as a Matter of Law ............................ 8 C. Attorney’s Fees and Punitive Damages Claim Fails ...........................10 D. Declaratory Relief Claim ....................................................................11 1. Redressability Requirement ......................................................11 2. The Seventh Amendment Issue ................................................13 3. Res Judicata ...............................................................................15 III. Conclusion .....................................................................................................17 Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 2 of 24 - ii - Table of Authorities Cases Allison v. Citgo Petroleum Corp., 151 F.3d 402 (5th Cir. 1998) ............................13 Chauffeurs, Teamsters &Helpers, Local No. 391 v. Terry, 494 U.S. 558, 110 S. Ct. 1339, 108 L. Ed. 2d 519 (1990) ...............................................................14 Curtis v. Loether, 415 U.S. 189 (1974) ............................................................ 14, 15 Goldstein v. Home Depot U.S.A., Inc., 609 F. Supp. 2d 1340 (N.D. Ga. 2009) .....15 Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204 (2002) ...................14 Licul v. Volkswagen Grp. of Am., Inc., 2013 WL 6328734 (S.D. Fla. Dec. 5, 2013) ........................................................................................................... 5, 6, 7 Marlborough Holdings Grp., Ltd. v. Azimut-Benetti, SPA, 505 F. App’x 899 (11th Cir. 2013) .................................................................................................... 5 Nilsen v. City of Moss Point, Miss., 701 F.2d 556 (5th Cir. 1983) ..........................16 Ragsdale v. Rubbermaid, Inc., 193 F.3d 1235 (11th Cir. 1999) ....................... 16, 17 Rollings, Inc. v. Butland, 951 So.2d 860 (Fla. Dist. Ct. App. 2006) ......................... 7 Skulas v. Loiselle, 2009 WL 4890661 (S.D. Fla. Dec. 17, 2009) ............................10 Speier-Roche v. Volkswagen Grp. of Am. Inc., 2014 WL 1745050 (S.D. Fla. Apr. 30, 2014) ..................................................................................................5, 6 Tulepan v. Roberts, 2015 WL 235441 (S.D. Fla. Jan. 16, 2015) ............................11 Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 102 S. Ct. 752, 70 L. Ed. 2d 700 (1982) .......................................................................................................... 12, 16 Warth v. Seldin, 422 U.S. 490, 95 S. Ct. 2197, 45 L. Ed. 2d 343 (1975) ................15 Williams v. Martin, 283 F. Supp. 2d 1286 (N.D. Ga. 2003) ....................................12 Statutes FL Stat. §§ 501.201 ..................................................................................................17 Fla. Stat. § 95.11(3)(f) ................................................................................................ 5 U.S. Const. Amend. VII ...........................................................................................12 Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 3 of 24 -iii- Rules Fed. R. Civ. P. 12(b)(6) ........................................................................................1, 11 Fed. R. Civ. P. 38(a).................................................................................................13 Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 4 of 24 Atlas Roofing Corporation (“Atlas”) moves for summary judgment on each of Plaintiff Penny Seaberg’s remaining claims for violation of the Florida Deceptive & Unfair Trade Practices Act (“FDUTPA”) (Count I), breach of express warranty (Count II), and declaratory relief (Count VIII).1 Ms. Seaberg’s FDUPTA claim is barred by the four year statute of limitations, and for lack of recoverable damages under FDUPTA. Plaintiff’s express warranty claim fails because Atlas paid her warranty claim under the Atlas Limited Warranty. Any warranty claim seeking damages caused by leaks also fails since Ms. Seaberg is unable to show that any such leak or resulting damage was caused by any alleged product defect in the Atlas Stratford shingles (“Shingles”) on her roof. Plaintiff’s claims for declaratory relief also fail because discovery has confirmed that, in the absence of monetary damages, declaratory relief would not redress any injury Ms. Seaberg claims to have sustained, and because seeking declarations to establish a basis to recover legal 1 A number of the claims asserted in Plaintiff Penny Seaberg’s Complaint were dismissed under Rule 12(b)(6), including her claims for injunctive relief asserted paragraphs 145(d), (e) and (f), as well as the claims in Count III (strict products liability, design defect, manufacturing defect and failure to warn); Count IV (negligence/negligent design); Count V (fraudulent concealment); Count VI (negligent misrepresentation); and Count VII (unjust enrichment) [MDL Dkt. 257]. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 5 of 24 -2- remedies would violate Atlas’s rights under the Seventh Amendment. Seaberg’s claims for attorney’s fees and punitive damages also fail as a matter of law. I. FACTUAL BACKGROUND Denis Murphy of Murphy Roofs (“Murphy”) installed Atlas shingles on Ms. Seaberg’s roof (the “Shingles”) in September 2004. [Ex. A, Penny Seaberg Deposition (“PS Depo.”), at 51:7-18; Ex. B, Plaintiff’s Answers to Interrogatories (“Int. Resp.”), Nos. 4, 5, 8 and 9]. 2 Prior to and at the time the Shingles were purchased and installed on her roof, Seaberg did not know the brand or manufacturer of the Shingles being installed. [Ex. A, PS Depo., at 48:20 – 49:2]. Ms. Seaberg did not read or see any Atlas brochures advertisements or promotional materials in connection with hiring Murphy to install the Shingles. [Ex. B, Int. Resp., No. 16]. She did not have any communications with Atlas prior to or at the time of the Shingle purchase or installation in 2004. [Ex. A, PS Depo., 51:19 – 52:11]. Although Ms. Seaberg contends that her roof has leaked due to allegedly “defective Shingles,” Plaintiff’s expert (Dean Rutila) is unable to identify a single instance where any alleged product defect caused a leak in any Shingle on any of 2 The exhibits cited herein are exhibits to Atlas’s Statement of Material Facts As To Which There Is No Genuine Issue To Be Tried, filed contemporaneously herewith. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 6 of 24 -3- the 351 Atlas roofs his firm inspected for this case (including the Seaberg roof). [Ex. B, Int. Resp., No. 6; Ex. G, Dean Rutila Deposition (“Rutila Depo.”), 85:6 – 86:9; 124:15-23; 167:12-19; 224:21 – 225:5]. A forensic inspection of the Seaberg roof also showed that each of the leaks reported by Plaintiff were entirely unrelated to any alleged product defect complained of in this case and were instead caused by installation and construction deficiencies, unrelated to the brand of shingles on the roof. [Ex. H, Rick Moore Expert Report, at Tab 9 – Seaberg, Biscayne Park, Florida pp. 3-5 (Leak Investigation)]. In December 2012, Plaintiff, through her roofer Murphy, submitted a warranty claim to Atlas. [Ex. E, 12/02/12 Letter from Murphy to Atlas]. Through Murphy, Ms. Seaberg complained During a recent inspection of this roof, it was found that an 11 x 43 foot, section of the roof shingles have lost their intigerity (sic). These shingles are in an area of the roof that is under a section of the neighbors’ Florida Oak Tree.... The shingle[s] have become porous and have begun to leak.” [Ex. E, 12/02/12 Letter from Murphy to Atlas]. On January 8, 2013, Atlas sent Plaintiff a check for her warranty claim in the amount of $1,536.42 for the prorated cost of 26 squares of replacement shingles plus $50.00 for claims assistance. [Ex. A, PS Depo., 82:19 – 83:18; Ex. F, 1/08/13 Letter from Atlas enclosing check]. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 7 of 24 -4- With respect to manufacturing defects, the applicable Atlas Limited Warranty warrants that the Shingles “are free from manufacturing defects, which result in leaks” and, during the first three years, provides for payment of “the replacement cost to the owner for the product plus replacement application cost (exclusive of metal work, flashing or other work)” and during the remaining portion of the 30 year warranty period, the warranty provides for prorated payment of the “replacement costs of the product ... in proration to the unexpired warranty period.” [Ex. C, Atlas Limited Warranty]. After Plaintiff received the check, she called Atlas to find out if Atlas was going to pay her any additional sums and was advised that the check covered the full amount of the prorated cost of replacement shingles. [Ex. A, PS Depo., 97:3- 17]. Plaintiff cashed the check without having any other communications with Atlas. [Ex. A, PS Depo., 83:11-18]. Approximately a year and a half after she accepted and cashed Atlas’s check in payment of her warranty claim, Plaintiff filed this lawsuit in July of 2014. [Civ. Action No. 1:14-CV-03179, Dkt. 1]. Although the Complaint alleges that Ms. Seaberg made a second warranty claim on January 17, 2014, Plaintiff admitted in her deposition that she had no other communications with Atlas after 2013. [Ex. A, PS Depo., 97:3 – 98:14]. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 8 of 24 -5- II. ARGUMENT AND CITATION OF AUTHORITIES A. Plaintiff’s FDUTPA Claim Fails as a Matter of Law 1. Plaintiff’s FDUTPA Claim is Barred by the Statute of Limitations Plaintiff’s FDUTPA claim is subject to a four year statute of limitations that started to run at the time the Shingles were purchased in or before September 2004.3 Fla. Stat. § 95.11(3)(f) (providing four year statute of limitations for “action founded on a statutory liability”); Licul v. Volkswagen Grp. of Am., Inc., No. 13- 61686-CIV, 2013 WL 6328734, at *6-7 (S.D. Fla. Dec. 5, 2013) (“The statute of limitations on a FDUTPA claim expires four years from the date of sale of the product at issue”). “A FDUTPA claim accrues at the time of purchase or lease of a product, not upon discovery of an alleged defect.” Speier-Roche v. Volkswagen Grp. of Am. Inc., 14-20107-CIV, 2014 WL 1745050, at *6 (S.D. Fla. Apr. 30, 2014); Licul, 2013 WL 6328734, at *6 (“the delayed discovery rule is inapplicable to FDUTPA claims”), citing Marlborough Holdings Grp., Ltd. v. Azimut-Benetti, SPA, 505 F. App’x 899, 905-06 (11th Cir. 2013). Since Plaintiff’s roofer purchased her Shingles no later than September 2004,4 the four-year statute of limitations expired in 2008. Fla. Stat. § 95.11(3)(f). 3 [See Ex. B, Int. Resp., No. 5 (Shingles installed in September 2004)]. 4 [See Ex. B, Int. Resp., No. 5]. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 9 of 24 -6- Plaintiff did not file this action until July 2014, almost 10 years after the purchase of the product and approximately six years after her FDUTPA claim had already become time barred. [Ex. B, Int. Resp., No. 5; Civ. Action No. 1:14-CV-03179, Dkt. 1]. Ms. Seaberg cannot rely on “equitable estoppel” to toll the limitations period applicable to her FDUTPA claim, since such tolling requires Ms. Seaberg to show that she was “aware that [she] has a cause of action during the limitations period, but forbears from bringing suit because of the defendant's misrepresentations.” Licul, 2013 WL 6328734, at *6. There is no evidence that Ms. Seaberg was aware that she had any cause of action during the four year limitations period (2004 to 2008), much less that she refrained from filing a lawsuit during this limitations period in reliance on any such misrepresentation by Atlas. [Ex. A, PS Depo., 88:3- 16]. Likewise, Ms. Seaberg cannot rely on “fraudulent concealment” to toll the statute of limitations, since she cannot show that “Defendant deliberately and actively concealed the material facts for the purpose of inducing her to delay filing this action.” Speier-Roche, 2014 WL 1745050, at *7. Here Plaintiff asserts only “a claim of mere ‘nondisclosure’ which, under Florida law, is legally insufficient to toll the statute of limitations.” Id. [See Ex. A, PS Depo., 102:15-25]. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 10 of 24 -7- Accordingly, regardless of Plaintiff’s tolling theories, Atlas is entitled to summary judgment on Plaintiff’s FDUTPA claim because the four year statute of limitations expired on this claim in 2008. 2. Plaintiff May Not Recover Replacement Costs Under FDUTPA Apart from being time barred, FDUTPA requires Plaintiff to establish that conduct in violation of FDUTPA was the cause of the actual damages that Ms. Seaberg alleges she sustained. Licul, 2013 WL 6328734 at *5; see also, this Court’s 6/09/17 Opinion and Order, 1:13-md-02495, Dkt. 374, p. 30 (“The FDUPTA requires that a plaintiff prove actual damages”). “Because the FDUPTA requires actual damages, it bars recovery of consequential damages.” 6/09/17 Opinion and Order, 1:13-md-02495, Dkt. 374, p. 30, citing Rollings, Inc. v. Butland, 951 So.2d 860, 869 (Fla. Dist. Ct. App. 2006). “‘FDUPTA’s bar on recovery of consequential damages precludes the recovery of the costs to repair’ the class members’ roofs.” 6/09/17 Opinion and Order, 1:13-md-02495, Dkt. 374, p. 30, quoting Rollings, 951 So.2d at 869-870. Here, Plaintiff contends that her roof has leaked, allegedly due to “defective Shingles,” and seeks damages for the roof replacement and repairs. [Ex. B, Int. Resp., No. 7]. Under the authorities cited above, the replacement cost damages Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 11 of 24 -8- Plaintiff seeks are not recoverable under FDUTPA. Plaintiff’s claims for such replacement costs fail as a matter of law accordingly. 3. Causation Evidence Does Not Support Claim for Leak Related Damages Ms. Seaberg is unable to show that any leaks she sustained were due to any alleged product defect in the Shingles. [Ex. G, Rutila Depo., 85:6 – 86:9; 124:15- 23; 167:12-19; 224:21 – 225:5]. The evidence instead shows that such leaks were caused by installation and construction deficiencies, unrelated to the brand or performance of the Shingles. [Ex. H, Rick Moore Expert Report, at Tab 9 – Seaberg, Biscayne Park, Florida pp. 3-5 (Leak Investigation); Ex. G, Rutila Depo., 115:23 – 119:11]. Accordingly, to the extent that Plaintiff seeks to recover on her FDUTPA claim for damages caused by leaks, such claim also fails as a matter of law for lack of any material issue of fact on the causation element. B. Because Atlas Did Not Deny Plaintiff’s Warranty Claim, Her Breach of Warranty Claim Fails as a Matter of Law Plaintiff’s breach of warranty claim fails because Atlas paid Ms. Seaberg’s claim under the Atlas Limited Warranty for the 11 x 43 square foot section of her roof about which she complained. [Ex. E, 12/02/12 Letter from Murphy to Atlas]. There is no dispute that Atlas sent Ms. Seaberg a check for her warranty claim on January 8, 2013, in the amount of $1,536.42 for the prorated cost of 26 squares of Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 12 of 24 -9- replacement shingles plus $50.00 for claims assistance as provided under the Atlas Limited Warranty. [Ex. A, PS Depo., 82:19 – 83:18; Ex. F, 1/08/13 Letter from Atlas enclosing check]. The Atlas Limited Warranty sets forth a payment schedule that is prorated over a 30-year period so that the amount available for a leak that occurs in year 20 would be less than had it occurred in year 3. This prorated payment schedule is typical of warranties issued for roofing shingles by other manufacturers since a claimant with a leak claim in year 20 would have already received the value of 19 years of leak free performance that a claimant in year 3 would not have received. [See Ex. D, comparison of manufacturer warranties in Expert Report of Professor George L. Priest, attached at Exhibit J to Response in Opposition to Plaintiffs’ Motion for Class Certification, 1:13-cv-02195, Dkt. 59-11, at p. 18 (“Following the defined period of labor coverage, each of the competing manufacturers provides for materials coverage to be pro-rated over the remaining term of the warranty, as explained, to account for the value received to that point by the consumer since application of the shingles”)]. Since Atlas paid Ms. Seaberg’s claim under the terms of the Atlas Limited Warranty, her breach of warranty claim fails as a matter of law. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 13 of 24 -10- Any warranty claim for leak related damage also fails because Ms. Seaberg is unable to show that any leaks she sustained were due to any alleged product defect in the Shingles. As noted above, the evidence shows that the leaks in her roof were caused by installation and construction deficiencies, unrelated to the brand or performance of the Shingles. [Ex. H, Rick Moore Expert Report, at Tab 9 – Seaberg, Biscayne Park, Florida pp. 3-5 (Leak Investigation); Ex. G, Rutila Depo., 115:23 – 119:11]. C. Attorney’s Fees and Punitive Damages Claim Fails Plaintiff claims a right to recover attorney’s fees and punitive damages. [Comp., ¶¶ 4, 85, 109, p. 28]. “Generally, under Florida law, attorney’s fees incurred while prosecuting or defending a claim are not recoverable in the absence of a statute or contractual agreement authorizing their recovery.” Skulas v. Loiselle, No. 09-60096-CIV, 2009 WL 4890661, at *5 (S.D. Fla. Dec. 17, 2009) (granting summary judgment on claim for attorneys’ fees where “Plaintiff has not provided a statutory or contractual basis for his claim for attorneys' fees”) (internal citations omitted). Because the FDUPTA claim fails as a matter of law, there is no contractual or statutory basis for an award of attorney’s fees. Thus, Plaintiff’s claim for attorney’s fees fails as a matter of law. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 14 of 24 -11- Additionally, “[u]nder Florida law, punitive damages are not recoverable in a breach of contract action absent an accompanying underlying tort.” Tulepan v. Roberts, No. 14-CV-80574, 2015 WL 235441, at *16 (S.D. Fla. Jan. 16, 2015) (granting summary judgment on punitive damages claim where “summary judgment has been granted in favor of Defendant as to all of Plaintiff's tort claims and only contract claims remain”). Because all of Plaintiff’s tort claims fail as a matter of law or have already been dismissed, there is no basis for an award of punitive damages, and Plaintiff’s claim for punitive damages likewise fails as a matter of law. D. Declaratory Relief Claim In connection with Atlas’s Rule 12(b)(6) motion to dismiss Plaintiff’s claims for declaratory relief due to a lack of Article III standing, the Court previously decided to allow Plaintiff’s declaratory relief claim to survive “for now” under the notice pleading standard governing such motions. [No. 1:13-md-02495, Dkt. 257, p. 8]. Atlas now moves for dismissal of the declaratory relief claim on summary judgment. 1. Redressability Requirement Under the redressability requirement for Article III standing, Penny Seaberg may not seek to recover declaratory relief unless she claims to have sustained an Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 15 of 24 -12- injury “that is likely to be remedied by a favorable decision of the court.” Williams v. Martin, 283 F. Supp. 2d 1286, 1290 (N.D. Ga. 2003), citing Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 471-72, 102 S. Ct. 752, 70 L. Ed. 2d 700 (1982). With respect to her damages, Ms. Seaberg testified that she has sustained damage from roof leaks and that she seeks to recover the costs of replacing her roof and making repairs to water stained materials. [Ex. A, PS Depo., 106:20 – 108:10; see also Ex. B, Int. Resp., No. 7]. In the absence of any money damages, the recovery of declaratory relief by itself would not redress any loss or damage Ms. Seaberg claims to have sustained. Ms. Seaberg may not recover a declaratory judgment in order to establish a basis to recover money damages under legal claims. Since Ms. Seaberg’s legal claims all fail on summary judgment for the reasons set forth above, she could not use the declaratory relief to establish a basis for recovering on such failed legal claims. Even if any of her legal claims were not dismissed on summary judgment, Ms. Seaberg could not recover declaratory relief in order to support a claim for legal relief since, in the context of this case, such simultaneous adjudication would violate Atlas’s rights under the Seventh Amendment, as explained below. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 16 of 24 -13- 2. The Seventh Amendment Issue “In suits at common law ... the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined ....” U.S. Const. Amend. VII. “The right of trial by jury as declared by the Seventh Amendment to the Constitution—or as provided by a federal statute—is preserved to the parties inviolate.” Fed. R. Civ. P. 38(a). Due to the disputed factual issues that her legal claims share in common with the claims for declaratory relief, they cannot both be simultaneously adjudicated in this case without impinging upon Atlas’s right to have any such jury issues tried only to a jury. While it may be possible in some cases to simultaneously recover both legal relief and declarations, such simultaneous recovery violates the Seventh Amendment where, as here, there are common factual issues underlying the legal claims and the claims for declaratory relief. “When claims involving both legal and equitable rights are properly joined in a single case, the Seventh Amendment requires that all factual issues common to these claims be submitted to a jury for decision on the legal claims before the final court determination of the equitable claims.” Allison v. Citgo Petroleum Corp., 151 F.3d 402, 423-24 (5th Cir. 1998) (emphasis added). Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 17 of 24 -14- Ms. Seaberg’s legal claims share the same disputed factual basis (e.g., alleged product defect and alleged failure to disclose an alleged product defect).5 Since trial of the legal claims would necessitate fact finding by the jury on factual disputes that would also be at issue in connection with the declaratory relief, Ms. Seaberg could not simultaneously pursue the declarations and her legal claims without violating Atlas’s Seventh Amendment right to have such factual disputes tried to a jury.6 “[I]f [a] legal claim is joined with an equitable claim, the right to jury trial on the legal claim, including all issues common to both claims, remains intact.” Curtis v. Loether, 415 U.S. 189, 198 (1974) (emphasis added). Thus, if Ms. Seaberg’s legal claims were not dismissed on summary judgment, the jury would ultimately have to decide the factual disputes underlying both the legal and declaratory claims; and the trial court could not take the jury’s place as the fact finder without violating the Defendant’s right to have such facts 5 In support of the claims for declaratory relief, the Complaint expressly incorporates all the factual allegations asserted in support of each of Ms. Seaberg’s legal claims. [Compl., ¶ 143]. 6 The right to a jury trial applies where legal rights are to be ascertained. See, e.g., Chauffeurs, Teamsters &Helpers, Local No. 391 v. Terry, 494 U.S. 558, 110 S. Ct. 1339, 1344, 108 L. Ed. 2d 519 (1990). “Almost invariably ... suits seeking (whether by judgment, injunction, or declaration) to compel the defendant to pay a sum of money to the plaintiff are suits for money damages and money damages are, of course, the classic form of legal relief.” Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204, 210 (2002) (internal cites omitted). Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 18 of 24 -15- tried to the jury under the Seventh Amendment. Id. Thus, under the Seventh Amendment, Ms. Seaberg may not ask a court to decide any disputed issues that form the factual basis of her legal claims in order to adjudicate the declaratory relief claims. Even if Ms. Seaberg were allowed to drop her legal claims to avoid the Seventh Amendment issue, doing so would not resolve her lack of Article III standing. As noted above, in the absence of corresponding legal relief, a grant of declaratory relief would not redress any loss or injury claimed by Penny Seaberg, and she would therefore lack any standing to pursue them. Goldstein v. Home Depot U.S.A., Inc., 609 F. Supp. 2d 1340, 1348 (N.D. Ga. 2009) (plaintiff lacked standing since “[t]he injunction proposed by Plaintiff, if granted, would in no way benefit Plaintiff”); Warth v. Seldin, 422 U.S. 490, 499, 95 S. Ct. 2197, 2205, 45 L. Ed. 2d 343 (1975) (“Art. III judicial power exists only to redress or otherwise to protect against injury to the complaining party, even though the court's judgment may benefit others collaterally”). 3. Res Judicata As noted above, in order to have Article III standing to seek declaratory relief, Ms. Seaberg would have to have an injury that is “likely” to be remedied if a declaration were to be granted. Valley Forge Christian College, 454 U.S. at 471- Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 19 of 24 -16- 72, 102 S. Ct. 752, 70 L. Ed. 2d 700 (redressability requires that a plaintiff have an injury “that is likely to be remedied by a favorable decision of the court”). Even if Ms. Seaberg could somehow recover only declaratory relief in this case, such recovery would not make it likely that she would later recover money damages in any subsequent case since such discarded claims would be barred by res judicata if she later attempted to assert them in another case. Since her legal claims and the declarations at issue both arise out of same nucleus of operative facts, if she dropped any legal claims in this case, she would be barred by res judicata from ever pursuing her discarded legal claims in any subsequent trial. Nilsen v. City of Moss Point, Miss., 701 F.2d 556, 560 (5th Cir. 1983) (under principles of res judicata, “one who has a choice of more than one remedy for a given wrong ... may not assert them serially, in successive actions, but must advance all at once on pain of bar”); Ragsdale v. Rubbermaid, Inc., 193 F.3d 1235, 1238 (11th Cir. 1999) (once a claim is adjudicated in an earlier case, res judicata bars the assertion of any claims in a subsequent proceeding that arises out of the same nucleus of operative facts as the previously adjudicated claim). There can be no dispute that Ms. Seaberg’s legal claims arise out of the same nucleus of operative facts as her claims for declaratory relief. The Court noted in its prior order that issuing the declarations “would establish an essential component Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 20 of 24 -17- to liability” under Plaintiff’s legal claims. [No. 1:13-md-02495, Dkt. 257, p. 7]. Since Ms. Seaberg’s legal claims and her claims seeking declaratory relief arise out of the same nucleus of operative facts, once her claim for declaratory relief is adjudicated, she would be barred by res judicata from raising her corresponding legal claims in any subsequent trial. Ragsdale, 193 F.3d at 1239 (“It is now said, in general, that if a case arises out of the same nucleus of operative fact, or is based upon the same factual predicate, as a former action, that the two cases are really the same ‘claim’ or ‘cause of action’ for purposes of res judicata”). Thus, the declarations cannot satisfy the redressibility requirement by establishing an essential element of Ms. Seaberg’s other claims for money damages. III. CONCLUSION For all of the reasons set forth above, Atlas moves the Court to enter summary judgment in favor of Atlas dismissing all of Ms. Seaberg’s remaining claims, including her claims for violation of the Florida Deceptive & Unfair Trade Practices Act, FL Statutes §§ 501.201 et seq. (Count I), breach of express warranty (Count II), declaratory relief (Count VIII), as well as her claim for attorneys’ fees and punitive damages. Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 21 of 24 -18- Respectfully submitted this 12th day of July, 2017. 271 17th Street, N.W. Suite 2400 Atlanta, GA 30363-1017 (404) 888-7435 direct phone (404) 870-4831 direct fax jpieper@wcsr.com jennifer.collins@wcsr.com WOMBLE CARLYLE SANDRIDGE & RICE, LLP By: /s/ Joel G. Pieper Joel G. Pieper Georgia Bar No. 578385 Jennifer S. Collins Georgia Bar No. 436806 5 Exchange Street Charleston, SC 29401 843-722-3400 phone 843-723-7398 fax hsmythe@wcsr.com jweatherholtz@wcsr.com WOMBLE CARLYLE SANDRIDGE & RICE, LLP Henry B. Smythe (Admitted Pro Hac) James E. Weatherholtz (Admitted Pro Hac) Attorneys for Atlas Roofing Corporation Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 22 of 24 -19- LOCAL RULE 7.1 COMPLIANCE CERTIFICATE Pursuant to L.R. 7.1D, this is to certify that the foregoing pleading complies with the font and point selections approved by the Court in L.R. 5.1B. The foregoing pleading was prepared on a computer using the Times New Roman font (14 point). /s/ Joel G. Pieper Joel G. Pieper State Bar No. 578385 WOMBLE CARLYLE SANDRIDGE & RICE, LLP 271 17th Street, N.W. Suite 2400 Atlanta, GA 30363-1017 (404) 888-7435 direct phone (404) 870-4831 direct fax jpieper@wcsr.com Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 23 of 24 CERTIFICATE OF SERVICE The undersigned hereby certifies that a true and correct copy of the within and foregoing BRIEF IN SUPPORT OF ATLAS ROOFING CORPORATION’S MOTION FOR SUMMARY JUDGMENT AS TO PLAINTIFF PENNY SEABERG was electronically filed with the Clerk of Court using the CM/ECF system, which will automatically send email notification of such filing to the following attorneys of record: Kenneth S. Canfield, Esq. Plaintiffs’ Liaison Counsel DOFFERMYRE SHIELDS CANFIELD KNOWLES & DEVINE, LLC 1355 Peachtree Street, Suite 1600 Atlanta GA 30309 This 12th day of July, 2017. /s/ Joel G. Pieper Joel G. Pieper State Bar No. 578385 WOMBLE CARLYLE SANDRIDGE & RICE, LLP 271 17th Street, N.W. Suite 2400 Atlanta GA 30363-1017 (404) 888-7435 direct dial (404) 870-4831 direct fax jpieper@wcsr.com Case 1:13-md-02495-TWT Document 391-1 Filed 07/12/17 Page 24 of 24 WCSR 34885511v1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION IN RE: ATLAS ROOFING CORPORATION CHALET SHINGLE PRODUCTS LIABILITY LITIGATION ) ) ) ) ) MDL DOCKET NO. 2495 1:13-MD-2495-TWT ----------------------------------------------------------- PENNY SEABERG, on behalf of herself and all others similarly situated, Plaintiff, v. ATLAS ROOFING CORPORATION, Defendant. ) ) ) ) ) ) ) ) ) ) CIVIL ACTION FILE NO. 1:14-CV-03179-TWT ATLAS ROOFING CORPORATION’S L.R. 56.1(B) STATEMENT OF MATERIAL FACTS AS TO WHICH THERE IS NO GENUINE ISSUE TO BE TRIED IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT AS TO PLAINTIFF PENNY SEABERG COMES NOW Defendant Atlas Roofing Corporation (“Atlas”), and in support of its Motion for Summary Judgment, sets forth the following statement of material facts as to which there is no genuine issue to be tried, as required under the Northern District of Georgia Local Rule 56.1(B). Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 1 of 10 WCSR 34885511v1 - 2 - 1. Penny Seaberg and her husband replaced the roof of their home with Atlas Stratford brand shingles (the “Shingles”) in September 2004. [Ex. A, Penny Seaberg Depo. (“PS Depo.”), at 34:13-22; Ex. B, Plaintiff’s Answers to Interrogatories (“Int. Resp.”), No. 5]. 2. Murphy Roofs (“Murphy”) purchased the Shingles and installed them on the Seaberg’s roof. [Ex. A, PS Depo., at 51:07-18]. 3. The Seabergs paid Murphy $7,700 for the replacement of their roof with the Shingles. [Ex. A, PS Depo., at 55:05-10]. 4. The Shingles were recommended, selected, and purchased by Ms. Seaberg’s roofer, Murphy. [Ex. A, PS Depo., 48:06 – 49:11; Ex. B, Int. Resp., No. 4 (“Plaintiff was not involved in selecting the Shingles as the brand of shingles to be installed ….”), and No. 9 (Plaintiff not involved in purchase of Shingles)]. Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 2 of 10 WCSR 34885511v1 - 3 - 5. Prior to and at the time the Shingles were purchased and installed on her roof, Ms. Seaberg did not know the brand or manufacturer of the Shingles being installed. [Ex. A, PS Depo., at 48:20 – 49:02]. 6. Ms. Seaberg reviewed the colors available to make a color selection for the Shingles without reviewing other information about the Shingles. [Ex. A, PS Depo., 49:03-16; Ex. B, Int. Resp., No. 16]. 7. Ms. Seaberg did not have any communications with Atlas prior to or at the time of the Shingle installation in 2004. [Ex. A, PS Depo., 51:19 – 52:11]. 8. The Shingles were subject to the Atlas Limited Warranty attached hereto with effective date January 1, 2002. [Ex. C, Atlas Limited Warranty]. 9. The Atlas Limited Warranty attached hereto warrants that the Shingles “are free from manufacturing defects, which result in leaks.” [Ex. C, Atlas Limited Warranty]. Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 3 of 10 WCSR 34885511v1 - 4 - 10. If there is a covered defect during the first three years on the roof, the Atlas Limited Warranty attached hereto provides for payment of “the replacement cost to the owner for the product plus replacement application cost (exclusive of metal work, flashing or other work)” subject to the terms thereof, and during the remaining warranty period of 30 years, the warranty provides for prorated payment of the “replacement costs of the product ... in proration to the unexpired warranty period.” [Ex. C, Atlas Limited Warranty]. 11. A prorated payment schedule for covered claims is typical of product warranties issued by other manufacturers of roofing shingles. [See Ex. D, comparison of manufacturer warranties in Expert Report of Professor George L. Priest, attached at Exhibit J to Response in Opposition to Plaintiffs’ Motion for Class Certification, 1:13-cv-02195, Dkt. 59-11, at p. 18 (“Following the defined period of labor coverage, each of the competing manufacturers provides for materials coverage to be pro-rated over the remaining term of the warranty, as explained, to account for the value received to that point by the consumer since application of the shingles”)]. Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 4 of 10 WCSR 34885511v1 - 5 - 12. In December 2012, Ms. Seaberg, through Murphy, submitted a warranty claim to Atlas. [Ex. E, 12/02/12 Letter from Murphy to Atlas]. 13. Murphy’s December 2012 letter to Atlas claimed that: “During a recent inspection of this roof, it was found that an 11 x 43 foot, section of the roof shingles have lost their intigerity (sic). These shingles are in an area of the roof that is under a section of the neighbors’ Florida Oak Tree.... The shingle[s] have become porous and have begun to leak.” [Ex. E, 12/02/12 Letter from Murphy to Atlas]. 14. On January 8, 2013, Atlas sent Ms. Seaberg a check for her warranty claim in the amount of $1,536.42 for the prorated cost of 26 squares of replacement shingles plus $50.00 for claims assistance. [Ex. A, PS Depo., 82:19 – 83:03; Ex. F, 1/08/13 Letter from Atlas enclosing check]. 15. After Ms. Seaberg received the check, she called Atlas to find out if Atlas was going to pay her any additional sums and was advised that the check covered the full amount of the prorated cost of replacement shingles. [Ex. A, PS Depo., Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 5 of 10 WCSR 34885511v1 - 6 - 97:03-15]. Ms. Seaberg had no other communications with Atlas. [Ex. A, PS Depo., 97:18 – 98:14]. 16. Ms. Seaberg cashed the check she received from Atlas. [Ex. A, PS Depo., 83:11-18]. 17. Ms. Seaberg filed this lawsuit in July of 2014. [Dkt. 1, Civ. Action No. 1:14-CV-03179]. 18. Ms. Seaberg seeks damages for the costs of the original roof, replacement roof and repair to the interior of her home. [Ex. B, Int. Resp., No. 7; Ex. A, PS Depo., 106:20 – 108:10]. 19. Plaintiff’s expert (Dean Rutila) is unable to identify a single instance where any alleged product defect caused a leak in any Shingle on any of the 351 Atlas roofs his firm inspected for this case (including the Seaberg roof). [Ex. B, Int. Resp., No. 6; Ex. G, Dean Rutila Deposition (“Rutila Depo.”), 85:06 – 86:09; 124:15-23; 167:12-19; 224:21 – 225:05]. Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 6 of 10 WCSR 34885511v1 - 7 - 20. A forensic inspection of the Seaberg roof showed that each of the leaks reported by Ms. Seaberg were entirely unrelated to any alleged product defect complained of in this case and were instead caused by installation and construction deficiencies, unrelated to the brand of Shingles on the roof. [Ex. H, Rick Moore Expert Report, at Tab 9 – Seaberg, Biscayne Park, Florida, pp. 3-5 (Leak Investigation); Ex. G, Rutila Depo., 115:23 – 119:11]. 21. Ms. Seaberg first thought she may have a potential defect in her Atlas shingles in 2012. [Ex. A, PS Depo., 88:03-16]. 22. Ms. Seaberg asserts that Atlas failed to disclose “a defective shingle” but does not identify any affirmative misrepresentations by Atlas upon which she relied. [Ex. A, PS Depo., 97:18 – 98:14, 49:03-16, 51:19 – 52:11, 102:15-25; Ex. B, Int. Resp., No. 16]. [Signatures of Counsel appear on next page] Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 7 of 10 WCSR 34885511v1 - 8 - Respectfully submitted this 12th day of July, 2017. 271 17th Street, N.W. Suite 2400 Atlanta, GA 30363-1017 (404) 888-7435 direct phone (404) 870-4831 direct fax jpieper@wcsr.com jennifer.collins@wcsr.com WOMBLE CARLYLE SANDRIDGE & RICE, LLP By: /s/ Joel G. Pieper Joel G. Pieper Georgia Bar No. 578385 Jennifer S. Collins Georgia Bar No. 436806 5 Exchange Street Charleston, SC 29401 843-722-3400 phone 843-723-7398 fax hsmythe@wcsr.com jweatherholtz@wcsr.com WOMBLE CARLYLE SANDRIDGE & RICE, LLP Henry B. Smythe (Admitted Pro Hac) James E. Weatherholtz (Admitted Pro Hac) Attorneys for Atlas Roofing Corporation Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 8 of 10 WCSR 34885511v1 - 9 - LOCAL RULE 7.1 COMPLIANCE CERTIFICATE Pursuant to L.R. 7.1D, this is to certify that the foregoing pleading complies with the font and point selections approved by the Court in L.R. 5.1B. The foregoing pleading was prepared on a computer using the Times New Roman font (14 point). /s/ Joel G. Pieper Joel G. Pieper State Bar No. 578385 WOMBLE CARLYLE SANDRIDGE & RICE, LLP 271 17th Street, N.W. Suite 2400 Atlanta, GA 30363-1017 (404) 888-7435 direct phone (404) 870-4831 direct fax jpieper@wcsr.com Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 9 of 10 WCSR 34885511v1 CERTIFICATE OF SERVICE The undersigned hereby certifies that a true and correct copy of the within and foregoing ATLAS ROOFING CORPORATION’S L.R. 56.1(B) STATEMENT OF MATERIAL FACTS AS TO WHICH THERE IS NO GENUINE ISSUE TO BE TRIED IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT AS TO PLAINTIFF PENNY SEABERG was electronically filed with the Clerk of Court using the CM/ECF system, which will automatically send email notification of such filing to the following attorneys of record: Kenneth S. Canfield, Esq. Plaintiffs’ Liaison Counsel DOFFERMYRE SHIELDS CANFIELD KNOWLES & DEVINE, LLC 1355 Peachtree Street, Suite 1600 Atlanta GA 30309 This 12th day of July, 2017. /s/ Joel G. Pieper Joel G. Pieper State Bar No. 578385 WOMBLE CARLYLE SANDRIDGE & RICE, LLP 271 17th Street, N.W. Suite 2400 Atlanta GA 30363-1017 (404) 888-7435 direct dial (404) 870-4831 direct fax jpieper@wcsr.com Case 1:13-md-02495-TWT Document 391-2 Filed 07/12/17 Page 10 of 10 EXHIBIT “A” Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 1 of 17 1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA 2 ATLANTA DIVISION 3 CASE NO. 8:12-CV-1286-T-30EAJ 4 IN RE: ATLAS ROOFING MDL DOCKET NO. 2495 5 CORPORATION CHALET SHINGLE 1:13-MD-2495-TWT PRODUCTS LIABILITY LITIGATION 6 -------------------------------- PENNY SEABERG, on behalf of 7 herself and all others similarly situated, 8 9 Plaintiff, CIVIL ACTION FILE NO: 1:14-CV-03179-TWT 10 vs. 11 ATLAS ROOFING CORPORATION 12 Defendant. 13 -----------------------------/ 14 15 1550 N.E. Miami Gardens Drive Suite 304 16 North Miami, Florida Friday, 9:45 a.m. 17 January 23, 2015 18 19 VIDEO DEPOSITION OF PENNY SEABERG 20 Taken on behalf of the Defendant before Bonnie L. 21 Winkelman, Shorthand Reporter and Notary Public for the 22 State of Florida at Large, pursuant to a notice of 23 taking deposition filed in the above cause. 24 25 Page 1 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 2 of 17 1 Q Okay. And would they -- tell me about that? 2 A The trees lose their leaves, the tree in the 3 front and the oak tree as well and they were usually 4 everywhere. 5 Q Okay. And you would notice them on the roof? 6 A I'm assuming they were there. I don't think I 7 ever paid attention to see how many or what was up 8 there, no. 9 Q Okay. Generally the roof is not something you 10 pay much attention to? 11 MR. CHAIKIN: Objection to form. 12 THE WITNESS: Correct. 13 Q Since 2004 or around 2004 when the shingled 14 roof was put on have you noticed any -- well, what have 15 you noticed about the look of the roof when you have 16 noticed it? 17 MR. CHAIKIN: Objection to form. 18 Q Generally describe the look of the roof? 19 A Right now? 20 Q Well, describe it when it was put on in 2004; 21 if you can? 22 A It looked nice. 23 Q And what about today? 24 A It doesn't look the same. 25 Q What changes have you noticed? Page 34 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 3 of 17 1 A No. 2 Q The -- what color are the shingles? 3 A Brown. 4 Q And who made that choice? 5 A We all did. 6 Q After Mr. Murphy made his recommendation with 7 the type of shingle that would be acceptable to the 8 Village and came recommended from human sources that he 9 talked to, other than selecting the color did you have 10 any -- did you make any decisions about the shingles? 11 MR. CHAIKIN: Objection to form. 12 THE WITNESS: No. 13 Q Other than selecting the color of the shingles 14 did you make any decision about the shingles? 15 A No. 16 Q Do you recall whether your husband made any 17 decisions about the shingles, other than participating 18 in the color? 19 A I don't recall. 20 Q When the shingles were selected did you know 21 the manufacturer's name? 22 A I don't think so. 23 Q Okay. When the shingles were selected did you 24 know the type of shingle? 25 A I knew it was going to be dimensional. Page 48 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 4 of 17 1 Q Okay. But you didn't -- 2 A That was all. 3 Q Okay. Mr. Murphy didn't show you any 4 literature about the shingles? 5 A I saw a brochure with the colors. Other than 6 that I don't believe so. 7 Q And the brochure -- if the brochure had 8 information other than the colors all you looked at was 9 the colors to make the selection? 10 MR. CHAIKIN: Objection to form. 11 THE WITNESS: Yes. 12 Q After -- well, in the process when the shingles 13 were put on, say in the month when he comes and puts 14 them on and takes the old off and puts the new shingles 15 on did you get any product information at that time? 16 A No. 17 Q Any warranty information? 18 A He had mentioned warranty when we selected the 19 roof. 20 Q Okay. 21 A We talked about the roof. He did say that 22 there was a 30-year warranty. 23 Q Okay. But he didn't give you a copy of it? 24 A No. 25 Q And when the shingles came you didn't get a Page 49 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 5 of 17 1 about a 30-year warranty. Did anybody else make any 2 other representations to you about the shingles? 3 A No. 4 Q Do you have any understanding of the difference 5 between an overlay shingle and an architectural shingle? 6 A No, I don't. 7 Q Do you know if Mr. Murphy purchased the 8 shingles or if you the Seabergs purchased the shingles 9 for the reroofing in 2004? 10 A Mr. Murphy purchased them. 11 Q Do you know where he got them? 12 A ABC Supply. I saw an invoice. 13 Q Did you have any relationship with ABC Supply 14 before that? 15 A No. 16 Q It wasn't your recommendation that he buy them 17 from ABC Supply? 18 A No. 19 Q Prior to Mr. Murphy doing the shingle project 20 around 2004 did you have any conversations with anybody 21 that you thought was a representative of Atlas? 22 A No. 23 Q And after they were installed have you had any 24 conversations with anybody you thought was a 25 representative of Atlas? Page 51 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 6 of 17 1 A Since? 2 Q 2004. 3 A Until now? 4 Q Yes. 5 A I spoke to somebody on the phone at Atlas. 6 Q Okay and was that around 2012? 7 A Correct. 8 Q Between 2004 and 2012 did you have any 9 conversations or correspondence with anybody you thought 10 was a representative of Atlas? 11 A No. 12 MR. MUNSON: Let's take a break. 13 (Recess) 14 (Thereupon, Defendant's Exhibit 5 was marked 15 for identification.) 16 Q Mrs. Seaberg, I am handing you what I have 17 marked as Deposition Exhibit 5 to your deposition. It 18 is about three pages of documentation from around the 19 time period when the asphalt shingle roof was put on 20 your home. The first page is an ABC Supply Company 21 invoice or warehouse pickup ticket. And at the bottom 22 it appears to have the property owner's signature. Is 23 that your signature, Penny Seaberg? 24 A Yes. 25 Q And is this just you signing taking delivery of Page 52 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 7 of 17 1 whether that is what it cost? 2 A No, that is not what it cost. 3 Q Did it cost more than that? 4 A Yes, it did. 5 Q What did it cost? 6 A I believe the figure was $7,700. 7 Q Okay. That is what the cost of -- to replace 8 the new gravel roof with the asphalt shingle roof was in 9 2004? 10 A Correct. 11 Q And there it says signature of owner or agent; 12 is that your husband's signature? 13 A Yes. 14 Q Over the top it says owner's name and it says 15 Fred Seaberg; do you see that? 16 A I do. 17 Q Who does own the house? 18 A Both of us. 19 Q Okay. Do you know, this is maybe legalese that 20 you don't know, but do you know in what capacity the two 21 of you own the house? 22 A I don't understand the question. 23 Q So there are ways to own a house like joint 24 tendency, tendency by the entirety, co-tenants; do you 25 know how the two of you own it? Page 55 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 8 of 17 1 You previously testified you can't see up on 2 the roof, but is that generally the view you can get? 3 A Uh-huh. 4 Q And that's generally what it looks like? 5 A Uh-huh. 6 Q You need to answer yes or no. 7 A Yes. Sorry. 8 Q Do you remember whether you or Mr. Murphy got a 9 response from Atlas from this submission of the shingles 10 in this packet? 11 A Yes, I did. 12 Q Did you get a response? 13 A Yes. 14 Q What was that? 15 A It was a letter with a check. 16 Q Okay. Between the time -- well, let's -- 17 (Thereupon, Defendant's Exhibit 9 was marked 18 for identification.) 19 Q Well, let's see if I have that. I'm showing 20 you what I marked Exhibit 9 to your deposition. Is that 21 the letter and a copy of the check you are talking 22 about? 23 A Yes, it is. 24 Q And this is dated January 8, 2013, right? 25 A Yes, it is. Page 82 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 9 of 17 1 Q So a little more than a month later they sent 2 this letter and a check? 3 A Yes. 4 Q In-between December 2, 2010 and January 8, 2013 5 did you have any interactions with Atlas? 6 A No. 7 Q Do you know if Mr. Murphy did? 8 A I do not know. 9 Q Do you know if your husband did? 10 A No, he did not. 11 Q In terms of chronology then, correct me if I am 12 wrong, you get the shingles, Mr. Murphy gives you this 13 package, you put it all in the mail to Atlas and then a 14 little more than a month later this letter and check 15 comes? 16 A Yes. 17 Q And did you cash the check? 18 A Eventually. 19 Q Okay. Did you have any interactions with Atlas 20 immediately after receiving this letter? 21 A Sometime later, yes, I called them. 22 Q And by sometime is that weeks, months? 23 A I'm guessing a month or more. 24 Q On Exhibit 8, Mr. Murphy's letter, December 2, 25 2010 there is a -- Page 83 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 10 of 17 1 Q Okay. Anything else? 2 A I think that's it. 3 Q When did you first notice the, what you call 4 the appearance issue? 5 A I believe it probably was brought to our 6 attention when we started having the leak issues and 7 Dennis showed us and then I saw up close the samples of 8 the shingles that he removed. 9 Q And do you remember when that was? 10 A Most likely 2012, the end when we sent the 11 package to Atlas. 12 Q The -- when was the first time you associated 13 the leaks with a potential defect in the shingles? 14 A When Dennis brought it to our attention. 15 Q And when was that? 16 A 2012. 17 Q Other than from Dennis have you -- has anybody 18 else made that connection for you? 19 A No. 20 Q When you looked at the shingles that Mr. Murphy 21 removed to send to Atlas what is it that you found 22 different than what you expected in terms of repairs? 23 A They were -- they didn't look right. They 24 looked old, faded, obviously. Full of marks. 25 Q Anything else? Page 88 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 11 of 17 1 lawsuits with shingles? 2 A I don't know. 3 Q After the January 13th correspondence from 4 Atlas did you have any conversations with any 5 representatives of Atlas? 6 A I called Atlas. 7 Q Okay. When was that? 8 A I'm not exactly sure. I'm kind of guessing it 9 was probably a month or two later, because we held onto 10 the check for awhile. And I called to find out exactly 11 what they were going -- or if anything they were going 12 to do about the roof, that the amount of money that they 13 sent surely wasn't going to replace or pay for a new 14 roof and at that time I was told that the check was 15 covered only -- covered the whole roof prorated. 16 Q On some prorated basis? 17 A Right. 18 Q During that month or two between the time you 19 got the check and you talked to somebody at Atlas did 20 you have conversations with Mr. Murphy? 21 A I don't think so. I don't recall. 22 Q So was it -- when in relationship to having 23 that conversation with a representative of Atlas did you 24 pursue the idea of a lawsuit? 25 A I don't know. I'm assuming that there were Page 97 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 12 of 17 1 other leaks and things were going on with the roof. 2 Q So it wasn't in-between the time that you got 3 the check and you cashed the check that you started 4 talking to either Mr. Murphy or your son-in-law about 5 the legal action? 6 A No, later. 7 Q Do you remember who you spoke with at Atlas? 8 A It was a woman, but I do not recall her name. 9 Q Did you have any other conversations with any 10 other representative of Atlas? 11 A No, I did not. 12 Q Did you get any follow-up correspondence from 13 anybody at Atlas? 14 A No, nothing. 15 Q How much longer after that was it that Mr. 16 Murphy suggested that maybe you should get a lawyer 17 involved? 18 A Less than a year. I'm not sure how long 19 exactly. A few months maybe. 20 Q In your conversations with Mr. Murphy about the 21 leaks in the roof did you ever have discussions about 22 whether his crew installed portions of the roof 23 correctly? 24 A I did not have a discussion about that. 25 Q Do you know if your husband did? Page 98 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 13 of 17 1 shingles are failing that they should cover the cost to 2 replace the shingles. 3 Q Okay. And the -- 4 A And the damages that occurred because of that. 5 Q The expressed warranty that you are talking 6 about that you read that's what you received enclosed 7 with the January 2013 letter from Atlas? 8 A Yes. 9 Q Anything else? 10 A No. 11 Q Did you find in reading the warranty that you 12 received in January 2013 anything about it to be 13 unconscionable? 14 A I don't recall, it has been a while. 15 Q There is a claim on Page 23 for fraudulent 16 concealment. Do you allege that Atlas concealed any 17 material information? 18 A I believe they have. 19 Q And what specifically do you allege that they 20 concealed? 21 A That I believe that they have -- I know that 22 they continued to make the shingles after the problems 23 of all the shingles was addressed to them. 24 Q And how do you know that? 25 A I was told that. Page 102 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 14 of 17 1 THE WITNESS: I don't know. 2 Q Do you have an understanding of the difference 3 between the overlay portion of the shingle and the base 4 layer of the shingle? 5 A No, I do not know. 6 Q Have you had any neighbors make insurance 7 claims with regard to hail storms or tropical storms or 8 hurricanes? 9 A I'm not aware. 10 Q Do you ever have hail down here? 11 A Occasionally. 12 Q On your home what do you believe the damages 13 are? 14 A I don't know what you mean. 15 Q What -- what do you think it is going to 16 cost -- 17 A A dollar amount? 18 Q Yeah. 19 A I don't know. 20 Q Do you know what needs to be addressed that 21 would cost money that would comprise the relief you are 22 seeking in this case? 23 A What needs to be done? 24 Q Yes. 25 A Yes. Page 106 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 15 of 17 1 Q What do you believe needs to be done? 2 A The shingles need to be removed and new 3 shingles put on and damage needs to be taken care of in 4 the house as far as the plaster replaced and I don't 5 know whether there's any mold or mildew or any other 6 rotten wood because of that. 7 Q And the plaster that needs to be replaced is in 8 which rooms? 9 A Most likely all areas, because all of the 10 plaster, as far as I can say -- see is the plaster is 11 failing. It's falling. I mean, it's deteriorating. 12 Q When you say -- are you talking about the 13 plaster throughout the entire house? 14 A No, I'm talking about where the leaks are. 15 Q Where the five leaks -- 16 A Correct. Correct. 17 Q And then related repainting or whatever in 18 those areas? 19 A Yes, of course. 20 Q Anything else that you think needs to be done? 21 A No. 22 Q Do you know how much money you have spent -- I 23 think, did you say $7,700 to put the roof on? 24 A Yes, I believe that was the amount. 25 Q In addressing the leaks do you know how much Page 107 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 16 of 17 1 money you've spent? 2 A How much additional we've spent, no, I don't 3 know. 4 Q Ballpark figure? 5 A No, I couldn't even guess. 6 Q Do you know if Mr. Murphy did any of his work 7 gratis? 8 A I believe he has. 9 Q Do you know why? 10 A Just a summation that he felt sorry for us. 11 Q What have you done, if anything, to prepare 12 yourself to be a class representative plaintiff in this 13 case? 14 A I have read all of the documentation that has 15 been sent to us and have spoken with our attorneys on 16 two different occasions on the telephone plus meeting in 17 person. 18 Q You've indicated that you have read 19 documentation sent to you? 20 A E-mail, yes. 21 Q So what -- generally what is that? 22 A Documentation that you have presented. 23 Q Okay. 24 A The suits. 25 Q And the suits, you have looked at the Page 108 Veritext Legal Solutions Toll Free: 855.282.1018 404.817.9606 Case 1:13-md-02495-TWT Document 391-3 Filed 07/12/17 Page 17 of 17 EXHIBIT “B” Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 1 of 7 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION IN RE: ATLAS ROOFING CORPORATION CHALET SHINGLE PRODUCTS LIABILITY LITIGATION ) ) ) ) ) MDL DOCKET NO. 2495 1:13-MD-2495-TWT ----------------------------------------------------------- PENNY SEABERG, on behalf of herself and all others similarly situated, Plaintiff, v. ATLAS ROOFING CORPORATION, Defendant. ) ) ) ) ) ) ) ) ) ) CIVIL ACTION FILE NO. 1:14-cv-03179-TWT PLAINTIFF’S ANSWERS TO DEFENDANT’S FIRST SET OF INTERROGATORIES COMES NOW the Plaintiff, Penny Seaberg (hereinafter “Plaintiff” or “Ms. Seaberg”), by and through her attorneys and pursuant to Fed. R. Civ. P. 33, states as follows for her objections and answers to the First Set of Interrogatories propounded by Defendant, Atlas Roofing Corporation (hereinafter “Defendant” or “Atlas”). Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 2 of 7 4. Which of the following statements describes Your involvement, if any, in selecting the Shingles for Your Home: ANSWER: [Fourth Statement] Plaintiff was not involved in selecting the Shingles as the brand of shingles to be installed on her Home. 5. Please provide the month and year in which the installation of the Shingles on Your Home was completed. ANSWER: September 2004 6. Please identify the specific location any and all damage to Your Home allegedly caused by a defect in the Shingles on Your Home including but not limited to any damage to portions of Your Home other than the Shingles themselves. ANSWER: Plaintiff’s defective Shingles have caused plaster/drywall cracks and other water damage in her home’s hallway entrance, kitchen (in particular, above the sink), pantry (in particular, above the circuit breaker box), and dining room (where plaster detached and fell down due to water damage). Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 3 of 7 7. For each item of damage to Your Home allegedly caused by a defect in the Shingles on Your Home, please describe the basis of Your contention that such damage was caused by a defect in the Shingles on Your Home. ANSWER: Plaintiff objects to this interrogatory to the extent that it calls for expert opinion. Plaintiff objects to identifying any potential expert, or any potential opinion, except in conformity with the Case Management Order No. 3 - Scheduling Order in this matter. Plaintiff objects to providing an exact dollar amount because Plaintiff’s total damages are still being computed. Without waiting these objections, Plaintiff states that, in general, her damages include the costs to remove and replace the defective shingles, the original cost of the defective shingles, and all materials, property and/or substrates that have been damaged by any moisture intrusion. Plaintiff also contends that her damages would not have been incurred but for the defective shingles. 8. Please identify the name, street address and website address of the roofing contractor or other person which installed the Shingles on Your Home. ANSWER: Murphy Roofs, 10903 N.E. 8th Ct, North Miami, FL 33161. 9. If You were involved in purchasing the Shingles on Your Home, please identify (by name, street address and website address), the entity or seller from which the Shingles were purchased for Your Home. ANSWER: Plaintiff was not involved in purchasing the Shingles. The Shingles were purchased by the installer, Murphy Roofs. Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 4 of 7 15. If You have ever communicated with anyone employed by Atlas, please identify the person with whom You communicated, and state when the communication(s) took place, and the substance of the communication(s). ANSWER: In response to the December 2, 2012 letter from Murphy Roofs notifying Atlas of the failure of a portion of Plaintiff’s Shingles, Atlas Consumer Services Manager Glynese R. Thomas wrote to Plaintiff’s husband on January 8, 2013 offering a pro-rated material settlement. In or around January 2014, Plaintiff contacted Atlas via telephone to notify Atlas of the continuing/additional leaks she was experiencing and to inquire whether the warranty would cover these failures. (Plaintiff does not recall the name of the representative with whom she spoke.) 16. If prior to the installation of the Shingles, You read or saw any Atlas brochures, advertisements or promotional material regarding the Shingles, please describe where, when, and what You read or saw. ANSWER: Plaintiff does not recall reading or seeing any such materials. 17. Please identify Your occupation(s) and employer(s) for the last fifteen (15) years. ANSWER: Plaintiff was a Preschool Director at North Miami Early Childhood School and retired in June 2012. Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 5 of 7 271 17 th Street, N.W., Suite 2400 Atlanta, GA 30363-1014 Email: jpiper@wcsr.com Email: wragland@wcsr.com Winston-Salem, NC 27101 Email: kclinard@wcsr.com Henry B. Smythe, Jr. James E. Weatherholtz Womble Carlyle Sandridge & Rice, LLP PO Box 999 Charleston, SC 29402 Email: hsmythe@wcsr.com Email: jweatherholtz@wcsr.com This the 12 th day of November, 2014. /s/ Daniel K. Bryson Daniel K. Bryson Whitfield Bryson & Mason LLP 900 W. Morgan Street Raleigh, NC 27603 Telephone: 919-600-5000 Facsimile: 919-600-5053 Email: dan@wbmllp.com Plaintiffs’ Co-Lead Counsel Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 6 of 7 Case 1:13-md-02495-TWT Document 391-4 Filed 07/12/17 Page 7 of 7 EXHIBIT “C” Case 1:13-md-02495-TWT Document 391-5 Filed 07/12/17 Page 1 of 4 Case 1:13-md-02495-TWT Document 391-5 Filed 07/12/17 Page 2 of 4 Case 1:13-md-02495-TWT Document 391-5 Filed 07/12/17 Page 3 of 4 Case 1:13-md-02495-TWT Document 391-5 Filed 07/12/17 Page 4 of 4 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION IN RE ATLAS ROOFING ) CORPORATION CHALET ) MDL DOCKET NO. 2495 SHINGLE PRODUCTS ) LIABILITY LITIGATION ) 1:13-MD-2495-TWT ------------------------------------------------------- LLOYD M. DENSON, JR. and ) Civil Action File PEGGY C. DENSON, on behalf of ) No. 1-12-cv-00831-TWT themselves and all others similarly ) situated, ) JURY TRIAL DEMANDED ) ) Plaintiffs, ) ) v. ) ) ATLAS ROOFING CORPORATION ) ) ) Defendant. ) EXPERT REPORT OF PROFESSOR GEORGE L. PRIEST I. Initial Statement of Qualifications 1. I am the Edward J. Phelps Professor of Law and Economics at Yale Law School, teaching economic subjects including courses in antitrust, civil procedure, contracts, torts, and insurance, among other subjects. I have served as a professor at Yale Law School since 1980. I served as the John M. Olin Professor of Law and Economics at Yale Law School from 1986 through 2008. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 1 of 36 2 2. I received a Bachelor of Arts degree from Yale in 1969 and a law degree from the University of Chicago in 1973. 3. Throughout my career, my research has been in the field of law and economics. I have published numerous articles in the areas of law and economics. Many of my articles have appeared in economics journals; others, in law journals. 4. An early subject of my research was the operation of consumer product warranties. I published an article, “A Theory of the Consumer Product Warranty” in 1981, 90 Yale L. J. 1297. The paper has been regarded as a seminal analysis of the operation of product warranties and has been reprinted and excerpted in many publications. The article was awarded the 1981-82 Prize for Distinguished Scholarship in Law and Economics from the University of Miami. Over my career, I have published many other articles on consumer product warranties, such as “The Structure and Administration of the Magnuson-Moss Warranty Act”, in Economic Regulation and Consumer Welfare: The Federal Trade Commission in the 1970’s (Clarkson and Muris eds., Cambridge U. Press, 1981); “Reflexiones Respecto de la Contratacion Masiva”, in Por Que Hay Que Cambiar el Codigo Civil? at p. 155 (Fernando Cantuarias Salaverry, ed. 2001); “Modernizing the Regulation of Product Warranties”, Federal Trade Commission, 1985. I served as a consultant to the Federal Trade Commission on consumer product warranty issues in 1984-85. 5. Over the course of my career, I have published articles in the following peer-reviewed economics journals: Journal of Law & Economics, Journal of Legal Studies, Research in Law and Economics, Journal of Law, Economics & Organization, Journal of Economic Perspectives, Journal of Risk & Uncertainty, Geneva Papers on Risk Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 2 of 36 3 and Insurance, the Italian journal Mercado, concorrenza, regale (Market, competition, regulation), Journal of Reprints for Antitrust Law and Economics and, most recently, the Journal of Labor Economics, the Supreme Court Economic Review and, again, the Journal of Law & Economics. 6. I have served as a peer-review referee for the following economics journals: American Economic Review, Economic Inquiry, Journal of Political Economy, Review of Economics and Statistics, Rand Journal of Economics, Journal of Law & Economics, Journal of Legal Studies, and Journal of Law, Economics & Organization. I have also served as a peer-review referee for the National Science Foundation, Law and Social Science, Economics Division, for Law & Society Review, and for the journal Science. 7. I have held appointments as a Visiting Professor in the Department of Economics, University of Miami and the Department of Economics, University of Toronto. 8. In 1991, I was elected the first President of the American Law and Economics Association by the Association's members. 9. I have testified many times before Congress, before many state legislatures, and before state and national regulatory commissions. 10. I have been invited numerous times to present lectures on economics- related issues to state legislators, regulators, and state and federal appellate judges. For many years, I have conducted a regular course on economics subjects, including issues related to warranties and products liability, for federal appellate judges and federal bankruptcy judges in a federal judicial instruction program managed by George Mason Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 3 of 36 4 University. I have also conducted courses on economic subjects in an instructional program for state court judges managed by the University of Kansas School of Law. 11. From 1987 to 1989, I served on the American Bar Association President's Commission to Improve the Liability Insurance System. In 2002, I delivered the 26th Annual Geneva Lecture on Insurance sponsored by the Geneva Association for Risk and Insurance Economics. I have been elected to the American Academy of Arts and Sciences. 12. My experience extends beyond the academic. I am well acquainted with class action litigation. For the past twenty-seven years, I have served as a Special Master in the United States District Court for the District of New Jersey in the litigation, McLendon v. The Continental Group, Inc., upon reference by the Honorable H. Lee Sarokin and, subsequently, under the Honorable Dickinson R. Debevoise. The McLendon case was a nationwide class action comprising over 7,000 settlement participants which was settled in 1990 for the sum of $415 million. 13. I have presented testimony on economics subjects either at trial, in deposition or by expert report in the following federal courts: the Northern, Middle and Southern Districts of Alabama, Central and Northern Districts of California, District of Connecticut, Middle and Southern Districts of Florida, Northern District of Illinois, District of Maryland, District of Nevada, District of New Jersey, Eastern District of New York, Northern District of Ohio, Northern District of Oklahoma, Eastern and Western Districts of Pennsylvania, Middle District of Tennessee, Eastern District of Texas, and the Court of Federal Claims; in federal Bankruptcy Courts for the District of Delaware, Eastern District of Louisiana, the Southern District of New York and the Western District Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 4 of 36 5 of Pennsylvania; in state courts in the following states: Alabama, Alaska, Arizona, California, Colorado, Connecticut, Florida, Iowa, Kansas, Massachusetts, Michigan, Minnesota, Montana, New Jersey, New Mexico, New York, Ohio, Tennessee, Texas, and West Virginia; and also in Ontario, Canada; Barcelona, Spain; and Lima, Peru. 14. I view my expertise on the issues raised in this litigation to be based upon the following: a) my study and research for over 40 years of the economic determinants of contract terms; b) my study over the same period of the operation of consumer product warranties and my understanding of the economic bases upon which warranties involving specific promises can be offered to consumers for the risks they face of underperformance or product failure; and c) my years of teaching the economic principles of contract formation and the regulation of contractual promises. 15. My publications are listed in my current resume which is attached as Appendix I. A list of previous testimony and my rate of compensation appear as Appendix II. The materials I have reviewed in connection with this matter appear as Appendix III. II. Question Presented and Initial Statement of Opinions 16. I have been asked to address, from the standpoint of economic analysis, the function and operation of product warranties, including the Atlas shingle warranties that form the backdrop of the claims in this case, and the economic effects of those warranties over the years at issue as they might relate to the claims of the putative class representatives in this litigation. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 5 of 36 6 17. Based upon my economic and empirical analysis of the function and operation of product warranties and my study of the warranties Atlas and its competitors issued over the putative class period, it is my opinion that: 1) For good economic reasons, a product warranty, such as the Atlas shingle warranty, serves not as a representation that a product will survive without defect for a particular period of time, but essentially as a repair or replacement contract providing that, if the product is found to have a manufacturing defect over that period, the manufacturer will provide a defined form of recompense to the consumer for some portion of the losses that the consumer has suffered; 2) There are sound economic reasons that determine the definition of coverage of the Atlas shingle warranties provided over the putative class period. 3) The Atlas shingle warranties resemble closely the warranties of other shingle manufacturers that compete with Atlas, in terms of structure, period of remedies, nature of potential losses warranted, limitations of coverage with respect to the original purchaser, requirement of proof of purchase, and limitations and exclusions of coverage. My analysis of these issues derives from my study over the years of the operation of consumer product warranties of many products. I have also carefully reviewed the putative class representatives’ claims concerning the Atlas shingles that they purchased. 18. I view my role as solely attempting to explain the economic structure of product warranties, and how competition among product sellers over warranty coverage leads to the various provisions of coverage seen in the Atlas shingle warranties as it does with respect to the warranties of the many other products I have studied. III. The Economic Function and Effect of Product Warranties 19. Product warranties serve for a consumer as essentially a repair or replacement contract sold along with the product by providing that if, within a certain Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 6 of 36 7 period, the product or some part of the product is not as warranted when sold, the manufacturer will provide a pre-defined form of compensation to the consumer for the loss. As a repair or replacement contract, a product warranty provides that the manufacturer will replace that portion of the product according to the terms of the contract. 1 20. My studies have shown that there is substantial competition among manufacturers over the coverage provided by their product warranties. Indeed, Congress enacted legislation in 1975 in order to further stimulate manufacturer competition over product warranties. 2 21. In our mass production society, products must be designed to be suitable for large numbers of consumers. With respect to all products, consumers will differ in the ways they subject a product to use. 3 As mentioned, manufacturers design a product so that it best fits the expected uses of some dominant group within the total set of consumers. Necessarily, however, this means that there will be other groups of consumers whose uses are more or less intensive with respect to some features of product use than that of the dominant set. 22. A warranty is not a representation of the expected duration of a product or of all of the parts of a product. Many products will have a duration that extends many 1 For a more detailed discussion of this point, see Priest, A Theory of the Consumer Product Warranty, 90 Yale L.J. 1297 at 1308-1313 (1981) (hereafter Priest, Product Warranty). 2 Magnuson-Moss Warranty—Federal Trade Commission Improvement Act, Pub. L. No. 93-637, §§ 101- 112, 88 Stat. 2183 (1975) (codified at 15 U.S.C. §§ 2301-2312 (1976)). I have studied the operation of this Act both as an academic and as a consultant to the Federal Trade Commission which largely administers the Act. See ¶ 4, supra. 3 See Priest, Product Warranty at 1307-1319 for further discussion of this point. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 7 of 36 8 years beyond the term of the product warranty, 4 while other individual products have durations less than the average and less than the warranted period of coverage. Where products fail to perform satisfactorily over the warranted period for a manufacturing- related reason, 5 the warranty constitutes a promise that the manufacturer will provide a defined remedy—most typically, repair or replacement—to the consumer. 23. From the standpoint of the manufacturer, in this respect, providing a warranty for a product is a concession—demanded by a competitive market—that product manufacture might not be perfect. As in any human operation, mistakes may be made or inaccuracies may occur during the manufacturing process. 6 To the same end, the product may not be designed in a way that can withstand the use or the intensity of use to which each particular consumer may subject the product since a fail-proof design would increase production costs to such an extent that the product becomes inaccessible to many consumers. From the standpoint of the consumer, in these contexts, the warranty provides protection for a manufacturer-related product failure during the warranty period. Although I have not conducted surveys myself of consumer expectations, I have carefully read the literature on the subject, and the product warranty markets I have studied reflect this point. These warranties provide some form of coverage for some period of time, periods that can differ substantially among products. 4 For an empirical comparison of warranty terms and product service life expectancies, see, Priest, Product Warranty at 1326-1327. See also ¶ 24, infra. 5 Manufacturers will typically exclude warranty coverage—or limit the coverage in some way—of product uses or product parts whose performance can be controlled or is affected by the consumer. Priest, id., at 1311-1314, 1333-1335. 6 Where a manufacturing mistake results in personal injury, products liability standards may apply. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 8 of 36 9 24. Some products are attended by warranties that provide coverage for very limited periods of time: one year, two years, five years of coverage is common for many consumer products. In my study of warranties provided by the Federal Trade Commission, refrigerators, dryers, gas ranges, electric ranges, color televisions and many washers provided warranty coverage for only one year; freezers, five years. Yet the total life expectancy of these products were respectively 15 years (refrigerators), 15 years (dryers), 13.5 years (gas ranges), 7 14 years (electric ranges), 12 years (color televisions), 8 12 years (washers), and 18 years (freezers). 9 Again, there is no relationship between the period of warranty coverage and the expected life of the product. It is implausible from an economic standpoint to believe that consumers who purchase their refrigerator, dryer, range or television, each with a one-year warranty, expect to replace each of these appliances on an annual basis. 25. Other products, including shingles, are attended by warranties that provide coverage in some form for extended periods, including the warranties provided by Atlas for the Atlas shingles at issue in this case that provides repair or replacement coverage for 25 years or 30 years. But the competitive market for consumer products shows that purchasers understand that warranty coverage adds to the price of the product and that there is a limit on the extent of coverage for which purchasers will pay. All consumer product warranties that I have studied contain exclusions and limitations of coverage 7 For the first owner. 8 For the first owner. 9 Priest, Product Warranty at 1327. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 9 of 36 10 which demonstrate from a market perspective that there are limits to the extent to which consumers will pay for the provision of repair or replacement. 26. Typical features of product warranties include a warranty against manufacturing defects; a basic period of coverage specified for the repair or replacement remedy should there be a manufacturing defect; what period of time, if any, labor costs of repair are included in the coverage (most manufacturers, from manufacturers of refrigerators to gas ranges (though not of shingles) exclude coverage of labor costs entirely); 10 limitations of coverage to the original purchaser of the product (again, common for many products including dryers and televisions); 11 and provide other more specific forms of coverage or exclusions and limitations of coverage depending on the product, for example, for shingles, specific coverage definitions with respect to wind and algae resistance. 27. The manufacturers of many, though not all, products will allow consumers to purchase extended warranty coverage—coverage that extends the manufacturer’s promise in some dimension. In most cases, extended coverage lengthens the warranty coverage in terms of time—i.e., promising five-year coverage over the standard one-year warranty coverage. For other products, however, consumers are able to buy extended coverage of labor repair costs (where labor repair is excluded from or limited in basic coverage) or extended coverage of particular product parts, such as extended compressor coverage for air conditioners or extended power train coverage for 10 Priest, Product Warranty at 1323, 1338-1342. 11 Priest, id. at 1338. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 10 of 36 11 cars. In these contexts, consumers can choose how much repair and replacement coverage they wish to purchase. 28. In other contexts, as with shingles, manufacturers offer different brands of the product attended by differently timed warranties, including differences in the coverage of replacement labor costs, to allow consumers to choose the repair and replacement services that they wish to purchase. With respect to this case, Atlas offered consumers Chalet or Stratford brand shingles, attended by a 25-year and then 30-year limited warranty against manufacturing defects, 3 years of Premium Protection (labor costs provided), with wind speed protection to 60 and 80 miles per hour. But Atlas also offered other shingle brands, including the StormMaster LM shingles with a 50-year general warranty, 5 years of Premium Protection (labor), with wind speed protection to 102 miles per hour. 29. This example shows (though there are many other demonstrations of the point) that a consumer may obtain optional enhanced warranty coverage if he or she is willing to pay an additional price for it. Extended warranty coverage will be more valuable to consumers who expect to subject the product to intensive use (e.g., higher wind loads) or who are risk averse with respect to a particular issue. Such optional extended warranty coverage may extend a warranty claims period without guarantying the duration of a product, again demonstrating the absence of a link between the period of warranty coverage and any expected duration of the product. Instead, such an extended warranty simply extends the repair or replacement remedy provided to a consumer under the terms of the warranty. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 11 of 36 12 30. The opportunity to purchase extended coverage at an additional price demonstrates what is an obvious economic point: as mentioned, warranty coverage is costly to a manufacturer, a cost that must be built into the price of the product. For most product lines, some manufacturers will provide extensive warranty coverage at higher product prices; other manufacturers will provide less extensive coverage at lower product prices. A customer will be able to select among products those with product features and repair and replacement protection that best fit the consumer’s needs. IV. Warranties for Shingles Considered 31. Roofing shingles provide a good example of how products are subjected to a wide range of “uses” across consumers and of how consumers are likely to differ substantially in intensity of product “use.” 32. Shingle use varies, for example, in the extent to which homes are subjected to various external conditions that may affect shingle duration. For example, differing environmental stresses (e.g., climate, exposure and weather events) or different mechanical stresses (caused by improper application or maintenance) are examples of such potential variations in the intensity of product use. Although other experts will testify more fully on these points, for purposes of understanding shingle warranty coverage, shingle consumers will differ in terms of home construction, including roof slope and roof ventilation both of which, among other examples, may affect shingle duration. Consumers will also differ in terms of the method of application of their shingles: the placement of fasteners (roofing nails), the installation of flashings and other metal work, and the conditions of the below-shingle waterproof membrane. As mentioned, each of these differences may affect the ability of any manufacturer’s shingle Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 12 of 36 13 to continue to perform its function. Since variations in the product or services of others affect the duration of a roof, shingle manufacturers have warranted against manufacturing defects as opposed to warranting the product will last for a particular duration. 33. The market shows that the conditions to which shingles are subjected—as is true of all other products—are likely to differ very dramatically across consumers. The shingle warranties that I have studied illustrate these points, especially in the definition of optional wind and algae coverage that is available. Compare the different concerns about discoloration from algae versus wind resistance of a consumer from the Deep South whose home lies under hanging moss and a consumer on the wind-swept plains of Oklahoma or Wyoming. 34. Manufacturers generally warrant the product or services they sell as opposed to the products or services supplied and separately warranted by independent businesses. A building project must be installed by independent contractors, and integrated with products manufactured by third-party manufacturers, according to designs prepared by third-party design professionals, and within a sequencing coordinated by a third-party builder or general contractor. Where these integrated products and services are supplied and warranted by independently owned and operated businesses, a building product manufacturer warrants only the particular product it sells as opposed to the products or services sold and separately warranted by others (e.g., builders, subcontractors or design professionals). A manufacturer would not warrant the duration of a building product where its duration may depend on the quality of such installation, integration or design by third parties. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 13 of 36 14 V. The Atlas Shingle Warranties and Their Comparison to the Warranties of Competing Shingle Manufacturers 35 . As I understand the putative class claims in this litigation, there are basically two Atlas shingle warranties at issue: 12 an Atlas warranty issued covering shingles installed after January 1, 1998 13 and an Atlas warranty covering shingles installed after January 1, 2002. 14 The January 1, 1998 warranty provided coverage of “manufacturing defects that would reduce the usable life of the product.” It provided coverage for Chalet shingles for 25 years, including labor coverage (excluding metal work and flashing, obviously not related to the shingles) called Premium Protection for 3 years. Product replacement for succeeding years was to be pro-rated. 15 The warranty provided Limited Wind coverage for 5 years for damage from winds up to 60 miles per hour. It provided algae coverage for shingles labeled ARS (Algae Resistant Shingles) for 10 years. The warranty disclaimed the warranties implied under the Uniform Commercial Code; disclaimed liability under other legal theories; and included exclusions of coverage for faulty application, inadequate sheathing or ventilation; loss of granules; damage because of disturbance of the home; damage because of causes other than manufacturing defects and 12 The question is not totally clear because the proposed class definitions in many of the various complaints against Atlas are vague on this point. 13 ATLS00072039. 14 ATLS00073788. 15 Where remedies are available over lengthy periods, it is common for warranties to pro-rate protection over the warranty period. Pro-ration of this nature serves to provide compensation for a warranted problem, while acknowledging the value received by the consumer from the product prior to the time the consumer provides notice of the claim. As indicated below, all shingle manufacturers pro-rate parts coverage after an initial period of full labor and parts coverage. Pro-ration of this nature is common in the warranties of other products that have long service lives, for example, tires. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 14 of 36 15 because of Acts of God. The 1998 warranty provided for transferability of the coverage to a second owner and defined the claim reporting period. The 2002 warranty provided coverage of “manufacturing defects which result in leaks.” That warranty expanded the warranty claims period for both Chalet and Stratford shingles from 25 to 30 years. With respect to Wind damage coverage, it distinguished Chalet and Stratford High Wind Application shingles, expanding coverage to damage from winds up to 80 miles per hour (versus 60 miles per hour in the 1998 warranty), though retaining the 60 miles per hour limit for Chalet and Stratford Standard Application shingles. 36. How does the coverage provided in Atlas’s shingle warranty compare to the coverage provided in the shingle warranties of some of Atlas’s competitors: GAF, CertainTeed, TAMKO, IKO, and Owens Corning? Is Atlas’s warranty coverage substantively deficient in comparison to the shingle warranty coverage otherwise available on the market? As we shall see, and as should be expected in a competitive market such as shingles, the Atlas warranty is closely similar both in structure and in the substantive coverage provided to the warranties of its competitors, although some of the competitive warranties allow different choices as to available products, as did Atlas. 37. Below is a comparison 16 of the major terms of coverage among the shingle warranties of the manufacturers GAF, 17 CertainTeed, 18 TAMKO, 19 IKO, 20 Owens Corning, 21 and Atlas. 22 16 The compared warranties were issued at different times between 1996 and 2004. 17 GAF Smart Choice Shingle Limited Warranty, 2/1/99. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 15 of 36 16 a) Definition of Coverage: GAF warrants its shingles to be “free from manufacturing defects that (a) adversely affect their performance [for a limited period] or (b) cause leaks.” CertainTeed warrants that their shingles will be free from “manufacturing defects.” Owens Corning warrants its shingles to be “free of manufacturing defects that materially affect their performance on your roof.” TAMKO, IKO and Atlas (2002) warrant that their shingles will be free from manufacturing defects that cause leaks. b) Duration of Materials Coverage: Each of the competing manufacturers offers a range of shingle brands providing coverage over various periods of time, from as low as 20 years (GAF, CertainTeed, TAMKO, IKO and Owens Corning) to Lifetime guarantees, of course, for a higher price. As mentioned, Atlas’s 1998 warranty provided remedies for manufacturing defects over a 25 year warrant period for Chalet shingles; the 2002 warranty, 30 years for both Chalet and Stratford shingles, but other brands with longer warranty claims periods. d) Duration of Labor Coverage: Most of the manufacturers have established a separately named protection program that defines the coverage of labor costs of installing replacement shingles. For the GAF warranty, it is called “Smart Choice”; for CertainTeed: “SureStart”; for TAMKO: “Full Start”; for IKO: “Iron Clad”; for Owens Corning: “TruPROtection” and for Atlas: “Premium Protection”. These programs differ in terms of the labor coverage offered: The GAF warranty, 3, 5 and 10 years, by brand; CertainTeed, 3, 4, 5 and 10 years by brand; TAMKO, 3, 5 and 7 years by brand; IKO, 3 and 10 years by brand; Owens Corning, 3 and 5 years by brand; Atlas, 3 years for Chalet and Stratford, though longer for other shingle brands. e) Proration of Materials Coverage: 18 CertainTeed Asphalt Shingle Products Limited Warranty, 11/1/2002. 19 TAMKO Roofing Products Warranty,12/1/04. 20 IKO Industries Inc., Asphalt Shingle Limited Warranty, 12/ 1/1996. 21 Owens Corning Limited Warranty on Roofing Shingles, December 2002. 22 Atlas Limited Shingle Warranty, January 2002. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 16 of 36 17 Following the defined period of labor coverage, each of the competing manufacturers provides for materials coverage to be pro-rated over the remaining term of the warranty, as explained, to account for the value received to that point by the consumer since application of the shingles. 23 Uniformly across the manufacturers, the pro-ration is based upon the fractional remaining warranted period. Thus, for each of the manufacturers, warranty protection declines over time according to the previous benefit the consumer has received from the shingles. f) Wind Coverage: Each of the competing manufacturers provides coverage of damage by wind, distinguishing between regular installation and high wind installation (more roofing fasteners). The GAF warranty provides coverage for its different brands from 60 to 80 mph; the CertainTeed warranty, from 60 to 110 mph; the TAMKO warranty, from 60 to 90 mph for regular installation; 90 to 110 mph for high wind installation; the IKO warranty, 60 mph; the Owens Corning warranty, from 60 to 110 mph if installed strictly according to specification; the Atlas warranty from 60 to 80 mph, though up to 102 mph for different brands of Atlas shingles. g) Algae Coverage: Each of the competing manufacturers offers coverage for discoloration due to algae growth for different brands of shingles. Most of the manufacturers have developed separate brands of shingles with greater resistance to algae growth. With respect to basic coverage, the GAF warranty provides coverage for cleaning or replacement during the first year of coverage; with proration after the first year. It provides longer periods of coverage for shingles labeled “Algae Eater”; the CertainTeed warranty, 10 or 15 years for its “Algae Resistant” brands; the TAMKO warranty, 10 years of cleaning coverage for shingles labeled “Algae Relief”; the IKO warranty, disclaims coverage of discoloration by algae; the Owens Corning warranty, 12 months coverage generally, including labor of shingles labeled Algae Resistant; the Atlas warranty, 10 years for shingles designated Algae Resistant. h) Original Purchaser: 23 See n. 15, supra. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 17 of 36 18 Although it is very common in consumer product warranties to limit coverage to the original purchaser, 24 each of the competing shingle manufacturers permit coverage to be formally transferred to the first subsequent purchaser of the house with some limitations. i) Limitations and Exclusions: The shingle warranties of all of the manufacturers are Limited Warranties which include exclusions of the implied warranties and limit coverage to the definitions in the separate warranty contracts. 38. As is evident from the comparison of the warranty coverage offered by these competing shingle manufacturers, the warranty coverage that they provide is largely similar for many different features of warranty protection. This is to be expected in a competitive shingle market where any competitor might gain an advantage by offering some feature of its product—such as greater warranty coverage—that is differentially attractive to consumers. There is no indication that the Atlas shingle warranty, in terms of the provisions of coverage, provides substantially lower warranty coverage in any respect. VI. Conclusion 39. For all of the economic reasons explained above, it is my opinion that: 1) A product warranty is not a representation of the expected life of a product but, essentially, a repair and replacement contract sold along with the product promising that, if a product is not as warranted over the warranty period (e.g., free from manufacturing defects), the manufacturer will provide a defined remedy to the consumer; 2) A product warranty, from a market standpoint, is a concession that a consumer must recognize that no product can be perfectly manufactured in every case, but that the manufacturer will stand 24 Generally, for reasons relating to adverse selection. For a discussion, see Priest, Product Warranty at 1335-1338. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 18 of 36 Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 19 of 36 1 Resume March, 2015 George L. Priest Yale Law School Home Office P.O. Box 208215 350 Livingston Street New Haven, Connecticut 06520-8215 New Haven, Connecticut 06511 Telephone: (203) 432-1632 Telephone: (203) 624-8331 e-mail: george.priest@yale.edu Personal: Age: 67 Birth: November 24, 1947 Married, four children, seven grandchildren Employment: Edward J. Phelps Professor of Law and Economics, Yale Law School, 2010—. John M. Olin Professor of Law and Economics, 1986-2009. Professor of Law, Yale University, since 1981. Director, Program in Civil Liability, Yale Law School, since 1982. Director, John M. Olin Center for Studies in Law, Economics and Public Policy, Yale Law School, 1983-1988; Co-Director, since 1988. Visiting Professor, Yale University, 1980-81. Professor of Law, University of California, Los Angeles, 1980-81; Visiting Professor, 1979-80. Professor of Law, State University of New York, Buffalo, 1979-80; Associate Professor, 1977-79. Lecturer and Fellow in Law and Economics, University of Chicago Law School, 1975-77. Associate Professor of Law, University of Puget Sound, Tacoma, Washington, 1975- 1977 (on leave); Assistant Professor, 1973-75. Other Visiting Professor Positions: University of Washington School of Law, 1980; University of Miami Economics Department and Graduate School of Business, 1982-85; University of Rome, “La Sapienza,” Rome, Italy, 1983, 1986; Scuola Superiore, University of Pisa, Italy, 1984, 1986, 1988; University of Toronto Department of Economics and Law School, 1988; Escuela de Derecho, Universidad de Puerto Rico, 2007. Education: B.A., Yale University (1969); J.D., University of Chicago (1973). Bibliography: A. Published and Committed Articles 1. Law and Economic Distress: Sangamon County, Illinois 1837-1844, 2 J. Legal Studies 469 (1973). Reprinted in Essays in Nineteenth-Century American Legal History (W. Holt, ed., 1976). 2. The History of the Postal Monopoly in the United States, 18 J. Law & Econ. 33 (1975). Appendix I Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 20 of 36 2 3. The Common Law Process and the Selection of Efficient Rules, 6 J. Legal Studies 65 (1977). 4. Cartels and Patent License Arrangements, 20 J. Law & Econ. 309 (1977). Reprinted in 8 J. Rep. for Antitrust Law & Econ. 357 (1979). 5. Breach and Remedy for the Tender of Nonconforming Goods under the Uniform Commercial Code: An Economic Approach, 91 Harv. L. Rev. 960 (1978). Excerpts reprinted in Economic Readings in Contract Law (Posner & Kronman eds., 1978). 6. Selective Characteristics of Litigation, 9 J. Legal Studies 399 (1980). 7. The Structure and Administration of the Magnuson-Moss Warranty Act, in Economic Regulation and Consumer Welfare: The Federal Trade Commission in the 1970's (Clarkson and Muris eds., Cambridge U. Press, 1981). 8. The New Scientism in Legal Scholarship: A Comment on Clark and Posner, in Symposium: "Legal Scholarship: Its Nature and Purposes," 90 Yale L.J. 1284 (1981). 9. 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"Products Liability Reform and the Insurance Crisis", Committee on the Judiciary, Louisiana Senate, June 9, 1987. 142.* "An Analytical Critique of the United States' No-Fault Automobile Experience", Inquiry into Motor Vehicle Accident Compensation in Ontario (Osborne Inquiry), June 30, 1987. 143.* "Hearings on the Nomination of Robert H. Bork to be Associate Justice of the Supreme Court of the United States", Committee on the Judiciary, United States Senate, 100th Congress, 1st Session 2439- 2444 (1987). 144.* "The Liability Crisis, the Antitrust Suits and the McCarran-Ferguson Act", Subcommittee on Antitrust, Monopolies and Business Rights, Committee on the Judiciary, United States Senate, June 14, 1988. 145.* "Allowing Drivers a Choice between No-Fault and Fault-Based Auto Insurance: An Analytical Critique", Ontario Automobile Insurance Board, May 24, 1989. 146. “Alternative Compensation Systems and the Problems of Modern Tort Law", Minnesota Injury Compensation Study Commission, June 21, 1989. 147.* "The Costs of Regulation Given the Role of the Insurance Industry in Modern Society", Consolidated Hearings before the Insurance Commissioner of the State of California, January 9, 1990. 148.* "The Successes and Failures of Threshold No-Fault Systems in the United States", Standing Committee on General Government, Parliament of Ontario, January 17, 1990. 149.* "The Effects of Proposition 103 on Consumers and on Competition in Property/Casualty Insurance", Comment on Proposed Regulations, Department of Insurance, State of California, April 8, 1991. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 29 of 36 11 150.* "Confiscatory Regulation and the Effects of Proposition 103's Rollback Orders on Consumers and on Competition in Property/Casualty Insurance", Department of Insurance, State of California, November 21, 1991. 151.* "Internalizing the Costs of Nuclear Power", Ontario Court (General Division), April 23, 1993. 152. “The Economic Function of Life Insurance Agency Commissions and the Effects on Consumers of Mandatory Rebates," Department of Insurance, State of California, October 18, 1993. 153.* "How to Privatize Intelsat". 154.* McCarran-Ferguson Reform, State Regulation and the Consumer Interest, National Conference of Insurance Legislators, New York, November 12, 1994. 155.* "Statement Concerning H.R. 10", Common Sense Legal Reforms Act of 1995, Committee on the Judiciary, 104th Congress, February 13, 1995. 156.* "Statement Concerning Punitive Damages Tort Reform," Committee on the Judiciary, United States Senate, April 4, 1995; and "Response to Statement of [Clinton] Administration Policy of April 25, 1995," May 2, 1995. 157. “Punitive Damages Reform in Historical Perspective,” Hearing on S.1554, “Fairness in Punitive Damages Awards Act,” Committee on the Judiciary, United States Senate, July 29, 1998; and Response to Senator Orrin G. Hatch, Chairman, United States Senate Committee on the Judiciary Re: S.1554, “Fairness in Punitive Damages Award Act,” September 3, 1998. 158. “The Antitrust Implications of the Cable Bills,” New Jersey State Assembly, February 3, 2003; New Jersey State Senate, March 10, 2003. 159. Securing Our Economic Future: The White House Conference on the Economy, The High Costs of Lawsuit Abuse, December 15, 2004, http://www.whitehouse.gov/news/releases/2004/12/print/20041215-11.html D. Journalism 160. "The Benefits of Tort Reform--Sense & Nonsense", Wall Street Journal, February 11, 1987 at 26. 161. "USA, Cartelli in Rimonta" in Dossier Antitrust at 23, Il Sole 24 Ore, 29 January 1988, Roma, Italia. 162. Commentary, "The (Pop-Gun) War Against the Insurers", Hartford Courant, June 26, 1988 at C1. 163. "Tort Law, Insurance, and the Insurance Crisis", in Tort Law and the Insurance Crisis, The World & I at 522 (Criner ed., February, 1989). 164. "How to Control Liability Costs", Fortune, April 24, 1989 at 323. 165. "The Antitrust Suit Counteroffensive to Tort Reform", Legal Backgrounder, Washington Legal Foundation, May 12, 1989. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 30 of 36 12 166. "Negli States la Privatizzazione si Chiama Deregulation", L' Opinione, 21 March 1989 at 57, Roma, Italia. 167. "Will Argentina Simply Replace One Monopoly With Another?", Wall Street Journal, September 22, 1989 at A13. 168. "What Bork and Sarokin Have in Common", (letter) Wall Street Journal, August 22, 1994 at A15. 169. "The Punitive Damages Problem in Alabama", Birmingham News, December 29, 1996 at 1C. 170. "The Supreme Court Passes the Buck on Asbestos", Wall Street Journal, July 2, 1997 at A15. 171. “True Conservatism and Satellite Competition”, Space News, May 11, 1998 at 21; reprinted Congressional Record, May 20, 1998 at E908. 172. “The Stakes in the Case against Microsoft”, Wall Street Journal, May 19, 1998 at A22; “The Dangers of Attack on Microsoft” (response to Robert H. Bork), Wall Street Journal, June 8, 1998 at A23. 173. “The Conservative Delusion over Auto Choice”, Wall Street Journal, July 21, 1998 at A14. Reprinted in “On the Issues,” American Enterprise Institute, August, 1998; Louisiana Advocates at 4 (September, 1998). 174. “Why Clinton Lied”, Wall Street Journal, September 23, 1998 at A22. 175. “Trial by State,” review of Richard A. Posner, An Affair of State in Wall Street Journal, September 14, 1999 at A20. 176. “Judge Jackson’s Case against Microsoft,” Wall Street Journal, November 8, 1999 at A50. 177. Dialogue with Jonathan Zittrain: “The False Epic of the Microsoft Decision,” November 24, 1999; “Judge Jackson’s Case More Carefully Considered,” November 30, 1999; “General Rules, the Remedy in Microsoft, and the Role of Judge Posner,” December 1, 1999, Slate Magazine, www.slate.com/dialogues 178. “Don’t Count on a Breakup,” Wall Street Journal, April 26, 2000 at A26; reprinted in the Toronto Financial Post, April 28, 2000 at C19. 179. “On Character Assassination,” Yale Docket, May 2000 at p. 3. 180. “Some Kind of Remedy,” New York Times, June 9, 2000 at A31. 181. “Letter to Larry,” The Industry Standard, July 3, 2000 at 122. 182. “Community Impact Evaluation Needed,” The Denver Post, August 12, 2000 at 7B. 183. “It’s Not Just Alabama,” Reader’s Digest, October 2000 at 156. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 31 of 36 13 184. “The Deeper Scandal of the Clinton Pardons,” (with Minor Myers III), Christian Science Monitor, February 26, 2001 at 9. 185. “A Ruling for ‘Predators’–and Consumers,” Wall Street Journal, May 3, 2001 at A18. 186. “The GE/Honeywell Precedent,” (with Franco Romani), Wall Street Journal, June 20, 2001 at A18. 187. “Justice Bows to Reason,” Wall Street Journal, September 7, 2001 at A14. 188. “Microsoft Wins . . . Sort Of,” Wall Street Journal, November 2, 2001 at A14. 189. “Microsoft and the Courts,” (response to Larry Lessig) New York Times, November 16, 2001 at A24. 190. “The End of the Microsoft Case,” Wall Street Journal, November 4, 2002 at A14; reprinted in the National Post, November 5, 2002 at FP15. 191. “Class Warfare,” Wall Street Journal, May 5, 2003 at A14; reprinted in the National Post, May 6, 2003 at FP15. 192. “An Expensive Game to Play,” April 12, 2004, Tech Central Station, www.techcentralstation.com/041204E.html 193. “Supreme Wisdom,” Wall Street Journal, June 18, 2004 at A10. 194. “Tackling Tort Reform,” February 11, 2005, National Review Online, http://www.nationalreview.com/comment/priest200502111122.asp 195. “Globalization and the Olympics,” (with Minor Myers III), Wall Street Journal, August 25, 2008 at A11. 196. “The Justice Department’s Antitrust Bomb,” Wall Street Journal, June 2, 2009 at A21. 197. “Stevens and Antitrust,” (with William Ranney Levi), National Law Journal, May 24, 2010 at 46, http://www.law.com/jsp/nlj/PubArticleNLJ.jsp?id=1202458536633&hbxlogin=1 198. “Commentary: The loose threads in American Needle,” National Law Journal, August 4, 2010, http://www.law.com/jsp/nlj/PubArticleNLJ.jsp?id=1202464238938 199. “Washington’s Antitrust Timewarp,” Wall Street Journal, September 6, 2011 at A21. 200. “Will Mexico Harm its Citizens by Departing From Established Antitrust Policy,” Forbes Blogs, October 2, 2011, http://blogs.forbes.com/georgepriest/ 201. “Piketty’s Political Hunch,” The American, July 5, 2014, http://american.com/archive/2014/july/pikettys-analysis-examined 202. “Apple Should Win Its E-Book Appeal,” Wall Street Journal, December 14, 2014 at A13. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 32 of 36 14 Distinguished Lectureships: Olin Distinguished Lecture Series, University of California at Los Angeles School of Business (Inaugural Lecture, 1985). Monsanto Lecture in Tort Law and Jurisprudence, Valparaiso Law School (Inaugural Lecture, 1987). Distinguished Visiting Professor in Legal Theory, University of Toronto Faculty of Law and Department of Economics, Michelmas Term, 1988. Martin P. Miller Centennial Lecture, University of Denver College of Law, 1992. Fifty-Sixth Cleveland-Marshall Fund Lecture, Cleveland-Marshall College of Law, 1993. Twenty-Sixth Geneva Lecture on Insurance, Geneva Association, 2002. Twentieth Higgins Distinguished Visiting Professor, Lewis & Clark Law School, 2003. Distinguished Economist Lecture, Bureau of Competition, Federal Trade Commission, 2004. Other Awards: Templeton Honor Rolls for Education in a Free Society, 1997. Profesor Honorario, Universidad Peruana de Ciencias Aplicadas, Lima, Peru, 2003. Member, American Academy of Arts and Sciences. Teaching: Recent courses: Antitrust; Advanced Antitrust: Network Industries; Insurance and Public Policy; Capitalism; Capitalism Film Society; Regulated Industries; Constitutional Law; Federalism; Campaign Finance Regulation; Products Liability; Torts; Advanced Torts; Civil Procedure; Democracy or Capitalism? (seminar). Other offerings: Contracts; Commercial Law; Price Theory; Remedies; Criminal Case Settlement (seminar); Theories of the Common Law (seminar). Journal Referee: American Economic Review; Economic Inquiry; Journal of Health Politics, Policy and Law; Journal of Japanese Studies; Journal of Law & Economics; Journal of Law, Economics & Organization; Journal of Legal Studies; Law and Society Review; Law and Policy; Journal of Political Economy; Rand Journal of Economics; National Science Foundation (Law and Social Sciences) (Economics); Review of Economics and Statistics; Science. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 33 of 36 15 Consultantships: Institute for Civil Justice, The Rand Corporation, since 1980; Federal Trade Commission, 1984-85; 2001-03. Other Professional Service: President's (U.S.) Commission on Privatization, 1987-88. American Bar Association, President's Commission to Improve the Liability Insurance System, 1987-89. Special Master, McLendon v. The Continental Group, Inc., et. al., U.S. District Court, District of New Jersey, 1989- . President, American Law and Economics Association, 1991-92. American Enterprise Institute, Council of Academic Advisers, 1994- . Council Chairman and member Board of Trustees, 2012- . Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 34 of 36 George L. Priest 350 Livingston Street New Haven, Connecticut 06511 (203) 624-8331 george.priest@yale.edu July 17, 2015 A. Cases in which I have provided Expert Testimony by Trial or Deposition over the past four years: In re: Leslie Controls, Inc., Debtor, U.S. Bankruptcy Court, D. Del., Case No. 10-12199 (CSS) (deposition); Continental Insurance Co., et al. v. Honeywell International, Inc., et al., Morris County, NJ, Case No. MRS-L-1523-2000 (deposition); In re: IKO Roofing Shingle Products Liability Litigation, C.D. Ill., Case No. 09-MD-2104 (deposition and testimony); Sporting Products, LLC, et al. v. Pacific Insurance Co., S.D. FL, Case No. 10-80656-CV-KAM (deposition); Falls v. Allstate Ins. Co., Marshall County, WVA, Civil Action No. 00-C-200M (deposition); R.T. Vanderbilt Company v. Hartford Accident & Indemnity Company, et al., Sup. Ct., Waterbury, CT, Docket No. X02-CV-07-5007875 (deposition); Mitchell v. Residential Funding Corp., et al., Jackson County, MO, Case No. 03CV22089-01 (deposition); Plant Insulation Co. v. Fireman’s Fund Ins. Co., et al., Sup. Ct., San Francisco, CA, Index No. CGC-06-448618 (deposition); The Regence Group, et al. v. TIG Specialty Insurance Company, D. OR, CV 07-1337-HA (deposition); Viking Pump, Inc. and Warren Pumps, LLC v. Century Indemnity Co., et al., Castle County, Del., C.A. No. N10C-06-141 FSS (CCLD) (deposition and testimony). Gonzalez, et al. vs. Owens Corning Sales, LLC, et al., D.C. Penn. (W.D.), Case No. 13-ev-1378 (JFC) (deposition). Exxon Mobil Corporation, et al., v. Certain Underwriters at Lloyd’s London, et al., Sup. Ct., NY, No. 650603/2012E (deposition). B. My standard rate of compensation is $850.00 per hour plus out of pocket expenses. Appendix II Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 35 of 36 Appendix III 12-Dec-04 Tamko Warranty 1-Feb-99 GAF Warranty 1-Nov-02 Certainteed Warranty 1-Dec-96 IKO Warranty 2000 Owens Corning Warranty ATLS00072039-72040 Atlas Warranty ATLS00073788-73790 Atlas Warranty 22-4-15 Affidavit of Clifford Lipscomb 20-4-15 Affidavit of Anthony Mattina 22-4-15 Dean A. Rutila, P.E.'s SGH Investigation Report AL - Denson Amended Complaint AL - Denson Complaint FL - Seaberg Complaint GA - Dishman-Costanzo Amended Complaint GA - Dishman-Costanzo Complaint GA - Purvine Encompass Complaint KY - Makowski Complaint MS - Brooks Amended Complaint MS - Brooks Complaint NC - Wolfpen II Amended Complaint NC - Wolfpen II Complaint OH - Seltzer Amended Complaint OH - Seltzer Complaint SC - Dickson Complaint TN - Mazza-Krehlik-Johnson Amended Complaint TN - Mazz-Krehlik-Johnson Complaint VA - Stratford Amended Complaint VA - Stratford Complaint 7-Jan-15 Denson, Lloyd Deposition 7-Jan-15 Denson, Peggy Deposition 23-Jan-15 FL - Seaberg, Penny Deposition 23-Jan-15 FL – Seaberg, Fred Deposition 13-Jan-15 GA – Costanzo, Anthony Deposition 20-Feb-15 GA – Dishman, Rodney Deposition 20-Feb-15 GA – Dishman, Shirley Diane Deposition 29-Jan-15 KY – Makowski, Bryan Deposition 27-Feb-15 MS – Brooks, Noble Deposition 28-Jan-15 OH – Grieves, Catherine Deposition 2-Mar-15 OH – Seltzer, Brian Deposition 17-Oct-14 SC – Dickson, David Deposition 17-Oct-14 SC – Dickson, Patricia Deposition 26-Mar-15 TN – Johnson, Robert Deposition 27-Mar-15 TN – Krehlik, Brian Deposition 11-Mar-15 TN – Krehlik, Linda Deposition 18-Mar-15 TN – Mazza, Michael Deposition Document Date TitleDocument I.D. No. Case 1:13-md-02495-TWT Document 391-6 Filed 07/12/17 Page 36 of 36 EXHIBIT “E” Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 1 of 7 SEABERG 000064 Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 2 of 7 SEABERG 000065 Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 3 of 7 Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 4 of 7 SEABERG 000067 Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 5 of 7 SEABERG 000068 Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 6 of 7 SEABERG 000069 Case 1:13-md-02495-TWT Document 391-7 Filed 07/12/17 Page 7 of 7 EXHIBIT “F” Case 1:13-md-02495-TWT Document 391-8 Filed 07/12/17 Page 1 of 2 Case 1:13-md-02495-TWT Document 391-8 Filed 07/12/17 Page 2 of 2 EXHIBIT “G” Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 1 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 1 1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA 2 3 IN RE: ATLAS ROOFING 4 CORPORATION CHALET SHINGLE MDL Docket No. 2495 PRODUCTS LIABILITY ALL CASES 5 LITIGATION, 6 7 8 9 10 VIDEOTAPED DEPOSITION OF DEAN RUTILA, Ph.D. 11 October 7, 2015 12 9:16 A.M. 13 271 17th Street, NW Suite 2400 14 Atlanta, Georgia 15 Lee Ann Barnes, CCR-1852, RPR, CRR 16 17 18 19 20 21 22 23 Veritext Legal Solutions Atlanta Region 24 1075 Peachtree Street, Suite 3625 Atlanta GA 30309 25 Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 2 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 85 1 granule loss, have the same condition of 2 effective failure, have the same condition of 3 lack of durability as the 351, based on the 4 uniformity of the information that I presented 5 in my report. 6 Q. (By Mr. Pieper) Have -- have you found a 7 Chalet or Stratford shingle where you determined that 8 a blister on that shingle had resulted in a leak? 9 A. No, I've not looked at blisters and found 10 a -- a hole through the shingle at a blister. I've 11 not done that. 12 Q. Have you found a Atlas Chalet or Stratford 13 shingle where a crack has caused a leak? 14 A. No. Same answer. I've looked at cracks. 15 I've looked at the fact that the waterproofing 16 material that we rely upon on top of the felt is 17 missing, but I've not determined that any particular 18 crack leaks. 19 It's more likely than not that with the 20 absence in both blisters and cracks, that the absence 21 of any waterproofing on top of the felt, that under 22 the right conditions of weather they will leak, but 23 I've not identified a specific shingle. 24 Q. Have you identified a shingle -- strike 25 that. Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 3 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 86 1 Have you identified a Chalet or Stratford 2 shingle that has leaked as a result of a loss of 3 granule surfacing? 4 A. No. Really, the same analysis and the same 5 answer as the previous one; that is, that I have seen 6 surfacing loss where there is no waterproofing 7 asphalt -- asphaltic material on top of the felt, but 8 I have not confirmed that any particular one of them 9 leaks. 10 Q. So if we extrapolate to the general 11 population of all Chalet and Stratford roofs, it's 12 then fair to conclude that none of them have yet 13 leaked as a result of a blister, crack, or granule 14 loss? 15 A. I cannot reach that conclusion because the 16 condition of the 351 roofs is such that any roof with 17 a similar condition could, in the past or -- that 18 would be past if it leaks -- could have before today 19 had the weather event that causes either the 20 catastrophic failure or the saturation through. 21 So it is not a fair conclusion that there 22 have been no leaks, because the condition of the 351 23 roofs we looked at are such that you would make 24 the -- the opposite prediction, that roofs have 25 leaked because of these conditions. Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 4 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 115 1 recall any such other document besides Cash that 2 actually presents a number or a series of numbers. 3 Q. Do you know the average length of time that 4 Chalet and Stratford shingles shed water on the roof, 5 absent some sort of mechanical damage or -- or 6 flashing problem; in other words, the average length 7 of time a Chalet or Stratford shingle will continue 8 to shed water absent something unrelated to the 9 natural deterioration of the shingle intervening? 10 MR. BRYSON: Objection. 11 THE WITNESS: No, because that's an 12 experiment that should not be performed. That's 13 why people replace their roofs when they look 14 like these. It's an experiment that shouldn't 15 be performed. I haven't performed it and it 16 shouldn't be performed. 17 Q. (By Mr. Pieper) Do you assume that anyone 18 who has replaced a Chalet roof has replaced it 19 because they are dissatisfied with its appearance? 20 A. No, I don't make that assumption. I make 21 the assumption that based on some analysis they, and 22 perhaps others, provided, they made that decision. 23 Q. Well, properly manufactured and designed 24 shingles can and do sometimes leak; correct? 25 A. Design and manufactured, yes, if on -- if Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 5 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 116 1 improperly installed, installed on an improperly 2 designed building under weather conditions that 3 exceed reasonable expectations, yes, they can and do 4 leak. 5 Q. A shingle must be integrated properly with 6 other components to resist water, as a general 7 matter; correct? 8 A. As a general matter on a roof, a shingle 9 has to be integrated with other materials to work -- 10 for the building to work properly. 11 Q. So regardless of the brand, water can leak 12 through any shingle on any roof for reasons unrelated 13 to the quality of the shingle? 14 A. Yes, because of the items I gave you two 15 answers prior. The design, installation, and weather 16 conditions in the ans- -- in the question have no 17 limitation, and without limitation, any one of those 18 things can exist to create leakage in a shingle roof. 19 Doesn't leak through the shingles, but it leaks 20 through the roof. 21 Q. The right snow conditions can make pretty 22 much any roof leak; correct? 23 MR. BRYSON: Objection. 24 THE WITNESS: Yes, the -- the right or the 25 wrong, absolutely. I -- I can come up with snow Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 6 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 117 1 conditions -- just about any roof. 2 I also could design a roof, though, that 3 could resist any snow conditions. So it doesn't 4 have to be, but most roofs aren't such -- aren't 5 thusly designed. 6 Q. (By Mr. Pieper) There's a lot of different 7 ways improper nailing can cause a otherwise properly 8 designed and manufactured shingle to -- to leak. 9 A. Yes. Generally, it's not so much -- well, 10 some of the ways don't cause a shingle to leak, but 11 cause a roof to leak. Some of them poke a hole, 12 certainly would cause a shingle to roof -- to leak. 13 Q. For example, an unsealed, exposed nail will 14 cause a shingle to leak? 15 A. Yes, an unsealed -- that is, you can see 16 the head when you look down at the shingle. Yeah, 17 unsealed nail like that is a likely source of leakage 18 at that nail. 19 Q. And unsealed toe board hold -- holes will 20 cause a shingle to leak? 21 A. Not necessarily. A properly done roof 22 scaffold, your -- my understanding of your term of 23 art "toe board hole," is typically nailed so that the 24 nails are up above the -- the nail holes don't pass 25 through the shingle. So if you do it properly, then Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 7 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 118 1 those nails actually don't pass through any shingles 2 and are covered up by two-ply. 3 Now, those nails, if you get -- example, an 4 ice dam can cause water leak through the roof, but 5 are not leaking through the shingles. 6 Q. In that case they wouldn't be unsealed, 7 would they? 8 A. No, they would be -- no, it depends on your 9 definition of "sealed." If you stick -- if you drive 10 the nails through the shingle, then you need to cover 11 them with mastic. But if you stick the nails up 12 above the shingle so that they're actually not 13 penetrating the shingle, which the ones I use -- the 14 ones I own are like that, then you don't seal the 15 nails. You -- you leave them in the tar paper, the 16 felt unsealed. And they could leak, but they're not 17 through a shingle and that's not a shingle leak if 18 they do leak. 19 Q. Unsealed plumbing boot, flashing problem, 20 those could cause a roof to leak? 21 A. Sure, a flashing defect at a vent stack 22 could cause a roof to leak. 23 Q. When SGH did the survey of the 351 roofs, 24 did you attempt to gather the historical information 25 for each building on its leak history? Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 8 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 119 1 A. When somebody was at home and we could 2 speak to them and they had time, we would ask them. 3 So, yes, we did. 4 When they were not at home, we did not make 5 other efforts to gain leak his- -- history. 6 Q. And in those instances where someone told 7 you that there had been a leak, did you investigate 8 to determine the cause of that leak? 9 A. We -- the answer's yes. We certainly 10 performed a limited initial investigation in those 11 circumstances. 12 Q. When you are looking for evidence of leaks, 13 one of the ways that you can see if a shingle itself 14 is leaking is to pull it up and look at the back of 15 the shingle, isn't it? 16 A. Certainly, if there's a lot of leakage and 17 you pull it up, you might see fungal decay, it might 18 have rotted through the felt paper and the roof deck. 19 Certainly, that would be a solid indication of a -- a 20 leak at that point. 21 But simply stains or other things, not a 22 particularly good indi- -- indication of whether the 23 shingle itself leaks. There's so many things that 24 can cause such stains. 25 So absent -- absent something that shows Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 9 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 124 1 make emergency repairs at, effectively, any and all 2 cost and effort. 3 Q. So it's a function of the volume of water 4 that's leaking in? 5 A. It's a function of the consequence. It 6 doesn't take much water over a -- over a bed before 7 it's an emergency. A little bit -- you know, a 8 significant amount of water in a garage, maybe it's 9 not catastrophic. It -- it -- it is circumstance 10 dependent. 11 But the fact is is that it's the type of 12 failure that takes away the opportunity to do what 13 should be done, and that is, replace roofs before a 14 catastrophic failure. 15 Q. So how long -- based upon your inspection 16 of the 351 Atlas roofs -- before I ask that, let 17 me -- let me scratch that. 18 You did not see any instances of 19 catastrophic -- sudden catastrophic shingle failure 20 on any of the 351 roofs that you attributed to either 21 blistering, cracking, or granule loss; is that 22 correct? 23 A. That is correct, I did not. 24 Q. So based upon your inspection of 351 roofs, 25 one of which was 16 years old, the Dickson roof, you Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 10 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 167 1 events. 2 Q. And that's true of the general population 3 of shingles, as well; in the general population of 4 shingles, a shingle can fail any time? 5 A. It should not fail under reasonably 6 foreseeable weather events at any time. These 7 shingles, because of deterioration, are in a 8 different state than a shingle that still has 9 reasonable performance life with it because of the 10 deterioration of these shingles and the lack of 11 deterioration there. 12 Q. And you hold that opinion despite the fact 13 that none of them have leaked or blown off as a 14 result of the weather events that had occurred prior 15 to your being there as a result of a blister, crack, 16 or a granule loss? 17 MR. BRYSON: Objection to form. 18 THE WITNESS: That's correct. On these 19 351, that is my opinion. 20 Q. (By Mr. Pieper) Now, there's -- you're 21 not -- you're not saying that all blisters, cracks, 22 and granule loss on the overlay of a Chalet or 23 Stratford shingle are going to inevitably cause that 24 shingle to prematurely fail? 25 MR. BRYSON: Objection. Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 11 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 224 1 year? 2 A. I don't remember. I just don't remember. 3 I'd have to go back and look and see when -- when it 4 was. Easy to do, but I don't remember. 5 Q. Have you ever spoken with Anthony Mattina? 6 A. Yes, sir. 7 Q. How many times have you spoken with him? 8 A. Once. 9 Q. When was that? 10 A. Last night at dinner. 11 Q. Do you rely on Anthony Mattina as a portion 12 of the basis for any of your opinions? 13 A. Yes. I do rely on his affidavit, I think 14 is the right word, as one of the items that I relied 15 upon in forming my opinions. 16 Q. Did you rely on both his April affidavit, 17 as well as his rebuttal affidavit in August? 18 A. Yes. I don't remember it having that name, 19 but I do include in both reports references to 20 Mattina affidavits. 21 Q. How many Chalet roofs did -- did you 22 include in your survey that were located in the state 23 of Florida? 24 A. My memory is that it was just one, but I 25 would have to go back to results to see if that -- Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 12 of 13 855-282-1018 404-817-9606 VERITEXT NATIONAL COURT REPORTING COMPANY Page 225 1 not there -- yeah, there's -- Seabird I -- I knew of. 2 I don't recall others, but I'd have to go back and 3 check. There's a exhibit -- there's an appendix to 4 my report that lists every property. I just don't 5 have it in my mind. 6 Q. Well, I've not seen any other than the 7 Seabird roof. Assuming that the Seabird roof is the 8 only roof that SGH or yourself inspected in the state 9 of Florida, is one roof a statistically significant 10 sampling of roofs in the state of Florida for 11 purposes of determining whether other Chalet and 12 Stratford roofs in the state of Florida have the 13 like, kind, and condition that lead to your opinions? 14 A. I didn't base my investigation on simple 15 random sampling or a statistical sampling. If you 16 were to do an investigation on that basis, I cannot 17 imagine one being sufficient. But that's not what I 18 did. 19 What I did was identify 351 roofs with the 20 same condition, effectively the same condition, 21 effectively failed, supported by Atlas' own 22 documentation and my other work, and I did not base 23 my opinion -- do not base my opinion on a random 24 sampling. 25 Q. You are extrapolating the observations you Case 1:13-md-02495-TWT Document 391-9 Filed 07/12/17 Page 13 of 13 EXHIBIT “H” Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 1 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 1 11339 NE 8th Court, Biscayne Park, Florida (Seaberg Residence) Moore Hackney & Associates, PLLC (MHA) conducted an investigation of Atlas Stratford shingles at the residence of Fred and Penny Seaberg located at 11339 NE 8th Court, Biscayne Park, Florida. The specific purposes of this investigation were to determine the current condition of the roof deck and roof assembly (underlayment, flashings and shingles) and evaluate the performance of the Atlas Stratford shingles. As part of my investigation, I made site visits on January 6 and 22, 2015. During the site visits, I made visual observations of the shingles and exterior building envelope, removed shingle samples in two locations, investigated reported leaks at five locations (including two locations where we removed samples), took moisture readings of the roof sheathing at five locations, and observed the interior and attic of the residence. Description The structure is a one‐story, single family house. The exterior walls are finished with a combination of brick veneer and Portland cement stucco. The roof is covered with Atlas Stratford shingles. No gutters are installed along the eaves. For orientation purposes, the front of the house is designated as facing west. Background The house was constructed in 1964 according to the homeowners. The Atlas Stratford shingles were installed in September 2004. The homeowner filed a warranty claim with Atlas in September 2012. The homeowner has reported multiple roof leaks. Documents Reviewed As part of this investigation, we reviewed the following documents:  Atlas Warranty Claim forms dated September 21, 2012  Atlas Inspection/Lab Report dated January 2, 2013  Deposition transcripts of Fred and Penny Seaberg dated January 23, 2015  Murphy Roofs letter dated December 2, 2012.  Photographs and field notes produced by Simpson Gumpertz & Heger (SGH) from its inspection of the Seaberg house. Observations The following is a general summary of my observations of the exterior envelope, roof, interior and attic. Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 2 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 2 Roof Shingles and Assembly  Where anomalies were observed on the shingle overlay, observed conditions included cracking, blisters, and evidence of foot traffic damage.  Shingles were found to be more tightly adhered to the shingle below at the overlay sections of the shingles.  There were dozens of exposed nails either due to inadequate shingle coverage or due to nails backing out through the shingles. Shingle exposure varied from 4‐6 inches.  Previous repairs were observed at the north end of the residence over the kitchen and utility closet.  Dark stains (likely mildew) were observed on the east slope below the chimney. Mildew stains were also observed downslope from vent pipes on the same rear slope. An area of light colored (non‐stained) shingles was observed just below the chimney indicating that the paint on the chimney or the roof mastic at the base of the chimney was preventing the mildew from forming just behind the chimney.  Shingles on the west slope exhibited cracks on the overlay tabs in much greater frequency that those on the east facing rear slope.  Two shingles were missing from the east slope and one was missing from the northwest corner of the north gable.  Three areas of different colored shingles were observed. Shingle and Underlayment Sampling and Moisture Testing Shingles were removed, and felt and decks were exposed, at two locations on the roof, identified below as TC‐1 and TC‐2. Eight shingles were removed at each location (total of 16 shingles removed). Test Cut 1 (TC‐1)  The shingles at TC‐1, labeled FL1‐001 A‐H, were removed in an area at the north end of the house where leaking had been reported by the homeowners above the kitchen (also discussed in this report as Leak Location 1 below). The shingles came from the main west slope. Underlayment samples were marked FL1‐001 I‐J and were also preserved.  No evidence of leakage through the shingles was found on the backs of shingles that were removed. The backs of shingles did not exhibit any abnormality or evidence of failure.  Moisture levels in the wood plank deck were obtained using a Delmhorst BD‐2100 meter. Moisture levels ranging from 7.0‐9.1% were recorded on the meter’s wood scale. Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 3 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 3 Test Cut 2 (TC‐2)  The shingles at TC‐2, labeled FL1‐002 A‐H, were removed from the center of the west slope where leaking had been reported by the homeowners above the foyer (also discussed in this report as Leak Location 2 below). An underlayment sample was marked FL1‐002 I and was also retained.  The backs of shingles that were removed did not exhibit any abnormality or evidence of failure. No evidence of leakage through the shingles was found on the backs of shingles that were removed.  Moisture readings in the deck ranging from 7.2‐40% were recorded. High readings in the deck were the result of an active leak not attributable to the performance of the shingles —see Leak Location 2 in the following section. Attic  The attic was extremely difficult to maneuver in due to the low slope of the roof.  A stain was observed around a vent at the north end of the attic— near a kitchen vent pipe.  Some rotted wood was found around the attic access opening—but, it didn’t appear to be the result of a roof leak.  Ventilation was provided through soffit and ridge vents. General Observations  A large oak tree is located at the north end of the residence. Satellite imagery shows the north end of the house covered by branches of this tree. At the time of our site visits, limbs had been trimmed so that none were overhanging the roof. Leak Investigation The homeowners reported four separate leaks during our first site visit on January 6, 2015. They reported a subsequent leak about a week later which was investigated on January 22, 2015. All five leaks were investigated and found to be unrelated to the performance of the shingles, but rather related to installation and construction deficiencies, as discussed below. Leak Location 1  The Seabergs stated the leak above the kitchen started approximately 3‐4 years ago.  An attempt at a repair was made by a neighborhood roofer. Based on our inspection, the repair was at best a temporary patch that did not address the underlying cause of the leak.  Stains were observed on the top and bottom of the felt underlayment in an area where a tear in the underlayment was also found.  The wood decking below the stained/torn underlayment was deteriorated. Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 4 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 4  A shingle was torn above where the stained underlayment and deteriorated decking was found.  Some of the deteriorated wood deck may have suffered from pest infestation, possibly termites.  Moisture levels ranging from 7.0‐9.1% were recorded on the meter’s wood scale.  The causes of the leak were a nail hole in the shingles combined with a low spot in the wood deck where water collected and a split in the underlayment where water entered the roof. Leak Location 2  The homeowners reported that the stains on the foyer ceiling were first noticed about two years ago and had leaked as recently as a week before our site visit on January 6, 2015.  The area of the leak on the ceiling was measured from the outside wall and from the entrance door. This stain location was located on the roof using a series of measurements up the roof slope from the eave and to the left/right of the entrance door frame.  An exposed and rusty nail was found in the area of the leak on the foyer ceiling. The nail was exposed because the shingle installation was improper, resulting in an irregular tab exposure of between 4½ and 5¼ inches.  Stains were observed on the top and bottom of felt underlayment directly below this exposed nail.  The wood deck below the stained underlayment was deteriorated and wet.  Moisture readings in the deck ranging from 7.2‐40% were recorded. A reading above 19% indicates high moisture content. The high moisture readings were consistent with the homeowner’s statement that the foyer had very recently experienced leaking.  The lawyer present for the plaintiffs was shown this area of the roof and the cause of the active leak before our roofer repaired this area. Leak Location 3  The Seabergs stated the leak above the utility room electrical panel began sometime in 2011.  The nails used to attach the shingles to the wood deck were loose in the area where leaking was described. It appeared that roof nails had been driven through a pre‐ existing rotted roof deck.  The felt underlayment above the rotted area of decking was torn and damaged.  The shingles were found to be in good serviceable condition on the front and the back of the shingle. There was no evidence of water coming through the shingles. Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 5 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 5  The deteriorated wood decking was found to extend inward from the rake edge outboard of the exterior wall of the house. Based on the deck condition, apparently water had been getting under the shingles from the rake edge when the previous roof was in place (prior to the installation of Atlas shingles), and the deteriorated deck had not been repaired prior to installing the Atlas shingles in 2004.  Moisture readings ranging from 9.2‐12.6% were recorded. Leak Location 4  According to the homeowners, the leak in the dining room ceiling started sometime in 2011 after the utility room leak developed.  A fastener used to attach the wood decking to the rafters had backed out through the overlying felt underlayment layer and the shingle creating an open avenue for moisture penetration. Grooves between adjacent pieces of decking appear to have spread water that entered the roof assembly to a location where it entered into the house.  No evidence was found suggesting the Atlas shingles themselves were the cause of the leaks. The shingles did not exhibit any signs of failure or damage to the front or back in the area where the leaking developed. No evidence of moisture leakage was observed on the back of the shingles.  Moisture readings ranging from 13‐14% were recorded. Leak Location 5  The Seabergs reported that a stain on the foyer ceiling developed in a different spot with a week or so after our first site visit. We returned to the residence to determine the cause of this new leak on January 22, 2015.  Two loose and rusty shingle nails were found in the area where the new leak developed.  Stains on the underlayment and deterioration of the roof deck were found just upslope of the area in the foyer ceiling where a stain had developed.  There was no evidence of staining or rot beyond this isolated area.  Following repairs on January 22, the roofer performed a hose test at this area to ensure no leak location was missed. After 30 minutes of continuous soaking, no leaks developed in the foyer ceiling. Conclusions Based on my observations, shingle sampling, moisture testing and leak investigation, I have the following opinions. Shingles Some of the Atlas Stratford shingles exhibited cracking, granule loss, and blisters on the overlay pads. Evidence of surface damage, indicative of foot traffic and/or mechanical impact was also observed. At the five areas where shingles were removed (including Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 6 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 6 two test cut locations), I found no evidence that surface conditions visible on the overlay pads extended into or through the base shingle. The surface conditions I observed during my surveys are not affecting the moisture shedding or load resisting performance of the shingles. Exposed nails (improper installation) were found throughout the roof and were found to be the source of several of the homeowner‐reported leaks. Roof Assembly The roof assembly was evaluated at five leak locations reported by the homeowners. At all five locations, various installation issues were found that related directly to the leaking observed by the homeowners, including improper nailing, shingle misalignment, improper deck preparation, and improper underlayment installation. The shingles themselves did not exhibit failure due to blisters, cracks, or excessive granule loss on the overlay pads of the five locations tested. Attic The attic of this residence is somewhat inaccessible due to the location of the HVAC ductwork and the low slope of the roof which creates minimal space to maneuver. Cross ventilation is provided by soffit and ridge vents. SGH Field Documentation Field notes and photographs produced by SGH reflect that SGH removed samples at seven locations on the Seaberg roof, exposing a very small area of the deck at two of the locations. Photographs of fronts and backs of all shingles removed show no evidence of prior leakage through or onto the backs of the shingles. The backs of the shingles appear serviceable and intact, with no abnormalities. SGH’s notes and photographs do not reflect any leak investigation conducted by SGH at this residence. Summary Based on examination of the roof, exterior building envelope, attic, and shingles, I conclude the Atlas Stratford shingles have surface conditions on the overlay pads that are visible under close inspection, but minimally noticeable from the ground near the house. Shingle removal, moisture readings, leak investigation and visual inspection of the roof and in the attic demonstrate that the Atlas Stratford shingles are performing to shed water and resist applied loads as intended. The Seabergs received a letter dated December 2, 2012 from their roofer, Mr. Denis Murphy, of Murphy Roofs, stating the following: “During a recent inspection of this roof, it was found that a 11 x 43 foot, section of the roof shingles have lost their intigerity [sic]. These shingles are in an area of the roof that is under a section of the neighbors Florida Oak tree (see Google Earth photos enclosed). The shingle [sic] have Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 7 of 8 11339 NE 8th Court, Biscayne Park, Florida Atlas Shingles 7 become porous and have begun to leak.” I do not agree with Mr. Murphy’s assessment that the shingles have lost their integrity, based on my investigation. The roof leaks reported by the homeowners are due to improper preparation of the wood deck, and improper application of felt underlayment and the shingles (improper nailing and shingle alignment) by the roofer who installed the shingles in 2004. Based on these conditions I observed, the homeowners may experience additional leaks in new locations in the near future. Case 1:13-md-02495-TWT Document 391-10 Filed 07/12/17 Page 8 of 8