A federal judge in the Southern District of Indiana has dismissed, with prejudice, a class action lawsuit brought by a group of disgruntled race car fans, who were attending the U.S. Grand Prix last year when a majority of the team competing in the event withdrew at the last minute, citing safety concerns.
The judge noted specifically that “a spectator’s opinion about the quality of an event … is simply not actionable.”
The event that led to the suit actually occurred in the days before the June 19 race when several of the teams complained that the layout of the track was leading to tire failures and could subsequently lead to crashes in practice and during the race.
The Michelin teams voiced their concerns to FIA (Formula One’s governing body) and presented several options that would enable them to race, such as establishing a chicane on one of the especially dangerous corners to reduce the speed of the participating cars. When no solution was reached, the cars took the formation lap on race day, before bailing out to the pits and leaving the track.
This left six cars to compete in an uneventful race before more than 100,000 very frustrated fans. Some of the fans sued.
An Avalanche of Class-Action Suits
Among the class action complaints was an action brought in the Southern District of Indiana by Larry Bowers. Bowers claimed that the defendants – FIA, Formula One Group, IMS and Michelin – were “fraudulent” in that they reached an “agreement” on the day of the race that the Michelin teams would participate in the formation lap, so that they could “contend that a race occurred, and in an effort to prevent ticket holders, such as Bower and others from obtaining a refund for the price of their tickets and other costs.”
Bowers, through attorney William Bock, III of Kroger, Gardis & Regas in Indianapolis, went on to claim that Michelin breached an agreement to provide usable tires in conformity with Formula One rules and that the other defendants breached their agreement “to conduct the 2005 in conformity with the F1 Regulations and Code.”
The plaintiffs claimed specifically that a race never occurred and that the plaintiffs should receive damages for the cost of the ticket of the event as well as the cost to travel to the event.
That theme was echoed in another class action complaint brought by lead plaintiff Alan G. Symons, also in federal court. Specifically, the plaintiff alleged that “plaintiff in no way shape or form bargained for the ‘race’ that consisted of only six starting drivers, the majority of which are considered largely ‘uncompetitive,’ as evidenced by their previous performance in the racing series. Plaintiffs would never have purchased tickets to such an event nor would they have gone through the time and trouble necessary to attend the same. Defendants presentation of a ‘race’ of this nature … constitutes a complete and utter failure of the consideration which the plaintiffs bargained for in this contract.”
Other causes of action identified in the Symons complaint were for fraud and deceit, negligent misrepresentation, concealment and action of rescission. Symons and the rest of the plaintiffs were represented by Indianapolis lawyer K.C. Cohen and David G. Symons of North Hollywood, California.
Three other separate class action complaints emerged in federal court, which were fairly similar to the Bowers and Symons complaints. Attorneys representing those plaintiffs were from the Indianapolis firms of Cohen & Malad, William N. Riley and Schuckit & Associates.
Two other complaints surfaced in a Marion Superior Court in Indiana, while another was filed solely against the IMS in the Circuit Court of Cook County, Illinois. In the latter, Chris Katsenes and the class argued that the defendant transacts business in Illinois
Their claim centered the alleged failure “to provide a competitive U.S. Grand Prix racing event.” They also cited the Illinois Consumer Fraud and Deceptive Business Practices Act as the basis for a consumer fraud count. In Count IV, the plaintiffs alleged unjust enrichment, noting that the “defendant will receive a substantial windfall … to the damage and detriment of the plaintiff and the class” if their expenses are not reimbursed. Katsenes was represented by Larry D. Drury of Chicago.
The IMS is represented by Mark Richards of Ice Miller in Indianapolis.
In the weeks after the controversy, the various parties staked out their positions. In the face of sanctions by FIA, the Michelin teams issued a statement on June 29, where the teams defended their decision to participate in the formation lap, claiming “they hoped, until the very last moment, that a solution would be found.”
They also hinted at a possible legal strategy that they would have broken Indiana state law if they had actually participated in the race.
In their statement, they said that if they had raced with the faulty tires and an accident had occurred that injured participant or fan, “there would have been criminal charges of the utmost gravity, as well as substantial civil litigation, brought against the teams and their principals, as well as against the FIA and others.”
During his press conference, Dennis claimed that he phoned Michelin at 6:30 a.m. on June 19 “and they advised we had an extremely difficult, actually extremely critical problem. Michelin advised us we had no tires whatsoever we could race with. About 8 o’clock, we received a document, which said we were not permitted to race under any circumstances – unless the speed could be reduced in that one particular corner.
“Even if we had raced with no accident, we would have been criminally prosecuted. The simple position was we couldn’t race.”
Weeks later, the defendants — Michelin North America, Inc. and the Indianapolis Motor Speedway – initiated another strategy, introducing a ticket refund process for ticket holders of the events.
Still, the suits persisted, spawning the instant opinion
Plaintiffs Fail To Assert Actionable Injury
In its analysis, the court first reviewed the grounds for granting a motion to dismiss, pursuant to Federal Rule of Civil Procedure 12(b)(6), one of which occurs is when “it is clear that no viable cause of action exists.”
The plaintiffs initially alleged that in their subjective opinion the event was sub-standard.
Reviewing that argument, the district judge sided with the defendant, writing that “the uniform weight of established case law holds that a failure to satisfy the subjective expectations of spectators at a sporting event is not actionable under law. See e.g., Seko Air Freight, Inc. v. Transworld Systems, 22 F. 3d 773, 774 (7th Cir. 1994);” Charpentier v. Los Angeles Rams Football Co., Inc., 89 Cal. Rptr. 2d 115, 124 (Cal. App. 1999); Beder v. Cleveland Browns, Inc., 717 N.E. 2d 716, 720-21 (Ohio App. 1998); Strauss V. Long Island Sports, Inc., 60 A.D. 2d 501, 510-11 (N.Y. App. Div. 1978); Bickett v. Buffalo Bills, Inc., 122 Misc. 2d 880, 882 (N.Y.Sup. 1983).
Realizing that it was a losing argument, the plaintiffs changed their approach, instead arguing that they are basing their claims on “objectively verifiable contractual expectations.” The court decried this argument as a “red herring.”
The “plaintiffs’ broad assertion that as spectators they have an ‘objective’ basis for a lawsuit any time a particular sports’ governing body’s rules are broken is not plausible,” the court wrote. “If that were the law, spectator would have a viable cause of action permitting challenges to some part or another of almost every single sporting event requiring a ticket for admission.” It went on to describe the imperfect nature of sporting events, with “blown calls” and such. “Grousing about the judgment calls/rulings of officials in a sporting event is part and parcel of being a sports fan; and it most assuredly is not a legitimate basis for claiming a legally actionable injury.”
The court also dispatched with the plaintiff’s contention that the participants were somehow obligated to compete, writing that the participants “owed no legal duty to let the preferences of the spectators trump their own good judgment.” It cited the analogy of a coach that benches a player for disciplinary reasons, and the lack of legal recourse for the participant in such instances.
In Re: 2005 U.S. Grand Prix; S.D.Ind.;Master Docket No. 1:05-cv-914-SEB-VSS;6/15/06
