The opinion of the court was delivered by: Irma E. Gonzalez, Chief Judge United States District Court
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT [Doc. Nos. 26 and 44]
Presently before the Court are defendant Roadtrek Motorhomes, Inc.'s ("Roadtrek") and defendant McMahon's RV Superstore, Inc.'s ("McMahon's") motions for summary judgment on all of the claims plaintiffs have brought against them. Plaintiffs Betty Sue Harlan ("Harlan") and Glenn C. Hemphill ("Hemphill") bring this action against McMahon's, Hanmar Motor Corporation ("Hanmar"), Roadtrek, and First Extended Service Corporation ("First Extended"). In their first amended complaint, plaintiffs allege: (1) violations of the federal Magnuson-Moss Warranty Federal Trade Commission Improvement Act, 15 U.S.C. §§ 2301 et seq. ("Magnuson Moss Act"); (2) violations of California's Consumer Legal Remedies Act, Cal. Civ. Code § 1750, et seq. ("Consumer Legal Remedies Act"); (3) violations of ten different provisions of California's Song-Beverly Consumer Warranty Act, Cal. Civ. Code § 1792, et seq. ("Song-Beverly Act"); (4) Breach of Express Warranty under the California Commercial Code; (5) Breach of Implied Warranties of Merchantability and Fitness under the California Commercial Code; (6) Breach of Contract; (7) Breach of Implied Covenant of Good Faith and Fair Dealing; (8) Strict Products Liability; (9) Negligence; and (10) Fraud. Plaintiffs seek general and special damages, as well as damages for: loss of use of the vehicle; emotional distress; property damage; and numerous types of statutorily-prescribed damages, penalties, and attorney's fees. Specifically, plaintiffs allege causes of action (1)-(5) and (8)-(10) against Hanmar/Roadtrek,*fn1 and causes of action (2)-(10) against McMahon's.
Plaintiffs have filed oppositions to both motions. Defendants have filed replies to the oppositions. Plaintiffs have also filed evidentiary objections. The Court heard oral argument on March 3, 2009. After considering the parties' arguments, and for the reasons explained herein, the Court: (1) grants Roadtrek's motion in part; (2) denies Roadtrek's motion in part; (3) grants McMahon's motion in part; (4) denies McMahon's motion in part; and (5) overrules all of plaintiffs' evidentiary objections.
Plaintiffs owned a large "Class A" motorhome for many years, but eventually decided to purchase a smaller motorhome that required less maintenance and was easier to drive. On April 17, 2004, after researching Roadtrek vehicles, plaintiffs visited McMahon's Irvine branch to view Roadtrek models. On that day, plaintiffs paid McMahon's a $10,000 deposit for a Roadtrek 200 Popular, a "Class B" van-size motorhome. On May 14, 2004 plaintiffs signed a retail installment sale contract to buy the motorhome ("the vehicle"). Plaintiffs also purchased a Recreational Vehicle Parts and Labor Agreement ("service contract") administered by First Extended for $2,995.00. Plaintiffs paid a total of $76,734.22 for the vehicle, including taxes, fees, and the service contract.
McMahon's provided plaintiffs with the Roadtrek owners' manual, which included warranty information. The warranty coverage consisted of three parts: an automotive warranty, an appliance warranty, and the Roadtrek Limited Warranty. Chevrolet provided the automotive warranty for the chassis. The Roadtrek Limited Warranty (further detailed infra) covered the coach. The appliance warranty stated that the following individual appliances were not warranted by Roadtrek, but were covered by the appliances' respective manufacturers: air conditioner, electrical converter/charger, furnace, generator, microwave oven, range hood exhaust fan, refrigerator, stove, toilet, water pump, and water heater.
Plaintiffs contend the vehicle began to experience several problems shortly after purchase. When plaintiffs brought the vehicle home from the dealer Hemphill noticed the side door was not flush with the vehicle's body, "was not closing or opening properly and was difficult to operate." [Hemphill Decl. ISO Plts' Motions ("Hemphill Decl."), Doc. Nos. 67-3 and 68-3, ¶ 4; May 23, 2008 Deposition of Glen C. Hemphill ("Hemphill Depo.") Ex. 9 to Plts' Notice of Lodgment ("NOL"),
p.138.] Furthermore, shortly after their purchase plaintiffs had hoped to take the vehicle to Pismo Beach, California, but had to cancel the trip because the refrigerator would not operate on propane. Hemphill called McMahon's on May 20, 2004 to report the problem and brought the vehicle in for service that same day. Hemphill claims McMahon's told him the door could not be fixed and that the propane problem came from a "slow leak" in the system.
Plaintiffs first attempted to take a trip in the vehicle on September 1, 2004. On the way to Oxnard, California, plaintiffs noticed the electrical system cutting off power to the microwave and roof air conditioner. Plaintiffs stopped at McMahon's, where technicians restored electricity to the air conditioner, but were not able to restore electricity to the microwave. Plaintiffs agreed to return to McMahon's after their trip. During the trip to Oxnard, rainwater leaked into the coach unit "through a vent in a steady stream." (Hemphill Decl., ¶ 6.) Plaintiffs also experienced problems with leaking propane (preventing them from using the refrigerator), an overflowing toilet, falling molding trim, and missing upholstery buttons. (Hemphill Decl., ¶ 6.)
Plaintiffs called Roadtrek directly about warranty repairs on September 4, 2004. They complained about the problems experienced on their trip to Oxnard, and additionally reported the propane gas would not turn on, the curtain track had come undone [Roadtrek Call Log, Deakins Decl. ISO Dfdts' Motions ("Deakins Decl."), Doc. Nos. 31 and 50, Ex. B,) and that the curtains were stained from the roof leak. (Hemphill Decl., ¶ 7.) Plaintiffs visited McMahon's Irvine, California location for warranty repairs on September 28, 2004. The associated work order states McMahon's repaired the circuit breaker, the leaking roof air conditioner ("roof leak"), the running toilet, loose rubber trim around the door, missing buttons above the entry door, the front privacy curtain, and the barbeque propane (LPG) regulator. [Schilperoort Decl. ISO Dfdts' Motions ("Schilperoort Decl."), Doc. Nos. 29 and 48, Ex. D.] Plaintiffs, however, contend they were told that there was "no fix" to the roof leak, and that water intrusion would result every time "the motorhome was pointed in a certain direction in the rain." (Hemphill Decl., ¶7.)
Plaintiffs next attempted to use the vehicle on a trip to Las Vegas, Nevada on June 26, 2005. They determined that McMahon's did not fix the propane leak because the tank was completely empty when they left home. (Hemphill Decl., ¶ 9) Plaintiffs stopped, had the tank filled, and after turning on the propane valve discovered a "blasting leak" from under the vehicle. (Deakins Decl., Ex. C.) Plaintiffs canceled their Las Vegas hotel reservations for the following day and brought the vehicle into McMahon's for service on June 27, 2005. (Id.)*fn2 McMahon's found a leaking propane accessory valve assembly, but did not have a spare part in stock, and told plaintiffs they could not be scheduled for installation of the new part until August 2005. (Id.)
Notwithstanding the missing part, Plaintiffs left for Las Vegas on June 29, 2005 but allege they had problems with the generator and propane system, which impeded use of the refrigerator and air conditioning. Plaintiffs cancelled the next two days of the trip because of these problems, which made them exceedingly uncomfortable in the summer heat. (Hemphill Depo. at 185, 188; Deakins Decl., Ex. C.) Plaintiffs also claim they cancelled an upcoming trip to Seattle, Washington because McMahon's did not have the part. (Deakins Decl., Ex. C; Hemphill Decl., ¶ 11.)
Plaintiffs called Roadtrek on July 18, 2005, and spoke to Christopher Deakins ("Deakins,") the service and warranty coordinator, to report they were having "lots of issues with the van." (Roadtrek Call Log, Deakins Decl., Ex. B.) Plaintiffs reported the vehicle's refrigerator had stopped working on propane, and the air conditioner had stopped working on the generator. Plaintiffs also reported that they had a propane leak, a water leak from the air conditioner area, and a water leak from the rear window.
Mr. Hemphill contends he brought the vehicle to McMahon's on August 16, 2005 and they provided him with a list of necessary repairs for the vehicle. (Hemphill Decl., ¶ 13.) This list called for repair work on the propane system, the rear window latches, the side door molding, a loose table, loose entertainment center doors, a rattling wardrobe door, and a malfunctioning closet drawer, a screw in the floor trim, and a missing water drain bracket. [Obeid Decl. ISO Dfdts' Motions ("Obeid Decl."), Doc. Nos. 27 and 45, Ex. B.]*fn3 Plaintiffs state they forwarded a "memo" listing these repairs to "Roadtrek and/or McMahons"(Hemphill Decl., ¶ 13,) and they noted additional problems with the generator "running rough during a trip to Las Vegas," the refrigerator not working on propane, a still-missing propane regulator, a leaking rear window, a kitchen rug stained from refrigerator food leakage, a missing cover on the electrical box near the engine, and a missing fresh water drain bracket. (NOL, Ex. 13, PTLF 59.)
In early January 2006, plaintiffs drove the vehicle to San Rafael California. (Hemphill Depo at 271.) Although the propane system and generator functioned on that trip, strips of metal molding and trim became detached from the interior of the vehicle. (Hemphill Depo at 273-274.) Mr. Hemphill states that on February 1, 2006 he forwarded another list of necessary repairs to "Roadtrek and/or McMahon's." (Hemphill Decl., ¶ 14.) In addition to previously-documented problems, the list describes loose screws in the overhead panels, a loosened shelf on the DVD unit, a bathroom door that opened during transit, and a problem with the curtain bracket. (NOL Ex. 13, PTLF 65). Plaintiff sent this list to Roadtrek.
A March 14, 2006 email from James Hammill ("Hammill,") Roadtrek's president, to Mr. Deakins indicates an agreement that Mr. Hemphill would take the vehicle to McMahon's on April 18, where they would discuss his final list of repairs and "they will repair everything once and for all." (NOL, Ex. 1, RMI 100.) A March 20, 2006 email from Mr. Deakins to Paul Schilperoort, Roadtrek's director of service and parts, states "we need to get this customer taken care of as his issues go back quite sometime." (NOL, Ex. 1, RMI 101.)
Plaintiffs visited McMahon's Stanton, California location for warranty repairs on April 18, 2006. The associated work order states McMahon's repaired: loose screws in the vehicle's overhead panels, a rattling DVD shelf unit, loosened mounts on the front and rear tables, loosened trim around the rear door, the rattling closet drawer, a curtain bracket slide, the propane regulator valve, a missing electrical box cover, a detached rear view mirror, and the rattling rear side door. The technician noted the missing fresh water drain bracket and ordered a new part. Additionally, the technician checked the vehicle in response to plaintiffs' complaints that the shower door opened while in transit, electrical problems prevented the refrigerator from functioning, and water leaked through the rear window. The technician found none of these additional problems existed. [Schilperoort Decl., Ex. E.] On May 9 and May 23, 2006 (Hemphill Decl., ¶ 16) plaintiffs visited McMahon's to obtain additional repairs to the side door and table leg.
On November 21, 2006, Mr. Hemphill called Roadtrek to report difficulty in opening the side door from the outside. (Deakins Decl., Ex. B.) Mr. Hemphill and Mr. Deakins agreed that Mr. Hemphill would take the vehicle to McMahon's for repairs on the door. On November 30, 2006 plaintiffs returned to McMahon's. The associated work order states "[r]emoved the door panel and stricker [sic] is not adjustable. Inspected door. Door looks to be out of alignment[,] larger gap at the top of door and as door goes down the space gets more narrow. Recommend body shop to advise." (Schilperoort Decl., Ex. G).
Mr. Deakins called Mr. Hemphill on January 9, 2007 to ensure the door was repaired properly, and Mr. Hemphill reported the door was "still a problem as well as several other new things." (Roadtrek Phone Log, Deakins Decl., Ex B.) Mr. Deakins arranged to meet with Mr. Hemphill during the week of January 15, 2007. (Deakins Decl., ¶ 8-9.) Mr. Deakins met with Mr. Hemphill on January 17, 2007 at the outdoor storage facility where plaintiffs kept the vehicle.*fn4 Mr. Deakins inspected the side door and described it as: "fully operational. The two stage latch engaged and disengaged freely. The door did not drag or bind, and was properly secured on its hinges." (Deakins Decl., ¶ 9.) Mr. Deakins also notes that "Mr. Hemphill, who is elderly, had a tendency to slowly pull on the handle in a limp motion." Mr. Deakins states he attempted to adjust the door catch in an attempt to make it easier to open, but that Mr. Hemphill still struggled with the door. (Id.)
In mid-November 2007, plaintiffs entered the vehicle for the first time since August 2007 and found the television had detached from the wall mount screws and trim had pulled out of place. (Obeid Decl., Ex. C.) In addition, the side door still "move[d] along its hinge in a heavy and cumbersome manner" and was not flush with the side of the motorhome. (Hemphill Decl., ¶ 17.)
On February 5, 2008, defendants' expert Ben Spengen conducted a preliminary inspection of the alleged defects. Mr. Spengen found the vehicle to be in operational condition, and the side door to be fully functional. Mr. Spengen also found no leaks in the propane system, but did not fill the propane tank to capacity to verify this finding. [Spengen Decl. ISO Dfdts' Motion, ("Spengen Decl."), Doc. Nos. 32 and 51, Ex. 2., p. 5.] On May 28, 2008, Mr. Spengen conducted a full inspection of the vehicle with Mr, Deakins present. Mr. Spengen concluded the vehicle was "fully operational" and that its use as a recreational vehicle was not impaired. The side door and latch operated properly, and he videotaped Mr. Deakins opening the side door using only the small finger of his right hand. Mr. Spengen's report does not indicate that he filled the propane system to capacity to test for a leak. He noted the LPG regulator leaked, but stated such leaks were very common for that type of valve. Mr. Spengen ultimately concluded the vehicle was worth approximately $34,000, consistent with the national average for similar used vehicles. (Spengen Decl., Ex. 3.) Mr. Hemphill maintains the propane system continues to leak, because when he checked the propane tank in January 2009 it was completely empty. (Hemphill Decl., ¶ 22).
Summary judgment is proper where the pleadings and materials demonstrate "there is no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A material issue of fact is a question the trier of fact must answer to determine the rights of the parties under the applicable substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 248. Summary judgment may be granted in favor of a moving party on an ultimate issue of fact where the moving party carries its burden of "pointing out to the district court that there is an absence of evidence to support the nonmoving party's case." Celotex, 477 U.S. at 325; see Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1106 (9th Cir. 2000).
The moving party bears "the initial responsibility of informing the district court of the basis for its motion." Celotex, 477 U.S. at 323. To satisfy this burden, the moving party must demonstrate that no genuine issue of material fact exists for trial. Id. at 322. However, the moving party is not required to negate those portions of the non-moving party's claim on which the non-moving party bears the burden of proof. Id. at 323. To withstand a motion for summary judgment, the non-movant must then show that there are genuine factual issues which can only be resolved by the trier of fact. Reese v. Jefferson Sch. Dist. No. 14J, 208 F.3d 736, 738 (9th Cir. 2000) (citing Fed. R. Civ. P. 56; Celotex, 477 U.S. at 323). The nonmoving party may not rely on the pleadings but must present specific facts creating a genuine issue of material fact. Nissan Fire, 210 F.3d at 1103. The inferences to be drawn from the facts must be viewed in a light most favorable to the party opposing the motion, but conclusory allegations as to ultimate facts are not adequate to defeat summary judgment. Gibson v. County of Washoe, Nev., 290 F.3d 1175, 1180 (9th Cir. 2002). The Court is not required "to scour the record in search of a genuine issue of triable fact," Keenan v. Allan, 91 F.3d 1275, 1279 (9th Cir. 1996), but rather "may limit its review to the documents submitted for purposes of summary judgment and those parts of the record specifically referenced therein." Carmen v. San Francisco Unified Sch. Dist., 237 F.3d 1026, 1030 (9th Cir. 2001).
II. Plaintiffs' Evidentiary Objections
Plaintiffs argue the Court should exclude the opinions of defendants' expert Ben Spengen as untimely or alternatively, because they are inappropriate expert testimony.*fn5
A) Timeliness of Mr. Spengen's Final Report
Fed. R. Civ. P. 26(a) (2009) lists the requirements for disclosure of expert testimony during the discovery process. Fed. R. Civ. P. 26(a)(2)(D) imposes a duty on parties to supplement their expert disclosures if required by Fed. R. Civ. P. 26(e)). Rule 26(e) mandates that all disclosures shall be supplemented in a timely manner if incomplete or incorrect in a material respect. This supplemental information is due by the time of the party's pretrial disclosures under Rule 26(a)(3)(B) (30 days before trial unless the court orders otherwise). Fed. R. Civ. P. 26(e)(2) (2009).
In this case, defendants arranged for Mr. Spengen to conduct a visual inspection of the vehicle on February 5, 2008. (Spengen Decl., ¶ 4.) Defendants produced Mr. Spengen's "Preliminary Expert Report," based on that inspection, on or about March 21, 2008. [Howerton Decl. ISO Plts' Opps. ("Howerton Decl."), Doc. Nos. 67-4 and 68-4, ¶ 4.] In his preliminary expert report, Mr. Spengen commented, inter alia, on the vehicle's appliances, propane system, windows and doors, interior elements, an general functionality. With respect to the vehicle's side door, he noted the door was "fully functional," fit snugly against the jamb seal, did not rattle, and opened without a problem when the handle was fully extended. (Spengen Decl., Ex. 2, pp. 5-6.) Mr. Spengen also found that he needed to conduct further inspection of the generator and refrigerator. (Id., p. 4.)
Plaintiffs argue they stipulated to Mr. Spengen conducting additional testing of the generator and refrigerator. He performed this testing on May 28, 2008, eight days prior to the discovery cutoff. Defendants presented plaintiffs with Mr. Spengen's "final report," based on both his inspections, at his deposition on May 30, 2008. Plaintiffs argue, however, that the second inspection went beyond the scope upon which the parties agreed because "defendants' experts and staff conducted inspections of areas and items on the vehicle that were previously inspected, took photographs of the vehicle, and video of the side door." (Plts. Evid. Obj. at 6.) Specifically, plaintiffs claim the parties did not agree the second inspection could provide a second chance for Mr. Spengen to inspect the side door. Plaintiffs argue that all portions of Mr. Spengen's final expert report referencing the side door of the vehicle, and the video of Mr. Deakins opening the door should be excluded under Fed. R. Civ. P. 37(c)*fn6 because this information was not "supplemental" as defined by the federal rules. Defendants argue they properly produced the report as a supplemental expert report under to Fed. R. Civ. P. 26.
Because Mr. Spengen's preliminary report contained his opinion regarding the functionality of the side door, and the final report and video contained information consistent with those opinions, the Court finds the portions of his final report to which plaintiffs object were properly "supplemental" under Fed. R. Civ. P. 26(a)(2)(D), and do not disadvantage plaintiffs' case. Moreover, the supplemental disclosures were timely because they were not due until October 14, 2008. (Original Scheduling Order, Doc. No. 16.)
B) Propriety of Expert Testimony
Plaintiffs alternatively argue Mr. Spengen's testimony is not proper expert testimony because the subjects to which he testifies are not based in scientific, technical, or other specialized knowledge. (Opp. at 13; Plts' Evid. Obj. at 4.) Plaintiffs focus on Mr. Spengen's opinions regarding the opening and closing of the side door, arguing a determination of whether a motorhome door easily opens and closes is well within the province of common knowledge. Plaintiffs also argue the quality and workmanship of the motorhome interior, are "not outside anyone's ordinary experience operating a vehicle." (Plts' Evid. Obj. at 4.)
Federal Rule of Evidence 702 allows the admission of expert testimony where it will assist the jury in understanding the evidence or determining a fact in issue. Jurors will only be assisted by: (1) a qualified expert (2) testifying about a proper subject (3) in conformity with a generally accepted explanatory theory (4) with more probative value than prejudicial effect. United States v. Castaneda, 94 F.3d 592, 595 (9th Cir. 1996). The admissibility of expert testimony is within the sound discretion of the trial judge, "'who alone must decide the qualifications of the expert on a given subject and the extent to which his opinions may be required.'" United States v. Chang, 207 F.3d 1169, 1172 (9th Cir. 2000) (quoting Fineberg v. United States, 393 F.2d 417, 421 (9th Cir. 1968)).
Plaintiffs are correct that it may not take specialized knowledge to determine whether a vehicle's side door opens and closes without difficulty. However, the door's functioning is connected to larger issues regarding standards of workmanship for motorhomes, which are not matters within a layperson's knowledge. Someone such as Mr. Spengen, with many years' experience in the production of motorhomes*fn7 could assist the trier of fact in determining these standards. Plaintiff's evidentiary objections to Mr. Spengen's expert testimony are overruled.
III. Song-Beverly Act Claims (Plaintiffs' Third Cause of Action)
Plaintiffs' third cause of action alleges Roadtrek and McMahon's violated seven different provisions of the Song-Beverly Act, specifically: Cal. Civ. Code §§ 1792, 1792.1, 1793.1, 1793.2, 1793.22, 1793.23, 1793.24, 1794.4, 1794.41, and 1795.5. The Song-Beverly Act defines a broad class of consumer sales and specifies the requirements for the creation and exclusion of warranties accompanying such sales. 4 Witkin, Summary 10th (2005) Sales, § 314.
As an initial matter, plaintiffs have not opposed several of defendants' arguments under the Song-Beverly Act. Therefore, the Court grants summary adjudication in favor of Roadtrek and McMahon's on the following claims:Cal. Civ. Code §§ 1793.1; 1793.22; 1793.23; 1793.24; and 1795.5. The Court addresses the remaining claims below.
A) § 1792 Implied Warranty of Merchantability
Cal. Civ. Code § 1792 (2009) provides, "every sale of consumer goods that are sold at retail in this state shall be accompanied by the manufacturer's and the retail seller's implied warranty that the goods are merchantable." Unlike an express warranty, "'the implied warranty of merchantability arises by operation of law' and 'provides for a minimum level of quality.'" Isip v. Mercedes-Benz USA, LLC, 155 Cal. App. 4th 19, 26 (Cal. Ct. App. 2007) (citations omitted). Implied warranties of Merchantability under the Song-Beverly Act are defined at Cal. Civ. Code § 1791.1(a) (2009). Goods in conformity with the Act meet each of the following conditions: "(1) Pass without objection in the trade under the contract description[;] (2) Are fit for the ordinary purposes for which such goods are used[;] (3) Are adequately contained, packaged, and labeled[;] and (4) Conform to the promises or affirmations of fact made on the container or label." The duration of the implied warranty of Merchantability ...