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Clark v. Lg Electronics U.S.A., Inc.

United States District Court, Ninth Circuit

June 7, 2013

JEANETTE CLARK, individually and on behalf of those similarly situated, Plaintiff,
v.
LG ELECTRONICS U.S.A., INC., and DOES 1 through 25, inclusive, Defendants.

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS AND DEFENDANT'S DENYING MOTION TO STRIKE

JEFFREY T. MILLER, District Judge.

Plaintiff Jeannette Clark ("Plaintiff") filed a complaint in California State court on December 10, 2012 against LG Electronics U.S.A., Inc. ("LG"), which was later dismissed. Plaintiff filed a first amended complaint in California State court on January 14, 2013. On February 28, 2013, LG removed this matter to federal court. On April 8, 2013, LG filed a motion to dismiss under Federal Rule of Civil Procedure ("Rule") 12(b)(6) and a motion to strike under Rule 12(f). For the reasons explained below, LG's motion to dismiss is granted with leave to amend and LG's motion to strike is denied as moot.

I. BACKGROUND

On or about October 2011, Plaintiff purchased a LG refrigerator, Model No. LFX31925ST, for approximately $3, 200. FAC ¶ 13. She used her LG refrigerator in a manner consistent with its intended use. Id . The refrigerator allegedly had a Smart Cooling Plus system ("SCP system") "to keep your food fresh" and came with an express warranty for workmanship and materials. Id . ¶ 36.

Plaintiff claims that her LG refrigerator's main control panel came with inherent design and materials defects. Id . ¶ 6. Plaintiff explains that an alleged programming defect causes the SCP system to shut down, thereby defrosting the food in both the refrigerator and freezer and causing condensation to build up. Id . This ultimately results in the food spoiling. In addition, the re-freezing of the condensation causes doors and drawers to freeze shut and the ice chute to clog. Id . The only way to correct the programming defect is to unplug the refrigerator for 15 minutes, which reboots the control panel. Id . The programming defect allegedly occurs frequently and eventually results in the control panel burning out. Id.

Plaintiff further alleges that LG was aware of these problems. Plaintiff cites several complaints from the internet, which purportedly should have put LG on notice regarding the SCP system's defects. See, e.g., id. ¶ 37 (providing samples from websites such as consumer affairs and complaintsboard.com). However, of the complaints cited by Plaintiff, only one complaint was made prior to Plaintiff's purchase of her LG refrigerator. See id. (identifying one complaintsboard.com complaint as having been posted prior to October 2011). All remaining complaints were made in 2012. Plaintiff does not specify why LG would be aware of complaints posted on the internet on websites other than LG's own website.

Plaintiff claims LG never disclosed the SCP system's defect and that this failure to disclose resulted in Plaintiff and the proposed class overpaying for their LG refrigerators. Plaintiff has not limited her proposed class to any specific types of LG refrigerators. Plaintiff asserts five claims against LG: (1) violation of Consumer Legal Remedies Act ("CLRA"); (2) violation of the California Business & Professions Code § 17200, et seq. ("UCL"); (3) violation of California Business & Professions Code § 17500, et seq. for false and misleading advertising ("FAL"); (4) breach of express warranty; (5) breach of implied warranty (Cal. Civ. Code § 1790, et seq. and Cal. Comm. Code § 2314); and (6) violation of the Magnuson-Moss Warranty Act ("MMWA") (15 U.S.C. § 2301 et seq. ).

III. MOTION TO DISMISS

A. Legal Standard

For a plaintiff to overcome a Rule 12(b)(6) motion, the complaint must contain "enough facts to state a claim to relief that is plausible on its face." Bell Atl. v. Twombly , 550 U.S. 544, 570 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009). Factual pleadings merely consistent with a defendant's liability are insufficient to survive a motion to dismiss because they only establish that the allegations are possible rather than plausible. See id. at 678-79. The court should grant 12(b)(6) relief only if the complaint lacks either a "cognizable legal theory" or facts sufficient to support a cognizable legal theory. See Balistreri v. Pacifica Police Dep't , 901 F.2d 696, 699 (9th Cir. 1990).

In addition, Rule 9(b) requires that the complaint "state with particularity the circumstances constituting fraud." The Ninth Circuit has explained that "[a]verments of fraud must be accompanied by the who, what, when, where, and how' of the misconduct charged." Vess v. Ciba-Geigy Corp. USA , 317 F.3d 1097, 1106 (9th Cir. 2003) (quoting Cooper v. Pickett , 137 F.3d 616, 627 (9th Cir. 1997)).

B. Discussion

1. Fraud-Based Claims

LG alleges that Plaintiff's CLRA, [1] UCL, [2] and FAL[3] claims should be dismissed for failure to meet Rule 9(b)'s heightened pleading requirements because these fraud-based claims were not pled with the requisite specificity. LG relies on the Ninth Circuit's explicit holding that Rule 9(b) applies to CLRA and UCL claims because they are premised on fraud. See Kearns v. Ford Motor Co. , 567 F.3d 1120, 1124 (9th Cir. 2009); see also Vess , 317 F.3d at 1103 (applying Rule 9(b) to pleading of state-law cause of action). By extension, Rule 9(b)'s heightened pleading requirement applies to Plaintiff's FAL claim, ...


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