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Zambrano v. Carmax Auto Superstores, LLC

United States District Court, Ninth Circuit

January 21, 2014

TANIA ZAMBRANO, an individual, Plaintiff,
v.
CARMAX AUTO SUPERSTORES, LLC, a Virginia Corporation; CAPITAL ONE, N.A., a business entity of unknown form; SAFECO INSURANCE COMPANY OF AMERICA, a New Hampshire Corporation; and DOES 1 through 75, inclusive, Defendants.

ORDER

WILLIAM Q. HAYES, District Judge.

The matters before the Court are the Motion to Dismiss for Failure to State a Claim pursuant to Federal Rule of Civil Procedure 12(b)(6) (ECF No. 5), and the Motion to Strike Portions of Plaintiff's Complaint pursuant to Federal Rule of Civil Procedure 12(f) (ECF No. 6) filed by Defendants.

I. Background

On July 26, 2013, Plaintiff Tania Zambrano initiated this action against Defendants CarMax Auto Superstores, LLC ("CarMax"), Capital One, N.A. ("Capital One"), and Safeco Insurance Company of America ("Safeco") by filing the Complaint in the Superior Court of California, County of San Diego. On September 10, 2013, Defendants removed the action to this Court. (ECF No. 1).

On September 16, 2013, Defendants filed the Motion to Dismiss for Failure to State a Claim pursuant to Federal Rule of Civil Procedure 12(b)(6) (ECF No. 5), and the Motion to Strike Portions of Plaintiff's Complaint pursuant to Federal Rule of Civil Procedure 12(f) (ECF No. 6). On October 14, 2013, Plaintiff filed a response in opposition. (ECF No. 10). On October 21, 2013, Defendants filed a reply. (ECF No. 11).

II. Allegations of the Complaint

CarMax makes extensive use of the term "certified" in its sales, promotions, and advertising. (ECF No. 1-2 ¶ 19). CarMax describes the vehicles it sells as "CarMax Quality Certified, " and describes the inspection it performs on vehicles as "CarMax Quality Inspection, " or "CQI." Id. Plaintiff relied on CarMax's representations that its vehicles had undergone a 25-point inspection and were "Certified." Id. ¶ 15.

On March 2, 2012, Plaintiff purchased a 2007 Volkswagon Passat from CarMax. Id. ¶ 16. Plaintiff received a "generic inspection certificate" - the CarMax Certified Quality Inspection ("CQI") Certificate. Id. ¶¶ 17, 22. The CQI Certificate states, "This is to certify that this vehicle has passed the rigorous CarMax Certified Quality Inspection." Id. ¶ 39. It is CarMax's stated corporate policy to provide a CQI Certificate, which is a "generic list of components that were purportedly inspected, without disclosing the results of the inspection." Id. ¶ 22. Further, "it is CarMax's stated corporate policy to hide the CQI Certificate inside the glove-box of the vehicle." Id.

CarMax did not provide Plaintiff with a completed inspection report indicating all components inspected prior to sale, during the sale, or after the sale. Id. ¶ 20.

CarMax "actively suppressed and concealed the results of its vehicle inspection." Id. ¶ 23. "It is CarMax's stated corporate policy that, during the inspection, a CQI/CQI Checklist' is filled out." The Checklist is the authentic record of the certification inspection. "It is CarMax's corporate policy to destroy the CQI/CQI Checklist' in contravention of 13 C.C.R. 2.72.00, 13 C.C.R. 272.02 and CNCDA best practices." Id. ¶ 23. On information and belief, the "CQI/CQI Checklist" for Plaintiff's vehicle was destroyed. Id. ¶ 24. "... CarMax does not provide consumers with any documentation regarding its inspection of a vehicle - it destroys these documents." Id. ¶ 25.

CarMax's CQI certificate "does not memorialize CarMax's CQI/CQI Checklist' because the CQI certificate is a generic form, and includes mechanical systems that were impossible to check or certify because they do not exist on Plaintiff's vehicle ( e.g. Manual (starts with clutch only)', Clutch operation (manual trans)')." Id. ¶ 26.

Plaintiff was damaged by CarMax's conduct in the following ways. First, she "received less than she paid for." Id. ¶ 27. Plaintiff paid for a certified 2007 Volkswagon Passat. "What Plaintiff received was an uncertified 2007 Volkswagon Passat." Second, Plaintiff was damaged because "she suffered opportunity costs due to CarMax's misrepresentations." Id. ¶ 30. Plaintiff relied on CarMax's representations that the vehicle was "Certified, " and these misrepresentations "diverted Plaintiff from finding an authentic Certified' pre-owned vehicle." Id. Third, Plaintiff was damaged by "CarMax's fraudulent concealment of the true condition of the vehicle and its representations regarding the inspection of the vehicle." Id. ¶ 31.

Almost immediately after purchasing the vehicle, Plaintiff experienced problems with the vehicle. First, the air conditioning routinely went out. Id. ¶ 32. By September 2012, the vehicle would not start and was "undrivable." Id. This was the first of six occasions requiring Plaintiff to contact AAA roadside assistance. Id. Plaintiff contacted CarMax, and CarMax told her to take her car to a Volkswagon dealership for repair. Id. The last time that Plaintiff took her vehicle to a Volkswagon dealership, she was told there was "an intermittent charge draining the battery and an alternator." Id. ¶ 33.

On May 30, 2013, Plaintiff went to CarMax in San Diego and spoke with Michael Proctor about the problems with her vehicle. Id. ¶ 34. Proctor stated that the defects were not CarMax's issue because "they weren't pre-existing issues." Id. The Complaint asserts the following causes of action: (1) violation of California's Consumer Legal Remedies Act ("CLRA"), Cal. Civ. Code §§ 1750 et seq., seeking equitable and injunctive relief as to all Defendants except Safeco; (2) violation of the Song-Beverly Consumer Warranty Act, Cal. Civ. Code §§ 1790 et seq. as to all Defendants except Safeco; (3) Fraud and Deceit as to all Defendants except Safeco; (4) violation of California's Unfair Competition Law ("UCL"), Cal. Bus. & Prof. Code §§ 17200 et seq. as to all Defendants except Safeco; (5) violation of Vehicle Code § 11711 as to Defendant Safeco only.

II. Motion to Dismiss

A. Standard of ...


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