United States District Court, S.D. California
(1) GRANTING DEFENDANTS' MOTION TO DISMISS [DOC. 19]; AND (2) DENYING AS MOOT
DEFENDANTS' MOTION TO STRIKE [DOC. 20]
THOMAS J. WHELAN, District Judge.
On September 20, 2012, Plaintiffs Petra Villalobos and John A. Villalobos commenced this action against Defendant CarMax Auto Superstore California, LLC ("CarMax") in the San Diego Superior Court. Thereafter, Defendant timely removed the action to this Court. Defendant now move to dismiss the First Amended Complaint ("FAC"), or in the alternative, strike portions of the FAC. Plaintiffs opposes.
The Court decides the matter on the papers submitted and without oral argument. See Civ. L.R. 7.1(d.1). For the following reasons, the Court GRANTS WITH LEAVE TO AMEND Defendant's motion to dismiss, and DENIES AS MOOT Defendant's motion to strike.
On December 10, 2011, Plaintiffs purchased a 2006 Chrysler Pacifica from Defendant. (FAC ¶ 6; see also FAC Ex. 1.) According to Plaintiffs, Defendant "did not provide Plaintiffs with a completed inspection report prior to sale, " but rather provided "a generic CQI CarMax Certified Qualified Inspection document that does not itemize any items in the specific vehicle that were inspected or repaired." ( Id. ¶¶ 6, 14-15 (internal quotation marks omitted); see also FAC Ex. 2.) Plaintiffs allege that the Certified Quality Inspection ("CQI") certificate did not memorialize Defendant's "CQI/VQI Checklist" because the certificate was a generic form that "include[d] mechanical systems that were impossible to check or to certify because they do not exist on Plaintiffs' vehicle." ( Id. ¶ 20.) The certification inspection form was eventually given to Plaintiffs "in a stack of documents after they signed the purchase documents." (Id.; see also FAC Ex. 2.)
As a part of the transaction, Plaintiffs traded in a 2006 Ford F-150 for a trade-in value of $9, 000. (FAC ¶ 7.) "The trade-in vehicle had an outstanding lien balance of $8, 482.27, creating positive equity of $517.73." (Id.) Plaintiffs allege that they "elected to apply $190.74 to the downpayment on the [Chrysler] and received cash back from CarMax for the remaining positive equity on their trade-in, in the amount of $326.99." (Id.) However, on the Retail Installment Contract ("RIC"), Defendant listed the Ford's value as $8, 482.27. ( Id. ¶ 9.) Plaintiffs allege that Defendant failed to give them the agreed-upon value of their trade-in and the cash difference. (Id.)
Lastly, Plaintiffs add that the Chrysler has "suffered from on-going mechanical defects wince Plaintiffs purchased it." (FAC ¶ 10.)
On September 20, 2012, Plaintiffs commenced this action in the San Diego Superior Court. This action was later timely removed. Thereafter, Plaintiffs filed their FAC asserting claims for: (1) violation of the California Consumer Legal Remedies Act ("CLRA"), Cal. Civ. Code § 1750, et seq.; and (2) violation of the California Business and Professions Code, Cal. Bus. & Prof. Code § 17200, et seq., which is also known as the California Unfair Competition Law ("UCL"). Plaintiffs contend that Defendant violated numerous subsections of the CLRA and the UCL by: (1) failing to provide a copy of the CQI inspection report pre-purchase; (2) calling the vehicle certified when Defendant "does not oversee, supervise and/or enforce any certification' standards"; (3) failing to provide a thorough 125-point inspection of the vehicle; (4) failing to provide an inspection report at any time that complies with California law; (5) failing to list the agreed-upon value of the trade-in vehicle on the purchase contract; and (6) failing to list the "agreed value" of the trade-in on the contract. (FAC ¶¶ 38, 45.)
Defendants now move to dismiss the FAC in its entirety, or in the alternative, strike portions of the complaint. Plaintiffs oppose.
II. LEGAL STANDARD
The court must dismiss a cause of action for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the complaint. Navarro v. Block , 250 F.3d 729, 732 (9th Cir. 2001). The court must accept all allegations of material fact as true and construe them in light most favorable to the nonmoving party. Cedars-Sanai Med. Ctr. v. Nat'l League of Postmasters of U.S. , 497 F.3d 972, 975 (9th Cir. 2007). Material allegations, even if doubtful in fact, are assumed to be true. Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555 (2007). However, the court need not "necessarily assume the truth of legal conclusions merely because they are cast in the form of factual allegations." Warren v. Fox Family Worldwide, Inc. , 328 F.3d 1136, 1139 (9th Cir. 2003) (internal quotation marks omitted). In fact, the court does not need to accept any legal conclusions as true. Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009).
"While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds' of his entitlement to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly , 550 U.S. at 555 (internal citations omitted). Instead, the allegations in the complaint "must be enough to raise a right to relief above the speculative level." Id . Thus, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Iqbal , 556 U.S. at 678 (citing Twombly , 550 U.S. at 570). "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." Id . "The plausibility standard is not akin to a probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id . A complaint may be dismissed as a matter of law either for lack of a cognizable legal theory or for insufficient facts under a cognizable theory. Robertson v. Dean Witter Reynolds, Inc. , 749 F.2d 530, 534 (9th Cir. 1984).
Generally, courts may not consider material outside the complaint when ruling on a motion to dismiss. Hal Roach Studios, Inc. v. Richard Feiner & Co. , 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). However, documents specifically identified in the complaint whose authenticity is not questioned by parties may also be considered. Fecht v. Price Co. , 70 F.3d 1078, 1080 n.1 (9th Cir. 1995) (superceded by statutes on other grounds). Moreover, the court may consider the full text of those documents, even when the complaint quotes only selected portions. Id . It may also consider material ...