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In re Ford Tailgate Litigation

United States District Court, N.D. California, San Francisco Division

August 8, 2014

IN RE FORD TAILGATE LITIGATION

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

RICHARD SEEBORG, District Judge.

I. INTRODUCTION

Defendants again move to dismiss the complaint in this putative class action concerning an alleged defect in certain Ford vehicles. This time, defendants seek to dismiss in part and to strike certain elements of the Third Consolidated Amended Class Action Complaint ("TCAC"). For the reasons set forth below, Ford's motion is granted and plaintiffs' Magnuson-Moss Warranty Act ("MMWA") and unjust enrichment claims are dismissed without leave to amend. Plaintiffs' claims for restitution under the California Consumers Legal Remedies Act ("CLRA") similarly are stricken, though their corresponding claims for injunctive relief survive except as to plaintiff Sally Nettleton. Ford's motion to strike the three new named plaintiffs and references to Ford's alleged breach of warranty is denied.

II. BACKGROUND[1]

A detailed summary of the factual allegations and procedural history of this case may be found in the Court's March 12, 2014 Order. In brief, this matter stems from problems occurring with the rear tailgate applique panel of certain Ford sport utility vehicles, which plaintiffs allege is prone to cracking. Plaintiffs allege that Ford has been aware of the defect in the applique since the vehicles were initially manufactured in 2002. Plaintiffs aver that in spite of this knowledge, Ford continued to manufacture, sell, and warrant the defective vehicles. On this basis, plaintiffs allege that Ford has breached its warranted obligations, obtained an unjust enrichment at the expense of consumers, and committed other unfair or deceptive practices.

Plaintiffs further allege that the defective tailgates pose substantial safety risks. According to plaintiffs, a cracked tailgate renders its window portion more likely to break or shatter. In addition, the applique may detach and fly off while a vehicle is in operation. The TCAC includes specific averments from some plaintiffs that the rear windows on their Ford vehicles broke either concurrent with or subsequent to a crack forming in the applique panel. TCAC ¶¶ 191, 218, 226, 256, 263. One plaintiff alleges the shattered glass caused three cuts to his arm. TCAC, ¶ 226. In addition to these safety risks, plaintiffs allege that the defect has resulted in economic damages including repair costs and a reduction in value of the putative class vehicles.

This case represents a consolidation of three separate lawsuits filed in this district: Nettleton v. Ford Motor Co., No. 11-2953; Gettman v. Ford Motor Co., No. 11-3133; and Perrone v. Ford Motor Co., No. 11-3832. After discovery had commenced, plaintiffs filed a Second Consolidated Amended Class Action Complaint ("SCAC"), which Ford moved to dismiss in part. That motion was granted in part. In particular, plaintiffs' state law express and implied warranty claims and other state tort claims were dismissed without leave to amend. In addition, and relevant to this Order, plaintiffs' MMWA, CLRA, and unjust enrichment claims were dismissed with leave to amend.

The TCAC re-alleges an amended claim under the MMWA, as well as amended claims for unjust enrichment, consumer fraud, and other related state-law claims. The TCAC also adds three new named plaintiffs for three states that already have a named plaintiff. TCAC ¶¶ 28, 36, 41. Ford now moves to dismiss the MMWA claim, all of the unjust enrichment claims, and the California plaintiffs' CLRA claims. Ford also moves to strike the three new named plaintiffs and any reference to Ford's alleged breach of warranty.

III. LEGAL STANDARD

To survive a 12(b)(6) motion to dismiss for failure to state a claim, the complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). "Pleadings must be so construed as to do justice." Fed.R.Civ.P. 8(e). While "detailed factual allegations are not required, " a complaint must have sufficient factual allegations to "state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. This determination is a context-specific task requiring the court to "draw on its judicial experience and common sense." Id. at 679.

IV. DISCUSSION

A. Magnuson-Moss Warranty Act Claim

The MMWA provides a federal class action remedy for breach of an implied or express warranty. 15 U.S.C. § 2310(d). The purpose of the MMWA is "to improve the adequacy of information available to consumers, prevent deception, and improve competition in the marketing of consumer products." § 2302(a). The MMWA distinguishes between two types of warranties: full warranties and limited warranties. See § 2303(a). The act establishes minimum federal requirements for full warranties and provides substantive remedies for their breach. § 2304. The act does not establish either minimum requirements or remedies applicable to properly-designated limited warranties, like those at issue in this case, except to provide a federal claim for relief resting on applicable state law claims. Schimmer v. Jaguar Cars, Inc., 384 F.3d 402, 405 (7th Cir. 2004). The primacy of state law in this area is further evidenced by the MMWA's definition of "implied warranties" as those "arising under State law " except as modified by relevant provisions of the act.[2] § 2301(7) (emphasis added). The MMWA does not expand a plaintiff's rights under state law except in those specific circumstances where the federal act explicitly provides a right or remedy. See Walsh v. Ford Motor Co., 807 F.2d 1000, 1012 (D.C. Cir. 1986); Stearns v. Select Comfort Retail Corp., No. 08-2746-JF, 2009 WL 1635931, at *9 (N.D. Cal. June 5, 2009). As a result, claims under the MMWA will generally "stand or fall with [plaintiffs'] express and implied warranty claims under state law. " Clemens v. DaimlerChrysler Corp., 534 F.3d 1017, 1022 (9th Cir. 2008) (emphasis added).

Plaintiffs' express and implied warranty claims were previously dismissed without leave to amend. The Court specifically rejected plaintiffs' latent defect argument based on the general rule "that an express warranty does not cover repairs made after the applicable time or mileage periods have elapsed." Clemens, 534 F.3d at 1023. Plaintiffs' implied warranty claims were rejected because the Uniform Commercial Code, as adopted by each of the plaintiffs' states, permits sellers or manufacturers to limit expressly the duration of any implied warranties, as does the MMWA. Cf. 15 U.S.C. § 2308(b) ("implied warranties may be limited in duration to the duration of a written warranty"). Because plaintiffs' state law warranty claims were not viable, their previous MMWA claim necessarily failed as to both those plaintiffs whose state law warranty claims were dismissed and ...


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