United States District Court, C.D. California
HOMESITE INSURANCE COMPANY OF THE MIDWEST; AMERICAN STRATEGIC INSURANCE CORPORATION; MILBANK INSURANCE COMPANY; and MERIDIAN SECURITY INSURANCE COMPANY; on their own behalves and behalf of all other similarly situated insurance companies which underwrite property insurance coverage in the United States, Plaintiffs,
GREE USA, INC.; GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI; HONG KONG GREE ELECTRIC APPLIANCES SALES, LTD.; and MJC, AMERICA, LTD., Defendants.
ORDER DENYING DEFENDANTS' MOTION TO DISMISS
D. Wright, II, United States District Judge
the Court is Defendants Gree USA, Inc., Gree Electric
Appliances, Inc. of Zhuhai, and Hong Kong Gree Electric
Appliance Sales, Ltd.'s (collectively for purposes of
this Order, “Defendants”) Motion to Dismiss
pursuant to Federal Rules of Civil Procedure 12(b)(1) and
12(b)(6). (ECF No. 34.) For the reasons discussed below, the
Court DENIES Defendants'
case is a putative class action brought by Plaintiffs
Homesite Insurance Company of the Midwest, American Strategic
Insurance Corporation, Meridian Security Insurance Company,
and Milbank Insurance Company (collectively,
“Plaintiffs”), on their own behalves and on
behalf of all other similarly situated insurance companies
which underwrite property insurance coverage in the United
States. Plaintiffs allege that Defendants all played various
roles in manufacturing and distributing defective
dehumidifiers that caused house fires throughout the United
States. (First Am. Compl. (“FAC”) ¶¶
36-55, ECF No. 30.) Plaintiffs allege that those
dehumidifiers were recalled on September 12, 2013, as serious
fire hazards.(Id. ¶ 70.)
state that insured victims of the dehumidifier fires filed
claims related to the fires after suffering property damage.
(Id. ¶¶ 92, 101, 110, 119, 128, 137.)
Plaintiffs allege that because they incurred adjustment and
claim expenses which they would not otherwise have incurred
as a result of the fires, they are subrogated to the claims
of their insureds and are entitled to recover damages from
Defendants. (See Id. ¶¶ 93-94, 102-104,
111-113, 120-122, 129-131, 138-140.) Plaintiffs assert causes
of action for declaratory relief, negligence, violation of
CLRA, California Civil Code §§ 1750 et
seq., violation of California Business and Professional
Code §§ 17200 et seq., and strict
product liability. (See FAC.)
base their Motion to Dismiss on two separate grounds: first,
that Plaintiffs do not have standing to assert their causes
of action on their own behalves or behalf of unnamed
plaintiffs; and second, that Plaintiffs' various causes
of action do not state cognizable claims upon which relief
can be granted. (See generally Mot.)
Rule 12(b)(1) allows a party to raise the defense of subject
matter jurisdiction in a Motion to Dismiss. “[T]hose
who seek to invoke the jurisdiction of the federal courts
must satisfy the threshhold requirement imposed by Article
III of the Constitution by alleging an actual case or
controversy.” City of Los Angeles v. Lyons,
461 U.S. 95, 101 (1983). Article III restricts the federal
“judicial power” to the resolution of
“Cases” and “Controversies, ” and
this case-or-controversy requirement is met where the
plaintiff has standing to bring his or her suit. Lujan v.
Defenders of Wildlife, 504 U.S. 555, 559-60 (1992);
see also Cetacean Cmty. v. Bush, 386 F.3d 1169, 1174
(9th Cir. 2004). To satisfy Article III standing, a plaintiff
must show that (1) he has suffered an “injury in
fact” that is concrete and particularized and actual or
imminent, not conjectural or hypothetical; (2) the injury is
fairly traceable to the challenged actions of the defendant;
and (3) it is likely, as opposed to merely speculative, that
the injury will be redressed by a favorable decision.
Bernhardt v. Cnty. of L.A., 279 F.3d 862, 868-69
(9th Cir. 2002) (citing Friends of the Earth, Inc. v.
Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180-81
(2000)). If a plaintiff fails to show that he has standing,
his case should be dismissed. See Lyons, 461 U.S. at
addition, a court may dismiss a complaint pursuant to Federal
Rule of Civil Procedure 12(b)(6) for lack of a cognizable
legal theory or insufficient facts pleaded to support an
otherwise cognizable legal theory. Balistreri v. Pacifica
Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). To
survive a motion to dismiss, a complaint need only satisfy
the minimal notice pleading requirements of Rule 8(a)(2)-a
short and plain statement of the claim. Porter v.
Jones, 319 F.3d 483, 494 (9th Cir. 2003). The factual
“allegations must be enough to raise a right to relief
above the speculative level.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). That is, the
complaint must “contain sufficient factual matter,
accepted as true, to state a claim to relief that is
plausible on its face.” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009).
determination whether a complaint satisfies the plausibility
standard is a “context-specific task that requires the
reviewing court to draw on its judicial experience and common
sense.” Id. at 679. A court is generally
limited to the pleadings and must construe all “factual
allegations set forth in the complaint . . . as true and . .
. in the light most favorable” to the plaintiff.
Lee v. City of L.A., 250 F.3d 668, 688 (9th Cir.
2001). But a court need not blindly accept conclusory
allegations, unwarranted deductions of fact, and unreasonable
inferences. Sprewell v. Golden State Warriors, 266
F.3d 979, 988 (9th Cir. 2001).
Court finds that Defendants' arguments fail under both
Rules 12(b)(1) and 12(b)(6).