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Oushana, v. Lowe's Companies, Inc.

United States District Court, E.D. California

November 2, 2017

NORA OUSHANA, an individual; and SCARLET KARAMIAN, an individual, Plaintiffs,
LOWE'S COMPANIES, INC.,, a North Carolina corporation; LOWE'S HIW, INC., a California corporation; ELECTROLUX NORTH AMERICA, INC., a North Carolina corporation Defendants.


         I. Introduction

         Plaintiffs Nora Oushana and Scarlet Karamian filed a second amended complaint on June 15, 2017. Plaintiffs allege causes of action for (1) general negligence, (2) products liability - negligence, (3) products liability - strict liability, (4) fraud - concealment, and (5) breach of implied warranty of fitness.” Doc. 22 (“SAC”) at 1. Plaintiffs seek “statutory, compensatory, and punitive damages.” SAC at 13. Defendants Lowes and Electrolux move to dismiss the fourth cause of action for fraud and strike the demand for punitive damages.

         For the following reasons, Defendants' motion to dismiss will be granted in part and Defendants' motion to strike will be denied.

         II. Background

         A. Installation of the refrigerator and Plaintiffs' injuries resulting therefrom

         Plaintiff Nora Oushana lives in Turlock, California. SAC at ¶ 7. Plaintiff Oushana's daughter, Sabrina Oushana, purchased a refrigerator for her mother from Defendant Lowe's. SAC at ¶ 8. On August 27, 2014, Plaintiff Scarlet Karamian came to help Plaintiff Oushana empty her old refrigerator and fill the new refrigerator upon its arrival. SAC at ¶ 9. On the same date, two Lowe's employees arrived at Plaintiff's house in the late morning or early afternoon to deliver and install the new refrigerator. SAC at ¶ 10. The installation took roughly twenty minutes. SAC at ¶ 11.

         Plaintiff Karamian left Plaintiff' Oushana's house to purchase lunch for the two. SAC at ¶ 12. While Plaintiff Karamian was out, Plaintiff Oushana heard a noise coming from the kitchen “which she has described [as sounding] similar to a teapot boiling over.” SAC at ¶ 13. Plaintiff Oushana walked into the kitchen, using her walker, slipped on water leaking from the refrigerator, and fell to the floor, hitting her right side. SAC at ¶ 13. After the fall, she could not get back to her feet. SAC at ¶ 13. While on the floor, Plaintiff Oushana observed the refrigerator continue to leak. SAC at ¶ 13.

         Sometime shortly thereafter, Plaintiff Karamian returned to find Plaintiff Oushana on the kitchen floor in a pool of water. SAC at ¶ 14. Plaintiff Karamian was unable to help Plaintiff Oushana back to her feet. SAC at ¶ 14. Plaintiff Karamian instead attempted to move the refrigerator out and unplug it in order to prevent any possible electric shock to Plaintiff Oushana. In trying to do so, Plaintiff Karamian injured her lower back. SAC at ¶ 14. Realizing that she and Plaintiff Oushana needed assistance, Plaintiff Karamian sought help from Plaintiff's Oushana's neighbor, Jacob Evanoff. SAC at ¶¶ 14-15. Mr. Evanoff helped Plaintiff Oushana off of the floor, moved the refrigerator, and tended to Plaintiffs. SAC at ¶ 15.

         On the same date, Plaintiff's daughter reported the fall and the leaking refrigerator to Lowe's. SAC at ¶ 16. Several hours later, Lowe's employees arrived at Plaintiff Oushana's house, took the leaking refrigerator and replaced it with a different refrigerator. SAC at ¶ 16. Plaintiff Oushana indicates that the replacement refrigerator looked like the same model as the leaking refrigerator. SAC at ¶ 16.

         On the day of her fall, Plaintiff Oushana was taken to an urgent care facility in Turlock for treatment. SAC at ¶ 17. In the weeks following her fall, Plaintiff Oushana continued to experience pain and weakness on her right side. SAC at ¶ 19. In fact, approximately one week after her fall, Plaintiff Oushana fell again as a result of weakness in her right leg. SAC at ¶ 19. In the second fall, Plaintiff Oushana further injured her right arm and leg. SAC at ¶ 19. She went to the hospital after her second fall. SAC at ¶ 20. Plaintiff Oushana had a “significant fracture” in her right arm. SAC at ¶ 21. Plaintiff Oushana's arm was casted and she was held at the hospital for one week before being released to a rehabilitation center for three weeks. SAC at ¶ 21. After discharge from the rehabilitation center, Plaintiff Oushana received six weeks of in-home physical therapy. SAC at ¶ 21. “Plaintiff Oushana's right arm is permanently disfigured and disabled from the break.” SAC at ¶ 22.

         Plaintiff Karamian began to suffer back pain after attempting to move the refrigerator and help Plaintiff Oushana from the floor. SAC at ¶ 18. She has sought treatment for that pain. SAC at ¶ 18.

         B. Defendants' prior knowledge regarding defects

         Plaintiffs allege that “Defendants Lowe's and Electrolux … were aware of consumer complaints and lawsuits involving Frigidaire refrigerators” in which it was alleged that the refrigerators leaked. SAC at ¶ 23. Plaintiffs further allege that “Defendants concealed th[o]se facts.” SAC at ¶ 23. Specifically, Plaintiffs allege that, rather than disclose the defect, Defendant Electrolux “made claims that they are a leader in kitchen appliances….” SAC at ¶ 24. Further, Defendants Electrolux and Lowe's “continued to advertise the products as good and effective products.” SAC at ¶ 25. Finally, Defendants “failed to recall the product” even though “it was known to leak.” SAC at ¶ 26.

         III. Discussion

         A. Proper procedural device for challenging a demand for punitive damages.

         Defendants move to dismiss Plaintiffs' fraud claim. Plaintiffs' punitive damages demand is premised upon their fraud claim. Assuming that the Court will grant their motion to dismiss, Defendants ask the Court to strike Plaintiff's demand for punitive damages as “impertinent.” Doc. 27 at 12. Assuming that there is no proper basis for punitive damages, a motion to strike is not the proper vehicle to challenge the sufficiency the demand.

         “The court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. Rule Civ. Proc. 12(f). The Ninth Circuit has stated that “Rule 12(f) does not authorize district courts to strike claims for damages on the ground that such claims are precluded as a matter of law.” Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 974-75 (9th Cir. 2010). Rule 12(f) may not be used to strike a request for punitive damages. See, e.g. Estate of Prasad ex rel. Prasad v. County of Sutter, 958 F.Supp.2d 1101, 1128 (E.D. Cal. 2013), Bakersfield Pipe & Supply, Inc. v. Cornerstone Valve, LLC, 2015 U.S. Dist. LEXIS 96331, *5, 2015 WL 4496349 (E.D. Cal. July 23, 2015). The proper vehicle for challenging the sufficiency of a punitive damages claim is a motion to dismiss under Rule 12(b)(6). However, “where a motion is in substance a Rule 12(b)(6) motion, but is incorrectly denominated as a Rule 12(f) motion, a court may convert the improperly designated Rule 12(f) motion into a Rule 12(b)(6) motion.” Consumer Solutions Reo, LLC v. Hillery, 658 F.Supp.2d 1002, 1020-21 (N.D. Cal. 2009). The motion to strike punitive damages will be considered as though it was properly brought as a motion to dismiss for failure to state a claim upon which relief can be granted.

         B. Legal standard for a motion to dismiss for failure to state a claim

         A 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). Where the plaintiff fails to allege “enough facts to state a claim to relief that is plausible on its face, ” the complaint may be dismissed for failure to allege facts sufficient to state a claim upon which relief may be granted. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007); see Fed.R.Civ.P. 12(b)(6). “A claim has facial plausibility, ” and thus survives a motion to dismiss, “when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). On a Rule 12(b)(6) motion to dismiss, the court accepts all material facts alleged in the complaint as true and construes them in the light most favorable to the plaintiff. Knievel v. ESPN, 393 F.3d 1068, 1072 (9th Cir. 2005). However, the court need not accept conclusory allegations, allegations contradicted by exhibits attached to the complaint or matters properly subject to judicial notice, unwarranted deductions of fact or unreasonable inferences. Daniels-Hall v. National Educ. Ass'n, 629 F.3d 992, 998 (9th Cir. 2010).

         C. Plaintiff's Fraud Cause of Action

         Plaintiffs' fourth cause of action alleges that Defendants Lowe's and Electrolux both fraudulently concealed and/or failed to disclose when there was a duty to disclose, that defects existed in the line of Frigidaire brand refrigerators that caused Plaintiffs damages. Defendants contend that Plaintiffs have (1) inadequately identified the allegedly fraudulent conduct attributable to each defendant, instead inappropriately grouping the two together; (2) failed to adequately allege facts to satisfy four of the five elements of their cause of action; and (3) failed to state a claim with particularity as required by Rule 9(b).

         As the court set out in its prior order, “[t]o be liable for fraudulent concealment under California law, (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” Oushana v. Lowe's Home Centers, LLC, 2017 WL 2417198, *4 (E.D. Cal. June 5, 2017) (quoting Alvarez v. MTC Financial, Inc., 2017 WL 1861844, *4 (N.D. Cal. May 9, 2017)); Linear Technology Corp v. Applied Materials, Inc., 152 Cal.App.4th 115, 131 (Cal.Ct.App. 2007). To state a claim for fraudulent omission, a plaintiff need not show purposeful suppression or concealment, however, he or she “must allege the omission of ...

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