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Dickert v. Sanyo Energy (U.S.A.) Corporation

United States District Court, N.D. California

July 23, 2019

MYRA DICKERT, et al., Plaintiffs,
v.
SANYO ENERGY U.S.A. CORPORATION, et al., Defendants.

          ORDER GRANTING DEFENDANTS' MOTION TO DISMISS DOCKET NO. 38

          EDWARD M CHEN UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         Plaintiffs Myra Dickert and Howard Dickert (“Plaintiffs”) bring suit against Sanyo Energy (U.S.A) Corporation (“Sanyo Energy”), Sanyo North America Corporation (“Sanyo NA”), and Panasonic Corporation of North America (“Panasonic, ” and collectively “Defendants”) in connection with allegedly defective solar panels manufactured and marketed by Sanyo Energy. Plaintiffs assert claims for breach of express warranty, breach of contract, unjust enrichment, violation of the California Unfair Competition Law, violation of the New Jersey Consumer Fraud Act, and violation of California Consumer Legal Remedies Act (“CLRA”).

         The Court heard arguments on Defendants' motion to dismiss the First Amended Complaint (“FAC”) on March 7, 2019. Docket No. 38 (“Mot.”). At the hearing, it became apparent that ambiguity remained as to whether the Court could exercise personal jurisdiction over Panasonic. See Docket No. 48 (“Tr.”) at 56-69. The Court accordingly ordered the parties to engage in limited jurisdictional discovery. Docket No. 45. Following discovery, the parties submitted supplemental briefing addressing Panasonic's contacts with the state of California. See Docket No. 60 (“Pl. Supp. Br.”); Docket No. 62 (“Def. Supp. Br.”). For the reasons discussed below, the Court finds that it lacks personal jurisdiction over Panasonic and therefore GRANTS Defendants' motion to dismiss.

         II. FACTUAL AND PROCEDURAL BACKGROUND

         A. First Amended Complaint

         Plaintiffs allege the following in the FAC. Plaintiffs were interested in purchasing solar panels for their home to “reduce their electric bills, save money, and benefit the environment.” FAC ¶ 81. A representative of GeoGenix, an installer of Sanyo panels, assured them the panels “were the best solar panels available on the market, ” would have “30 years useful life, ” and “would all but eliminate their electricity bill for 30 years.” Id. ¶¶ 64, 82, 92. Sanyo provides installers, including GeoGenix, with a specification (or “spec”) sheet stating that the panels come with a 20-year power output limited warranty and a 2-year warranty for workmanship. Id. ¶ 63. Based on this spec sheet, GeoGenix told Plaintiffs that Sanyo provides a 20-year power output warranty. Id. ¶ 65. However, Sanyo did not provide GeoGenix with Sanyo's full, written Limited Warranty at any point; Plaintiffs did not see the Limited Warranty until after this lawsuit was initiated. Id. ¶¶ 60, 63; see FAC, Exh. A (Limited Warranty).

         Plaintiffs relied on GeoGenix's representations about the quality of Sanyo's solar panels and the terms of Sanyo's warranties when they purchased a Sanyo solar panel system from GeoGenix in September 2005. FAC ¶¶ 95-96. They agreed to pay extra for what they believed to be a “premium” product. Id. ¶¶ 82-83. GeoGenix installed the Sanyo solar panels. Id. ¶¶ 91-94.

         “In or about 2016, ” Power Overhaul, a solar energy contractor engaged by Plaintiffs, conducted an inspection of Plaintiffs solar panels. Id. ¶¶ 47, 97. Power Overhaul informed Plaintiffs that “some of their Sanyo panels were not functioning properly” and “the power production of the panels . . . were below the levels stated in the Power Warranty.” Id. ¶ 97. The failed Sanyo panels were a result of “delamination.” Id. ¶ 98. Delamination occurs when the laminated components of a solar panel detach because the bond between the plastics and the glass separates. Id. ¶ 42. This detachment allows air and moisture to come in to contact with the wires that conduct electricity, creating a safety and fire risk. Id. ¶ 51.

         Plaintiffs submitted a warranty claim to Sanyo through GeoGenix. Id. ¶ 100. Sanyo took approximately eighteen months to respond to the claim, and only agreed to replace nine of the thirteen delaminated panels. Id. ¶ 101. Sanyo explained the remaining four panels would not be replaced because Plaintiffs provided insufficient test data of power degradation to qualify for replacement panels. Id. Sanyo refused to conduct the necessary power output tests and required the Plaintiffs to obtain the test data and provide it to Sanyo. Id. ¶ 103. Plaintiffs allege that Sanyo put the onus on consumers to conduct power output tests on defective panels as part of a warranty “claims suppression strategy.” Id.

         Throughout the eighteen-month period when Sanyo was processing Plaintiffs' warranty claim, Power Overhaul provided additional photographs to Sanyo demonstrating “delamination throughout many of Plaintiff's panels.” Id. ¶ 105. Although the FAC does not make it clear, it appears that this delamination manifested in panels other than the initial thirteen that Plaintiffs reported as defective. It also appears that Sanyo did not address these additional delaminated panels when it responded to Plaintiffs' warranty claim.

         On July 18, 2018, Plaintiffs sent a letter to Sanyo pursuant to the CLRA informing Sanyo of an alleged violation of California Civil Code § 1770 as well as an alleged breach of warranty. FAC, Exh. D. In the letter, Plaintiffs demanded that Sanyo fix the panel defects within thirty days of receipt of the letter. Id. Plaintiffs then filed this suit on August 2, 2018, fifteen days after sending the letter. See Docket No. 1. Defendants moved to dismiss the original complaint. Docket No. 30. Instead of litigating the motion, the parties stipulated that Plaintiffs would file an amended complaint. Docket No. 36. The instant motion to dismiss the FAC followed.

         B. Jurisdictional Discovery

         At the hearing on March 7, 2019, counsel for Defendants argued that to the extent Plaintiffs' claims hinged on conduct attributable to Panasonic, rather than Sanyo, Plaintiffs had failed to identify any “California-related activity” by Panasonic that would allow the Court to exercise personal jurisdiction over it. Tr. 56:9-17. Since Sanyo NA-a Delaware corporation whose principal place of business was San Diego, California-ceased to exist in 2015 when it was merged into Panasonic, any acts of alleged warranty suppression after 2015 would ...


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