Adams v. Nissan N. Am., Inc.

• Decision Date: 23 May 2018
• Docket Number: CIVIL ACTION NO. 4:17-CV-2653
• Citation: 395 F.Supp.3d 838
• Parties: Ellen ADAMS, et al., Plaintiffs, v. NISSAN NORTH AMERICA, INC., Defendant.
• Court: U.S. District Court — Southern District of Texas

395 F.Supp.3d 838

Ellen ADAMS, et al., Plaintiffs,

v.NISSAN NORTH AMERICA, INC., Defendant.

CIVIL ACTION NO. 4:17-CV-2653

United States District Court, S.D. Texas, Houston Division.

Signed May 23, 2018

ORDER ADOPTING REPORT AND RECOMMENDATION

KEITH P. ELLISON, UNITED STATES DISTRICT JUDGE

Pending before the Court is Defendant's Motion to Dismiss (Doc. No. 15), which was referred to Magistrate Judge Dena Hanovice Palermo for a report and recommendation. On May 4, 2018, Judge Palermo issued the Report and Recommendation on the Motion to Dismiss (Doc. No. 34), recommending that the Motion to Dismiss be granted. The time for filing objections has passed, and no objections were filed.

The Court has reviewed the Report and Recommendation for clear error, as required by Federal Rule of Civil Procedure 72(b), and finds that there is none. Accordingly, the Court ADOPTS the Report and Recommendation in its entirety. Defendant's Motion to Dismiss is hereby GRANTED.

IT IS SO ORDERED.

REPORT AND RECOMMENDATION ON DEFENDANT'S MOTION TO DISMISS

Dena Hanovice Palermo, United States Magistrate Judge

Before the Court is Defendant's Motion to Dismiss Plaintiffs' First Amended Complaint. ¹

ECF No. 15. The parties appeared before the Court on April 20, 2018 to argue their positions on this motion. Having considered the arguments of counsel, the record, and the applicable law, the Court recommends that Defendant's Motion to Dismiss should be granted.

I.BACKGROUND

Three plaintiffs, Ms. Ellen Adams ("Adams"), Ms. Kimberlyn Jones ("Jones"), and Ms. Crystal LeBlanc ("LeBlanc") (collectively "Plaintiffs"), bring this action against Nissan North America, Inc. ("Nissan") on behalf of themselves and all other Texas residents who own, lease, or operate 2008 and 2009 Nissan Altima vehicles ("Class Vehicles"). Pls.' First Am. Compl. at ¶ 1, ECF No. 13. Plaintiffs allege their Class Vehicles have defective dashboards "that do not withstand exposure to sunlight and humidity and ultimately melt and degrade." Id. at ¶ 1. These deteriorating dashboards become reflective, casting glare onto the windshield, and making it difficult to see through the windshield, and thus dangerous to drive. Id. at ¶¶ 2–3.

Plaintiffs Adams and Jones first filed this action on September 1, 2017. Pls.' Compl., ECF No. 1. Nissan filed a Motion to Dismiss on October 19, 2017. Def.'s Mot. Dismiss, ECF No. 5. Plaintiffs filed their First Amended Complaint on November 9, 2017, adding Plaintiff LeBlanc. ECF No. 13. Plaintiffs assert three causes of action: (1) breach of implied warranty of merchantability under TEX. BUS. & COM. CODE § 2.314 ; (2) money had and received and unjust enrichment; and (3) declaratory judgment and injunctive relief under 28 U.S.C. § 2201. Defendant again filed a Motion to Dismiss on November 30, 2017, which is now pending before this Court. ECF No. 15. Defendant makes three main arguments: (1) Plaintiffs' claims are time-barred and fraudulent concealment tolling does not apply; (2) Plaintiffs fail to state a claim for which relief can be granted; and (3) Plaintiffs' claim for declaratory and injunctive relief is barred because there is no "actual controversy" and it is derivative of the other causes of action.

II.LEGAL STANDARD

A court may dismiss a complaint for "failure to state a claim upon which relief can be granted." FED. R. CIV. P. 12(b)(6). "Motions to dismiss under Rule 12(b)(6) are viewed with disfavor and are rarely granted." Lormand v. U.S. Unwired, Inc. , 565 F.3d 228, 232 (5th Cir. 2009) (citation omitted); Duke Energy Int'l v. Napoli , 748 F. Supp. 2d 656, 664–65 (S.D. Tex. 2010). "Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a ‘short and plain statement of the claim showing that the pleader is entitled to relief.’ " Ashcroft v. Iqbal , 556 U.S. 662, 677–78, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). The complaint must include more than mere "labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotation marks and citations omitted). A complaint must "contain sufficient factual matter ... to ‘state a claim to relief that is plausible on its face.’ " Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (quoting Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ). A claim is plausible "when the pleaded factual contents allow the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Bowlby v. City of Aberdeen, Miss. , 681 F.3d 215, 219 (5th Cir. 2012). "[A] complaint ‘does not need detailed factual allegations,’ but must provide the plaintiff's grounds for entitlement to relief—including factual allegations that when assumed to be true ‘raise a right to relief above the speculative level.’ " Cuvillier v. Taylor , 503 F.3d 397, 401 (5th Cir. 2007) (quoting Twombly , 550 U.S. at 555, 127 S.Ct. 1955 ).

The ultimate question "is whether the complaint states a valid claim when viewed in the light most favorable to the plaintiff." Brown v. Bd. of Trustees Sealy Indep. Sch. Dist. , 871 F. Supp. 2d 581, 590 (S.D. Tex. 2012). "[I]n considering a motion to dismiss under Rule 12(b)(6), a complaint must be liberally construed in favor of the plaintiff and all well-pleaded facts taken as true." Duke Energy Int'l , 748 F. Supp. 2d at 665. "[C]ourts are required to dismiss, pursuant to [ Rule 12(b)(6) ], claims based on invalid legal theories, even though they may be otherwise well-pleaded." Farshchi v. Wells Fargo Bank, N.A. , No. H-15-1692, 2016 WL 2858903, at *2 (S.D. Tex. May 13, 2016) (citing Flynn v. State Farm Fire and Cas. Ins. Co. , 605 F. Supp. 2d 811, 820 (W.D. Tex. 2009) ).

III.ANALYSIS

A. Plaintiffs' Claims Are Time Barred.

Defendant contends that Plaintiffs' claims for breach of implied warranty of merchantability, money had and received, and unjust enrichment are time-barred. ECF No. 15 at 7–10. Defendant further alleges neither the discovery rule nor fraudulent concealment toll the limitations period. Id. at 8–13. Plaintiffs respond that Nissan's fraudulent concealment of the defect tolled their limitations period.² ECF No. 23 at 7.

1. The statute of limitations for claims of implied warranty of merchantability.

Both parties agree that the limitations period for a claim for breach of implied warranty of merchantability is four years. ECF No. 15 at 7; ECF No. 23 at 7; see TEX. BUS. & COM. CODE § 2.725(a) ; Morris v. Cessna Aircraft Co. , 833 F. Supp. 2d 622, 643 (N.D. Tex. 2011). Breach of warranty claims accrue at the time of delivery or sale, "regardless of the aggrieved party's lack of knowledge of the breach." TEX. BUS. & COM. CODE § 2.725(b) ; MAN Eng. & Components, Inc. v. Shows , 434 S.W.3d 132, 140 (Tex. 2014) ; see also Safeway Stores, Inc. v. Certainteed Corp. , 710 S.W.2d 544, 546 (Tex. 1986).

Adams' "2008 Nissan Altima was purchased new by her father from Champion Nissan" in 2008. ECF No. 13 at ¶ 73. "At the time of purchase, he gave it to her to use as her primary vehicle." Id. "Jones purchased her new 2009 Nissan Altima from Conroe Nissan in Conroe, Texas," though she does not specify when she purchased her vehicle. Id. at ¶ 81. A new 2009 model would have been purchased in 2008 or 2009. ECF No. 15 at 8. LeBlanc "leased her 2008 Nissan Altima from Honda of Katy in Katy, Texas", but does not specify whether she leased a new vehicle in 2007 or 2008, or a pre-owned vehicle at a later date. ECF No. 13 at ¶ 86. Plaintiff Adams' implied warranty claim would have accrued in 2008, and her four year limitations period expired in 2012. ECF No. 15 at 8. Plaintiff Jones' implied warranty claim would have accrued at the latest in 2009, and her four-year limitations period expired in 2013. Id. Plaintiff LeBlanc's implied warranty claim would have accrued no later than 2008, and the limitations period expired by 2012. Id.

Plaintiffs do not dispute when their implied warranty claims accrued; they only argue that fraudulent concealment tolled their claims. ECF No. 13 at ¶¶ 116–131; ECF No. 23 at 7. The parties agree that Plaintiffs' implied warranty claims are time barred unless fraudulent concealment tolling applies. See Apr. 20, 2018 Oral Argument at 11:04–11:05, 11:46.

2. The statute of limitations for claims for money had and received, and unjust enrichment.

Plaintiffs contend that the limitations period for a claim for money had and received is four years while Defendant claims it is two years.³ This Court need not decide which period applies to a claim for money had and received because the parties agree that, regardless of whether the limitations period is two or four years, Plaintiffs' equitable claims are time-barred unless tolling applies. See Apr. 20, 2018 Oral Argument at 11:12–11:13, 11:46. The limitations period for unjust enrichment is two years.⁴ TEX. CIV. PRAC. & REM. CODE § 16.003 ; Elledge v. Friberg–Cooper Water Supply Corp. , 240 S.W.3d 869, 871 (Tex. 2007) (per curiam). Claims for money had and received and unjust enrichment begin to accrue "when the money is paid." Tornado Bus Co. v. Bus & Coach Am. Corp. , No. 3:14-CV-3231-M, 2015 WL 5164731, at *6 (N.D. Tex. Sept. 2, 2015) ; see also Mayo v. Hartford , 354 F.3d 400, 410–11 (5th Cir. 2004).

3. Plaintiffs fail to state sufficient facts to support a reasonable inference that fraudulent concealment tolled their claims.

Plaintiffs must plead sufficient facts supporting a reasonable inference that fraudulent concealment tolled their claims. The elements of fraudulent concealment are: "(1) actual knowledge of the wrong, (2) a duty to disclose the wrong, and (3) a fixed purpose to conceal the wrong." Ultraflo Corp. v. Pelican Tank Parts, Inc. , 926 F. Supp. 2d 935, 950 (S.D. Tex. 2013) ; see also Garcia v. Chrysler Group, LLC , 127 F. Supp. 3d 212, 234–35 (S.D.N.Y. 2015) (applying Texas law) ; Vernon v. City of Dallas , No. 3:08-CV-1068-B, 2009 WL 2486033, at *5 (N.D. Tex. Aug. 13, 2009)....