Dinwiddie v. Suzuki Motor of Am., Inc.

• Decision Date: 27 May 2015
• Docket Number: No. CIV–14–1127–W.,CIV–14–1127–W.
• Citation: 111 F.Supp.3d 1202
• Parties: Jason DINWIDDIE, individually and on behalf of all others similarly situated, Plaintiff, v. SUZUKI MOTOR OF AMERICA, INC., Defendant.
• Court: U.S. District Court — Western District of Oklahoma

111 F.Supp.3d 1202

Jason DINWIDDIE, individually and on behalf of all others similarly situated, Plaintiff,

v.SUZUKI MOTOR OF AMERICA, INC., Defendant.

No. CIV–14–1127–W.

United States District Court, W.D. Oklahoma.

Signed May 27, 2015.

Blake Sonne, Norman, OK, for Plaintiff.

Michael K. Avery, Patrick L. Stein, Reid E. Robison, McAfee & Taft, Oklahoma City, OK, Michael C. Drew, Thomas A. Casey, Jr., Jones Walker LLP, New Orleans, LA, for Defendant.

ORDER

LEE R. WEST, District Judge.

This matter comes before the Court on the Motion to Dismiss First Amended Class Action Complaint filed by defendant Suzuki Motor of America, Inc. ("Suzuki Motor"). Plaintiff Jason Dinwiddie¹ has responded, and Suzuki Motor has filed a reply. Based upon the record, the Court makes its determination.

To the extent Suzuki Motor has challenged the factual sufficiency of Dinwiddie's allegations in his first amended complaint under Rule 12(b)(6), F.R.Civ.P., the United States Supreme Court has set forth the standards that this Court must use in determining whether those challenges have merit. In Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), the Supreme Court held in accordance with Rule 8, F.R.Civ.P., that a complaint need not contain "heightened fact pleading of specifics," 550 U.S. at 570, 127 S.Ct. 1955, or "detailed factual allegations," id. at 555, 127 S.Ct. 1955 (citations omitted), but that it must contain "enough facts to state a claim to relief that is plausible on its face." Id. at 570, 127 S.Ct. 1955.

The United States Court of Appeals for the Tenth Circuit has stated that Twombly imposes a "burden ... on the plaintiff to frame a ‘[pleading] ... with enough factual matter (taken as true) to suggest’ that he ... is entitled to relief." Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir.2008) (quoting Twombly, 550 U.S. at 556, 127 S.Ct. 1955 ). The allegations in the first amended complaint² must therefore "be enough that, if assumed to be true, ... [Dinwiddie] plausibly (not just speculatively) has a claim for relief [against Suzuki Motor]."Id. (footnote omitted).

The Court's task at this stage is to determine whether "there are well-pleaded factual allegations." Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009), in the challenged pleading; if so, the "[C]ourt should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id.

A claim has facial plausibility when the plaintiff pleads factual content that allows the [C]ourt to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a "probability requirement," but it asks for more than a sheer possibility that a defendant has acted unlawfully. Where a [pleading] ... pleads facts that are "merely consistent with" a defendant's liability, it "stops short of the line between possibility and plausibility of ‘entitlement to relief.’ "

Id. at 678, 129 S.Ct. 1937 (citations omitted).

In this connection, the first amended complaint " ‘must contain either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory.’ " Bryson v. Gonzales, 534 F.3d 1282, 1286 (10th Cir.2008) (quotation and further citation omitted). While "[t]he nature and specificity of the allegations required to state a plausible claim will vary based on context," Kansas Penn Gaming, LLC v. Collins, 656 F.3d 1210, 1215 (10th Cir.2011) (citations omitted), neither " ‘naked assertion[s]’ devoid of ‘further factual enhancement,’ " Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 557, 127 S.Ct. 1955 ), nor "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory allegations, ... suffice." Id. (citing Twombly, 550 U.S. at 555, 127 S.Ct. 1955 ). "[T]he Twombly/Iqbal standard recognizes a plaintiff should have at least some relevant information to make the claims plausible on their face." Khalik v. United Air Lines, 671 F.3d 1188, 1193 (10th Cir.2012).

"[I]t demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation," Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 555, 127 S.Ct. 1955 (further citation omitted)), and more than "mere ‘labels and conclusions,’ and ‘a formulaic recitation of the elements of a cause of action’...." Kansas Penn Gaming, 656 F.3d at 1214 (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955 ). If the plaintiff's factual allegations "are ‘merely consistent with’ a defendant's liability," Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (quotation omitted), or "do not permit the [C]ourt to infer more than the mere possibility of misconduct," id. at 679, 129 S.Ct. 1937, the plaintiff "has not ‘show[n]’... ‘that ... [he] is entitled to relief.’ " Id. (quotation omitted).

On October 31, 2012, defendant Suzuki Motor incorporated under the laws of the State of California as a wholly-owned subsidiary of Suzuki Motor Corporation ("SMC") "for purposes of ... transactions contemplated [between Suzuki Motor and American Suzuki Motor Corporation ("ASMC") ] under ... [an asset purchase agreement]." Doc. 21–3 at 16, ¶ 32. Shortly thereafter, on November 5, 2012, ASMC filed a voluntary petition seeking relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Central District of California. In re American Suzuki Motor Corporation, Case 8:12–bk22808–SC (Bankr.C.D.Cal.). On March 6, 2013, Suzuki Motor and ASMC entered into the Second Amended and Restated Asset Purchase Agreement ("APA"), see Doc. 21–1, which the Bankruptcy Court found was negotiated "without collusion, in good faith, and from arm's length bargaining positions." Doc. 21–3 at 19, ¶ 39.³

The APA recognized that ASMC had been "engaged in three distinct business lines ...," Doc. 21–1 at 7, ¶ B, only two of which are relevant to this action. The first was "the ‘Auto Sales Business,’ " Id. at 7, ¶ B(i)(emphasis deleted), which was comprised of "the distribution and sale of Suzuki Automotive Products[.]" Id. The phrase "Suzuki Automotive Products" was defined in the APA as "Suzuki Automotives and automotive parts and other related products manufactured by or for SMC...." Id. at 53, ¶ 16.

The second business line—"the ‘Auto Servicing Business," Id. at 7, ¶ B(ii)(emphasis deleted), concerned "the servicing of Suzuki Automotives, including any warranty work...." Id. The APA described the Auto Sales Business and the Auto Servicing Business collectively "as the ‘Auto Business," Id. (emphasis deleted); only the latter—the Auto Servicing Business—however, was "referred [to] as ‘Acquired Business,’ " Id., and the Bankruptcy Court specifically noted that Suzuki Motor was "not acquiring ... [ASMC's] Auto Sales Business...." Id. at 20, 43.

Pursuant to the APA and the transactions contemplated therein, see id. at 7–8, ¶ E, ASMC agreed to sell, assign and transfer and Suzuki Motor agreed to purchase, acquire and accept, inter alia, all of ASMC's right, title and interest to and in "the Acquired Business, other than any Excluded Assets," id. at 8, ¶ 1.1.1, described as "the ‘Purchased Assets.’ " Id. Included in the Purchased Assets were "all Claims relating to any of the Purchased Assets, the Assumed Liabilities or the Acquired Business[.]" Id. at 9, ¶ 1.1.1(m). Included in the term "Excluded Assets" were those "assets ... arising out of, relating to, or used in connection with the operation of the Auto Business, including Suzuki Automotives...." Id. at 10, ¶ 1.2(a).

The liabilities that Suzuki Motor assumed through the APA were limited to those "[l]iabilities relating to the ownership of the Purchased Assets or the Acquired Business ...," id. at 15, ¶ 2.5(i), and "all Suzuki Product Liability." Id. ¶ 2.5(ii). The latter phrase was defined as "any [l]iability of ... [ASMC], regardless of whether arising ... (i) under [e]xpress [w]arranty [c]laims on any Suzuki Products[, including ‘any Suzuki Automotive Products']; (ii) for recall and other obligations under the [National Traffic and Motor Vehicle Safety Act ("NTMVSA"), 49 U.S.C. § 301 et seq., ] ... with respect to Suzuki Products; or (iii) under any Lemon Laws with respect to Suzuki Products." Doc. 21–1 at 53, ¶ 16. Accordingly, the APA obligated Suzuki Motor to notify consumers about recalls conducted pursuant to NTMVSA and under the supervision of the National Highway Traffic Safety Administration ("NHTSA"),⁴ an agency of the Department of Transportation.

Dinwiddie had purchased a 2007 Suzuki Forenza that had been "manufactured, marketed, distributed, and/or sold," Doc. 17 at 6, ¶ 15, by ASMC, and he "received a copy of [a] ... Recall Notice ... in mid to late July 2014." Id. at 12, ¶ 31. It was during that time that Suzuki Motor had begun notifying consumers in accordance with NTMVSA that " ‘certain 2004–2008 Suzuki Forenza ... vehicles,’ " id. at 10, ¶ 25, were being recalled because "a defect which relate[d] to motor vehicle safety exist[ed] in ... [those] vehicles." Id. The Recall Notice identified a list of " ‘symptoms' ... including abnormal headlamp operation, abnormal daytime running lamp operation, unusual odors of heated plastic or wiring insulation, and intermittent vehicle battery discharge."Id.

The Recall Notice further advised:

"Affected vehicles may generate heat in the Headlamp Switch or DRL Module, located on or near the left side of the steering column, which could melt the switch or module. If the heat generated within the Headlamp Switch or DRL Module melts the component, there is an increased risk of fire. You do not need to stop driving your vehicle, however if local driving rules or driving conditions require the use of your headlamps or DRL lighting, Suzuki [Motor] cannot recommend you operate the vehicle if the lighting is not operating as designed. If you smell unusual odors associated with possible overheated plastic or wire insulation while

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