Grover v. BMW of N. Am., LLC

Decision Date21 January 2020
Docket NumberCase No. 1:19-cv-0012
Parties Gary GROVER, et al., Plaintiffs, v. BMW OF NORTH AMERICA, LLC, Defendant.
CourtU.S. District Court — Northern District of Ohio

Sergei Lemberg, Lemberg Law, Wilton, CT, for Plaintiffs.

John R. McInerney, Timothy V. Hoffman, Sanchez Daniels & Hoffman, Chicago, IL, for Defendant.



This matter is before the Court on defendant's motion to dismiss or sever. (Doc. No. 17, Motion ["Mot."].) Plaintiffs filed an opposition brief (Doc. No. 19, Opposition ["Opp'n"] ) and defendant replied. (Doc. No. 20, Reply ["Reply"].) The motion is now ripe for a decision. Defendant has requested oral argument. Finding that the issues have been fully briefed and that oral argument would not assist the Court, the request is denied.


The following facts are drawn from plaintiffs’ amended complaint, they are accepted as true for purposes of resolving defendant BMW of North America, LLC's ("BMW") motion to dismiss. Plaintiffs, Gary Grover ("Grover"), Reginald Williams ("Williams"), Dana Walling ("Walling"), Joshua Cribbs ("Cribbs"), Wendy Massey ("Massey"), John Webb ("Webb"), and Parker Jarvis ("Jarvis") (collectively "plaintiffs") are Ohio residents and purchasers of BMW-manufactured automobiles.1 (Doc. No. 13, Amended Complaint ["Am. Compl."] ¶¶ 9–64.) Plaintiffs’ automobiles (the "Vehicles") are all equipped with a twin-turbocharged V8 engine, known as the N63 engine. (Id. ¶¶ 87, 89.) At the time of purchase, BMW made representations as to the Vehicles’ quality, and assured plaintiffs that the Vehicles were free from defects. (Id. ¶ 78.) When making their purchase decisions, plaintiffs relied upon BMW's representations regarding its New Vehicle Limited Warranty (the "Warranty") that accompanied the sale of the vehicles. (Id. ¶ 79.) Under the Warranty—which was fully transferable to subsequent purchasers—BMW promised to repair or replace defective components for four years or 50,000 miles from the initial date of purchase. (Id. ¶ 80.)

Soon after making their respective purchases, plaintiffs observed that the Vehicles consumed an excessive amount of engine oil, which required them to add additional quarts of oil throughout the warranty period and before BMW's recommended oil change intervals. (Id. ¶¶ 12, 20, 28, 39, 47, 55, 65.) Plaintiffs brought the oil-consumption issue to the attention of authorized BMW dealerships but were told that excess oil consumption was normal. (Id. ¶¶ 13, 14, 21, 22, 29, 30, 40, 41, 56, 57, 66, 67.) Plaintiffs later discovered that the N63 engine contained a manufacturing defect which caused it to consume engine oil at an abnormally rapid pace. (Id. ¶ 85.)

The defect has become so widely known that BMW has issued several technical service bulletins ("TSB") to address complaints related to excessive oil consumption. (Id. ¶ 101.) Instead of addressing the underlying cause of the oil consumption, BMW simply instructed its service technicians to add two quarts of engine oil to N63 vehicles—when the cars’ electronic systems only called for one additional quart—while claiming that "additional engine oil consumption ... is normal and not a defect." (Id. ¶¶ 103–05.) After receiving hundreds of complaints, BMW launched several programs to address the oil-consumption problem, including the "N63 Customer Care Package" which reduced the recommended oil change intervals from the earlier of 15,000 miles or two years, to the earlier of 10,000 miles or one year. (Id. ¶¶ 110–12.) Additionally, BMW authorized dealerships to provide disgruntled N63 purchasers with up to $50 in BMW merchandise. (Id. ¶¶ 110, 114.)

BMW learned of the oil-consumption defect in 2008 through, inter alia , pre-release testing, durability testing, and aggregate data from BMW dealers. (Id. ¶ 118.) BMW failed to disclose the defect even though customers’ safety was jeopardized. (Id. ¶¶ 119–20.) Plaintiffs could not have reasonably discovered the defect prior to acceptance of the Vehicles and would not have purchased the Vehicles had they known of the oil-consumption defect. (Id. ¶¶ 124, 125.)

Plaintiffs’ amended complaint alleges: (1) breach of warranty pursuant to the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301, et seq. (the "Warranty Act"); (2) breach of implied warranty of merchantability pursuant to the Warranty Act and Ohio Rev. Code § 1302.27 ; (3) breach of express warranty under Ohio Rev. Code § 1302.26 ; and (4) violation of the Ohio Consumer Sales Practices Act ("CSPA") Ohio Rev. Code § 1345.01, et seq . (See Id. ¶¶ 142–86.)

Plaintiffs seek revocation of acceptance of the Vehicles and money damages in the form of a refund of the full contract price. In the alternative, plaintiffs seek "replacement of the subject vehicles with new vehicles, or repair of the defective subject vehicles with an extension of the express and implied warranties...." (Id. at 152.2 ) Finally, plaintiffs seek incidental and consequential damages, treble and punitive damages, and reasonable attorney's fees. (Id. )

BMW filed the current motion to dismiss or sever on April 22, 2019. (See Mot.)3 BMW asks this Court to sever the seven plaintiffs, arguing that they are misjoined under Fed. R. Civ. P. 20(a). (Doc. No. 18, Memorandum in Support of Motion to Dismiss ["Memo"] at 262–67.) BMW asserts that, once severed, no individual plaintiff will meet the amount-in-controversy threshold required under the Warranty Act and, therefore, the claims should be dismissed for lack of subject matter jurisdiction.4 (Memo at 259.)

A. Motion to Sever

BMW requests that this Court sever the seven "plaintiffscases as misjoined in contravention of Federal Rules of Civil Procedure Rules 20 and 21...." (Mot. at 250.) Under Rule 20, persons may join in the same action if "(A) they assert any right to relief jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences; and (B) any question of law or fact common to all plaintiffs will arise in the action." Fed. R. Civ. P. 20(a)(1).

"Joinder is generally favored under the federal rules." Scott v. Fairbanks Capital Corp. , 284 F. Supp. 2d 880, 887 (S.D. Ohio 2003). Joinder "promote[s] trial convenience and expedite[s] the final determination of disputes, thereby preventing multiple lawsuits. Single trials generally tend to lessen the delay, expense[,] and inconvenience to all concerned." Patrick Collins, Inc. v. John Does 1-21 , 282 F.R.D. 161, 166 (E.D. Mich. 2012) (quoting Mosley v. Gen. Motors Corp. , 497 F.2d 1330, 1332 (8th Cir. 1974) ). Therefore, when exercising its discretion under Rule 20, trial courts should "accord a liberal interpretation to the requirements in order to prevent unnecessary multiple lawsuits." Ivery v. Gen. Die Casters, Inc. , No. 5:17-cv-37, 2017 WL 6270239, at *3 (N.D. Ohio Dec. 8, 2017) (citing Brown v. Worthington Steel, Inc. , 211 F.R.D. 320, 324 (S.D. Ohio 2002) ). A district court may sever a party if they have been misjoined, but the court may not dismiss the action on that basis. Roberts v. Doe , No. 16-2082, 2017 WL 3224655, at *2 (6th Cir. Feb. 28, 2017) (citing Fed. R. Civ. P. 21 and cases).

i. Same Transaction or Occurrence

Plaintiffs’ claims against BMW arise out of the same set of transactions or occurrences. The determination of whether events arise out of the same set of transactions or occurrences is a fact-sensitive inquiry that must be analyzed on a case-by-case basis. Scott , 284 F. Supp. 2d at 888 (citing Bridgeport Music, Inc. v. 11C Music , 202 F.R.D. 229, 231–32 (M.D. Tenn. 2001) ). The phrase "transaction or occurrence" is "given a broad and liberal interpretation in order to avoid a multiplicity of suits." LASA Per L'Industria Del Marmo Societa Per Azioni of Lasa, Italy v. Alexander , 414 F.2d 143, 147 (6th Cir. 1969). To determine whether claims arise from the same transaction or occurrence, the reviewing court evaluates whether there is a logical relationship between the claims. See id.

BMW asserts that plaintiffs’ claims must be severed because they do not arise out of the same transaction or occurrence. Specifically, BMW argues that the allegations in the amended complaint are the result of seven separate transactions, spanning a seven-year period, and which occurred at six different dealerships. (Memo at 257.) Additionally, "[e]ach plaintiff's warranty claims are specific to the particular BMW car ... he or she purchased." ( Id. at 258.)

Plaintiffs, on the other hand, claim that joinder is proper, citing El Fakih v. Nissan N. Am., Inc. , No. 18-cv-60638, 2018 WL 4193675, at *1 (S.D. Fla. July 26, 2018)a case with facts similar to those at issue here. (Opp'n at 436–37.) In El Fakih , plaintiffs were Florida residents who purchased cars with a transmission defect which caused the vehicles to "hesitate, jerk, and lack power...." Id. The vehicle manufacturer, Nissan, acknowledged the transmission defect and distributed a TSB to its authorized dealerships. Id. But the remedies contained in the TSB did not fix the defect. Id. Plaintiffs ultimately brought suit against Nissan, asserting claims under the Warranty Act. Id. at *2. Nissan filed a motion to sever, arguing that the plaintiffs’ claims did not arise out of the same transaction or occurrence. Id. In denying the motion to sever, the El Fakih Court held that plaintiffs’ claims were all "premised on the same faulty transmissions...." Id. at *4. And even though plaintiffs "individually purchased their vehicles and [took] them to varying dealerships for repairs," their claims arose out of the same series of transactions or occurrences because their vehicles contained the same defective transmission and Nissan failed to honor its warranty. Id.

Here, like in El Fakih , the plaintiffs’ claims all arise from the same factual occurrences; they each purchased a BMW automobile with a defective N63 engine....

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