Hamilton v. O'Connor Chevrolet, No. 02 C 1897.

• Decision Date: 16 November 2005
• Docket Number: No. 02 C 1897.
• Citation: 399 F.Supp.2d 860
• Parties: Deborah and Kwanza HAMILTON, Plaintiffs, v. O'CONNOR CHEVROLET, INC., Defendant.
• Court: U.S. District Court — Northern District of Illinois

399 F.Supp.2d 860

Deborah and Kwanza HAMILTON, Plaintiffs, v. O'CONNOR CHEVROLET, INC., Defendant.

No. 02 C 1897.

United States District Court, N.D. Illinois, Eastern Division.

November 16, 2005.

Dmitry N. Feofanov, Dixon, IL, Lance A. Raphael, Allison Amy Krumhorn, Stacy Michelle Bardo, Lance A. Raphael, Allison Amy Krumhorn, Chicago, IL, for Plaintiffs.

Brian Thomas Bailey, James M. Bailey, Bailey & Bailey, Chicago, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

FILIP, District Judge.

Plaintiffs, Deborah and Kwanza Hamilton ("Plaintiffs" or "the Hamiltons"), purchased an automobile from Defendant, O'Connor Chevrolet, Inc. ("Defendant" or "O'Connor"), and brought suit regarding that transaction under various federal and state statutes. (D.E. 26 (the operative complaint, also "Complaint").) Defendant previously filed a summary judgment motion directed only to federal claims. After the Court denied in part and granted in part Defendant's motion concerning those federal claims, the parties briefed the propriety of summary judgment concerning state law claims and a Magnuson-Moss claim that the parties agreed could not independently provide federal jurisdiction because of the relatively small amount of money at issue in Plaintiffs' case. The instant summary judgment motion is therefore directed to: (1) an alleged breach of the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301, et seq. (Count V); (2) an alleged violation of section 2C of the Illinois Consumer Fraud Act (Count VII); and (3) an alleged violation of the Illinois Consumer Fraud Act based on putative misrepresentations and omissions (Count VIII). (D.E.58.) For the reasons stated below, the Motion is granted in part and denied in part. It is denied with respect to Counts V and VII. It is granted in part and denied in part as to Count VIII.

I. Factual Background

A. Lack of Compliance with Local Rule 56.1

The relevant facts are taken from the proper portions of the parties' filings under Local Rule 56.1 ("L.R.56.1"). As is the practice in this district, the Court only considers those facts that are presented in conformity with L.R. 56.1. The Seventh Circuit has "consistently and repeatedly upheld a district court's discretion to require strict compliance" with L.R. 56.1. See Bordelon v. Chicago Sch. Reform Bd. of Trs., 233 F.3d 524, 527 (7th Cir.2000); accord Cichon v. Exelon Generation Co., LLC, 401 F.3d 803, 809 (7th Cir.2005).

The Seventh Circuit and district courts have not been wedded to enforcement of the local rule as a matter of mere formalism. Rather, precedent acknowledges that it is a "reasonable judgment" that "consistent, `bright-line' enforcement is essential"—not only in promoting compliance with the local rule, but also "to ensuring that [the] long-run aggregate benefits in efficiency" that LR 56.1 is intended to produce are realized for the system of justice in the Northern District of Illinois. Koszola v. Bd. of Ed. of City of Chicago, 385 F.3d 1104, 1109 (7th Cir.2004) (collecting cases); accord, e.g., Midwest Imports v. Coval, 71 F.3d 1311, 1316 (7th Cir.1995). In addition, the process established in LR 56.1 (and its predecessor, L.R. 12(M) and (N)), helps focus and narrow the factual disputes so the court is not attempting to guess at what fairly can be argued and inferred from an often massive factual record; that dynamic helps to ensure that the summary judgment process best promotes fair results for all.

The parties each included additional facts in their responses to each other's L.R. 56.1(a) statement of material facts. The Seventh Circuit has consistently affirmed that this practice is improper under the rule and that statements contained in responses that go beyond what is necessary to justify a denial will not be considered. See Cichon, 401 F.3d at 809 (collecting cases); Midwest Imports, 71 F.3d at 1316-17; see also Smith v. Lamz, 321 F.3d 680, 683 (7th Cir.2003); Bordelon, 233 F.3d at 528-29. Thus, the Court disregards the additional statements of fact contained in the following paragraphs: Plaintiffs' Response to O'Connor's LR 56.1 Statement of Material Facts ("D.E.63") ¶¶ 7, 16, and 30; and Defendant's Response to Plaintiff's Statement of Additional Material Facts ("D.E.64") ¶ 21.

Where a party has offered a legal conclusion, the Court will not consider the statement. See, e.g., Malec v. Sanford, 191 F.R.D. 581, 583-85 (N.D.Ill.2000) ("[A] movant's 56.1(a) statement should contain only factual allegations. It is inappropriate to allege legal conclusions."). Accordingly, the Court will disregard the legal argument in the following paragraph: D.E. 64 ¶ 5.

Additionally, the Court finds that certain of the Hamiltons' statements of fact overstate the evidence. The Court, therefore, has gone through the record and, where cited herein, has considered the actual evidence from the record. Accord Malec, 191 F.R.D. at 583 ("Factual allegations not properly supported by citation to the record are nullities.")

B. Relevant Facts¹

On March 15, 2001, the Hamiltons went to O'Connor to purchase a car. (D.E. 63 ¶ 5.) Ms. Hamilton testified at her deposition that she and Mr. Hamilton were told by an O'Connor salesperson that the 1996 Chrysler LHS (the "Chrysler") they were considering purchasing was "privately owned." (D.E. 59 ¶ 30 and Ex. A at 13.) Ms. Hamilton understood this to mean that the car had one previous owner. (Id. ¶ 31.) The salesperson told Deborah Hamilton that the Chrysler had been looked over by a mechanic. (Id. ¶ 32.) The Hamiltons claim that O'Connor told them that the Chrysler had a "Blue Book" value of $25,000, when the Kelley Blue Book actually valued the vehicle, assuming an excellent condition, at only $11,225. (D.E. 63 at 11, ¶ 20.)

1. The Retail Contract

That same day, in relation to their purchase of the Chrysler, the Hamiltons signed a retail installment contract (the "Retail Contract") with O'Connor listed as the "Seller." (D.E. 59 ¶¶ 6 and 8.) The back side of the retail installment contract contained the following bold-face language:

Warranties Seller Disclaims. You understand that the Seller is not offering any warranties and that there are no implied warranties of merchantability, of fitness for a particular purpose, or any other warranties, express or implied by the Seller, covering the vehicle unless the Seller extends a written warranty or service contract within 90 days from the date of this contract.

(Id. at ¶ 7; D.E. 63, Ex. 11.) O'Connor also provided the Hamiltons with a "We Owe" slip, which allowed the Hamiltons to have the brakes checked and repaired by O'Connor at no charge for thirty days from the date of issuance. (D.E. 59 ¶ 13 and Ex. D.)

The Retail Contract, executed on March 15, 2001, reflects a financing rate of 12.75% for the approximately $13,600.00 loan for the purchase of the Chrysler. (D.E.63, Ex. 11.)² As reported in the Retail Contract, the Hamiltons gave a down payment of $2,000 as consideration with respect to delivery of the Chrysler. (Id.) Ms. Hamilton testified that when she left O'Connor on March 15, 2001, taking possession of the Chrysler, she was "under the understanding that this retail installment contract, the percentage rate, and everything else was locked in." (D.E. 59, Ex A at 38.) Relying on the Affidavit of Spot Delivery signed by both Ms. Hamilton and her son, Kwanza, on March 15, 2001, O'Connor disputes this fact, claiming that the Hamiltons understood that financing with respect to the Chrysler was not locked in and was subject to subsequent approvals. (D.E. 64 ¶ 17 and Ex. B).

On March 26, 2001, GMAC sent O'Connor a fax stating, "Please send a check or new contract for the rate difference. B tier is 14.75%. Contract is 12.75. To buy down it is $845.00." (D.E.63, Ex. 8.) Sometime shortly after March 26, 2001 (roughly two weeks after March 15, 2001, and at least March 26, 2001), the Hamiltons returned to O'Connor and signed a new Retail Contract with a revised financing rate of 15.75%. (Compare D.E. 63, Ex. 11 with D.E. 59, Ex. B) (showing that initial Retail Contract had an interest rate of 12.75%, and that second Retail Contract is the same in all material respects except for the new interest rate of 15.75%).³ The Hamiltons claim that an employee at O'Connor told them that 15.75% was the best interest rate available to them. (D.E. 63 at 12, ¶ 25.)

2. The Service Contract

On March 15, 2001, the Hamiltons also entered into a service contract (the "Service Contract") in relation to their purchase of the vehicle with a company named Lyndon American, Inc. ("Lyndon American"). (D.E. 59 ¶ 9 and Ex. C.) The parties dispute O'Connor's role with respect to the Service Contract. (D.E. 63 ¶¶ 9-11 and D.E. 64 ¶¶ 1-5.)⁴ For example, O'Connor admits that it told the Hamiltons the price of the Service Contract. (D.E. 64 ¶ 1.) In response to interrogatories, the Hamiltons assert that an employee at O'Connor "wrote up the service contract." (D.E. 63, Ex. 3 at ¶ 3.⁵) Ms. Hamilton also testified as follows:

Q: Was it your understanding when you left O'Connor Chevrolet on March 15, 2001, that the dealership was going to be responsible for making any repairs to the vehicle?

A: Yes. Because we had purchased an extended warranty.⁶ And as told by [an employee] of O'Connor Chevrolet, we were told if we had any problems under the warranty, they would repair and fix any and all problems. If we needed a car, we could get a loaner car. If they didn't have one available, we could get one from Enterprise, rent one from Enterprise, and we will be reimbursed for it.

(D.E. 59, Ex. A at 43.) O'Connor disputes that it agreed to repair and fix any problems with the vehicle, arguing that the deposition transcript demonstrates that Ms. Hamilton merely understood this to be the case and that the Service Contract shows otherwise. (D.E. 64 ¶ 3.) The parties agree, however, that O'Connor retained approximately $500 of the approximately $1,300 the Hamiltons paid for the Service...