Haugland v. Winnebago Industries

• Decision Date: 08 July 2004
• Docket Number: No. CV 03-1418PHXMS.,CV 03-1418PHXMS.
• Citation: Haugland v. Winnebago Industries, 327 F.Supp.2d 1092 (D. Ariz. 2004)
• Parties: Kjell HAUGLAND, Plaintiff, v. WINNEBAGO INDUSTRIES, et al., Defendants.
• Court: U.S. District Court — District of Arizona

Page 1092

327 F.Supp.2d 1092

Kjell HAUGLAND, Plaintiff, v. WINNEBAGO INDUSTRIES, et al., Defendants.

No. CV 03-1418PHXMS.

United States District Court, D. Arizona.

July 8, 2004.

Marshall Meyers, Krohn & Moss Ltd, Phoenix, AZ, for Plaintiff.

Kerry Matthew Griggs, Patrick Gerard Rowe, Cavanagh Law Firm PA, Negatu Molla, Esq, Lori Anne Van Daele, David Wendall Williams, Bowman & Brooke, James K. Kloss, Esq, Lewis & Roca LLP, Phoenix, AZ, for Defendants.

Jerry Doyle Worsham, II, Gammage & Burnham PLC, Phoenix, AZ, for Arbitrator.

ORDER

SITVER, United States Magistrate Judge.

Before the Court are the following motions:

1. Plaintiff's "Motion to Conduct Discovery" (Doc. # 22);

2. Defendant Workhorse Custom Chassis' ("Workhorse") "Motion to Dismiss" (Doc. # 27); and,

3. Plaintiff's "Motion to Strike Affidavit of Alan Cohen" (Doc. # 30).

On March 30, 2004, Defendant Atwood Mobile Products ("Atwood") joined in Workhorse's Motion to Dismiss (Doc. # 39). On May 19, 2004, Workhorse withdrew Section IV of its Motion to Dismiss (the failure to exhaust or pursue informal dispute resolution claim) pursuant to Judge Martone's May 14, 2004 Order¹ in which he reminded the parties that his denial of Workhorse's Motion to Dismiss may have preclusive affects in other similar, but unconsolidated, cases (Doc. # 49). Accordingly, Plaintiff's Motion to Strike the Affidavit of Alan Cohen, which Defendant Workhorse submitted in support of its exhaustion argument, will be denied as moot.

Defendants Workhorse and Atwood² maintain, however, that their Motion to Dismiss for lack of subject matter jurisdiction and failure to state a claim should still be entertained by the Court. Workhorse manufactured the chassis of Plaintiff's allegedly defective motor home, and Atwood the water heater, for the RV manufacturer, Defendant Winnebago Industries ("Winnebago"). Plaintiff purchased the motor home from La Mesa RV Center, who is not a party to this action.³

I. Subject Matter Jurisdiction

A. Amount in Controversy

Defendants contend, as Workhorse did before Judge Martone and Judge Campbell,⁴ that the Court cannot exercise subject matter jurisdiction over this case. Defendants argue that because the value of Plaintiff's claim is less than $50,000, Plaintiff does not satisfy the Magnuson Moss Warranty Act's ("MMWA")⁵ amount in controversy requirement.⁶ Judge Martone and Judge Campbell have both determined that the $50,000 requirement relates to the value of the motor home as a whole, not its component parts.⁷ This Court agrees. Plaintiff has satisfied the amount in controversy requirement because he seeks a refund of $167,559.40⁸ paid for the motor home.

B. Vagueness

As further basis for their argument that the Court lacks subject matter jurisdiction, and should dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(1), Defendants claim that other than a jurisdictional statement, Plaintiff's Amended Complaint contains no averment alleging that Defendants are in breach of the MMWA. In his response, Plaintiff counters that Federal Rule of Civil Procedure 8 requires only notice pleading, and that the Rule "creates a strong presumption" against dismissing the Amended Complaint as deficient. In its Reply, Workhorse maintains that it could not from the face of the Amended Complaint determine whether Plaintiff's claim was under the MMWA, Arizona's Lemon Law, or both, and that it is not acceptable for Plaintiff to refer to the MMWA for the first time in this litigation in its response to the Motion to Dismiss.

The Court will deny Defendants' Motion to Dismiss based in the vagueness of the claims contained in the Amended Complaint. If Defendants found the complaint "so vague or ambiguous" that they could not be "required to frame a responsive pleading," Defendants could have filed a Motion for More Definite Statement pursuant to Federal Rule of Civil Procedure 12(e). The Court notes the Defendants' claim — that in no way could it determine the basis of Plaintiff's claims from the Amended Complaint — is somewhat disingenuous, in that Plaintiff's amended complaints in Judge Martone's and Judge Campbell's cases are virtually identical to the Amended Complaint in this case. Defendants in those cases, however, made no claim in their motions to dismiss that the amended complaints should be dismissed for vagueness.

C. Lack of Federal Question

Defendants claim that because Plaintiff only asserts an implied warranty of merchantability against them, and because the implied warranty of merchantability claims arises solely under state law, no federal question exists and the complaint must be dismissed. However, in the same motion, Defendants concede that limited warranties were issued to Plaintiff. Whether or not implied warranties may be asserted against Defendants, see analysis infra, liberally construed, Plaintiff's amended complaint contains an averment that Defendants have breached their express warranty. See ¶¶ 8, 11, Amended Complaint. Defendants' Motion to Dismiss on this ground will therefore be denied.

II. Failure to State a Claim Under Rule 12(b)(6)

Defendants aver that Plaintiff fails to state a claim, pursuant to Federal Rule of Civil Procedure 12(b)(6), for breach of implied warranty of merchantability and breach of express limited warranty. Specifically, Defendants aver that Plaintiff's breach of implied warranty of merchantability claim fails as a matter law for lack of privity under Arizona law. As for Plaintiff's breach of express limited warranty claim, Defendants argue that the "reasonableness" of Defendants' repairs is not the standard for determining whether Defendants' breached their limited warranty because Plaintiff fails to plead any state law claims in the Amended Complaint. Therefore, the Court's analysis of breach of limited warranty is limited to the four corners of the warranty itself, which Defendants contend was not breached.

A. Standard of Review

Pursuant to Federal Rule of Civil Procedure 12(b)(6), the Court may only dismiss a plaintiff's complaint if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957); Russell v. Landrieu, 621 F.2d 1037, 1039 (9th Cir.1980). The question presented by a motion to dismiss for failure to state a claim is not whether a plaintiff will prevail in an action, but instead whether Plaintiff is entitled to offer evidence in support of the claims contained in the complaint. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974); Usher v. Los Angeles, 828 F.2d 556, 561 (1987). Dismissal is proper under Rule 12(b)(6) only when a plaintiff presents no cognizable legal theory to support his claims, or an absence of facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir.1988).

In evaluating a motion to dismiss under Rule 12(b)(6), the Court must assume that all of plaintiff's allegations are true, and must construe the complaint in a light most favorable to the plaintiff. McKinney v. Debord, 324 F.Supp. 928 (E.D.Cal.1970). "As a general rule, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion." Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir.2001). Even if documents are not physically attached to the Complaint, however, the Court may consider them without converting the Rule 12(b)(6) motion to dismiss into a motion for summary judgment if the documents'" `authenticity ... is not contested' and `the plaintiff's complaint necessarily relies' on them." Id. (quoting Parrino v. FHP, Inc., 146 F.3d 699, 705-06 (9th Cir.1998)).

B. Whether the Federal or State Law Applies to Plaintiff's Implied Warranty of Merchantability Claim, and, If State Law Does Apply, Whether Arizona Requires Privity of Contract

Defendants contend that Plaintiff fails to state a claim for breach of implied warranty of merchantability because Defendants did not directly sell the motor home or its components to Plaintiff and therefore no privity of contract exists. The Court notes that in the Amended Complaint, Plaintiff only refers to an implied warranty of merchantability claim,⁹ although implied warranties include an implied warranty of fitness as well as merchantability.¹⁰ In its Motion to Dismiss, Workhorse addresses only an implied warranty of merchantability claim.

Plaintiff acknowledges that the Arizona Supreme Court in Flory v. Silvercrest Industries, 129 Ariz. 574, 633 P.2d 383 (1981) required privity of contract for implied warranty of merchantability claims made pursuant to the Arizona Uniform Commercial Code ("U.C.C.").¹¹ Plaintiff notes, however, that the Arizona Supreme Court later clarified in Richards v. Powercraft Homes, Inc., 139 Ariz. 242, 678 P.2d 427 (1984) (en banc), that the privity requirement only applies to U.C.C. claims. Plaintiff states that his implied warranty claims are brought pursuant to the MMWA and not the Arizona U.C.C., and that the Court should not apply "antiquated" privity requirements in MMWA cases.¹²

Defendants counter that under the MMWA, implied warranties arise only under state law. Defendants cite Walsh v. Ford Motor Co., 588 F.Supp. 1513, 1527 (D.D.C.1984), which held that Arizona law applies to MMWA implied warranty claims and that privity of contract is required. Defendants distinguish the later decision of the Arizona Supreme Court in Richards, noting that the Arizona Supreme Court in Columbia Western Corp. v. Vela, 122 Ariz. 28, 592 P.2d 1294 (1979), distinguished between implied warranties created by statute (e.g., Arizona U.C.C. claims such as the implied warranty of merchantability) and those imposed "by law" (such as the implied warranties of workmanship and habitability). Therefore, although the Arizona Supreme Court in Richards eliminated the privity requirement...