James Michael Leasing Co. v. Paccar Inc.
| Decision Date | 19 November 2012 |
| Docket Number | Case No. 11–C–0747. |
| Parties | JAMES MICHAEL LEASING CO., LLC, Plaintiff, v. PACCAR INC., d/b/a Kenworth Truck Company, Defendant. |
| Court | U.S. District Court — Eastern District of Wisconsin |
OPINION TEXT STARTS HERE
Susan M. Grzeskowiak, Timothy J. Aiken, Vincent P. Megna, Aiken & Scoptur SC, Milwaukee, WI, for Plaintiff.
Jeffrey S. Fertl, Hinshaw & Culbertson LLP, Milwaukee, WI, for Defendant.
DECISION AND ORDER
In this diversity case, James Michael Leasing Company, LLC (“James Michael Leasing”) alleges that PACCAR, Inc., d/b/a Kenworth Truck Company (“PACCAR”) violated Wisconsin's lemon law, Wis. Stat. § 218.0171. In August 2007, James Michael Leasing purchased a Kenworth semitruck manufactured by PACCAR from PACCAR's dealer in Milwaukee. The parties agree that the truck was a “lemon” and that the lemon law entitled James Michael Leasing to return the truck for a refund. The dispute in this case is over whether PACCAR complied with the lemon law in making the refund. The parties have filed cross-motions for summary judgment, which I consider below.
James Michael Leasing took delivery of the Kenworth truck from Wisconsin Kenworth,one of PACCAR's dealers, on August 29, 2007. On June 7, 2011, James Michael Leasing served PACCAR with notice that it wanted to return the truck for a refund in accordance with Wisconsin's lemon law. PACCAR agreed that the truck was a lemon and put Shawn Miller in charge of issuing a refund. On June 28, 2011, Miller advised Janie Kincaid, who handled the dispute on behalf of James Michael Leasing, that PACCAR would issue a refund, and that it had calculated the refund as follows:
The next day, Miller sent another email in which he stated that PACCAR would send two checks made out to James Michael Leasing to PACCAR's Milwaukee dealership-one for the refund to James Michael Leasing, and one for the lien payoff. Miller stated that James Michael Leasing would be responsible for seeing that the lien was paid off, and that once it was James Michael Leasing should transfer title to the truck to PACCAR and return the truck to the Milwaukee dealership. Kincaid responded to Miller's email and stated that she thought that the refund amount should be increased by $53, which represented the title fee that James Michael Leasing had paid when it purchased the truck. She also stated that James Michael Leasing did not want to be responsible for paying off the lien.
Miller responded to Kincaid's email and agreed that the $53 title fee needed to be added to the refund. However, he reiterated that James Michael Leasing would be responsible for paying off the lien. In addition, Miller noted that the Wisconsin lemon law allows a manufacturer to deduct a reasonable allowance for use from the refund amount, and that PACCAR would thus reduce the refund by $3,751.24. Miller arrived at this number after reviewing the part of the Wisconsin lemon law stating that a reasonable allowance for use “may not exceed” the amount obtained by multiplying the “full purchase price of the motor vehicle” by a fraction, the denominator of which is 100,000, and the numerator of which is the number of miles the vehicle was driven before the consumer first reported a problem to the dealer. SeeWis. Stat. § 218.0171(2)(b)2.b. Using this formula, Miller decided that the full purchase price was $121,952 (which was the purchase price as listed on the invoice, $135,847, less the federal excise tax of $13,895), and that the number of miles driven before James Michael Leasing reported a problem was 3,076. Thus, Miller's calculation looked like this: $121,952 x (3076mi/100,000mi) = $3,751.24.
After Miller applied the title and reasonable-use adjustments, the refund amount became $114,043.61. Miller advised Kincaid that a check in that amount, along with a check in the amount of $61,868.30 for the lien payoff, could be delivered to James Michael Leasing on July 1, 2011. In response to this email, Kincaid stated that she would return the truck to the dealer on Tuesday, July 5, 2011, that the check should be delivered to her, but that she did not want to be responsible for paying off the lien.
On July 1, 2011, Mike Oswald, an employee of PACCAR's Milwaukee dealership, traveled to James Michael Leasing's offices to personally deliver the two checks. When he arrived, he presented Kincaid and Michael Smiley, the owner of James Michael Leasing, with the checks. Kincaid took the checks and made copies of them. At that point, Kincaid and Smiley informed Oswald that they would not accept the checks. According to Oswald, Kincaid and Smiley refused to accept the checks because they did not want to be responsible for paying off the lien. Oswald reported these events to Miller, and Miller instructed Oswald to re-offer a check in the amount of $114,043.61 to James Michael Leasing along with an assurance that PACCAR would pay off the lien directly. Oswald returned to James Michael Leasing's offices later in the day on July 1 to do so. However, Kincaid again rejected the check, this time on the ground that the amount of the refund was incorrect. Kincaid did not explain to Oswald why she thought the refund amount was incorrect. Oswald again reported what had transpired to Miller, and Miller wrote an email to Kincaid in which he summarized the day's events and asked her to explain why the refund amount was incorrect.
On July 5, 2011, Kincaid responded to Miller's email and explained that the refund was incorrect because the deduction for reasonable use was excessive. Kincaid stated that she thought the deduction should be $364.26, which she calculated by multiplying the number of miles the truck had been driven before a problem was reported, which according to her was 3,061, by 11.9 cents per mile. Kincaid also stated that because no agreement had been reached as to the amount of the refund, James Michael Leasing would not be returning the truck to the dealer that day. Miller responded to Kincaid's email by explaining that he had calculated the deduction for reasonable use in accordance with the formula that appears in the Wisconsin lemon law and asked Kincaid to reconsider. Kincaid responded by explaining that she thought that the formula produced a deduction that was too high. She stated that the denominator in the formula should be 1 million miles, rather than 100,000 miles, which resulted in a reasonable-use deduction of $369.12.
On July 6, 2012, Miller wrote an email to Kincaid in which he stated that he had been informed that James Michael Leasing had returned the truck to the Milwaukee dealership. Miller stated that he understood this action to constitute an acceptance of PACCAR's offer to issue a refund in the amount of $114,043.61. In response, Kincaid sent Miller the following email on July 7, 2011:
In good faith, we parked the truck at the dealer on Tuesday, July 5th, because I said we would go to the dealer on Tuesday with the truck. We expected you to pay us what we had coming.
The amount of $114,043.61 offered by [PACCAR] is not acceptable or agreeable. The mileage charge is too high. I made that clear in our last email as well as previous emails, including my email of July 5th.
Please send James Michael Leasing a check immediately in the sum of $117,425.73. This sum allows for the mileage charge of $369.12 per my last email. You may deliver the check to our business [or mail it].
Megna Aff. Ex. I, at p. 2–O, ECF No. 19–9. Miller responded to this email later the same day. He stated that PACCAR would stand firm on its calculation of the refund. He also stated the following:
Since James Michael Leasing will not agree to accept a check in the amount of $114,043.61 along with [PACCAR's] direct payoff of the remaining PACCAR Financial lien balance in the amount of $61,868.30 to resolve this WI LL complaint, then James Michael Leasing needs to pick up the truck from the Oak Creek Wisconsin Kenworth dealership as soon as possible. Any delay in picking up the truck may result in the dealer charging James Michael Leasing storage fees.
Id. at p. 2–P. After receiving this email, James Michael Leasing retrieved the truck from the dealership. The truck is still in its possession.
On July 15, 2011, James Michael Leasing commenced the present lawsuit by filing a complaint in state court. PACCAR removed the case to this court on August 8, 2011. James Michael Leasing and PACCAR have filed motions for summary judgment.
Under the Wisconsin lemon law, a consumer 2 who has purchased a vehicle that turns out to be a lemon has the right to return the vehicle and receive either a refund or a comparable new vehicle from the manufacturer. SeeWis. Stat. § 218.0171(2)(b)2....
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