Parrish v. Volkswagen Grp. of Am., Inc.

• Decision Date: 07 May 2020
• Docket Number: CV 19-1148 DSF (KESx)
• Citation: 463 F.Supp.3d 1043
• Court: U.S. District Court — Central District of California
• Parties: Dominique PARRISH, etc., et al., Plaintiffs, v. VOLKSWAGEN GROUP OF AMERICA, INC., Defendant.

463 F.Supp.3d 1043

Dominique PARRISH, etc., et al., Plaintiffs,

v.VOLKSWAGEN GROUP OF AMERICA, INC., Defendant.

CV 19-1148 DSF (KESx)

United States District Court, C.D. California.

Signed May 7, 2020

Cody R. Padgett, Tarek H. Zohdy, Trisha Kathleen Monesi, Steven R. Weinmann, Mark A. Ozzello, Capstone Law APC, Los Angeles, CA, Amey J. Park, Pro Hac Vice, Russell D. Paul, Pro Hac Vice, Berger Montague PC, Philadelphia, PA, for Plaintiffs Dominique Parrish, Evan Wood.

Cody R. Padgett, Steven R. Weinmann, Tarek H. Zohdy, Trisha Kathleen Monesi, Capstone Law APC, Los Angeles, CA, for Plaintiffs Ludwig Combrinck, Trine Utne.

Homer B. Ramsey, Pro Hac Vice, Michael B. Gallub, Pro Hac Vice, Herzfeld and Rubin PC, New York, NY, Craig L. Winterman, Herzfeld and Rubin LLP, Los Angeles, CA, for Defendant.

Order GRANTING in Part and DENYING in Part Defendant's Motion to Dismiss (Dkts. 47, 62)

Dale S. Fischer, United States District Judge

Defendant Volkswagen Group of America, Inc. moves to dismiss the Third Amended Complaint (TAC) filed by Plaintiffs Dominique Parrish, Valerie Wood, Ludwig Combrinck, and Trine Utne in its entirety. Dkt. 62 (Mot.).¹ Plaintiffs oppose.

Dkt. 65 (Opp'n). The Court deems this matter appropriate for decision without oral argument. See Fed. R. Civ. P. 78 ; Local Rule 7-15.

I. BACKGROUND

Plaintiffs, who purchased or leased vehicles manufactured, marketed, distributed, and sold by Defendant, bring this action on behalf of themselves and a putative class. Dkt. 43 (TAC) ¶¶ 1, 3, 16, 24, 34, 42. Plaintiffs allege that the 2019 to present Volkswagen Jetta and the 2018 to present Volkswagen Tiguan are equipped with a defective transmission (the Transmission). Id. ¶¶ 1, 3. Specifically, Defendant "calibrated the Transmission's software to engage higher gears at insufficient speeds and insufficient revolutions per minute (‘RPMs’) and likewise programmed the torque converter to lock up at insufficient speeds and at insufficient RPMs." Id. ¶ 7. As a result of this alleged defect, "the Transmission grates, scuffs, scrapes, grinds, suffers hard and sudden shifts, delayed acceleration, hesitation, banging into gear, and ultimately suffers broken seals and oil leaks, resulting in catastrophic failure" (the Defect). Id. Each named plaintiff experienced issues allegedly caused by the Defect after purchasing or leasing his or her Volkswagen.

Parrish and Combrinck, who are California citizens that purchased or leased their vehicles in California, TAC ¶¶ 15-16, 33-34, bring claims for violation of the California Consumer Legal Remedies Act (CLRA), breach of implied warranty under the Song-Beverly Consumer Warranty Act (Song-Beverly Act), and violation of the California Unfair Competition Law (UCL). Wood, a Pennsylvania resident who purchased his vehicle in Pennsylvania,² TAC ¶¶ 23-24, brings claims for violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL), breach of express warranty, and breach of implied warranty of merchantability. Utne, a Utah citizen who leased her vehicle in Utah, TAC ¶¶ 41-42, brings claims for violation of the Utah Consumer Sales Practices Act (UCSPA) and breach of implied warranty of merchantability. Plaintiffs also bring claims for breach of express and implied warranty under the Magnuson-Moss Warranty Act (MMWA) and for unjust enrichment.

II. LEGAL STANDARD

Rule 12(b)(6) allows an attack on the pleadings for failure to state a claim on which relief can be granted. "[W]hen ruling on a defendant's motion to dismiss, a judge must accept as true all of the factual allegations contained in the complaint." Erickson v. Pardus, 551 U.S. 89, 94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam). However, a court is "not bound to accept as true a legal conclusion couched as a factual allegation." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "Nor does a complaint suffice if it tenders ‘naked assertion[s]’ devoid of ‘further factual enhancement.’ " Id. (quoting Twombly, 550 U.S. at 557, 127 S.Ct. 1955 ) (alteration in original) (citation omitted). A complaint must "state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570, 127 S.Ct. 1955. This means that the complaint must plead "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. There must be "sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively ... and factual allegations that are taken as true must plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation." Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011).

Ruling on a motion to dismiss will be "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense. But where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not ‘show[n]'—'that the pleader is entitled to relief.’ " Iqbal, 556 U.S. at 679, 129 S.Ct. 1937 (alteration in original) (citation omitted) (quoting Fed. R. Civ. P. 8(a)(2) ).

As a general rule, leave to amend a complaint that has been dismissed should be freely granted. Fed. R. Civ. P. 15(a). However, leave to amend may be denied when "the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency." Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986).

III. DISCUSSION

A. Violation of State Consumer Statutes (First, Sixth, and Ninth Causes of Action)

Plaintiffs bring claims under the California, Pennsylvania, and Utah consumer protection statutes. The CLRA prohibits "unfair methods of competition and unfair or deceptive acts or practices" including "[r]epresenting that goods ... have ... characteristics ... which they do not have" or "that goods ... are of a particular standard, quality, or grade, ... if they are of another." Cal. Civ. Code § 1770(a). The UTPCPL prohibits "[u]nfair methods of competition" and "unfair or deceptive acts or practices," including "[e]ngaging in any ... fraudulent or deceptive conduct which creates a likelihood of confusion or of misunderstanding." 73 Pa. Stat. Ann. §§ 201-3, 201-2(4)(xxi). The UCSPA prohibits any "deceptive act or practice" including "knowingly and intentionally ... indicat[ing] that the subject of a consumer transaction has sponsorship, approval, performance characteristics, accessories, uses, or benefits, if it has not" or "that the subject of a consumer transaction is of a particular standard, quality, grade, style, or model, if it is not." Utah Code Ann. § 13-11-4(2)(a)-(b).

Defendant contends these claims should be dismissed because 1) they fail to adequately allege an actionable false statement or omission and 2) they fail to adequately allege entitlement to certain remedies.

1. False Statements or Omissions

Defendant contends that Wood's UTPCPL claim fails to allege an actionable misrepresentation and all three consumer statute claims fail to allege an actionable omission.³

a. Misrepresentations

Wood alleges that Defendant violated the UTPCPL, in part, "by marketing its vehicles as safe, reliable, easily operable, efficient, and of high quality." FAC ¶ 293. Defendant argues that the terms "safe," "reliable," "easily operable," and "high quality," are "non-actionable puffery that cannot support a claim of misrepresentation or deceptive conduct under the UTPCPL." Mot. at 8.⁴ Defendant is correct that puffery is non-actionable under the UTPCPL, but Defendant fails to address Commonwealth by Shapiro v. Golden Gate Nat'l Senior Care LLC, 648 Pa. 604, 194 A.3d 1010 (2018), the Pennsylvania Supreme Court case that held that "whether a statement is deemed puffery is a question of fact to be resolved by the finder of fact except in the unusual case where the answer is so clear that it may be decided as a matter of law." Id. at 626, 194 A.3d 1010. "Determination of whether a statement is puffery requires consideration of the overall impression of the statement and the context in which it is made." Id. at 627, 194 A.3d 1010. Without having the specific advertisements before it, the Court cannot conclude that the alleged marketing statements are puffery as a matter of Pennsylvania law.

Defendant also argues that even if those statements are not puffery, Wood has failed to plead justifiable reliance. Mot. at 9 (citing Yocca v. Pittsburgh Steelers Sports, Inc., 578 Pa. 479, 501, 854 A.2d 425 (2004) ). The Court agrees. Here, Wood has alleged that "[b]efore making his purchase, [he] watched television ads, visited Defendant's website to research the 2019 Jetta, ... test drove his vehicle with a dealership salesperson[,] ... and even spoke with the service manager of Young Volkswagen, Inc. who recommended the vehicle." TAC ¶ 26. However, it is not clear from the TAC whether any of these sources provided the alleged misrepresentations regarding safety or reliability or even what those alleged misrepresentations were. For example, simply recommending the vehicle, without more, is not an actionable misstatement. Plaintiffs contend that under certain circumstances, reliance can be presumed. Opp'n at 15 (quoting Wilson v. Parisi, 549 F. Supp. 2d 637, 668 (M.D. Pa. 2008) ). While this may be true for UTPCPL claims based on omissions, see Zwiercan v. Gen. Motors Corp., 58 Pa. D. & C.4th 251 (Com. Pl. 2002) ("where ... a [p]laintiff can demonstrate that they would not have purchased a product had they been aware of the defect, reliance on the defendant's omission can be presumed"), Plaintiffs do not provide any authority that the same is true...