Wozniak v. Ford Motor Co.
| Decision Date | 04 January 2019 |
| Docket Number | Case No. 2:17-cv-12794 |
| Parties | JOSH WOZNIAK, et al., Plaintiffs, v. FORD MOTOR COMPANY, Defendant. |
| Court | U.S. District Court — Eastern District of Michigan |
HON. STEPHEN J. MURPHY, III
On December 5, 2017, Plaintiffs filed a 120-count amended class action complaint. ECF 14. Plaintiffs allege violations of the Magnuson-Moss Warranty Act and violations of state law in each of the fifty states on behalf of a nationwide class. See id. All claims arise from Plaintiffs' interactions with Ford as purchasers of Ford vehicles. Id. Plaintiffs allege that Ford used defectively-designed lug nuts. The defect allegedly causes the lug nuts to deform and swell, which makes them difficult to remove from the tires and impedes changing a flat tire. See id. at 623-25. Plaintiffs further allege that Ford violated its New Vehicle Limited Warranty ("NVLW") by failing to repair or replace the defective lug nuts when customers notified Ford of the issue. Id. at 660-64. Defendant filed a motion to dismiss on February 5, 2018. ECF 19. The Court held a hearing on the motion on September 5, 2018. Upon a thorough consideration of the pleadings and the arguments presented at the hearing, the Court will grant Defendant's motion.
When analyzing a motion to dismiss under Civil Rule 12(b)(6), the Court views the complaint in the light most favorable to the plaintiff, presumes the truth of all well-pleaded factual assertions, and draws every reasonable inference in favor of the non-moving party. Bassett v. Nat'l Collegiate Athletic Ass'n, 528 F.3d 426, 430 (6th Cir. 2008). To survive a motion to dismiss, "the complaint must contain either direct or inferential allegations respecting all the material elements to sustain a recovery under some viable legal theory." Nat'l Hockey League Players Ass'n v. Plymouth Whalers Hockey Club, 419 F.3d 462, 468 (6th Cir. 2005) (citation omitted). It must allege facts "sufficient 'to raise a right to relief above the speculative level,' and to 'state a claim to relief that is plausible on its face.'" Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, 609 (6th Cir. 2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007)).
Plaintiffs allege six claims as placeholders—24, 34, 41,45, 114, and 120 ("Place-Holder Claims"). The Place-Holder Claims do not assert any claims at all. Therefore, claims 24, 34, 41, 45, 114, and 120 must be dismissed for failure to state a claim.
Plaintiffs allege violations of the laws of each of the fifty states but present factual allegations on behalf of named Plaintiffs in only twenty-seven states. See ECF 14, PgID 507-10 (table of contents listing named Plaintiff's states). Although class-certification analysis may precede standing analysis when "the class certification issue [is] 'logically antecedent' to the standing issue", Smith v. Lawyers Title Ins. Co., No. 07-12124, 2009 WL 514210, at *2 (E.D. Mich. Mar. 2, 2009) (), our Court has held that " the 'logical[ly] antecedent' language should be construed in a manner that permits consideration of the standing issue . . . prior to class certification." Id. at *3. Like the plaintiffs in Smith, the named Plaintiffs here do not allege injuries in states other than their own or base their claims on the application of other states' laws. See id. Plaintiffs therefore lack standing to bring claims under the laws of the remaining twenty-three states. Claims 5, 9, 18, 19, 25, 26, 35, 36, 40, 58, 65, 69, 74, 83, 88, 96, 97, 98, 109, and 1131 must therefore be dismissed for lack of standing.
Plaintiffs have not alleged facts sufficient to plead a breach of warranty claim under the Magnuson-Moss Warranty Act or under the laws of any of the states in which they allege breaches of an express warranty. Ford's NVLW promises to "repair, replace, or adjust all parts on [a] vehicle that malfunction or fail during normal use during the applicable coverage period" if the vehicle "is properly operated and maintained" and "was taken to a Ford dealership for a warranted repair during the warranty period." ECF 14-14, PgID 1131-32. The relevant warranty period is theearlier of three years or 36,000 miles and begins on the day the customer takes delivery of the vehicle or the day it is first put into service, again, whichever is earlier. See ECF 14, PgID 662. Regardless of whether the Repair or Replace Warranty qualifies as an express warranty under any applicable state law, Plaintiffs have failed to adequately plead a breach because they have not pleaded that the named Plaintiff presented their vehicles to a Ford dealership before the earlier of three years or 36,000 miles occurred. Because the warranty expires upon the earlier of the time or mileage limits, Plaintiffs must allege both the timeline between the start of the warranty period and the sought-after repairs and the mileage on their vehicles at the time of presentment.
The only Plaintiff who properly alleged both a mileage and timeline within the warranty period is Donald Lycan, but he alleged that he merely presented the lug nuts to a dealership - and not his vehicle. See ECF 14, PgID 595; see also ECF 14-14, PgID 1131-32 (listing NVLW's prerequisite to free repair or replacement that the vehicle be taken to a dealership).
Plaintiffs readily acknowledge the shortcoming of their complaint but maintain that they do not need to plead the listed requirements to succeed on their breach-of-warranty claims because they adequately pleaded failure of the warranty's essential purpose. See ECF 20, PgID 1744. But Plaintiffs pleaded breach of express warranty for eleven states that have adopted the Uniform Commercial Code'sprovision regarding essential purpose.2 The provision provides that "[w]here circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this Act." U.C.C. § 2-719(2). For a repair-or-replace remedy to fail its essential purpose, however, the consumer must give the manufacturer an opportunity to repair or replace the alleged defect during the warranty period. See Miller v. Gen. Motors, LLC, No. 17-cv-14032, 2018 WL 2740240, at *6-7 (E.D. Mich. June 7, 2018).3 The essential purpose doctrine in each relevantstate is concerned with circumstances in which the essential purpose of the limited remedy agreed to by the parties would fail—in this case, the circumstances are repair or replacement of defective parts during the warranty period. See supra fn 3.
To plead that a remedy failed its essential purpose, Plaintiffs must plead facts sufficient to allege that they sought the limited remedy in the warranty period and that the remedy was ineffective. As discussed above, Plaintiffs have not alleged that they presented their vehicles to Ford within the warranty period to have the defective lug nuts replaced. For the same reasons that Plaintiffs fail to allege facts sufficientto state a claim upon which relief can be granted for breach of the express warranty, they also fail to state a claim that the limited remedy failed of its essential purpose. Claims 23, 32, 48, 52, 57, 73, 78, 82, 87, 95, and 101 must therefore be dismissed.
Furthermore, Temple v. Fleetwood Enters., Inc., 133 F. App'x 254, 268 (6th Cir. 2005). Claim 1 must also be dismissed.
Plaintiffs have not alleged facts sufficient to plead state-law fraud or consumer protection claims. Fraud claims and consumer protection claims sounding in fraud must meet the heightened pleading standard of Civil Rule 9(b). See Miller, 2018 WL 2740240, at *14 (quoting Spaulding v. Wells Fargo Bank, N.A., 714 F.3d 769, 781 (4th Cir. 2013)). For claims involving affirmative misrepresentations, Civil Rule 9(b) requires a plaintiff to allege "the time, place, and content of the alleged misrepresentation on which he or she relied; the fraudulent scheme; the fraudulent intent of the defendants; and the injury resulting from the fraud." Id. at *11 (quoting Cataldo v. U.S. Steel Corp., 676 F.3d 542, 551 (6th Cir. 2012)).
And for claims involving fraudulent omissions, Civil Rule 9(b) requires a plaintiff to plead "'the who, what, when, where, and how' of the alleged omission." Id. (quoting Republic Bank & Tr. Co. v. Bear Stearns & Co., 683 F.3d 239, 256 (6th Cir. 2012)). Specifically, a plaintiff pleading a fraudulent omission must allege "(1)precisely what was omitted; (2) who should have made a representation; (3) the content of the alleged omission and the manner in which the omission was misleading; and (4) what [defendant] obtained as a consequence of the alleged fraud." Id. (alteration in original) (citing Republic Bank & Tr. Co., 683 F.3d at 256). A complaint may suffice under the applicable standard if it alleges that a manufacturer knew of a defect before sale, the various venues the manufacturer used to sell the product failed to disclose the defect, and that the plaintiffs would not have purchased the product or would have paid less for it had they known of the defect. See Beck v. FCA US LLC, 273 F. Supp. 3d 735, 751-52 (E.D. Mich. 2017).
The Plaintiffs' complaint is devoid of any state-law fraud or consumer protection claims based on a misrepresentation theory. Plaintiffs simply have not pleaded any representations related to lug nuts.
As to Plaintiffs' fraudulent omissions theory, Plaintiffs insist that they pleaded, consistent with Beck, that Ford knew of the defect before the sale of the vehicles...
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