Judge: Daniel S. Murphy, Case: 21STCV45253, Date: 2022-09-19 Tentative Ruling

Case Number: 21STCV45253    Hearing Date: September 19, 2022    Dept: 32

Background

Plaintiffs Terry Hooper and Robert Everett Hooper (Plaintiffs) commenced this lemon law action against Defendant American Honda Motor Co., Inc. (Honda).   Plaintiffs allege that she purchased a 2019 Honda Odyssey (Vehicle) which contained or developed defects.  Plaintiffs asserts causes of action including fraud.

Demurrer

Honda demurrers to the following causes of action: 5^th Cause of Action – Fraud.

A.  Economic Loss Doctrine. 

Honda demurs to the Complaint’s 5^th Cause of Action – Fraud.  One of Honda’s contentions is that this cause of action fails because it is barred by the economic loss rule.  The Court agrees.

Economic loss consists of “damages for inadequate value, costs of repair and replacement of the defective product or consequent loss of profits—without any claim of personal injury or damages to other property.”  (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 988.)  The economic loss rule requires a purchaser to recover in contract for purely economic loss due to disappointed expectations, unless the purchaser “can demonstrate harm above and beyond a broken contractual promise,” such as some form of personal injury or damage to property other than the defective product itself.  (Ibid.)  The economic loss rule exists to prevent “the law of contract and the law of tort from dissolving one into the other.”  (Ibid.)

“[T]he economic loss rule is not a defense to a cause of action.  Rather, the existence of damages other than purely economic loss is an element of a plaintiff’s common law cause of action.”  (Greystone Homes, Inc. v. Midtec, Inc. (2008) 168 Cal.App.4th 1194, 1215; accord Rosen v. State Farm General Ins. Co. (2003) 30 Cal.4th 1070, 1079 (“Under the economic loss rule, ‘appreciable, nonspeculative, present injury is an essential element of a tort cause of action.’ ”).)

In this case, Plaintiffs have not alleged that they suffered any physical injury or that there was any physical damage to property other than to the Vehicle itself.  Plaintiff has alleged only economic loss.  For this reason, Plaintiff’s fraudulent concealment claim is barred by the economic loss rule.  The weight of authority within the Ninth Circuit concurs with this result.  (See, e.g., Sloan v. General Motors LLC (N.D. Cal., Apr. 23, 2020, No. 16-CV-07244-EMC) 2020 WL 1955643, at *23-*24 (Judge Chen) (collecting cases); Mosqueda v. American Honda Motor Company, Inc. (C.D. Cal., Mar. 6, 2020, No. SACV19839MWFMAAX) 2020 WL 1698710, at *13; Hsieh v. FCA US LLC (S.D. Cal., Feb. 20, 2020, No. 19-CV-01691 W (AHG)) 2020 WL 835310, at *3; Zagarian v. BMW of North America, LLC (C.D. Cal., Oct. 23, 2019, No. CV 18-4857-RSWL-PLA) 2019 WL 6111731, at *3; Thompson v. BMW of North America, LLC (C.D. Cal., Jan. 10, 2019, No. SACV 17-01912-CJC-KS) 2019 WL 988694, at *5.)  It should also be noted that Rattagan v. Uber, S272113, concerns fraudulent concealment and is pending before the California Supreme Court.

Honda’s demurrer to the 5^th Cause of Action is sustained without leave to amend.

Motion to Strike

            Honda moves to strike reference to punitive damages.  Honda’s request is well-taken.  Plaintiff cannot recover punitive damages on her Song-Beverly Act claims because the Song-Beverly Act provides for civil penalties, not punitive damages.  Where the Legislature expressly designates specific damage remedies while omitting others, the Legislature intends that the prescribed remedies are exclusive.  (Imperial Merchant Services, Inc. v. Hunt (2009) 47 Cal.4th 381, 390; see also Beach & Bluff Conservancy v. City of Solana Beach (2018) 28 Cal.App.5th 244, 262.)

            Honda’s motion to strike punitive damages is granted.

Conclusion

            Honda’s demurrer to the 5^th cause of action is SUSTAINED without leave to amend.

            Honda’s motion to strike punitive damages is GRANTED.

            Honda shall file an answer to the complaint within 10 days of this order.