Judge: Jon R. Takasugi, Case: 24STCV33073, Date: 2025-04-04 Tentative Ruling

Case Number: 24STCV33073    Hearing Date: April 4, 2025    Dept: 17

Superior Court of California

County of Los Angeles

DEPARTMENT 17

TENTATIVE RULING

            FCA’s demurrer is OVERRULED IN PART, SUSTAINED IN PART. FCA’s demurrer is SUSTAINED, WITHOUT LEAVE TO AMEND, as to the sixth cause of action. FCA’s demurrer is OVERRULED as to the remaining claims.

            FCA’s motion to strike is GRANTED.

On 12/16/2024, Plaintiff Julie Braza (Plaintiff) filed suit against FCA US, LLC, and Cerritos Dodge Chrysler Jeep Ram (Cerritos DCJR), alleging violations of the Song-Beverly Warranty Act.

            On 2/5/2025, FCA, US, LLC (Defendant) demurred to Plaintiff’s Complaint. Defendant also moves to strike portions of Plaintiff’s Complaint.

Discussion

            Defendant argues that Plaintiff’s claims are: (1) time-barred pursuant to Code of Civil Procedure (CCP) section 338(d), Civil Code section 1791.1(c) and Commercial Code section 2725; and (2) that the sixth cause of action for concealment fails to set forth sufficient facts to constitute a cause of action against FCA as Plaintiff fails to allege (a) specific facts meeting the heightened pleading standard for fraud, (b) a duty of disclosure owed by FCA or (c) any basis for recovery outside the Economic Loss Doctrine.

            As for the contention that Plaintiff’s claims are time barred, Plaintiff purchased the vehicle on 11/23/2018. Thus, her warranty-based claims expired 11/23/2022. Plaintiff filed this action on December 12/16/2024, more than six years after delivery of the vehicle. However, Plaintiff alleges that she “discovered Defendants' wrongful conduct alleged herein shortly before the filing of the complaint, as the Vehicle continued to exhibit symptoms of defects following FCA's unsuccessful attempts to repair them.” (Complaint ¶ 38.) Whether or not Plaintiff did, in fact, only discover the facts supporting her claim shortly before filing this claim, or whether Plaintiff should have discovered these facts earlier, are factual determinations not properly made at this stage. As such, under any of the applicable statutes, Plaintiff has alleged sufficient facts at the pleading stage which could show her claims are not time-barred on their face.

            As for the contention that Plaintiff’s claim for concealment is insufficiently pled, the Court disagrees.

            Here, Plaintiff alleges that Defendant knew:

since prior to Plaintiff purchasing the Subject Vehicle, that the 2017 Jeep Grand Cherokee vehicles equipped with the 3.6L engine have one or more defects that can result loss of power, stalling, engine running rough, engine misfires, failure or replacement of the engine (the "Engine Defect").

…

Defendant knew or should have known, based on FCA's routine monitoring of complaints, that the 2017 Jeep Grand Cherokee vehicles have a dangerous defect that adversely affects their drivability. Additionally, FCA knew or should have known about the Engine Defect through sources not available to consumers, including FCA's own aggregate pre-market data and other aggregate post-market data from FCA authorized dealers.

CA was inundated with complaints regarding the Engine Defect but rather than repair the problem under warranty, FCA dealers either inform consumers that their vehicles are functioning properly or conduct repairs that merely mask the defect.

            (Complaint ¶ 16, 23-26.)

As such, Plaintiff alleges specific facts which could show Defendant knew about the defects in 2017 Jeep Grand Cherokee vehicles equipped with the 3.6L engine, based on aggregate pre-market data and other aggregate post-market data from FCA authorized dealers.

While Defendant contends that Plaintiff has not sufficiently alleged facts of the identities of the individuals who allegedly concealed this information, or which could establish Defendant’s knowledge of defects at the time of purchase, access to this specific information is clearly contemplated by the discovery process. Indeed, it is nearly impossible to imagine how Plaintiff could have access to those facts without the benefit of discovery. Rather, it is sufficient that Plaintiff has alleged facts which, accepted as true, could state a claim for concealment.

Moreover, the Court finds sufficient facts have been alleged to show a duty to disclose. A duty to disclose can arise from three circumstances: (1) the defendant had exclusive knowledge of the material fact; (2) the defendant actively concealed the material fact; or (3) the defendant made partial representations while also suppressing the material fact. (Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 311; LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336.) However, “[t]hese three circumstances, however, ‘presuppose[ ] the existence of [a] relationship between the plaintiff and defendant in which a duty to disclose can arise.’” (Bigler-Engler, supra, 7 Cal. App.5th at 311.0

“Such a transaction must necessarily arise from direct dealings between the plaintiff and defendant; it cannot arise between the defendant and the public at large.” (Bigler-Engler, supra, 7 Cal.App.5th at 311, emphases added.)

Here, Defendant manufactured the Vehicle purchased by Plaintiff, provided warranties to Plaintiff on behalf of that Vehicle, and attempted repair on Plaintiff’s vehicle pursuant those warranties. As such, the Court finds direct dealings between Plaintiff and Defendant sufficient to give rise to a duty to disclose.

However, the Court agrees that Plaintiff’s claim is barred by the economic loss doctrine, as Plaintiff seeks purely economic damages allegedly sustained from the purchase of the Subject Vehicle. In other words, Plaintiff alleges she would not have purchased the vehicle or would have paid significantly less for it. (Complaint, ¶¶ 21, 24, 69-71.)

The California Supreme Court’s recent decision in Rattagan v. Uber Techs., Inc. (2024) 17 Cal.5th 1, 553 P.3d 1213 clarifies that fraudulent concealment claims are permissible only where the concealed information exposes plaintiffs to risks or harms beyond the reasonable contemplation of the contractual relationship. (Id. at 13, 31.) For example, the Rattagan plaintiff alleged reputational and personal harm, including arrest and public vilification, resulting from Uber’s intentional concealment during their contractual relationship—harms that extended far beyond economic loss tied to the contract. By contrast, Plaintiff here alleges no such independent harm. Plaintiff’s allegations relate solely to contractual grievances about vehicle performance and warranty obligations.

The California Supreme Court’s recent dismissals of Dhital v. Nissan North America, Inc. and Kia America, Inc. v. Superior Court (Kia) on December 18, 2024 further reinforce the application of the ELD to bar claims like Plaintiff’s. In Dhital, the plaintiffs alleged fraudulent concealment based on the manufacturer’s pre-sale knowledge of vehicle defects obtained through consumer complaints, warranty data and other sources. Similarly, Kia involved allegations of presale concealment where plaintiffs claimed the automaker failed to disclose known defects in its vehicles. The dismissals of these cases suggest that the California Supreme Court did not find unresolved or novel legal issues warranting further review, particularly in light of its recent decision in Rattagan, which clarified the application of the economic loss doctrine to fraudulent concealment claims. Together, these dismissals reinforce Rattagan as the paramount authority governing the economic loss doctrine.

Based on the foregoing, Defendant’s demurrer is overruled in part, sustained in part. Defendant’s demurrer is sustained, without leave to amend, as to the sixth cause of action. Defendant’s demurrer is overruled as to the remaining causes of action.

Motion to Strike

            Defendant argues that Plaintiff cannot support a prayer for punitive damages.

            The Court agrees.

            As set forth above, the Court sustained Defendant’s demurrer, without leave to amend, as to the fraud cause of action. Thus, Plaintiff has not alleged specific facts which could show malice, oppression, or fraud.

            Based on the foregoing, Defendant’s motion to strike is granted.

It is so ordered.

Dated:  March    , 2025

   Hon. Jon R. Takasugi
   Judge of the Superior Court

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