Judge: Ralph C. Hofer, Case: 24GDCV02457, Date: 2024-11-22 Tentative Ruling
Case Number: 24GDCV02457 Hearing Date: November 22, 2024 Dept: D
tenative ruling
Calendar: 5
Date: 11/22/2024
Case
No: 23
GDCV02457 Trial
Date: April 6, 2026
Case Name: Jackson-Wheeler
v. Volkwagen Group of America, Inc.
MOTION FOR SUMMARY ADJUDICATION
Moving Party: Defendant Volkswagen Group of
America, Inc.
Responding Party:
Plaintiff Justice Jackson-Wheeler
RELIEF REQUESTED:
Summary
adjudication as to the first and second causes of action, and plaintiff’s
claims for a civil penalty and attorneys’ fees.
75 Day Lapse: Yes
Separate Statements: Yes
CAUSES OF ACTION: from
Complaint
1)
Song-Beverly Act *
2)
Magnuson-Moss Act
3)
Breach of Express Warranty Under the California
Commercial Code
*Dismissed pursuant to Request for Dismissal entered
10/29/2024
SUMMARY OF FACTS:
Plaintiff Justice Jackson-Wheeler
alleges that plaintiff purchased a 2021 Volkswagen Jetta, and received an
express warranty from defendant Volkswagen Group of America, Inc., through
which Volkswagen Group of America, Inc. undertook to preserve or maintain the
utility or performance of the vehicle or provide compensation if there was a
failure in such utility or performance.
Plaintiff alleges that the vehicle
was delivered to plaintiff with serious defects and nonconformities to warranty
and developed other serious defects and nonconformities, including various
engine and fuel system defects.
Plaintiff alleges that the defects manifested themselves in the vehicle
within the applicable warranty period, and substantially impair the use, value,
or safety of the vehicle. Plaintiff
alleges that plaintiff delivered the vehicle to defendant’s authorized repair
facility to repair the nonconformities, but defendant has been unable to
conform the vehicle to warranty after a reasonable number of repair attempts.
Plaintiff alleges that
notwithstanding plaintiff’s entitlement, defendant manufacturer has failed to
either promptly replace the vehicle or to promptly make restitution.
Plaintiff also alleges that the
express warranty issued by the manufacturer constitutes a written warranty as
defined in the Magnuson-Moss Warranty Act.
Plaintiff alleges that in addition to the written warranty, an implied
warrant of merchantability was created under California law, and that defendant
violated the Magnuson-Moss Act when it breached the express warranty and
implied warranties by failing to repair the defects and nonconformities, or to
replace or repurchase the vehicle.
Plaintiff also alleges that the
failure to repair or properly repair the described defects, and the failure to
honor the warranty constitute a breach of warranty by defendant actionable
under the California Commercial Code.
The file shows that on October 29,
2024, after the filing of this motion, plaintiff filed a Request for Dismissal
with prejudice “as to Plaintiff’s First Cause of Action (Song-Beverly Act
claims, only).” The dismissal was entered
as requested the same date.
ANALYSIS:
Procedural
Request for Dismissal
As noted
above, on October 29, 2024, plaintiff filed a Request for Dismissal with
prejudice of the first cause of action in the complaint for relief under the
Song-Beverly Act.
The
opposition indicates that plaintiff’s counsel informed opposing counsel it
would dismiss the Song-Beverly cause of action on October 15, 2024, the
dismissal has been filed, and therefore, that cause of action will not be
addressed in the opposition.
Accordingly,
the court will not address the following two issues directed at the first cause
of action, as the dismissal of the cause of action renders the issues moot:
Issue 1—Defendant
is warranted summary adjudication of Plaintiff’s Song-Beverly Consumer Warranty
Act cause of action (First Cause of Action) because Plaintiff did not purchase
nor receive the Subject Vehicle in California.
Issue 3—Plaintiff
cannot maintain a viable Song-Beverly Cause of Action, so Defendant VWGoA is
entitled to summary adjudication as to Plaintiff’s Demand for a Civil Penalty.
Substantive
This leaves Issues Nos. 2 and 4 to
the extent they are directed to the second cause of action under the
Magnuson-Moss Act.
Under CCP § 437c(p)(2) a defendant
“has met his or her burden of showing that a cause of action has no merit if
the party has shown that one or more elements of the cause of action, even if
not separately pleaded, cannot be established, or that there is a complete
defense to the cause of action. Once the
defendant... has met that burden, the burden shifts to the plaintiff... to show
that a triable issue of one or more material facts exists as to the cause of
action or a defense thereto.”
CCP § 437c(f)(1) provides that “A
motion for summary adjudication shall be granted only if it completely disposes
of a cause of action, an affirmative defense, a claim for damages, or an issue
of duty.”
Defendant Volkswagen Group of
America, Inc. (Volkswagen) seeks to establish that there is a complete defense
to the second cause of action brought under the Magnuson-Moss Act.
Issue
2—Plaintiff’s Magnuson-Moss Act cause of action (Second Cause of Action) fails
because Plaintiff failed to comply with the statutory prerequisite of
exhausting the informal dispute resolution.
Defendant Volkswagen argues that
plaintiff failed to comply with the informal dispute resolution exhaustion
requirement mandated by the Magnuson-Moss Act before filing this action.
Defendant relies on 15 USC 2310(a),
which provides for remedies in consumer disputes, and states, in
pertinent part:
“(1) Congress hereby declares it to be its policy to encourage warrantors
to establish procedures whereby consumer disputes are fairly and expeditiously
settled through informal dispute settlement mechanisms.
(2) The [Federal Trade] Commission shall prescribe rules setting forth
minimum requirements for any informal dispute settlement procedure which is
incorporated into the terms of a written warranty to which any provision of
this chapter applies. Such rules shall provide for participation in such
procedure by independent or governmental entities.
(3) One or more warrantors may establish an informal dispute
settlement procedure which
meets the requirements of the Commission's rules under paragraph (2). If—
(A) a warrantor
establishes such a procedure,
(B) such procedure, and its implementation, meets the
requirements of such rules, and
(C) he incorporates in a written warranty a
requirement that the consumer resort to such procedure before pursuing any
legal remedy under this section respecting such warranty,
then (i) the consumer may not commence a civil action (other than a class
action) under subsection (d) of this section unless he initially resorts to
such procedure.”
15 USC 2310 subdivision (d) of the statute provides, in pertinent part:
“(d) Civil action by consumer for damages, etc.; jurisdiction; recovery
of costs and expenses; cognizable claims
(1) Subject to subsections (a)(3) and (e), a consumer who is damaged by
the failure of a supplier, warrantor, or service contractor to comply with any
obligation under this chapter, or under a written warranty, implied warranty,
or service contract, may bring suit for damages and other legal and equitable
relief—
(A) in any court of competent jurisdiction in any State or the District
of Columbia; or
(B) in an appropriate district court of the United States, subject to
paragraph (3) of this subsection.
Defendant argues that consistent
with the Act’s requirements, defendant maintains a third-party informal dispute
resolution process administered by the Better Business Bureau (the BBB Auto
Line program), which has been in place at all times material to this
dispute. [UMF Nos. 3, 4, and evidence
cited]. Defendant argues that the BBB
Auto Line program is recognized as an appropriate form of informal dispute
resolution under the Act’s requirements, citing L.
Zingerman, D.D.S., P.C. v. Nissan North America, Inc. (USDC, N.D. Ill. 2015) 2015 WL 1840952, *3. , in which the
federal district court for the Northern District of Illinois noted in
connection with a limited warranty offered by Nissan North America, Inc., that
“[t]he Better Business Bureau Auto Line is recognized as an appropriate form of
informal dispute resolution under the Act’s requirements.” As argued in the opposition, this decision
pertains to a warranty and program offered by a different company, many years
ago, and does not sufficiently establish that the program defendant Volkswagen
uses meets the requirements of the Act.
Defendant argues that Volkswagen
advises its consumers of the existence of this BBB Autoline program in its
written warranty by clearly and conspicuously disclosing all pertinent
information related to it, and that this provision of notice is further
evidenced by plaintiff’s knowledge of the process in having opened a claim.
[UMF Nos. 4, 5, and evidence cited; Lewis Decl., paras. 6, 9, Ex. E].
Defendant submits a copy of the 2021
Volkswagen Gasoline Engine Models USA Warranty and Maintenance booklet which defendant
indicates applies to the subject vehicle, which states, in a section entitled
“Consumer Protection Information: Informal Dispute Resolution Program: Informal
dispute mechanism:”
“Volkswagen participates in BBB
AUTO LINE, an arbitration program administered by the Council of Better
Business Bureaus (3033 Wilson Boulevard, Suite 600, Arlington, Virginia 22201).
If you have a problem arising under
any Volkswagen written warranty, we request that you bring it to Volkswagen's
attention. If we are unable to resolve it, you may file a claim with BBB
AUTOLINE. You are required to use the BBB AUTO LINE program before asserting in
court any presumption set forth in California Civil Code section 1793.22, and before
pursuing any legal remedy under 15 U.S.C. 2310(d) with respect to the New
Vehicle Limited Warranty. You are not required to use BBB AUTO LINE before
pursuing rights and remedies under any other Federal law. Depending on
individual State laws, you may or may not be required to use BBB AUTO LINE
before pursuing rights and remedies under your State's lemon law. The BBB AUTO
LINE program is free of charge to you, but there are some vehicle age and
mileage limitations, so please call BBB AUTO LINE for more details."
[Lewis Decl., Ex. E,
p. 5].
Defendant then argues that plaintiff
did not exhaust this informal resolution mechanism before filing this lawsuit,
as, although plaintiff initiated the BBB mechanism by opening a claim on August
8, 2023, on August 22, 2023, the BBB closed plaintiff’s case because plaintiff
failed to submit a signed Customer Claim Form.
[UMF Nos. 5, 6, and evidence cited; Lewis Decl., para. 12].
As pointed out by plaintiff in the opposition, this showing by defendant
does not clearly establish the application of this defense, as there is no sufficient
attempt to show that the program, and its implementation, meets the
requirements of the Commission’s rules, as required under 15 USC 2310(a)(3)(B),
set forth above.
Specifically, there is no evidence submitted to show that the program
complies with specific rules, such as those pertaining to the submission of a
claim, any requirement of a signed claim form, or the propriety of effectively
rejecting a claim on the basis a claim form is not signed, which is the factual
basis for this motion. There are no rules of the program submitted to be
reviewed by the court.
As noted above, plaintiff points out that the legal case authority relied
upon for defendant’s argument pertains to a warranty and program offered by a
different company, many years ago, and does not establish that the program
defendant Volkswagen used in 2023s meets the requirements of the Act.
Plaintiff also argues that a
representation that the BBB program is certified (which is not even mentioned
in the moving memorandum), is insufficiently supported, as it is made by a
declarant with no personal knowledge of such a process or its significance, and
in any case the certification mentioned by the witness appears to relate to
compliance with state law, not the federal Act.
Defendant has submitted a
declaration of Chris Lewis, a Senior Manager—Product Analysis Group of
defendant Volkswagen, who indicates that Lewis has reviewed Volkswagen’s
records, and states:
“I am familiar with VWGoA's participation in and status of the
Better Business Bureau ("BBB") Autoline program, which is a qualified
third-party dispute resolution program under the Song-Beverly Consumer Warranty
Act and the Magnuson-Moss Warranty Act.
At all times material to the dispute, VWGoA's BBB Autoline program was
compliant with California regulations relating to state certification with the
minimum requirements of the Federal Trade Commission for third-party dispute
settlement procedures as set forth in part 703 of Title 16 of the Code of
Federal Regulations. A true and correct copy of the Certificate Certified
Status from the State of California, Department of Consumer Affairs regarding
the Better Business Bureau’s Autoline Program for calendar year 2023 is
attached hereto as Exhibit ‘F’.”
[Lewis Decl., para.
7].
The attached certificate appears to
be from the California Department of Consumer Affairs, and attests that the
arbitration Certification Program of the Department has certified Volkswagen
and BBC Auto Line “to operate a state-certified
arbitration program in California.” [Ex.
F]. The certificate states that the APC
reviews programs annually, pursuant to California Business and Professions Code
and California Code of Regulations, and that “as of December 31, 2022, which is
the date of its most recent annual review, the ACP certifies that the
above-referenced program is in substantial compliance and retains its
certification to operate.” [Ex.
F].
The witness also states:
"The BBB Autoline organization
is independent from VWGoA. In California, the BBB Autoline undergoes
independent annual audits to ensure the BBB Autoline is in the required
compliance with the applicable California and federal regulations. At no time
in the past 15 years has VWGoA's third party dispute resolution program (the
BBB Autoline) been out of the required compliance with the applicable
California and federal regulations."
[Lewis Decl., para.
8].
Plaintiff has objected to these
materials, arguing that the witness has no personal knowledge concerning the
document generated by another entity, the Certificate, and the witness has not
set forth any facts stating how the witness is familiar with the process of
compliance with state and federal regulations, or the process or results of
annual audits. Defendant also objects
that the materials are based on hearsay, with no exception established, and
that the witness is offering an improper opinion on the ultimate legal issues
in this matter. These objections are
well-taken and are sustained.
Even if the court were to consider
the materials, it would not consider the witness’ opinions binding on the
ultimate legal issues in this matter, in effect, whether defendant had in place
in 2023 a procedure which procedure, and its
implementation, met the requirements of the Federal Trade Commission
Rules. As pointed out in the opposition,
the Certificate is issued by a Department of the State of California,
evidently certifies BBB Auto to operate a state-certified arbitration program
in California, because it remains in compliance, without mentioning compliance
with any federal requirements, only referring to California statutes and
regulations. [Ex. F]. Moreover, the Certificate is based on a
review concluded in 2022, before the events with plaintiff occurred in 2023.
To the extent this is an effort to establish each element of the
affirmative defense, the Second District recognizes that “A defendant
moving for summary judgment based on an affirmative defense must present
evidence that supports each element
of its affirmative defense, which would
also be its burden at trial.” Acosta
v. Glenfed Development Corp. (2005)
128 Cal.App.4th 1278, 1292-1293, italics in original, citation
omitted.
The showing here fails to establish that the program at issue complies
with the Commission rules as required under the Act, and defendant accordingly
has failed to meet its initial burden on this motion sufficient to shift the
burden to plaintiff to raise triable issues of material fact.
Even if the burden had been met,
plaintiff argues in the opposition that (1) defendant did not in fact have a
program which complied with applicable rules, and (2) plaintiff followed the
program, but defendant improperly failed to consider his claim.
Plaintiff relies on 16
CFR section 703.2 (b)(3), pertaining to the duties of a warrantor, which
provides,
“(b) the warrantor shall disclose clearly and
conspicuously at least the following information on the face of the written
warranty:…
(3) A statement of
any requirement that the consumer resort to the Mechanism
before exercising rights or seeking remedies created by Title I of the Act; together with the disclosure that if a
consumer chooses to seek redress by pursuing rights and remedies not created by
Title I of the Act, resort to the Mechanism would not be required by any
provision of the Act…”
Plaintiff also relies on 16 CFR section 703.1 (h), which provides the definitions
to be used in the Magnuson-Moss Warranty—Federal Trade Commission Improvement
Act, and states:
“(h) On the face of the warranty
means:
(1) If the warranty is a single sheet with
printing on both sides of the sheet, or if the warranty is comprised of more
than one sheet, the page on which the warranty text begins;
(2) If the warranty is included as part of a
longer document, such as a use and care manual, the page in such document on
which the warranty text begins.”
Plaintiff points out that the
document submitted with the moving papers, the USA Warranty and Maintenance
booklet, does not comply with these requirements, as the Consumer Protection
Information is not included “on the face of the warranty,” defined as “the page
in such document on which the warranty text begins.” The language relied upon by defendant appears
on page 5 of the Warranty and Maintenance document. [UMF No. 4; Ex. E, p. 5]. That page of the document includes no language
which sets forth text of a warranty. The
reply concedes that the warranty text begins on page 8 of that document, as
confirmed by the Table of Contents, not the same page. [Ex. E, p. 8, Table of Contents]. This situation raises issues with respect to
whether the notice complies with the Act, as the warrantor has not disclosed
the information “on the face of the written warranty” as required under 16 CFR
section 703.2 (b).
Plaintiff cites to case law, Freas v. BMW of North America, LLC
(USDC S.D.Cal 2018) 320 F.Supp.3d 1126, 1133-1134, in which the District Court for the Southern
District of California, in reliance on the above stated Rules, rejected an argument that a lawsuit by
a consumer should be dismissed because the consumer did not resort to the Auto
Line program in California before filing suit.
The district court set forth the above rule and definition, and
concluded:
“Here, it is undisputed that BMW's written warranty begins on page 26 of
its 2011 7 Series Service and Warranty Information Booklet. (Doc. No. 33-1 at ¶
11.) It is likewise undisputed that page 26 contains none of the information
required by 16 C.F.R. § 703.2(b); rather, that information is provided on page
22 of the booklet. (Id. at ¶ 10.) Because BMW failed to provide the information
required by 16 C.F.R. § 703.2(b) “on the face of the written warranty,” as
defined by federal law, Freas was not required to use AUTO LINE before filing
this suit.
BMW asks the Court to excuse its technical noncompliance with the FTC's
regulations and asserts that there “is no authority to support [Freas']
draconian interpretation of [16 C.F.R. § 703.2(b)'s] disclosure requirements.”
(Doc. No. 33 at 18.) However, Magnuson-Moss itself expressly provides that a
consumer is only required to pursue an informal dispute settlement procedure
prior to filing suit if “such procedure, and its implementation, meets the
requirements of [the FTC's] rules[.]” 15 U.S.C. § 2310(a)(3)(B) (emphasis
added); see also id. § 2310(a)(2) (giving the FTC the authority to “prescribe
rules setting forth minimum requirements for any informal dispute settlement
procedure which is incorporated into the terms of a written warranty”). Because
Congress has conditioned the informal dispute settlement requirement on the
warrantor's compliance with FTC rules, it would be inappropriate for the Court
to excuse BMW's failure to fully adhere to 16 C.F.R. § 703.2(b). See, e.g.,
Henson v. Santander Consumer USA Inc., ––– U.S. ––––, 137 S.Ct. 1718, 1725, 198
L.Ed.2d 177 (2017) (“[I]t is [the courts'] job to apply faithfully the law
Congress has written[.]”). Moreover, as the Third Circuit has explained, “the
FTC regulations promulgated to guide providers of alternative dispute
resolution mechanisms are slanted toward the consumer: consumers must comply
with only minimal requirements, while the warrantors must follow more elaborate
and more burdensome rules[.]”
Freas, at 1133-1132.
Plaintiff also cites to Carillo
v. BMW of North America, LLC (USDC C.D. Cal. 2021) 543 F.Supp.3d 856, 862
in which the District Court for the Central District of California applied the
statutes, and the reasoning of Freas, where the disclosure of the BBB
Auto Line program was on pages 16 to 18 of a Service and Warranty information
booklet, and the section explaining the relevant warranties began on the page
after the disclosures ended, emphasizing that:
“the statute clearly states that the
disclosure must be “[o]n the face of the warranty,” which is on “the page in
such document on which the warranty text begins.” 16 C.F.R. § 703.1(h)(2). That
language is unambiguous and
BWW clearly does not comply. Carrillo was therefore not required to exhaust the
internal resolution procedure.”
Because the information regarding BBB Auto Line was not on the first page
of any of the warranties outlined in the Booklet, Carrillo was not required to
exhaust the informal dispute resolution procedure, and his claim is not barred.”
Carillo, at 861-863.
This scenario is the same situation
established here, and similarly, because the information regarding BBB Auto
Line was not on the first page of the warranty section in the booklet,
plaintiff was not required to exhaust the informal dispute resolution
procedure, and the claim is not barred.
The reply seems to argue that since the information regarding the BBB
Autoline process appears on pages immediately preceding the warranty, these
cases are distinguishable. There is no
question the language relied upon is on page 5 of the booklet, and the warranty
language begins on page 8. As the cases
emphasize, the language of the act requiring the disclosure to be on “the page
in such document on which the warranty text begins,” is unambiguous.
Plaintiff sufficiently has raised triable
issues of material fact, or justified a finding that as a matter of law the
warranty is not in compliance with applicable FTC Rules.
Plaintiff also argues that the information is not disclosed clearly and
conspicuously, as the language of the consumer protection information, as set
forth above, confusingly states that “If we are unable to resolve [a problem],
you may file a claim with BBB AUTO LINE.” [Lewis Decl., Ex. E, p. 5]. Plaintiff argues
that the use of the word “may” suggests that filing a claim is optional. There is a sentence following which states,
“You are required to use the BBB AUTO LINE program…before pursuing any legal remedy
under 15 USC 2310(d),” but plaintiff argues that the paragraph is confusing
given the previous language, and so the warranty does not in any case include
“clearly and conspicuously,” the required, “statement
of any requirement that the consumer resort to the Mechanism before exercising
rights or seeking remedies created by Title I of the Act.”
This outcome further supports the denial of the motion.
Plaintiff
also calls into question the propriety of the handling of plaintiff’s claim,
which the moving papers concede was submitted but the claim was closed. The moving papers indicate that on or about August 8, 2023, plaintiff
attempted to participate in the BBB Autoline program by opening a claim. [UMF No. 5, and
evidence cited; Lewis Decl., para. 12, Ex. G].
Exhibit G appears to be a claim form which is fully completed, although
there is no signature at the signature line.
The
motion indicates that on August 22, 2023, BBB closed plaintiff’s claims for
failure to submit a Customer Claim Form.
[Lewis Decl., para. 13, Ex. H].
The letter states, “We have determined that your case is outside the
jurisdiction of the BBB AUTO LINE program because we have not received your
signed Customer Claim Form. Your case has been closed.” [Ex. H].
The letter also states, “If you wish to proceed through BBB AUTO
LINE,
please return your
Customer Claim Form, and a new case will be opened.” [Ex. H].
It is not
clear from this letter that only a signature was missing, and it clearly
represents that a new case can be opened on further submission.
Again, defendant has made no
argument or submitted any terms of the informal arbitration process which would
require that a claim be signed, and allow a case to be closed without allowing
an opportunity to correct the omission.
Plaintiff in opposition submits the
declaration of plaintiff’s counsel, Karl Heil, who indicates that:
“After receiving a letter from the BBB claiming that it had not received
a signed copy of the claim and stating that the claim was closed, my office
successfully resubmitted Plaintiffs claim through the BBB's online claim
initiation process on August 29, 2023. A true
and accurate copy of the confirmation showing that the claim was
successfully submitted is included with the opposition papers as Exhibit 1.
3. Based on my experience, after a claim is successfully submitted, the
BBB then provides my office with a claim form to complete. Here, for example,
when a claim was first submitted on August 7, 2023, the BBB provided my office
with a claim form to complete.
4. However, when the claim was reinitiated successfully on August 29,
2023, the BBB failed to send my office a claim form or otherwise respond to the
August 29, 2023, claim.
5. Because the BBB failed to provide a claim form after nearly a month, I
sent the BBB a signed copy of the previous claim form in an attempt to prod the
BBB to conduct an arbitration hearing promptly.”
[Heil Decl., paras. 2-5, Exs. 1, 2; Additional Facts Nos. 2-7].
The copy of the claim and supporting
documents is submitted, and appears quite thorough, and attaches various
documentation in support of the claim.
[Ex. 2]
Counsel indicates that despite delivery confirmation and all efforts,
“the BBB never responded” to counsel’s communications or the signed claim form
and supporting documents submitted, “or took any action on the claim.” [Heil
Decl., paras. 10, 11; Additional Facts Nos. 8, 9].
Plaintiff argues that this raises triable issues of material fact
concerning whether plaintiff failed to seek informal resolution of this matter
prior to filing suit, or whether the program provided by defendant complied
with the FTC rules. It would appear that
a trier of fact could reasonable find that this type of procedure, offering to
reopen a case, and then failing to respond to documents to do so, is not a
procedure, or an implementation, which met the requirements of the Federal
Trade Commission Rules.
Specifically, plaintiff relies on 6 CFR 703.5, pertaining to operation of the mechanism, which
provides, at subdivision (d), in pertinent part:
“(d) If the dispute has not been settled, the
Mechanism shall, as expeditiously as possible but at least within 40 days of
notification of the dispute, except as provided in paragraph (e) of this
section:
(1) Render a fair decision based on the
information gathered as
described in paragraph (c) of this section, and on any information submitted at
an oral presentation which conforms to the requirements of paragraph (f) of
this section (A decision shall include any remedies appropriate under the
circumstances, including repair, replacement, refund, reimbursement for
expenses, compensation for damages, and any other remedies available under the
written warranty or the Act (or rules thereunder); and a decision shall state a
specified reasonable time for performance);
(2) Disclose to the warrantor its decision and the reasons therefore;
(3) If the decision would require action on the part of the warrantor,
determine whether, and to what extent, warrantor will abide by its decision;
and
(4) Disclose to the consumer its decision, the reasons therefor,
warrantor's intended actions (if the decision would require action on the part
of the warrantor), and the information described in paragraph (g) of this
section….”
Plaintiff argues that it had been
beyond the 40 day time window for BBB Autoline to respond to the August 29,
2023 submission, which expired on October 9, 2023, when this action was filed
on November 20, 2023. This showing
establishs a failure to timely render a decision, and a violation of the Rule.
Triable issues of fact have been raised. The motion on this issue is
denied.
Defendant in the reply argues for the first time that because the
Song-Beverly Act claims have been dismissed, the Magnuson Moss Act cause of
action fails. This argument is improper,
as the argument is raised only
in the reply papers, so plaintiff has not had the
opportunity to respond to this argument.
Balboa Ins. Co. v.
Aguirre (1983) 149 Cal.App.3d. 1002,
1010.
The issue is also not specifically
identified in the notice of motion, as required under the summary judgment
procedures, giving rise to due process concerns. See CRC Rule 3.1350(b)
The reply offers no explanation
concerning why this argument could not have been raised earlier, and there
appears to no good cause, as defendant had moved for summary adjudication of
the Song Beverly Act cause of action and could easily have argued that because
the Song Beverly Act cause of action failed, the Magnuson-Moss Act claims also
failed. This procedure was not done
here, and this argument offered for the first time in the reply is not
considered by the court.
Issue 4—Plaintiff
cannot maintain a viable Song-Beverly Act or Magnuson-Moss causes of action, so
Defendant VWGoA is entited to summary adjudication as to Plaintiff’s demand for
attorneys’ fees.
As
discussed above, triable issues of fact remain with respect to whether
defendant can establish its affirmative defense that plaintiff failed to comply
with a prerequisite to filing an action under the Magnuson-Moss Act, so triable
issues remain with respect to whether plaintiff can maintain a viable cause of
action and a claim for statutory attorney’s fees under the Magnuson-Moss
Act. As set forth above, 15 USC 2310 subdivision (d) of the Act,
provides at subdivision (2):
“(2) If a consumer finally prevails in any action brought under paragraph
(1) of this subsection, he may be allowed by the court to recover as part of
the judgment a sum equal to the aggregate amount of cost and expenses
(including attorneys' fees based on actual time expended) determined by the
court to have been reasonably incurred by the plaintiff for or in connection
with the commencement and prosecution of such action, unless the court in its
discretion shall determine that such an award of attorneys' fees would be
inappropriate.”
The motion is accordingly denied.
In
addition, the issue, pertaining to plaintiff’s “demand for attorney’s fees,” is
not an appropriate one for summary adjudication.
As set
forth above, CCP
§ 437c(f) provides that “a
motion for summary adjudication shall be granted only if it completely disposes
of a cause of action, an affirmative defense, a claim for damages, or an issue
of duty.”
A motion to adjudicate a demand for
attorney’s fees does not dispose of a cause of action or a claim for
damages.
In fact, even if a claim for attorney’s fees were to be considered a
claim for damages, CCP § 437c(f)(1) provides “a party may move for
summary adjudication as to ... one or more claims for damages ... if that party
contends ... that there is no merit to a claim for damages, as specified in
Section 3294 of the Civil Code,...”
Section 3294 of the Civil Code
specifically addresses only punitive damages:
“(a) In an action for the breach of an
obligation not arising from contract, where it is proven by clear and
convincing evidence that the defendant has been guilty of oppression, fraud, or
malice, the plaintiff, in addition to the actual damages, may recover damages
for the sake of example and by way of punishing the defendant.”
The Second District has accordingly
held that this portion of the summary adjudication statute applies only to
punitive damage claims and that the statute does not permit summary
adjudication of other claims for damages which do not dispose of an entire
cause of action. DeCastro West
Chodorow & Burns, Inc. v. Superior Court (1996) 47 Cal.App.4th 410.
In fact, the summary judgment
statute was amended in 2011 to add a subdivision permitting summary
adjudication of other issues only under specified circumstances. That subdivision as currently effective, CCP
§ 437c (t), requires that a party may move for summary adjudication of a legal
issue or claim for damages that does not completely dispose of a cause of
action, but that before filing such a motion, the parties must submit to the
court a joint stipulation stating the issues to be adjudicated, and a
declaration from each party that the motion will further the interests of
judicial economy with specified grounds, and obtain from the court a
determination with respect to whether the court will allow the filing of the
motion. In addition, a specified
statement must be contained in the notice of motion, which must be signed by
all counsel for all parties. CCP section
437c(f)(4)(A) and (B).
No such
stipulation was filed, and no court determination was obtained here. Hence, the
notice does not conform with the subdivision.
The motion accordingly improperly is made for “partial” summary judgment
or adjudication. It is denied as to this argument.
RULING:
Defendant Volkswagen
Group of America, Inc.’s Motion for Summary Adjudication of the Issues:
Motion is DENIED. Defendant has failed to meet its initial
burden of establishing each element of its affirmative defense, as there is
insufficient admissible evidence presented to establish that the warranter has
shown that its informal dispute settlement procedure, and its implementation,
meets the requirements of the Commission’s rules, as required under 15 USC
2310(a)(2). The case law cited, and the
admissible evidence submitted, fails to sufficiently establish this essential
element of a defense under 15 USC 2310.
Even if the burden had shifted, plaintiff has
raised triable issues of material fact with respect to whether the informal dispute settlement procedure and its
implementation meets the requirements of the Commission’s rules, as defendant
has failed in its warranty booklet to comply with 16 CFR section 703.2 (b),
requiring specific information to be disclosed clearly and conspicuously “on
the face of the written warranty,” defined under 16 CFR section 703.1 (h) as “the page…on which
the warranty text begins.” A review of
the warranty documentation submitted by defendant shows that the information
concerning the program is on a different page than the text of the
warranty. [Lewis Decl., Ex. E, Table of
Contents, p. 5, p. 8]; Freas v. BMW of North America, LLC (USDC S.D.Cal 2018)
320 F.Supp.3d 1126, 1133-1134; Carillo v. BMW of North America, LLC (USDC C.D.
Cal. 2021) 543 F.Supp.3d 856, 862-864.
Triable issues have also been raised as to
whether the requirement to resort to the informal dispute settlement procedure
is disclosed “clearly and conspicuously,” as required under 16 CFR section
703.2 (b)(3), as the language is confusing and ambiguous, including the use of
the word “may” in connection with the use of the informal dispute settlement
procedure. [Lewis Decl., Ex. E, p. 5].
Triable issues of fact have also been raised
with respect to whether plaintiff made
sufficient efforts to use the informal dispute settlement procedure, and
whether plaintiff’s claim was properly handled.
It is undisputed the plaintiff submitted a claim, which was then closed.
[UMF No. 5, and evidence cited; Lewis Decl., para. 12, 13, Exs. G, H]. The letter submitted with the moving papers
informing plaintiff that the case had been closed states, “We have determined
that your case is outside the jurisdiction of the BBB AUTO LINE program because
we have not received your signed Customer Claim Form. Your case has been closed….
“If you wish to proceed through BBB AUTO LINE, please return your
Customer Claim Form, and a new case will be opened.” [Ex. H]. Plaintiff has submitted evidence that
plaintiff then returned a signed Customer Claim Form, but a new case was
evidently not opened, and there was no response to the new submission, and no
action taken on the claim. [Additional Facts Nos. 2-9, and evidence cited;
Heil Decl., paras. 2-11, Exs. 1, 2].
This showing supports a reasonable inference that the procedure followed
was improper, and in violation of t he Commission’s rules, including 6 CFR
703.5 (d), which requires that the informal dispute mechanism, shall
“expeditiously,” and “at least within 40 days of notification of the dispute”
“render a fair decision based on the information gathered...”
Issue
3—Plaintiff cannot maintain a viable Song-Beverly Cause of Action, so Defendant
VWGoA is entitled to summary adjudication as to Plaintiff’s Demand for a Civil
Penalty.
Motion is NOT CONSIDERED BY THE COURT, as the
Request for Dismissal of the first cause of action with prejudice entered as
dismissal on October 29, 2024 renders the motion on this issue MOOT.
Issue 4—Plaintiff cannot maintain a viable
Song-Beverly Act or Magnuson-Moss causes of action, so Defendant VWGoA is
entited to summary adjudication as to Plaintiff’s demand for attorneys’ fees.
Motion is
DENIED.
Triable issues of
fact have been raised with respect to the viability of the Magnuson-Moss cause
of action, as discussed in connection with Issue 2, above. In addition, this issue is not properly
subject to summary adjudication, as it does not completely dispose of a cause
of action, an affirmative defense, a claim for damages, or an issue of duty, as
required under CCP § 437c(f).
Plaintiff’s Objections to the Declaration of Chris Lewis and
Defendant’s Evidence (Exhibit F):
Objections Nos. 1, 4, 5 and 6 are OVERRULED. The Court notes that it has not considered
any testimony on the ultimate issues in this matter, including whether the
written warranty “clearly and conspicuously discloses” certain matters, binding
on the Court.
Objections Nos. 2 and 3 are SUSTAINED.
Defendant Volkwagen Group of America, Inc.’s Evidentiary
Objections to Declaration of Karl Heil in Support of Plaintiff’s Opposition to
Defendant’s Motion for Summary Adjudication of the Issues are OVERRULED.
Plaintiff’s Objection to Defendant’s Reply Separate
Statement and New Argument Made in its Reply to Plaintiff’s Opposition to
Defendant’s Motion for Summary Adjudication is NOT CONSIDERED BY THE
COURT. The document appears to be a
Sur-Reply, which is not authorized, and plaintiff failed to obtain advance
permission of the Court to file such further briefing.
DEPARTMENT D IS CONTINUING
TO CONDUCT AND ENCOURAGE
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