Tentative Ruling

 

HEARING DATE: January 25, 2024

CASE NUMBER: 23TRCV00632 

CASE NAME: Shanika Pope v. General Motors, LLC, et al.

MOVING PARTY: Defendant, General Motors, LLC 

RESPONDING PARTY: Plaintiff, Shanika Pope 

TRIAL DATE: None set. 

 

MOTION: (1) Demurrer 

(2) Motion to Strike 

Tentative Rulings: (1) Defendants’ Demurrer is OVERRULED in part, and SUSTAINED in part.  

(2) Defendants’ Motion to Strike is MOOTED 

I. BACKGROUND

A. Factual

On March 3, 2023, Plaintiff, Shanika Pope (“Plaintiff”) filed this action against Defendant, General Motors, LLC (“Defendant”), and DOES 1 through 10. On June 16, 2023, Plaintiff filed a First Amended Complaint (“FAC”), as to which GM demurred resulting in leave to amend.   On November 8, 2023, Plaintiff filed a Second Amended Complaint (“SAC”) alleging causes of action for: (1) Violation of Civil Code § 1793.2(d); (2) Violation of Civil Code § 1793.2(b); (3) Violation of Civil Code § 1793.2(a)(3); (4) Breach of the Implied Warranty of Merchantability [Civil Code §§ 1791.1, 1794, 1795.5]; (5) Fraudulent Inducement; (6) Violation of Consumer Legal Remedies Act [Civil Code §§ 1750, et seq.]; and (7) Violation of the Magnuson-Moss Warranty Act  

 

On September 12, 2023, this Court SUSTAINED GM’s demurrer to the FAC as to the fifth cause of action for fraudulent inducement, but allowed leave to amend. GM moves again to demur as to this cause of action, and filed motion to strike portions of the SAC.  

B. Procedural 

 

On November 8, 2023, GM filed a Demurrer and Motion to Strike. On January 11, 2024, Plaintiff filed oppositions to both motions. On January 17, 2024, GM filed reply briefs to both oppositions.  

 

 

¿II. GROUNDS FOR DEMURRER & MOTION TO STRIKE  

 

Defendant demurs to Plaintiff’s Fifth cause of action for fraudulent concealment on the grounds that GM argues the cause of action is barred by the statute of limitations and fails to set forth sufficient facts to state a cause of action. Defendant also demurs to Plaintiff’s sixth cause of action for violation of the CLRA on the grounds it is barred by the statute of limitations and fails to state facts sufficient to state a cause of action for violation of the CLRA.  

 

A pleading is uncertain if it is ambiguous or unintelligible. (Code Civ. Proc., § 430.10, subd. (f).) A demurrer for uncertainty may lie if the failure to label the parties and claims renders the complaint so confusing defendant cannot tell what he or she is supposed to respond to.¿ (Williams v. Beechnut Nutrition Corp. (1986) 185 Cal.App.3d 135, 139, fn. 2.) However, “[a] demurrer for uncertainty is strictly construed, even where a complaint is in some respects uncertain, because ambiguities can be clarified under modern discovery procedures.” (Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 616.) 

 

Fraud – Fraudulent Inducement – Concealment  

Here, just as in the previous demurrer, GM argues that Plaintiff’s Fifth Cause of Action for Fraudulent Inducement – Concealment fails because it is barred by the statute of limitations, that it does not possess the requisite specificity, and that it fails to allege a transactional 

relationship between GM and Plaintiff that would give rise to a duty to disclose.  

 

 

 

 

Statute of Limitations 

 

For the statute of limitations issue, the Court notes that it has already held, in its ruling on GM’s previous demurrer, that Plaintiff’s allegations are sufficient to allege tolling. Plaintiff has not proven tolling as this is only a pleading motion and no evidence has yet been presented, so it remains to be seen whether plaintiff will have sufficient evidence to toll the running of the statute of limitations.  The Court does not need to relitigate this issue, and OVERRULES the demurrer with respect to this argument.  

 

Specificity Requirement  

 

 In the interest of the Court’s time and resources, the Court notes that it has previously found, in the ruling on GM’s demurrer to the FAC, that Plaintiff met the specificity requirements through its pleadings. GM makes the same argument here the Court did not find persuasive as to this aspect of GM’s demurrer, and again, is not persuaded by it now.  

 

Transactional Relationship 

 

In the previous demurrer, the issue with Plaintiff’s fifth cause of action came with the allegations as to the requisite transactional relationship to give rise to a duty to disclose. Here, Plaintiff again contends that a transactional relationship is not required under California law for the manufacturer to have a duty to disclose, relying on Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828. In Dhital, the Court found that the stated allegations were sufficient to survive a pleading attack, noting:  

 

At the pleading stage (and in the absence of a more developed argument by Nissan on this point), we conclude plaintiffs’ allegations are sufficient. Plaintiffs alleged that they bought the car from a Nissan dealership, that Nissan backed the car with an express warranty, and that Nissan’s authorized dealerships are its agents for purposes of the sale of Nissan vehicles to consumers. In light of these allegations, we decline to hold plaintiffs’ claim is barred on the ground there was no relationship requiring Nissan to disclose known defects. 

 

(Dhital v. Nissan, supra, 84 Cal.App.5th at 844.) Based on this, Plaintiff contends that at the pleading stage, its fraud allegations are sufficient.  

 

This Court notes that as LiMandri made clear, the second, third, and fourth circumstances giving rise to a duty to disclose “presuppose[] the existence of some ... relationship between the plaintiff and defendant.” (52 Cal. App. 4th at 336-37 (emphasis added).) For purposes of duties to disclose, the California Supreme Court has defined a “relationship” as a “transaction” between the parties. (Warner Constr. Corp. v. City of Los Angeles (1970) 2 Cal. 3d 285, 294; see LiMandri, 52 Cal. App. 4th at 337 (“As a matter of common sense, such a relationship can only come into being as a result of some sort of transaction between the parties.”) (emphasis in original).)  The Court notes that a transactional relationship test can be met indirectly, i.e., by virtue of an allegation that Plaintiff purchased the subject vehicle from an authorized GM dealer who is alleged to have acted as a sales agent for the manufacturer.  There is some support in published decisions for this argument, e.g., Dhital. The Court notes that the California Supreme Court granted review of Dhital, and thus, although not binding, its decision may be cited for its persuasive authority. The decision in Dhital found the allegations sufficient to overcome Nissan’s demurrer there.  ¿ 

Dhital states: “Plaintiffs alleged that they bought the car from a Nissan dealership, that Nissan backed the car with an express warranty, and that Nissan’s authorized dealerships are its agents for purposes of the sale of Nissan vehicles to consumers.” (Dhital, supra, 84 Cal.App.5th at 844 [emphasis added].) Similarly, here, Plaintiff alleges that he bought the vehicle from an authorized dealership of GM. (SAC, ¶ 6.) Plaintiff also alleges that GM provided an express written warranty. (SAC, ¶¶ 7, 13) covering the transmission defect and allegedly actively concealed the same, by virtue of its authorized dealership and agent’s purportedly fraudulent pre-sale conduct. (SAC, ¶¶ 65-80.) Although the Court views it as a close question, the persuasive authority in Dhital is more compelling than some less well reasoned and unpublished federal district court decisions that have granted motions for judgment on the pleadings or dismissed fraudulent concealment claims at the pleading stage.  

 

Next, Plaintiff also argues that GM had exclusive knowledge of the defect. The Court finds this to be alleged in the SAC: “GN acquired its knowledge of the Transmission Defect prior to Plaintiff acquiring the Vehicle, through sources not available to consumers such as Plaintiff, including but not limited to pre-production and post-production testing data; early consumer complaints about the Transmission Defect made directly to Defendant GM and its network of dealers; aggregate warranty data compiled from Defendant GM’s network of dealers; testing conducted by Defendant GM in response to these complaints; as well as warranty repair and part replacements data received by Defendant GM from Defendant GM’s network of dealers, amongst other sources of internal information.” (SAC. ¶ 68.) The problem, as discussed at the prior hearing, is that Plaintiff’s referenced TSBs are available to the public, which is a direct contradiction to the Plaintiff’s contention that GM and GM alone had exclusive knowledge of problems with transmission in other vehicles.   Arguably, if the absence of any reported repair issues were so material to a buyer that she would not have made the purchase had the pre-existing technical issues were known, Plaintiff would need to make specific allegations of efforts to learn about pre-existing reported repair issues, such as allegations of specific question at the point of sale and/or upon independent investigation.  The Court does not observe any such allegations here. However, instead, the SAC alleges that a Plaintiff, as a reasonable consumer who interacted with sales representatives, considered GM’s advertisement, and/or other marketing materials concerning GM Vehicles prior to purchasing the Subject Vehicle. She also alleges that a reasonable consumer would have considered the allegedly undisclosed history GM had experience with other customers’ complaints and data provided to GM by its dealers about transmission shifting would have considered them in deciding to purchase a GM product.  (SAC ¶¶ 76, 78.)   

 

But Plaintiff does not allege that GM knew that Plaintiff’s vehicle would experience the claimed transmission issue.  Plaintiff does not allege that every GM vehicle and every GM customer experienced such symptoms.  The SAC does not allege in a qualitative or quantitative way what percentage of GM vehicles sold in the same model year as Plaintiff’s actually experienced the claimed transmission issue.  In the absence of an allegation of bodily injury, property damage other than to the product itself, or death, the Court is not prepared to create a new legal duty that every manufacturer must disclose a repair issue seen in prior model year vehicles if only a certain percentage of such vehicles experienced the problem.   

 

Lastly, Plaintiff alleges that GM actively concealed material facts. (SAC, ¶¶ 37, 70, 73-74, 77-78, 80, 87, 91-92.) Plaintiff contends that GM committed fraud by knowingly and intentionally concealing from Plaintiff that the Vehicle and its Transmissions were defective, dangerous, and could suddenly and unexpectedly cause the driver to be unable to control the speed and acceleration/deceleration of the vehicle. (SAC, ¶ 67.) But the very issuance of publicly available TSBs demonstrates an absence of affirmative concealment.  Unless Plaintiff is alleging that the publicly available TSBs neglected to mention the nature of transmission issues Plaintiff himself experienced, the Court would be inclined to find that there could not be affirmative, active, intentional concealment of repair issues that are discussed in a published TSB.   The contention that GM has “superior knowledge” or was in a “superior position” to Plaintiff does not, in the Court’s view, satisfy the “exclusive” knowledge requirement giving rise to a duty to disclose. Every manufacturer and issuer of repair instructions has knowledge superior to a retail buyer about technical and repair issues. The mere existence of GM’s knowledge that some unspecified number of prior models have experienced customer complaints is not, in the Court’s view, sufficient to establish an affirmative duty to disclose the existence of such complaints to a later buyer or lessee for purposes of alleging a punitive damages cause of action for fraud in a warranty or economic loss case with no allegations of personal injury, property damage, or death.  In the Court’s view, it is for the Legislature, not the courts, to create such a new duty given its enormous ramifications for every consumer warranty claim in California.   

 

On balance, the Court finds that the SAC’s exceptionally detailed allegations are not sufficient to withstand demurrer for the reasons discussed above. Accordingly, the Demurrer is sustained once again to the fifth cause of action.    Plaintiff has been given multiple opportunities to amend this same cause of action.  Unless plaintiff articulates what additional facts can be alleged to overcome the concerns discussed in the demurrer and this tentative, the demurrer will be sustained WITHOUT leave to amend.   

 

Violation of Consumer Legal Remedies Act 

 

Preliminarily, GM makes the same statute of limitations argument as above. For the same reasons, this Court finds that Plaintiff has sufficiently alleged tolling in her SAC.  

 

The California Consumers Legal Remedies Act (CLRA), Civil Code section 1750 et seq., protects consumers from a broad range of unfair or deceptive business practices. Under the Act, in order to sue for money damages, a plaintiff must first provide the defendant with notice and a 30-day opportunity to cure the issue. (Civ. Code § 1782(a).) The consumer shall notify the defendant of the particular alleged violations of § 1770, and demand that the defendant correct, repair, replace, or otherwise rectify the goods or services alleged to violate § 1770. (Civ. Code § 1782(a)(1).) The notice must be in writing and must be sent by certified or registered mail, return receipt requested. (Civ. Code § 1782(a)(2).) However, an action for injunctive relief can be brought without complying with the notice requirements. (Civ. Code § 1782(d).)¿¿ 

 

Here, Plaintiff’s do not refute the argument that they have failed to comply with this notice requirement, but instead argues that GM’s argument is inappropriate for demurrer as it asks the Court to consider facts of the case outside of the pleading, and because Plaintiff has only asked for equitable and injunctive relief at this time. The Court agrees that even if Plaintiff failed to comply with the notice requirement necessary to seek damages, Plaintiff is still able to seek injunctive relief since notice is not required under Civil Code section 1782(d).¿However, as indicated it footnote 6 and paragraph 96, Plaintiff is only claiming equitable and injunctive relief under this cause of action at this time. Since Plaintiff’s CLRA claim seeking injunctive relief seems proper, the Court cannot sustain Defendant’s demurrer as to the third cause of action on this basis. (See Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 384-85 (“A demurrer is not the appropriate vehicle to challenge a portion of a cause of action demanding an improper remedy.”); PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682-83 (“A demurrer does not lie to a portion of a cause of action.”); see also Sheehan v. San Francisco 49ers, Ltd. (2009) 45 Cal.4th 992, 998 (stating that the sustaining of a demurrer may only be upheld if the complaint fails to state a cause of action under any possible legal theory).)

Thus, the Court overrules Defendant’s demurrer on this basis. 

 

Civil Code section 3294, subdivision (a) authorizes punitive damages in non-contract cases “where the defendant has been guilty of oppression, fraud, or malice.”

 

Here, GM bases its Motion to Strike Plaintiff’s prayer for Punitive Damages on the argument that Plaintiff has not pleaded the fraud cause of action as discussed in its demurrer. Plaintiff’s prayer for punitive damages, and Defendant’s argument against it, are intrinsically intertwined with the fraudulent inducement – concealment cause of action, and as such, the Court’s ruling as to the Motion to Strike is determined by the Court’s ruling of the demurrer. The Motion to Strike is thus mooted as the Court sustained the demurrer to the only cause of action for which punitive damages are alleged.