Judge Teresa A. Beaudet, Case Number: 22STCV19947, Date: 2024-03-21 Tentative Ruling

MARCO DURAN,

Plaintiff,

vs.

MERCEDES-BENZ USA, LLC, et al.,

Defendants.

Case No.:

22STCV19947

Hearing Date:

March 21, 2024

Hearing Time: 2:00 p.m.

[TENTATIVE] ORDER RE:

DEFENDANT MERCEDES BENZ USA LLC’S MOTION FOR SUMMARY ADJUDICATION AS TO PLAINTIFF’S CLAIM FOR CIVIL PENALTY

Plaintiff Marco Duran (“Plaintiff”) filed this action on June 20, 2022 against Defendant Mercedes-Benz USA, LLC (“Defendant”). The Complaint alleges causes of action for (1) breach of implied warranty of merchantability under the Song-Beverly Act, and (2) breach of express warranty under the Song-Beverly Act.

In the Complaint, Plaintiff alleges that on October 17, 2019, he purchased a new 2019 Mercedes-Benz Sprinter, VIN WD3PF1CD8KT006349 (the “Vehicle”). (Compl., ¶ 5.) Plaintiff alleges that “[b]y way of example, and not by way of limitation, Plaintiff has presented the Vehicle to Defendants for repairs of defects, malfunctions, misadjustments, and/or nonconformities related to: (a) the suspension system producing a clanking noise while driving and turning; (b) recalls: #2019120007, #2020030012, #2020030013, #2020040019, #2020040009, #2020040023, #2020080012, #2021050005, and #2021070023; (c) the brakes creating an abnormal squeaking noise; (d) the illumination of the ‘Check Engine’ warning light on three (3) separate occasions; (e) the engine on four (4) separate occasions hesitating and leaking oil; (f) acceleration issues on two (2) separate occasions; (g) the Vehicle lacking power on four (4) separate occasions; (h) the illumination of the ‘Brake Pad’ warning light; and (i) the HVAC system producing a growling noise.” (Compl., ¶ 11.) Plaintiff alleges that “Defendants or their representatives failed to conform the Vehicle to the applicable warranties because said defects, malfunctions, misadjustments, and/or nonconformities continue to exist even after a reasonable number of attempts to repair was given.” (Compl., ¶ 13.)

Defendant now moves “for summary adjudication as to Plaintiff’s request for an award of civil penalties for Breach of Express Warranty based on the Song-Beverly Act…” Plaintiff opposes.

“[A] motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 437c, subd. (c).) “A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has no merit, that there is no affirmative defense to the cause of action, that there is no merit to an affirmative defense as to any cause of action, that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs. 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.” (Code Civ. Proc., § 437c, subd. (f).)

The moving party bears the initial burden of production to make a prima facie showing that there are no triable issues of material fact. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) If the moving party carries this burden, the burden shifts to the opposing party to make a prima facie showing that a triable issue of material fact exists. (Ibid.) Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.” (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.)¿

In the second cause of action for breach of express warranty under the Song-Beverly Act, Plaintiff alleges, inter alia, that “Plaintiff hereby gives written notice and makes demand upon Defendants for replacement or restitution, pursuant to the Song-Beverly Act. Defendants and each of them, knowing their obligations under the Song-Beverly Act, and despite Plaintiff’s demand, failed and refused to make restitution or replacement according to the mandates of the Song-Beverly Act. The failure of Defendants, and each of them, to refund the price paid and payable or to replace the Vehicle was intentional and justifies an award of a Civil Penalty in an amount not to exceed two times Plaintiffs actual damages.” (Compl., ¶ 32.)

“[The Song-Beverly Consumer Warranty Act (the ‘Act’)] provides that a buyer who is damaged by a failure to comply with their obligations under the Act, or under an implied or express warranty, may bring an action for damages and other legal and equitable relief. (Civ. Code, § 1794, subd. (a).) ‘If the buyer establishes that the failure to comply was willful, the judgment may include, in addition to the amounts recovered under subdivision (a), a civil penalty which shall not exceed two times the amount of actual damages. . . .’ (§ 1794, subd. (c).).” (Schreidel v. American Honda Motor Co. (1995) 34 Cal.App.4th 1242, 1249.) “In regard to the willful requirement of Civil Code section 1794, subdivision (c), a civil penalty may be awarded if the jury determines that the manufacturer knew of its obligations but intentionally declined to fulfill them. There is no requirement of blame, malice or moral delinquency. However, . . . a violation is not willful if the defendant’s failure to replace or refund was the result of a good faith and reasonable belief the facts imposing the statutory obligation were not present.” (Id. at pp. 1249-1250 [internal quotations and citations omitted, emphasis in original].)

Defendant argues that here, “Plaintiff has no basis to recover on his request for an award of civil penalties for Breach of Express Warranty under the Song-Beverly Act because Plaintiff cannot produce clear and convincing evidence that Defendant willingly avoided its responsibilities to repurchase the subject vehicle as the Act requires.” (Mot. at p. 5:23-26.) More specifically, Defendant asserts that “Plaintiff did not make a repurchase request of the subject vehicle prior to the filing of this lawsuit. Without putting Defendant…on notice of the alleged issues complained of, any alleged failure of [Defendant] to repurchase the subject vehicle was not willful.” (Mot. at p. 6:12-15.)

Defendant asserts that “Plaintiff’s counsel acknowledged that Plaintiff did not request a repurchase or replacement of the Subject Vehicle during the deposition of Donald Crusenberry, MBUSA’s Person Most Knowledgeable, taken by Plaintiff on January 30, 2023.” (Thayer Decl., ¶ 7.) Defendant points to the following testimony from Mr. Crusenberry’s deposition: “Q. And then Category No. 7, defendants’ failure to repurchase plaintiff’s vehicle, do you know whether my client contacted Mercedes-Benz USA, LLC regarding the vehicle, prior to the lawsuit? A. That information would be contained in the C1C report. If I recall, I’m sure we will later, I don’t believe so.” (Thayer Decl., ¶ 7, Ex. D (Crusenberry Depo.) at p. 47:12-18.)

Defendant also points to the following testimony from Mr. Crusenberry’s deposition: “Q. And you’re not aware of anyone within Mercedes-Benz USA, LLC that looked at whether my client’s vehicle should be repurchased or replaced, correct? A. Not to my knowledge…Q. So you told me on the record that you’re not aware of Mercedes-Benz evaluating whether my client’s vehicle should be repurchased or replaced prior to the lawsuit being filed. Do you think that is because my client did not contact Mercedes-Benz and request repurchase or replacement directly?...THE WITNESS: Yes.” (Thayer Decl., ¶ 7, Ex. D (Crusenberry Depo.) at pp. 48:15-49:9.) In addition, Defendant’s counsel asserts in his supporting declaration that “[t]he Subject Vehicle’s Customer Assistance Center Report holds no record of Plaintiff ever requesting a repurchase demand for the Subject Vehicle.” (Thayer Decl., ¶ 6.)

In the opposition, Plaintiff asserts that Defendant fails to meet its initial burden of demonstrating that Plaintiff’s claim for a civil penalty is without merit. Plaintiff asserts that “[t]he entirety of Defendant’s Motion for Summary Adjudication is premised upon the unsupported and false legal contention that Plaintiff’s failure to demand a pre-litigation buyback deprives him of the opportunity to recover a civil penalty. Plaintiff was not required to make an affirmative request for repurchase or replacement under the Song-Beverly Consumer Warranty Act.” (Opp’n at p. 8:11-14.)

Plaintiff cites to Krotin v. Porsche Cars North America, Inc. (1995) 38 Cal.App.4th 294, 301-302, where the Court of Appeal noted that “[t]he [Song-Beverly Consumer Warranty Act] contains no ‘reasonable time’ requirement by which the consumer must invoke the Act or lose rights granted by that statutory scheme. Rather, the Act creates an affirmative duty upon the manufacturer or its representative to provide restitution or replacement when a covered defect, i.e. a ‘nonconformity’ (Civ. Code, § 1793.22, subd. (e)(1)), is not repaired after a reasonable number of attempts.” The Krotin Court further noted as follows:

“Amici curiae in the present case urge an appeal to ‘common sense’ in that if a manufacturer, pursuant to the Act, must respond promptly to a consumer’s demand for replacement or reimbursement, then the consumer must be under a duty to notify the manufacturer in a reasonable and timely manner of the need for such action. Otherwise, the argument goes, the manufacturer would have to become ‘clairvoyant’ with respect to acknowledging and responding to otherwise unknown claims by consumers. However, as previously discussed, the Act does not require consumers to take any affirmative steps to secure relief for the failure of a manufacturer to service or repair a vehicle to conform to applicable warranties--other than, of course, permitting the manufacturer a reasonable opportunity to repair the vehicle. The so called ‘commonsense’ argument arises only because of the disparity between the law as written and reality as it appears in the typical service department of a dealership. In reality, as indicated by the facts alleged at trial by the Krotins, the manufacturer seldom on its own initiative offers the consumer the options available under the Act: a replacement vehicle or restitution. Therefore, as a practical matter, the consumer will likely request replacement or restitution. But the consumer’s request is not mandated by any provision in the Act. Rather, the consumer’s request for replacement or restitution is often prompted by the manufacturer’s unforthright approach and stonewalling of fundamental warranty problems.” (Krotin v. Porsche Cars North America, Inc., supra, 38 Cal.App.4th at pp. 302-303 [emphasis in original].)

The Krotin Court further found that “[a]s it stands now…the manufacturer has an affirmative duty to replace a vehicle or make restitution to the buyer if the manufacturer is unable to repair the new vehicle after a reasonable number of repair attempts, and the buyer need not reject or revoke acceptance of the vehicle at any time. The buyer need only provide the manufacturer with a reasonable opportunity to fix the vehicle. Accordingly, the jury instruction complained of which required the lessee in the present case to reject or revoke acceptance within a reasonable time was error.” (Krotin v. Porsche Cars North America, Inc., supra, 38 Cal.App.4th at p. 303.)

In the reply, Defendant does not appear to address Plaintiff’s assertion that “Plaintiff was not required to make an affirmative request for repurchase or replacement under the Song-Beverly Consumer Warranty Act.” (Opp’n at p. 8:13-14.) Defendant also does not address the Krotin case in the reply. Defendant’s motion is made “on the grounds that [Plaintiff] is not entitled to civil penalties under the Song-Beverly Act,” because “Plaintiff failed to demand a pre-litigation buyback of the subject vehicle and therefore cannot claim civil penalties as there is no basis for this recovery.” (Notice of Motion at p. 2:8-11.) As discussed, the Krotin Court noted that “the Act does not require consumers to take any affirmative steps to secure relief for the failure of a manufacturer to service or repair a vehicle to conform to applicable warranties--other than, of course, permitting the manufacturer a reasonable opportunity to repair the vehicle.” (Krotin v. Porsche Cars North America, Inc., supra, 38 Cal.App.4th at pp. 302-303 [emphasis in original].)

Based on the foregoing, the Court does not find that Defendant has met its initial burden of demonstrating that Plaintiff’s claim for a civil penalty is without merit.

Based on the foregoing, Defendant’s motion for summary adjudication is denied.

Superior Court of California

County of Los Angeles

Department 50