Judge: Theodore R. Howard, Case: 22-1243139, Date: 2022-09-01 Tentative Ruling
A) Demurrer
Defendants FCA US LLC (“FCA” individually) and Surf City Auto Group dba Huntington Beach CJD Ram’s (“Surf City” individually; Defendants” together with FCA) Demurrer to plaintiff Roberto Lopez’s (“Plaintiff”) Complaint is SUSTAINED.
A demurrer challenges the defects appearing on the face of the pleading or from other matters properly subject to judicial notice. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) The issue is the sufficiency of the pleading, not the truth of the facts alleged. Thus, no matter how unlikely or improbable, the allegations made must be accepted as true for the purpose of ruling on the demurrer. (Del E. Webb Corporation v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604.) Absent court orders or other items subject to judicial notice, or items attached as exhibits to the complaint, the court may not consider the contents of pleadings or other exhibits when ruling on a demurrer. (Day v. Sharp (1975) 50 Cal.3d 904, 914; Sosinsky v. Grant (1992) 6 Cal.App.4th 1746, 1749.)
“In our examination of the complaint we are guided by the well settled principles governing the testing of its sufficiency by demurrer: A demurrer admits all material and issuable facts properly pleaded. [Citations omitted.] However, it does not admit contentions, deductions or conclusions of fact or law alleged therein. [Citations omitted.]” (Daar v. Yellow Cab Co. (1967) 67 Cal.2d 666, 672.)
Under Section 430.10(e) the test is whether the complaint states any valid claim entitling plaintiff to relief, even if Plaintiff’s cause of action is improperly titled, or an improper remedy is stated. (Quelimane Co., Inc. v. Stewart Title Guar. Co. (1998) 19 Cal.4th 26, 38.)
Defendants demur to the fifth and sixth causes of action (“COA”) on the bases they 1) have not pled sufficient facts to support those COA against the specific defendant (Civ. Proc. Code § 430.10(e); and 2) are barred by the Economic Loss Rule.
1) COA No. 5 – Fraudulent Inducement - Concealment
“Concealment is, “[t]he suppression of a fact, by one who is bound to disclose it, or who gives information of other facts which are likely to mislead for want of communication of that fact” (Civ. Code § 1710(3).) “To state a claim for fraudulent concealment under California law, a plaintiff must allege: “ ‘(1) a misrepresentation (false representation, concealment, or nondisclosure); (2) knowledge of falsity (or scienter); (3) intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage.’ ”” (In re Toyota Motor Corp. Unintended Acceleration Mktg., Sales Practices, & Prod. Lab. Litig., 754 F. Supp. 2d 1145, 1189 (C.D. Cal. 2010) [Toyota].( “A plaintiff may demonstrate a duty to disclose in four circumstances: “(1) when the defendant is [] in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material fact.” (Id.)
Plaintiff alleges FCA allowed the 2019 Jeep Cherokee vehicle identification number 1C4PJMDX5KD282013 ("Vehicle") to be sold to Plaintiff without disclosing the transmission and PCM (“Defects” together) were defective. (Complaint ¶ 67.) Plaintiff alleges FCA knew of the Defects prior to the sale of the Vehicle. (Complaint ¶¶ 68-69.) Plaintiff also alleges FCA failed to disclose the Defects and knowingly concealed and breached its duty not to conceal those facts. (Complaint ¶ 71.) Finally, Plaintiff alleges that had he known of the Defects, he would not have purchased the Vehicle. (Complaint ¶ 72.)
Though Plaintiff alleges FCA had exclusive knowledge about the Defects, the allegations in the Complaint indicate that is not the case. The Complaint states on 05/11/16, 06/17/16, and August 2017 FCA issued a TSB and recalls to address issues, including updating the PCM with the latest software. (Complaint ¶¶ 29-30.) FCA also issued two Safety Recalls to resolve stalling issues on 01/11/18. (Complaint ¶ 33-39.) This information was put out to the public well before Plaintiff purchased the Vehicle on 11/03/18. (Complaint ¶ 10.) As the Defects were part of recalls prior to Plaintiff’s purchase of the Vehicle, FCA could not have “concealed” the Defects from Plaintiff. It is also unclear exactly what damages Plaintiff is alleging he suffered. Plaintiff merely states, “[d]efects and nonconformities to warranty manifested themselves within the applicable express warranty period, including but not limited to, the electrical system; the transmission; defects causing stalling; the engine; among other defects and non-conformities.” (Complaint ¶ 15.) Plaintiff has not alleged he took the vehicle in, how many times he took the Vehicle in, and/or that the Vehicle was not repaired.
Plaintiff has failed to plead the fraud claims with specificity as he failed to, “allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.” (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal. App. 4th 153, 157 (“Tarmann”).) There does not appear to have been a relationship between FCA and Plaintiff prior to the purchase of the Vehicle that would have required or enabled FCA to communicate any alleged issues with the Vehicle.
Plaintiff has not pled sufficient facts to support this COA. (Civ. Proc. Code § 430.10(e).)
The economic loss rule (“ELR”) also applies to this COA as it is a lemon law matter that pleads omission or concealment of information. (Stewart v. Electrolux Home Prod., Inc., 304 F. Supp. 3d 894, 902 and 904-05 (E.D. Cal. 2018); Friche v. Hyundai Motor, Am., No. SACV2101324CJCADSX, 2022 WL 1599868, at *7 (C.D. Cal. Jan. 28, 2022).)
The Demurrer is SUSTAINED as to this COA, with leave to amend.
2) COA No. 6 – Negligent Repair
“The elements of negligence are duty, breach, causation, and damages. [Citation.] “One who undertakes repairs has a duty arising in tort to do them without negligence.” ‘ “ (Sabicer v. Ford Motor Co., 362 F. Supp. 3d 837, 840–41 (C.D. Cal. 2019)(“Sabicer”.)
The Complaint simply alleges, “Plaintiff delivered the Vehicle to [Surf City] for substantial repair on at least one occasion.” (Complaint ¶ 76.) Surf City owed a duty of ordinary care and skill in repairing the Vehicle. (Complaint ¶ 77.) Surf City breach its duty by failing to repair the Vehicle in accordance with industry standards. (Complaint ¶ 78.) Surf City’s breach of its duties was the proximate cause of Plaintiff’s damages. (Complaint ¶ 79.)
Plaintiff merely makes conclusory statements and/or parrots the elements of negligence but does not allege any actual facts supporting this COA. Plaintiff has not alleged when the Vehicle was brought in for repairs, how many times it was taken in, what the issues with the Vehicle were, and what the outcome (if any) was for any of presentations for repair. Plaintiff has also not alleged any specific damages caused by any negligent repairs.
Plaintiff has not pled sufficient facts to support this COA. (Civ. Proc. Code § 430.10(e).) Further, based on the limited allegations under this COA, it also appears the ELR applies.
The Demurrer is SUSTAINED as to this COA, with leave to amend.
B) Motion to Strike
Defendants’ Motion to Strike (“MTS”) is GRANTED.
“Any party, within the time allowed to respond to a pleading may serve and file a notice of motion to strike the whole or any part thereof. . .” (Civ. Proc. Code § 435(b)(1). “The court may, upon a motion made pursuant to Section 435, or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading. (b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.” (Civ. Proc. Code § 436.)
Defendants seek to solely strike the Prayer for punitive damages. Pursuant to Civ. Code § 3294, punitive damages are awardable only in instances of malice, oppression, or fraud.
It is not sufficient to allege merely that a defendant “acted with oppression, fraud or malice.” A plaintiff must allege specific facts showing that defendant’s conduct was oppressive. (Smith v. Sup.Ct. (Bucher) (1992) 10 Cal.App.4th 1033, 1041-1042; Anschutz Entertainment Group, Inc. v. Snepp (2009) 171 Cal.App.4th 598, 643.) “Despicable conduct” is conduct that is so “vile, base, contemptible, miserable, wretched or loathsome that it would be looked down upon and despised by ordinary decent people.” (Scott v. Phoenix Schools, Inc. (2009) 175 Cal.App.4th 702, 715.)
Fraud, “must be alleged in the proper manner and the facts constituting the fraud must be alleged with sufficient specificity to allow defendant to understand fully the nature of the charge made [citations].” (Tarmann, supra, 2 Cal.App.4th at 157.) Fraud must be pled with particularity. (Comm. on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 216.) Particularity requires facts that, “show how, when, where, to whom, and by what means the representations were tendered.” (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 993.) “[S]pecificity in a fraud action against a corporation requires the plaintiff to allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.” (Tarmann, supra, 2 Cal.App.4th at 157-58.)
“Not only must there be circumstances of oppression, fraud or malice, but facts must be alleged in the pleading to support such a claim.” (Grieves v. Superior Court, 157 Cal. App. 3d 159, 166 (Ct. App. 1984).)
In the present matter, the only COA based in fraud was COA No. 5, which was subject to the demurrer, supra, thus there is no basis for punitive damages under the fraud prong.
As for the malice prong, Plaintiff has not pled any facts under any COA that any of the actions taken by Defendants were intended to cause harm to Plaintiff specifically, nor that there was any despicable conduct on the part of Defendants with a willful and conscious disregard of the rights or safety of others. At most, Plaintiff has alleged Defendants failed to promptly replace or repair defective parts and comply with obligations under Song Beverly.
As for the oppression prong, Plaintiff has not pled any conduct that is despicable in nature and that subjected Plaintiff to cruel and unjust hardships in conscious disregard for Plaintiff’s rights.
As Plaintiff has failed to properly plead facts supporting malice, oppression, and/or fraud, the MTS is GRANTED.
Plaintiff is given leave to file an amended complaint within 10-days written notice of the court’s ruling.
Defendants to give notice.