Judge Thomas D. Long, Case Number: 21STCV09874, Date: 2024-11-07 Tentative Ruling

On March 12, 2021, Plaintiffs Carla Vega and Leonel Torres filed this action against Defendant FCA US LLC, arising from their purchase of an allegedly defective vehicle.

The Court initially granted a motion to compel arbitration before granting a motion for reconsideration of that order on August 22, 2023. The action resumed in this court.

Plaintiffs’ Objection Nos. 1-3 to the Declaration of James Bielenda are sustained. The declarant does not demonstrate personal knowledge, and where he may have sufficient knowledge, the objected-to statements are conclusions, not facts.

Defendant’s objections to Plaintiffs’ Additional Material Facts are overruled. Additionally, the objected-to statements are not material to the Court’s decision and did not affect the outcome.

Defendant’s request for judicial notice of Plaintiffs’ discovery responses while this case was pending in arbitration is denied. These are not “Official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “Records of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” or “Rules of court of (1) any court of this state or (2) any court of record of the United States or of any state of the United States.” (See RJN at p. 2.)

Even if the Court could take judicial notice of the documents, it could not notice the truth of the contents as fact. “While courts take judicial notice of public records, they do not take notice of the truth of matters stated therein. [Citation.] ‘When judicial notice is taken of a document, . . . the truthfulness and proper interpretation of the document are disputable.’ [Citation.]” (Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375.)

“Separate statements are required not to satisfy a sadistic urge to torment lawyers, but rather to afford due process to opposing parties and to permit trial courts to expeditiously review complex motions for [summary adjudication] and summary judgment to determine quickly and efficiently whether material facts are undisputed.” (United Community Church v. Garcin (1991) 231 Cal.App.3d 327, 335 (United Community Church).) “The separate statement ‘provides a convenient and expeditious vehicle permitting the trial court to hone in on the truly disputed facts.’ [Citation.]” (Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 252 (Nazir).) “[I]t is no answer to say the facts set out in the supporting evidence and memorandum of points and authorities are sufficient. ‘Such an argument does not aid the trial court at all since it then has to cull through often discursive argument to determine what is admitted, what is contested, and where the evidence on each side of the issue is located.’” (United Community Church, supra, 231 Cal.App.3d at p. 335.) “The due process aspect of the separate statement requirement is self-evident—to inform the opposing party of the evidence to be disputed to defeat the motion.” (Id. at p. 337.)

“The separate statement should include only material facts and not any facts that are not pertinent to the disposition of the motion.” (California Rules of Court, rule 3.1350(d)(2).) The parties should not “include in the separate statement every fact they intend to include in their motion, regardless of its materiality.” (Beltran v. Hard Rock Hotel Licensing, Inc. (2023) 97 Cal.App.5th 865, 875 (Beltran).) “The paragraphs in a separate statement should be limited to facts that address the elements of a cause of action or an affirmative defense. (See Code Civ. Proc., § 437c, subd. (b)(1); rule 3.1350(a)(2), (d)(2).) The statute and Rules of Court do not preclude litigants from including background, nonmaterial information in their papers as long as they include a cite to the evidence, but nonmaterial facts should not be included in the separate statement. The point of the separate statement is not to craft a narrative, but to be a concise list of the material facts and the evidence that supports them.” (Ibid.) “[A] document that was intended to be helpful to the court and provide due process to the parties [citation] is, in many cases, no longer serving either purpose.” (Id. at p. 874.)

The separate statement here does not serve its intended purpose. Defendant frequently set forth evidentiary facts rather than ultimate facts, which bury the actual undisputed (or disputed) issues that are material to this motion. Additionally, what a party said or perceived is not a “material fact”; rather, it is evidence of a fact. (Reeves v. Safeway Stores, Inc. (2004) 121 Cal.App.4th 95, 106 (Reeves).) Some of Defendant’s purported “undisputed facts” are not facts that are material to the motion. For example, it is undisputed that “Defendant served Special Interrogatories, Set One, on Plaintiffs on February 9, 2023 while this case was in the arbitration forum.” (UMF 18.) It is undisputed that “Defendant’s Special Interrogatory No. 17 requested all facts supporting Plaintiffs’ fourth cause of action and Defendant’s Special Interrogatory No. 20 requested all facts supporting Plaintiffs’ claim for punitive damages.” (UMF 20.) It is undisputed that “[i]n response to Interrogatory No. 19, Plaintiffs, after a series of boilerplate objections, identified, ‘Plaintiffs and Defendant, its agents, representatives, and employees.’ No one was identified by name.” (UMF 26.) These are not “facts that address the elements of a cause of action or an affirmative defense.” (Beltran, supra, 97 Cal.App.5th at p. 875.) The actual undisputed facts are extremely limited, which affects the Court’s ability to decide this motion. This is evident in the recitation of truly undisputed facts below.

“[T]rial courts have the inherent power to strike proposed ‘undisputed facts’ that fail to comply with the statutory requirements and that are formulated so as to impede rather than aid an orderly determination whether the case presents triable material issues of fact. If such an order leaves the required separate statement insufficient to support the motion, the court is justified in denying the motion on that basis.” (Reeves, supra, 121 Cal.App.4th at p. 106.)

Although the Court will not strike non-material portions of the separate statements here, counsel is cautioned to include only facts that are truly material to the motion.

On July 9, 2015, Plaintiff Carla Vega purchased a 2015 Dodge Charger. (Undisputed Material Facts “UMF” 1.)

Plaintiffs allege that Defendant concealed information relating to the PowerNet Electrical Architecture/Body Control Module. (See Complaint; UMF 34, 41-42.)

For each claim in the complaint, the defendant moving for adjudication must satisfy the initial burden of proof by showing that one or more elements of a cause of action cannot be established or that there is a complete defense to a cause of action. (Code Civ. Proc., § 437c, subd. (p)(2); Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520 (Scalf).) Then the burden shifts to the plaintiff to show that a triable issue of material fact exists as to that cause of action or a defense. (Code Civ. Proc., § 437c, subd. (p)(2); Scalf, supra, 128 Cal.App.4th at p. 1520.) To establish a triable issue of material fact, the party opposing the motion must produce “substantial responsive evidence.” (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 162-163.)

Defendant seeks summary adjudication of the fourth cause of action for Fraudulent Inducement – Concealment and the related prayer for punitive damages.

A. Defendant Does Not Meet Its Burden of Showing That Plaintiffs Cannot Support Their Claims.

According to Defendant, “Plaintiffs have not and cannot produce evidence of concealment, or intent to conceal and defraud.” (Motion at p. 8.) Defendant points to Plaintiffs’ responses to special interrogatories and requests for production of documents during their arbitration proceedings. (Ibid.)

“[A] defendant moving for summary judgment [must] present evidence, and not simply point out that the plaintiff does not possess, and cannot reasonably obtain, needed evidence.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 854 (Aguilar), footnote omitted.) Defendant must therefore “present evidence that the plaintiff does not possess, and cannot reasonably obtain, needed evidence—as through admissions by the plaintiff following extensive discovery to the effect that he has discovered nothing.” (Id. at p. 855.)

Defendant has not done so here. Plaintiffs’ discovery responses in arbitration are not subject to judicial notice. Even as authenticated exhibits (see Fisher Decl. ¶¶ 5, 7), they contain statements made in a different proceeding and are hearsay. Even taken as statements of a party opponent (Evid. Code, § 1220), the responses are not evidence that Plaintiffs do not possess, and cannot reasonably obtain, needed evidence. A response that “[d]iscovery is still continuing and Plaintiffs reserve the right to supplement or amend this response should additional information become available” on April 28, 2023 does not show that Plaintiffs cannot prove their claims over a year and a half later, and Plaintiffs have not admitted that they have no supporting evidence.

Defendant also argues that Plaintiffs’ claims “rest entirely on the faulty premise that there is a defect in all PNAs, deriving from a different electrical architecture, the TIPM, in all vehicles manufactured by FCA US,” and Plaintiffs cannot show a defect that Defendant concealed from them. (Motion at pp. 8-10.) Defendant relies on the declaration of James Bielenda, the former Manager of product investigations for Defendant.

An expert declaration is admissible to support or defeat summary judgment if the expert’s testimony would be admissible at trial. (Fernandez v. Alexander (2019) 31 Cal.App.5th 770, 779.) “‘Declarations must show the declarant’s personal knowledge and competency to testify, state facts and not just conclusions, and not include inadmissible hearsay or opinion.’ [Citation.]” (Ibid.) The expert declaration must also contain a “reasoned explanation” and not just conclusions. (Id. at p. 782.)

Defendant contends that “witness James Bielenda is not Defendant’s expert witness, contrary to Plaintiffs’ assertion that he is in their Opposition.” (Reply at p. 1, fn. 1.) Yet Bielenda sets forth his opinions on Plaintiffs’ alleged defects without personal knowledge of Plaintiffs’ exact vehicle and defects. Regardless, the facts he sets forth still do not establish the lack of a defect known to Defendant.

Plaintiffs allege that the PowerNet (the particular electrical architecture installed in the subject vehicle) controls virtually all of the vehicle’s electrical components. (Complaint ¶ 21.) Due to the defective PowerNet, windows were inoperable, gauges fluctuated, the dash got extremely hot, headlights did not light up, the trunk would not open, and the air conditioning would not turn on. (Complaint ¶¶ 22-23, 153-156.) According to Bielenda, “[t]he 2015 Dodge Charger contains no component called a ‘PowerNet.’ It does not utilize a front control module.” (Bielenda Decl. ¶ 10.) However, Plaintiffs’ vehicle model has two separate Power Distribution Centers (“PDCs”): one under hood and the other in the vehicle’s trunk. (Bielenda Decl. ¶ 11.) “Depending on the features on a particular vehicle, there are more than 18 different modules in a 2015 Dodge Charger.” (Bielenda Decl. ¶ 12.) Bielenda then describes various modules and declares, “There is no defect common to all electrical architectures in all vehicles manufactured by FCA US,” and, “There have been no recalls associated with the PowerNet Architecture or Gateway module in the 2015 Dodge Charger.” (Bielenda Decl. ¶¶ 13-17, 21.) This does not establish that Plaintiffs’ exact vehicle did not suffer the alleged defects.

Additionally, according to Bielenda, “The subject vehicle does not contain a TIPM. Plaintiffs make assumptions and derive conclusions based on complete misunderstandings of the TSB or Recalls they listed.” (Bielenda Decl. ¶ 22.) But Plaintiffs also allege Defendant’s knowledge of problems with the Body Control Module (“BCM”) in other vehicles with the same BCM as in Plaintiffs’ vehicle. (E.g., Complaint ¶¶ 16, 29, 33, 36-37, 40-41, 51, 55-56, 70, 72, 74.) Bielenda acknowledges that “[a] 2015 Dodge Charger [Plaintiffs’ vehicle] also contains a Body Control Module (‘BCM’), which contains two gateway modules.” (Bielenda Decl. ¶ 14.) This declaration does not satisfy Defendant’s burden of showing that Plaintiffs’ vehicle was not defective or that Defendant’s had no knowledge of the alleged concealed defects.

B. Fraudulent Inducement – Concealment Is Not Barred By The Economic Loss Rule.

Defendant argues that the economic loss rule bars Plaintiffs’ claim for Fraudulent Inducement – Concealment. (Motion at pp. 12-14.)

Under the economic loss rule, “[w]here a purchaser’s expectations in a sale are frustrated because the product he bought is not working properly, his remedy is said to be in contract alone, for he has suffered only ‘economic’ losses.” (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 988 (Robinson), quotation marks omitted.) However, tort damages may be permitted when the breach of contract is accompanied by a tort such as fraud. (Id. at pp. 989-990.) “[U]nder California law, the economic loss rule does not bar [a claim] for fraudulent inducement by concealment. Fraudulent inducement claims fall within an exception to the economic loss rule recognized by our Supreme Court” in Robinson, and such claims allege fraudulent conduct that is independent of the alleged warranty breaches. (Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 843.)

Defendant argues that, at the time it filed its motion, “California courts, both state and federal courts sitting in diversity, are divided on the issue of whether fraudulent concealment claims are exempt from the economic loss rule.” (Motion at p. 12.) Defendant therefore urges the Court to follow California federal courts in denying a fraudulent inducement claim in standard Song-Beverly Act breach of warranty actions. (Id. at p. 13.) However, since then, the Supreme Court confirmed that “the economic loss rule does not apply to limit recovery for intentional tort claims like fraud.” (Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, 38.) “A plaintiff may assert a tort claim for fraudulent concealment based on conduct occurring in the course of a contractual relationship, if the elements of the cause of action can be established independently of the parties' contractual rights and obligations and the tortious conduct exposes the plaintiff to a risk of harm beyond the reasonable contemplation of the parties when they entered into the agreement.” (Ibid.)

Defendant argues that Plaintiffs cannot produce the required “clear and convincing evidence” for punitive damages. (Motion at pp. 10-12.) Defendant again relies on Plaintiff’s discovery responses and failure to affirmatively produce evidence. This is insufficient. (Aguilar, supra, 25 Cal.4th at pp. 854-855.)

Defendant also argues that because the prayer for punitive damages is premised solely on the fourth cause of action, “[w]ithout proof of fraudulent concealment, Plaintiffs’ claim for punitive damages must fail.”

Because the Court denies summary adjudication of the fourth cause of action, summary adjudication of punitive damages is also denied.

Parties who intend to submit on this tentative must send an email to the Court at SMCDEPT48@lacourt.org indicating intention to submit. If all parties in the case submit on the tentative ruling, no appearances before the Court are required unless a companion hearing (for example, a Case Management Conference) is also on calendar.

Hon. Thomas D. Long

Judge of the Superior Court