Judge William A. Crowfoot, Case Number: 23AHCV00369, Date: 2024-01-26 Tentative Ruling

Judge: William A. Crowfoot, Case: 23AHCV00369, Date: 2024-01-26 Tentative Ruling

On February 21, 2023, plaintiff Jesus Manuel Perez Caudillo (“Plaintiff”) filed this action against defendant General Motors LLC (“Defendant”) asserting claims based on fraudulent concealment and violations of the Song-Beverly Act. Plaintiff alleges that he purchased a 2019 GMC Sierra (“Subject Vehicle”) on June 8, 2019, which included an eight-speed automatic transmission.

Plaintiff alleges that Defendant’s new eight-speed automatic transmissions had a “design defect based on a typical architecture that causes ‘harsh shifts’ in lower gears, which can feel like jerking, lurching, and/or hesitations” (the “Transmission Defect”) and that the Subject Vehicle was delivered with this Transmission Defect.

Plaintiff delivered the Subject Vehicle for repairs in February 2020 for an electrical and structural issue. In September 2021, on November 7 and November 25, 2022, and in December 2022, Plaintiff presented the vehicle for issues relating to the Transmission Defect. (Compl., ¶¶ 63-66.) The Transmission Defect made Plaintiff’s Vehicle “hesitate[] when attempting to pick up speed after slowing down, and when taking off from a stop. This hesitation is sometimes accompanied by excessive revving in which the rpm meter moves, but the vehicle does not accelerate commensurately, followed by a jerk or judder when the vehicle does engage.” Furthermore, Plaintiff alleges, “[the] transmission slip[ped] when driven at highway speeds.” (Compl., ¶ 13.)

On August 10, 2023, Defendant filed a demurrer to Plaintiff’s cause of action for “Fraud-Fraudulent Inducement-Concealment” and a motion to strike Plaintiff’s prayer for punitive damages.

A demurrer tests the legal sufficiency of the pleadings and will be sustained only where the pleading is defective on its face. (City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1998) 68 Cal.App.4th 445, 459.) “We treat the demurrer as admitting all material facts properly pleaded but not contentions, deductions or conclusions of fact or law. We accept the factual allegations of the complaint as true and also consider matters which may be judicially noticed. [Citation.]” (Mitchell v. California Department of Public Health (2016) 1 Cal.App.5th 1000, 1007; Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604 [“the facts alleged in the pleading are deemed to be true, however improbable they may be”].) Allegations are to be liberally construed. (Code Civ. Proc., § 452.) A demurrer may be brought if insufficient facts are stated to support the cause of action asserted. (Code Civ. Proc., § 430.10, subd. (e).)

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. (Code Civ. Proc., § 435, subd. (b)(1).) The court may, upon a motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading. (Code Civ. Proc., § 436, subd. (a); Stafford v. Shultz (1954) 42 Cal.2d 767, 782 [“Matter in a pleading which is not essential to the claim is surplusage; probative facts are surplusage and may be stricken out or disregarded”].) The court may also strike all or any part of any pleading not drawn or filed in conformity with California law, a court rule, or an order of the court. (Code Civ. Proc., § 436, subd. (b).) An immaterial or irrelevant allegation is one that is not essential to the statement of a claim or defense; is neither pertinent to nor supported by an otherwise sufficient claim or defense; or a demand for judgment requesting relief not supported by the allegations of the complaint. (Code Civ. Proc., § 431.10, subd. (b).) The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. (Code Civ. Proc., § 437.)

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the complainant to show the Court that a pleading can be amended successfully. (Ibid.)

Defendant argues that Plaintiff’s fraud claim is 8 months and 13 days too late because he should have filed this action by June 8, 2022, three years after he purchased the Subject Vehicle. Defendant places great emphasis on Plaintiff’s allegation that the “Subject Vehicle was delivered to Plaintiff with serious defects and nonconformities.” (Demurrer, p. 8 [citing to Compl., ¶ 19].) Defendant contends that the delayed discovery rule does not apply because Plaintiff “conceded” that the Subject Vehicle was delivered to him with defects.

In opposition, Plaintiff argues that alleging the Subject Vehicle is defective is not the same as admitting knowledge of those defects. Second, Plaintiff argues that the statute of limitations was tolled because Defendant concealed the Transmission Defect from Plaintiff since 2014, by concealing its internal data, consumer complaints, pre-release testing data, aggregate data from dealers, repair orders, and service bulletins. Third, Plaintiff argues that the statute of limitations was tolled because Defendant’s authorized repair facility asserted that the Transmission Defect could be fixed, which concealed the true nature of the Defect.

On reply, Defendant relies on federal cases to argue that reassurances from the repair centers alone were insufficient to toll the fraud claim if there are signs of continued problems. The Court agrees. Here, Plaintiff alleges that they began to experience the Transmission Defects “[s]hortly after [they] purchased their vehicle” and the problems “gradually worsened over time.” (Comp., ¶ 13.) Yet, Plaintiff did not bring the Subject Vehicle in for repair for issues relating to the Transmission Defects until September 2021, when they were told that the Subject Vehicle was operating as intended. (Compl., ¶ 63.) This means that Plaintiff was allegedly driving an automobile that was displaying the above-described hesitation, excessive revving, failure to accelerate, jerks, judders, and transmission slips for over two years before deciding to take the Vehicle in for repairs. It is implausible that Plaintiff could not have uncovered the Transmission Defects within those two years or that waiting that amount of time constitutes “reasonable diligence.” Nor can Plaintiff have reasonably relied on representations in September 2021 or November 2022 that the Subject Vehicle was operating “as intended” after experiencing those symptoms for several years.

Furthermore, Plaintiff tellingly does not clearly allege when their fraudulent concealment claim accrued. Instead, Plaintiff states that they did not learn of Defendant’s deception “until [they] filed this Complaint and once the Transmission Defect manifested and could not be repaired by Defendant and its representative.” However, this statement is ambiguous because it refers to at least three different periods of time: (1) when the complaint was filed on February 21, 2023, (2) when the problems manifested, which is allegedly “shortly after purchase” on June 8, 2019, and (3) after the Transmission Defect “could not be repaired,” which either refers to when Defendant’s authorized dealership informed Plaintiff that the vehicle was “fully repaired” in December 2022 or September 2021 and November 2022, when Plaintiff was told that there were no issues with the vehicle.

In light of these allegations, Plaintiff does not plead any theory of tolling which would save his fraud claim from the statute of limitations. Accordingly, the demurrer to the claim for fraudulent concealment is SUSTAINED without leave to amend.

Because the Court sustains the demurrer, Defendant’s motion to strike is MOOT and taken off calendar.

Defendant’s demurrer to the Fourth Cause of Action is SUSTAINED without leave to amend.

William A. Crowfoot

Judge of the Superior Court

Parties who intend to submit on this tentative must send an email to the Court at ALHDEPT3@lacourt.org indicating intention to submit on the tentative as directed by the instructions provided on the court website at www.lacourt.org. Please be advised that if you submit on the tentative and elect not to appear at the hearing, the opposing party may nevertheless appear at the hearing and argue the matter. Unless you receive a submission from all other parties in the matter, you should assume that others might appear at the hearing to argue. If the Court does not receive emails from the parties indicating submission on this tentative ruling and there are no appearances at the hearing, the Court may, at its discretion, adopt the tentative as the final order or place the motion off calendar.