Clark v. LG Electronics U.S.A., Inc. et al

Filing 24

ORDER Granting In Part and Denying In Part Defendant LG Electronics U.S.A., Inc's 20 Motion to Dismiss Plaintiff's Second Amended Complaint and Denying 20 Motion to Strike Allegations from Plaintiff's Second Amended Complaint. Cour t dismisses Pla's UCL, FAL, and breach of warranty claims made on behalf of the general public with prejudice and w/o leave to amend. Court dismissed Pla's breach of express warranty claims and MMWA claim based upon breach of express warranty w/o leave to amend at this time. Dft LG ordered to file answer within 20 days of the filing of this Order. Signed by Judge Jeffrey T. Miller on 10/29/2013.(jah)(jrd)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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JEANETTE CLARK, individually and
on behalf of those similarly situated,

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vs.

Plaintiff,

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LG ELECTRONICS U.S.A., INC. and
DOES 1 through 25, inclusive,

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CASE NO. 13-cv-485 JM (JMA)
ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANT’S
MOTION TO DISMISS; DENYING
DEFENDANT’S MOTION TO
STRIKE
[Dkt. No. 20]

Defendant.
Plaintiff Jeanette Clark ("Plaintiff") filed a complaint in California state court

18 on December 10, 2012 against LG Electronics U.S.A., Inc. ("LG"), which was later
19 dismissed. Plaintiff filed a first amended complaint (“FAC”) in California state
20 court on January 14, 2013. On February 28, 2013, LG removed this matter to
21 federal court. On June 7, 2013, the court granted LG’s motion to dismiss Plaintiff’s
22 first amended complaint and granted Plaintiff leave to file a second amended
23 complaint (“SAC”). On July 8, 2013, Plaintiff filed her SAC, and subsequently LG
24 filed a motion to dismiss under Federal Rule of Civil Procedure ("Rule") 12(b)(6)
25 and a motion to strike under Rule 12(f) on August 5, 2013. For the reasons
26 explained below, LG's motion to dismiss is GRANTED IN PART and DENIED IN
27 PART. Additionally, LG’s motion to strike is DENIED.
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BACKGROUND

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In or about October 2011, Plaintiff purchased a LG refrigerator, Model No.

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LFX31925ST, for approximately $3,000. SAC ¶ 9. She used her LG refrigerator
in a manner consistent with its intended use. Id. The refrigerator allegedly had a

6 Smart Cooling Plus system (“SCP system”) “to keep your food fresh” and came
7 with an express warranty for workmanship and materials. Id. ¶ 11. The
8 refrigerator also had a LG Slim SpacePlus™ Ice System (“Ice System”) located in
9 the interior portion of the door of the refrigerator, which allegedly gives it more
10 storage capacity than other refrigerators. Id. ¶ 10.
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Within one month of owning and operating the refrigerator, Plaintiff claims
12 the refrigerator began to have problems. Id. ¶ 12. Plaintiff alleges the Ice System
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would repeatedly clog and become non-operational. Id. When Plaintiff contacted
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LG about the problem with the Ice System, Plaintiff alleges LG informed her that
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she would have to empty the ice tray every day in order to prevent the Ice System
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from clogging. Id. When the Ice System clogged, Plaintiff alleges it sometimes
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18 caused the motor to burn out, and the refrigerator to become non-operational. Id.
19 ¶ 63.
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Additionally, Plaintiff claims the refrigerator would display various error

21 messages and simply stop working at times. Id. When Plaintiff contacted LG
22 about this problem, Plaintiff alleges LG instructed her to unplug the refrigerator for
23 at least 15 minutes and then plug it back in to reboot the refrigerator’s control
24 board. Id. On occasion, plaintiff alleges this process would have to be performed
25 multiple times in order to reboot the control board. Id. In order to reach the plug
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on the back of the refrigerator, Plaintiff states she had to move it out from the
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cupboard space and away from the wall every time she had to reboot the control
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board. Id. ¶ 13. When the refrigerator stopped working and when it was
unplugged to reboot the control board, the refrigerator was not being cooled by the
SCP system. Id. ¶ 12. This resulted in food spoiling and water from the melted
ice leaking onto the floor. Id.
Plaintiff further alleges that LG was aware of these problems. Plaintiff cites

7 several complaints from the internet, which purportedly should have put LG on
8 notice regarding the SCP system’s defects. See, e.g., id. ¶¶ 47, 57, 61, 75. Plaintiff
9 provides complaints made on several websites, including LG’s website, consumer
10 affairs, amazon.com, and complaintsboard.com. Id. Plaintiff contends LG was
11 aware of the problems with the Ice System because there were three complaints
12 regarding the Ice System posted to LG’s website prior to Plaintiff’s purchase of the
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refrigerator. Id. ¶ 57. Plaintiff suggests the complaints posted on other websites
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evidence the repeated calls made by customers to LG’s customer service line and
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LG’s refusal or inability to repair the reported problems with this model of
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refrigerator. Id. ¶¶ 47, 61, 75.
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Plaintiff claims LG never disclosed the extraordinary measures a consumer
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19 would need to take to keep the SCP system, the Ice System, and the refrigerator
20 itself operational. Plaintiff contends LG’s failure to disclose this information
21 resulted in Plaintiff and the proposed class purchasing LG refrigerators that they
22 would not have purchased otherwise, overpaying for the refrigerators, and/or
23 incurring additional operating expenses. Plaintiff further alleges the water that
24 leaked onto the floor when the frozen items melted caused a safety hazard and
25 damage to the floor. Plaintiff also contends the refrigerator’s operating problems
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required Plaintiff to throw out a significant amount of food that had spoiled, which
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caused Plaintiff monetary loss. Plaintiff contends other class members may have
suffered from these types of injuries as well.
In this action, Plaintiff seeks to represent several classes of purchasers.

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Specifically, Plaintiff identifies the following state and national classes:
a. All persons in California who purchased an LG refrigerator for home
use with the LG Smart Cooling Plus System (California SCP Class).

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b. All persons in California who purchased an LG refrigerator for home
use with the LG Slim SpacePlus™ Ice System (California Ice System
Class).

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c. All persons in California who purchased an LG refrigerator Model No.
LFX31925ST (California Model Class).

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d. All persons in the United States who purchased an LG refrigerator for
home use with the LG Smart Cooling Plus System (Nationwide SCP
Class).

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e. All persons in the United States who purchased an LG refrigerator for
home use with the LG Slim SpacePlus™ Ice System (Nationwide Ice
System Class).

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f. All persons in the United States who purchased an LG refrigerator
Model No. LFX31925ST (Nationwide Model Class).

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17 Plaintiff asserts six claims against LG on behalf of herself and the California
18 Classes: (1) violation of Consumer Legal Remedies Act (“CLRA”); (2) violation
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of the California Business & Professions Code § 17200 et seq. (“UCL”); (3)
violation of California Business & Professions Code § 17500 et seq. for false and
misleading advertising (“FAL”); (4) breach of express warranty; (5) breach of
implied warranty; and (6) violation of the Magnuson-Moss Warranty Act
(“MMWA”) (15 U.S.C. § 2301 et seq.). The sixth claim alleging violation of the

25 MMWA is the only claim asserted on behalf of the nationwide classes.
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MOTION TO DISMISS
I. Legal Standard
For a plaintiff to overcome a Rule 12(b)(6) motion, the complaint must
contain “enough facts to state a claim to relief that is plausible on its face.” Bell

6 Atl. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility when
7 the plaintiff pleads factual content that allows the court to draw the reasonable
8 inference that the defendant is liable for the misconduct alleged.” Ashcroft v.
9 Iqbal, 556 U.S. 662, 678 (2009). Factual pleadings merely consistent with a
10 defendant’s liability are insufficient to survive a motion to dismiss because they
11 only establish that the allegations are possible rather than plausible. See id. at
12 678-79. The court should grant 12(b)(6) relief only if the complaint lacks either a
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“cognizable legal theory” or facts sufficient to support a cognizable legal theory.
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See Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990).
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In addition, Rule 9(b) requires that the complaint “state with particularity the
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circumstances constituting fraud.” The Ninth Circuit has explained that
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18 “[a]verments of fraud must be accompanied by ‘the who, what, when, where, and
19 how’ of the misconduct charged.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097,
20 1106 (9th Cir. 2003) (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir.
21 1997)).
22 II. Discussion
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A. Plaintiff’s Standing to Sue on Behalf of the General Public

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LG argues Plaintiff has improperly alleged each of her claims on behalf of

25 “the general public.” Specifically, LG contends private citizens may not bring
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UCL and FAL claims on behalf of the general public. See Branick v. Downey Sav.
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and Loan Ass’n, 39 Cal. 4th 235, 240-41 (2006)(noting private persons may no
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longer sue under the UCL and FAL on behalf of the general public following
Proposition 64). LG further asserts Plaintiff may not bring a CLRA claim on
behalf of the general public because only consumers, meaning direct purchasers,
fall within the parameters of consumer remedies available under the CLRA. See

6 Schauer v. Mandarin Gems of Cal., Inc., 125 Cal. App. 4th 949, 960 (2005).
7 Lastly, LG contends Plaintiff may not bring warranty claims on behalf of the
8 general public because not all members of the general public are purchasers or
9 consumers of LG products. See Burr v. Sherwin Williams Co., 42 Cal. 2d 682,
10 695-96 (1954). For these reasons, LG asks the court to dismiss Plaintiff’s claims
11 brought on behalf of the “general public” with prejudice. Alternatively, LG asks
12 the court to strike the “general public” allegations pursuant to Federal Rule of Civil
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Procedure 12(f) as they are immaterial to Plaintiff’s claims as she does not seek
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relief on the general public’s behalf.
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Plaintiff contends LG’s objection is premature as the SAC expressly
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describes each claim as brought on behalf of Plaintiff individually and specifically17
18 named classes as indicated directly underneath the heading of each cause of action.
19 With regard to the UCL, Plaintiff contends she is not trying to bring an action as a
20 private attorney general under the UCL, and alleges that representative actions
21 remain available under the UCL subject to class action pleading. Plaintiff further
22 contends the injunctive relief sought through her UCL claim benefits the general
23 public because it stops a public harm. As to the CLRA, Plaintiff contends she may
24 seek injunctive relief as a private attorney general to enjoin future deceptive
25 practices on behalf of the general public. See Broughton v. Cigna Healthplans of
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Cal., 21 Cal. 4th 1066, 1080 (1999) abrogated on other grounds by AT&T
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Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011). However, Plaintiff makes
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no argument regarding her ability to bring breach of warranty claims, either express
or implied, on behalf of the general public.
While Plaintiff may pursue a representative claim on behalf of a particular
class under the UCL and FAL, California’s Proposition 64 eliminated UCL and

6 FAL suits on behalf of the general public unless they are brought by the Attorney
7 General or other public authority. See Branick, 39 Cal. 4th at 240-41; Friedman v.
8 24 Hour Fitness USA, Inc., 580 F. Supp. 2d 985, 994 (C.D. Cal. 2008) (citing Cal.
9 Bus. & Prof. Code § 17203); see also In re Tobacco II Cases, 46 Cal. 4th 298, 317
10 (2009). As a result, Plaintiff’s UCL and FAL claims may only be brought
11 individually and on behalf of the identified classes. The court therefore dismisses
12 Plaintiff’s UCL and FAL claims insofar as they are brought on behalf of the
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“general public” with prejudice and without leave to amend.
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In contrast to the UCL and FAL, the CLRA allows plaintiffs to enjoin a
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corporation’s deceptive or unlawful business practices throughout California on
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behalf of the general public. Meyer v. Sprint Spectrum L.P., 45 Cal. 4th 634, 645
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18 (2009); see also Friedman, 580 F. Supp. 2d at 994-95 (noting California case law
19 suggests “there is nothing defective about pleading a claim for injunctive relief
20 under the CLRA ‘on behalf of the general public’”)(citing Broughton, 21 Cal. 4th
21 at 1080). As Plaintiff’s CLRA claim seeks injunctive relief, it may be brought on
22 behalf of the general public.
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As for Plaintiff’s implied and express warranty claims, Plaintiff has not

24 provided any legal authority for allowing a purchaser of a product to bring breach
25 of warranty claims on behalf of the general public, many of whom have not
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purchased or used the product at issue. Plaintiff’s warranty claims do not seek
injunctive relief on behalf of consumers generally, but rather seek relief in the form

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of actual damages and rescission, relief which would be unrecoverable by nonpurchasers. Thus, having no basis for finding Plaintiff able to bring breach of
warranty claims on behalf of the general public, the court dismisses Plaintiff’s
breach of warranty claims brought on behalf of the general public with prejudice

6 and without leave to amend.
B. Fraud by Omission Claims
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LG alleges that Plaintiff's CLRA,1 UCL,2 and FAL3 claims should be

9 dismissed for failure to meet Rule 9(b)'s heightened pleading requirements because
10 these fraud based claims were not pled with the requisite specificity. Plaintiff
11 suggests the Rule 9(b) standards for pleading a fraud through omission claim “are
12 more relaxed.” However, as noted by the court in its previous order granting LG’s
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motion to dismiss, Plaintiff’s CLRA, UCL, and FAL claims are premised on fraud
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regardless of whether the claims allege affirmative misrepresentation or fraud
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The CLRA prohibits "unfair methods of competition and unfair or deceptive
24 acts or practices undertaken by any person in a transaction intended to result or which
results in the sale . . . of goods or services to any consumer." Cal. Civ. Code § 1770.
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The UCL prohibits "unlawful, unfair or fraudulent business act[s] or
26 practice[s]" and "unfair, deceptive, untrue or misleading advertising." Cal. Bus. &
Prof. Code § 17200.
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The FAL prohibits any "unfair, deceptive, untrue, or misleading advertising."
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through omission; therefore, Plaintiff’s claims must meet Rule 9(b)’s heightened
pleading requirement.4
Previously, the court dismissed Plaintiff’s fraud through omission claims as
alleged in the FAC because Plaintiff had failed to adequately define her class.

6 MTD Order at 8-9. While the FAC indicated that the class was based on the type
7 of technology in her refrigerator, the FAC did not explicitly define her class as
8 such. Accordingly, the court determined Plaintiff might have a valid claim if she
9 could appropriately define the class in the SAC.
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Whereas the FAC broadly defined the classes as all persons who purchased

11 LG refrigerators in either the United States or California, the SAC provides six
12 distinct classes based upon the model of the refrigerator, the SSP System, the Ice
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System, and the purchasers’ location. FAC ¶¶ 19-21; SAC ¶ 16. Unlike the
FAC’s overly broad class definition, the class definitions in the SAC clearly link
Plaintiff’s specific complaints regarding the technology used by LG to the classes
of individuals she seeks to represent. In light of these more explicit class

18 definitions, the SAC remedies the Rule 9(b) problem previously identified by the
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19 court. While LG does not contest whether Plaintiff’s redefinition of the proposed
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In the first amended complaint, Plaintiff’s fraud-based claims were premised
on two distinct theories with one theory based on alleged affirmative
misrepresentations made by LG and one theory based on LG’s alleged
misrepresentation by omission for failing to disclose material information to Plaintiff.
Plaintiff asserts the SAC only pleads claims based on LG’s alleged fraud through
omission. In response, LG asks that Plaintiff’s previous affirmative misrepresentation
claim be dismissed with prejudice. However, the court previously dismissed that claim
without prejudice, and Plaintiff has not realleged it here. Thus, as of now, there is no
affirmative misrepresentation claim to dismiss. Accordingly, the court limits its
analysis to the fraud by omission claim as alleged in the operative SAC.
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LG acknowledges that Plaintiff redefined her proposed classes in the SAC and
28 has not argued that the SAC’s class definitions are insufficient under Rule 9(b).
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classes satisfies Rule 9(b), LG raises several additional challenges to Plaintiff’s
fraud by omission claims
1. LG’s Actual Knowledge
First, LG argues that Plaintiff has not sufficiently alleged LG had knowledge

6 of the defects with the refrigerators using the SCP System and/or Ice System. LG
7 made a similar argument with regard to Plaintiff’s fraud by omission claim in the
8 FAC, and the court noted it did not find “LG’s arguments regarding knowledge
9 persuasive given that the LG refrigerators allegedly did not function at all rather
10 than having a smaller, harder to detect issue.” MTD Order at 9. Nevertheless, LG
11 argues the generalized complaints from various websites referenced in the SAC are
12 neither numerous nor consistent enough to suggest LG had knowledge of the
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specific problems with the refrigerators is insufficient under Rule 9(b).
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Contrary to LG’s assertion, Plaintiff has pled specific facts suggesting LG
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had knowledge of the problems alleged by Plaintiff. Notably, Plaintiff contends
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LG knew refrigerators containing the SCP System and/or Ice System did not work
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18 as intended based on the following factual allegations: (1) LG had developed a
19 “fix” to unplug the refrigerator in order to reboot the system when the SCP System
20 failed, (SAC ¶ 44); (2) the service technician sent to repair Plaintiff’s refrigerator
21 indicated the problems she was experiencing were common to LG refrigerators,
22 (SAC ¶ 44); (3) LG generates claim numbers for reported problems with its
23 products for tracking purposes, (SAC ¶ 45); (4) the warranty service providers used
24 by LG report the types of problems encountered and obtain necessary equipment,
25 instruction, and training to repair LG’s products, (SAC ¶ 46); and (5) the
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complaints posted on various websites indicate LG customers had made complaints
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to LG’s customer service line to complain prior to Plaintiff’s purchase of her
refrigerators, (SAC ¶ 47).
Based on these allegations, the court is unpersuaded by LG’s
characterization of the SAC as being too generalized to sufficiently plead

6 knowledge on the part of LG. When considering the totality of Plaintiff’s factual
7 allegations, the SAC suggests LG would have knowledge of problems with its
8 products through its ordinary process of tracking and receiving information from
9 its customer service line, warranty service providers, and complaints posted on its
10 own website. Accordingly, the court finds Plaintiff has adequately pled knowledge
11 with regard to the fraud by omission claims.6
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2. Plaintiff’s Reliance
LG also argues Plaintiff’s fraud by omission claims under the CLRA, UCL,
and FAL should be dismissed because she has not adequately pled that she relied
upon the allegedly fraudulent omissions made by LG.7 Reliance can be proven in a
fraudulent omission case by establishing that “had the omitted information been

18 disclosed, [the plaintiff] would have been aware of it and behaved differently.”
19 Boschma v. Home Loan Center, Inc., 198 Cal. App. 4th 230, 250-51 (2011)(citing
20 Mirkin v. Wasserman, 5 Cal. 4th 1082, 1093 (1993)). “[R]eliance is proved by
21 showing that the defendant's misrepresentation or nondisclosure was ‘an immediate
22 cause’ of the plaintiff's injury-producing conduct. A plaintiff may establish that the
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In LG’s motion to dismiss, LG argues Plaintiff’s UCL “unfair” claim also fails
because Plaintiff has not sufficiently pled knowledge as required to bring fraudulent
25 omission claims under the UCL and FAL. Insomuch as the court concludes Plaintiff
has sufficiently pled knowledge for her UCL and FAL claims, LG’s argument
26 regarding Plaintiff’s UCL “unfair” claim is moot.
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Because Plaintiff has not pled a fraud by misrepresentation claim in the SAC,
the court need not consider LG’s arguments regarding Plaintiff’s failure to establish
28 reliance on LG’s alleged misrepresentations.
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defendant's misrepresentation is an ‘immediate cause’ of the plaintiff's conduct by
showing that in its absence the plaintiff ‘in all reasonable probability’ would not
have engaged in the injury-producing conduct.” In re Tobacco, 46 Cal. 4th at 326
(citing Mirkin, 5 Cal. 4th at 1110–1111 (conc. & dis. opn. of Kennard, J.)).
LG argues Plaintiff has not established reliance because the SAC does not

7 allege Plaintiff saw any advertisement by LG prior to her purchase that could
8 possibly have contained the supposedly omitted information. See Daniel v. Ford
9 Motor Co., 2013 WL 2474934, at *5 (E.D. Cal. June 7, 2013)(concluding
10 plaintiff’s claim based on fraudulent omissions “must fail when [plaintiff] never
11 viewed a website, advertisement, or other material that could plausibly contain the
12 allegedly omitted fact”); Ehrlich v. BMW of N. Am., LLC, 801 F. Supp. 2d 908,
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920 (C.D. Cal. 2010)(dismissing plaintiff’s fraud through omission claims because
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plaintiff failed to allege how he would have been aware of any disclosures that
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defendant could have made).
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In response, Plaintiff contends actual reliance may be presumed or inferred
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18 when the alleged omissions are material. See In re Tobacco II Cases, 46 Cal. 4th at
19 328; Ehrlich, 801 F. Supp. 2d at 919. Plaintiff suggests that simply alleging she
20 would not have acted a certain way had she known all the facts is sufficient to
21 demonstrate reliance. See Kwikset Corp. v. Superior Court, 51 Cal. 4th 310, at
22 327-28 (2011). Here, Plaintiff contends she would not have purchased the
23 refrigerator had she known that she would have to continually unplug and replug it
24 to keep it operational and empty the ice tray on a daily basis in order for the Ice
25 System to function properly. Plaintiff contends these facts are sufficient to support
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her claims.
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LG’s reliance argument defies common sense and real-world business
practice. No refrigerator manufacturer would ever advertise its product to, in
essence, consistently fail due to repeated clogging of the ice system, frequent
problems with the cooling system necessitating control board rebooting, and

6 periods of nonoperation. Such advertising would be tantamount to an automobile
7 manufacturer advertising its vehicle routinely stalls in freeway traffic, or a wireless
8 telephone provider advertising a high rate of dropped calls. Such disclosures do
9 not exist in the real world because they represent product or service failure.
10 Product advertising is meant to identify and buttress product features and value, not
11 denigrate and diminish those qualities. Under the unusual circumstances pled in
12 this case, reliance may be established by LG’s alleged failure to disclose at the
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point of purchase the alleged defects which, if true, would seem to negate the
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inherent purpose of the product.
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For these reasons, the court concludes Plaintiff has sufficiently alleged
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knowledge and reliance as required to bring CLRA, UCL, and FAL claims.
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18 Accordingly, LG’s motion to dismiss Plaintiff’s fraud-based claims is denied.
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The court notes LG raises several new arguments regarding Plaintiff’s fraud24 based claims for the first time in its reply brief. LG Reply at 3-5 (alleging Plaintiff
failed to adequately plead active concealment, partial representation, and safety defect).
25 However, “arguments not raised by a party in its opening brief are deemed waived.”
United States v. Romm, 455 F.3d 990, 997 (9th Cir. 2006) (citing Smith v. Marsh, 194
26 F.3d 1045, 1052 (9th Cir. 1999)); see also Bazuaye v. INS, 79 F.3d 118, 120 (9th
Cir.1996) (“Issues raised for the first time in the reply brief are waived.”). As these
27 arguments were not raised in LG’s opening brief, the court declines to consider them
here.
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C. Warranty-Based Claims
1. Breach of Express Warranty
A manufacturer is "not liable for breach of express warranty merely because
a product manifests recurring failures during the warranty period. Rather, the

6 question is whether [a plaintiff] sought repairs, refunds, or replacements and, if so,
7 whether [the manufacturer] responded appropriately under the warranty." Kent v.
8 Hewlett-Packard Co., 2010 U.S. Dist. LEXIS 76818, at *15-16 (2010). However,
9 irrespective of whether a manufacturer has responded appropriately under the
10 warranty, "an express warranty covering 'materials and workmanship' does not
11 include design defects." See, e.g., Horvath v. LG Elecs. MobileComm U.S.A., Inc.,
12 2012 WL 2861160, at *4 (S.D. Cal. Feb. 13, 2012); Gertz v. Toyota Motor Corp.,
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2011 WL 3681647, at *3 (C.D. Cal. Aug. 22, 2011) (dismissing express warranty
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claim where warranty did not extend to design defects); Brothers v.
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Hewlett-Packard Co., 2007 WL 485979, at *4 (N.D. Cal. Feb. 12, 2007) (rejecting
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a breach of express warranty claim for a design defect because the warranty
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18 guaranteed against defects in "materials and workmanship").
19

LG’s express warranty contains the following language: “[s]hould your LG

20 Refrigerator (“Product”) fail due to a defect in materials or workmanship under
21 normal home use, during the warranty period set forth below, LG will at its option
22 repair or replace the product.” SAC ¶ 98. Based on this language, the court
23 previously dismissed Plaintiff’s breach of warranty claim as alleged in the first
24 amended complaint because “it [was] unclear what defect, other than a design
25 defect, the LG refrigerators allegedly suffered from.” MTD Order at 10. As a
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result, the court concluded Plaintiff had not sufficiently pled a “materials or
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workmanship” defect covered by the express warranty. Id. “If anything, multiple
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repairs of the same part suggest[ed] that the defect could not be remedied by
properly assembling the LG refrigerators with non-defective parts.” Id. Thus, the
court warned that Plaintiff would need to be more explicit regarding the LG
refrigerators’ non-design based defects in order to allege a viable breach of express

6 warranty claim. Id.
In the instant motion, LG argues Plaintiff has not remedied these deficiencies
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8 in the SAC and instead continues to allege a design defect that is not covered by
9 the express warranty. Specifically, LG argues the SAC suggests the alleged defects
10 Plaintiff experienced could not be resolved with non-defective parts and therefore
11 suggest a design defect inherent to the refrigerator, not just the particular unit
12 Plaintiff purchased. See McCabe v. Am. Honda Motor Co., Inc., 100 Cal. App. 4th
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1111, 1120 (2002)(noting manufacturing defects exist “when an item is produced
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in a substandard condition” and “is often demonstrated by showing the product
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performed differently from other ostensibly identical units of the same product
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line,” whereas a design defect “exists when the product is built in accordance with
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18 its intended specifications, but the design itself is inherently defective”).
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In response, Plaintiff argues the SAC alleges with more particularity the

20 multiple problems she experienced with different parts within the Ice System, the
21 SCP System, and throughout the entire refrigerator. Plaintiff contends she is not
22 required to prove whether these problems are design defects or problems with
23 materials and workmanship at this stage in the litigation as it would be impossible
24 to do so without access to LG’s discoverable information. Rather, Plaintiff
25 contends the SAC need only plausibly allege the refrigerator’s problems were
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caused by LG’s defective materials or workmanship. Additionally, Plaintiff
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contends LG’s failure to repair these problems constitutes a breach of LG’s express
warranty for materials or workmanship.
Having reviewed Plaintiff’s factual allegations in the SAC, the court agrees
with LG that Plaintiff’s express warranty claim alleges a design defect rather than a

6 defect in materials or workmanship. As a basis for her class action claims, Plaintiff
7 alleges other purchasers of this particular model of LG refrigerator as well as
8 purchasers of any LG refrigerators containing an SCP System or Ice System
9 “suffered similar injuries” as a result of the same problems she experienced.
10 Plaintiff also contends LG knew about the problems she was encountering because
11 other consumers had reported similar problems to their customer service
12 department and posted complaints on numerous websites. Plaintiff further alleges
13
the service technician sent to repair her refrigerator indicated to her that the types
14
of problems she experienced were common to LG refrigerators. Taken as a whole,
15
these factual allegations suggest her refrigerator, and other LG refrigerators like
16
hers, suffered from an overall design defect rather than a problem with materials or
17
18 workmanship. Plaintiff argues the SAC sufficiently alleges a material or
19 workmanship problem by alleging with more particularity the problems she
20 experienced with different parts of the refrigerator, but she has not provided any
21 allegations suggesting that the materials used were defective or because the
22 materials were assembled in a shoddy or otherwise improper manner. See Horvath,
23 2012 WL 2861160, at *5 (S.D. Cal. 2012).
24
In sum, it remains unclear what defect, other than a design defect, the LG
25 refrigerators allegedly suffered from. As a result, Plaintiff has not sufficiently
26
alleged that her refrigerator suffered from defects in materials or workmanship
27
such that LG had an obligation to repair or replace the refrigerator pursuant to the
28
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7

express warranty. Accordingly, Plaintiff’s breach of express warranty claims are
dismissed for failure to state a claim without leave to amend at this juncture.
Should discovery produce evidence indicating an express warranty claim is viable,
the court will entertain a motion to amend the operative complaint.
2. Breach of Implied Warranty
Under California law, the implied warranty of merchantability means that

8 consumer goods: “(1) Pass without objection in the trade under the contract
9 description; (2) Are fit for the ordinary purposes for which such goods are used;
10 (3) Are adequately contained, packaged, and labeled; [and] (4) Conform to the
11 promises or affirmations of fact made on the container or label.” Cal. Civ. Code §
12 1791.1. “[A] warranty that the goods shall be merchantable is implied in a contract
13
for their sale if the seller is a merchant with respect to goods of that kind . . . .
14
Goods to be merchantable must be . . . fit for the ordinary purposes for which such
15
goods are used . . . .” Cal. Com. Code § 2314. A plaintiff claiming breach of an
16
implied warranty of merchantability must show that the product “did not possess
17
18 even the most basic degree of fitness for ordinary use.” Mocek v. Alfa Leisure,
19 Inc., 114 Cal. App. 4th 402, 406 (2003).
In the SAC, Plaintiff alleges breach of implied warranty under the Song20
21 Beverly Act, Cal. Civ. Code § 1790 et seq., California Commercial Code Section
22 2314, and California common law. Specifically, Plaintiff claims LG breached the
23 implied warranty of merchantability by selling this model of refrigerator and other
24 refrigerators with the SCP System and the Ice System despite knowing these
25 products were not fit for the ordinary purposes for which they were intended and
26
used. Plaintiff contends any waiver or limits placed upon the implied warranties by
27
Defendant are unconscionable, illegal, and unenforceable because Plaintiff and the
28
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California class members had no meaningful choice in determining those
limitations.
LG argues the SAC fails to state an implied warranty claim for two reasons.
First, LG contends Plaintiff does not stand in vertical privity with LG as required to

6 assert a breach of implied warranty claim. Second, LG argues it disclaimed any
7 implied warranties of merchantability within its express warranty, and Plaintiff has
8 failed to allege a basis for finding this disclaimer unenforceable.
9
10

a. Implied Warranty Claim Under the Song-Beverly Act
Under the Song-Beverly Act, every retail sale of “consumer goods” in

11 California includes an implied warranty by the manufacturer and the retail seller
12 that the goods are “merchantable” unless the goods are expressly sold “as is” or
13
14
15
16
17

“with all faults.” Cal. Civ. Code §§ 1791.3, 1792. Merchantability, for purposes of
the Song–Beverly Act, means that the consumer goods: “(1) “[p]ass without
objection in the trade under the contract description,”(2) “[a]re fit for the ordinary
purposes for which such goods are used,” (3) “[a]re adequately contained,

18 packaged, and labeled,” and (4) “[c]onform to the promises or affirmations of fact
19 made on the container or label.” Cal. Civ. Code § 1791.1. “ ‘The core test of
20 merchantability is fitness for the ordinary purpose for which such goods are used.’”
21 Mexia v. Rinker Boat Co., 174 Cal. App. 4th 1297, 1303 (2009)(quoting Isip v.
22 Mercedes–Benz USA, LLC, 155 Cal. App. 4th 19, 26 (2007)). “Such fitness is
23 shown if the product is in safe condition and substantially free of defects....” Elias
24 v. Hewlett-Packard Co., 903 F. Supp. 2d 843, 852 (N.D. Cal. 2012)(internal
25 quotation marks and citations omitted).
26
///
27
///
28
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i. Vertical Privity
LG’s argues that California law requires vertical privity for all breach of
implied warranty claims. For this proposition, LG relies primarily on Clemens v.
DaimlerChrysler Corp., 534 F.3d 1017, 1023 (9th Cir. 2008). In Clemens, the

6 Ninth Circuit recognized California Commercial Code section 2314 requires
7 vertical contractual privity between the plaintiff and the defendant, meaning they
8 are in “adjoining links of the distribution chain.” Id. Pursuant to this rule, the
9 Ninth Circuit concluded an end consumer who purchases a product from a retailer
10 is not in privity with a manufacturer as required to bring an implied warranty claim
11 under section 2314. Id.; Osborne v. Subaru of Am., Inc., 198 Cal. App. 3d 646,
12 656 n. 6 (1988).
13
However, Plaintiff argues Clemens only considered implied warranty claims
14
brought under the California Commercial Code and not implied warranty claims
15
brought under the Song-Beverly Act. Therefore, Plaintiff argues Clemens is
16
inapposite to the court’s consideration of her Song-Beverly Act implied warranty
17
18 claim. See Keegan v. Am. Honda Motor Co., Inc., 838 F. Supp. 2d 929, 947 n. 54
19 (C.D. Cal. 2012)(noting Clemens analyzes the privity requirements under
20 California’s general implied warranty laws rather than claims under the Song21 Beverly Act). Rather than relying upon Clemens, Plaintiff asks this court to follow
22 other courts that have considered implied warranty claims under the Song-Beverly
23 Act specifically and concluded the statutory language does not impose a privity
24 requirement. Keegan v. Am. Honda Motor Co., Inc., 838 F. Supp. 2d 929, 946-47
25 (C.D. Cal. 2012)(citing several cases from California district courts holding the
26
Song-Beverly Act does not impose a vertical privity requirement); Ehrlich v. BMW
27
of N. Am., LLC, 801 F. Supp. 2d 908, 921 (C.D. Cal. 2010); Gonzales v. Drew
28
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Indus., Inc., 750 F. Supp. 2d 1061, 1072 (C.D. Cal. 2007); Gusse v. Damon Corp.,
470 F. Supp. 2d 1110, 1116 n. 9 (C.D. Cal. 2007).
The court agrees with Plaintiff’s assessment of the Ninth Circuit’s decision

4
5

in Clemens. The Ninth Circuit in Clemens tailored its analysis of the vertical

6 privity requirement to implied warranty claims brought under California
7 Commercial Code Section 2314. The Song-Beverly Act is never mentioned, either
8 generally or with regard to its specific provisions. As a result, Clemens provides
9 little guidance regarding implied warranty claims brought under the Song-Beverly
10 Act. As a result, the court finds more persuasive the weight of authority
11 considering the Song-Beverly Act and finding the statutory language does not
12 impose a vertical privity requirement like that required under the California
13
Commercial Code. Similarly, this court rejects LG’s argument that vertical privity
14
is required to bring an implied warranty claim under the Song-Beverly Act.
15
ii. Disclaimer of Implied Warranty
16
Under section 1792.3 of the Song-Beverly Act, implied warranties of
17
18 merchantability and fitness may only be waived when the sale of consumer goods
19 is made on an “as is” or “with all faults” basis. As set forth in the court’s previous
20 order, LG’s express warranty was included in the refrigerator’s owner manual, and
21 contained the following language that LG argues sufficiently disclaimed any
22 implied warranties of merchantability or fitness for a particular purpose:
23
24
25
26

THIS WARRANTY IS IN LIEU OF ANY OTHER WARRANTY,
EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION
ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. TO THE EXTENT ANY IMPLIED
WARRANTY IS REQUIRED BY LAW IT IS LIMITED IN
DURATION TO THE EXPRESS WARRANTY PERIOD ABOVE.

27 / / /
28 / / /
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MTD Order at 12-13. The SAC alleges that LG’s disclaimer of implied warranties
under the Song-Beverly Act is invalid under California Civil Code §§ 1790.1,
1791.3, and 1792.3 because the disclaimer did not provide that the LG Model
refrigerator, SCP System, and Ice System were being sold “as is” or “with all

6 faults.” SAC ¶ 122; see Mocek v. Alfa Leisure, Inc., 114 Cal. App. 4th 402, 409
7 (2003)(noting the Song-Beverly Act gives greater protections to consumers than
8 the California Commercial Code by specifically prohibiting a waiver of the implied
9 warranty of merchantability, except where the sale is “as is”). LG does not
10 specifically address this new allegation in its motion to dismiss or reply brief.
11
In order to disclaim the implied warranty of merchantability and fitness
12 under the Song-Beverly Act, the seller or manufacturer must provide the buyer
13
with a conspicuous writing attached to the goods which clearly informs the buyer,
14
prior to the sale, that the goods are being sold on an “as is” or “with all faults”
15
basis. Cal. Civ. Code §§ 1792.4(a)(1), (3)(detailing requirements for disclaimers of
16
implied warranties on “as is” or “with all faults” sales). Based on this clear
17
18 statutory language and the intended purpose of the Song-Beverly Act to afford
19 greater protections to consumers, the court concludes LG did not sufficiently
20 disclaim the implied warranty of merchantability and fitness for a particular
21 purpose under the Song-Beverly Act. LG’s disclaimer makes no mention of the
22 sale being “as is” or “with all faults,” and is therefore insufficient under section
23 1792.4. Notably, LG has not offered any argument to the contrary.
24
In sum, the Song-Beverly Act does not require vertical privity to bring an
25 breach of implied warranty claim and LG failed to comply with the disclaimer
26
requirements under sections 1792.3 and 1792.4 of the Song-Beverly Act.
27
///
28
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Accordingly, the court denies LG’s motion to dismiss Plaintiff’s breach of implied
warranty claim under the Song-Beverly Act.
b. California Commercial Code § 2314
i. Vertical Privity and Third-Party Beneficiaries
While the Song-Beverly Act does not require vertical privity for a breach of

7 implied warranty claim, it is generally accepted that vertical privity is required for
8 breach of implied warranty claims brought under California Commercial Code
9 Section 2314. See Clemens, 534 F. 3d at1023; In re Toyota Motor Corp.
10 Unintended Acceleration Marketing, Sales Practices, and Products Liability
11 Litigation, 754 F. Supp. 2d 1145, 1184 (C.D. Cal. 2010). LG argues Plaintiff’s
12 implied warranty claim should be dismissed because she does not stand in vertical
13
privity with LG as required by California law. LG further contends that Plaintiff
14
does not fall within the limited third-party beneficiary exception to the vertical
15
privity requirement because Plaintiff failed to allege that she was an intended third16
party beneficiary of any agreement between LG and the retail seller of the
17
18 refrigerator. Moreover, LG argues the Ninth Circuit rejected the third-party
19 beneficiary exception to the vertical privity requirement in Clemens. See 534 F.3d
20 at 1024.
21

Plaintiff does not dispute the existence of a vertical privity requirement, but

22 instead contends the third-party beneficiary exception applies. Under California
23 Civil Code section 1559, a third-party beneficiary may enforce a contract made
24 expressly for his or her benefit. See also In re Toyota Motor Corp., 754 F. Supp.
25 2d at 1184. “A contract made ‘expressly’ for a third party's benefit need not
26
specifically name the party as the beneficiary; to be deemed a third-party
27
beneficiary, one need only to have experienced more than an incidental benefit
28
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from the contract.” Id. (citing Gilbert v. Steelform Contracting Co., 82 Cal. App.
3d 65, 69 (1978)). Relying primarily upon the court’s analysis in In re Toyota
Motor Corp., Plaintiff contends “the clear weight of authority compels a conclusion
that where plaintiffs successfully plead third-party beneficiary status, they

9
6 successfully plead a breach of implied warranty claim.” In re Toyota Motor Corp.,
7 754 F. Supp. 2d at 1184-85 (citing Gilbert, 82 Cal. App. 3d at 69 (finding that a

8 homeowner, as a third-party beneficiary of a subcontractor's warranty in favor of
9 the contractor who performed work on a residence, could maintain a breach of
10 implied warranty claim against subcontractor notwithstanding the lack of privity
11 between the homeowner and the subcontractor). Because LG knew the retailers to
12 whom it sold the refrigerators were not going to own the refrigerators any longer
13
than it took to sell them to Plaintiff and the California Classes, Plaintiff argues LG
14
intended the warranties to benefit Plaintiff and the California Classes as third-party
15
beneficiaries. As further support for this argument, Plaintiff points to the following
16
factual allegations: LG contracts with third-party repair companies to provide
17
18 repairs to purchasers of their products from retailers; LG provides a phone number
19
20
21
22
23
24
25
26
27
28

9

See also Arnold v. Dow Chemical Co., 91 Cal. App. 4th 698, 720 (2001)
(finding, based on the fact that distributors and retailers were not intended to be the
ultimate consumers, that plaintiff could maintain breach of implied warranty claim
notwithstanding the lack of privity with manufacturer of pesticide); Cartwright v.
Viking Industries, Inc., 249 F.R.D. 351, 356 (E.D. Cal. 2008) (relying on Gilbert and
concluding that plaintiffs were, as third-party beneficiaries, entitled to maintain a
breach of implied warranty claim against the manufacturer where plaintiffs, not the
distributors, were the intended consumers); In re Sony VAIO Computer Notebook
Trackpad Litigation, 2010 WL 4262191, at *3 (S.D. Cal. Oct. 28, 2010) (holding that
the facts as pled by plaintiffs—that the retailer from which they purchased defective
products was the manufacturer's authorized retailer and service facility—precluded
dismissal of a breach of implied warranty claim for lack of privity); The NVIDIA GPU
Litigation, 2009 WL 4020104, at *6–7 (N.D. Cal. Nov. 19, 2009) (finding, without
elaboration, vertical privity requirement precluded breach of implied warranty claim
against computer component manufacturer by purchasers of computers into which the
component was incorporated because of the lack of allegations of a contract to which
the computer purchasers were third-party beneficiaries)).
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for purchasers to call and report problems; and LG sent service technicians to
perform warranty repairs on Plaintiff’s refrigerator.
The court finds Plaintiff has sufficiently pled third-party beneficiary status as
required to avoid the vertical privity requirement under California Commercial

6 Code Section 2314. As Plaintiff suggests, several other courts have concluded
7 implied warranty claims may be brought under California Commercial Code
8 Section 2314 by the intended consumers of a product as third-party beneficiaries of
9 the contract between the manufacturer and the authorized seller of the product.10
10 Here, Plaintiff alleges LG sells its products through a network of authorized dealers
11 that were not the intended beneficiaries of the express and implied warranties
12 associated with LG’s products. Plaintiff has sufficiently alleged that she and the
13
California classes were intended third-party beneficiaries of LG’s warranty
14
agreements. Accordingly, the lack of vertical privity does not require dismissal of
15
Plaintiff’s implied warranty claim under California Commercial Code Section
16
2314.
17
ii. Disclaimer of Implied Warranty
18
19

Under California Commercial Code Section 2316, the implied warranty of

20 merchantability under California Commercial Code Section 2314 may be excluded
21 or modified if the language expressly mentions merchantability and is conspicuous.
22 As noted above with regard to the implied warranty under the Song-Beverly Act,
23 LG’s express warranty was included in the refrigerator’s owner manual, and
24
25
26

10

To the extent LG argues the Ninth Circuit rejected the existence of a thirdparty beneficiary exception in Clemens, the court disagrees. In Clemens, the Ninth
27
Circuit did not specifically consider the third-party beneficiary exception or cases that
28 have adopted the third-party beneficiary exception.
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11

contained the following language that LG argues sufficiently disclaimed any
implied warranties of merchantability or fitness for a particular purpose:
THIS WARRANTY IS IN LIEU OF ANY OTHER WARRANTY,
EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION
ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. TO THE EXTENT ANY IMPLIED
WARRANTY IS REQUIRED BY LAW IT IS LIMITED IN
DURATION TO THE EXPRESS WARRANTY PERIOD ABOVE.
MTD Order at 12-13.
Plaintiff contends LG’s disclaimer should be found invalid as it was not
conspicuous as required by California Uniform Commercial Code Section 2316(2).
SAC ¶ 123. Under California law, any disclaimer or modification of a warranty

12 must be strictly construed against the seller. Hauter v. Zogarts, 14 Cal. 3d 104, 119
13 (1975). Disclaimers of implied warranties must be made available to the consumer
14 prior to the sale of the product in order to be binding on the consumer. See
15 Dorman v. Int’l Harvester Co., 46 Cal. App. 3d 11, 19-20 (1975)("A disclaimer of
16 warranties must be specifically bargained for so that a disclaimer in a warranty
17 given to the buyer after he signs the contract is not binding."); Western Emulsions,
18 Inc. v. BASF Corp., 2007 WL 1839718, at * (C.D. Cal. 2007)(finding disclaimer of
19
20
21
22
23
24

warranties contained in printed materials provided after purchase void since the
disclaimers were not bargained for in the agreement between the parties). In the
SAC, Plaintiff alleges the product manual was packed inside the refrigerator box
and was not provided to her until after her purchase of the refrigerator. SAC ¶ 123.
She further alleges the warranty disclaimer was not posted on the refrigerator, and

25 no one mentioned it to her at the time of purchase. Id.
In response, LG argues Plaintiff conflates the concepts of conspicuousness,
26
27 as required by California Uniform Commercial Code Section 2316(2) with a lack
28 of notice of the disclaimer of implied warranties. LG contends its disclaimer is
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sufficiently conspicuous under Section 2316(2) because Plaintiff has not alleged
the disclaimer is not in writing, does not mention the implied warranties of
merchantability or fitness, or does not appear in all capital letters. LG suggests
these are the only requirements for conspicuousness under the statute, and they

6 have been met. With regard to Plaintiff’s lack of notice argument, LG contends
7 Plaintiff’s allegation that she was unable to view the disclaimer prior to purchasing
8 the refrigerator “is insufficient to undo the binding terms of the warranty” where
9 Plaintiff was able to review the warranty after purchase and could return the
10 product if dissatisfied with the warranty’s limitations. See Berenblat v. Apple, Inc.,
11 2010 WL 1460297, at *4 (N.D. Cal. Apr. 9, 2010); Tietsworth v. Sears, Roebuck
12 and Co., 2009 WL 3320486, at *10 (N.D. Cal. Oct. 13, 2009). LG contends the
13
SAC fails to allege that Plaintiff attempted to return the refrigerator after reviewing
14
the warranty, but could not.
15
Regardless of whether Plaintiff’s objection to the disclaimer is framed as an
16
issue of conspicuousness or lack of notice, the essence of her argument remains the
17
18 same. Plaintiff contends LG’s failure to provide her with the disclaimer of implied
19 warranties prior to her purchase of the refrigerator invalidates the disclaimer, and
20 this court agrees. The California Commercial Code considers a disclaimer to be
21 “conspicuous” if it “so written, displayed, or presented that a reasonable person
22 against whom it is to operate ought to have noticed it.” Cal. Comm. Code §
23 1201(10). As noted by the court in Dorman, the purpose of the conspicuousness
24 requirement was “to protect a buyer from [u]nexpected and unbargained language
25 of disclaimer by denying effect to such language when inconsistent with language
26
of express warranty and permitting the exclusion of implied warranties only by
27
conspicuous language or other circumstances which protect the buyer from
28
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surprise.” Based on Plaintiff’s allegations, there would have been no way for
Plaintiff to have noticed the disclaimer prior to receiving the product manual when
the refrigerator was delivered. The facts as alleged by Plaintiff suggest she was
surprised by the terms of the express warranty as she was unable to view the

6 disclaimer before purchasing the refrigerator. MTD Order at 14. In this instance,
7 LG’s disclaimer seems to be exactly the type of “[u]nexpected and unbargained
8 language” that the conspicuousness requirement was designed to prevent.
9

Defendant provides some authority from the Northern District of California

10 suggesting a disclaimer need not be provided prior to purchase if the purchasers
11 “were able to review the warranty upon purchase and to return the product if they
12 were dissatisfied with the warranty’s limitations.” See Kowalsky v.
13
Hewlett-Packard Co., 771 F. Supp. 2d 1138, 1156 (N.D. Cal. 2010) vacated in part
14
on other grounds 771 F. Supp. 2d 1156 (N. D. Cal. 2011); Berenblat, 2010 WL
15
1460297, at *4; Tietsworth, 2009 WL 3320486, at *10. However, the court is more
16
inclined to follow the state court’s ruling and rationale as articulated in Dorman for
17
18 the reasons set forth above. Additionally, the conclusion in Dorman reflects
19 important policy considerations as articulated by other courts across the country
20 when considering the effect of post-sale disclaimers of implied warranties under
21 the Uniform Commercial Code.11 See generally 18 Williston on Contracts § 52:81
22
23
24
25
26
27
28

11

Moreover, the proffered cases from the Northern District are individually
distinguishable from the facts as alleged by Plaintiff in the SAC. See Kowalsky, 771
F. Supp. 2d at 1156 vacated in part on other grounds, 771 F. Supp. 2d 1156 (N. D. Cal.
2011)(plaintiff acknowledged that the Limited Warranty, which contained the
disclaimer, was available on the defendant’s website where he purchased the product);
Berenblat, 2010 WL 1460297, at *4 (named plaintiffs had not alleged that they
themselves did not receive pre-sale notice of the warranty); Tietsworth, 2009 WL
3320486, at *10 (plaintiffs admitted that they were provided with a ninety day period
in which to return the Machines "for any reason"); see also In re iPhone 4S Consumer
Litigation, 2013 WL 3829653, at *16 (N.D. Cal. July 23, 2013)(noting that plaintiffs
had not pled the existence of an unqualified return period and defendant provided no
evidence of such a period of which the Court can properly take judicial notice).
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(4th ed.)(listing cases in which courts have generally held “disclaimers of implied
warranties that are made after the sale has been consummated, such as when given
to the buyer on or after delivery of the goods, in an invoice, receipt, product
manual, or similar instrument, are ineffectual unless the buyer is chargeable with

6 knowledge of the disclaimers and may be said to have assented to them.”); 1 The
7 Law of Prod. Warranties § 8:8 (noting “courts generally nullify such post-contract
8 disclaimers” of implied warranties).
9

Taking all factual allegations as true and drawing all reasonable inferences

10 drawn in Plaintiff’s favor, the court concludes Plaintiff has sufficiently alleged
11 LG’s disclaimer of implied warranties is invalid. Accordingly, LG’s disclaimer
12 does not require dismissal of Plaintiff’s implied warranty claim under California
13
Commercial Code Section 2314. Insomuch as Plaintiff has sufficiently alleged
14
third-party beneficiary status and the invalidity of LG’s disclaimer, the court denies
15
LG’s motion to dismiss Plaintiff’s implied warranty claim under California
16
Commercial Code Section 2314.
17
c. Disclaimer of Damages for Plaintiff’s Implied Warranty Claims
18
LG also argues the disclaimer in the express warranty properly disclaimed

19

20 special, punitive, and consequential damages for Plaintiff’s warranty-based claims.
21 The express warranty provides:
22

NEITHER THE MANUFACTURER NOR ITS U.S. DISTRIBUTOR
SHALL BE LIABLE FOR ANY INCIDENTAL, CONSEQUENTIAL,
INDIRECT, SPECIAL, OR PUNITIVE DAMAGES OF ANY NATURE,
INCLUDING WITHOUT LIMITATION, LOST REVENUES OR
PROFITS, OR ANY OTHER DAMAGE WHETHER BASED IN
CONTRACT, TORT, OR OTHERWISE.

23
24
25
26
27

///
///

28
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Absent unconscionability, LG argues California law authorizes disclaimers such as
these pursuant to California Commercial Code Section 2719(3).12 Because Plaintiff
fails to sufficiently allege unconscionability, LG contends her claims for
disclaimed damages should be dismissed.13

6

1. Song-Beverly Act Implied Warranty Claim

7

Plaintiff argues LG’s disclaimer of damages for an implied warranty claim

8 under the Song-Beverly Act is unenforceable because the Song-Beverly Act
9 specifically provides for recovery of “damages and other legal and equitable
10 relief.” Cal. Civ. Code § 1794(a); Martinez v. Kia Motors Am., Inc., 193 Cal. App.
11 4th 187, 193-94 (2011). “Any waiver by the buyer of consumer goods of the
12 provisions of [the Song-Beverly Consumer Warranty Act], except as expressly
13
provided [by the Song-Beverly Consumer Warranty Act], shall be deemed contrary
14
to public policy and shall be unenforceable and void.” Cal. Civ. Code § 1790.1.
15
Accordingly, Plaintiff contends the Song-Beverly Act should be applied in such a
16
way that provides its full, protective benefits to the consumer. See Music
17
18 Acceptance Corp. v. Lofing, 32 Cal. App. 4th 610, 619 (1995). Notably, LG has
19 not specifically addressed Plaintiff’s arguments regarding the permissibility of
20 disclaiming damages under the Song-Beverly Act.
21
22
23

12

“ Consequential damages may be limited or excluded unless the limitation or
24 exclusion is unconscionable. Limitation of consequential damages for injury to the
person in the case of consumer goods is invalid unless it is proved that the limitation
25 is not unconscionable. Limitation of consequential damages where the loss is
commercial is valid unless it is proved that the limitation is unconscionable.” Cal.
26 Comm. Code § 2719(3).
13
Neither party makes a specific argument regarding LG’s ability to disclaim
27
damages for Plaintiff’s breach of express warranty claim. However, as the express
28 warranty claims have been dismissed, the issue of damages for these claims is now
moot.
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The court finds LG’s disclaimer of damages unenforceable with regard to
Plaintiff’s breach of implied warranty claim under the Song-Beverly Act. The
Song-Beverly Act expressly allows for recovery of incidental and consequential
damages. See Cal. Civ. Code § 1794(b)(2) (measure of buyer's damages where

6 goods have been accepted includes Sections 2714 and 2715 of the California
7 Commercial Code); Cal. Com. Code § 2714(3) (“In a proper case any incidental
8 and consequential damages under Section 2715 also may be recovered.”); Cal.
9 Com. Code § 2715 (buyer's incidental and consequential damages); see also Cal.
10 Civ.Code §§ 1793.2(d)(2)(A), (B) (“The manufacturer also shall pay for ... any
11 incidental damages to which the buyer is entitled under Section 1794, including,
12 but not limited to, reasonable repair, towing, and rental car costs actually incurred
13
by the buyer.”). The Song-Beverly Act also provides for recovery of punitive
14
damages in cases of willful breach. Brilliant v. Tiffin Motor Homes, Inc., 2010
15
WL 2721531, at *3 (citing Romo v. FFG Insurance Co., 397 F. Supp. 2d 1237,
16
1240 (C.D. Cal. 2005) (noting Song-Beverly Act civil penalties provision in Cal.
17
18 Civ. Code § 1794(c) are akin to punitive damages)). As noted by Plaintiff, the
19 provisions of the Song-Beverly Act may not be waived as a general matter. See
20 Cal. Civ. Code § 1790.1; see also Gusse v. Damon Corp., 470 F. Supp. 2d 1110,
21 1117-18. Insomuch as Plaintiff has properly alleged an implied warranty claim
22 under the Song-Beverly Act, the court concludes LG’s disclaimer of damages is
23 unenforceable as to this claim.
24
2. California Commercial Code Implied Warranty Claim
25
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Plaintiff also contends that LG’s attempted disclaimer of damages is
unconscionable and is therefore unenforceable under California Commercial Code
section 2719(3). Under this provision, consequential damages may be limited or

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excluded unless the limitation or exclusion is unconscionable. Cal. Com. Code §
2719(3).
The unconscionability alleged by Plaintiff has both a procedural and a
substantive element. See Aron v. U–Haul Co. of Ca., 143 Cal. App. 4th 796, 808

6 (2006) (citing Armendariz v. Foundation Health Psychcare Services, Inc., 24 Cal.
7 4th 83, 114 (2000)). “The procedural element focuses on factors of oppression and
8 surprise.” Berenblat, 2010 WL 1460297, at *4. “The oppression component arises
9 from an inequality of bargaining power of the parties to the contract and an absence
10 of real negotiation or a meaningful choice on the part of the weaker party.” Kinney
11 v. United Healthcare Servs., 70 Cal. App. 4th 1322, 1329 (1999). “‘Surprise’
12 involves the extent to which the supposedly agreed-upon terms of the bargain are
13
hidden in a prolix printed form drafted by the party seeking to enforce the disputed
14
terms.” A & M Produce Co. v. FMC Corp., 135 Cal. App. 3d 473, 486 (1982). In
15
contrast to the procedural element of oppression and surprise, “[t]he substantive
16
element of unconscionability focuses on the actual terms of the agreement and
17
18 evaluates whether they create ‘overly harsh’ or ‘one-sided’ results as to ‘shock the
19 conscience.’” Aron, 143 Cal. App. 4th at 809.
As noted in the court’s previous order dismissing Plaintiff’s claims,
20
21 Plaintiff’s pleadings suggest that her LG refrigerator did not meet the most basic
22 degree of fitness for its standard use. The court concluded such inability to use the
23 LG refrigerator for its intended purpose suggests that substantive unconscionability
24 may exist. MTD Order at 14. Having reviewed the SAC, the court concludes
25 Plaintiff has sufficiently alleged the disclaimer of damages was procedurally
26
unconscionable. As noted, Plaintiff appears to have been surprised by the terms of
27
her LG refrigerator’s warranty, especially because Plaintiff was unable to view the
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disclaimer prior to purchasing the refrigerator. While the disclaimer of damages
was not hidden in a prolix of the printed form at issue, it was not provided to
Plaintiff at the time of purchase and therefore Plaintiff lacked any ability to
negotiate its terms or to make a different choice based on the disclaimer’s inclusion

6 in the express warranty. See Dorman, 46 Cal. App. 3d at 20 (holding a disclaimer
7 of consequential damages unenforceable when provided to the purchaser after the
8 sale). The court previously noted that Plaintiff had not pled procedural
9 unconscionability regarding LG’s disclaimer of the implied warranty because she
10 had not pled either that other choices were not available to her or that she could not
11 obtain additional warranty coverage from LG. Whereas the procedural
12 unconscionability of a disclaimer of implied warranties could be ameliorated by
13
LG’s offer of additional warranty coverage, it is unlikely additional warranty
14
coverage would remedy unnegotiated disclaimer of damages as the extended
15
warranty coverage presumably contains an identical provision.
16
In light of the relative bargaining power of the parties and the factual
17
18 scenario alleged in the SAC, the court finds Plaintiff has sufficiently alleged LG’s
19 disclaimer of damages in the express warranty was unconscionable and therefore
20 unenforceable. Accordingly, the court denies LG’s motion to dismiss the damages
21 requested by Plaintiff for her implied warranty claim under California Commercial
22 Code Section 2314.
23
24

3. Magnuson–Moss Warranty Act (“MMWA”) Claims
The Magnuson–Moss Warranty Act (“MMWA”) provides a federal cause of

25 action for state law express and implied warranty claims. 15 U.S.C. §§ 2301, et.
26
seq. Under the MMWA, a consumer may bring suit against a warrantor in any state
27
for failure to comply with its obligations under a written warranty or implied
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warranty. 15 U.S.C. § 2310(d)(1). Dismissal of the state law express and implied
warranty claims requires the same disposition with respect to an associated
MMWA claim. Clemens, 534 F.3d at 1022; In re Sony Grand Wega, KDF–E
A10/A20 Series Rear Projection HDTV Television Litig., 758 F. Supp. 2d 1077,

6 1101 (S.D. Cal. 2010). The court has dismissed Plaintiff’s breach of express
7 warranty claims without leave to amend at this juncture. However, because the
8 court concludes that Plaintiff has stated a claim for breach of implied warranty
9 under state law, the court denies LG's motion to dismiss Plaintiffs' MMWA cause
10 of action based upon breach of implied warranty.
11
MOTION TO STRIKE
12 I. Legal Standard
13
Rule 12(f) provides that the court “may strike from a pleading an insufficient
14
defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. R.
15
Civ. P. 12(f). However, striking the pleadings is considered “an extreme measure,”
16
and Rule 12(f) motions are therefore generally “viewed with disfavor and
17
18 infrequently granted.” Stanbury Law Firm v. IRS, 221 F.3d 1059, 1063 (8th Cir.
19 2000) (quoting Lunsford v. United States, 570 F.2d 221, 229 (8th Cir. 1977)).
20 II. Plaintiff’s Class Allegations
21

Class allegations are generally not tested at the pleadings stage and instead

22 are usually tested after one party has filed a motion for class certification. E.g.,
23 Thorpe v. Abbott Labs., Inc., 534 F. Supp. 2d 1120, 1125 (N.D. Cal. 2008); In re
24 Wal–Mart Stores, Inc. Wage & Hour Litig., 505 F. Supp. 2d 609, 615 (N.D. Cal.
25 2007). However, as the Supreme Court has explained, “[s]ometimes the issues are
26
plain enough from the pleadings to determine whether the interests of the absent
27
parties are fairly encompassed within the named plaintiff's claim.” Gen. Tel. Co. of
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Sw. v. Falcon, 457 U.S. 147, 160 (1982). Thus, a court may grant a motion to strike
class allegations if it is clear from the complaint that the class claims cannot be
maintained. E.g., Sanders v. Apple, Inc., 672 F. Supp. 2d 978, 990–91 (N.D. Cal.
2009).
LG argues that Plaintiff’s class allegations should be stricken because the

7 class is not ascertainable. LG contends the putative classes as alleged by Plaintiff
8 necessarily include members who have not experienced any problems with their
9 main board control panels or other parts of their refrigerators. Without an injury,
10 LG argues these putative class members have no standing to sue. LG also seeks to
11 strike or dismiss Plaintiff’s nationwide class allegations because resolution of
12 Plaintiff’s MMWA claims will necessarily require application of the law of all 50
13
states. LG contends this daunting task will preclude certification of a nationwide
14
class.
15
In response, Plaintiff contends LG’s attempt to strike or dismiss the class
16
claims at this stage is improper. While class allegations may be stricken at the
17
18 pleading stage, Plaintiff argues “[a]ny doubt concerning the import of the
19 allegations to be stricken weighs in favor of denying the motion to strike.” In re
20 Wal-Mart Stores, Inc. Wage and Hour Litigation, 505 F. Supp. 2d 609, 614 (N.D.
21 Cal. 2007). Plaintiff relies upon several cases in which the court determined class
22 allegations were more properly considered in the context of class certification. Id.
23 (denying motion to dismiss or strike class allegations at the pleading stage and
24 reserving issue for class certification motion); accord Whitson v. Bumbo, 2008 WL
25 2080855, at *1 (N.D. Cal. May 8, 2008); Shabaz v. Polo Ralph Lauren Corp., 586 F.
26
Supp. 2d 1205, 1209 (C.D. Cal. 2008).
27
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In this instance, the court agrees with Plaintiff. LG's motion regarding
Plaintiff’s class allegations is premature, and the court is not prepared to find, based
on the pleadings alone, that Plaintiff cannot possibly state valid class claims.
Motions to strike or dismiss class allegations at this stage are generally disfavored

6 because a motion for class certification is the more appropriate vehicle for the type
7 of arguments made by LG here. Accordingly, the court denies without prejudice
8 LG’s motion to dismiss or, alternatively, to strike Plaintiff's class certification
9 allegations.
10
11

CONCLUSION
Based on the foregoing, defendant LG’s motion to dismiss is GRANTED IN

12 PART and DENIED IN PART, and Defendant LG’s motion to strike is DENIED.
13
Accordingly, the court dismisses Plaintiff’s UCL, FAL, and breach of warranty
14
claims made on behalf of the general public with prejudice and without leave to
15
amend. Additionally, the court dismisses Plaintiff’s breach of express warranty
16
claims and MMWA claim based upon breach of express warranty without leave to
17
18 amend at this time. Defendant LG is ordered to file its answer within 20 days of the
19 filing of this order.
IT IS SO ORDERED.
20
21 DATED: October 29, 2013
22
23
24
25

Hon. Jeffrey T. Miller
United States District Judge

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