Flint v. Hewlett-Packard Company
Filing
68
MEMORANDUM AND OPINION by Judge Charles R. Simpson, III on 8/26/11. For reasons stated on the record Complaint must be dismissed without prejudice for want of subject matter jurisdiction. A separate order will be entered this date in accordance with this opinion.cc:counsel (SJS)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
AT LOUISVILLE
EDWARD H. FLINT
PLAINTIFF
v.
CIVIL ACTION NO. 3:10-CV-597-S
HEWLETT-PACKARD COMPANY
DEFENDANT
MEMORANDUM OPINION
This matter is before the court for consideration whether the court has subject matter
jurisdiction under 28 U.S.C. §1332(a) over this lawsuit. The Magistrate Judge first raised a question
as to the jurisdictional amount in controversy in a hearing held on May 4, 2011. He then stayed the
proceedings, and set a briefing schedule to afford the parties the opportunity to ascertain whether
the $75,000 jurisdictional threshold had been met. (DN 48, 57). The parties have now filed their
post-hearing briefs and the matter is ripe for decision. (DN 63, 64, 65).
Plaintiff Edward H. Flint filed a pro se complaint against defendant Hewlett-Packard
Company (“HP”) concerning his purchase of an allegedly defective printer. Flint’s complaint asserts
claims for breach of warranty, fraud, and monopolistic business practices. He demands injunctive
relief, an award of compensatory and punitive damages, and a $50 million “fine” should HP be
“found guilty by a jury of committing fraud on public consumers ....” (DN 1, Complaint p. 7, ¶ 4).
Flint has moved for leave to file an amended complaint to add Home Depot as a party defendant.
Because we conclude that the matter in controversy cannot exceed the sum of $75,000 as a matter
of law, the Court must dismiss the complaint without prejudice.
The jurisdiction of federal courts is limited. By statute, this court may entertain civil actions
that arise under the U.S. Constitution, laws or treaties of the United States (28 U.S.C. § 1331), and
civil actions between citizens of different states where the matter in controversy exceeds the sum
or value of $75,000, exclusive of interest and costs. (28 U.S.C. §1332(a)(1)).
The district court is charged with the duty of assessing its jurisdiction and must sua sponte
dismiss cases in which subject matter jurisdiction is lacking. See, Nagalingam v. Wilson, Sowards,
Bowling & Costanzo, 8 Fed.Appx. 486, 2001 WL 493392 (6th Cir. May 1, 2001); Franchise Tax
Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983);
Anusbigian v. Trugreen/Chemlawn, Inc. 72 F.3d 1253, 1254 (6th Cir. 1996). The Court liberally
construes pro se pleadings in determining whether claims have been adequately pled. See, Hahn
v. Star Bank, 190 F.3d 708, 715-16 (6th Cir. 1999), cert. denied, 529 U.S. 1020 (2000), citing Haines
v. Kerner, 404 U.S. 519, 520-21 (1972).
Flint’s complaint does not state a claim that implicates the court’s federal question
jurisdiction.
The only possible basis for subject matter jurisdiction over this action is diversity of
citizenship under 28 U.S.C. §1332(a). Flint and HP are citizens of different states. Flint resides in
Louisville, Kentucky. According to the complaint, HP “is located” in Palo Alto, California.
However, the amount in controversy must exceed the sum or value of $75,000 for this Court to
exercise jurisdiction.
Flint must establish that the court has jurisdiction. “The party invoking federal court
jurisdiction...has the burden of demonstrating by competent proof that the complete-diversity and
amount-in-controversy requirements are met. Hertz Corp. v. Friend, --- U.S. ----, 130 S.Ct. 1181,
1194-95, --- L.Ed.2d ---- (2010).” Cleveland Housing Renewal Project v. Deutsche Bank Trust Co.,
621 F.3d 554, 559 (6th Cir. 2010).
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In Kovacs v. Chesley, 406 F.3d 393, 395-97 (6th Cir. 2005), the United States Court of
Appeals for the Sixth Circuit stated that:
The rule governing dismissal for want of jurisdiction in cases brought
in federal court is that unless the law gives a different rule, the sum
claimed by the plaintiff controls if the claim is apparently made in
good faith. It must appear to a legal certainty that the claim is really
for less than the jurisdictional amount to justify dismissal...[I]f from
the face of the pleadings, it is apparent, to a legal certainty, that the
plaintiff cannot recover the amount claimed or if, from the proofs, the
court is satisfied to a like certainty that the plaintiff never was
entitled to recover that amount ... the suit will be dismissed.
Kovacs, 406 F.3d at 395-96, quoting St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283
(1938).
Thus the courts will accept the amount claimed on the face of the complaint unless it appears
to a legal certainty that the plaintiff cannot recover that amount, or the court is satisfied from the
undisputed evidence of record to a legal certainty that the plaintiff was never entitled to recover that
amount in the first instance. St. Paul Mercury Indemnity Co., 303 U.S. at 289. See also, 14 B.
Charles Allen Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure,
§3702 at p. 98-99 n. 88 (Third Ed. 1998 & Supp. 2008) (legal certainty test met “when a specific
rule of substantive law or measure of damages limits the amount of money recoverable by the
plaintiff.”). “A claim is less than the jurisdictional amount where the ‘applicable state law bar[s]
the type of damages sought by the plaintiff.’” Rosen v. Chrysler Corp., 205 F.3d 918, 921 (6th Cir.
2000) (internal citations omitted). Because this is a diversity action, the law of the forum state,
Kentucky, applies. Montgomery v. Wyeth, 580 F.3d 455, 459 (6th Cir. 2009).
Even when Flint’s claims are liberally construed, it is apparent that, under Kentucky law,
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Flint cannot recover $75,000 in damages.
Flint claims that the Office Jet Model J4580 all-in-one printer that he purchased from Home
Depot for $84.79 in July of 2009 was defective. Apparently he obtained a replacement J4580
printer from HP on April 28, 2010 that also eventually malfunctioned. He alleges that on Sept. 9,
2010, the words “tri-color ink cartridges incomparable [sic]” continuously scrolled across the screen
of the printer. Complaint (“Compl.”), ¶¶ 19, 22. Flint claims that he made repeated efforts to solve
the problem with technical assistance representatives from HP. He maintains that the technicians
“in India” spoke “only broken English,” and were unable to assist him even though he claims he
spent hours on the telephone attempting to resolve the error message. Comp., ¶¶ 19, 22. Ultimately,
a technician referred Flint to a “supervisor” who allegedly advised Flint that HP would contact him
and that a new printer would be shipped to him. Compl. ¶ 22.
When the anticipated phone call did not come, Flint resumed his calls to HP to obtain
information concerning a second replacement printer.
Allegedly, after making a series of
unsuccessful calls, on September 13, 2010, Flint spoke with an HP “case manager.” Compl., ¶ 24.
According to Flint, after he related the sequence of events, he was advised that the Officejet Model
J4580 all-in-one printer had been discontinued, and that he could purchase a newer-model printer
for $119.00. Compl., ¶ 24. Flint claims that the “case manager” told him that the supervisor
purportedly promising a free replacement printer of any model lacked the authority to make such
a promise. ¶ 24.
Flint maintains that as a result of these events he has suffered physical and mental harm. He
further contends that HP has misled its customers by its failure to reveal that the J4580 printer had
“problems,” and that only HP-brand ink cartridges would operate properly in this printer. Compl.,
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¶¶ 25, 28, 29, 31.
Flint claims that the J4580 printer came with a warranty in which HP “implied that if the
printer didn’t work, HP as promised would correct any faults, so it would perform as promised.”
Compl. ¶ 3. HP has provided a copy of the warranty which contains the following limiting
language:
A. Extent of limited warranty
...
5.
If HP receives, during the applicable warrant period,
notice of a defect in any product which is covered by
HP’s warranty, HP shall either repair or replace the
product, at HP’s option.
6.
If HP is unable to repair or replace, as applicable, a
defective product which is covered by HP’s warranty,
HP shall within a reasonable time after being notified
of the defect, refund the purchase price for the
product.
7.
HP shall have no obligation to repair, replace, or
refund until the customer returns the defective
product to HP.
8.
Any replacement product may be either new or likenew, provided that it has functionality at least equal to
that of the product being replaced.
9.
HP products may contain remanufactured parts,
components, or materials equivalent to new in
performance.
10.
HP’s Limited Warranty Statement is valid in any
country where the covered HP product is distributed
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by HP. Contracts for additional warranty services
such as on-site service, may be available from any
authorized HP service facility in countries where the
product is distributed by HP or by an authorized
importer.
B.
Limitations of warranty
TO THE EXTENT ALLOWED BY LOCAL LAW,
NEITHER HP NOR ITS THIRD PARTY
SUPPLIERS MAKE ANY OTHER WARRANTY
OR CONDITION OF ANY KIND, WHETHER
EXPRESS OR IMPLIED WARRANTIES OR
CONDITIONS OF MERCHANTABILITY,
SATISFACTORY QUALITY, AND FITNESS FOR
A PARTICULAR PURPOSE.
C.
Limitations of liability
1.
To the extent allowed by local law, the remedies
provided in this Warranty Statement are the
customer’s sole and exclusive remedies.
2.
TO THE EXTENT ALLOWED BY LOCAL LAW,
EXCEPT FOR THE OBLIGATIONS
SPECIFICALLY SET FORTH IN THIS
WARRANTY STATEMENT, IN NO EVENT
SHALL HP OR ITS THIRD PARTY SUPPLIERS
BE LIABLE FOR DIRECT, INDIRECT, SPECIAL,
INCIDENTAL, OR CONSEQUENTIAL
DAMAGES, WHETHER BASED ON CONTRACT,
TORT, OR ANY OTHER LEGAL THEORY AND
WHETHER ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES.
DN 38, Ex. A, Hewlett-Packard Limited Warranty Statement (emphasis in original).
The Kentucky Uniform Commercial Code, Kentucky Revised Statutes (“KRS”) Chapter 355,
sets out remedies available to buyers of non-conforming goods. KRS 355.2-711(1).
Kentucky law provides that “under the Uniform Commercial Code [which governs the sale
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of goods], particularly KRS 355.2-316 and 355.2-719, the parties can by contract exclude implied
warranties and can limit remedies for breach of warranty.” Cox Motor Car Co. v. Castle, 402
S.W.2d 429, 431 (Ky. 1966). See also, Moore v. Mack Trucks, Inc., 40 S.W.3d 888, 892-93 (Ky.
App. 2001) (Under the Uniform Commercial Code, a seller may limit the remedies available to a
buyer for breach of warranty pursuant to KRS 355.2-719)(citing Ford Motor Co. v. Mayes, 575
S.W.2d 480, 483 (Ky. App. 1978)).
KRS 355.2-719(1)(a), provides that an agreement may limit a buyer’s remedy to “repair and
replacement of nonconforming goods or parts.” Such a limitation is permitted by Kentucky law.
Mayes, 575 S.W.2d at 483. KRS 355.2-719(3) further provides that “consequential damages may
be limited or excluded unless the limitation or exclusion is unconscionable.”
See, Rudd
Construction and Equip. Co., Inc. v. Clark Equip. Co., 735 F.2d 974, 979 (6th Cir. 1984) (“Under
this section parties are left free to shape their remedies to their particular requirements and
reasonable agreements limiting or modifying remedies are to be given effect.”) (quoting Kentucky
Commentary to KRS § 355.2-719).
HP has disclaimed in conspicuous language liability for damages in contract, tort or other
any other legal theory arising from the sale of its printer. The sole remedy available to Flint under
the provisions of the Limited Warranty Statement, as permitted by KRS 355.2-719(1)(A), is the
repair or replacement of the allegedly defective product. Flint does not dispute that he returned the
original, defective printer to HP and received a replacement. Apparently, he was also offered the
option to obtain another HP printer of comparable value when the replacement printer failed and that
model was discontinued.
Accordingly, the Court finds that HP’s Limited Warranty Statement precludes Flint from
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recovering damages for his alleged injuries under any of the various causes of action related to his
purchase of the allegedly defective HP printer. Because of this limited warranty, Flint cannot state
a viable damage claim exceeding $75,000.
Flint includes a claim for alleged “monopoly” of the printer ink cartridge market. This claim
is based solely on the fact that the HP J4580 printer allegedly operated properly only with HP-brand
ink cartridges. For purposes of this analysis, the court construes this pro se allegation as an attempt
to articulate an antitrust claim under § 2 of the Sherman Act, 15 U.S.C. § 2. The Sherman Act
provides that it is unlawful to “monopolize, or attempt to monopolize, or combine or conspire with
any other person or persons, to monopolize any part of the trade or commerce among the several
states....” 15 U.S.C. § 2.
To state an antitrust claim, a plaintiff must do more than merely raise a “naked assertion” of
antitrust activity. NicSand, Inc. V. 3M Co, 507 F.3d 442, 449-51 (6th Cir. 2007). As the United
States Supreme Court explained in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555(2007), “a
plaintiff’s obligation to provide the grounds of his entitlement to relief requires more than labels and
conclusions and a formulaic recitation of the elements of a cause of action will not do....” Id.
Flint’s complaint does not contain even a “formulaic recitation” of antitrust elements. Bell
Atlantic, supra. See American Council of Certified Podiatric Physicians and Surgeons v. American
Bd of Podiatric Surgery, Inc., 323 F.3d 366, 370 (6th Cir. 2003)(quoting Eastman Kodak Co. V.
Image Technical Servs., Inc, 504 U.S. 451, 481(1992)). Flint’s complaint fails to state the most
fundamental components of an unlawful monopoly under § 2 of the Sherman Act. Further, were
such a claim sufficiently articulated, no antitrust injury has been alleged which would satisfy the
jurisdictional threshold of $75,000 in controversy.
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Flint alleges that HP “rushed the printer into production” because “they wanted the sales
from ink cartridges,” but HP “knew the printer was not ready to be sold and they knew the printer
had a lot of flaws in it when they released the printer for sale.” Compl., ¶ 4. Flint contends that
“They intentionally made the printer so that it could not use ink from another manufacture [sic] or
a refill of their own cartridges, which forced a consumer to buy their ink cartridges and thereby
create a monopoly on the ink cartridges for Hewlett-Packard printers. They created this monopoly
[sic] didn’t tell or warn the customers before or [sic] doing the sales that the printer would only use
HP ink cartridges.” Compl., ¶ 5.
Flint’s only articulated injury is that his printer malfunctioned and he could not obtain
assistance in fixing it nor otherwise achieve a satisfactory resolution with HP. Nowhere in the
complaint is there an allegation concerning any purchase or use of HP-brand ink cartridges by Flint.
Further, Flint’s available remedy - refund or replacement of the printer - would have negated any
perceived necessity to purchase HP-brand cartridges.
Finally, Flint asserts that the jurisdictional prerequisite has been met since he demanded a
fifty-million dollar fine if HP is “‘found guilty’ of committing fraud on public consumers.” (DN 1,
p. 7, ¶ 4). These allegations confuse a civil lawsuit with a criminal prosecution which may not be
brought by Flint, a private citizen. Flint has no standing to recover a “fine” for alleged criminal
conduct. Therefore, the Court may not consider this demand in assessing the amount in controversy
under §1332(a). See, Holzsager v. Warburton, 452 F. Supp. 1267, 1274 (D. N.J. 1978) (allegation
of amount without foundation will not serve to provide jurisdiction)(citing Gray v. Occidental Life
Ins. Co. of Cal., 387 F.2d 935, 936 (3rd Cir. 1968); Ehrenfeld v. Webber, 499 F. Supp. 1283, 1291
(D. Md. 1980).
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Based upon the foregoing analysis, the court finds, to a legal certainty, that Flint cannot
satisfy the $75,000 amount in controversy requirement to establish diversity jurisdiction under 28
U.S.C. §1332. Accordingly, his complaint must be dismissed without prejudice for want of subject
matter jurisdiction. A separate order will be entered this date in accordance with this opinion.
IT IS SO ORDERED.
August 26, 2011
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