Lee v. Forest River, Inc. et al

Filing 16

ORDER AND REASONS granting 10 Motion to Dismiss for Failure to State a Claim. Plaintiff's claims for redhibition, lender liability, and violations of the Magnuson-Moss Warranty Act are DISMISSED WITHOUT PREJUDICE. Plaintiff has 21 days to ame nd his complaint. Plaintiff's Magnuson-Moss Warranty Act claim against Defendant Forest River, Inc. is DISMISSED WITH PREJUDICE insofar as this claim relates to an express warranty as to the defects identified in the original complaint. Signed by Judge Sarah S. Vance on 9/14/2017. (cg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
DAVID E. LEE

CIVIL ACTION

VERSUS

NO. 17-2103

FOREST RIVER, INC., ET AL.

SECTION “R” (4)

ORDER AND REASONS
Defendants Forest River, Inc., Dixie Motors, Inc., and Bank of
America, National Association, move to dismiss plaintiff’s complaint under
Federal Rule of Civil Procedure 12(b)(6).1 For the following reasons, the
Court grants the motion.

I.

BACKGROUND
This case arises out of the sale of an allegedly defective recreational

vehicle (RV).2

On September 14, 2013, plaintiff bought a new 2014

Coachman Leprechaun from Defendant Dixie Motors, LLC. 3 The purchase
was financed by Defendant Bank of America, National Association.4
Defendants Forest River, Inc. and General Motors, LLC each allegedly

1
2
3
4

R. Doc. 10.
R. Doc. 1.
Id. at 3 ¶ 9.
Id. at 7 ¶ 33.

manufactured components of the vehicle.5

Plaintiff asserts that the

Coachman Leprechaun was defective in materials and workmanship at the
time of delivery, and that these defects were discovered within the warranty
periods.6 Specifically, plaintiff alleges that the RV has experienced problems
with the engine not starting and dying out, water leaks from the air
conditioner, electrical defects, and engine defects. 7

According to the

complaint, plaintiff returned the vehicle to defendants for warranty repairs
on multiple occasions, but the defects have not been remedied. 8
On March 14, 2017, plaintiff filed a complaint against defendants
alleging negligent repair, lender liability and violations of both the
Magnuson-Moss Warranty Act and Louisiana redhibition laws. 9 Plaintiff
seeks damages, rescission of the sales contract, and attorneys’ fees and
costs. 10 Defendants Forest River, Dixie Motors, and Bank of America now
move to dismiss plaintiff’s complaint for failure to state a claim upon which
relief can be granted. 11

Defendant General Motors has not joined this

motion.

5
6
7
8
9
10
11

Id. at 5 ¶ 23; R. Doc. 15 at 7-8.
R. Doc. 1 at 4 ¶ 17.
Id. at 5 ¶ 17.
Id. at 5 ¶ 18.
Id. at 5-9.
Id. at 9-11.
R. Doc. 10.
2

II.

LEGAL STANDARD
To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must plead

“sufficient factual matter, accepted as true, to ‘state a claim to relief that is
plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially
plausible when the plaintiff pleads facts that allow the court to “draw the
reasonable inference that the defendant is liable for the misconduct alleged.”
Id. at 678. A court must accept all well-pleaded facts as true and must draw
all reasonable inferences in favor of the plaintiff. See Lormand v. US
Unwired, Inc., 565 F.3d 228, 232 (5th Cir. 2009).
A legally sufficient complaint must establish more than a “sheer
possibility” that the plaintiff’s claim is true. Iqbal, 556 U.S. at 678. It need
not contain detailed factual allegations, but it must go beyond labels, legal
conclusions, or formulaic recitations of the elements of a cause of action. Id.
In other words, the face of the complaint must contain enough factual matter
to raise a reasonable expectation that discovery will reveal relevant evidence
of each element of the plaintiff’s claim. Lormand, 565 F.3d at 257. The claim
must be dismissed if there are insufficient factual allegations to raise a right
to relief above the speculative level, Twombly, 550 U.S. at 555, or if it is

3

apparent from the face of the complaint that there is an insuperable bar to
relief, Jones v. Bock, 549 U.S. 199, 215 (2007).

III. DISCUSSION
Defendants move to dismiss the complaint on the grounds that the
alleged defects are not subject to warranty, the Magnuson-Moss Warranty
Act claims and redhibition claims are prescribed on the face of the complaint,
and Bank of America is not liable as a matter of law. 12 The Court considers
each issue in turn.
A.

Warranty Coverage

The Magnuson-Moss Warranty Act “creates a statutory cause of action
for consumers damaged by the failure of a supplier, warrantor, or service
contractor to comply with any obligation imposed by the Act or established
by a written warranty, implied warranty, or service contract.” Walton v. Rose
Mobile Homes, LLC, 298 F.3d 470, 474 (5th Cir. 2002) (citation and
quotation marks omitted). “The Act does not require that a seller give a
warranty on a consumer product, but if a warranty is given, it must comply
with the terms of the Act.” Boelens v. Redman Homes, Inc., 748 F.2d 1058,
1061 (5th Cir. 1984). Plaintiff alleges that defendants Forest River and

12

R. Doc. 10-1 at 1.
4

General Motors are “suppliers” and “warrantors” under the Magnuson-Moss
Warranty Act, and that the express warranties pertaining to the vehicle are a
“written warranty” under the Act.13
Defendants argue that the defects alleged in the complaint do not give
rise to a claim under the Magnuson-Moss Warranty Act because the defects
are not covered by a warranty. 14 In support of their motion, defendants
attach Forest River’s limited warranty for recreational vehicles.15 The Court
may consider a document attached to a motion to dismiss if it is referenced
in plaintiff’s complaint and central to his claim. See In re Katrina Canal
Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007); Collins v. Morgan Stanley
Dean Witter, 224 F.3d 496, 498-99 (5th Cir. 2000). Plaintiff’s complaint
alleges an express warranty by Forest River, and this warranty is central to
plaintiff’s Magnuson-Moss claim against Forest River. 16 Moreover, plaintiff
has expressed no objection to the introduction of the warranty. See Scanlan
v. Tex. A & M Univ., 343 F.3d 533, 536 (5th Cir. 2003). The Court may
therefore consider the terms of the limited warranty.

13
14
15
16

R. Doc. 1 at 7.
R. Doc. 10-1 at 6.
R. Doc. 10-2 at 2.
R. Doc. 1 at 4 ¶ 15-16.
5

The Forest River limited warranty provides coverage for a period of one
year from the date of purchase or 12,000 miles, whichever occurs first.17
Plaintiff purchased the RV on September 14, 2013.18 The limited warranty
covers “the body structure of th[e] recreational vehicle” and expressly
disclaims any warranty for “the motorhome chassis including without
limitation, the engine and drivetrain, any mechanical parts or systems of the
chassis, tires, tubes, batteries and gauges, optional generators, routine
maintenance,

equipment

and

appliances,

or

audio

and/or

video

equipment.” 19
Plaintiff does not contest the authenticity of this limited warranty, nor
does he argue that the warranty is otherwise invalid. As required by the
Magnuson-Moss Warranty Act, the one-page warranty is conspicuously
designated as a “limited warranty,” and its terms are “fully and conspicuously
disclose[d] in simple and readily understood language.” See 15 U.S.C. §§
2302-03. The warranty also clearly limits the duration of any implied
warranties to the one year or 12,000 mile express warranty period. See 15
U.S.C. § 2308(b). The defects complained of by plaintiff include electrical

17
18
19

R. Doc. 10-2 at 2.
R. Doc. 1 at 3 ¶ 9.
R. Doc. 10-2 at 2.
6

defects, engine defects, and problems with the air conditioning. 20 These
alleged defects do not relate to the body structure of the RV and are expressly
excluded by the terms of the limited warranty. Accordingly, plaintiff has not
stated a claim against Forest River under the Magnuson-Moss Warranty Act.
The complaint also asserts that General Motors provided additional
warranties on the RV.21 General Motors has not joined this motion to
dismiss, and any alleged General Motors warranty is not before the Court.
The Court therefore makes no finding at this time as to whether the
complained of defects are covered by a General Motors warranty.
B.

Statute of Limitations

The Magnuson-Moss Warranty Act does not supply a statute of
limitations, and federal courts apply the limitations period of the analogous
state law claim. See Hardin v. Forest River, No. 17-2132, 2017 WL 3311260,
at *2 (E.D. La. 2017); Naquin v. Berryland Campers, No. 14-2133, 2014 WL
6981944, at *3 (E.D. La. 2014). In Louisiana, the analogous claim is an
action for redhibition. Hardin, 2017 WL 3311260, at *2; Naquin, 2014 WL
6981944, at *3; see also Ford Motor Credit Co. v. Bower, 589 So. 2d 571, 573
(La. App. 1 Cir. 1991) (explaining that breach of warranty actions in Louisiana

20
21

Id. at 5 ¶ 17.
Id at 4 ¶ 16.
7

are brought in redhibition). The same limitations period therefore applies to
plaintiff’s Magnuson-Moss Warranty Act and redhibition claims.
Under Louisiana law, the prescriptive period for redhibition claims
against a seller who did not know of the existence of a defect runs four years
from the date of delivery. La. Civ. Code art. 2534(A)(1). Regardless of
whether the seller knew of the existence of the defect, a redhibition claim
prescribes no later than one year from the day the defect was discovered by
the buyer. La. Civ. Code art. 2534. But “prescription is interrupted when the
seller accepts the thing for repairs and commences anew from the day he
tenders it back to the buyer or notifies the buyer of his refusal or inability to
make the required repairs.” La. Civ. Code art. 2534(C).
In Louisiana, “[t]he burden of proof is normally on the party pleading
prescription; however, if on the face of the petition it appears that
prescription has run . . . the burden shifts to the plaintiff to prove a
suspension or interruption of the prescriptive period.” Younger v. Marshall
Indus., Inc., 618 So. 2d 866, 869 (La. 1993); see also Bourque v. Olin Corp.,
253 F.3d 701 (5th Cir. 2001); Eastin v. Entergy Corp., 865 So. 2d 49, 54 (La.
2004). Plaintiff purchased the RV on September 14, 2013. 22 He filed his

22

R. Doc. 1 at 3.
8

complaint on March 14, 2017. 23 Defendants assert that plaintiff’s claims are
facially prescribed.24 The Court finds that it is apparent from the allegations
in the complaint that plaintiff discovered the alleged defects over one year
before filing suit. Plaintiff does not contest that he was aware of the defects
more than one year before he filed his complaint. 25 Instead, plaintiff asserts
that the limitations period was interrupted by repair attempts.26
Because plaintiff bears the burden of establishing an interruption of
the prescriptive period, Younger, 618 So. 2d at 869, the complaint must
include sufficient allegations regarding the timing of repairs to “raise a right
to relief above the speculative level.” Twombly, 550 U.S. at 555; see also
Heilman v. City of Beaumont, 638 F. App’x 363, 366-67 (5th Cir. 2016)
(explaining that plaintiff must plead facts sufficient to allege that relevant
injuries occurred within the limitations period); Jones v. Alcoa, Inc., 339

R. Doc. 1.
R. Doc. 10-1 at 5. Defendants emphasize the portion of the complaint
that states that “[f]rom the date of its purchase, the LEPRECHAUN
continues to this day to exhibit some or all of the non-conformities
described herein.” R. Doc. 1 at 5 ¶ 18. Read in the light most favorable to
the plaintiff, this allegation is not a clear admission that plaintiff knew of all
the alleged defects on the date of purchase. But plaintiff’s other allegations
make clear that he discovered the alleged defects before March 14, 2016.
25
On the contrary, plaintiff’s memorandum in opposition represents
that the RV was taken in for service for an engine issue on February 2,
2015, over two years before the date of the complaint. See R. Doc. 15 at 8.
26
R. Doc. 15.
9
23

24

F.3d 359, 366 (5th Cir. 2003) (affirming Rule 12(b)(6) dismissal where
plaintiffs’ complaint failed to sufficiently allege a basis for tolling the statute
of limitations).
The complaint fails to specify when repairs occurred or which
particular defects were subject to repair attempts. See Mouton v. Generac
Power Sys., Inc., 152 So. 2d 985, 992-93 (La. App. 3 Cir. 2014) (explaining
that repairs of unrelated defects do not interrupt the prescriptive period).
Accordingly, plaintiff has not pleaded sufficient facts to indicate that the
prescriptive period was interrupted by repairs. Nor has plaintiff adequately
alleged that he filed suit within one year of the termination of repair
attempts. See La. Civ. Code art. 2534(C). The Court therefore finds plaintiff’s
redhibition and Magnuson-Moss Warranty Act claims prescribed.
C.

Lender Liability

Plaintiff also asserts a lender liability claim against Bank of America
under the Federal Trade Commission’s Holder Rule.27

As plaintiff

acknowledges, the Holder Rule does not provide a separate cause of action
and is derivative of plaintiff’s claims against the other defendants.28 See
Yumilicious Franchise, LLC v. Barrie, 819 F.3d 170, 176 (5th Cir. 2016);

27
28

R. Doc. 1 at ¶ 7; R. Doc. 15 at 15.
R. Doc. 15 at 18.
10

MidFirst Bank v. Craige, No. 16-3941, 2017 WL 2311740, at *5 (E.D. La.
2017). Because the Court has dismissed plaintiff’s redhibition and
Magnuson-Moss Warranty Act claims, plaintiff cannot maintain a lender
liability claim against Bank of America.
D.

Leave to Amend

Plaintiff has requested leave to amend his complaint if defendant’s
motion is granted. 29 Plaintiff has not previously amended his complaint.
The Court will “freely give leave [to amend] when justice so requires.” Fed.
R. Civ. P. 15(a). The Supreme Court has held that “[i]f the underlying facts
or circumstances relied upon by a plaintiff may be a proper subject of relief,
he ought to be afforded an opportunity to test his claim on the merits.”
Foman v. Davis, 371 U.S. 178, 182 (1962). Leave to amend, however, “is by
no means automatic.” Halbert v. City of Sherman, 33 F.3d 526, 529 (5th Cir.
1994). The Court considers multiple factors, including “undue delay, bad
faith or dilatory motive on the part of the movant, repeated failure to cure
deficiencies by amendments previously allowed, undue prejudice to the
opposing party by virtue of allowance of the amendment, [and] futility of
amendment.” Foman, 371 U.S. at 182.

29

Id. at 22.
11

After consideration of these factors, the Court denies plaintiff leave to
amend his Magnuson-Moss Warranty Act claim against Forest River insofar
as this claim relates to an express warranty as to the defects identified in the
complaint. Because these alleged defects are not covered by Forest River’s
limited warranty, amendment would be futile. The Court grants plaintiff
leave to amend his complaint in other respects.

IV.

CONCLUSION
For the foregoing reasons, the Court GRANTS defendants’ motion.

Plaintiff’s claims for redhibition, lender liability, and violations of the
Magnuson-Moss Warranty Act are DISMISSED WITHOUT PREJUDICE.
Plaintiff has 21 days to amend his complaint. Plaintiff’s Magnuson-Moss
Warranty Act claim against Defendant Forest River, Inc. is DISMISSED
WITH PREJUDICE insofar as this claim relates to an express warranty as to
the defects identified in the original complaint.

14th
New Orleans, Louisiana, this _____ day of September, 2017.

_____________________
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE
12