Jaguar Land Rover Limited v. Bombardier Recreational Products, Inc.
OPINION AND ORDER GRANTING DEFENDANT'S MOTION TO DISMISS PLAINTIFF'S COUNT IV 10 AND DENYING PLAINTIFF'S FIRST MOTION TO DISMISS DEFENDANTS COUNTERCLAIM COUNTS II AND IV 13 AS MOOT. Signed by District Judge Gershwin A. Drain. (TBan)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
JAGUAR LAND ROVER LIMITED,
Case No. 16-cv-13386
UNITED STATES DISTRICT COURT JUDGE
GERSHWIN A. DRAIN
UNITED STATES MAGISTRATE JUDGE
STEPHANIE DAWKINS DAVIS
OPINION AND ORDER GRANTING DEFENDANT’S MOTION TO DISMISS
PLAINTIFF’S COUNT IV  AND DENYING PLAINTIFF’S FIRST MOTION TO
DISMISS DEFENDANT’S COUNTERCLAIM COUNTS II AND IV  AS MOOT
On September 19, 2016, Jaguar Land Rover Limited (“Plaintiff” or “JLR”)
filed a seven-count Complaint alleging trademark claims under the Lanham Act
and other state and common law allegations against Bombardier Recreational
Products Inc. (“Defendant” or “BRP”). Dkt. No. 1. The dispute centers on the sale
of vehicles that both bear the mark “Defender.” Id.
The matter is presently before the Court on Defendant’s Motion To Dismiss
Plaintiff’s Count IV (Violation Of The Michigan Consumer Protection Act
(MCPA)) , pursuant to Federal Rule of Civil Procedure 12(b)(6). The motion
was filed on November 23, 2016 and is fully briefed. Id. Upon review of the
pleadings, the Court finds that oral argument will not aid in the disposition of this
matter. Accordingly, the Court will decide the matter on the submitted briefs. See
E.D. Mich. L.R. 7.1(f)(2). For the reasons discussed herein, the Court GRANTS
Defendant’s Motion to Dismiss  and DISMISSES Plaintiff’s Count IV without
Plaintiff filed a Motion to Dismiss Counts II and IV of Defendant’s
Counterclaims  on December 19, 2016. Defendant amended its Counterclaims
on January 9, 2017, Dkt. No. 18, and Plaintiff filed a second Motion to Dismiss
Defendant’s Counterclaim Count IV, Dkt. No. 24, but failed to properly withdraw
its now mooted first motion. Accordingly, the Court will DENY Plaintiff’s first
Motion to Dismiss  as moot, without prejudice as to Defendant’s amended
counterclaims. Plaintiff’s second Motion to Dismiss  is scheduled for a hearing
in April 2017 and will be considered at a later time.
II. LEGAL STANDARD
Federal Rule of Civil Procedure 12(b)(6) authorizes dismissal of a complaint
for “failure to state a claim upon which relief can be granted.” To withstand a
motion to dismiss pursuant to Rule 12(b)(6), a complaint must comply with the
pleading requirements of Federal Rule of Civil Procedure 8(a). See Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). Rule 8(a)(2) requires “a short and plain statement
of the claim showing that the pleader is entitled to relief, in order to give the
defendant fair notice of what the . . . claim is and the grounds upon which it rests.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quotation marks omitted)
(quoting FED. R. CIV. P. 8(a)(2); Conley v. Gibson, 355 U.S. 41, 47 (1957)). To
meet this standard, a complaint must contain sufficient factual matter, accepted as
true, to “state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at
570; see also Iqbal, 556 U.S. at 678–80 (2009) (applying the plausibility standard
articulated in Twombly).
When considering a Rule 12(b)(6) motion to dismiss, the Court must
construe the complaint in a light most favorable to the plaintiff and accept all of his
or her factual allegations as true. Lambert v. Hartman, 517 F.3d 433, 439 (6th Cir.
2008). However, the Court need not accept mere conclusory statements or legal
conclusions couched as factual allegations. See Iqbal, 556 U.S. at 678.
In Count IV, JLR alleges that BRP’s sale of vehicles under the “Defender”
mark has and is “causing confusion or misunderstanding as to the source,
sponsorship, approval and/or certification of goods or services within the meaning
of the MCPA,” causing irreparable harm to JLR. Dkt. No. 1, p. 12 (Pg. ID 12).
BRP moves to dismiss Count IV by arguing that the transactions or conduct at
issue in this case is exempt under the MCPA. Dkt. No. 10, p. 2 (Pg. ID 57).
The Court Declines to Exercise Supplemental Jurisdiction on
JLR’s MCPA Claim
Under the MCPA, “[u]nfair, unconscionable, or deceptive methods, acts, or
practices in the conduct of trade or commerce are unlawful,” including “[c]ausing a
probability of confusion or misunderstanding as to the source, sponsorship,
approval, or certification of goods or services.” MICH. COMP. LAWS
§ 445.903(1)(a). The MCPA, however, exempts any “transaction or conduct
specifically authorized under laws administered by a regulatory board or officer
acting under statutory authority of this state or the United States.” MICH. COMP.
LAWS § 445.904(1)(a); Liss v. Lewiston–Richards, Inc., 478 Mich. 203, 205–06,
732 N.W.2d 514 (2007). The Michigan Supreme Court has instructed that the
relevant inquiry “is whether the general transaction is specifically authorized by
law, regardless of whether the specific misconduct alleged is prohibited.” Liss, 478
Mich. at 210, 732 N.W.2d at 518. “The party claiming the exemption bears the
burden of proving its applicability.” Id. at 208, 732 N.W.2d at 517.
The general transaction alleged by JLR is the sale of BRP’s products. Dkt.
No. 1, p. 12 (Pg. ID No. 12). Thus, the question is whether this general
transaction—the sale of off-road vehicles by BRP—is specifically authorized by
law. BRP argues that Michigan’s Natural Resources and Environmental Protection
Act (NREPA) provides this specific authorization. Dkt. No. 10, p. 11 (Pg. ID 66).
JLR counters that NREPA regulations do not specifically authorize the sale of off-4-
road vehicles; do not require licenses for manufacturers or dealers of off-road
vehicles; and do not provide a mechanism through which grievances related to
vehicle purchases may be addressed; and thus BRP’s sale of vehicles does not
qualify for exemption from the MCPA. See Dkt. No. 15, pp.12 (Pg. ID 244).
The Court has thoroughly reviewed recent state and federal cases
determining whether transactions are exempt from the MCPA. A licensed dealer’s
sale of motor vehicles has been found to be exempt from the MCPA. Jimenez v.
Ford Motor Credit Co., No. 322909, 2015 WL 9318913, at *7 (Mich. Ct. App.
Dec. 22, 2015) (sale of motor vehicle by a licensed dealer was specifically
authorized and exempted from the MCPA, where Vehicle Code specifically
required that a dealer obtain dealer license, Secretary of State was responsible for
administration of Vehicle Code, and Vehicle Code provided penalties for
proscribed conduct.). Registration of business and domain names, however, has
been found to be a transaction that is not exempt from the MCPA. Am. Auto. Ass’n,
Inc. v. Advanced Am. Auto Warranty Servs., Inc., No. CIV. A. 09-CV-12351, 2009
WL 3837234, at *6 (E.D. Mich. Nov. 16, 2009) (finding that registration of
business and domain names was not a transaction or conduct specifically
authorized under laws administered by a regulatory board, and thus not exempt
from MCPA). No cases have analyzed whether law specifically authorizes a
manufacturer’s sale of an off-road vehicle.
The Court finds, similar to the findings of Judge Mark A. Goldsmith in
Woodger v. Taylor Chevrolet, Inc., that “[t]aking [Defendant’s] theory to its logical
conclusion, any transaction that is in any way regulated by a governmental board
or officer acting under statutory authority, even minimally, would be wholly
exempt from the MCPA.” No. 14-CV-11810, 2015 WL 5026176, at *7 (E.D.
Mich. Aug. 25, 2015). Defendant has even submitted exhibits arguing that the
MCPA “is virtually dead.” Dkt. No. 10-3. This is a complex issue that requires
interpretation of the scope of the MCPA, a state statute, and the Michigan Supreme
Court’s discussion of that statute. This Court believes that this interpretation would
be best addressed by Michigan’s courts. Therefore, the Court declines to exercise
supplemental jurisdiction over this claim, and dismisses it without prejudice. See
28 U.S.C. § 1367(c)(1).
Accordingly, for the reasons discussed in detail above, the Court GRANTS
Defendant’s Motion to Dismiss  and DISMISSES Plaintiff’s Count IV without
prejudice. The Court further DENIES Plaintiff’s first Motion to Dismiss
Defendant’s Counterclaim Counts II and IV  as moot, without prejudice as to
Defendant’s amended counterclaims.
IT IS SO ORDERED.
February 16, 2017
/s/ Gershwin A Drain
HON. GERSHWIN A. DRAIN
United States District Court Judge
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