Wozniak et al v. Ford Motor Company
Filing
29
OPINION and ORDER Granting Defendant's #19 Motion to Dismiss. Signed by District Judge Stephen J. Murphy, III. (DPar)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
JOSH WOZNIAK, et al.,
Plaintiffs,
v.
Case No. 2:17-cv-12794
HON. STEPHEN J. MURPHY, III
FORD MOTOR COMPANY,
Defendant.
______________________________/
OPINION AND ORDER GRANTING DEFENDANT'S MOTION TO DISMISS
[19]
On December 5, 2017, Plaintiffs filed a 120-count amended class action
complaint. ECF 14. Plaintiffs allege violations of the Magnuson-Moss Warranty Act
and violations of state law in each of the fifty states on behalf of a nationwide class.
See id. All claims arise from Plaintiffs' interactions with Ford as purchasers of Ford
vehicles. Id. Plaintiffs allege that Ford used defectively-designed lug nuts. The defect
allegedly causes the lug nuts to deform and swell, which makes them difficult to
remove from the tires and impedes changing a flat tire. See id. at 623–25. Plaintiffs
further allege that Ford violated its New Vehicle Limited Warranty ("NVLW") by
failing to repair or replace the defective lug nuts when customers notified Ford of the
issue. Id. at 660–64. Defendant filed a motion to dismiss on February 5, 2018. ECF
19. The Court held a hearing on the motion on September 5, 2018. Upon a thorough
consideration of the pleadings and the arguments presented at the hearing, the Court
will grant Defendant's motion.
STANDARD OF REVIEW
When analyzing a motion to dismiss under Civil Rule 12(b)(6), the Court views
the complaint in the light most favorable to the plaintiff, presumes the truth of all
well-pleaded factual assertions, and draws every reasonable inference in favor of the
non-moving party. Bassett v. Nat'l Collegiate Athletic Ass'n, 528 F.3d 426, 430 (6th
Cir. 2008). To survive a motion to dismiss, "the complaint must contain either direct
or inferential allegations respecting all the material elements to sustain a recovery
under some viable legal theory." Nat'l Hockey League Players Ass'n v. Plymouth
Whalers Hockey Club, 419 F.3d 462, 468 (6th Cir. 2005) (citation omitted). It must
allege facts "sufficient 'to raise a right to relief above the speculative level,' and to
'state a claim to relief that is plausible on its face.'" Hensley Mfg. v. ProPride, Inc.,
579 F.3d 603, 609 (6th Cir. 2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555, 570 (2007)).
DISCUSSION
I.
Place-Holder Claims
Plaintiffs allege six claims as placeholders—24, 34, 41,45, 114, and 120 ("Place-
Holder Claims"). The Place-Holder Claims do not assert any claims at all. Therefore,
claims 24, 34, 41, 45, 114, and 120 must be dismissed for failure to state a claim.
II.
State Classes Lacking a Representative
Plaintiffs allege violations of the laws of each of the fifty states but present
factual allegations on behalf of named Plaintiffs in only twenty-seven states. See ECF
14, PgID 507–10 (table of contents listing named Plaintiff's states). Although class-
2
certification analysis may precede standing analysis when "the class certification
issue [is] 'logically antecedent' to the standing issue", Smith v. Lawyers Title Ins. Co.,
No. 07–12124, 2009 WL 514210, at *2 (E.D. Mich. Mar. 2, 2009) (citing Amchem
Prods., Inc. v. Windsor, 521 U.S. 591, 612 (1997) and Oritz v. Fibreboard Corp., 527
U.S. 815, 831 (1999)), our Court has held that " the 'logical[ly] antecedent' language
should be construed in a manner that permits consideration of the standing issue
. . . prior to class certification." Id. at *3. Like the plaintiffs in Smith, the named
Plaintiffs here do not allege injuries in states other than their own or base their
claims on the application of other states' laws. See id. Plaintiffs therefore lack
standing to bring claims under the laws of the remaining twenty-three states. Claims
5, 9, 18, 19, 25, 26, 35, 36, 40, 58, 65, 69, 74, 83, 88, 96, 97, 98, 109, and 1131 must
therefore be dismissed for lack of standing.
III.
Breach of Warranty Claims
Plaintiffs have not alleged facts sufficient to plead a breach of warranty claim
under the Magnuson-Moss Warranty Act or under the laws of any of the states in
which they allege breaches of an express warranty. Ford's NVLW promises to "repair,
replace, or adjust all parts on [a] vehicle that malfunction or fail during normal use
during the applicable coverage period" if the vehicle "is properly operated and
maintained" and "was taken to a Ford dealership for a warranted repair during the
warranty period." ECF 14-14, PgID 1131–32. The relevant warranty period is the
Claims 24, 34, 41, and 120 involved laws of states in which no named Plaintiff has
standing, but the claims constitute place-holder claims that failed to state a claim to
relief. See supra Part I.
1
3
earlier of three years or 36,000 miles and begins on the day the customer takes
delivery of the vehicle or the day it is first put into service, again, whichever is earlier.
See ECF 14, PgID 662. Regardless of whether the Repair or Replace Warranty
qualifies as an express warranty under any applicable state law, Plaintiffs have failed
to adequately plead a breach because they have not pleaded that the named Plaintiff
presented their vehicles to a Ford dealership before the earlier of three years or
36,000 miles occurred. Because the warranty expires upon the earlier of the time or
mileage limits, Plaintiffs must allege both the timeline between the start of the
warranty period and the sought-after repairs and the mileage on their vehicles at the
time of presentment.
The only Plaintiff who properly alleged both a mileage and timeline within the
warranty period is Donald Lycan, but he alleged that he merely presented the lug
nuts to a dealership – and not his vehicle. See ECF 14, PgID 595; see also ECF 14-14,
PgID 1131–32 (listing NVLW's prerequisite to free repair or replacement that the
vehicle be taken to a dealership).
Plaintiffs readily acknowledge the shortcoming of their complaint but
maintain that they do not need to plead the listed requirements to succeed on their
breach-of-warranty claims because they adequately pleaded failure of the warranty's
essential purpose. See ECF 20, PgID 1744. But Plaintiffs pleaded breach of express
warranty for eleven states that have adopted the Uniform Commercial Code's
4
provision regarding essential purpose.2 The provision provides that "[w]here
circumstances cause an exclusive or limited remedy to fail of its essential purpose,
remedy may be had as provided in this Act." U.C.C. § 2-719(2). For a repair-or-replace
remedy to fail its essential purpose, however, the consumer must give the
manufacturer an opportunity to repair or replace the alleged defect during the
warranty period. See Miller v. Gen. Motors, LLC, No. 17-cv-14032, 2018 WL 2740240,
at *6–7 (E.D. Mich. June 7, 2018).3 The essential purpose doctrine in each relevant
See Fla. Stat. Ann. § 672.719 (Florida), 810 Ill. Comp. Stat. 5/2-719 (Illinois), Mass.
Gen. Laws Ann. ch. 106, § 2-719 (Massachusetts), Mich. Comp. Laws § 440.2719
(Michigan), Minn. Stat. § 336.2-719 (Minnesota), N.J. Stat. Ann. § 12A:2-719 (New
Jersey), N.Y. U.C.C. Law § 2-719 (New York), N.C. Gen. Stat. Ann. § 25-2-719 (North
Carolina), Ohio Rev. Code Ann. § 1302.93 (Ohio), 13 Pa. Cons. Stat. § 2719
(Pennsylvania), and Tenn. Code Ann. § 47-2-719 (Tennessee).
2
This is true under the law of every relevant state.
Florida:
PB Prop. Mgmt., Inc. v. Goodman Mfg. Co., No. 3:12–cv–1366–J–
20JBT, 2013 WL 12172912, at *3 (M.D. Fla. Aug. 28, 2013) (collecting cases showing
that under Florida law "[t]he 'essential purposes' exception typically has been limited
to circumstances involving repeated (unsuccessful) efforts to repair a product that
completely fails in its intended use").
Illinois:
Pearson v. DaimlerChrysler Corp., 813 N.E.2d 230, 236 (Ill. App. Ct.
2004) (holding that under Illinois law failure of essential purpose occurs when
"successful repairs are not made within a reasonable time or within a reasonable
number of attempts," assuming that the manufacturer must first be given the
opportunity to repair).
Massachusetts: Boston Helicopter Charter, Inc. v. Augusta Aviation Corp., 767 F.
Supp. 363, 374 (D. Mass. 1991) (holding that the essential purpose provision of the
Massachusetts U.C.C. "is inapplicable once the warranty has expired").
Michigan:
Comput. Network, Inc. v. AM Gen. Corp., 696 N.W.2d 49, 55 (Mich.
Ct. App. 2005) (under Michigan law, a "warranty fails of its essential purpose where
unanticipated circumstances preclude the seller from providing the buyer with the
remedy to which the parties agreed") (citation omitted) (emphasis added).
Minnesota:
Durfee v. Rod Baxter Imports, Inc., 262 N.W.2d 349, 356 (Minn. 1977)
(discussing failure of essential purpose under Minnesota law in terms of whether a
manufacturer complies with the terms of the exclusive or limited remedy and whether
a failure to comply deprives the purchaser of the benefit of the contracted-for remedy).
3
5
state is concerned with circumstances in which the essential purpose of the limited
remedy agreed to by the parties would fail—in this case, the circumstances are repair
or replacement of defective parts during the warranty period. See supra fn 3.
To plead that a remedy failed its essential purpose, Plaintiffs must plead facts
sufficient to allege that they sought the limited remedy in the warranty period and
that the remedy was ineffective. As discussed above, Plaintiffs have not alleged that
they presented their vehicles to Ford within the warranty period to have the defective
lug nuts replaced. For the same reasons that Plaintiffs fail to allege facts sufficient
New Jersey:
BOC Grp., Inc. v. Chevron Chem. Co., LLC, 819 A.2d 431, 438 (N.J.
Super. Ct. App. Div. 2003) (stating that under New Jersey law, "before the exclusive
remedy is considered to have failed in its essential purpose, the seller must be given
an opportunity to repair or replace the product").
New York:
Kraft v. Staten Island Boat Sales, Inc., 715 F. Supp. 2d 464, 475
(S.D.N.Y. 2010) (stating that under New York law, a limited or exclusive remedy fails
of its essential purpose when "the circumstances existing at the time of the agreement
have changed so that enforcement of the limited remedy would essentially leave
plaintiff with no remedy at all") (citation omitted).
North Carolina: Stutts v. Green Ford, Inc., 267 S.E.2d 919, 926 (N.C. Ct. App. 1980)
(discussing a comment to North Carolina's essential purpose provision emphasizing
it ensures that "at least minimum adequate remedies be available").
Ohio:
Holbrook v. Louisiana-Pacific Corp., No. 3:12CV484, 2015 WL
1291534, at *6 (N.D. Ohio Mar. 23, 2015) (stating that under Ohio law, a repair or
replace remedy fails its essential purpose "when evidence shows that the seller either
refuses to repair or replace the goods or, despite attempting repair, the seller was not
able to cure its breach") (citation omitted).
Pennsylvania: Woolums v. Nat'l RV, 530 F. Supp. 2d 691, 701 (M.D. Penn. 2008)
(discussing the need for a seller to "perform repairs within a reasonable amount of
time after the buyer presents the defective product" for a repair warranty to uphold
its essential purpose) (emphasis added).
Tennessee:
Arcata Graphics Co. v. Heidelberg Harris, Inc., 874 S.W.2d 15, 29
(Tenn. Ct. App. 1993) (stating that Tennessee's essential purpose provision is
"concerned with the essential purpose of the remedy chosen by the parties, not with
the essential purpose of the code or of contract law, or of justice and/or equity.")
(emphasis added).
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to state a claim upon which relief can be granted for breach of the express warranty,
they also fail to state a claim that the limited remedy failed of its essential purpose.
Claims 23, 32, 48, 52, 57, 73, 78, 82, 87, 95, and 101 must therefore be dismissed.
Furthermore, "the applicability of the Magnuson–Moss Act is directly
dependent [sic] upon a sustainable claim for breach of warranty. . . . Thus, if there
exists no actionable warranty claim, there can be no violation of the Magnuson–Moss
Act." Temple v. Fleetwood Enters., Inc., 133 F. App'x 254, 268 (6th Cir. 2005). Claim
1 must also be dismissed.
IV.
Fraud and Consumer Protection Claims
Plaintiffs have not alleged facts sufficient to plead state-law fraud or consumer
protection claims. Fraud claims and consumer protection claims sounding in fraud
must meet the heightened pleading standard of Civil Rule 9(b). See Miller, 2018 WL
2740240, at *14 (quoting Spaulding v. Wells Fargo Bank, N.A., 714 F.3d 769, 781 (4th
Cir. 2013)). For claims involving affirmative misrepresentations, Civil Rule 9(b)
requires a plaintiff to allege "the time, place, and content of the alleged
misrepresentation on which he or she relied; the fraudulent scheme; the fraudulent
intent of the defendants; and the injury resulting from the fraud." Id. at *11 (quoting
Cataldo v. U.S. Steel Corp., 676 F.3d 542, 551 (6th Cir. 2012)).
And for claims involving fraudulent omissions, Civil Rule 9(b) requires a
plaintiff to plead "'the who, what, when, where, and how' of the alleged omission." Id.
(quoting Republic Bank & Tr. Co. v. Bear Stearns & Co., 683 F.3d 239, 256 (6th Cir.
2012)). Specifically, a plaintiff pleading a fraudulent omission must allege "(1)
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precisely what was omitted; (2) who should have made a representation; (3) the
content of the alleged omission and the manner in which the omission was
misleading; and (4) what [defendant] obtained as a consequence of the alleged fraud."
Id. (alteration in original) (citing Republic Bank & Tr. Co., 683 F.3d at 256). A
complaint may suffice under the applicable standard if it alleges that a manufacturer
knew of a defect before sale, the various venues the manufacturer used to sell the
product failed to disclose the defect, and that the plaintiffs would not have purchased
the product or would have paid less for it had they known of the defect. See Beck v.
FCA US LLC, 273 F. Supp. 3d 735, 751–52 (E.D. Mich. 2017).
The Plaintiffs’ complaint is devoid of any state-law fraud or consumer
protection claims based on a misrepresentation theory. Plaintiffs simply have not
pleaded any representations related to lug nuts.
As to Plaintiffs' fraudulent omissions theory, Plaintiffs insist that they
pleaded, consistent with Beck, that Ford knew of the defect before the sale of the
vehicles and that the various channels through which they sold the vehicles failed to
disclose the defect. See ECF 20, PgID 1764–65. But the argument is unpersuasive.
Plaintiffs failed to plead their asserted "what" of Ford's knowledge of the defect.
Plaintiffs point only to negative reviews on third-party forum websites and
complaints filed with the National Highway Traffic Safety Administration
("NHTSA"). They argue that Defendant knew of the defects because of those outside
sources. See ECF 14, PgID 626–60; see also Beck, 273 F. Supp. 3d at 753 (allegations
8
of complaints to NHTSA are insufficient to allege knowledge).4 Although "knowledge"
need be alleged only "generally" under Civil Rule 9(b), Plaintiffs' general assertions
of Defendant's knowledge without any alleged facts that Defendant was even aware
of the complaints do not rise above mere speculation. See Twombly, 550 U.S. at 545.
Under their formulation of the "who, what, when, where, and how," Plaintiffs have
failed to plead a "what" necessary to satisfy Civil Rule 9(b)'s heightened pleading
standard.5 Liability cannot attach for a fraudulent omission theory under any state
Although Beck makes the cited assertion only in the context of analyzing whether
the plaintiff sufficiently pleaded superior or exclusive knowledge for a specific statelaw claim, the conclusion that complaints to the NHTSA are insufficient to "allege
that [the manufacturer] had knowledge—let alone exclusive knowledge" is applicable
to the Court's analysis of whether Plaintiffs adequately pleaded the "what" of Ford's
knowledge here. Moreover, the Beck plaintiff alleged that the Defendant "regularly
monitor[ed] NHTSA complaints in order to meet its reporting requirements[.]" 273 F.
Supp. 3d at 753. Even that allegation was insufficient to prove Defendant's
knowledge of the defect.
And Plaintiffs' reliance on In re Toyota Motor Corp., 754 F. Supp. 2d 1145 (C.D.
Cal. 2010) to rebut the conclusion of insufficiency to show knowledge is misplaced.
The court in In re Toyota found superior or exclusive knowledge when the plaintiff
alleged the manufacturer produced secret reports, consumers shared issues with
dealers prior to notifying the NHTSA, and the NHTSA produced a "finding" regarding
the complaints. The allegations In re Toyota far exceed Plaintiffs' allegations here
that complaints were made to the NHTSA and other third parties.
4
Notably, to succeed on an omission theory, each state consumer protection act and
common-law fraud scheme relied upon by Plaintiffs requires knowledge of the defect
by the defendant, or at least that the defendant should have known of the defect
through reasonable inquiry.
Alabama:
Sam v. Beaird, 685 So. 2d 742, 744 (Ala. Civ. App. 1996) (holding that
Alabama Deceptive Trade Practices Act requires "some knowledge of false or
deceptive conduct"); Marshall v. Crocker, 387 So. 2d 176, 179 (Ala. 1980) ("[S]ilence,
in order to be an actionable fraud, must relate to a material matter, known to the
party, and which it is his legal duty to communicate to the other contracting party[.]")
(emphasis added).
Arizona:
In re Arizona Theranos, Inc., Litig., 256 F. Supp. 3d 1009, 1023 (D.
Ariz. 2017) (holding that Arizona Consumer Fraud Act and Arizona common law
5
9
fraud require a manufacturer to intend that the consumer rely on the omission, which
presumes that the manufacturer knows of the omission).
California:
In re Adobe Sys., Inc. Privacy Litig., 66 F. Supp. 3d 1197, 1229 (N.D.
Cal. 2014) (holding that omissions are actionable under the California Unfair
Competition Law only when there is a duty to disclose—when the defendant is the
plaintiff's fiduciary, has exclusive knowledge, actively conceals, or partially
represents in a way that makes the omission misleading—the first of which does not
apply here and the latter three of which all require knowledge); Herron v. Best Buy
Co., 924 F. Supp. 2d 1161, 1174–75 (E.D. Cal. 2013) (applying the same standard as
In re Adobe for omissions claims under the California Consumers Legal Remedies
Act); Beyer v. Symantec Corp., 333 F. Supp. 3d 966, 974–75 (N.D. Cal. 2018) (same
for California False Advertising Law); Romero v. Securus Tech., Inc., 216 F. Supp. 3d
1078, 1092 (S.D. Cal. 2016) (same for California common law fraud).
Colorado:
Campfield v. State Farm Mut. Auto. Ins. Co., 532 F.3d 1111, 1120
(10th Cir. 2008) (identifying knowledge requirement for omissions to be actionable
under the Colorado Consumer Protection Act); Denver Bus. Sales Co. v. Lewis, 365
P.2d 895, 898 (Colo. 1961) (same for Colorado common law fraud).
Florida
Varner v. Domestic Corp., No. 16-22482-Civ-Scola, 2017 WL 3730618,
at *15 (S.D. Fla. Feb. 7, 2017) (requiring plaintiffs to "plead with particularity facts
sufficient to show [the defendant's] knowledge of the risk" plaintiffs alleged defendant
omitted to inform them about under California, Florida, Kansas, Michigan,
Minnesota, North Carolina and Texas's consumer protection laws); Drilling
Consultants, Inc. v. First Montauk Sec. Corp., 806 F. Supp. 2d 1228, 1236 (M.D. Fla.
2011) (holding that Florida common law fraud requires not only knowledge but also
intent to induce reliance).
Idaho:
United Heritage Life Ins. Co. v. First Matrix Inv. Servs. Corp., No. CV
06–0496–S–MHW, 2009 WL 3229374, at *7 (D. Idaho Sept. 30, 2009) (holding that
Idaho Consumer Protection Act requires knowledge of present or past engagement in
unfair or deceptive practices—which Plaintiffs certainly have not pleaded in the
absence of adequately pleading knowledge of the defect); Wash. Fed. Sav. v. Van
Engelen, 289 P.3d 50, 59 (Idaho 2012) (holding that fraud can be established by
omission only when there is a duty to disclose (which requires a fiduciary relationship
and is thus inapplicable here), to prevent partial statements from being misleading,
or if a fact known to one party is so integral that if it were a mutual mistake the
contract would be voidable—the last two require knowledge).
Illinois:
Rockford Mem'l Hosp. v. Havrilesko, 858 N.E. 2d 56, 62 (Ill. App. Ct.
2006) ("[F]or a material omission to be actionable, the plaintiff must establish that
the fact concealed was known to the defendant at the time of the concealment."); Fox
v. Heimann, 872 N.E. 2d 126, 138 (Ill. App. Ct. 2007) (recognizing that a defendant's
"knowledge of the falsity of the statement, or a deliberate concealment with the intent
to deceive is an essential element of common law fraud").
Kentucky:
Smith v. Gen. Motors Corp., 979 S.W. 2d 127, 129–31 (Ky. Ct. App.
1998) (holding that omissions actionable under either the Kentucky Consumer
10
Protection Act or Kentucky common-law fraud only where fiduciary relationship
(inapplicable here) or to prevent partial statements from being misleading or where
one party has superior knowledge—both of which require knowledge).
Maryland:
Benik v. Hatcher, 750 A.2d 10, 23 (Md. 2000) (noting that, under the
Maryland Consumer Protection Act, the element of "material misstatements or
omissions" requires knowledge on the part of the defendant); Green v. H&R Block,
Inc., 735 A.2d 1039, 1059 (Md. 1999) (holding that Maryland fraud requires intent to
defraud or deceive, which presumes knowledge of the omission).
Massachusetts: Roadmaster Indus., Inc. v. Columbia Mfg. Co., Inc., 893 F. Supp.
1162, 1179 (D. Mass. 1995) (holding that fraudulent concealment under
Massachusetts law requires affirmative steps to conceal, which implies knowledge).
Michigan:
Wolfe v. A.E. Kusterer & Co., 257 N.W. 729, 730 (Mich. 1934) (holding
that fraud by omission is actionable under Michigan law only if there is an intent to
deceive, which presumes knowledge).
Minnesota:
Nance v. Evje, No. A06-1730, 2007 WL 2472449, at *3, *5 (Minn. Ct.
App. 2007) (holding that claims under both the Minnesota Deceptive Trade Practices
Act and Minnesota common law fraud fail when there is no evidence that the
defendants knew the omitted information).
Missouri:
Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 774 (Mo.
2007) (en banc) (holding that Missouri common law fraud requires knowledge of facts
omitted and the Missouri Merchandising Practices Act requires that a defendant
knew or should have known through reasonable inquiry of an omission—although
Missouri courts have yet to develop their jurisprudence regarding what meets the
standard, discovering the cited complaints on third-party websites would require
more than reasonable inquiry by Defendant).
Montana:
Moline v. Saint-Denis, 311 P.3d 442, at *2 (Mont. 2013) (Table)
(requiring knowledge for an omission-based claim under the Montana Unfair Trade
Practices and Consumer Protection Act); In re Estate of Kindsfather, 108 P.3d 487,
490 (Mont. 2005) (holding that Montana common-law fraud requires knowledge and
intent).
Nevada:
Joson v. Bank of Am., NA, No. 2:12–cv–00710–GMN–NJK, 2013 WL
1249714, at *5, *6 (D. Nev. Mar. 22, 2013) (holding that Nevada Deceptive Trade
Practices Act and common-law fraud both require knowledge).
New Jersey:
Cox v. Sears Roebuck & Co., 647 A.2d 454, 462 (N.J. 1994) (New
Jersey Consumer Fraud Act claims based on omissions require knowledge); Liebler v.
LG Elecs. U.S.A., Inc., No. 14–cv–03500, 2015 WL 3561590, at *7 (D.N.J. June 4,
2015) (same for New Jersey common-law fraud).
New York:
In re Sling Media Slingbox Advert. Litig., 202 F. Supp. 3d 352, 359
(S.D.N.Y. 2016) (holding that the New York General Business Law requires a plaintiff
to plausibly allege that a defendant had knowledge of material information and failed
to disclose it); Dodona I, LLC v. Goldman, Sachs & Co., 847 F. Supp. 2d 624, 639
(S.D.N.Y. 2012) (holding that New York common-law fraud requires knowledge of a
false omission and an intent to defraud).
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North Carolina: Breeden v. Richmond Cmty. Coll., 171 F.R.D. 189, 196 (M.D.N.C.
1997) (holding that fraud by omission is satisfied if one party takes affirmative steps
to conceal material facts of a defect or has knowledge of a defect).
Ohio:
Bierlein v. Bernie's Motor Sales, Inc., No. 9590, 1986 WL 6757, at *6
(Ohio Ct. App. June 12, 1986) (stating that Ohio's Consumer Sales Practices Act
requires a defendant to have actual awareness of a defect); Martin v. Ohio State Univ.
Found., 742 N.E.2d 1198, 1206–07 (Ohio Ct. App. 2000) (holding that Ohio commonlaw fraud requires knowledge or recklessness to an extent that knowledge can be
inferred, as well as intent to mislead).
Oregon:
State ex rel. Rosenblum v. Johnson & Johnson, 362 P.3d 1197, 1203–
04 (Or. Ct. App. 2015) (implying knowledge requirement for nondisclosures
challenged under The Oregon Unfair Trade Practices Act); Aero Marine Engine, Inc.
v. Transporter, Inc., No. 05–1469–AS, 2007 WL 3128500, at *3 (D. Or. Oct. 23, 2007)
(requiring knowledge for Oregon common-law fraud).
Pennsylvania: Belmont v. MB Inv. Partners, Inc., 708 F.3d 470, 498 (3d Cir. 2013)
(noting that relevant provision of Pennsylvania Unfair Trade Practices and
Consumer Protection Act requires knowledge of falsity of statements or misleading
nature of acts); Viguers v. Philip Morris USA, Inc., 837 A.2d 534, 540 (Pa. Super. Ct.
2003) (holding that for an omission to constitute fraud, there must be intentional
concealment, which implies knowledge).
Tennessee:
Faye v. Vincent, 301 S.W.3d 162, 177 (Tenn. 2009) (holding that
failure to disclose material facts can incur liability coextensive with affirmative
misrepresentations under the Tennessee Consumer Protection Act but relying on
cases regarding Tennessee common-law fraud for this idea, which specify that the
coextensive liability applies only to omissions of known facts. See, e.g., Justice v.
Anderson Cty., 955 S.W.2d 613, 616 (Tenn. Ct. App. 1997)).
Texas:
Bradford v. Vento, 48 S.W.3d 749, 754–55 (Tex. 2001) (requiring
knowledge for Texas common-law fraud).
Utah:
Martinez v. Best Buy Co., Inc., 283 P.3d 521, 523 (Utah Ct. App. 2012)
(requiring "intentional or knowing behavior" to violate Utah Consumer Sales
Practices Act); Elder v. Clawson, 384 P.2d 802, 804 (Utah 1963) (holding that
omissions are actionable as Utah common-law fraud only for matters known to
defendant).
Virginia:
Guy v. Tidewater Inv. Props., No. L-95-1194, 1996 WL 33465397, at
*10 (Va. Cir. Ct. 1996) (holding that "concealment" can qualify as a misrepresentation
under the Virginia Consumer Protection act or Virginia common-law fraud, but
"concealment" is described as actively hiding a fact, which necessarily implies
knowledge of the concealed fact).
West Virginia: Soyoola v. Oceanus Ins. Co., 986 F. Supp. 2d 695, 709 (S.D.W. Va.
2013) (holding that West Virginia common-law fraud by omission requires intent to
mislead or defraud by "one with knowledge, or the means of knowledge").
Wisconsin:
Tietsworth v. Harley-Davidson, Inc., 677 N.W.2d 233, 245 n.4 (Wis.
2004) (holding that fraud by omission is not actionable under the Wisconsin Deceptive
12
fraud or consumer protection law without a properly pleaded "what" of the alleged
omission, namely, Ford's knowledge of the lug nut defect. Claims 2, 3, 6, 7, 10, 11, 12,
13, 15, 16, 20, 21, 27, 28, 30, 31, 37, 38, 42, 43, 46, 49, 50, 53, 54, 55, 59, 60, 62, 63,
66, 67, 70, 71, 75, 76, 79, 80, 84, 85, 89, 90, 92, 93, 99, 100, 103, 104, 106, 107, 110,
111, 115, 117, and 118 must therefore be dismissed.
V.
Unjust Enrichment Claims
Finally, Plaintiffs assert unjust enrichment claims under the laws of several
states. Plaintiffs fail, however, to allege facts sufficient to establish that Ford
obtained any benefit from the complained-of conduct. Plaintiffs base their unjust
enrichment claims on: (1) an allegation that Ford's defective lug nuts are less
expensive than other lug nuts, and (2) an allegation that by refusing to replace the
lug nuts, Ford benefits from having neither to purchase new lug nuts for its customers
nor to reimburse its dealers for replacing the lug nuts. ECF 14, PgID 619–20. Neither
of those allegations, however, sufficiently allege facts that Ford obtained a benefit.
Concerning the statement that the two-piece lug nuts are cheaper than other lug
nuts, Plaintiffs allege no facts supporting the assertion. Counsel for Plaintiffs
conceded during the hearing on the motion to dismiss that the two-piece lug nuts
Ford uses are more expensive to purchase on the open market than other lug nuts.
The lack of facts supporting the assertion that the two-piece lug nuts are cheaper
Trade Practices Act); State v. Abbott Labs., 816 N.W.2d 145, 161 (Wis. 2012) (holding
that Wisconsin common-law fraud requires intent to defraud or induce action, which
necessarily requires knowledge of an omitted fact).
13
than other lug nuts— especially in light of contradictory evidence presented during
the motion hearing—fails to raise the claim above the speculative level.
Regarding the assertion that Ford benefits by not having to purchase new lug
nuts for its customers or reimburse its dealers, if true, those facts would benefit Ford
only if Ford otherwise had a duty to pay for the lug nut replacements. And the sole
time that Ford has such a duty is if a customer's lug nuts were subject to a valid
Repair and Replace Warranty. Because the Court already determined that Plaintiffs
failed to adequately plead presentment within the warranty period, the second basis
for the unjust enrichment claims necessarily is without merit. Because Plaintiffs fail
to allege facts sufficient to plead any unjust enrichment claim, claims 4, 8, 14, 17, 22,
29, 33, 39, 44, 47, 51, 56, 61, 64, 68, 72, 77, 81, 86, 91, 94, 102, 105, 108, 112, 116, and
119 must be dismissed.
Accordingly, plaintiffs have presented no legally viable claims, and the Court
must dismiss the case in its entirety.
WHEREFORE, it is hereby ORDERED that Defendant's motion to dismiss
Plaintiffs' first amended class action complaint [19] is GRANTED.
IT IS FURTHER ORDERED that the case is DISMISSED.
SO ORDERED.
Dated: January 4, 2019
s/Stephen J. Murphy, III
STEPHEN J. MURPHY, III
United States District Judge
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CERTIFICATE OF SERVICE
I hereby certify that a copy of the foregoing document was served upon the parties
and/or counsel of record on January 4, 2019, by electronic and/or ordinary mail.
s/David P. Parker
Case Manager
15
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