BLOCK v. JAGUAR LAND ROVER NORTH AMERICA, LLC
Filing
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OPINION AND ORDER denying as moot 9 Motion to Dismiss; granting in part and denying in part 17 Motion to Dismiss; and it further ORDERED that, as to the First, Second, Third and Fourth Counts in the Amended Complaint, the motion to dismiss is G RANTED, and these claims are hereby DISMISSED without prejudice; and it is further ORDERED that, as to the Sixth Count in the Amended Complaint for Plaintiff Block only, the motion to dismiss is GRANTED, and the Sixth Count for Plaintiff Block only is hereby DISMISSED without prejudice; and it is further ORDERED that, as to the remaining claims in the Amended Complaint, the motion to dismiss is DENIED. Signed by Judge Stanley R. Chesler on 5/26/2016. (seb)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
AMY BLOCK and VICTORYA
MANAKIN, on behalf of themselves and
all others similarly situated,
Plaintiff,
v.
JAGUAR LAND ROVER
NORTH AMERICA, LLC,
Defendant.
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Civil Action No. 15-5957 (SRC)
OPINION & ORDER
CHESLER, U.S.D.J.
This matter comes before this Court on the motion to dismiss the Amended Complaint for
failure to state a valid claim for relief, pursuant to Federal Rule of Civil Procedure 12(b)(6), by
Defendant Jaguar Land Rover North America, LLC (“Jaguar”). For the reasons stated below, the
motion will be granted in part and denied in part.
This case arises from a dispute between Plaintiffs, purchasers of Land Rover vehicles,
and the manufacturer, Jaguar. In short, the Amended Complaint alleges that the purchased
vehicles were defective and asserts six counts: 1) violation of the New Jersey Consumer Fraud
Act (“NJCFA”); 2) common law fraud; 3) unjust enrichment; 4) breach of the implied covenant
of good faith and fair dealing; 5) breach of express warranty; and 6) breach of implied warranty.
Jaguar now moves to dismiss all six claims for failure to state a valid claim for relief.1
1
The Court notes that Plaintiffs begin their opposition with the general statement that
motions to dismiss are disfavored in this context, quoting Elias v. Ungar's Food Prods., Inc., 252
F.R.D. 233, 239 (D.N.J. 2008). Plaintiffs have quoted Elias out of context: the Elias court was
not addressing a Rule 12(b)(6) motion to dismiss, but a motion to certify a class. Id.
Jaguar first argues that the NJCFA does not apply to Plaintiff Manakin’s consumer fraud
claim. The Amended Complaint alleges that Manakin is a citizen of Massachusetts, Manakin
purchased a Land Rover from a dealer in Massachusetts, and Jaguar is a citizen of New Jersey,
where it maintains its principal place of business. The parties dispute which state’s consumer
fraud law this Court should apply: that of New Jersey, or that of Massachusetts.
The Third Circuit has stated the fundamental legal principles for such a choice-of-law
analysis as follows:
A federal court sitting in diversity applies the choice-of-law rules of the forum
state—here, New Jersey—to determine the controlling law. Klaxon Co. v. Stentor
Elec. Mfg. Co. Inc., 313 U.S. 487, 496 (1941); Thabault v. Chait, 541 F.3d 512,
535 (3d Cir. 2008). New Jersey has adopted the “most significant relationship”
test set forth in the Restatement (Second) of Conflict of Laws. P.V. v. Camp
Jaycee, 197 N.J. 132, 962 A.2d 453, 459-60 (N.J. 2008). This is a two-part test.
The first part of the choice-of-law inquiry is to determine whether or not an actual
conflict exists between the laws of the potential forums. . .
Under the second part of the inquiry, the court must determine which jurisdiction
has the “most significant relationship” to the claim. Camp Jaycee, 962 A.2d at
461. Where a fraud or misrepresentation claim has been alleged, the court looks to
the factors set forth in § 148 of the Restatement (Second) of Conflict of Laws.
Under subsection (1) of § 148, when the “plaintiff's action in reliance took place
in the state where the false representations were made and received,” there is a
presumption that the law of that state applies. Under subsection (2), when the
plaintiff’s action in reliance takes place in a different state than where the false
representations were made and received, courts weigh the following factors:
(a) the place, or places, where the plaintiff acted in reliance upon
the defendant's representations,
(b) the place where the plaintiff received the representations,
(c) the place where the defendant made the representations,
(d) the domicil, residence, nationality, place of incorporation and
place of business of the parties,
(e) the place where a tangible thing which is the subject of the
transaction between the parties was situated at the time, and
(f) the place where the plaintiff is to render performance under a
contract which he has been induced to enter by the false
representations of the defendant.
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§ 148(2). The factors enumerated in [the Restatement] should be evaluated on a
qualitative rather than a quantitative basis.
Maniscalco v. Brother Int'l (USA) Corp., 709 F.3d 202, 206-207 (3d Cir. 2013).
The parties agree that there is an actual conflict of laws and that this Court must apply the
“most significant relationship” test stated in § 148 of the Restatement (Second) of Conflict of
Laws to determine which state’s consumer fraud law applies to Manakin’s consumer fraud
claim. The parties also agree that Manakin’s action in reliance took place in Massachusetts,
while the allegedly false representations were made in New Jersey. Thus, Manakin’s action in
reliance did not take place in the state where the allegedly false representations were made, and
so the Court must look to § 148(2). It is at this point that the parties’ positions on this issue
diverge.
Looking at the six factors in § 148(2), Jaguar contends that only factor (c) favors New
Jersey, while the remaining factors favor Massachusetts. Plaintiffs contend that both factors (c)
and (d) favor New Jersey. In support of its position, Jaguar persuasively cites Maniscalco:2
Although [Plaintiff] is a domiciliary of South Carolina and [Defendant]’s place of
business is in New Jersey, factor (d) weighs slightly in favor of applying South
Carolina law. See § 148 cmt. i. (noting, in cases of pecuniary loss, that “[t]he
domicil, residence and place of business of the plaintiff are more important than
are similar contacts on the part of the defendant” because “financial loss will
usually be of greatest concern to the state with which the person suffering the loss
has the closest relationship”).
Maniscalco, 709 F.3d at 208. This reasoning holds true in this case: the case involves financial
loss, which would be of greater concern to Massachusetts, the state with which Manakin, who
2
There are important similarities between the facts in Maniscalco and those alleged here:
at issue in both is a claim under the NJCFA by an out-of-state consumer/purchaser of
merchandise sold by a company with a principal place of business in New Jersey. Maniscalco,
709 F.3d at 203.
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suffered the loss, has the closest relationship. Thus, of the six factors, only factor (c) favors New
Jersey as the state with the most significant relationship to Manakin’s claim.
As Jaguar points out, similarly, in Maniscalco, the Third Circuit found that only factor (c)
weighed in favor of New Jersey. Id. The Third Circuit then stated:
The only remaining questions are whether the place where [Defendant]’s alleged
omissions took place, factor (c), weighs in favor of applying New Jersey law, and,
if so, whether this contact is of such significance that it outweighs the contacts in
favor of applying South Carolina law. We find that it does not.
Accepting [Plaintiff]’s premise that there were actionable omissions by
[Defendant] at its headquarters in New Jersey, we conclude that this single
contact—factor (c)—does not warrant applying New Jersey law. Nothing else
about the relationship between the parties, other than the fortuitous location of
[Defendant]’s headquarters, took place in the state of New Jersey. [Plaintiff]’s
home state, in which he received and relied on [Defendant]’s alleged fraud, has
the “most significant relationship” to his consumer fraud claim. In so concluding,
we adopt the overwhelming majority of courts’ application of New Jersey
choice-of-law rules under similar circumstances.
Id. at 208-209. Just as in Maniscalco, as regards Plaintiff Manakin, nothing, other than the
location of Defendant’s headquarters, took place in New Jersey. This Court follows Maniscalco
and finds that Massachusetts has the most significant relationship with Manakin’s consumer
fraud claim.
In Maniscalco, the Third Circuit held that, because New Jersey law did not apply to the
plaintiff’s consumer fraud claim, the district court had properly granted summary judgment in
favor of defendant. Id. at 211. In view of this, this Court finds that the Amended Complaint
does not state a valid claim for relief under the NJCFA for Manakin. As to Manakin’s NJCFA
claim, the motion to dismiss will be granted, and that claim will be dismissed without prejudice.
Jaguar next argues that the common law fraud claims, which are the Second Count, and
Block’s NJCFA claim, which is the First Count, fail to meet the pleading requirements of
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Federal Rule of Civil Procedure 9(b), which states: “In alleging fraud or mistake, a party must
state with particularity the circumstances constituting fraud or mistake.” The Third Circuit has
explained:
In order to satisfy Rule 9(b), plaintiffs must plead with particularity the
‘circumstances’ of the alleged fraud in order to place the defendants on notice of
the precise misconduct with which they are charged, and to safeguard defendants
against spurious charges of immoral and fraudulent behavior. Plaintiffs may
satisfy this requirement by pleading the date, place or time of the fraud, or
through alternative means of injecting precision and some measure of
substantiation into their allegations of fraud. Plaintiffs also must allege who
made a misrepresentation to whom and the general content of the
misrepresentation.
Lum v. Bank of Am., 361 F.3d 217, 223-224 (3d Cir. 2004) (citations omitted).
The First and Second Counts of the Amended Complaint contain only abstract and
general statements, alleging conscious misrepresentation. (Am. Compl. ¶¶ 93, 99.) No specifics
of the alleged misrepresentation are given in the claims. The Amended Complaint does not
allege any specific facts about the misrepresentations in other sections, either. The section which
alleges specific facts about Block’s and Manakin’s experiences with their Land Rover vehicles
deals largely with the alleged manufacturing defects and repair history and contains no specific
allegations about misrepresentations made to the Plaintiffs.
In opposition, Plaintiffs argue that the Third Circuit applies a “relaxed” pleading standard
in cases in which factual information is in the exclusive control of the defendant. Even if true,
this is unpersuasive: Plaintiffs here would be the parties in the best position to know the specifics
of what misrepresentations were made to them. A consumer alleging fraudulent
misrepresentation should not need discovery to allege the basic facts of what the fraudulent
misrepresentation was. Plaintiffs also contend that the Amended Complaint does plead the
“who, what, how, when and where” of the omissions. This is not so: as discussed, the specific
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factual allegations in paragraphs 17 through 37 of the Amended Complaint do not identify when
and how, what omissions produced what specific misrepresentations to either Plaintiff. This
Court finds that the Amended Complaint fails to plead with particularity the circumstances of the
alleged fraud, as required by Federal Rule of Civil Procedure 9(b). As to Counts One and Two,
the motion to dismiss the Amended Complaint will be granted, and Counts One and Two will be
dismissed without prejudice.
As to the Third Count, for unjust enrichment, Jaguar contends that New Jersey courts
require a direct relationship between a plaintiff and a defendant, and the Amended Complaint
does not allege one. In opposition, Plaintiffs contend that New Jersey courts require only a
“sufficient nexus between the conferrer of the benefit and the recipient.” (Pls.’ Opp. Br. 36.)
Plaintiffs cite two cases in support: In re K-Dur Antitrust Litig., 338 F. Supp. 2d 517, 546
(D.N.J. 2004) and Nelson v. Xacta 3000 Inc., No. CIV.A.08-5426 (MLC), 2009 WL 4119176, at
*7 (D.N.J. Nov. 24, 2009). In both cases, federal district courts used the qualification
“sufficient” or “sufficiently” in dicta; in neither case did that court deny a motion to dismiss on
the ground that New Jersey law does not require a direct relationship between the conferrer and
the recipient, but only a sufficiently direct relationship. These two cases do not persuade this
Court that New Jersey law uses a “sufficiently direct relationship” standard. Jaguar, in contrast,
cites a number of district court cases in which courts have granted a motion to dismiss an unjust
enrichment claim because the complaint failed to allege a direct relationship between the
conferrer and the recipient. See, e.g., Glass v. BMW of N. Am., LLC, No. CIV.A. 10-5259 ES,
2011 WL 6887721, at *16 (D.N.J. Dec. 29, 2011). Although it does not appear that the New
Jersey Supreme Court has addressed this issue, the Appellate Division has, in several cases, held
that a direct relationship is required, such that it would be reasonable for one party to expect
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remuneration from the other. See, e.g., Fasching v. Kallinger, 211 N.J. Super. 26, 35 (N.J.
Super. Ct. App. Div. 1986) (citing Callano v. Oakwood Park Homes Corp., 91 N.J. Super. 105,
109 (N.J. Super. Ct. App. Div. 1966). This Court finds that New Jersey law requires a claim for
unjust enrichment to allege a direct relationship between the conferrer of a benefit and the
recipient. Because the Amended Complaint does not meet this requirement, the motion to
dismiss the Third Count will be granted, and the Third Count will be dismissed without
prejudice.
Jaguar next argues that, as to the Fifth Count, for breach of express warranty, the
Amended Complaint fails to plead sufficient facts to support a claim. A complaint “must contain
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). Jaguar contends that the Amended Complaint does
not plead that the alleged defect manifested itself within the warranty period, nor that each
Plaintiff brought her vehicle to a dealership for service during the warranty period, in
compliance with the express warranty’s terms.
The Amended Complaint does not support Jaguar’s position. As to Block, paragraphs 19
and 20 plead sufficient facts to state a claim for relief that is plausible on its face: the alleged
defect manifested itself within the warranty period, etc. As to Manakin, paragraph 31 alleges
that the defect manifested itself during the warranty period, that the vehicle was brought to a
dealership, and that the defect continue to manifest after that visit. Iqbal requires no more than
sufficient factual assertions to make an express warranty claim plausible, and the Amended
Complaint meets this standard. As to the Fifth Count, the motion to dismiss will be denied.
As to the Sixth Count, for breach of implied warranty, Jaguar contends again that
Plaintiffs failed to plead that the defect arose during the warranty period. For the reasons just
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stated, this Court rejects this argument as unsupported by the Amended Complaint. Jaguar
further argues that Block’s implied warranty claim is time-barred by New Jersey’s four-year
statute of limitations. In opposition, Plaintiffs contend that the running of the limitation period is
tolled in cases of fraudulent concealment of a cause of action, quoting Foodtown v. Sigma
Marketing Systems, Inc., 518 F. Supp. 485, 488 (D.N.J. 1980): “It is well established in New
Jersey that where there is fraudulent concealment of a cause of action the period of limitation
will not commence until discovery of wrong or of facts which reasonably put one on notice.”
Both sides find support for their arguments in the language of the New Jersey statute, part
of the Uniform Commercial Code, applicable to this claim:
Statute of limitations in contracts for sale
(1) An action for breach of any contract for sale must be commenced within four
years after the cause of action has accrued. By the original agreement the parties
may reduce the period of limitation to not less than one year but may not extend
it.
(2) A cause of action accrues when the breach occurs, regardless of the aggrieved
party’s lack of knowledge of the breach. A breach of warranty occurs when tender
of delivery is made, except that where a warranty explicitly extends to future
performance of the goods and discovery of the breach must await the time of such
performance the cause of action accrues when the breach is or should have been
discovered.
...
(4) This section does not alter the law on tolling of the statute of limitations . . .
N.J. Stat. Ann. § 12A:2-725 (italics added). Jaguar contends that subsection (2) supports their
position, while Plaintiffs say that subsection (4) supports theirs. Fortunately, the Third Circuit
has just issued a decision which offers helpful guidance about understanding the two subsections
in the identical provision in the U.C.C. of the Virgin Islands. MRL Dev. I, LLC v. Whitecap
Inv. Corp., 2016 U.S. App. LEXIS 8987 (3d Cir. May 17, 2016). In MRL, the Third Circuit
made clear that, notwithstanding the language of subsection (2), subsection (4) allows for
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equitable tolling of the limitations period. Id. at *20.
New Jersey courts recognize the doctrine of equitable tolling: “[t]ypically the doctrine is
applied where the complainant has been induced or tricked by his adversary’s misconduct into
allowing the filing deadline to pass.” Villalobos v. Fava, 342 N.J. Super. 38, 50 (N.J. Super. Ct.
App. Div. 2001). The Amended Complaint does not plead facts to make plausible the assertion
that Block was induced or tricked by Jaguar’s misconduct into allowing the filing deadline to
pass. There is no basis for equitable tolling of the four-year statute of limitations.
Absent a basis for equitable tolling, this Court applies subsection (2), which provides that
the cause of action accrued when the tender of delivery was made. The Amended Complaint
alleges that Jaguar delivered the vehicle to Block in April of 2010. (Am. Compl. ¶ 17.) Because
this is a claim for breach of an implied warranty, it cannot fall within the exception for
warranties which explicitly extend to future performance. The four-year statute of limitations
ended not later than April of 2014. The initial Complaint in this case was filed on August 3,
2015, at which time the statute of limitations had already run.
“A statute of limitations defense is an affirmative one, and in order to undergird a
dismissal, must appear on the face of the complaint.” Benak v. Alliance Capital Mgmt. L.P., 435
F.3d 396, 400 (3d Cir. 2006). Defendant’s statute of limitations defense to Block’s implied
warranty claim appears on the face of the Amended Complaint. As to the Sixth Count for
Plaintiff Block only, the motion to dismiss will be granted, and the Sixth Count will be dismissed
without prejudice.
Lastly, as to the Fourth Count, for breach of the implied warranty of good faith and fair
dealing, Jaguar contends that Plaintiffs have not sufficiently alleged an actionable
misrepresentation by Jaguar, or that Jaguar knew of the alleged defect. Furthermore, Jaguar
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argues that the Amended Complaint does not allege a sufficient basis to make a claim of unfair
dealing plausible. In Wilson v. Amerada Hess Corp., 168 N.J. 236, 251 (2001), the New Jersey
Supreme Court stated the standard for claims of breach of the implied warranty of good faith and
fair dealing:
[W]e state the test for determining whether the implied covenant of good faith and
fair dealing has been breached as follows: a party exercising its right to use
discretion in setting price under a contract breaches the duty of good faith and fair
dealing if that party exercises its discretionary authority arbitrarily, unreasonably,
or capriciously, with the objective of preventing the other party from receiving its
reasonably expected fruits under the contract. Such risks clearly would be beyond
the expectations of the parties at the formation of a contract when parties
reasonably intend their business relationship to be mutually beneficial. They do
not reasonably intend that one party would use the powers bestowed on it to
destroy unilaterally the other’s expectations without legitimate purpose.
Id. at 251. The Amended Complaint does not plead sufficient facts to make plausible a claim
that Jaguar acted with the objective of preventing Plaintiffs from receiving their reasonably
expected fruits under the contract. Nor does the Amended Complaint allege facts supporting the
inference that Jaguar unilaterally destroyed Plaintiffs’ expectations under the contract without
legitimate purpose. Jaguar’s motion to dismiss the Fourth Count will be granted.
In conclusion, as to the First, Second, Third and Fourth Counts, Jaguar’s motion to
dismiss will be granted. As to the Sixth Count, for Plaintiff Block only, the motion to dismiss
will be granted. As to the remaining claims, the motion to dismiss will be denied.
For these reasons,
IT IS on this 26th day of May, 2016
ORDERED that Defendant’s motion to dismiss the Amended Complaint (Docket Entry
No. 17) is DENIED in part and GRANTED in part; and it is further
ORDERED that Defendant’s motion to dismiss the Complaint (Docket Entry No. 9) is
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DENIED as moot; and it is further
ORDERED that, as to the First, Second, Third and Fourth Counts in the Amended
Complaint, the motion to dismiss is GRANTED, and these claims are hereby DISMISSED
without prejudice; and it is further
ORDERED that, as to the Sixth Count in the Amended Complaint for Plaintiff Block
only, the motion to dismiss is GRANTED, and the Sixth Count for Plaintiff Block only is
hereby DISMISSED without prejudice; and it is further
ORDERED that, as to the remaining claims in the Amended Complaint, the motion to
dismiss is DENIED.
s/ Stanley R. Chesler
STANLEY R. CHESLER, U.S.D.J.
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