Zaccagnino v. Nissan North America, Inc.

Filing 37

OPINION AND ORDER. Nissan's motion to dismiss (Dkt. No. 23) is granted in part and denied in part. Zaccagnino has standing to sue and has stated a claim for deceptive business practices (Count I of the amended complaint). The false advertising a nd warranty claims (Counts II through V) are dismissed for failure to state a claim. So ordered. re: 23 MOTION to Dismiss Plaintiff's Amended Class Action Complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) filed by Nissan North America, Inc. (Signed by Judge Louis L. Stanton on 6/16/2015) (rjm)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
ANDREW ZACCAGNINO, on behalf of
himself and all other similarly
situated,

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DOC#:

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DAn: FILED:

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(o I /7//.._)
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Plaintiff,
14 Civ. 3690 (LLS)
- against OPINION & ORDER
NISSAN NORTH AMERICA, INC.,
Defendant.
Plaintiff Andrew Zaccagnino brought this putative class
action against defendant Nissan North America, Inc.

( "Nissan")

for deceptive business practices, false advertising, and breach
of express and implied warranties. Nissan moves to dismiss the
amended class action complaint ("complaint") for lack of
standing and failure to state a claim. For the reasons that
follow, Nissan's motion is granted in part and denied in part.
Zaccagnino has standing to sue and has stated a claim for
deceptive business practices. The false advertising and warranty
claims are dismissed for failure to state a claim.
BACKGROUND
Nissan manufactures and sells Nissan and Infiniti vehicles
in the United States.
"Since at least 2012, Nissan was aware of numerous customer
complaints, warranty claims and other data that demonstrated
that the OCS in the Nissan Vehicles was defective." Am. Class

Action Compl.

("Compl.")

~

3, Dkt. No. 21. The OCS, which stands

for occupant classification system, is a system of sensors that
"detect when children sit in the front passenger seat and either
deactivate the air bag or deploy the air bag with less force."
Id.

~

20. If the OCS malfunctions, the passenger airbag may

improperly deploy when a child is sitting in the passenger seat
or fail to deploy despite the presence of an adult passenger. A
dashboard light indicates when the OCS has deactivated the
airbag because of a child passenger.
"Nissan attempted to conduct a limited recall of less than
83,000 vehicles in February 2013. It quickly became clear that
the limited recall did not fix the defect and the consumer
complaints and warranty claims continued throughout 2013." Id.
~

3.

In August 2013, Zaccagnino bought a 2013 Nissan Altima
from a Nissan dealership. The car was not subject to the
February 2013 recall.
Plaintiff saw advertisements for Nissan vehicles on
television, in magazines, on billboards, in brochures
and on the internet before he purchased his Altima.
Before he purchased the 2013 Altima, he recalls that
safety and quality were consistent themes across the
advertisements he saw. These representations about
safety and quality influenced Plaintiffs decision to
purchase the 2013 Altima.
Id.

~

15.
In March 2014, Nissan expanded the recall to almost one

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million cars, including Zaccagnino's Altima. He learned of the
recall in April 2014 and had his car inspected. "While the
vehicle was in the garage being inspected, Plaintiff and a
mechanic observed that the passenger 'air-bag' light indicated
that the air bag was in the 'off' position even though an adult
male was sitting in the front passenger seat." Id.

~

76. He then

took his car to the Nissan dealership, which performed the
recall repair.
However, because of "numerous reports that the March 2014
Recall did not adequately repair the OCS Defect," Zaccagnino
"has no confidence that the defect in his vehicle has been
repaired." Id.

CJI

78.

Zaccagnino claims that Nissan was aware the 2013 recall had
not solved the OCS defect and the defect was present in many
vehicles that were not covered by the 2013 recall. He states
that if he had known about the OCS defect he would have paid
less for his car. Accordingly, he claims that Nissan engaged in
deceptive business practices and false advertising by not
disclosing that his car might be defective and continuing to
advertise it as a safe, quality vehicle.
Zaccagnino also claims that Nissan breached the express and
implied warranties by selling him a car with a defective OCS and
failing to repair it.

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DISCUSSION
Nissan moves to dismiss the complaint for lack of standing
and failure to state a claim. See Fed. R. Civ. P. 12 (b) (1),

(6).

I. STANDING
Zaccagnino alleges that he paid more for his car than he
would have if Nissan had disclosed the OCS defect and that
Nissan failed to repair the car in accordance with the
warranties, leaving him with a car diminished in value. Among
other relief, he seeks an award of damages to compensate for
those economic injuries. That is sufficient to demonstrate
standing.
Accordingly, the motion to dismiss for lack of standing is
denied.

II. FAILURE TO STATE A CLAIM
"To survive a motion to dismiss, 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, 129 S. Ct. 1937, 1949 (2009)

(quoting Bell

Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 1974
(2007)).
A. Deceptive Business Practices

Section 349 of the New York General Business Law prohibits
"[d]eceptive acts or practices in the conduct of any business,
trade or commerce or in the furnishing of any service in this

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state."
There are three elements to a section 349 claim: "first,
that the challenged act or practice was consumer-oriented;
second, that it was misleading in a material way; and third,
that the plaintiff suffered injury as a result of the deceptive
act." Stutman v. Chern. Bank, 95 N.Y.2d 24, 29, 709 N.Y.S.2d 892,
895

(2000)

(citations omitted).

Nissan argues that its actions were not materially
misleading and that Zaccagnino suffered no injury.
l. Materially Misleading
An act or practice is materially misleading if is it
"likely to mislead a reasonable consumer acting reasonably under
the circumstances." Oswego Laborers' Local 214 Pension Fund v.
Marine Midland Bank, N.A.,

85 N.Y.2d 20, 26, 623 N.Y.S.2d 529,

533 (1995).
Here, Zaccagnino alleges that when he bought his car
Nissan was aware, but did not reveal to him, that the 2013
recall had not solved the OCS defect and the defect was present
in many vehicles not subject to that recall. That is sufficient
to plead that those omissions were materially misleading. See In
re Porsche Cars N. Am., Inc., 880 F. Supp. 2d 801, 860-62
Ohio 2012)

(S.D.

(car manufacture's failure to disclose coolant tube

defect was materially misleading under § 349); Doll v. Ford
Motor Co., 814 F. Supp. 2d 526, 550 (D. Md. 2011)

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(alleging

"Ford misled consumers by withholding material information
regarding the defective torque converter, and, as a result,
consumers were harmed by high repair and replacement costs" is
sufficient to state a§ 349 claim); Szymczak v. Nissan N. Am.,
Inc., No. 10 Civ. 7493 (VB), 2011 WL 7095432, at *16 (S.D.N.Y.
Dec. 16, 2011)

("Plaintiffs Szymczak, Lopez, Greathouse, and

Jackson can also maintain a cause of action under Section 349
for defendants' failure to disclose a defect when such failure
was likely to mislead a reasonable consumer.").
2. Injury
Zaccagnino states that "[h]ad Nissan disclosed the OCS
defect, Plaintiff would not have purchased the 2013 Altima or
would he would [sic] have paid less than he did." Compl.

<]{

15. A

claim that "the price of the product was inflated as a result of
the defendant's deception" is sufficient to allege injury.
Goldemberg v. Johnson & Johnson Consumer Cos., 8 F. Supp. 3d
467, 481 (S.D.N.Y. 2014)

(brackets omitted); accord. Ackerman v.

Coca-Cola Co., No. 09 Civ. 395 (JG), 2010 WL 2925955, at *23
(E.D.N.Y. July 21, 2010)

("Injury is adequately alleged under

GBL §§ 349 or 350 by a claim that a plaintiff paid a premium for
a product based on defendants' inaccurate representations.").
I reject the argument that Zaccagnino suffered no injury
because he "bargained for a vehicle that would be repaired if
defective and his allegations demonstrate that he has received

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the full value of this bargain." Reply Brief at 7, Dkt. No. 31.
It is plausible that, despite the express warranty,

Zaccagnino

would have paid less for the car if Nissan had disclosed the OCS
defect. See In re Porsche Cars N. Am., Inc., 880 F. Supp. 2d at
860-61 (complying with an express warranty does not foreclose a
§

349 claim); Doll, 814 F. Supp. 2d at 546 (same).
Accordingly, Zaccagnino has stated a claim for deceptive

business practices.

B. False advertising
New York General Business Law section 350 prohibits
"[f]alse advertising in the conduct of any business, trade or
commerce or in the furnishing of any service in this state."
A claim for false advertising has four elements:
advertisement was consumer-oriented,
materially misleading,

(1) the

(2) the advertisement was

(3) the plaintiff relied on the

advertising, and (4) the plaintiff was injured as a result of
the advertisement. Leider v. Ralfe, 387 F. Supp. 2d 283, 292
(S.D.N.Y. 2005).
The reliance requirement "means that the plaintiff must
'point to [a] specific advertisement or public pronouncement'
upon which he or she relied." Id.

(alteration in Leider)

(quoting Small v. Lorillard Tobacco Co., 252 A.D.2d 1, 9, 679
N.Y.S.2d 593, 600 (1998), aff'd,

94 N.Y.2d 43, 698 N.Y.S.2d 615

(1999)); accord Szymczak, 2011 WL 7095432, at *15 (dismissing a

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§

350 claim because "Plaintiffs do not identify any false or

misleading advertisement or plead any reliance on any such
advertisement").
Here, the only allegation of reliance states:
Plaintiff saw advertisements for Nissan vehicles on
television, in magazines, on billboards, in brochures
and on the internet before he purchased his Altima.
Before he purchased the 2013 Altima, he recalls that
safety and quality were consistent themes across the
advertisements he saw. These representations about
safety and quality influenced Plaintiffs decision to
purchase the 2013 Altima.
Compl.

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15. Accordingly, consideration of the section 350 claim

is limited to those themes of quality and safety that Zaccagnino
allegedly relied on.
Nissan argues that general themes of safety and quality are
not misleading as a matter of law because they are mere puffery.
Statements and practices that are mere puffery are not
actionable. Puffery includes generalized or
exaggerated statements which a reasonable consumer
would not interpret as a factual claim upon which he
could rely. Regarding puffery, the Second Circuit has
stated that "[s]ubjective claims about products, which
cannot be proven either true or false, are not
actionable."
Fink v. Time Warner Cable, 810 F. Supp. 2d 633, 644
2011)

(citations omitted)

464, 474

(S.D.N.Y.

(quoting Lipton v. Nature Co., 71 F.3d

(2d Cir. 1995)). For example, describing internet

service as "blazing fast," "fastest, easiest," "High Speed
Internet," or "Faster Internet" is puffery. See Serrano v.

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Cablevision Sys. Corp., 863 F. Supp. 2d 157, 167-68

(E.D.N.Y.

2012); Fink, 810 F. Supp. 2d at 644.
Like speed and. ease for internet service, safety and
reliability are desirable qualities for a car. However,
promoting a car as generally safe and reliable is too general a
representation to be proven true or false.

It is puffery and

cannot be materially misleading under section 350.
Accordingly, the false advertising claim is dismissed.
C. Breach of Express Warranty

Zaccagnino alleges Nissan breached its express warranty by
failing to repair his car. Nissan states it repaired his car and
the post-repair behavior detailed in the complaint describes a
properly functioning OCS.
Zaccagnino states he has "no confidence" his car was fixed:
However, as discussed in detail below, there have been
numerous reports that the March 2014 Recall did not
adequately repair the OCS Defect. As a result,
Plaintiff has no confidence that the defect in his
vehicle has been repaired. In fact, since taking his
Altima in for the recall repair, Plaintiff has noticed
that the passenger air bag light goes off (indicating
the air bag is "on") even when there is no passenger
seated in the front seat.
Compl.

~

78.

At issue is whether the car in fact was repaired.
Zaccagnino's confidence in his car, as influenced by complaints
about other vehicles, is immaterial. The 2013 Altima Owner's

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Manual reveals that the post-repair behavior described in the
complaint is how the status light is supposed to work: "The
light operates as follows: Unoccupied passenger's seat: The [air
bag status light] is OFF and the front passenger air bag is OFF
and will not inflate in a crash." Connelly Decl. Ex. A, at 2013
Altima Sedan Owner's Manual 1-47, Dkt. No. 25. 1
Accordingly, the item's repair and performance conform to
the warranty and the express warranty claim is dismissed for
failure to state a claim.
D. Breach of Imp1ied Warranty

The implied warranty claim also fails because the complaint
indicates the repair was successful.
The implied warranty of merchantability requires that goods
"are fit for the ordinary purposes for which such goods are
used." N.Y. U.C.C. Law§ 2-314(2) (c).
Under New York law, "at a bare minimum the ordinary
purpose for which a used car is to be used should be
such as to enable the purchaser to transport herself
upon the streets and highways of this state or any
other in a reasonably safe manner." Rather than
guaranteeing performance without malfunction during
the term of the warranty, a warranty anticipates that
1 The warranty information booklet and the owner's manual were not attached to
the complaint or referenced in it. Nevertheless, I may consider them in
deciding this motion without converting it to a motion for summary judgment
because the warranty booklet is integral to the express warranty claim and it
incorporates the owner's manual by reference. See Holowecki v. Fed. Exp.
Corp., 440 F.3d 558, 565-66 (2d Cir. 2006), aff'd, 552 U.S. 389, 128 S. Ct.
1147 (2008).

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failures will occur and that they will be corrected.
Diaz v. Paragon Motors of Woodside, Inc., 424 F. Supp. 2d 519,
541 (E.D.N.Y. 2006)

(quoting McCormack v. Lynn Imports, Inc.,

114 Misc. 2d 905, 910-11, 452 N.Y.S.2d 821, 824

(Dist. Ct.

1982)).
The complaint indicates that the recall corrected the OCS
defect and that, following the recall repair, the car could
transport Zaccagnino "in a reasonably safe manner."
Accordingly, the implied warranty claim is dismissed for
failure to state a claim.
E. Magnuson-Moss Warranty Act

The Magnusson-Moss Warranty Act ("MMWA") allows a consumer
to sue a warrantor for breach of a written or implied warranty.
15 U.S.C. § 2310(d). "The MMWA, however, creates no additional
bases for liability, but allows a consumer to recover damages
under existing state law, and attorneys fees." Diaz v. Paragon
Motors of Woodside, Inc., 424 F. Supp. 2d 519, 540 (E.D.N.Y.
2006)

(citing Walsh v. Ford Motor Co., 807 F.2d 1000, 1012 (D.C.

Cir. 1986)).
Since the express and implied warranty claims are dismissed
for failure to state a claim, the MMWA claim must also be
dismissed.
CONCLUSION

Nissan's motion to dismiss (Dkt. No. 23) is granted in part

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and denied in part. Zaccagnino has standing to sue and has
stated a claim for deceptive business practices (Count I of the
amended complaint). The false advertising and warranty claims
(Counts II through V) are dismissed for failure to state a
claim.
So ordered.
Dated:

New York, New York
June 16, 2015

LOUIS L. STANTON
U.S.D.J.

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