Barragan v. General Motors LLC et al
Filing
95
ORDER GRANTING IN PART AND DENYING IN PART 70 Motion to dismiss; GRANTING IN PART AND DENYING IN PART 71 Motion to Dismiss. Signed by Judge David A. Ezra. (rg)
THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS
SAN ANTONIO DIVISION
MARIA BARRAGAN, and ANGEL
§
ALVAREZ, as next friend of A.A., JR., §
A.A, and A.A,
§
§
Plaintiffs,
§
vs.
§
§
GENERAL MOTORS LLC, U-HAUL §
INTERNATIONAL, INC., and
§
KELTON’S INC.,
§
§
Defendants.
§
No. SA-15-CV-854-DAE
ORDER: (1) GRANTING IN PART AND DENYING IN PART GENERAL
MOTORS’ MOTION TO DISMISS; AND (2) GRANTING IN PART AND
DENYING IN PART U-HAUL INTERNATIONAL’S MOTION TO DISMISS
Before the Court is a Motion to Dismiss Plaintiffs’ Third Amended
Complaint filed by Defendant General Motors LLC (“GM”) (Dkt. # 70), and a
Motion to Dismiss Plaintiffs’ Third Amended Complaint filed by Defendant UHaul International, Inc. (“U-Haul”) (Dkt. # 71). The Court held a hearing on the
motions on June 22, 2016. At the hearing, Robert P. Woodliff, Esq., represented
Plaintiffs Maria Barragan (“Barragan”) and Angel Alvarez (“Alvarez”), as next
friend to the minor children of the decedent (collectively, “Plaintiffs”); David
Prichard, Esq., and David R. Montpas, Esq., represented GM; Haley A. Cox, Esq.,
and J. Banks Sewell, III, Esq., represented U-Haul and Defendant Kelton’s Inc.
1
(“Kelton’s”). 1 After careful consideration of the supporting and opposing
memoranda and the arguments presented at the hearing, the Court, for the reasons
that follow, GRANTS IN PART AND DENIES IN PART GM’s Motion to
Dismiss (Dkt. # 70), and GRANTS IN PART AND DENIES IN PART U-Haul’s
Motion to Dismiss (Dkt. # 71).
BACKGROUND
On August 27, 2012, Isabel Barragan Mendoza (“Mendoza”) was
driving a 2004 GMC Envoy (the “vehicle”) with an attached U-Haul trailer on
Interstate 10; her brother, Juan Barragan, was a rear seat passenger. (“3d Am.
Compl.,” Dkt. # 69 ¶¶ 15–16.) According to Plaintiffs, Mendoza lost control of the
vehicle while attempting to make a lane change; the vehicle struck a guardrail and
rolled. (Id. ¶ 17.) Mendoza and her brother were both killed in the accident. (Id.)
According to Plaintiffs, Mendoza died from injuries sustained after the roof of the
vehicle crushed in upon her; her brother was ejected from the vehicle and died
from injuries sustained in the collision. (Id.)
On August 27, 2014, Plaintiffs filed suit in the 205th District Court of
Culbertson County, Texas against GM, U-Haul, and AMERCO. (Dkt. # 1-5, Ex.
A-2.) On December 22, 2014, GM, U-Haul, and AMERCO removed the action to
1
Kelton’s was served on April 11, 2016 (Dkt. # 88) and filed an answer on May
17, 2016 (Dkt. # 89). Kelton’s has not yet filed a motion to dismiss, but appeared
at the hearing.
2
this Court, invoking the Court’s diversity jurisdiction. (Dkt. # 1.) On January 13,
2015, Plaintiffs filed a Second Amended Complaint. (Dkt. # 11.) On September
29, 2015, the Court held a hearing on various motions to dismiss. (Dkt. # 64.) At
the hearing, the parties represented that Plaintiffs agreed to dismiss their claims
against AMERCO; this was memorialized in the Court’s September 30, 2015
Order. (Dkt. # 63 at 31.) After the hearing, the Court issued an order dismissing
without prejudice the following claims against GM: (1) design defect (id. at 10–
12); (2) marketing defect (id. at 12–15); and (3) breach of express warranty (id. at
20–21). The Court’s order dismissed without prejudice the following claims
against U-Haul: (1) strict liability for design defect (id. at 25–26); and (2) gross
negligence (id. at 27–28). Finally, the Court’s order dismissed with prejudice
Plaintiffs’ claim against U-Haul for breach of express warranty. (Id. at 30–31.)
The following claims against GM survived the previous motion to
dismiss: (1) manufacturing defect (Dkt. # 63 at 6–10); (2) negligence (id. at 15–
16); and (3) breach of implied warranty of merchantability (id. at 16–20). The
following claims against U-Haul survived the previous motion to dismiss: (1)
manufacturing defect (id. at 22–25); (2) negligent design defect (id. at 26–27); and
(3) breach of implied warranty of merchantability (id. at 29–30).
On January 31, 2016, Plaintiffs, filed a third amended complaint,
adding Kelton’s, the entity that rented the trailer to Mendoza, as a Defendant.
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(Third Am. Compl.) The third amended complaint re-alleges many of the claims
that survived the previous motion to dismiss; against GM, it raises claims for
(1) manufacturing defect (id. ¶¶ 38–44); (2) negligence (id. ¶¶ 56–57); and
(3) breach of implied warranty of merchantability (id. ¶¶ 58–60). The third
amended complaint also re-pleads various claims that were previously dismissed
without prejudice; against GM, Plaintiffs re-plead various design defect claims (id.
¶¶ 23–37), and various marketing defect claims (id. ¶¶ 45–55). Against U-Haul,
the Third Amended Complaint re-pleads the following claims which previously
survived the motion to dismiss: (1) negligent design defect (id. ¶ 75(A) & (G));
and (2) breach of implied warranty of merchantability (id. ¶ 76), adds an additional
claim for marketing defect (id. ¶¶ 67–74; 75(D)–(F)), and re-pleads the claim for
breach of express warranty of merchantability which was previously dismissed
with prejudice (id. ¶ 76).
On February 16, 2016, GM filed the instant Motion to Dismiss (Dkt.
# 70). On March 15, 2016, Plaintiffs filed a Response (Dkt. # 79), and GM filed a
Reply on April 5, 2016 (Dkt. # 83). U-Haul also filed the instant Motion to
Dismiss on February 16, 2016 (Dkt. # 71). Plaintiffs filed a Response, again
attaching a Fourth Amended Complaint, on March 21, 2016 (Dkt. # 82). U-Haul
filed its reply on April 5, 2016 (Dkt. # 84).
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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.” Review
is limited to the contents of the complaint and matters properly subject to judicial
notice. See Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322
(2007). In analyzing a motion to dismiss for failure to state a claim, “[t]he court
accept[s] ‘all well-pleaded facts as true, viewing them in the light most favorable
to the plaintiff.’” In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir.
2007) (quoting Martin K. Eby Constr. Co. v. Dallas Area Rapid Transit, 369 F.3d
464, 467 (5th Cir. 2004)).
To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must plead
“enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009).
ANALYSIS
I. GM’s Motion to Dismiss
GM argues that each of Plaintiffs’ twenty-one design defect claims
fail to state a claim on which relief can be granted, and should be dismissed. (Dkt.
5
# 70 at 6–10.) GM also argues that Plaintiffs have failed to state a claim for
marketing defect, because Plaintiffs’ claims for marketing defect are premised on a
failure to warn of other product defects. (Id. at 10–13.)
A. Design Defect Claims
Plaintiffs’ Third Amended Complaint alleges that GM is liable for
defective design of twenty-one elements of the 2004 GMC Envoy. 2 (Third Am.
Compl. ¶ 22, 24(a)–(c), 25(c), & 27.) GM moves to dismiss each of these design
defect claims pursuant to Rule 12(b)(6). (Dkt. # 70 at 6–10.)
To succeed on a design defect claim, a plaintiff must show that
“(1) the product was defectively designed so as to render it unreasonably
dangerous; (2) a safer alternative design existed; and (3) the defect was a
producing cause of the injury for which plaintiff seeks recovery.” Timpte Indus.,
Inc. v. Gish, 286 S.W.3d 306, 311 (Tex. 2009); Tex. Civ. Prac. & Rem. Code
2
Specifically, Plaintiffs allege that the following defective elements: (1) defective
rollover prevention; (2) unreasonably high center of gravity; (3) unreasonable
instability; (4) unreasonably unstable roof; (5) unreasonable roof crush propensity;
(6) seat buckles; (7) seat belts; (8) shoulder belts; (9) belt retractors; (10) lack of
pre-tensioner; (11) “‘A’, ‘B’, ‘C’ and ‘D’ pillars;” (12) windshield headers;
(13) roof rails; (14) glass and window system; (15) window frame design;
(16) door latches; (17) doors; (18) seats; (19) seatbacks; (20) seatback-related
systems; and (21) lack of side curtain airbags. (Third Am. Compl. ¶ 22, 24(a)–(c),
25(c), & 27.)
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§ 82.005(a). In order to successfully plead the existence of a “safer alternative
design,” a Plaintiff must allege the existence of:
a product design other than the one actually used that in reasonable
probability (1) would have prevented or significantly reduced the risk
of the claimant’s personal injury, property damage, or death without
substantially impairing the product’s utility; and (2) was economically
and technologically feasible at the time the product left the control of
the manufacturer or seller by the application of existing or reasonably
achievable scientific knowledge.
Tex. Civ. Prac. & Rem. Code § 82.005(b); Hernandez v. Tokai Corp., 2 S.W.3d
251, 256–57 (Tex. 1999). Even at the motion to dismiss stage, “a safer alternative
design is a necessary component to a design defect claim.” Rodriguez v. Gilead
Sciences, Inc., No. 2:14–CV–324, 2015 WL 236621, at *3 (S.D. Tex. Jan. 16,
2015); see Hernandez, 2 S.W.3d at 256 (“Section 82.005 reflects the trend in our
common-law jurisprudence of elevating the availability of a safer alternative
design from a factor to be considered in the risk-utility analysis to a requisite
element of a cause of action for defective design.”). “[C]onclusory allegations . . .
none of which relate to a safer alternative design,” or which only “address global
dangerousness, poor quality, or marketing issues” will not suffice. Rodriguez,
2015 WL 236621, at *3.
1. Design Defect Claims Regarding Rollover Prevention
Plaintiff alleges five design defects relating to the 2004 GMC Envoy’s
propensity to roll over: (1) defective rollover prevention; (2) unreasonably high
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center of gravity; (3) unreasonable instability; (4) unreasonably unstable roof;
(5) unreasonable roof crush propensity. (Third Am. Compl. ¶ 22.) With regard to
each of these alleged defects, Plaintiffs entirely fail to plead the existence of a safer
alternative design. (See id.); Hernandez, 2 S.W.3d at 256. Accordingly, Plaintiffs
fail to state a claim upon which relief can be granted as to each of these design
defects, and they are DISMISSED.
2. Design Defect Claims Regarding the Restraint System
Plaintiffs allege five design defects relating to the 2004 GMC Envoy’s
restraint system: (1) seat buckles; (2) seat belts; (3) shoulder belts; (4) belt
retractors; and (5) lack of pre-tensioner. (Third Am. Compl. ¶ 24(a).) Plaintiffs
state that these defects rendered the vehicle unreasonably dangerous, because the
vehicle had a “propensity to go out of control and rollover,” and the vehicle’s
restraint system was unable to “restrain an occupant” in those circumstances. (Id.
¶ 34.) While thin, Plaintiffs’ allegations sufficiently plead that the restraint system
was defectively designed, rendering it unreasonably dangerous. Accordingly,
Plaintiffs have satisfied the first element of a design defect claim.
With regards to the existence of a safer alternative design, Plaintiffs
include a laundry list of alternative designs for restraint mechanisms:
Reasonable alternative designs should include: rollover pretensioners
to eliminate dangerous amounts of belt slack in a roll; rollover sensors
to activate safety devices such as pretensioners when the vehicle
begins to roll; emergency locking retractors to prevent belt “spool
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out”; lap belt anchorage point adjustment to effectively keep a person
in the seat during rollover, buckle belt locks to prevent inertial
unlatching and integration of safety belts into the seat to transfer
energy away from the occupants; four-point safety belts; tightened Dring shoulder belt adjuster to reduce occupant movement during
rollover; cinching safety belt latch plates to reduce occupant
movement upwards; and inflatable safety belts to improve belt
performance in rollover.
(Third Am. Compl. ¶ 37.) However, Plaintiffs fail to allege that any of these
alternative designs would prevent or significantly reduce the risk of death without
substantially impairing the product’s utility. Tex. Civ. Prac. & Rem. Code
§ 82.005(b)(1). Plaintiffs similarly fail to allege that any of these alternative
designs was economically or technologically feasible at the time the product left
the control of the manufacturer, or even that these alternative designs existed at the
time of manufacture. Id. at § 82.005(b)(2). Cf. Casey v. Toyota Motor Eng’g &
Mfg. N. Am., Inc., 770 F.3d 322, 330–36 (5th Cir. 2014). Here, Plaintiffs make
only the conclusory allegations that “[r]esearch has shown for many years that
standard safety belt systems failed to effectively restrain occupant’s motion in
rollover crashes” and that “effective safety belt systems” are necessary to protect
passengers in rollover crashes. (Third Am. Compl. ¶ 35.)
The Court carefully explained the pleading standard for design defect
in its September 2015 order. (Dkt. # 63 at 10–12.) Nevertheless, Plaintiffs fail to
plead with any specificity the actual existence of a safer alternative design with
regard to the restraint system. See Hernandez, 2 S.W.3d at 256. Accordingly,
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Plaintiffs’ design defect claims with regard to effective restraint systems are
DISMISSED.
3. Design Defect Claims Regarding Crush Protection
Plaintiffs allege that the “‘A’, ‘B’, ‘C’ and ‘D’ pillars,” windshield
headers, and roof rails suffered from design defects, because each was “fabricated
without sufficient strength and structural integrity to withstand roof crushing forces
without imparting injury-producing forces upon vehicle occupants during
foreseeable accident rollovers of such vehicles.” (Third Am. Compl. ¶ 24(b).)
Construing these allegations in the light most favorable to the Plaintiff, the Court
infers that the pillars, windshield headers, and roof rails were not made of
sufficiently strong material to support the passenger compartment during a rollover
accident, and caused the vehicle to be unreasonably dangerous to the passengers in
such a scenario. Accordingly, the Plaintiffs have sufficiently pled the first element
of a design defect claim.
With regard to the existence of a safer alternative design, Plaintiffs
allege only that GM should have used “complete sections, thicker steel and
stronger materials” when designing the crush-protective elements of the car.
(Third Am. Compl. ¶ 33.) Plaintiffs state that these improvements were
“mechanically feasible, posed no adverse consequences to consumer and [were]
only marginally more expensive to implement,” and that these improvements
10
would allow the vehicle to “withstand rollover impact forces . . . in excess of 8,000
Newtons and thus would prevent death in most actual rollover accident cases.”
(Id.)
However, while Plaintiffs allege that this design alternative would
reduce the risk of crush-related deaths in a rollover accident, they fail to plead the
existence of a “safer alternative design” in accordance with the Texas Civil
Practice and Remedies Code. See Tex. Civ. Prac. & Rem. Code § 82.005(b)(1).
While Plaintiffs allege that GM should have used stronger materials in the roof,
they do not plead that the use of stronger materials would have reduced the risk of
the injury “without substantially impairing the product’s utility,” nor do they allege
that the use of stronger materials was economically and technologically feasible at
the time the product left GM’s control. Id.; (Dkt. # 63 at 10–12.) Rather, they
make the conclusory allegation that the alternative was “mechanically feasible”
and only “marginally more expensive to implement.”3 These allegations, over 18
months into the litigation are insufficient for the Court to infer that an
3
Plaintiffs do not allege that the vehicle, as designed, did not meet certain
standards for crush protection, nor do they allege that the vehicle as designed could
not withstand a crush force of 8,000 Newtons. Rather, they state that GM has
known since 1968 that these elements “must be manufactured and fabricated to
withstand rollover crushing forces of at least 8,000 Newtons,” and that “the crush
impact forces sustained in real world accidents” were greater than the forces the
vehicle could sustain. (Third Am. Compl. ¶¶ 31–32.)
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economically feasible alternative design existed at the time of the vehicle’s
manufacture. Id. § 82.005(b)(2).
Accordingly, Plaintiffs have failed to plead the existence of a safer
alternative design with regard to the crush protection system, and fail to state a
claim upon which relief can be granted. Plaintiffs’ design defect claims with
regard to effective crush protection systems are DISMISSED.
4. Design Defect Claims Regarding Ejection Protection
Plaintiffs allege that the vehicle’s glass and window system and
window frame design (the “window system”) suffered from design defects. (Third
Am. Compl. ¶ 24(c).) Plaintiffs state that the window system in the vehicle did not
comply with Federal Motor Vehicle Safety Standard 205, did not mitigate injuries
resulting from impact to the windows, and failed to prevent occupants from being
thrown through the vehicle windows in a collision. (Id.) Plaintiffs state these
failures rendered the vehicle unreasonably dangerous, and that Juan Barragan may
have been thrown through the vehicle’s window during the crash. At this stage,
this allegation is sufficient to allege that the window system was defectively
designed, and that this defect rendered the design unreasonably dangerous.
Plaintiffs state that the National Highway Traffic Safety
Administration (“NHTSA”) published a report in August 2001 presenting four
prototype window systems, each of which improved occupant retention “by
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reducing ejections through side windows in rollover crashes.”4 (Dkt. # 69 ¶ 30.)
According to the Third Amended Complaint, implementing one of the four
prototypes increased production costs between forty-eight and seventy-eight
dollars per vehicle. (Id.) Construing the complaint in the light most favorable to
the Plaintiff, this proposed alternative design could have reduced the risk of
Plaintiffs’ injuries, and may have been economically and technologically feasible
at the time the vehicle was manufactured. Tex. Civ. Pract. & Rem. Code
§ 85.002(a). Accordingly, Plaintiffs allege sufficient information regarding the
window system to plausibly state a safer alternative design existed at the time the
vehicle was manufactured. The second factor of the defective design test is
accordingly satisfied. See Gish, 286, S.W.3d at 311.
Finally, the Court infers from the Third Amended Complaint that the
alleged defect could have been a producing cause of the injury for which Plaintiff
seeks recovery. Gish, 286 S.W.3d at 311. Plaintiffs allege that Juan Barragan was
4
Plaintiffs filed a 1995 Status Report published by the NHTSA entitled “Ejection
Mitigation Using Advanced Glazing” as an exhibit to their Response. (Dkt. # 79,
Ex. 2.) Defendants object to Plaintiffs’ inclusion of the 1995 Status Report rather
than the official 2001 report. (Dkt. # 83 at 4.) While this discrepancy is
inexplicable, the Court has reviewed the 1995 report and finds that it presents a
design involving both the material makeup of the window and the frame in which
it is enclosed, and that the design purports to reduce the frequency with which
passengers are ejected from windows in car accidents. (See Dkt. # 79, Ex. 2.)
While this design may not ultimately be sufficient to support a design defect claim,
it presents sufficient information regarding the existence of an alternative design to
survive the motion to dismiss stage.
13
thrown from the vehicle during the accident and subsequently died; while he may
have been ejected through the door, it is possible that he was ejected through the
window. At this stage, Plaintiffs have sufficiently pled that the defect was a
producing cause of their injury. See id. Accordingly, Plaintiffs have stated
sufficient facts to allege that the window system suffered from a design defect.
GM’s Motion to Dismiss this design defect is DENIED.
5. Design Defect Claims Regarding Ejection Protection from Doors
Plaintiffs allege that both the door, and door latch system, suffered
from a design defect. (Third Am. Compl. ¶ 24(c).) Plaintiffs state that the door
latch system was defective and allowed occupants to be ejected during a rollover.
(Id.) The Court infers that the Plaintiffs allege the vehicles doors and door latches
were defectively designed, causing the doors to open upon impact, and causing the
vehicle to be unreasonably dangerous to passengers who could be ejected from the
vehicle. Plaintiffs have sufficiently pled the first element of a design defect claim.
Gish, 286 S.W.3d at 311.
With regards to the second element Plaintiffs must plead to state a
design defect claim, Plaintiffs assert that GM was aware of the possibility of door
latch failure, and had “knowledge and technology to strengthen the overall
occupant retention system” at minimal cost. (Third Am. Compl. ¶ 24(c). This is
exceedingly broad, and does not plead with any degree of specificity the existence
14
of a safer alternative design with regard to the doors or door latches. Plaintiffs fail
to state a design defect claim with regard to the doors or door latches, and these
claims are DISMISSED.
6. Design Defect Claims Regarding Seating
Plaintiffs allege that the seats, seatbacks, and seatback-related systems
suffered from design defects, and the lack of side curtain airbags amounted to a
design defect. (Third Am. Compl. ¶ 27.) Plaintiffs do not allege the existence of a
specific defect with regard to any of these elements, but only state that these
defects prevented the car from providing adequate protection to the driver and
contributed to the ejection of the passenger. (Id.) Even assuming that the
Plaintiffs sufficiently pled any defect with regards to the seats and airbags, they do
not allege the existence of a safer alternative design. Gish, 286 S.W.3d at 311.
Rather, they merely state that “alternative designs to correct dangerous propensities
of the GMC Envoy were known to Defendant for many years. Defendant
intentionally chose profits over safety.” (Id. ¶ 28.) Plaintiffs wholly fail to state a
claim upon which relief can be granted with regard to the design defect claims for
seats, seatbacks, seatback-related systems, and the lack of side curtain airbags.
Accordingly, these claims are DISMISSED.
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B. Marketing Defect Claims
Plaintiffs’ Third Amended Complaint alleges that the vehicle suffered
from various marketing defects. (Third Am. Compl. ¶¶ 46–55.)
“[A] manufacturer has a duty to warn if it knows or should know of
the potential harm to a user because of the nature of its product.” Am. Tobacco
Co., Inc. v. Grinnell, 951 S.W.2d 420, 426 (Tex. 1997). A product may be
unreasonably dangerous if a manufacturer fails “to provide adequate warnings or
instructions on the product’s use,” and the “lack of adequate warnings or
instructions renders an otherwise adequate project unreasonably dangerous.”
McLennan v. Am. Eurocopter Corp., Inc., 245 F.3d 403, 426–27 (5th Cir. 2001)
(quoting Coleman v. Cintas Sales Corp., 40 S.W.3d 433, 549–50 (Tex. App.
2001)). A plaintiff seeking to bring a marketing defect claim must allege the
following elements:
(1) a risk of harm is inherent in the product or may arise from the
intended or reasonably anticipated use of the product, (2) the product
supplier actually knew or should have reasonably foreseen the risk of
harm at the time the product was marketed, (3) the product possessed
a marketing defect, (4) the absence of the warning or instructions
rendered the product unreasonably dangerous to the ultimate user or
consumer of the product, and (5) the failure to warn or instruct
constituted a causative nexus in the product user’s injury.
DeGrate v. Executive Imprints, Inc., 261 S.W.3d 402, 411 (Tex. App. 2008).
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1. General Marketing Defect Claims
Plaintiffs’ Third Amended Complaint alleges that GM is liable for
marketing defects for failure to warn consumers about:
Defective rollover prevention, unreasonably high center of gravity,
unreasonable instability, unreasonably instable roof and roof crush
propensity, defective restraint and supplemental restraint systems,
including air bags and safety belts, defective seats and seatbacks,
defective doors and door latches, which allowed doors to open during
the rollover and an overall occupant retention system, which included
a failure to utilize an occupant retention window system[ ] in the side
and rear windows of the subject vehicle . . .
(Third Am. Compl. ¶ 46.) These claims are nearly identical to those marketing
defect claims which the court previously dismissed. (See Dkt. # 11 ¶¶ 52, 54; Dkt.
# 63 at 13–15.) As previously explained, a marketing defect arises where the
actual failure to warn causes a product to be unreasonably dangerous; a marketing
defect does not arise where manufacturer fails to warn of the unreasonable danger
caused by alleged design defects. See Ethicon Endo-Surgery, Inc. v. Meyer, 249
S.W.3d 513 (Tex. App. 2007); Timoschuk v. Daimler Trucks N. Am., LLC, No.
SA–12–CV–816–XR, 2014 WL 2592254, at *3 (W.D. Tex. June 10, 2014).
Here, despite the Court’s previous explanation of the essential
elements of a marketing defect claim, Plaintiffs continue to attempt to bring a
cause of action for marketing defect based upon GM’s failure to warn of alleged
design defects. This is insufficient to state a cause of action, and these claims are
DISMISSED.
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2. Marketing Defect Claim Regarding Towing
Plaintiffs also assert a marketing defect claim against GM for failure
to “warn prospective users of the increased danger of rollover in the use of towing
equipment.” (Third Am. Compl. ¶ 49.) Plaintiffs allege that the vehicle had a
“high center of gravity, causing a rollover propensity . . . when towing a large
cargo trailer,” and that GM was aware of “rollovers involving the use of towing
equipment,” but that it nonetheless failed to include a specific warning in the
“instruction manual with regard to towing.” (Id. ¶ 48–49.)
Based upon Plaintiffs’ allegations, it is possible to infer (1) using the
vehicle to tow a trailer presents a risk of harm – specifically the risk of a rollover
collision – due to the vehicle’s high center of gravity; (2) GM should have
anticipated that vehicle users may attempt to tow cargo trailers; (3) that GM failed
to provide an adequate warning regarding the use of cargo trailers with the vehicle
when it marketed the vehicle; (4) that the absence of the warning rendered the
vehicle unreasonably dangerous, because drivers such as Mendoza would not have
towed a similar cargo trailer had they been aware of the risk; and (5) this failure to
warn was a cause of Plaintiffs’ damages – if GM had properly warned Mendoza of
the allegedly increased risk of rollover associated with towing a cargo trailer,
Mendoza would not have used the vehicle to tow a trailer, and would not have had
the accident. At this stage, Plaintiffs have pled sufficient information to state a
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claim for marketing defect with regards to GM’s alleged failure to warn about
increased risks associated with using the vehicle to tow cargo trailers.
Accordingly, GM’s motion to dismiss is DENIED only as to this specific
marketing defect claim.
II. U-Haul’s Motion to Dismiss
U-Haul argues that Plaintiffs’ claim for breach of express warranty
must be dismissed, because this Court previously dismissed the claim with
prejudice.5 (Dkt. # 71 at 4–5.) Further, they argue that Plaintiffs’ have failed to
state a marketing defect claim. (Dkt. # 71 at 5–7.) Finally, U-Haul argues that
Plaintiffs’ claim for breach of implied warranty of merchantability should be
dismissed, though it previously survived a motion to dismiss, because Plaintiffs
have added Kelton’s—the business which allegedly rented the trailer to
Mendoza—as a defendant in the case. (Dkt. # 71 at 7–8.)
A. Marketing Defect Claims
Plaintiffs’ Third Amended Complaint alleges that U-Haul is liable for
a marketing defect for failure to warn potential users of the alleged danger of
5
Plaintiffs’ response states that they “did not even intend to plead in their Third
Amended Complaint; to the extent that Plaintiffs inadvertently pled a claim for
breach of express warranty in their Third Amended Complaint, such claim is
hereby withdrawn.” (Dkt. # 81 at 5–6.) While Plaintiffs’ counsel states the claim
was “inadvertent,” this inadvertence has cost the Court, counsel for U-Haul, and
even Plaintiffs’ own counsel unnecessary time and resources.
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towing a trailer whose weight is approximately equal to the weight of the towing
vehicle.6 (Third Am. Compl. ¶¶ 67–74). Defendants argue that this claim should
be dismissed, because the claim also appears to allege marketing defects for failure
to warn regarding the trailer’s alleged design defects. (Dkt. # 71 at 5–7.)
Plaintiffs state that (1) an increased rollover risk is associated with
towing a 12-foot trailer using an SUV-type vehicle, where the trailer and vehicle
have an approximate 1:1 weight ratio (3d Am. Compl. ¶ 70, 72); (2) U-Haul should
have reasonably anticipated that risks associated with towing this type of trailervehicle combination (id. ¶ 70); (3) U-Haul did not give adequate warning regarding
the vehicle-trailer combination (id. ¶ 68, 73); (4) this warning caused the trailervehicle combination to be unreasonably dangerous to Mendoza, who may not have
been aware of the rollover risks associated with the trailer-vehicle combination
(id. ¶ 71, 74); and (5) this alleged failure to warn may have contributed to the
accident, by allegedly causing Mendoza to rent an inappropriate trailer for her
vehicle (id. ¶ 74).
Plaintiffs’ Third Amended Complaint states a claim for marketing
defect insofar as the alleged failure to warn regarding certain vehicle-trailer
6
While this is somewhat less clear in the Third Amended Complaint, Plaintiffs’
response clarifies that “the U-Haul trailer at issue is much safer to tow behind a
box truck or other vehicle with a 2:1 or greater ratio of the towing vehicle’s weight
to the trailer’s weight than it is to tow behind a GMC Envoy with an approximately
1:1 ratio of the GMC Envoy’s weight to the trailer’s weight.” (Dkt. # 81 at 11–12.)
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combinations was unnecessarily dangerous. U-Haul’s motion to dismiss is
DENIED as to this claim. To the extent Plaintiffs also attempt to state a marketing
defect claim regarding U-Haul’s failure to warn about design defects, these claims
are DISMISSED.
B. Breach of Implied Warranty of Merchantability
While Plaintiffs’ claim for breach of implied warranty of
merchantability previously survived U-Haul’s motion to dismiss (Dkt. # 63 at 29–
30), U-Haul argues that the claim should now be dismissed. (Dkt. # 71 at 7–8;
Dkt. # 84 at 3–5.) U-Haul argues that Plaintiffs’ Third Amended Complaint fails
to state a claim against it for breach of implied warranty of merchantability,
because the complaint alleges that Kelton’s, rather than U-Haul, rented the trailer
(id. at 7–8). 7
7
U-Haul also appears to argue that the implied warranty of merchantability in a
lease transaction is fully governed by § 2A.212 of the Texas Business and
Commerce Code, rather than § 2.314 (Dkt. # 71 at 7, n. 2), precluding Plaintiff
from asserting a claim for breach of implied warranty of merchantability here. UHaul is correct that in most circumstances, a lease contract carries an implied
warranty of merchantability. See Tex. Bus. & Comm. Code § 2A.212(a) (“Except
in a finance lease, a warranty that the goods will be merchantable is implied in a
lease contract if the lessor is a merchant with respect to goods of that kind.”).
However, U-Haul interprets the statute too narrowly; § 2A.212(a) does not
preclude Plaintiffs from stating a claim for breach of implied warranty of
merchantability here, where a lease transaction occurred. See Oldham v.
Thompson/Ctr. Arms. Co., Inc., No. H–12–2432, 2013 WL 1576340, at *8 (S.D.
Tex. Apr. 11, 2013) (citing Polaris Indus. v. McDonald, 119 S.W.3d 331, 336
(Tex. App. 2003)). Texas courts apply the same pleading standard for breach of
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A plaintiff successfully states a cause of action for breach of implied
warranty of merchantability by alleging: “1) the defendant sold or leased a product
to the plaintiff; 2) the product was unmerchantable; 3) the plaintiff notified the
defendant of the breach; and 4) the plaintiff suffered injury.” Equistar Chem., L.P.
v. Dresser-Rand Co., 240 S.W.3d 864, 867 (Tex. 2007) (emphasis added) (quoting
Polaris Indus. v. McDonald, 119 S.W.3d 331, 336 (Tex. App. 2003)). While
Plaintiffs do assert that the trailer was rented from Kelton’s, they also assert that
Kelton’s is a franchise dealer for U-Haul. (3d Am. Compl. ¶ 61.) Whether
liability for a potential breach of implied warranty of merchantability falls upon UHaul or Kelton’s is an issue of agency; at the motion to dismiss stage, Plaintiffs
need not have determined the party upon whom liability ultimately falls. See
O’Bryant v. Century 21 S. Cent. States, Inc., 899 S.W.2d 270, 271–72 (Tex. App.
1995). Accordingly, there is no need to reconsider the prior order regarding the
motion to dismiss, and U-Haul’s Motion to Dismiss this claim is DENIED (Dkt.
# 71.)
CONCLUSION
Plaintiffs attached a proposed Fourth Amended Complaint to each
Response to the Motions to Dismiss. (Dkt. # 79, Ex. 1; Dkt. # 81, Ex. 1.) As the
Court explained during the September 29, 2015 hearing on the previous motions to
implied warranty of merchantability to both lease and purchase transactions. See
Helen of Troy, L.P. v. Zotos Corp., 511 F. Supp. 2d 703, 724 (W.D. Tex. 2006).
22
dismiss, additional leave to amend the complaint will not be granted. (Dkt. # 70–1
at 26 (“I’m putting you on clear and unmistakable notice that there is going to be
no fourth amended complaint here . . . there comes a point where the Court has to
say, enough is enough”).); see Matter of Southmark Corp., 88 F.3d 311, 314–15
(5th Cir. 1996) (“In deciding whether to grant [leave to amend], the court may
consider such factors as 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, and futility of amendment.”); see also U.S.
ex rel. Willard v. Humana Health Plan of Tex. Inc., 336 F.3d 375, 387 (5th Cir.
2003).
The Court provided Plaintiffs a very clear outline of the applicable
law in its previous order on the parties’ motions to dismiss. At this point, any
failures to properly plead a claim amount to repeated failure to cure deficiencies.
See Matter of Southmark, 88 F.3d at 314–15. These deficient claims, which
Plaintiffs have had the opportunity to properly plead, are appropriately dismissed
with prejudice at this stage. See Yumilicious Franchise, L.L.C. v. Barrie, 819 F.3d
170, 177 (5th Cir. 2016) (affirming dismissal of counterclaims with prejudice when
counterclaimant waited fifteen months to remedy the deficiencies in its pleadings);
Hermann Holdings Ltd. v. Lucent Tech. Inc., 302 F.3d 552, 566 (5th Cir. 2002)
23
(finding plaintiffs need not be afforded a further opportunity to amend their
complaint where they had been given two opportunities to amend).
Accordingly, the Court DISMISSES the following claims against GM
WITH PREJUDICE: (1) design defect claims regarding rollover protection, the
restraint system, crush protection, ejection protection from doors, and seating; and
(2) general marketing defect claims. The Court DISMISSES the following claims
against U-Haul WITH PREJUDICE: (1) general marketing defect claims; and
(2) claim for breach of express warranty of merchantability, insofar as it was
alleged.
Against GM, Plaintiffs’ design defect claims regarding the window
system and marketing defect claim regarding towing remain; against U-Haul,
Plaintiffs’ marketing defect claim regarding vehicle-trailer combinations, as well
as the claim for breach of implied warranty of merchantability remain.
For the reasons stated above, GM’s Motion to Dismiss is GRANTED
IN PART AND DENIED IN PART (Dkt. # 70). U-Haul’s Motion to Dismiss is
GRANTED IN PART AND DENIED IN PART (Dkt. # 71.)
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IT IS SO ORDERED.
DATED: San Antonio, Texas, June 22, 2016.
_____________________________________
David Alan Ezra
Senior United States Distict Judge
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