Murphy et al v. Setzer's Camping World of Camping, Inc. et al
Filing
45
MEMORANDUM OPINION AND ORDER rejecting in part and adopting in part the 40 Proposed Findings and recommendations by Magistrate Judge Eifert; denying Keystone's 17 MOTION to Dismiss and Plaintiffs' 24 MOTION to Amend or Remand; grantin g Defendant Setzer's 12 MOTION for Partial Dismissal and dismissing the claims listed herein; the remaining claims are referred back to the Magistrate Judge for pretrial management and submission of proposed findings of fact and recommendations consistent with this Court's 6/16/2020 7 Standing Order. Signed by Judge Robert C. Chambers on 1/29/2021. (cc: counsel of record; any unrepresented parties) (jsa)
IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF WEST VIRGINIA
HUNTINGTON DIVISION
KARLA MURPHY, et al.,
Plaintiffs,
v.
CIVIL ACTION NO. 3:20-0406
SETZER’S WORLD OF CAMPING, INC., et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
This action was referred to the Honorable Cheryl A. Eifert, United States Magistrate
Judge, for submission to this Court of proposed findings of fact and recommendation, pursuant to
28 U.S.C. § 636(b)(1)(B). The Magistrate Judge has submitted her Proposed Findings and
Recommendations (“PF&R”) (ECF No. 40), and Plaintiffs timely filed their objections (ECF No.
41). Consistent with this Opinion, the PF&R (ECF No. 40) is REJECTED IN PART and
ADOPTED IN PART. The Court DENIES Keystone’s Motion to Dismiss (ECF No. 17),
DENIES Plaintiffs’ Motion to Amend or Remand (ECF No. 24), and GRANTS Defendant
Setzer’s Motion for Partial Dismissal (ECF No. 12).
I. STANDARD OF REVIEW
Under the Federal Magistrates Act of 1968, district courts are responsible for making “a
de novo determination upon the record . . . of any portion of [a] magistrate judge’s disposition to
which specific written objection has been made.” Fed. R. Civ. P. 72(b); see also 28 U.S.C. §
636(b)(1)(C). Courts need not review portions to which no objection is made. Thomas v. Arn,
474 U.S. 140, 149-50 (1985). Nor are courts tasked with conducting de novo review of “general
and conclusory objections” that fail to direct a judge to specific errors in a magistrate judge’s
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findings and recommendations. Orpiano v. Johnson, 687 F.2d 44, 47-48 (4th Cir. 1982). The
same is true of objections that only reiterate earlier factual or legal assertions. Reynolds v. Saad,
No. 1:17-124, 2018 WL 3374155, at *3 (N.D.W. Va. July 11, 2018), aff’d 738 F. App’x 216 (4th
Cir. 2018). That said, courts maintain wide discretion to “accept, reject, or modify, in whole or in
part, the findings or recommendations” of a magistrate judge. 28 U.S.C. § 636(b)(1)(C).
II. PROCEDURAL BACKGROUND
Plaintiffs filed this suit pro se against Setzer’s World of Camping, Inc. (“Setzer’s”),
People’s Bank, Keystone RV Company (“Keystone”) and Lynn Butler (collectively,
“Defendants”) on June 15, 2020. Among other things, the Complaint alleges that Defendants are
liable for manufacturing and selling a defective camper to Plaintiffs. On July 13, 2020, Setzer’s
filed a Motion for Partial Dismissal of the Complaint under Fed. R. Civ. P. 12(b)(6). ECF No.
12. On July 21, 2020, Keystone filed its “Motion to Dismiss Due to Lack of Subject Matter
Jurisdiction.” ECF No. 17. Plaintiffs responded in opposition to both motions and filed a motion
seeking to amend the Complaint to add a new claim under the Dodd-Frank Wall Street Reform
and Consumer Protection Act. ECF No. 24. Alternatively, Plaintiffs asked the Court to remand
the case to state court. The Court referred all of the above motions to Magistrate Judge Eifert.
Magistrate Judge Eifert subsequently issued her findings of fact and recommended that
the matter be dismissed without prejudice for lack of subject matter jurisdiction. The Magistrate
Judge reached this conclusion after finding that the parties are not diverse and that the Complaint
did not raise a plausible federal question because the claims under the Magnusson-Moss
Warranty Act (“MMWA”) and the Dodd-Frank Act fail as a matter of law. The Magistrate Judge
also found that the case could not be remanded under 28 U.S.C. § 1447 because Plaintiffs did not
start this action in state court. As such, the Magistrate Judge recommended Keystone’s “Motion
2
to Dismiss for Lack of Subject Matter Jurisdiction” be granted, that Setzer’s “Motion for Partial
Dismissal” be denied as moot, and that Plaintiffs’ “Motion to Amend the Complaint, and in the
Alternative, Motion to Remand to State Court” be denied.
Plaintiffs did not object to the Magistrate Judge’s findings regarding their motion to
amend or remand. Therefore, the Court ADOPTS these findings and DENIES Plaintiffs’ motion
(ECF No. 24). Plaintiffs, however, object to the Magistrate Judge’s other findings on numerous
grounds. Plaintiffs concede that this case does not satisfy the requirements for diversity
jurisdiction but argue that the Court has federal question jurisdiction because their MMWA
claims are proper. The Court will address these arguments below after summarizing the facts
alleged in the Complaint.
III. FACTUAL BACKGROUND
The Complaint contains the following allegations, which the Court must accept as true
for the purposes of a motion to dismiss. On June 11, 2018, Plaintiffs bought a 2019 Keystone
trailer camper from Setzer’s. Plaintiffs applied for and received a loan for the camper through
Setzer’s finance department, and Setzer’s assigned the loan to People’s Bank. On June 16, 2018,
Plaintiffs signed the Retail Installment Contract and Security Agreement (“Sales Contract”). The
Sales Contract stated that the warranty was to be provided separately. However, Plaintiffs allege
that they did not receive a separate warranty when they signed the Sales Contract.
On or around August 6, 2018, Plaintiffs noticed water damage inside the camper. A few
weeks later, Plaintiffs brought the camper to Setzer’s for inspection and repair. On September
21, 2018, Plaintiffs picked up the camper from Setzer’s. However, after this attempted repair,
Plaintiffs allege that the camper still suffered water leaks and damage.
On or around November 5, 2018, Plaintiffs notified Setzer’s that the leaks persisted and
3
requested a replacement or refund. Setzer’s “insisted” on another opportunity to repair the
camper and instructed its employee to pick up the camper and “repair it in accordance with the
keystone agreement[.]” Compl. ¶ 132, ECF No. 1. Lynn Butler, the President of Setzer’s,
explained that the “keystone agreement” was the warranty contained in the owner’s manual of
the camper (hereinafter “Owner’s Manual Warranty” or “OMW”). Plaintiffs allege that they
were not made aware of the OMW until that date but “immediately” located it in the camper,
reviewed it, and agreed to permit Setzer’s to pick up the camper. Id. at ¶ 140.
On November 19, 2018, Plaintiffs went to Setzer’s to inspect the camper at Butler’s
request. Plaintiffs did not accept the repairs and claimed that Setzer’s had not addressed their
concerns. The parties continued to dispute the scope of the necessary repairs through the spring.
Setzer’s attempted to repair the camper again at the end of March 2019, but the leaks continued
through July. Soon after, Keystone offered to replace Plaintiffs’ camper and pay their attorneys’
fees. Because Keystone no longer made the model Plaintiffs purchased, Keystone offered
another model. However, Plaintiffs rejected the proposed replacement because they believed that
it was not sufficiently similar to the model they purchased. Plaintiffs requested another model
that they believed to be more similar, but Keystone rejected Plaintiffs’ request. On September 4,
2019, Plaintiffs requested a refund and other damages.
On October 1, 2019, Plaintiffs and Setzer’s employees inspected the camper together.
Using a hose to mimic rain, the parties agreed that there were three or more sources of leaks.
About a month later, Keystone informed Plaintiffs that it had reviewed the findings from the
inspection and again offered two models that Plaintiffs had previously rejected. Plaintiffs
rejected the offer again and filed suit.
IV. ANALYSIS
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A. Subject Matter Jurisdiction under the Magnuson-Moss Warranty Act
To establish subject matter jurisdiction, the Court must find that the Complaint raises an
issue “arising under the Constitution, laws, or treaties of the United States.” See 28 U.S.C. §
1331. A case may “arise under” federal law when a federal statute creates a cause of action. See
Merrill Lynch, Pierce, Fenner & Smith Inc. v. Manning, 136 S. Ct. 1562 (2016). Contrary to
Keystone’s contentions otherwise, the Complaint need not rely exclusively on federal law to
remain in federal court. If the Complaint raises at least one federal question, the Court may
exercise supplemental jurisdiction over state claims “that are so related to claims in the action
within such original jurisdiction that they form part of the same case or controversy under Article
III of the United States Constitution.” 28 U.S.C. § 1367. Given that the Complaint only alleges
federal claims under the MMWA, the validity of those claims will determine whether the Court
has subject matter jurisdiction.
The MMWA authorizes consumers to file suits in federal court for a warrantor’s failure
to comply with any obligation imposed by the act or imposed by a written warranty, implied
warranty, or service contract. 15 U.S.C. § 2310(d)(1). However, federal courts do not have
jurisdiction over a MMWA claim unless the total amount in controversy is at least $50,000
(exclusive of interest and costs). Id. Because the MMWA is silent on the question of remedies,
courts apply state law to determine the potential amount in controversy. Harper v. Navistar, Inc.,
No. 2:15-cv-03558, 2016 U.S. Dist. LEXIS 37473, at *6 (S.D. W. Va. Mar. 23, 2016); see also
Carlson v. Gen. Motors Corp., 883 F.2d 287, 291 (4th Cir. 1989).
The Magistrate Judge found that Plaintiffs’ allegations did not meet this jurisdictional
threshold. Upon review of the OMW, which Plaintiffs submitted to the Court (ECF No. 39-7),
the Magistrate Judge found that Indiana law applied, that the OMW’s limitation on incidental
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and consequential damages was enforceable under Indiana law, and that, in light of this
limitation, Plaintiffs’ recoverable damages were less than $50,000. Plaintiffs’ primary objection
is that the terms of the OMW cannot be enforced because they never accepted the OMW, or
alternatively, because the OMW is unconscionable. The Magistrate Judge neither analyzed the
validity of the OMW nor Plaintiffs’ claim of unconscionability. The Court will address these
objections below after determining the applicable law.
(1) Choice of Law
“Since the MMWA adopts, rather than supplants, state contract law, the Court must from
the outset determine which state’s laws govern Plaintiffs’ MMWA claim.” Harper, 2016 WL
1178782 at 2 (internal citation omitted). To resolve this issue, the Court will apply West Virginia
choice of law rules. 1 West Virginia law provides that “the law of the state in which a contract is
made and to be performed governs the construction of a contract when it is involved in
litigation.” Gen. Elec. Co. v. Keyser, 275 S.E.2d 289, 293 (W. Va. 1981) (quoting Mich. Nat’l
Bank v. Mattingly, 212 S.E.2d 754 (W. Va. 1975)). This rule is known as lex loci delicti, which
“has long been the cornerstone” of West Virginia’s conflicts doctrine. Paul v. Nat’l Life, 352
S.E.2d 550, 555 (W. Va. 1986). Applying this rule, courts have held that when the formation of a
1
The Fourth Circuit has not resolved whether federal or state choice of law rules apply to
cases brought under federal question jurisdiction. See JAAAT Tech. Servs., LLC v. Tetra Tech
Tesoro, Inc., Civil Action No. 3:15-cv-235, 2017 U.S. Dist. LEXIS 146685, at *15 (E.D. Va.
Sep. 11, 2017) (“[D]etermining the applicable choice-of-law rules requires, at a minimum,
creative reasoning.”). However, other district courts in this circuit have held that “[i]n a federal
question case that incorporates a state law issue, such as contract formation, a district court
applies the choice-of-law rules of the state in which it sits unless a compelling federal interest
directs otherwise.” See, e.g., Baker v. Antwerpen Motorcars, Ltd., 807 F. Supp. 2d 386, 387 (D.
Md. 2011) (citing Johnson v. Carmax, Inc., No. 3:10-CV-213, 2010 U.S. Dist. LEXIS 70700,
2010 WL 2802478, at n. 13 (E.D. Va. July 14, 2010)). Therefore, the Court will adopt West
Virginia choice of law rules to determine which state’s laws apply.
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contract is disputed, the court must apply the contract law of the state where the last event
necessary to make a contract binding occurs. Tow v. Miners Mem’l Hosp. Asso., 305 F.2d 73, 75
(4th Cir. 1962). Here, the Complaint alleges that all events related to the formation of the OMW
took place in West Virginia. Therefore, the Court will apply West Virginia law to determine
whether the OMW is valid and enforceable.
(2) Contract Acceptance
Applying West Virginia law, the Court will now consider whether the OMW was validly
formed. Based on the factual allegations in the Complaint, the Court has identified two possible
theories of formation: (1) that Plaintiffs accepted the OMW when they signed the Sales Contract
because it was incorporated by reference, or (2) that Plaintiffs unilaterally accepted the OMW.
To uphold the validity of terms in a document incorporated by reference, the following
must be present:
(1) the writing must make a clear reference to the other document so that the
parties’ assent to the reference is unmistakable; (2) the writing must describe the
other document in such terms that its identity may be ascertained beyond doubt;
and (3) it must be certain that the parties to the agreement had knowledge of and
assented to the incorporated document so that the incorporation will not result
in surprise or hardship.
Evans v. Bayles, 787 S.E.2d 540 (W. Va. 2016).
A facial review of the Complaint and Sales Contract demonstrates that these elements are
not met. The Sales Contract does not identify the OMW by name or any other identifying
feature. It merely states: “Warranty information is provided to you separately.” ECF No. 39-1.
Moreover, based on the allegations in the Complaint, it does not appear that Setzer’s physically
attached the OMW to the Sales Contract or otherwise identified the OMW to Plaintiffs at the
time of sale. Therefore, the Court cannot conclude that Plaintiffs accepted the OMW when they
signed the Sales Contract.
7
Next, the Court must consider whether Plaintiffs accepted the OMW as an independent
contract. The West Virginia Supreme Court of Appeals has long recognized and enforced
unilateral contracts: “acceptance may be effected by silence accompanied by an act of the offeree
which constitutes a performance of that requested by the offeror . . . . ” Citynet, LLC v. Toney,
772 S.E.2d 36, 41-42 (W. Va. 2015) (quoting First National Bank [of Gallipolis] v. Marietta
Manufacturing Co., 153 S.E.2d 172, 176 (W. Va. 1967)) (internal quotation marks omitted).
According to the Complaint, Setzer’s told Plaintiffs that an employee would “pick up the
camper and ‘repair it in accordance with the [OMW].’” Compl. ¶ 132. Although Plaintiffs alleged
that they had not seen this agreement before, they admit that they obtained a copy from inside
their camper and reviewed it “immediately.” Id. at ¶ 140. They further admit that the warranty
states: “WHEN YOU REQUEST AND ACCEPT THE PERFORMANCE OF WARRANTY
REPAIRS UNDER THE TERMS OF EITHER LIMITED WARRANTY, YOU ARE
ACCEPTING ALL TERMS OF BOTH LIMITED WARRANTIES.” Id. at ¶ 151 (emphasis in
original); ECF No. 39-7. After reviewing the OMW, Plaintiffs “agreed the camper would be
picked up the next day to permit Setzer’s another attempt at diagnosing and repairing the
camper.” Id. at ¶ 133. Under these allegations, the Court must reject Plaintiffs’ argument that
they did not accept the OMW.
(3) Unconscionability
Plaintiffs next argue that the OMW is unconscionable. West Virginia law prohibits
clauses and contracts which are unconscionable. See W.Va. Code § 46A-2-121.
“Unconscionability in West Virginia . . . requires both ‘gross inadequacy in bargaining power’
and ‘terms unreasonably favorable to the stronger party.’” Adkins v. Labor Ready, Inc., 303 F.3d
496, 502 (4th Cir. 2002) (quoting Troy Mining Corp. v. Itmann Coal Co., 346 S.E.2d 749 (W.
8
Va. 1986)). In other words, both substantive and procedural unconscionability are required. To
determine whether these elements are met, the Court must consider the particular facts of the
case. See Orlando v. Finance One of West Virginia, Inc., 369 S.E.2d 882, 883 Syll. 2 (1988).
In support of their objection, Plaintiffs point to Carlson, 883 F.2d 287, a decision in
which the Fourth Circuit considered whether an express warranty imposing a durational limit on
all implied warranties was “reasonable” and “conscionable” under the MMWA. Carlson, 883
F.2d at 292. Although Carlson did not apply West Virginia law, this Court finds its analysis
instructive. The Fourth Circuit started its analysis by noting that “unconscionability claims
should but rarely be determined on the bare-bones pleadings—that is, with no opportunity for the
parties to present relevant evidence of the circumstances surrounding the original consummation
of their contractual relationship.” Id. As such, the court held that the district court erred in
dismissing the complaint because the plaintiffs should have had the opportunity to present
evidence that they had no meaningful choice but to accept the express warranty or that the terms
unreasonably favored the seller. Id. at 296. The court also reviewed the complaint and held that
the plaintiffs “more than sufficiently” pleaded unconscionability. Specifically, the court noted
that if, as the plaintiffs alleged, the defendant knew of certain defects but failed to warn
consumers, the durational limitations on implied warranties would be unconscionable within
meaning of MMWA. Id. at 294-96.
As noted above, Plaintiffs plausibly alleged that they did not accept the OMW until at
least November 2018. The Complaint states that by that time, Setzer’s had already failed to
repair the camper once and refused to give Plaintiffs a replacement or refund. After this refusal,
“Setzer’s insisted on another opportunity to diagnose and fix the camper” and “instructed [an
employee] to pick up the camper and repair it in accordance with the [OMW].” Compl. ¶ 132
9
(internal quotations omitted). Although Plaintiffs were able to locate the OMW and review it for
the first time, the Complaint indicates that they had no meaningful choice but to accept Setzer’s
offer. Setzer’s and Keystone’s bargaining power grossly exceeded Plaintiffs’ because Plaintiffs
had already purchased the camper and notified Setzer’s of its defects. Given that Setzer’s had
already failed to repair the camper and refused to provide a replacement or refund, Plaintiffs
were left with only two options: accept Setzer’s offer and sacrifice their potential remedies or
accept the defective camper. This is not a meaningful choice. The Court also finds that the terms
of the agreement unreasonably benefit the warrantor by limiting incidental and consequential
damages, including expenses Plaintiffs incurred when trying to fix a defect Keystone and
Setzer’s allegedly knew about but failed to disclose. See id. at ¶ 444 (Setzer’s employee stated
that Keystone campers leak “a lot of times.”) For these reasons, the Court finds that Plaintiffs
have alleged a plausible unconscionability claim.
(4) Breach of Implied Warranty
Setting the OMW aside, the Court also finds that the Magistrate Judge erred by
recommending dismissal without considering Plaintiffs’ breach of implied warranty claim under
the MMWA against Setzer’s. It is possible that the Magistrate Judge did not analyze this claim
because the OMW disclaimed all implied warranties. However, even if the Plaintiffs had not
sufficiently pleaded an unconscionability claim, this type of disclaimer is likely unenforceable
under the MMWA. See 15 U.S.C. § 2308 (prohibiting disclaimers of implied warranties where
the warrantor issues an express warranty or service contract). Accordingly, the Court must
consider whether subject matter jurisdiction is established by this claim.
The MMWA permits individuals to bring actions for breach of an implied warranty. 15
U.S.C. § 2310. Such warranties are defined by the act as “arising under State law (as modified by
10
Sections 2308 and 2304(a) of this title) in connection with the sale by a supplier of a consumer
product.” Id. at § 2301. Under West Virginia law, an implied warranty arises out of a contract for
the sale of consumer goods. W. Va. Code § 46-2-314. Plaintiffs have alleged that they had a
contract with Setzer’s for the sale of the camper. See Sales Contract, ECF No. 39-1. Plaintiffs
further allege that Setzer’s breached the implied warranty arising from that contract by failing to
repair, replace, or refund the camper after numerous attempts to cure. Thus, Plaintiffs have
sufficiently pleaded a breach of implied warranty claim under the MMWA against Setzer’s. 2
(5) Amount in Controversy
The Court must next determine whether the Plaintiffs have satisfied the MMWA’s
$50,000 amount-in-controversy requirement under this claim. The amount sought in the
complaint ordinarily determines the amount in controversy, so long as the plaintiff has advanced
the figure in good faith. Lanier v. Norfolk Southern Corp., 256 F. App’x 629, 631-32 (4th Cir.
2007) (citing Wiggins v. North Am. Equitable Life Assur. Co., 644 F.2d 1014, 1016-17 (4th Cir.
1981)). Courts may only dismiss a claim “if it appears to a legal certainty” that the amount has
not been satisfied. Id.
Plaintiffs claim the following damages:
$26,806.86 Camper Financing
$2,000.00
Value of Trade-in 3
$100.00
Towing Costs
$75.00
Water/Sewage
$100.00
Anti-freeze
$1,000.00
Personal Property Taxes
2
The Court expresses no opinion as to whether a similar cause of action may be
advanced against Keystone.
3
Plaintiffs claim that the value of the trade-in is $2,500. However, the Sales Contract
states that the Plaintiffs were credited $2,000.
11
$1,141.00
Insurance
$2,340.00
Storage for Camper
$20,500.00 Aggravation, Inconvenience, Annoyance 4
Pltfs’ Resp. to Keystone’s Mot. to Dismiss, ECF No. 23. The Court cannot conclude that any of
these claims are legally impermissible or made in bad faith. 5
In addition, Plaintiffs claim that Defendants are liable for punitive damages. Punitive
damages are recoverable under the MMWA for breach of warranty only if they may be
recovered in a breach of warranty action brought under the governing state law. Saval v. BL Ltd.,
710 F.2d 1027, 1033 (4th Cir.1983). Given that West Virginia is the state in which the Sales
Contract was executed, its law governs. Under West Virginia law, punitive damages are
generally unavailable in a breach of contract action absent an “independent, intentional tort
committed by the defendant.” See Berry v. Nationwide Mut. Fire Ins. Co., 381 S.E.2d 367 (W.
Va. 1989). Several courts have recognized that fraud and misrepresentation are independent,
intentional torts under this doctrine. See, e.g., Med-Surg Grp., Inc. v. Aetna Health Mgmt., Inc.,
832 F. Supp. 2d 659, 661 (S.D. W. Va. 2011).
Plaintiffs sufficiently alleged fraudulent misrepresentation and concealment, claiming
that Setzer’s knew that the Keystone campers were defective but concealed that fact from
Plaintiffs before the sale. According to the Complaint, a Setzer’s employee told Plaintiffs after
4
Pursuant to the Court’s ability to broadly interpret pro se claims, the Court has
construed Plaintiffs’ loss of income and loss of use claims as additional claims for relief based on
inconvenience.
5
The Court has excluded from the calculation Plaintiffs’ request for attorneys’ fees and
damages for loss of consortium. Attorneys’ fees are excluded from the jurisdictional calculation
under the MMWA, Saval, 710 F.2d at 1032, and the Court is not aware of any West Virginia
precedent that permits plaintiffs to recover for loss of consortium pursuant to an injury for breach
of contract. The Court has also excluded Plaintiffs’ claim for $6,723.86 in loan payments
because it appears that this claim overlaps with “Camper Financing.”
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the sale: “a lot of times Keystone campers’ windows will leak around the weep holes” and that
“a lot of times Keystone campers leak around the vents were [sic] Keystone puts them together.”
Compl. ¶¶ 444, 472. Therefore, the Court finds that Plaintiffs’ claim for punitive damages is
plausible, that the amount in controversy is at least $50,000, and that the Court has jurisdiction
under the MMWA. Keystone’s Motion to Dismiss is DENIED.
B. Defendant Setzer’s Partial Motion to Dismiss
The Court will now turn to Setzer’s Motion for Partial Dismissal. Setzer’s argues that
Counts III, VI, IX, XIV, and XV fail to state a claim upon which relief can be granted, and
therefore, should be dismissed under Rule 12(b)(6). 6 The Court agrees.
(1) Counts III, XIV, and XV
Plaintiffs plead three counts that are not causes of action for which relief may be granted:
Count III (shaken faith), Count XIV (joint and several liability), and Count XV (punitive
damages). The Court dismisses these counts under Rule 12(b)(6). However, in doing so, the
Court expresses no opinion as to whether the shaken faith doctrine applies within the context of
other claims, whether Defendants are jointly and severally liable, or whether punitive damages
may be a permissible remedy.
(2) Count IX
Next, Setzer’s argues that Plaintiffs’ negligence claims should be dismissed under the gist
of the action doctrine. Under this doctrine, recovery in tort will be barred when any one of the
following factors is present:
(1) where liability arises solely from the contractual relationship between the
parties; (2) when the alleged duties breached were grounded in the contract
6
Setzer’s also moved to dismiss Count II (Revocation of Acceptance). However, after
Plaintiffs clarified the cause of action in their response, Setzer’s conceded that the claim was
actionable.
13
itself; (3) where any liability stems from the contract; and (4) when the tort claim
essentially duplicates the breach of contract claim or where the success of the
tort claim is dependent on the success of the breach of contract claim.
Gaddy Eng’g Co. v. Bowles Rice McDavid Graff & Love, LLP, 746 S.E.2d 568, 577 (W. Va.
2013) (internal citations omitted). “If the action is not maintainable without pleading and proving
the contract . . . it is, in substance, an action on the contract . . . .” Dan Ryan Builders, Inc. v.
Crystal Ridge Dev., Inc., 803 S.E.2d 519, 526 (2017) (quoting Cochran v. Appalachian Power
Co., 246 S.E.2d 624, 628 (W. Va. 1978)).
Plaintiffs claim that the Defendants’ duty lay outside of the Sales Contract because
“Defendants owed a common duty to diagnose, repair, and service the camper in a non-negligent
manner.” This argument is wholly without merit. Defendants’ “duty to diagnose, repair, and
service the camper” arises directly from the contractual relationship formed when Plaintiffs
bought the camper. Plaintiffs contend that no contractual duty existed because the Sales Contract
did not expressly contain a provision requiring repair. This point is belied by Plaintiffs’ own
argument that that Defendants were bound by an implied warranty of merchantability. The law
does not impose such a warranty absent a contractual relationship. See W. Va. Code, § 46-2-314.
Therefore, the fact that the warranty was not expressly included in the Sales Contract is
inapposite. The Court dismisses Plaintiffs’ negligence claims.
(3) Count VI
Plaintiffs also assert a cause of action for “Intentional Torts, Willfulness, Wantonness,
Malice, Oppression, Reckless Conduct, Criminal Indifference to Civil Obligations, Aggravation
of Wrong to the Mr. and Mrs. Murphy.” It is unclear which intentional tort Plaintiffs intended to
assert. As pleaded, Plaintiffs recite the standard for granting punitive damages, not a legal cause
of action. See Alkire v. First Nat. Bank of Parsons, 475 S.E.2d 122 (W. Va. 1996) (“In actions of
tort, where gross fraud, malice, oppression, or wanton, willful, or reckless conduct or criminal
14
indifference to civil obligations affecting rights of others appear, or where legislative enactment
authorizes it, jury may assess exemplary, punitive, or vindictive damages.”)
To the extent that Count VI can be interpreted as a cause of action, the allegations most
resemble intentional infliction of emotional distress or “tort of outrage.” Under West Virginia
law, a plaintiff must show that the defendant’s “extreme and outrageous conduct intentionally or
recklessly causes severe emotional distress to another.” Harless v. First National Bank, 289
S.E.2d 692, 693 Syll. 6 (1982). This definition is patterned after Section 46 of the Restatement
(Second) of Torts which requires that the conduct be “so outrageous in character, and so extreme
in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious and
utterly intolerable in a civilized community.” Id. at 704-05.
The only specific conduct Plaintiffs plead under this count is the allegation that
Defendants blamed Plaintiffs for causing water damage in the camper. This does not rise to the
level of outrageous conduct required under the law. Plaintiffs also assert general claims that
Defendants acted “combative[ly] and argumentative[ly],” with “disrespect” and violated a duty
arising out of “great public social policy.” These are merely complaints of rudeness, which are
inadequate to establish intentional infliction of emotion distress. Accordingly, the Court
dismisses Count VI and GRANTS Setzer’s motion.
V. CONCLUSION
Consistent with this Opinion, the PF&R (ECF No. 40) is REJECTED IN PART and
ADOPTED IN PART. The Court DENIES Keystone’s Motion to Dismiss (ECF No. 17) and
Plaintiffs’ Motion to Amend or Remand (ECF No. 24). The Court GRANTS Defendant Setzer’s
Motion for Partial Dismissal (ECF No. 12) and DISMISSES the following claims:
Count III
Shaken Faith
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Count IX
Negligence
Count IV
Intentional Torts
Count XIV Joint and Several Liability
Count XV
Punitive Damages
The remaining claims are REFERRED back to the Magistrate Judge for pretrial
management and submission of proposed findings of fact and recommendations consistent with
this Court’s June 16, 2020 Standing Order (ECF No. 7).
The Court DIRECTS the Clerk to send a copy of this Opinion to counsel of record and
any unrepresented parties.
ENTERED: January 29, 2021
ROBERT C. CHAMBERS
UNITED STATES DISTRICT JUDGE
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