Cunningham v. Ford Motor Co.

641 F.Supp.3d 400

William CUNNINGHAM, et al., Plaintiffs, v. FORD MOTOR COMPANY, Defendant.

Case No. 21-cv-10781

United States District Court, E.D. Michigan, Southern Division

Signed November 17, 2022

Adam J. Levitt, Blake Stubbs, DiCello Levitt & Casey LLC, Chicago, IL, Chicago, IL, Daniel R. Ferri, John E. Tangren, DiCello Levitt Gutzler LLC, Chicago, IL, Dana Fraser, Dennis A. Lienhardt, Sharon S. Almonrode, Emily E. Hughes, E. Powell Miller, The Miller Law Firm, P.C., Rochester, MI, Dylan Thomas Martin, H. Clay Barnett, III, James Mitchell Williams, W. Daniel Miles, III, Rebecca D. Gilliland, Beasley Allen et al. Fraud Department, Montgomery, AL, for Plaintiffs William Cunningham, Tri-State Collision, LLC.

Blake Stubbs, DiCello Levitt LLC, Chicago, IL, Dana Fraser, Emily E. Hughes, E. Powell Miller, The Miller Law Firm, P.C., Rochester, MI, Dylan Thomas Martin, Rebecca D. Gilliland, Beasley Allen et al. Fraud Department, Montgomery, AL, for Plaintiffs Joel Weiss, Jeff Moestretti.

Jason Ryan Hodge, Robert Latane Wise, Sandra G. Ezell, Nelson Mullins Riley & Scarborough LLP, Richmond, VA, Kathleen S. Corpus, Bowman and Brooke LLP, Bloomfield Hills, MI, Sunny Rehsi, Bowman and Brooke LLP, Bloomfield, MI, for Defendant.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS (ECF No. 30)

MATTHEW F. LEITMAN, UNITED STATES DISTRICT JUDGE

In this putative class action, Plaintiffs William Cunningham and Joe Moestretti bring claims against Defendant Ford Motor Company based upon an alleged defect in the tailgate latch release switch of their Ford pickup trucks.¹ (See Am. Compl., ECF No. 27.) Ford has now moved to dismiss all of Cunningham's and Moestretti's claims. (See Mot. to Dismiss, ECF No. 30.) For the reasons explained below, Ford's motion is GRANTED IN PART AND DENIED IN PART.

I

Ford is one of the world's leading automakers. Plaintiffs are consumers who "purchased or leased one or more model year 2017-2021 Ford F-250, F-350, and F-450 Super Duty vehicles equipped with an electronic tailgate latch release switch" (the "Class Vehicles"). (Am. Compl. at ¶1, ECF No. 27, PageID.621.) According to Plaintiffs, their vehicles suffer from a defect that causes their "tailgates [to] unintentionally open, including while [their] vehicle[s are] in motion" (the "Tailgate Defect"). (Id. at ¶3, PageID.622.) Plaintiffs say that the "Tailgate Defect presents a serious risk of harm to occupants and others sharing the road. First, the Tailgate Defect can result in loss of unrestrained cargo, increasing the risk of injury or crash. Second, the Tailgate Defect can cause the tailgate to release and contact towed trailers, damaging both the tailgate and trailer. [Finally], the Tailgate Defect can reduce the clearance between [a Class vehicle] and a towed trailer, limiting the vehicle's range of mobility and increasing the risk of injury or crash." (Id. at ¶6, PageID.622.)

Plaintiffs further claim that even though Ford "kn[ew] that the Class Vehicles contained a dangerously defective and unreliable tailgate latch system," Ford nonetheless "continued to sell Class Vehicles and market them as safe, dependable, and capable of carrying, towing, and hauling heavy cargo and equipment." (Id. at ¶23, PageID.627.) And Plaintiffs say that they "were harmed" by Ford's failure to alert them of the Tailgate Defect because the defect "renders the Class Vehicles less safe and less valuable than consumers would reasonably expect, and less safe and less valuable than the Class Vehicles would be if Ford did not design, manufacture and sell or lease the Class Vehicles with the Tailgate Defect." (Id. at ¶24, PageID.627.) Finally, Plaintiffs insist that if Ford had "disclosed the Tailgate Defect, Plaintiffs and other [c]lass members would not have purchased or leased their vehicles or would have paid less for them." (Id. at ¶91, PageID.642-643.)

II

Plaintiffs filed their First Amended Class Action Complaint, the operative pleading in this action, on September 27, 2021. Plaintiff Cunningham is a Georgia resident who "purchased a new 2019 Ford F-250 from Fitzgerald Ford in Fitzgerald, Georgia on November 6, 2019." (Id. at ¶¶ 47-48, PageID.633.) Plaintiff Moestretti is a North Carolina resident who "purchased a used 2018 F-350 from David McDavid Ford in Fort Worth, Texas in June 2019." (Id. at ¶¶ 55-56, PageID.635.)

Cunningham and Moestretti bring claims against Ford for fraud, breach of express and implied warranties under state law and under the federal Magnuson-Moss Warranty Act, 15 U.S.C. § 2301, et seq. (the "MMWA"), unjust enrichment, and violations of the consumer protection laws of Georgia and Texas. They also seek to represent a class of nationwide plaintiffs and individual state-specific sub-classes.

Ford first moved to dismiss Cunningham's and Moestretti's claims on June 15, 2021. (See First Mot. to Dismiss, ECF No. 13.) Rather than respond to that motion, Cunningham and Moestretti filed an Amended Complaint that sought to remedy the alleged pleading deficiencies that Ford identified. (See Am. Compl., ECF No. 27.) On November 24, 2021, Ford moved to dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (See Mot. to Dismiss, ECF No. 30.) The Court held an in-person hearing on the motion on June 15, 2022.

III

"To survive a motion to dismiss" under Rule 12(b)(6), "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, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A claim is facially plausible when a plaintiff pleads factual content that permits a court to reasonably infer that the defendant is liable for the alleged misconduct. See id. When assessing the sufficiency of a plaintiff's claim, a district court must accept all of a complaint's factual allegations as true. See Ziegler v. IBP Hog Mkt., Inc., 249 F.3d 509, 512 (6th Cir. 2001). Mere "conclusions," however, "are not entitled to the assumption of truth. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Iqbal, 556 U.S. at 679, 129 S.Ct. 1937. A plaintiff must therefore provide "more than labels and conclusions," or "a formulaic recitation of the elements of a cause of action" to survive a motion to dismiss. Twombly, 550 U.S. at 555, 127 S.Ct. 1955. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937.

IV

Ford moves to dismiss Cunningham's and Moestretti's claims on several grounds. The Court will address each of Ford's bases for dismissal separately in the order that Ford presented them in its briefing.

A

Ford first argues that the Court should dismiss all of Cunningham's and Moestretti's claims brought under Michigan law. (See Mot. to Dismiss, ECF No. 30, PageID.1102, citing Counts 2-6 of the Amended Complaint.) Ford contends that Michigan law does not apply here. Ford's argument, in its entirety, consists of the following three sentences:

No plaintiff is a Michigan resident, nor have they purchased, registered, or sought service for a vehicle in Michigan. As this Court has recognized, when there is no Michigan plaintiff or purchase, other states have a superior interest in having their laws applied to claims. See McKee v. Gen. Motors LLC, 376 F. Supp. 3d 751, 756 (E.D. Mich. 2019). The Court should dismiss the Michigan claims.

(Id.) The Court declines to dismiss Cunningham's and Moestretti's Michigan claims on this basis.

Ford has not conducted the required choice-of-law analysis. "To determine whether a rational reason exists to displace Michigan law, the Court conducts a two-step analysis." McKee v. General Motors, LLC, 376 F.Supp.3d 751, 756 (E.D. Mich. 2019). "First, the Court must determine whether a foreign state has an interest in having its law applied. Second, the Court must decide whether Michigan's interests in applying its law nevertheless mandate application of Michigan law." Id. Ford has not offered any analysis of either step. Instead, Ford relies entirely on the decision in McKee to apply Florida law instead of Michigan law to the parties' dispute over an automotive defect. But McKee is distinguishable. In McKee, "neither party dispute[d] that Florida law applie[d]." Id. Here, there is such a dispute. Thus, it was incumbent upon Ford to provide a careful choice-of-law analysis. Because Ford failed to provide the required analysis, the Court will not dismiss Cunningham's and Moestretti's Michigan-law claims at this time. Ford may re-raise (and properly support) its argument that Cunningham and Moestretti may not raise claims under Michigan law at a later stage of these proceedings.²

B

The Court next turns to Cunningham's and Moestretti's claims that arise out of Ford's alleged fraudulent omissions. (See Am. Compl., ECF No. 27, at Counts 2, 6, 23, 25-26, 29, and 31.) "For claims involving fraudulent omissions," like those at issue here, Federal Rule of Civil Procedure 9(b) "requires a plaintiff to plead the who, what, when, where, and how of the alleged omission." McKee, 376 F.Supp.3d at 760-61. "Specifically, a plaintiff pleading a fraudulent omission must allege (1) precisely what was omitted; (2) who should have made a representation; (3) the content of the alleged omission and the manner in which the omission was misleading; and (4) what [defendant] obtained as a consequence of the alleged fraud." Id. at 761 (internal quotation marks omitted). In the context of an allegedly defective product, "[a] complaint may suffice if it alleges that a manufacturer knew of a defect before sale, the various venues the manufacturer used to sell the product failed to disclose the defect, and that the plaintiffs would not have purchased the product or would have paid less for it had t...