Langer v. BMW of North America, LLC

533 F.Supp.3d 626

Menachem LANGER, Plaintiff,

v.BMW OF NORTH AMERICA, LLC, Defendant.

No. 3:20-CV-00037-JRG-CRW

United States District Court, E.D. Tennessee, Northern Division, at Knoxville.

Filed February 3, 2021

Vlad Hirnyk, Pro Hac Vice, Lemberg Law, LLC, Wilton, CT, Susan Shepherd Lafferty, Lafferty Law Firm, Inc., Nashville, TN, for Plaintiff.

Ryan Nelson Clark, Lewis, Thomason, King, Krieg & Waldrop, P.C., Nashville, TN, for Defendant.

MEMORANDUM OPINION AND ORDER

J. RONNIE GREER, UNITED STATES DISTRICT JUDGE

This matter is before the Court on Defendant's Motion to Dismiss [Doc. 28], Defendant's Memorandum of Law in Support [Doc. 29], Plaintiff's Response [Doc. 32], Defendant's Reply [Doc. 33], Defendant's Supplemental Brief [Doc. 34], and Plaintiff's Response [Doc. 36]. For the reasons herein, the Court will deny Defendant's motion.

I. BACKGROUND

Plaintiff Menachem Langer alleges that in 2017 he purchased a 2014 BMW 750Li from Atlanta Luxury Motors in Georgia for $37,442, only to discover afterwards that it "consumed an excessive amount of engine oil." [Am. Compl., Doc. 1, ¶¶ 14–16]. He maintains that he has had to "regularly add[ ] quarts of oil to his car in between oil changes" to prevent the engine—known as the "N63," a "large, high-performance engine [that] was designed to be BMW's next generation V8," [id. ¶ 34]—from failing, [id. ¶¶ 2, 20]. He alleges that the N63 is defective and that it is, in fact, "widely known" as defective, [id. ¶ 37], citing several technical service bulletins that BMW issued to address complaints of excessive oil consumption¹ and the filing of at least one other lawsuit in federal district court, [id. ¶¶ 5, 47]. According to Mr. Langer, BMW knew that the N63 was defective as early as 2008, having learned of its excessive oil consumption from "pre-release testing data, durability testing, [and] early consumer complaints." [Id. ¶ 64]. But BMW concealed its knowledge of the defect, Mr. Langer alleges, not only when he bought the vehicle in 2017 but also when he later presented the vehicle to Grayson BMW in Knoxville, Tennessee ("Grayson BMW")—an authorized dealer of Defendant BMW of North American, LLC ("BMW")—with complaints about its oil consumption. [Id. ¶¶ 3, 4, 17, 18]. In response, Grayson BMW allegedly told him that "there was nothing wrong with [the] N63 engine in [his] car and having to add quarts of oil in between oil changes was ‘normal.’ " [Id. ¶ 3].

Mr. Langer claims that BMW has "neglected, failed, refused or otherwise been unable to repair" the engine, [id. ¶ 68], despite the fact that the vehicle was under a four-year/50,000-mile limited warranty, in which BMW agreed to repair or replace defective parts, [id. ¶¶ 25–27]. According to Mr. Langer, his vehicle's excessive oil consumption has required him to pay for additional service visits and maintenance costs, obtain BMW-approved engine oil, and refrain from traveling long distances. [Id. ¶ 67]. Specifically, he alleges that he has spent $,1000 in "out of pocket costs." [Id. ¶ 22]. In addition, he alleges that he will "suffer significant loss" when he attempts to sell the vehicle because "the reputation of these vehicles has been impaired by now-public research establishing that these vehicles suffer from the oil consumption defect." [Id. ¶ 67]. Mr. Langer also maintains that "[t]he cost to repair the Vehicle that involves an engine replacement ranges from $12,500.00 to $15,000.00." [Id. ¶ 21].

Mr. Langer has now filed suit in this Court against BMW, alleging claims for breach of warranty under the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301 et seq. (Count One); breach of express warranties under Tennessee law (Count Two); violation of the Tennessee Consumer Protection Act ("TCPA"), Tennessee Code Annotated § 47-18-101 et seq. (Count Three); violation of the Georgia Fair Business Practice Act ("GFBPA"), Georgia Code Annotated § 10-1-390 et seq. (Count Four); and fraudulent concealment under Tennessee law (Count Five). Among other remedies, Mr. Langer requests "revocation or rescission" of his purchase of the vehicle. [Am. Compl. at 29].

BMW now moves for the dismissal of each of these claims for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1). In the alternative, it moves for the dismissal of Counts Three, Four, and Five for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). See [Def.’s Mem. at 2] ("[I]f the Court finds that it has subject matter jurisdiction, it should nevertheless dismiss Counts III, IV, and V[.]"). BMW also argues that Mr. Langer's complaint violates Federal Rule of Civil Procedure Rule 8(a) because it is "neither short nor plain’ " [Id. at 15]. In response to BMW's motion to dismiss, Mr. Langer has "withdraw[n] the following causes of action: Violation of Georgia Fair Business Practice Act (Count IV) and Fraudulent Concealment (Count V)." [Pl.’s Resp. at 1 n.2]. The sole questions before the Court, therefore, are whether it has subject-matter jurisdiction over this action and whether Mr. Langer has stated a plausible claim for relief in Count Three, in which he alleges violations of the TCPA.

II. LEGAL STANDARD

Under Rule 8(a)(2), "[a] pleading that states a claim for relief must contain ... a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). To survive a motion to dismiss under Rule 12(b)(6), the plaintiff's 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 Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). A claim is facially plausible when the plaintiff pleads facts that create a reasonable inference that the defendant is liable for the alleged conduct in the complaint. Id.

When considering a motion to dismiss under Rule 12(b)(6), a court accepts the allegations in the complaint as true and construes them in a light most favorable to the plaintiff. Mixon v. Ohio , 193 F.3d 389, 400 (6th Cir. 1999). "[T]he tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions," however. Iqbal , 556 U.S. at 678, 129 S.Ct. 1937. A plaintiff's allegations must consist of more than "labels," "conclusions," and "formulaic recitation[s] of the elements of a cause of action." Twombly , 550 U.S. at 555, 127 S.Ct. 1955 (citation omitted); see Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 ("Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." (citation omitted)).

A motion to dismiss under Rule 12(b)(1), on the other hand, implicates the Court's subject matter jurisdiction, Fed. R. Civ. P. 12(b)(1), and it comes in one of two forms, a facial attack or a factual attack, McCormick v. Miami Univ. , 693 F.3d 654, 658 (6th Cir. 2012). A facial attack is "a challenge to the sufficiency of the pleading itself," United States v. Ritchie , 15 F.3d 592, 598 (6th Cir. 1994), and the Court, when addressing this kind of attack, therefore applies Rule 12(b)(6) ’s standard, Carrier Corp. v. Outokumpu Oyj , 673 F.3d 430, 440 (6th Cir. 2012).

III. ANALYSIS

Under Rule 12(b)(1), BMW argues that the Court lacks subject-matter jurisdiction over this action because Mr. Langer has not pleaded facts that satisfy the Magnuson-Moss Warranty Act's amount-in-controversy requirement. See Musson Theatrical, Inc. v. Fed. Express Corp. , 89 F.3d 1244, 1255 (6th Cir. 1996) ("The vast majority of pretrial dismissals ... do not affect the trial court's ability to resolve supplemental claims. But there are two types of pretrial dismissals that appellate courts have scrutinized closely. The first is a dismissal under Rule 12(b)(1). If the court dismisses plaintiff's federal claims pursuant to Rule 12(b)(1), then supplemental jurisdiction can never exist."). In the alternative, BMW, under Rule 12(b)(6), challenges Mr. Langer's allegations in Count III as factually insufficient to support a plausible claim for relief.

A. Subject-Matter Jurisdiction

The Magnuson-Moss Warranty Act provides federal district courts with jurisdiction over certain claims. See 15 U.S.C. § 2310(d)(1)(B) ("[A] consumer who is damaged by the failure of a supplier, warrantor, or service contractor to comply with ... a written warranty, implied warranty, or service contract, may bring suit for damages" in federal district court.). The statute, however, contains an amount-in-controversy requirement of $50,000, on which jurisdiction is dependent: "No claim shall be cognizable in a suit brought under paragraph (1)(B) of this subsection ... if the amount in controversy is less than the sum or value of $50,000 (exclusive of interests and costs) computed on the basis of all claims to be determined in this suit[.]" Id. § 2310(d)(3)(B).

"It is well-settled that ‘if a plaintiff brings an action in federal court and a defendant seeks dismissal on amount-in-controversy grounds, the case will not be dismissed unless it appears that the plaintiff's assertion of the amount in controversy was made in bad faith.’ " Schultz v. Gen. R.V. Ctr. , 512 F.3d 754, 756 (6th Cir. 2008) (quotation omitted). The defendant bears the burden of establishing that the plaintiff alleged the amount in controversy in bad faith—a burden that he discharges by showing "to a legal certainty[ ] that the original claim was really for less than the amount-in-controversy requirement." Id. (quotation omitted). Although the legal-certainty test normally applies to the amount in controversy in diversity cases under 28 U.S.C. § 1332, it also applies "in full force" to the amount-in-controversy requirement under the Magnuson-Moss Warranty Act. Id. (citations omitted). The Court may consider all state-law claims when deciding whether a plaintiff has met the Magnuson-Moss Warranty Act's...