Maugain v. FCA U.S. LLC

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ETIENNE MAUGAIN et al., Plaintiffs, v. FCA U.S. LLC, Defendant.

Civil Action No. 22-116-GBW

United States District Court, D. Delaware

February 7, 2023

Kelly A. Green, SMITH, KATZENSTEIN, & JENKINS LLP, Wilmington Delaware; Russell D. Paul, Abigail J. Gertner, Amey J. Park Natalie Lesser, BERGER MONTAGUE PC, Philadelphia Pennsylvania; Tarek H. Zohdy, Cody R. Padgett, Laura Goolsby CAPSTONE LAW APC, Los Angeles, California; Steven Calamusa, Geoff Stahl, Rachel Bentley, GORDON & PARTNERS, P.A., Palm Beach Gardens, Florida; Geoffrey Graber, Brian E. Johnson, COHEN MILSTEIN SELLERS & TOLL PLLC, Washington, D.C. Counsel for Plaintiffs

Patrick M. Brannigan, Jessica L. Reno, ECKERT SEAMANS CHERIN & MELLOTT, LLC, Wilmington, Delaware; Stephen A. D'Aunoy, Scott H. Morgan, THOMPSON COBURN LLP, St. Louis, Missouri. Counsel for Defendants

MEMORANDUM OPINION

GREGORY B. WILLIAMS, UNITED STATES DISTRICT JUDGE

Plaintiffs Etienne Maugain, Louise Shumate, Denise Hunter, Harry Reichlen, John Kundrath, Kenneth Esteves, John Skleres, Richard Archer, Stephen Dreikosen, and Leonel Cantu (collectively, "Plaintiffs") filed this consumer class action against Defendant FCA U.S. LLC ("FCA") to obtain monetary relief based on FCA's alleged failure to disclose engine defects in "2014 or newer Chrysler, Dodge, Jeep, or RAM-branded vehicles equipped with 3.6L Pentastar V6 engine ('Class Vehicles')." D.I. 34 at 1,191. Plaintiffs' claims stretch to 906 paragraphs over 192 pages and sound in thirty-three counts. See D.I. 34. Thirty of the Counts allege violations of California, Florida, Georgia, Illinois, Massachusetts, New Hampshire, New York, Pennsylvania, or Texas law. D.I. 34 ¶¶ 314-904. Count III alleges violation of the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301, ("MMWA"), D.I. 34 ¶¶ 294-313, and Counts I and II allege common law fraud by omission (or fraudulent concealment) and unjust enrichment, D.I. 34 ¶¶ 272-93. FCA now moves to dismiss Plaintiffs' First Amended Class Action Complaint (the "Complaint") for lack of standing as to claims related to certain Class Vehicles or under the laws of states in which the named plaintiffs do not reside, under Federal Rule of Civil Procedure 12(b)(1), and for failure to state a claim on which relief can be granted, under Rule 12(b)(6) (the "Motion"). D.I. 46; D.I. 47 at 1-2. The Court grants-in-part and denies-in-part FCA's Motion.^[1]

I. BACKGROUND^[2]

FCA sold Class Vehicles "with a defective 3.6L engine and falsely marketed the vehicles as safe to drive, durable, reliable, and capable of providing transportation." D.I. 34 ¶¶ 1, 3. The defective engines "prematurely fail" and are unable to accomplish "the fundamental elements of the function of an internal combustion engine" D.I. 34 ¶ 4. The vehicles generate an "audible ticking noise" and then may "buck and surge" and, eventually, the engines may fail while the vehicles are "being driven, leading to an increased threat of stalling, loss of motive power[,] and collision." D.I. 34 ¶ 5. FCA knew "as early as 2013" about these severe defects-such as from internal testing, complaints, and supplier communications-but still "touted the quality, durability, reliability, and performance" of the vehicles at issue "via its public statements and multimedia marketing campaigns." D.I. 34 ¶¶ 6,16. FCA has also instructed car dealers to replace defective parts with new parts that have the same defect "while informing consumers that the vehicles are fixed, including when repairs were made under warranty." D.I. 34 ¶ 11. "FCA has exclusive knowledge of, and has been in exclusive possession of, information pertaining" to these defects. D.I. 34 ¶ 17. Plaintiffs "reasonably expected that FCA's representations that the Class Vehicles were properly engineered and equipped to handle ordinary, public road driving would be true and complete and would not omit material information." D.I. 34 ¶ 15.

FCA is a Delaware limited liability company (LLC) headquartered in Auburn Hills, Michigan that "designs, manufactures, markets, distributes, services, repairs, sells, and leases" the Class Vehicles "nationwide." D.I. 34 ¶ 156. "FCA provides warranty coverage for Class Vehicles under one or more warranties[,]" such as a "3-year/36,000 mile basic limited warranty and a 5-year/60,000 mile powertrain limited warranty for every vehicle" and "a 7-year/100,000 mile powertrain limited warranty for vehicles which are purchased certified pre-owned." D.I. 34 ¶ 21. FCA's sole member is another Delaware LLC, and that LLC's sole member is Fiat Chrysler Automobiles N.V., "which was incorporated as a public limited liability company" in the Netherlands and is headquartered in the United Kingdom. D.I. 34 ¶ 156. FCA sells the Class Vehicles throughout the United States through a nationwide dealer network, but it sells warranties directly to consumers. D.I. 34 ¶ 159.

Plaintiffs include individuals with the following combinations of car type and citizenship: a California and a Texas citizen with a "certified pre-owned 2015 Jeep Grand Cherokee"; a California, a Texas, a New York, and a New Hampshire citizen each with a "new 2015 Jeep Grand Cherokee"; a Florida citizen with a "new 2015 Jeep Wrangler"; an Alabama citizen with a "new 2014 Jeep Wrangler"; a Massachusetts citizen with a "used 2016 Dodge Ram"; and a Maryland citizen with a "pre-owned 2015 Chrysler Town & Country[.]" D.I. 34 ¶¶ 25-26, 39-40, 52-53, 65-66, 77-78, 89-90, 104-05, 117-18, 130-31, 143-44. Plaintiffs allege that they-and others similarly situated-"overpaid" for the Class Vehicles, "have Vehicles that have significantly diminished resale valuef,]" "have and/or must expend significant money to have their Vehicles (inadequately) repaired[,]" and cannot use their Vehicles for the purposes that FCA advertised. D.I. 34 ¶20.

Plaintiffs filed this class action suit initially on January 28,2022. D.I. 1. After FCA filed a motion to dismiss Plaintiffs' original complaint, D.I. 16, Plaintiffs filed the operative Complaint on May 18, 2022, D.I. 34, and the Court dismissed the prior motion to dismiss as moot, D.I. 57. The Complaint seeks relief under common law fraud and unjust enrichment doctrines; the MMWA; and numerous laws from nine states. D.I. 34 ¶¶ 272-904. FCA argues that Plaintiffs lack standing both to bring claims for vehicles no named plaintiff purchased and to bring a nationwide class action. D.I. 47 at 1-2. FCA also argues that Plaintiffs fail to state a claim for fraud, fraudulent omission, or unjust enrichment. Id. FCA further argues that Plaintiffs' MMWA and state law express and implied warranty claims fail, as do claims under California's Unfair Competition Law ("UCL"). Id. While this case remained in the District of Delaware's judicial vacancy docket, see D.I. 19, Chief Magistrate Judge Thygne granted the parties' stipulation to extend the typical briefing page limits for this Motion, D.I. 45, and then enforced these page limits, D.I. 50. As of October 7, 2022, the parties had begun and intended "to continue their respective discovery efforts, including the production of documents, coordinating the inspections of Plaintiffs' vehicles," and other relevant tasks. D.I. 56 at 1-2.

II. LEGAL STANDARD

A. Lack of Subject Matter Jurisdiction, Rule 12(b)(1)

Once a court's jurisdiction is challenged, it must presume that it lacks jurisdiction unless the party asserting that jurisdiction exists can prove otherwise. G. W. v. Ringwood Bd. of Educ, 28 F.4th 465,468 (3d Cir. 2022); accord Carney v. Adams, 141 S.Ct. 493,499 (2020) ("[Plaintiff] bears the burden of establishing standing as of the time he brought this lawsuit and maintaining it thereafter."). '"Under [Rule] 12(b)(1), a court must grant a motion to dismiss if it lacks subject-matter jurisdiction to hear a claim.'" Shibles v. Bank of Am., N.A., 730 Fed.Appx. 103,105 (3d Cir. 2018) (quoting In re Schering Plough Corp. Intron/Temodar Consumer Class Action, 678 F.3d 235,243 (3d Cir. 2012)) (alteration in original). A motion to dismiss under Rule 12(b)(1) may be a "facial" attack, in which defendants argue that the allegations in the complaint are insufficient to invoke federal jurisdiction, or a "factual" attack, in which defendants question the asserted facts underlying federal court jurisdiction. Davis, 824 F.3d at 346. If a party brings a facial attack, as here, D.I. 47 at 2-5 (reciting facts from the Complaint), the Court must '"consider the allegations of the complaint as true[,]'" Davis, 824 F.3d at 346 (quoting Petruska v. Gannon Univ., 462 F.3d 294, 302 n.3 (3d Cir. 2006)).

The Constitution extends "[t]he judicial Power" only to "Cases" and "Controversies." U.S. Const art. Ill. § 2. Thus, the plaintiff must have "a personal stake in the case-in other words, standing." TransUnion LLC v. Ramirez, 141 S.Ct. 2190, 2203 (2021) (internal quotation marks and citation omitted). '"Absent Article III standing, a federal court does not have subject matter jurisdiction to address a plaintiffs claims, and they must be dismissed.'" Davis, 824 F.3d at 346 (citation omitted). "To establish standing, a plaintiff must show '(i) that he suffered an injury in fact that is concrete, particularized, and actual or imminent; (ii) that the injury was likely caused by the defendant; and (iii) that the injury would likely be redressed by judicial relief.'" Boley v. Universal Health Servs., Inc., 36 F.4th 124, 130-31 (3d Cir. 2022) (quoting TransUnion, 141 S.Ct. at 2203). American Courts traditionally recognize "physical harms and monetary harms" as "providing a basis for a lawsuit . . . ." TransUnion, 141 S.Ct. at 2204. "For an injury to be 'particularized,' it 'must affect the plaintiff in a personal and individual way.'" Spokeo, Inc. v. Robins, 578 U.S. 330, 339 (2016), as revised ...