Melnick v. Tamko Bldg. Prods., Inc.

469 F.Supp.3d 1082

Martin and Beth MELNICK; Lia Louthan; and Summerfield Gardens Condominium, on behalf of themselves and all others similarly situated, Plaintiffs,

v.TAMKO BUILDING PRODUCTS, INC., Defendant.

Case No. 19-2630-JWL

United States District Court, D. Kansas.

Signed June 26, 2020

Andrew Funk, Funk Riemann LLP, Kansas City, MO, Charles E. Schaffer, Pro Hac Vice, Levin Sedran & Berman, LLP, Jacob M. Polakoff, Pro Hac Vice, Lawrence Deutsch, Pro Hac Vice, Berger Montague, PC, Philadelphia, PA, for Plaintiff Martin Melnick.

Andrew Funk, Funk Riemann, LLP, Kansas City, MO, Charles E. Schaffer, Pro Hac Vice, Levin Sedran & Berman, LLP, Jacob M. Polakoff, Pro Hac Vice, Lawrence Deutsch, Pro Hac Vice, Berger Montague, PC, Philadelphia, PA, for Plaintiffs Beth Melnick, Lia Louthan, Summerfield Gardens Condominium.

Jessica D. Miller, Pro Hac Vice, Skadden Arps Slate Meagher & Flom, LLP, Washington, DC, Kara Trouslot Stubbs, Baker, Sterchi, Cowden & Rice, LLC, Kansas City, MO, Richard T. Bernardo, Pro Hac Vice, Skadden Arps Slate Meagher & Flom, LLP, New York, NY, for Defendant.

MEMORANDUM AND ORDER

John W. Lungstrum, United States District Judge Three sets of plaintiffs assert claims against defendant TAMKO Building Products, Inc. ("TAMKO") arising out of its sale of roofing shingles that plaintiffs allege were defective. This matter presently comes before the Court on TAMKO's motion to dismiss most of plaintiffs’ claims (Doc. # 113). As more fully set forth herein, the motion is granted in part and denied in part . The motion is granted with respect to the following claims for each set of plaintiffs:

Martin and Beth Melnick:

Fraudulent nondisclosure (Count X) (leave to amend);

CPLA (Count XVI) (leave to amend);

CUTPA (Count XVII).

Lia Louthan:

Breach of express warranty (Count I) to the extent based on warranties other than those contained in TAMKO's limited warranty and in the brochure on which she relied (leave to amend);

Breach of the implied warranty of fitness for a particular purpose (Count III);

Unjust enrichment (Count IX);

Fraudulent concealment (Count X) (leave to amend);

Negligent misrepresentation (Count XI);

OPLA (Count XVIII);

OCSPA (Count XIX) claims for damages other than the claim based on a 2015 violation concerning the rejection of the warranty claim.

Summerfield Gardens Condominium:

Breach of express warranty (Count I);

Breach of implied warranties (Counts II and III);

Strict Liability (Counts IV, V, and VI) (leave to amend);

Negligence (Counts VII and VIII) (leave to amend);

Fraudulent concealment (Count X) (leave to amend);

Negligent misrepresentation (Count XI) (leave to amend);

ICFA (Count XX) (leave to amend for one alleged violation).

Those claims are hereby dismissed. Plaintiffs are granted leave to amend their complaint, on or before July 15, 2020 , with respect to certain claims as indicated above and to the extent allowed below. The motion is otherwise denied.

I. Background

In this putative class action, four individual plaintiffs – a married couple, an individual, and a corporation – assert claims against TAMKO based on their allegations that roofing shingles manufactured by TAMKO were defective. Plaintiffs Martin and Beth Melnick allege that they installed TAMKO's shingles on their house in Connecticut in September 2002; that the shingles failed, leading to damage in 2013 through 2015; that they initiated a warranty claim with TAMKO in December 2014; and that TAMKO denied their warranty claim in March 2015. Plaintiff Lia Louthan alleges that TAMKO'S shingles were installed on her house in Ohio in September 2004; that the shingles failed and caused damage; and that in November 2015, her husband contacted TAMKO to file a warranty claim, but that TAMKO refused to allow the claim to be filed. Plaintiff Summerfield Gardens Condominium ("Summerfield") alleges that TAMKO's shingles were installed on its 20 duplex buildings in Illinois during construction in 2003; that the failure of the shingles caused damage; that in 2014 Summerfield filed a warranty claim with TAMKO for the shingles on one half of one building; that TAMKO provided Summerfield with a prorated number of replacement shingles (22 out of 33 shingles) in response to the warranty claim; and that Summerfield replaced the roofs on some of the other buildings.

The present suit was filed against TAMKO by the Melnicks and by Jeffrey Snyder, a California resident, on December 18, 2015, in the United States District Court for the Eastern District of California. On May 6, 2016, plaintiffs filed an amended complaint in which Ms. Louthan and Summerfield were added as named plaintiffs. On September 30, 2019, the California court granted TAMKO's motion to dismiss the claims asserted by plaintiff Snyder. Because venue no longer existed in that court after dismissal of the California plaintiff's claims, the case was transferred to this Court on October 15, 2019, by stipulation of the parties.¹ A new scheduling order was issued on January 31, 2020, and TAMKO filed the instant motion to dismiss on February 4, 2020.

By their amended complaint, plaintiffs assert various common-law and statutory claims. Plaintiffs Louthan and Summerfield assert claims for breach of express warranty (Count I), breach of implied warranty (Counts II and III), strict product liability (Counts IV, V, and VI), negligence (Counts VII and VIII), and negligent misrepresentation (Count XI). All three sets of plaintiffs assert claims for unjust enrichment (Count IX) and fraudulent concealment (Count X). Plaintiffs also assert claims under the following statutes: the Melnicks, under the Connecticut Product Liability Act (CPLA) and the Connecticut Unfair Trade Practices Act (CUTPA) (Counts XVI and XVII); Ms. Louthan, under the Ohio Product Liability Act (OPLA) and the Ohio Consumer Sales Protection Act (OCSPA) (Counts XVIII and XIX); and Summerfield, under the Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA) (Count XX). All plaintiffs also seek declaratory judgments and injunctive relief (Counts XXI and XXII). Finally, plaintiffs’ complaint asserts putative claims on behalf of a nationwide class and state-wide classes for residents of Connecticut, Ohio, and Illinois.

II. Governing Standard

The Court will dismiss a cause of action for failure to state a claim under Fed. R. Civ. P. 12(b)(6) only when the factual allegations fail to "state a claim to relief that is plausible on its face," see Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), or when an issue of law is dispositive, see Neitzke v. Williams , 490 U.S. 319, 326, 109 S.Ct. 1827, 104 L.Ed.2d 338 (1989). The complaint need not contain detailed factual allegations, but a plaintiff's obligation to provide the grounds of entitlement to relief requires more than labels and conclusions; a formulaic recitation of the elements of a cause of action will not do. See Bell Atlantic , 550 U.S. at 555, 127 S.Ct. 1955. The Court must accept the facts alleged in the complaint as true, even if doubtful in fact, see id. , and view all reasonable inferences from those facts in favor of the plaintiff, see Tal v. Hogan , 453 F.3d 1244, 1252 (10th Cir. 2006).

III. The Melnicks’ Claims under Connecticut Law

A. CUTPA Claim (Count XVII)

In Count XVII of the amended complaint, the Melnicks assert a claim against TAMKO under the Connecticut Unfair Trade Practices Act (CUTPA), Conn. Gen. Stat. §§ 42-110a et seq.² The Melnicks allege that TAMKO engaged in deceptive business practices prohibited by CUTPA by failing to disclose and by concealing that its shingles were defective and would fail prematurely.

TAMKO argues that this claim is barred by CUTPA's statute of limitations, which states that an action under the statute "may not be brought more than three years after the occurrence of a violation." See id. § 42-110g(f). TAMKO argues that any violation relating to the Melnicks’ shingles occurred before or at the time the shingles were installed. The Melnicks allege that the shingles were installed on their home in September 2002, and this action was filed in December 2015.

The Melnicks’ first response to this argument is that "[t]he basis for the Melnicks’ CUTPA claim is when Defendant lied to the Melnicks in denying their warranty claim" in 2015. The problem with this position is that the Melnicks have alleged no such violation. In this count, the Melnicks have alleged that TAMKO violated CUTPA by failing to disclose and concealing that the shingles were defective and would prematurely fail, by making false or misleading statements about the shingles, and by failing to warn about the defects; that these acts deceived the Melnicks about the true performance and characteristics of the shingles; and that as a result, the Melnicks paid a premium for the shingles, and the shingles have caused the value of their home to decrease. Nowhere in this count have the Melnicks cited any violations relating to the denial of their warranty claim, long after the installation of the shingles and after the Melnicks suffered the alleged damage in the form of an increased price and a devalued home. Nor have the Melnicks alleged anywhere in the complaint that the denial involved any misrepresentations, as they allege only that the denial contained "several dubious assertions."

Moreover, under Connecticut law, the exclusivity provision of the Connecticut Product Liability Act (CPLA) precludes other claims, including warranty claims, against a product seller for harm caused by a product. See Conn. Gen. Stat. § 52-572n. Thus, plaintiffs could not bring a claim under CUTPA for property damage caused by a product, but they could use CUTPA to redress a purely financial injury, such as being forced to pay a higher price for the product. See Gerrity v. R.J. Reynolds Tobacco Co. , 263 Conn. 120, 818 A.2d 769, 775-76 (2003). Thus, a claim under CUTPA that TAMKO wrongfully denied the Melnicks’ warranty claim would be barred by...