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Rasnic v. FCA US LLC

United States District Court, D. Kansas

December 15, 2017

LAWRENCE RASNIC, et al., Plaintiffs,
v.
FCA U.S. LLC f/k/a CHRYSTLER GROUP LLC, Defendant.

          MEMORANDUM AND ORDER

          Kathryn H. Vratil United States District Judge

         On March 31, 2017, plaintiffs filed their First Amended Class Action Complaint (Doc. #23). Plaintiffs allege that the cars which defendant manufactures have defective dashboard touchscreens which black out and affect drivers' ability to control radio, climate control and navigation systems. See generally id. In particular, plaintiffs assert violations of the Magnuson-Moss Warranty Act (“MMWA”), 15 U.S.C. 2301 et seq., (Claim 1); a state law claim for breach of the implied warranty of merchantability (Claim 2) and violations of the Kansas Consumer Protection Act (“KCPA”), Kan. Stat. Ann. § 50-623 et seq., (Claim 3). Id. This matter comes before the Court on FCA U.S. LLC's Motion To Dismiss First Amended Complaint, Or, Alternatively, To Strike Nationwide Class Allegations (Doc. #30) filed April 24, 2017. For reasons below, the Court sustains defendant's motion in part.

         Legal Standard

         In ruling on a motion to dismiss under Rule 12(b)(6), Fed. R. Civ. P., the Court assumes as true all well-pleaded factual allegations and determines whether they plausibly give rise to an entitlement of relief. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). To survive a motion to dismiss, a complaint must contain sufficient factual matter to state a claim which is plausible - not merely conceivable - on its face. Id. at 679-80; Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In determining whether a complaint states a plausible claim for relief, the Court draws on its judicial experience and common sense. Iqbal, 556 U.S. at 679. The Court need not accept as true those allegations which state only legal conclusions. See id.

         Plaintiffs bear the burden of framing their claim with enough factual matter to suggest that they are entitled to relief; it is not enough to make threadbare recitals of a cause of action accompanied by conclusory statements. See Twombly, 550 U.S. at 556. Plaintiffs make a facially plausible claim by pleading factual content from which the Court can reasonably infer that defendant is liable for the misconduct alleged. Iqbal, 556 U.S. at 678. Plaintiffs must show more than a sheer possibility that defendant has acted unlawfully - it is not enough to plead facts that are “merely consistent with” defendant's liability. Id. (quoting Twombly, 550 U.S. at 557). A pleading which offers labels and conclusions, a formulaic recitation of the elements of a cause of action or naked assertions devoid of further factual enhancement will not stand. Iqbal, 556 U.S. at 678. Similarly, where the well-pleaded facts do not permit the Court to infer more than the mere possibility of misconduct, the pleading has alleged - but has not “shown” - that the pleader is entitled to relief. See id. at 679. The degree of specificity necessary to establish plausibility and fair notice depends on context because what constitutes fair notice under Rule 8(a)(2), Fed. R. Civ. P., depends on the type of case. Robbins v. Oklahoma, 519 F.3d 1242, 1248 (10th Cir. 2008) (citing Phillips v. Allegheny, 515 F.3d 224, 232-33 (3d Cir. 2008)).

         Procedural And Factual Background

         Lawrence Rasnic and Rebeca Lopez-Rasnic are Kansas residents. First Amended Class Action Complaint (Doc. #23), ¶¶ 13-14. FCA U.S. LLC (formerly known as Chrysler) is a Delaware limited liability company that manufactures cars. Id., ¶ 16. Highly summarized, plaintiffs allege the following.

         On June 17, 2013, plaintiffs purchased a 2013 Dodge Dart - a car that defendant manufactured. Id., ¶ 88. Plaintiffs' car came with a “Uconnect” infotainment system and a Basic Limited Warranty. Id., ¶¶ 90-91. The Basic Limited Warranty extended until the car reached 36, 000 miles or three years from the date of purchase, whichever was earlier. Id., ¶ 92. It “cover[ed] the cost of all parts and labor needed to repair any item on [the] vehicle . . . that [was] defective in material, workmanship or factory preparation.” Id., ¶ 92, Ex. A at 5.

         The Uconnect system allows drivers to control radio, navigation, remote locking, climate control and other features from a touchscreen on the car's dashboard. Id., ¶¶ 19-30. Consumers can purchase this optional feature for Dodge cars which are model years from 2013 through 2016. Id., ¶¶ 28, 32-38. Defendant featured its Uconnect system in many advertisements and maintained a web site to educate consumers about the infotainment system. Id., ¶¶ 38-64. Plaintiffs do not allege that before purchasing their car, they had seen or heard defendant's advertisements or visited its web site.

         In approximately April of 2016, plaintiffs' Uconnect system began to freeze and then shut off, leaving a blank, black screen which did not function. Id., ¶¶ 95-98. On April 23, 2016, plaintiffs took their car to a service dealership for repair. Id., ¶ 99. At this time, the warranty had not expired. Id. The dealership could not repair the system, however, it replaced the Uconnect system on May 14, 2016. Id., ¶¶ 102-04. That same day, the replacement system began to randomly black out. Id., ¶ 105. On June 1, 2016, the dealership replaced the system's module; after this, the screen began to flash back and forth from black to white. Id., ¶¶ 105-107. On June 30, 2016, defendant's specialist said that he had fixed the car, but the screen blacked out again when plaintiffs picked it up. Id., ¶¶ 108-114. In early July, the dealership again replaced the Uconnect, but the new system developed expanded issues. Id., ¶¶ 117-121. The malfunctions prevented plaintiffs from controlling their heating, air conditioning and navigation. Id. Throughout the next few months, the problems persisted as the dealership and defendant tried and failed to repair the Uconnect system three more times. Id., ¶¶ 122-150.

         Since 2013, defendant has issued 45 Technical Service Bulletins (“TSBs”) to authorized technicians. Id., ¶¶ 3-4. TSBs are instructions on how to repair known defects, and they include a disclaimer prohibiting public dissemination. Id. Plaintiffs allege that three TSBs concerned the Uconnect in their car. Id., ¶¶ 79-84. Defendant issued its first Uconnect-related TSB in July of 2014. Id., ¶ 79.

         On January 12, 2017, plaintiffs filed a class action complaint against defendant in the 29th Judicial District of Kansas, Wyandotte County. Notice Of Removal (Doc. #1), ¶ 1. On February 2, 2017, defendant removed the case to this Court. See Doc. #1. On March 31, 2017, plaintiffs filed an amended complaint. First Amended Class Action Complaint (Doc. #23). Plaintiffs assert that by providing defective Uconnect systems, defendant violated the MMWA (Claim 1), the implied warranty of merchantability (Claim 2), and the KCPA (Claim 3). See id., ¶¶ 191-232. Plaintiffs propose to represent statewide and/or national classes of individuals who purchased or leased cars with an 8.4-inch Uconnect infotainment system on or after January 12, 2013. Id., ¶¶ 181.

         Analysis

         Defendant seeks dismissal of plaintiffs' claims under Rule 12(b)(6), Fed. R. Civ. P., or alternatively, to strike nationwide class allegations. Motion To Dismiss (Doc. #30). First, defendant asserts that the Court should dismiss all of plaintiffs' claims because they fail to allege a “specific defect.” FCA U.S. LLC's Memorandum In Support Of Its Motion To Dismiss First Amended Class Action Complaint, Or, Alternatively, To Strike Nationwide Class Allegations (Doc. #31) filed April 24, 2017 at 6-8. Second, defendant contends that plaintiffs' MMWA claim fails because they did not allege breach of an express warranty. Id. at 8-11. Third, defendant argues that the alleged Uconnect malfunctions do not breach the Kansas implied warranty of merchantability. Id. at 11-13. Fourth, defendant seeks dismissal of the KCPA claim because plaintiffs filed it after the statute of limitations had expired and fail to allege the necessary elements of a valid claim. Id. at 13-23. Defendant also asks the Court to strike all nationwide allegations because plaintiffs base their claims on Kansas law, which cannot govern out-of-state transactions. Id. at 23-24.

         I. Failure To Plead A Specific Defect (Claims 1-3)

         Defendant asserts that the Court should dismiss all of plaintiffs' claims because they fail to adequately identify “a specific defect.” Id. at 7 (quoting Samarah v. Danek Med., Inc., 70 F.Supp.2d 1196, 1202 (D. Kan. 1999)). In particular, defendant claims that it cannot properly begin to form its defense because plaintiffs fail to provide adequate notice of the alleged defect in the Uconnect systems. Id. at 6-8.

         Plaintiffs allege that defendant's Uconnect system would “randomly black out, ” “freeze and then shut off, leaving a blank, black screen, ” “flash back and forth from black to white” and that these malfunctions affected control of “the [h]eating, [a]ir [c]onditioning, and [n]avigation.” First Amended Class Action Complaint (Doc. #23), ¶¶ 95, 98, 108, 121. Although these allegations do not identify the cause of these issues, they give defendant fair notice of the grounds upon which plaintiffs' claims rest. See Erickson v. Pardus, 551 U.S. 89, 93 (2007) (pleadings “need only give the defendant fair notice of what the claim is and the grounds upon which it rests”); see also Burnett v. Mortg. Elec. Registration Sys., 706 F.3d 1231, 1235 (10th Cir. 2013) (plaintiff only needs to give fair notice of claim). Because Rule 8, Fed. R. Civ. P., only requires fair notice, plaintiffs do not need to identify the cause of a “specific defect” in their complaint. Id. Defendant attempts to heighten plaintiffs' burden of pleading by relying on inapposite cases which discuss motions for summary judgment and motions to compel, not Rule 12(b)(6) motions, Fed.R.Civ.P. See Memorandum In Support (Doc. #31) at 7 (citing Samarah, 70 F.Supp.2d at 1202); see also FCA U.S. LLC's Reply In Support Of Its Motion To Dismiss First Amended Class Action Complaint, Or, Alternatively, To Strike Nationwide Allegations (Doc. #33) filed May 30, 2017 at 3 (citing McGee v. Hayes, 43 Fed.Appx. 214, 217 (10th Cir. 2002); Turney v. DZ Bank AG Deutsche Zentral Genossenschaftsbank, No. 09-2533-JWL, 2011 WL 1375587, at *4 (D. Kan. Apr. 12, 2011)). Plaintiffs' allegations provide defendant sufficient notice of the purported defect. The Court overrules defendant's motion on this ground.

         II. Magnuson-Moss Warranty Act, 15 U.S.C. 2301 et seq., (Claim 1)

         Defendant argues that plaintiffs fail to allege sufficient facts to support a claim under the MMWA because they do not allege breach of an express warranty - a necessary element of MMWA claims. Memorandum In Support (Doc. #31) at 8-11. Plaintiffs' warranty covered “the cost of all parts and labor needed to repair” the vehicle if anything was “defective in material, workmanship or factory preparation.” Id. at 9 (quoting Basic Limited Warranty).[1] Defendant asserts that “it is universally recognized” that material and workmanship warranties like the Basic Limited Warranty do not cover design defects. Id. Thus, defendant contends that plaintiffs' alleged Uconnect defect cannot breach the warranty.

         Viewing the facts in the light most favorable to plaintiffs, the Court finds that they sufficiently allege that defendant breached the warranty by failing to adequately repair the car. Plaintiff's Opposition To FCA U.S. LLC's Motion To Dismiss The First Amended Complaint (Doc. #32) filed May 15, 2017 at 7. The Kansas Supreme Court has stated that agreements similar to plaintiffs' warranty guarantee repairs and replacement of defective parts - not “performance without malfunction during the term of the warranty.” See Voth v. Chrysler Motor Corp., 218 Kan. 644, 648, 545 P.2d 371, 375 (1976). Plaintiffs' amended complaint alleges approximately nine instances where defendant's vehicle service location failed to fix their Uconnect system. First Amended Class Action Complaint (Doc. #23), ¶¶ 99-153 (multiple instances occurred before warranty expired). Thus, they adequately allege that defendant breached the warranty by failing to repair plaintiffs' defective Uconnect system.

         Further, defendant fails to establish that, as a matter of Kansas law, material and workmanship warranties exclude design defects. Reply (Doc. #33) at 6. Again, defendant relies on inapposite authority when stating that “it is universally recognized that defects in design are not covered by material and workmanship warranties.” Memorandum In Support (Doc. #31) at 9.[2] To prove Kansas law, defendant cites an unpublished Ninth Circuit case applying California law, an order from the Southern District of New York applying New York law and an order from the District of New Jersey deciding a motion for summary judgment under Pennsylvania law. See id. at 9-10. These cases do not reflect the relevant Kansas law. Id. at 9.

         Finally, when deciding a Rule 12(b)(6) motion, the Court does not “weigh potential evidence that the parties might present at trial.” Jacobsen, 287 F.3d at 941. At this early stage of the proceedings, the Court cannot resolve questions of fact concerning what caused the Uconnect malfunctions and whether the warranty ...


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