Flat v. Ford Motor Company

[3] 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA [6] 7 JAMES FLAT, Case No. 23-cv-00725-EMC 8 Plaintiff, ORDER GRANTING DEFENDANT’S 9 v. MOTION FOR JUDGMENT ON THE PLEADINGS 10 FORD MOTOR COMPANY, Docket No. 13 11 Defendant. [13] 14 I. INTRODUCTION 15 On July 28, 2012, Plaintiff purchased a 2012 Ford F-350 vehicle (the “Vehicle”). See 16 Docket No. 1, Ex. A (“Compl.”) ¶ 10. In connection with the purchase, Plaintiff received an 17 express 3-year/36,000 mile bumper-to-bumper warranty and a 5-year/60,000 mile powertrain 18 warranty. Id. ¶ 9; see Docket No. 17 (“Opp’n”) at 1; Docket No. 1, Ex. C (“Sales Contract”). 19 Nearly ten years later, on June 18, 2022, Plaintiff filed a complaint asserting various causes of 20 action against Ford, including breach of express warranty and implied warranty in violation of the 21 Song-Beverly Consumer Warranty Act (“Song-Beverly Act”), Cal. Civ. Code § 1790 , et seq. See 22 Compl. ¶¶ 31–52. 23 Now pending is Ford’s motion for judgment on the pleadings under Federal Rule of Civil 24 Procedure 12(c), in which Ford contends each of Plaintiff’s claims are time-barred by the statute 25 of limitations. See Docket No. 13 (“Mot.”). For the following reasons, the Court GRANTS 26 Ford’s motion to dismiss with leave to amend. 27 II. LEGAL STANDARD 1 pleadings” after the pleadings are closed “but early enough not to delay trial.” A Rule 12(c) 2 motion is “functionally identical” to a Rule 12(b)(6) motion to dismiss for failure to state a claim, 3 and therefore the same legal standard applies. Cafasso v. General Dynamics C4 Sys., Inc., 637 4 F.3d 1047 , 1055 n.4 (9th Cir. 2011). 5 Federal Rule of Civil Procedure 8(a)(2) requires a complaint to include “a short and plain 6 statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A 7 complaint that fails to meet this standard may be dismissed pursuant to Rule 12(b)(6). See Fed. R. 8 Civ. P. 12(b)(6). To overcome a Rule 12(b)(6) motion to dismiss after the Supreme Court's 9 decisions in Ashcroft v. Iqbal, 556 U.S. 662 (2009) and Bell Atlantic Corporation v. Twombly, 550 10 U.S. 544 (2007), a plaintiff’s “factual allegations [in the complaint] ‘must . . . suggest that the 11 claim has at least a plausible chance of success.’” Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th 12 Cir. 2014). The court “accept[s] factual allegations in the complaint as true and construe[s] the 13 pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & 14 Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). But “allegations in a complaint . . . may not 15 simply recite the elements of a cause of action [and] must contain sufficient allegations of 16 underlying facts to give fair notice and to enable the opposing party to defend itself effectively.” 17 Levitt, 765 F.3d at 1135 (quoting Eclectic Props. E., LLC v. Marcus & Millichap Co., 751 F.3d 18 990, 996 (9th Cir. 2014)). “A claim has facial plausibility when the Plaintiff pleads factual 19 content that allows the court to draw the reasonable inference that the Defendant is liable for the 20 misconduct alleged.” Iqbal, 556 U.S. at 678 . “The plausibility standard is not akin to a 21 ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted 22 unlawfully.” Id. (quoting Twombly, 550 U.S. at 556). 23 III. ANALYSIS 24 A. Statute of Limitations 25 Plaintiff brought suit against Ford under the Song-Beverly Act alleging breach of express 26 warranty and the implied warranty of merchantability. The statute of limitations for a violation of 27 warranty is four years. Mexia v. Rinker Boat Co., 174 Cal. App. 4th 1297 , 1305–06 (2009) (citing 1 1. Express Warranty 2 Under § 2725(2), “where a warranty explicitly extends to future performance of the goods, 3 and discovery of the breach must await the time of such performance[,] the cause of action accrues 4 when the breach is or should have been discovered.” Cal. Com. Code § 2725 (2). An express 5 warranty explicitly extends to future performance of goods. The statute of limitations accrues 6 when the breach occurs (which awaits the time of the performance owed) or should have been 7 discovered. 8 Plaintiff took delivery of the Vehicle on June 28, 2012. Plaintiff received an express 39 year/36,000 mile bumper-to-bumper warranty and a 5-year/60,000 mile powertrain warranty upon 10 purchase. As such, Plaintiff’s cause of action under the Song-Beverly Act for violation of the 11 express warranty accrued no later than June 28, 2017, the last day of the powertrain warranty, and 12 the statute of limitations expired four years after occurrence of the breach, i.e., no later than June 13 28, 2021. However, Plaintiff did not initiate this action until May 2022. 14 Plaintiff invokes what has been referred to as the “delayed discovery rule” permitted by § 15 2725(2) which allows for accrual when the breach “should have been discovered.” See, e.g., Mills 16 v. Forestex Co., 108 Cal. App. 4th 625 , 642–643 (2003) (applying the delayed discovery rule 17 based on the future performance exception in Cal. Com. Code § 2725 (2)). Pursuant to the delayed 18 discovery rule, the accrual of a cause of action is postponed until the plaintiff has a “suspicion of 19 one or more of the elements of a cause of action, coupled with knowledge of any remaining 20 elements.” Fox v. Ethicon Endo-Surgery, Inc., 35 Cal. 4th 797, 807 (2005). For the discovery 21 rule to apply, the plaintiff “must specifically plead facts to show (1) the time and manner of 22 discovery and (2) the inability to have made earlier discovery despite reasonable diligence.” Id. at 23 808 (internal citation omitted). 24 Here, while Plaintiff has alleged facts to show the time and manner of discovery, he failed 25 to sufficiently allege an inability to have made discovery during the warranty period despite 26 reasonable diligence. For instance, Plaintiff failed to allege the nature of repairs made to the 27 Vehicle in 2014 and 2016, or any other information explaining why he was unable to then 1 2. Implied Warranty 2 Typically, a breach of the implied warranty of merchantability occurs at the date of sale. 3 Cardinal Health 301, Inc. v. Tyco Elecs. Corp., 169 Cal. App. 4th 116, 134 (2008). However, the 4 Song-Beverly Act provides that the “duration of the implied warranty of merchantability and 5 where present the implied warranty of fitness shall be coextensive in duration with an express 6 warranty . . . but in no event . . . have a duration of less than 60 days nor more than one year 7 following the sale of new consumer goods to a retail buyer.” Cal. Civ. Code § 1791.1 (c). In 8 Mexia, a California Court of Appeal determined that the durational limit in section 1791.1(c) has 9 the effect of explicitly extending the implied warranty to future performance. 174 Cal. App. 4th at 10 1310 (applying the future performance exception in Cal. Com. Code § 2725 (2) to the implied 11 warranty of merchantability). Therefore, Mexia concluded that the implied warranty of 12 merchantability may be breached by a latent defect undiscoverable at the time of sale but must 13 occur no later than the durational limit set forth in Section 1791.1(c). Id. at 1308 . 14 Here, the express warranty was five years, and thus the implied warranty is extended to the 15 outer limit of one year per 1791.1(c). As such, any breach of the warranty must have occurred on 16 or before June 28, 2013, whether Plaintiff discovered the breach within that warranty period or 17 after. Hence, the limitations period on the implied warranty claim would normally accrue no later 18 than June 28, 2013, and the limitations period would have run by 2017, four years later. However, 19 Plaintiff argues that the delayed discovery rule should apply to the implied warranty claim just as 20 it does to the express warranty claim. Courts in this district are split on whether the delayed 21 discovery rule applies to implied warranty claims. Compare Clenney v. FCA US LLC, No. 2222 CV-00547-VC, 2022 WL 2197074 , at *2 (N.D. Cal. June 20, 2022) (“[T]he statute of limitations 23 for implied warranty claims does not run at tender. It runs at discovery.”), with Covarrubias v. 24 Ford Motor Co., No. 19-CV-01832-EMC, 2019 WL 2866046 , at *3 (N.D. Cal. July 3, 2019) 25 (concluding the delayed discovery rule is inapplicable to implied warranty claims). The Court 26 need not decide this issue now, because for the reasons stated above, Plaintiff has failed to allege 27 facts sufficient to invoke the delayed discovery rule. 1 IV. CONCLUSION 2 Therefore, the Court GRANTS Ford’s motion for judgment on the pleadings and dismisses 3 the case with leave to amend to allow Plaintiff to allege with specificity delayed discovery. The 4 amended complaint shall be filed within thirty (30) days from the date of this order. 5 This order disposes of Docket No. 13. [6] 7 IT IS SO ORDERED. [8] 9 Dated: June 21, 2023 [10] 11 ______________________________________ EDWARD M. CHEN 12 United States District Judge