Siafarikas v. Mercedes-Benz USA, LLC ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 DIMITRIOS SIAFARIKAS, an No. 2:20-cv-01784-JAM-AC individual, 12 Plaintiff, 13 ORDER GRANTING DEFENDANT’S v. MOTION FOR JUDGMENT ON THE 14 PLEADINGS MERCEDES-BENZ USA, LLC, a 15 Delaware Limited Liability Company. 16 Defendant. 17 18 On May 18, 2020, Dimitrios Siafarikas (“Plaintiff”) filed 19 this lawsuit against Mercedes-Benz USA, LLC (“Defendant”) in the 20 Sacramento County Superior Court. See Not. of Removal ¶ 1, ECF 21 No. 1. Defendant removed the case to federal court, invoking 22 this Court’s diversity jurisdiction. Id. ¶ 7. Alleging the 2017 23 Mercedes-Benz C300C he purchased in January 2020 had various 24 defects, Plaintiff brings three claims against Defendant: 25 (1) breach of implied warranty of merchantability under the Song- 26 Beverly Warranty Act; (2) breach of express warranty under the 27 Song-Beverly Warranty Act; and (3) fraudulent inducement – 28 concealment. See generally Compl., Ex. B to Not. of Removal, ECF 1 No. 1-3. The alleged defects include “air conditioning [with a] 2 strong bad smell, strong fuel odor, acceleration issues, radio 3 malfunction, inoperable window, and defective cargo net clip.” 4 Id. ¶ 10. For these defects, Plaintiff seeks monetary relief, 5 including punitive damages. Id. at 10. 6 Before the Court is Defendant’s motion for judgment on the 7 pleadings as to Plaintiff’s fraudulent concealment claim and his 8 punitive damages claim. See Mot. for J. on the Pleadings 9 (“Mot.”), ECF No. 7. Plaintiff filed an opposition. See Opp’n, 10 ECF No. 9. Defendant did not file a reply. For the reasons set 11 forth below, the Court GRANTS Defendant’s motion.1 12 13 I. OPINION 14 A. Request for Judicial Notice 15 Defendant requests the Court take judicial notice of an 16 order from the District Court for the Central District of 17 California. See Def.’ RFJN, ECF No. 8. A court may take 18 judicial notice of matters of court records in another case. 19 U.S. v. Howard, 381 F.3d 873, 876 n.1 (9th Cir. 2004). 20 Accordingly, Defendant’s request is granted. However, the Court 21 takes judicial notice only of the existence of this document and 22 declines to take judicial notice of its substance, including any 23 disputed or irrelevant facts therein. See Lee v. City of Los 24 Angeles, 250 F.3d 668, 690 (9th Cir. 2001). 25 /// 26 27 1 This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was 28 scheduled for August 10, 2021. 1 B. Legal Standard 2 A party may move for judgment on the pleadings “[a]fter the 3 pleadings are closed — but early enough not to delay trial.” 4 Fed. R. Civ. P. 12(c). “Rule 12(c) is ‘functionally identical’ 5 to Rule 12(b)(6) and . . . ‘the same standard of review’ applies 6 to motions brought under either rule.” Cafasso, U.S. ex rel. v. 7 Gen. Dynamic C4 Sys., Inc., 637 F.3d 1047, 1054 n.4 (9th Cir. 8 2011). Thus, in deciding whether to dismiss a claim the court 9 considers “whether the complaint’s factual allegations, together 10 with all reasonable inferences, state a plausible claim for 11 relief.” Id. at 1054. 12 Additionally, the more stringent pleading requirements of 13 Federal Rule of Civil Procedure 9(b) apply to allegations of 14 fraud. Fed. R. Civ. P. 9(b). “In alleging fraud or mistake, a 15 party must state with particularity the circumstances 16 constituting fraud or mistake. Malice, intent, knowledge, and 17 other conditions of a person's mind may be alleged generally.” 18 Id. 19 C. Analysis 20 Defendant’s leading argument as to why Plaintiff’s 21 fraudulent concealment claim should be dismissed is that 22 Plaintiff did not plead his fraudulent concealment claim with the 23 requisite particularity under Rule 9(b). Mot. at 5-9. As 24 Defendant summarizes: “Plaintiff’s third cause of action consists 25 of nothing more than conclusory statements parroting the legal 26 elements of the claim, but not a single allegation is sufficient 27 to meet their burden to plead facts with particularity.” Id. at 28 3. Plaintiff counters first that the sufficiency of his 1 fraudulent concealment claim must be measured against the 2 requirements of California law rather than Rule 9(b)’s pleading 3 standard. See Opp’n at 2-3, 5-7. Specifically, Plaintiff 4 contends that California law recognizes a distinction between 5 fraudulent concealment claims and generic fraud claims, and less 6 specificity in pleading is required for fraudulent concealment 7 claims. Opp’n at 2. The Ninth Circuit, however, has clearly 8 stated otherwise: “It is well-settled that the Federal Rules of 9 Civil Procedure apply in federal court, irrespective of the 10 source of the subject matter jurisdiction, and irrespective of 11 whether the substantive law at issue is state or federal. While 12 a federal court will examine state law to determine whether the 13 elements of fraud have been pled sufficiently to state a cause of 14 action, the Rule 9(b) requirement that the circumstances of the 15 fraud must be stated with particularity is a federally imposed 16 rule.” Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 17 2009) (internal citations and quotation marks omitted). Under 18 Kearns, Rule 9(b) clearly applies to Plaintiff’s fraudulent 19 concealment claim. 20 “Rule 9(b) demands that the circumstances constituting the 21 alleged fraud ‘be specific enough to give defendants notice of 22 the particular misconduct ... so they can defend against the 23 charge and not just deny that they have done anything wrong.’” 24 Kearns, 567 F.3d at 1124 (internal citations omitted). As 25 explained below, Plaintiff’s allegations in support of his 26 fraudulent concealment claim fall well short of what is required 27 under Rule 9(b). See Compl. ¶¶ 4-6, 9-11, 36-38, 40-41; see also 28 Opp’n at 3-4 (referring the Court to these paragraphs). 1 The elements for a fraudulent concealment claim are: “(1) 2 the defendant must have concealed or suppressed a material fact, 3 (2) the defendant must have been under a duty to disclose the 4 fact to the plaintiff; (3) the defendant must have intentionally 5 concealed or suppressed the fact with the intent to defraud the 6 plaintiff; (4) the plaintiff must have been unaware of the fact 7 and would not have acted as he did if he had known of the 8 concealed or suppressed fact; and (5) as a result of the 9 concealment or suppression of the fact, the plaintiff must have 10 sustained damage.’” SCC Acquisitions, Inc. v. Cent. Pac. Bank, 11 207 Cal.App.4th 859, 864 (2012)(internal citations omitted). 12 Reviewing the complaint, the Court finds no facts supporting any 13 of these elements. See generally Compl. For example, Paragraph 14 36 states: “Prior to Plaintiff’s purchase of the Subject Vehicle, 15 Defendant was well-aware of the non-conformities and defects 16 related to the air conditioning system. In particular, Defendant 17 had knowledge that the air conditioning system contained a defect 18 or defects which resulted in malodorous odors emanating from the 19 air conditioning system. Despite this advance knowledge of which 20 only defendant could know, Defendant still introduced the subject 21 vehicle into the stream of commerce, which eventually led to 22 Plaintiff purchasing the vehicle. Plaintiff had no way of knowing 23 this information related to the air conditioning defect and 24 [Defendant] and its authorized retailers and distributors of 25 vehicles including the subject vehicle intentionally failed to 26 disclose this information to Plaintiff.” This paragraph, which 27 exemplifies the rest of the complaint, is conclusory, unsupported 28 with facts, and plainly insufficient. See Ashcroft v. Iqbal, 556 1 U.S. 662, 679 (2009). 2 Because Plaintiff’s complaint contains nothing but bare 3 legal conclusions unsupported with facts, Plaintiff fails to 4 state a fraudulent concealment claim. Accordingly, Plaintiff’s 5 fraudulent concealment claim is dismissed. Because the Court 6 dismisses on these grounds, the Court need not reach Defendant’s 7 additional argument that even if Plaintiff had met the heightened 8 Rule 9(b) standard, his fraud claim is barred by the economic 9 loss rule. See Mot. at 9-11. 10 Lastly, Defendant contends that if the Court dismisses 11 Plaintiff’s fraudulent concealment claim, it must also dismiss 12 his punitive damages claim because the fraudulent concealment 13 claim is the only cause of action that can support a request for 14 punitive damages. Mot. at 11. That is, Plaintiff’s remaining 15 claims under the Song-Beverly Act do not permit recovery of 16 punitive damages. Id. (citing to Troensegaard v. Silvercrest 17 Industries, Inc., 175 Cal.App.3d 218, 228 (1985)). In 18 opposition, Plaintiff does not address this argument. See Opp’n 19 at 13-14. Significantly, at no point does he contend that his 20 Song-Beverly claims can support such a request. Id. 21 Accordingly, because the fraudulent concealment claim has been 22 dismissed, Plaintiff’s punitive damages claim must also be 23 dismissed. 24 D. Leave to Amend 25 Courts dismissing claims under Federal Rule of Civil 26 Procedure 12(b) have discretion to permit amendment, and there is 27 a strong presumption in favor of leave to amend. Lopez v. Smith, 28 203 F.3d 1122, 1130 (9th Cir. 2000). “A district court should eee mE ROS RI EO EI OS IED ESO 1 grant leave to amend even if no request to amend the pleading was 2 made, unless it determines that the pleading could not possibly 3 be cured by the allegation of other facts.” Id. (internal 4 citation omitted). Accordingly, the Court grants Plaintiff one 5 final opportunity to rectify the deficiencies identified above 6 | and to file an amended complaint, if he so chooses. 7 8 Il. ORDER 9 For the reasons set forth above, the Court GRANTS 10 Defendant’s Motion for Judgment on the Pleadings. If Plaintiff 11 elects to amend his complaint, he shall file a First Amended 12 Complaint within twenty days (20) of this order. Defendant’s 13 responsive pleading is due twenty days thereafter. 14 IT IS SO ORDERED. 15 Dated: September 10, 2021 16 kA 17 teiren staves odermacr 7008 18 19 20 21 22 23 24 25 26 27 28