Key v. BMW of North America, LLC ( 2020 )

1 2 3 4 IN THE UNITED STATES DISTRICT COURT 5 FOR THE NORTHERN DISTRICT OF CALIFORNIA 6 7 GRETCHEN KEY, Case No. 19-cv-03366-MMC 8 Plaintiff, ORDER GRANTING DEFENDANT'S MOTION TO DISMISS FIRST 9 v. AMENDED COMPLAINT; AFFORDING PLAINTIFF LEAVE TO AMEND; 10 BMW OF NORTH AMERICA, LLC, CONTINUING CASE MANAGEMENT CONFERENCE Defendant. 11 12 13 Before the Court is defendant BMW of North America, LLC's ("BMW") "Motion to 14 Dismiss Plaintiff Gretchen Key's First Amended Class Action Complaint Pursuant to Fed. 15 R. Civ. P. 12(B)(6)," filed October 14, 2019. Plaintiff Gretchen Key ("Key") has filed 16 opposition, to which BMW has replied. Having read and considered the papers filed in 17 support of and in opposition to the motion, the Court rules as follows.1 18 BACKGROUND 19 In the operative complaint, the First Amended Complaint ("FAC"), Key alleges the 20 following, which, for purposes of the instant motion, the Court assumes true. 21 BWM vehicles are "equipped with onboard diagnostic and data gathering 22 equipment" that "gathers data from numerous data points and sensors" in the vehicles. 23 (See FAC ¶ 8.) BMW "distributes to its dealerships diagnostic software and vehicle 24 interface equipment" that are used by dealerships to "extract data" from vehicles, which 25 data dealerships use "primarily" to "diagnos[e] the root cause of vehicle malfunctions and 26 vehicle defects." (See FAC ¶ 9.) Data extracted by dealerships is "forwarded" to BMW, 27 1 which data BMW "collects and archives." (See FAC ¶ 10.) 2 Key owns a 2008 BMW 750LI. (See FAC ¶ 35.) In December 2017, BMW 3 published a "safety recall," in which it "offered to fix a problem with the electric door latch 4 which could cause the latch to unexpectedly open while driving." (See FAC ¶ 36.) In 5 July 2018, Key took her vehicle to Weatherford BMW for the "repairs set forth in the 6 recall" and Weatherford BMW performed such repairs (see FAC ¶ 37); in so doing, 7 Weatherford BMW "extracted diagnostic data" from the vehicle (see FAC ¶ 2). 8 After the recall work was performed, Key "experienced a series of additional 9 problems with the vehicle" (see FAC ¶ 2), and, on four occasions, took her vehicle to 10 Weatherford BMW "complaining" about such problems, which she identified on those 11 occasions as, respectively, "problems with the airbag light and driver's side power 12 window," "problems with the door brakes," "problems with the door locks," and "light 13 switch and sensor faults and front and rear sides" (see FAC ¶¶ 38-41). On the first three 14 such occasions, Key attributed the problems to Weatherford BMW's "recall" work (see 15 FAC ¶¶ 38-40) and, on the fourth such occasion, to either the recall work or repairs 16 performed on the third such occasion (see FAC ¶ 41). On the first, second, and fourth 17 such occasions, Weatherford BMW "extracted" data from Key's vehicle. (See FAC ¶¶ 38, 18 39, 41.) 19 Although Key "notified" Weatherford BMW that it had "damaged" her vehicle, 20 Weatherford BMW "denied having caused any damage" and "refused to pay for the 21 repairs." (See FAC ¶ 43.)2 Thereafter, in March 2019, Key, through counsel, contacted 22 23 2BMW has requested, and Key does not object, that the Court take judicial notice of "repair orders" prepared by Weatherford BMW on each of the four occasions 24 referenced above. (See Def.'s Req. for Judicial Notice Exs. A-E.) Said documents appear to indicate Weatherford BMW, with one exception, performed the repairs 25 requested by Key at no charge, the one exception being the fourth of the above- referenced occasions, when Weatherford BMW determined Key's "light module" should 26 be replaced, and the repair orders do not indicate such work was performed. (See id.) In light of such repair orders, as well as Key's allegation that Weatherford BMW and BMW 27 "initially did pay for some of the repair work" (see FAC ¶ 2), the Court understands Key to 1 BWM to request it provide her "the data that BMW [was] in possession of relating to 2 [Key's] vehicle," but BMW "refused, stating that 'a demand for production or a subpoena 3 for production may only be issued in connection with pending litigation.'" (See FAC ¶ 44.) 4 Key then took to the vehicle to an "independent repair facility," which was "unable 5 to diagnose or repair the vehicle" because BMW did not "allow" it to "access all of the 6 vehicle diagnostic data." (See FAC ¶ 45.) Key next took her vehicle to Concord BMW, 7 which "identified a variety of electrical and other problems" and "performed repairs" for 8 which it charged $1997.52, an amount Key paid. (See FAC ¶ 47.) 9 As of August 30, 2019, the date on which Key filed the FAC, her vehicle "continues 10 to experience problems that [she] attributes to the original recall repair." (See FAC ¶ 56.) 11 Based on the above allegations, Key asserts against BMW two claims for relief, 12 specifically, a claim under § 17200 of the California Business & Professions Code and a 13 common law conversion claim. Both claims are based on BMW's alleged refusal in 14 March 2019 to provide Key with the data Weatherford BMW had extracted from her 15 vehicle. According to Key, such data "can reveal when the fault codes relating to the 16 further damage were first detected," and that, "[i]f the fault codes were first detected while 17 the vehicle was being serviced by Weatherford BMW, [Key] would be able to prove that 18 Weatherford BMW caused the further damage while her BMW [v]ehicle was under 19 warranty and [she] would be able to compel Weatherford BMW, if necessary by legal 20 action, to pay for the expenses associated with repairing said further damage." (See 21 FAC ¶ 50.)3 22 LEGAL STANDARD 23 Dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure "can be 24 based on the lack of a cognizable legal theory or the absence of sufficient facts alleged 25 under a cognizable legal theory." See Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 26 699 (9th Cir. 1990). Rule 8(a)(2), however, "requires only 'a short and plain statement of 27 1 the claim showing that the pleader is entitled to relief.'" See Bell Atlantic Corp. v. 2 Twombly, 550 U.S. 544, 555 (2007) (quoting Fed. R. Civ. P. 8(a)(2)). Consequently, "a 3 complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual 4 allegations." See id. Nonetheless, "a plaintiff's obligation to provide the grounds of his 5 entitlement to relief requires more than labels and conclusions, and a formulaic recitation 6 of the elements of a cause of action will not do." See id. (internal quotation, citation, and 7 alteration omitted). 8 In analyzing a motion to dismiss, a district court must accept as true all material 9 allegations in the complaint and construe them in the light most favorable to the 10 nonmoving party. See NL Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986). "To 11 survive a motion to dismiss, a complaint must contain sufficient factual material, accepted 12 as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 13 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). "Factual allegations must be 14 enough to raise a right to relief above the speculative level[.]" Twombly, 550 U.S. at 555. 15 Courts "are not bound to accept as true a legal conclusion couched as a factual 16 allegation." See Iqbal, 556 U.S. at 678 (internal quotation and citation omitted). 17 DISCUSSION 18 In her first claim, which, as noted, asserts a violation of § 17200, Key alleges 19 BMW's failure to provide the data is "unfair" and "unlawful" (see FAC ¶¶ 75, 87) and that 20 she has "lost money or property" as a result, specifically, the $1997.52 she paid Concord 21 BMW for repairs (see FAC ¶ 54) and the data itself (see FAC ¶ 53). In her second claim, 22 which, as noted, asserts a claim of conversion, Key alleges she owns the "data collected 23 from [her vehicle]" (see FAC ¶ 105), which data BMW converted when it "refused to 24 return [it] upon [Key's] demand" (see FAC ¶ 106). 25 BMW argues Key has failed to allege facts to support a finding that, for purposes 26 of § 17200, she lost money or property as a result of BMW's failure to provide to her the 27 data extracted from her vehicle, see Cal. Bus. & Prof. Code § 17204 (limiting standing 1 competition") and that, for purposes of a conversion claim, she has failed to allege facts 2 to support a finding that she has a property right in the extracted data, see Silvaco Data 3 Systems v. Intel Corp., 184 Cal. App. 4th 210, 238 (2010) (holding "to state a claim for 4 conversion, the plaintiff must identify some property in which [s]he had property rights 5 with which the defendant could, and did, interfere"). 6 First, with regard to Key's payment to Concord BMW, BMW argues Key has failed 7 to allege facts to support a finding such loss of money was "caused by" BMW's failure to 8 provide the data. See Kwikset Corp. v. Superior Court, 51 Cal. 4th 310, 326 (2011) 9 (holding plaintiff asserting § 17200 claim must show loss was "caused by" conduct 10 plaintiff alleges to be in violation of § 17200). In the FAC, Key states she paid Concord 11 BMW to "fix the problems with her vehicle that she alleges were caused by Weatherford 12 BMW." (See FAC ¶ 54.) The FAC, however, includes no facts to support a finding that 13 BMW played any role in the allegedly faulty work performed by Weatherford BMW, i.e., 14 no facts to show BMW caused the problems Key paid Concord BMW to fix. To the extent 15 Key alleges a belief that the data will assist her in determining whether she has grounds 16 to seek legal recourse against Weatherford BMW, such belief is speculative, and, in any 17 event, even if the data could be used to support a claim against Weatherford BMW, Key 18 cites no authority suggesting BMW can be said to have caused the claimed economic 19 loss by reason of its having declined to assist Key in her efforts to determine if she has 20 grounds to seek relief from Weatherford BMW. Accordingly, Key has failed to show she 21 can base her § 17200 claim on her payment to Concord BMW. 22 Next, BMW argues the data extracted from Key's vehicle does not constitute 23 property in which she has an ownership interest. Under California law, "information is not 24 property unless some law makes it so." See Silvaco, 184 Cal. App. 4th at 239. In other 25 words, if "information" is not "made property by some provision of positive law, [it] 26 belongs to no one." See id. at 239 n.22. Consequently, it "cannot be converted or 27 stolen," see id., or, by logical extension, "lost" for purposes of § 17204. Here, Key cites 1 alone property of the vehicle owner, and, indeed, the only authority the Court has located 2 || would support a finding to the contrary. See, e.g., UCAR Technology (USA) Ine. v. Li, 3 || 2018 WL 2555429, at *7 (N.D. Cal. June 4, 2018) (dismissing § 17200 claim where 4 plaintiff alleged defendants had "erased" from plaintiff's computer "confidential and 5 proprietary information," as plaintiff failed to show such "information" was "made property 6 || by some provision of positive law").* Accordingly, Key has not shown she can base 7 || either her conversion claim or § 17200 claim on the asserted loss of such data. 8 CONCLUSION 9 For the reasons stated above, BMW's motion to dismiss is hereby GRANTED, and 10 || the First Amended Complaint is hereby DISMISSED. 11 If Key wishes to file a Second Amended Complaint in an effort to cure the 12 || deficiencies identified above, she shall file such pleading no later than January 31, 2020. £ 13 In light of the above, the Case Management Conference is hereby CONTINUED oO 14 || from January 24, 2020, to April 10, 2020, at 10:30 a.m. A Joint Case Management O 8 15 Statement shall be filed no later than April 3, 2020. Q 16 IT IS SO ORDERED. Cc 17 18 || Dated: January 13, 2020 . MAXINE M. CHESNEY 19 United States District Judge 20 21 22 23 “In her opposition, Key cites a California statute and regulation that require 24 || automobile repair dealers to provide to a customer an invoice containing specified information and to retain a copy of the invoice. See Cal. Bus. & Prof. Code § 9884.8 25 (providing invoice must, inter alia, "describe all service work done and parts supplied"); Cal. Code Regs. tit. 16, § CCR § 3356(c) (providing invoice must, inter alia, "describe .. . 26 [a]ll services and repairs, including any diagnostic or warranty repairs"); see also Cal. Bus. & Prof. Code § 9884.11 (providing dealers must retain invoices for three years, 27 || during which time specified government officials have right to inspect them). The cited statute and regulation, however, do not address who, if anyone, owns data extracted 28 from a vehicle.