James Bunn v. Navistar, Inc.

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 20a0005n.06
No. 19-5406
UNITED STATES COURT OF APPEALS FILED
FOR THE SIXTH CIRCUIT Jan 07, 2020
DEBORAH S. HUNT, Clerk
JAMES A. BUNN, dba Bunn Trucking, )
)
Plaintiff-Appellant, ) ON APPEAL FROM THE
) UNITED STATES DISTRICT
v. ) COURT FOR THE MIDDLE
) DISTRICT OF TENNESSEE
NAVISTAR, INC., dba International Used )
Truck Center, ) OPINION
)
Defendant-Appellee. )
)
Before: CLAY, STRANCH, and MURPHY, Circuit Judges.
CLAY, Circuit Judge. Plaintiff Bunn Trucking appeals the dismissal of his breach of
express warranty and breach of implied warranty of merchantability claims against Defendant
Navistar in this products-liability lawsuit. Plaintiff also appeals the denial of his Rule 59(e) motion
to alter or amend the district court’s judgment. For the reasons set forth below, we AFFIRM the
decisions of the district court.
I. BACKGROUND
A. Factual Background
Plaintiff is a sole proprietor doing business as Bunn Trucking. Defendant Navistar is a
manufacturer of heavy-duty trucks. On June 13, 2018, Plaintiff, represented by counsel, initiated
this products-liability action against Defendant in Tennessee state court, alleging the following
facts.
No. 19-5406, James Bunn v. Navistar, Inc.
On April 19, 2017, Plaintiff purchased two second-hand trucks from Defendant’s
dealership. One truck had 183,864 miles on it at the time of purchase (“Truck 1”), and the other
truck had 141,229 miles on it at the time of purchase (“Truck 2”). Plaintiff purchased a written
warranty for each truck, with each warranty covering the respective truck for 24 months or 200,000
miles. At the time of the purchase, Defendant’s agents warranted that the trucks were free from
defects and in perfect working order. Defendant assured Plaintiff that the trucks were suitable to
perform the duties for which they were manufactured. Upon purchasing the written warranty,
Defendant assured Plaintiff that Navistar technicians would be readily available to make any
necessary repairs. However, shortly after making the purchase, Plaintiff began to experience
numerous shortcomings with both trucks. For example, within three months of purchase, Truck 1
required a complete engine replacement and was out of service for two weeks. After the engine
was replaced, Truck 1 continued to have problems and, since the date of purchase, was out of
service for a total of nine months. Within four months of purchase, Truck 2 required a complete
engine replacement. After the engine was replaced, Truck 2 continued to have problems and, since
the date of purchase, was out of service for a total of eight months.
According to Plaintiff, the issues with the trucks included “(a) repeated instances of check
engine lights illuminating; (b) fuel pump failure; (c) sensor ‘shortage’ issues; (d) ‘knocking’ in the
engine requiring replacement; (e) excessive ‘smoke’ and hissing of the engine requiring
replacement; (f) gasket replacement; (g) clogged hoses; (h) A/C blower and compressor failure;
(i) complete engine failure; (j) other failures that prevented the Trucks from operating as
warranted.” R. 1-1, Pg. ID 9. Plaintiff alleged that he “repeatedly notified Defendant of the defects
related to the trucks, but Defendants [sic] failed to make repairs sufficient to correct the defects.”
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Id. at Pg. ID 10. Due to Defendant’s inability or unwillingness to obtain necessary parts, Plaintiff
experienced extensive delays for several months in getting the trucks repaired. Plaintiff lost a
“substantial amount of income” due to the trucks’ unreliability and the downtime required for
repairs. Id. at Pg. ID 9. Specifically, Plaintiff lost contracts with his client, Kochlogistics, worth
approximately $133,645.00 between April 22, 2017 and June 1, 2018. Plaintiff stated that “[u]pon
information and belief, Defendant became aware trucks sold to Plaintiff were inadequate for public
distribution.” Id. at Pg. ID 10.
B. Procedural History
In construing his own complaint in his favor, Plaintiff asserted the following causes of
action: (1) breach of express warranty; (2) breach of implied warranty of merchantability; (3)
breach of implied warranty of fitness for a particular purpose; (4) intentional misrepresentation
(fraud); and (5) two counts of violating the Tennessee Consumer Protection Act (“TCPA”), Tenn.
Code Ann. § 47-18-104(b)(7).
Defendant removed the action to federal court on the basis of diversity jurisdiction.
Defendant then moved to dismiss the action pursuant to Federal Rule of Civil Procedure 12(b)(6)
for failure to state a claim upon which relief may be granted. First, Defendant argued that
Plaintiff’s claims for breach of express and implied warranties should be dismissed because
Plaintiff failed to allege that the trucks were defective at the time they were delivered and for
failure to provide pre-suit notice of the breach, as required by Tennessee law. Next, Defendant
argued that Plaintiff’s fraud claim should be dismissed under the economic loss doctrine and
because Plaintiff failed to comply with the heightened pleading requirements of Rule 9(b).
Defendant then argued that Plaintiff’s first TCPA count should be dismissed because the TCPA
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provision that Defendant allegedly violated only applies to “goods” that are obtained for use by an
individual “primarily for personal, family, or household purposes,” a category which clearly did
not encompass the heavy-duty trucks used in Plaintiff’s business. R. 8, Pg. ID 47–48 (quoting
Tenn. Code. Ann. § 47-18-103(8)). Lastly, Defendant moved to dismiss Plaintiff’s second TCPA
count for failure to comply with the heightened pleading requirements of Rule 9(b).
In his response to Defendant’s motion to dismiss, Plaintiff conceded that the economic loss
doctrine barred his intentional misrepresentation claim and “aver[red] that Paragraph Nos. 38-43
of the Complaint should be stricken.” R. 12, Pg. ID 168. Plaintiff also conceded that his first
TCPA claim was inapplicable to the action and “aver[red] that Paragraph 45(a) of the Complaint
should be stricken.” Id. With regards to his second TCPA claim, Plaintiff stated that, “[a]s it
pertains to the Plaintiff’s allegations contained in Paragraph 45(b) of the Complaint, Plaintiff will
be filing a Motion to Amend pursuant to Federal Rule of Civil Procedure 15(a)(2) for the purpose
of pleading, with sufficient particularity, Defendant’s violation of the Tennessee Consumer
Protection Act as set forth in Paragraph 45(b) of the Complaint.” Id. at Pg. ID 169. In addition,
Plaintiff clarified that he was not suing on the basis of the written warranty that he had purchased
from Defendant, but rather on the basis of statements allegedly made by Defendant’s agents at the
time of purchase.
Plaintiff did not at any time amend his complaint as a matter of course under Federal Rule
of Civil Procedure 15(a)(1). See Fed. R. Civ. P. 15(a)(1). And, Plaintiff did not at any time obtain
Defendant’s written consent to amend his complaint or otherwise file a motion seeking leave of
the court to amend the complaint in order to bolster his second TCPA claim. See Fed. R. Civ. P.
15(a)(2).
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On January 25, 2019, the district court entered a judgment granting Defendant’s motion to
dismiss in its entirety. The district court reasoned that Plaintiff’s breach of express warranty and
breach of implied warranty of merchantability claims should be dismissed because Plaintiff failed
to plausibly allege that Defendant’s alleged warranties were false at the time they were made. The
district court dismissed Plaintiff’s implied warranty of fitness for a particular purpose claim,
finding that “Plaintiff’s stated ‘particular purpose’ is really an ordinary purpose—using heavy-
duty trucks for a commercial trucking business—and not a particular purpose capable of
supporting his claim.” R. 28, Pg. ID 234. Lastly, the court dismissed Plaintiff’s second TCPA
claim, finding that in the “approximately eight months after Plaintiff’s response was filed . . .
Plaintiff has not filed a motion to amend the TCPA claim,” and the claim, as pleaded in the original
complaint, did not plausibly allege any basis on which relief could be granted. Id. at Pg. ID 236.
Following the district court’s dismissal, Plaintiff filed a motion to alter or amend the
judgment pursuant to Federal Rule of Civil Procedure 59(e). Plaintiff’s ground for moving to
reopen the judgment was Plaintiff’s counsel’s mistaken impression that a complaint could not be
amended prior to the initial case management conference. After Defendant filed a response to
Plaintiff’s motion, the district court entered an order denying Plaintiff’s Rule 59(e) motion on
March 15, 2019. The district court found Plaintiff’s argument “nonsensical” because nothing in
either the Federal Rules or Local Rules impairs Plaintiff’s ability to amend his complaint as of
right or seek leave to do so prior to the initial case management conference. R. 35, Pg. ID 261–62.
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On April 9, 2019, Plaintiff filed a notice of appeal as to the district court’s order denying
his Rule 59(e) motion. On April 15, 2019, Plaintiff filed a timely Amended Notice of Appeal
clarifying that he appeals both the district court’s January 25, 2019 judgment dismissing the action,
and the district court’s March 15, 2019 order denying his Rule 59(e) motion.
II. STANDARD OF REVIEW
We review de novo a district court’s grant of a motion to dismiss. Majestic Bldg. Maint.,
Inc. v. Huntington Bancshares, Inc., 864 F.3d 455, 458 (6th Cir. 2017). In doing so, we may affirm
the district court’s decision on any ground that is supported by the record. La. Sch. Emps.’ Ret.
Sys. v. Ernst & Young, LLP, 622 F.3d 471, 477 (6th Cir. 2010). A motion to dismiss is properly
granted if the plaintiff has “fail[ed] to state a claim upon which relief can be granted.” Fed. R.
Civ. P. 12(b)(6). To survive a motion to dismiss, the plaintiff must allege facts that, if accepted as
true, are sufficient to state a claim to relief that is plausible on its face. Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555–57 (2007); see also Fed. R. Civ. P. 8(a)(2). “A claim has facial plausibility
when the plaintiff pleads factual content that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
“Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements,
do not suffice.” Id. To evaluate a complaint’s sufficiency, courts in this circuit follow three steps.
“First, the court must accept all of the plaintiff’s factual allegations as true. . . . Second, the court
must draw all reasonable inferences in the plaintiff’s favor. . . . And third, the court must take all
of those facts and inferences and determine whether they plausibly give rise to an entitlement to
relief.” Doe v. Baum, 903 F.3d 575, 581 (6th Cir. 2018) (citations omitted).
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III. ANALYSIS
A. Implied Warranty of Fitness for a Particular Purpose & Plaintiff’s First TCPA Claim
As a preliminary matter, Plaintiff does not challenge the district court’s dismissal of his
implied warranty of fitness for a particular purpose claim or the dismissal of his first TCPA claim
(i.e., that alleged in Paragraph 45(a) of the complaint) in his briefs before this Court. And,
Plaintiff’s counsel acknowledged at oral argument that Plaintiff is not appealing the dismissal of
his implied warranty of fitness for a particular purpose claim. Therefore, we consider those
arguments waived and affirm the district court’s dismissal of those claims. See, e.g., Radvansky v.
City of Olmsted Falls, 395 F.3d 291, 311 (6th Cir. 2005) (“[Plaintiff’s] failure to raise an argument
in his appellate brief constitutes a waiver of the argument on appeal.”).
B. Breach of Express Warranty & the Implied Warranty of Merchantability
Plaintiff contends that the district court erred by dismissing its breach of express warranty
and breach of implied warranty of merchantability claims under Rule 12(b)(6). The elements for
breach of express warranty in Tennessee are: “(1) the seller made an affirmation of fact intending
to induce the buyer to purchase the goods; (2) the buyer was, in fact, induced by the seller’s acts;
and (3) the affirmation of fact was false regardless of the seller’s knowledge of the falsity or
intention to create a warranty.” Jones v. WFM-Wo, Inc., 265 F. Supp. 3d 775, 781 (M.D. Tenn.
2017) (quoting Smith v. TimberPro Inc., No. W2016-00757-COA-R3-CV, 2017 WL 943317, at
*3 (Tenn. Ct. App. Mar. 9, 2017)); see also Tenn. Code Ann. § 47-2-313. To make out a claim for
breach of the implied warranty of merchantability, a plaintiff must show that the seller is a
merchant with respect to goods of that kind and that the goods were not fit for the ordinary purposes
for which such goods are used at the time they were delivered. Dan Stern Homes, Inc. v. Designer
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Floors & Homes, Inc., No. M2008–00065–COA–R3–CV, 2009 WL 1910955, at *4 (Tenn. Ct.
App. June 30, 2009) (citing Tenn. Code Ann. § 47-2-314). The implied warranty of
merchantability applies to second-hand goods. See Tenn. Code Ann. § 47-2-314, cmt. 3; see also
Patton v. McHone, 822 S.W.2d 608, 616 (Tenn. Ct. App. 1991). The district court dismissed both
of Plaintiff’s warranty claims, finding that Plaintiff failed to plausibly allege that the warranties
were false at the time they were made or that the trucks were not fit for ordinary use at the time
they were delivered. We now affirm the district court’s decision, although on different grounds.
See, e.g., La. Sch. Emps.’ Ret. Sys., 622 F.3d at 477.
In the court below, Defendant moved to dismiss, in part, on the ground that Plaintiff failed
to adequately plead notice as required by Tennessee Code Annotated § 47-2-607(3). Section 47-
2-607(3) of the Tennessee Code is Tennessee’s version of section 2-607(3) of the Uniform
Commercial Code. It provides in part that “[w]here a tender has been accepted . . . the buyer must
within a reasonable time after he discovers or should have discovered any breach notify the seller
of breach or be barred from any remedy.” Tenn. Code Ann. § 47-2-607(3). Similarly, the damages
provision for breach of warranty provides that “[w]here the buyer has accepted goods and given
notification (§ 47-2-607(3)) he may recover as damages for any nonconformity of tender the loss
resulting in the ordinary course of events from the seller’s breach as determined in any manner
which is reasonable.” Tenn. Code Ann. § 47-2-714 (emphasis added). According to Tennessee
courts, “[n]otification pursuant to Tenn. Code Ann. § 47-2-607 is an essential ingredient for an
action for damages.” Carmichael & Carmichael, Inc. v. Nicholstone Companies, Inc., No. 01-A-
01-9104-CV00148, 1992 WL 172404, at *6 (Tenn. Ct. App. July 24, 1992). “The purpose of
giving notice of breach is to allow the breaching party to cure the breach and thereby avoid the
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necessity of litigating the matter in court.” Alvarez v. Chevron Corp., 656 F.3d 925, 932 (9th Cir.
2011); see also Tenn. Code Ann. § 47-2-607(3), cmt. 4.
In determining whether Plaintiff’s claims should be dismissed for failure to comply with
§ 47-2-607(3), this Court must answer two questions. First, was Plaintiff required to plead notice
in his complaint (that is, was he required to plead facts that would plausibly satisfy § 47-2-607’s
notice requirement)? And, if so, what type of notice was required under the statute? Was it enough
for Plaintiff to allege that he notified Defendant of the various defects with the trucks, or was he
required to notify Defendant that those defects, in Plaintiff’s view, amounted to a breach of
warranty?
We answer the first question in the affirmative based solely on Plaintiff’s litigation
conduct. Plaintiff has never argued, either to this Court or to the district court, that his warranty
claims are not subject to the Tennessee notice statute. In fact, Plaintiff concedes in his briefs before
this Court that his claims are governed by § 47-2-607(3). And, Plaintiff conceded at oral argument
that his complaint was required to contain an adequate inference of notice pursuant to § 47-2-
607(3). In other words, Plaintiff has never argued that failure to satisfy § 47-2-607(3) should be
raised as an affirmative defense, and instead concedes that satisfaction of the statute is a condition
precedent to suit in Tennessee. Therefore, although some state courts have treated similar notice
requirements as affirmative defenses rather than elements of the claim that must be pled, compare,
e.g., Reid v. Eckerds Drugs, Inc., 253 S.E.2d 344, 347, 350 (N.C. App. 1979) (affirmative defense),
with, e.g., Stamper Black Hills Gold Jewelry, Inc. v. Souther, 414 N.W.2d 601, 604 (N.D. 1987)
(element), we find that Plaintiff has forfeited any such argument in this case.1 Thus, for purposes
1
While Tennessee courts have yet to resolve this question, other courts interpreting Tennessee law have
dismissed warranty claims for failure to adequately plead notice under Tenn. Code Ann. § 47-2-607(3). See, e.g.,
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of this appeal and in line with Plaintiff’s litigation conduct, we conclude that Plaintiff was required
to plead facts giving rise to a plausible inference of notice in compliance with § 47-2-607(3).
Next, we must determine whether Plaintiff’s allegations in his complaint satisfy that
requirement. For the reasons that follow, we find that they do not. Plaintiff argues that he
sufficiently pled notice, either because the complaint itself constituted sufficient notice according
to the Middle District of Tennessee’s holding in a personal-injury case, Smith v. Pfizer, 688 F.
Supp. 2d 735 (M.D. Tenn. 2010), or because his “allegations of major repairs . . . satisfy the
requirement under Tennessee law regarding notice.” Appellant Br. at 16. We find each of these
arguments unavailing.
In Smith v. Pfizer, the district court held that “a personal injury plaintiff can give notice by
filing suit” and, thus, does not have to allege any pre-suit notification of breach to satisfy § 47-2-
607(3). 688 F. Supp. 2d at 750. However, the court expressly distinguished commercial cases:
“As envisioned by Tenn. Code Ann. § 47-2-607(3)(a), a seller of goods with timely notice that
they are nonconforming may inspect the goods . . . and then cure the defects or preserve evidence
that no breach occurred.” Id. at 750–51 (quoting Duffy Tool & Stamping v. Bosch Auto. Motor
Sys. Corp., No. M1997-00144-COA-R3-CV, 2000 WL 122225, at *3 (Tenn. Ct. App. Feb. 1,
2000)). But, the court stated, “notice serves a different purpose in personal injury cases.” Id. at
751. Unlike in a commercial case, opportunity to cure in a personal injury case has no significance
“because the defect has already caused the harm and the seller can do nothing to remedy the
Siriano v. Goodman Mfg. Co., No. 2:14-cv-1131, 2015 WL 12748033, at *7–8 (S.D. Ohio Aug. 18, 2015); Rysewyk
v. Sears Holdings Corp., No. 15-cv-4519, 2015 WL 9259886, at *4 (N.D. Ill. Dec. 18, 2015); see also Alvarez v.
Chevron Corp., 656 F.3d 925, 931–32 (9th Cir. 2011) (“The district court properly dismissed these common law
claims because Plaintiffs failed to provide Defendants with reasonable notice.” (applying Cal. Com. Code
§ 2607(3)(A)). In any event, we do not decide in this case whether Tennessee courts would consider notice as a
condition precedent to suit because Plaintiff has forfeited any argument to the contrary.
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situation that has already occurred.” Id. (quoting Lary Lawrence, 6 Lawrence’s Anderson on the
Uniform Commercial Code § 2–607:7 (3d. ed. 2009)). This is a commercial case, and under
current Tennessee law, Pfizer is thus inapplicable.
Next, we must determine whether Plaintiff’s allegations that he notified Defendant of the
defects is sufficient to plausibly allege that he put Defendant on notice of an alleged breach under
§ 47-2-607(3). This is a more difficult question. Plaintiff argues that this Court should adopt a
relaxed view of how Tennessee courts would interpret § 47-2-607(3)’s notice requirement. In
Plaintiff’s view, his allegation that he told Defendant about certain defects with the trucks was
enough to adequately plead notice under § 47-2-607(3). In response, Defendant asks this Court to
find that Tennessee courts would adhere to the traditional, stricter reading of notice statutes such
as § 47-2-607(3) whereby it is not enough for a buyer to notify a seller simply of problems with a
good; instead, the buyer must notify the seller that, in the buyer’s view, the problems rise to the
level of a breach. Defendant points out this Court has historically adhered to the stricter view
when interpreting analogous notice statutes. For example, in a line of cases including Running
Springs Associates v. Masonite Corp., we analyzed Ohio’s identical notice statute. 680 F.2d 469
(6th Cir. 1982). In concluding that the statute requires notice that the problems with the goods rise
to the level of breach, rather than mere notice of the defect, this Court cited with approval the oft-
quoted language from Judge Learned Hand:
The plaintiff replies that the buyer is not required to give notice of what the seller
already knows, but this confuses two quite different things. The notice ‘of the
breach’ required is not of the facts, which the seller presumably knows quite as well
as, if not better than, the buyer, but of buyer’s claim that they constitute a breach.
The purpose of the notice is to advise the seller that he must meet a claim for
damages, as to which, rightly or wrongly, the law requires that he shall have early
warning.
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Id. at 469–70 (quoting Am. Mfg. Co. v. U.S. Shipping Board E. F. Corp., 7 F.2d 565, 566 (2d Cir.
1925)). Relying on this language, we held that Ohio’s identical notice statute requires a buyer to
put a seller on notice that “it was considered to be in breach” and not simply that the buyer “was
experiencing difficulties with the goods.” Id. at 470 (quoting K & M Joint Venture v. Smith Int’l,
Inc., 669 F.2d 1106, 1113 (6th Cir. 1982)); accord Standard Alliance Indus., Inc. v. Black Clawson
Co., 587 F.2d 813, 825 (6th Cir. 1978). But see Chemtrol Adhesives, Inc. v. American Mfrs. Mut.
Ins. Co., 537 N.E.2d 624, 638 (Ohio 1989) (rejecting the strict reading of the Ohio notice statute
in favor of the more relaxed view).
Tennessee courts have not recently spoken to this issue. And, although Tennessee may
eventually articulate a different interpretation of its notice statute, at this time, we think it
appropriate to assume that Tennessee courts would adhere to the traditional view that plaintiffs
must allege that they provided notice of a breach (i.e., that the defendant will be asked to meet a
claim for damages) in commercial cases such as this. That interpretation is supported by the plain
language of the statute. See Tenn. Code Ann. § 47-2-607(3) (“Where a tender has been accepted .
. . the buyer must within a reasonable time after he discovers or should have discovered any breach
notify the seller of breach or be barred from any remedy.” (emphasis added)). Our view is further
informed by early Tennessee case law.
In Wildman Manufacturing Co. v. Davenport Hosiery Mills, 249 S.W. 984 (Tenn. 1923),
the Supreme Court of Tennessee considered what type of notice was required under the notice
provision of the Uniform Sales Act of 1919 (the predecessor of UCC § 2-607).2 The defendant-
2
The relevant provision of the Uniform Sales Act required that “if, after acceptance of the goods, the buyer
fail[s] to give notice to the seller of the breach of any promise or warranty within a reasonable time after the buyer
knows or ought to know of such breach, the seller shall not be liable therefor.” Wildman, 249 S.W. at 986 (quoting
Uniform Sales Act, § 49 (1919).)
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seller in Wildman had consistently failed to deliver machines on time to the buyer. Id. at 987. The
buyer, in turn, repeatedly sent letters notifying the seller of the problems with the delivery delays,
but did not notify the seller of its intention to make a claim for damages. Id. at 988–91. After
reviewing several cases holding that the buyer is required to put the seller on notice of a breach
under the Uniform Sales Act (i.e., to put the seller on notice that the buyer intends to seek a claim
for damages), the Tennessee Supreme Court found that many of the buyer’s letters to the seller in
Wildman did not constitute sufficient notice under the Act. Id. at 993. For example, regarding the
buyer’s first letter to the seller, the court stated that “[w]hile this letter is full of complaints, and
refers to the broken promises of the [seller], we see nothing here indicating an intention to claim
damages for breach of contract.” Id. at 989. The court adopted the chancellor’s view that “a claim
for damages, and not merely a complaint or announcement of trouble, was necessary” under the
Act. Id. at 992. That is, the Tennessee Supreme Court held that it wasn’t until the buyer put the
seller on notice that it intended to make a claim for damages that the notice provision of the Act
was satisfied. Id. at 993.
Wildman’s holding aligns with our holding in Running Springs, and with the traditional
view and the plain language of the notice statutes. Moreover, this interpretation is especially
applicable in this case where Plaintiff purchased a written warranty, which evidenced the parties’
shared understanding that the second-hand trucks may need repairs at some point. Because
Plaintiff and Navistar mutually anticipated that the trucks may need repairs at some point, it seems
particularly unlikely that Plaintiff’s request for repairs would put Navistar on notice that the
transaction is claimed to involve a breach under § 47-2-607(3). Cf. Tenn. Code Ann. § 47-2-607,
cmt. 4 (“The notification which saves the buyer’s rights under this Article need only be such as
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informs the seller that the transaction is claimed to involve a breach, and thus opens the way for
normal settlement through negotiation.”).
For these reasons, we find that Plaintiff was required to plead that he put Navistar on notice
that the transaction was “claimed to involve a breach, and thus open[] the way for normal
settlement through negotiation” under current Tennessee law. Id. Because Plaintiff’s complaint
does not contain such allegations, the district court properly dismissed the breach of express
warranty and breach of implied warranty of merchantability claims for failure to state a claim
under Rule 12(b)(6). 3
C. Plaintiff’s Rule 59(e) Motion
“We generally review a denial of a motion to alter or amend the judgment under Rule 59(e)
for abuse of discretion.” Nat’l Ecological Found. v. Alexander, 496 F.3d 466, 476 (6th Cir. 2007)
(quoting Perez v. Aetna Life Ins. Co., 150 F.3d 550, 554 (6th Cir. 1998)). However, if the district
court’s denial of a Rule 59(e) motion is based on erroneous legal doctrine, then this Court employs
a de novo standard of review. Id. In the present case, the district court did not base its denial of
Plaintiff’s Rule 59(e) motion on an erroneous legal doctrine such that de novo review would apply,
and Plaintiff concedes on appeal that this Court should review the district court’s decision for
abuse of discretion.
“In this circuit, a district court may alter a judgment under Rule 59 based on (1) a clear
error of law; (2) newly discovered evidence; (3) an intervening change in controlling law; or (4) a
3
In the district court and on appeal, Defendant further argues that Plaintiff’s express warranty claim should
be dismissed because Plaintiff failed to plausibly allege that Defendant made any affirmations of fact beyond mere
puffery. Navistar also argues that Plaintiff failed to plausibly allege facts from which the district court could infer
causation and damages for each of his warranty claims. The district court declined to reach the merits of Defendant’s
causation and damages arguments because of other grounds for granting Navistar’s motion to dismiss. Because we
find that Plaintiff’s claims were insufficiently pled with regards to notice, we likewise do not address these issues.
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need to prevent manifest injustice.” Nolfi v. Ohio Kentucky Oil Corp., 675 F.3d 538, 551–52 (6th
Cir. 2012) (citing Leisure Caviar, LLC v. United States Fish & Wildlife Serv., 616 F.3d 612, 615
(6th Cir. 2010)). This standard vests “considerable discretion” in the district court. Leisure
Caviar, 616 F.3d at 615. When deciding whether to grant a Rule 59(e) motion, a district court
must consider the “interest of protecting the finality of judgments and the expeditious termination
of litigation.” Id. at 615–16 (quoting Morse v. McWhorter, 290 F.3d 795, 800 (6th Cir. 2002)).
Otherwise, “plaintiffs could use the court as a sounding board to discover holes in their arguments,
then ‘reopen the case by amending their complaint to take account of the court’s decision.’” Id. at
616 (quoting James v. Watt, 716 F.2d 71, 78 (1st Cir. 1983)). Therefore, unlike in the context of
Federal Rule of Civil Procedure 15(a), “[a] claimant who seeks to amend a complaint after losing
the case must provide a compelling explanation to the district court for granting the motion.” Id.
at 617. With this standard in mind, we find that the district court did not abuse its discretion by
denying Plaintiff’s Rule 59(e) motion to alter or amend the judgment. We address two preliminary
issues.
First, Plaintiff moved to alter the district court’s judgment only as to his second TCPA
claim, which was originally pleaded in Paragraph 45(b) of his complaint. Accordingly, the district
court limited its analysis to whether it should alter its dismissal of Plaintiff’s second TCPA claim
only. On appeal, Plaintiff does not challenge the district court’s interpretation of his Rule 59(e)
motion as applying only to his second TCPA claim. Therefore, we confine our review of Plaintiff’s
Rule 59(e) motion to his second TCPA claim as well.
Next, Plaintiff appears to argue that this Court should remand to the district court to provide
Plaintiff an opportunity to amend his TCPA claim pursuant to Federal Rule of Civil Procedure
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15(a)(2), regardless of this Court’s review of Plaintiff’s Rule 59(e) motion. This argument is
without merit. First, Plaintiff’s counsel acknowledges in his brief that “[i]t is undisputed that the
Plaintiff’s Complaint, as written, may not contain sufficient allegations to state a plausible claim
for relief as to the service-related cause of action presented in Paragraph 45(b). An amendment
would be required to survive the Defendant’s Motion to Dismiss as it relates to this cause of
action.” Br. for Appellant at 37. Plaintiff then proceeds to argue why such an amendment should
be allowed under Federal Rule of Civil Procedure 15(a)(2), arguing in particular that there would
be no undue delay or undue prejudice to Defendant.
Plaintiff’s argument misses the mark because Plaintiff never filed a motion to amend his
complaint either as of right or with leave of court in the district court. In his response in opposition
to Defendant’s motion to dismiss, Plaintiff stated “[a]s it pertains to the Plaintiff’s allegations
contained in Paragraph 45(b) of the Complaint, Plaintiff will be filing a Motion to Amend pursuant
to Federal Rule of Procedure 15(a)(2) for the purpose of pleading, with sufficient particularity,
Defendant’s violation of the Tennessee Consumer Protection Act as set forth in Paragraph 45(b)
of the Complaint.” R. 12, Pg. ID 169. In the same response, Plaintiff requested that “as it pertains
to the allegations set forth in Paragraph 45(b), Plaintiff be permitted to Amend the Complaint upon
proper motion pursuant to Federal Rule of Civil Procedure 15(a)(2).” Id. (emphasis added). But,
Plaintiff never filed a proper motion to amend his complaint, and this Court has repeatedly held
that “a bare request in an opposition to a motion to dismiss—without any indication of the
particular grounds on which amendment is sought . . . does not constitute a motion within the
contemplation of Rule 15(a).” La. Sch. Emps.’ Ret. Sys., 622 F.3d at 486 (quoting PR Diamonds,
Inc. v. Chandler, 364 F.3d 671, 699 (6th Cir. 2004), abrogated on other grounds, Frank v. Dana
16
No. 19-5406, James Bunn v. Navistar, Inc.
Corp., 646 F.3d 954, 961 (6th Cir. 2011)). For example, in Kuyat v. BioMimetic Therapeutics,
Inc., 747 F.3d 435, 444 (6th Cir. 2014), we found that “[b]oth because the plaintiffs did not present
an adequate motion and because they did not attach a copy of their amended complaint, the district
court did not abuse its discretion in refusing to allow the plaintiffs to amend their complaint based
on the final sentence of the plaintiffs’ memorandum in opposition.” Therefore, the district court
did not abuse its discretion in this case by failing to rule on a motion that was never before it. To
the extent that we consider remanding the case to provide Plaintiff with an opportunity to amend
his second TCPA claim, we do so by reviewing the district court’s denial of Plaintiff’s Rule 59(e)
motion only, rather than on any alleged failure of the district court to grant leave to amend under
Rule 15. For the reasons that follow, we find that the district court did not abuse its discretion by
denying Plaintiff’s Rule 59(e) motion.
In his Rule 59(e) motion, Plaintiff sought to reopen the district court’s judgment on his
TCPA claim because of Plaintiff’s counsel’s mistaken impression “that a case management
conference was required prior to filing his motion to amend.” R. 31, Pg. ID 242. Plaintiff argued
that Plaintiff’s counsel misunderstood when he was able to seek leave to amend the complaint
under the Local Rules and the Federal Rules of Civil Procedure. The district court correctly found
that Plaintiff’s counsel’s misunderstanding of the procedural rules did not satisfy any of the
requisite conditions for granting a Rule 59(e) motion. The court stated:
Plaintiff’s argument is nonsensical. The Federal Rules of Civil of Procedure do not
state that a party must wait to seek leave to amend a complaint until an initial case
management conference. In fact, they allow just the opposite. Under Rule
15(a)(1)(B), a party may amend its pleading “as a matter of course if the pleading
is one to which a responsive pleading is required, 21 days after service of a
responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or
(f), whichever is earlier.” Therefore, Plaintiff did not even need to seek leave but
instead could have directly responded to Defendant’s motion to dismiss with an
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No. 19-5406, James Bunn v. Navistar, Inc.
amended complaint. In addition, under Rule 15(a)(2), a party can amend its
pleading with the opposing party’s written consent or the court’s leave. Rule
15(a)(2) does not say that a party must wait until after an initial case management
conference to move for such relief. Nothing in the Local Rules impairs Plaintiff’s
right to amend his complaint or seek leave to do so before the initial case
management conference. Nor could it. “[L]ocal rules may not displace the Federal
Rules of Civil Procedure.” Wilson v. City of Zanesville, 954 F.2d 349, 352 (6th Cir.
1992).
R. 35, Pg. ID 261–62. The district court concluded that “[b]ecause Plaintiff—through a proper
understanding of the Federal Rules of Civil Procedure—could have easily avoided the outcome in
this case . . . a manifest injustice has not occurred.” Id. at Pg. ID 262.
We agree with the district court. Trial counsel’s misunderstanding of the Federal Rules is
not the type of “manifest injustice” at which Rule 59(e) is directed. This Court has repeatedly held
that trial counsel’s strategic mistakes do not justify reopening a judgment. See, e.g., Michigan
Flyer LLC v. Wayne Cty. Airport Auth., 860 F.3d 425, 431 (6th Cir. 2017); GenCorp, Inc. v. Am.
Int’l Underwriters, 178 F.3d 804, 834 (6th Cir. 1999); see also Leidos, Inc. v. Hellenic Republic,
881 F.3d 213, 217 (D.C. Cir. 2018) (“[M]anifest injustice ‘does not exist where . . . a party could
have easily avoided the outcome, but instead elected not to act until after a final order had been
entered.’”) (citation omitted). These holdings appropriately apply to counsel’s misunderstanding
of the Federal Rules where the language of the Rules was plain. See Fed. R. Civ. P. 15(a)(1) (“A
party may amend its pleading once as a matter of course within . . . 21 days after service of a
motion under Rule 12(b), (e), or (f) . . . .”). Therefore, we hold that the district court did not abuse
its discretion by denying Plaintiff’s Rule 59(e) motion to alter or amend the judgment on his TCPA
claim based on his trial counsel’s misunderstanding of the Federal Rules.
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No. 19-5406, James Bunn v. Navistar, Inc.
IV. CONCLUSION
For the reasons set forth above, we AFFIRM the district court’s judgment granting
Defendant’s motion to dismiss, and AFFIRM the district court’s order denying Plaintiff’s Rule
59(e) motion to alter or amend the judgment as to his TCPA claim.
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