Case Name:   Bonino v. Ford Motor Company

Case No.:       1-13-CV-257374

This is an action for fraud based on representations made prior to plaintiff Russ Bonino’s (“Plaintiff”) purchase of a 2004 Ford Excursion (“subject vehicle” or “SUV”).

 

On December 23, 2003, Plaintiff purchased the subject vehicle from Bob Lynch Ford.  (See second amended complaint (“SAC”), ¶ 6, 9, 19.)  Before purchasing the subject vehicle, Plaintiff observed television advertisements for the 2004 Ford Excursion, describing it as best in class, reliable, having superior towing/hauling capacity and fuel mileage, and being built “Ford tough.”  (See SAC, ¶ 15.)  Plaintiff also read promotional materials that stated that: the 2004 Ford Excursion has the strength to handle the toughest assignments; the 6.0 liter diesel engine is build “Ford tough”; the 6.0 liter diesel engine is the “longest lasting diesel motor”; “altogether, the 6.0 L Power Strike is the longest lasting diesel in its class”; the 2004 Ford Excursion is “best in class” with “unsurpassed diesel horsepower and “the longest lasting diesel motor… [that] is the boldest, strongest, and most capable yet”; the 2004 Ford Excursion has “the best payload, best conventional towing, best braking performance, highest GVWR, unsurpassed GCWR… [and] best 5^th wheel towing”; the 2004 Ford Excursion is “best in class [for] horsepower, gas torque, unsurpassed diesel horsepower”; and, the Ford Super Duty powertrain “delivers the right power, right when you need it… [and] delivers the muscle to get the job done.”  (SAC, ¶ 14.)  Unfortunately for Plaintiff, the SUV was constantly in the shop and could not be relied upon because it repeatedly broke down.  (See SAC, ¶ 20.)  The dealership attempted to make repairs on the subject vehicle on at least five different occasions and failed to permanently remedy the SUV’s persistent problems.  (See SAC, ¶¶ 21-22.)  The express warranty for the subject vehicle expired on December 23, 2008 and Plaintiff contends it was on that date that he first discovered that the prior repairs failed to conform to the express warranty.  (See SAC, ¶¶ 24, 39.)

 

On April 30, 2013, Plaintiff contacted the Better Business Bureau (“BBB”) and asked for a repurchase or replacement of the vehicle under the Lemon Law; however, on August 21, 2013, the BBB denied Plaintiff’s request stating that the BBB lacked jurisdiction over the claim.  (See SAC, ¶ 26.)  Ford also denied Plaintiff’s request.  (See SAC, ¶ 26.)  On January 25, 2012, a class action was filed, Adams v. Ford Motor Company, Case No. 37-2012-00091290-CU-BC-CTL in the Superior Court of California, County of San Diego (“the Adams action”), of which Plaintiff was a putative class member.  (See SAC, ¶ 46.)  The Adams action was subsequently consolidated into pending multi district litigation/class action In re: Navistar 6.0 L Diesel Engine Products Liability Litigation; Custom Underground v. Ford Motor Company, United States District Court for the Northern District of Illinois, Eastern Division, Case No. 11 C 2496 (“the Navistar action”).  (See SAC, ¶ 50.)  Plaintiff was also a putative class member in a class action, Burns v. Navistar Inc., and Ford Motor Company, United States District Court for the Southern District of California, Case No. 10CV2295MAB BGS (“the Burns action”), which was filed on November 5, 2010.  (See SAC, ¶ 64.)  The Burns action was also consolidated into the Navistar action.  (See SAC, ¶ 70.)  Plaintiff was also a putative class member in a class action, Custom Underground, Inc. v. Ford Motor Company, United States District Court for the Northern District of Illinois Eastern Division, Case No. 1:10-CV-00127 (“the Custom Underground action”), which was filed on January 8, 2010.  (See SAC, ¶ 86.)  The Custom Underground action—in which the complaint alleged claims for negligence, breach of implied warranty of merchantability and breach of express warranty—was also consolidated into the Navistar action.  (See SAC, ¶ 91.)  On November 1, 2012, the parties stipulated to certification of the class.  On April 23, 2013, Plaintiff requested exclusion from the class action settlement in the Navistar action.  (See SAC, ¶¶ 52, 61, 72, 83, 94, 104.)  Plaintiff contends that the statute of limitations was tolled pursuant to American Pipe & Construction Co. v. Utah (1974) 414 U.S. 538 and by equitable tolling.  (See SAC, ¶¶ 46-113.)

 

On December 10, 2013, Plaintiff filed a complaint against defendant Ford Motor Company (“Defendant”), asserting the following causes of action:

 

1)     fraud in the inducement—intentional misrepresentation;

2)     fraud in the inducement—concealment;

3)     negligent misrepresentation;

4)     fraud in the performance of a contract—intentional misrepresentation;

5)     violation of the Consumer Legal Remedies Act; and,

6)     violation of the Song-Beverly Act.

 

On January 14, 2014, Plaintiff filed a FAC against Defendant, asserting identical causes of action.  Defendant demurred to the first through fifth causes of action, and the Court sustained the demurrer to each cause of action, stating:

 

Defendant demurs to the first through fourth causes of action on the ground that they are not pled with sufficient particularity.  Indeed, the claims do not allege when the misrepresentations were made.  (See Lazar v. Super. Ct. (Rykoff-Sexton, Inc.) (1996) 12 Cal. 4^th 631, 645 (stating that a fraud cause of action must “allege…when it was said or written”).)  Plaintiff apparently concedes the issue as he fails to address the issue in his opposition.  The demurrer to the first through fourth causes of action is SUSTAINED with 10 days leave to amend on this basis.

Defendant also demurs to the first through fourth causes of action on the ground that they are barred by the economic loss rule.  In opposition, Plaintiff cites to Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4^th 979.  In Robinson, the California Supreme Court indeed stated that the economic loss rule does not apply to a fraud or negligent misrepresentation claim where the damages are not dependent of the contract since “[n]o rational party would enter into a contract anticipating that they are or will be lied to.”  (Id. at pp. 991-993 (stating that “[w]e hold the economic loss rule does not bar Robinson’s fraud and intentional misrepresentation claims because they were independent of Dana’s breach of contract”).)  However, the problem with Plaintiff’s argument is that the alleged damages are dependent on the breach of warranty.  (See e.g., FAC, ¶¶ 163-164 (seeking rescission of the contract, restitution of payments, and damages for diminution in the value of the vehicle, and damages in the amount of the difference between the value of the vehicle equipped with the defective engine and the value of the vehicle if it had been equipped as warranted”), 211-212, 258-259.)  The Robinson court expressly stated that “the economic loss rule allows a plaintiff to recover in strict products liability in tort when a product defect causes damage to ‘other property,’ that is, property other than the product itself… [t]he law of contractual warranty governs damage to the product itself.”  (Id. at p.989.)  The demurrer to the first through fourth causes of action on this basis is also SUSTAINED with 10 days leave to amend.  (See Lazar v. Super. Ct. (Rykoff-Sexton, Inc.) (1996) 12 Cal. 4^th 631, 638 (stating that resulting damages is an element for a fraud claim); id. at p.645 (requiring a fraud claim to be pled with particularity); see also Cadlo v. Owens-Illinois, Inc. (2004) 125 Cal.App.4^th 513, 519 (also requiring resulting damages as an element for a fraud claim).)

 

Defendant also argues that the first through fourth causes of action are barred by the applicable three-year statute of limitations.  (See Code Civ. Proc. § 338, subd.(d).)  The FAC alleges that “[t]he vehicle was constantly in the shop and could not be relied on because it repeatedly broke down” and that “Plaintiff has attempted to have the engine issues fixed on many occasions… but the problems with the engine persisted” and “[o]n one occasion, the repair representatives advised Plaintiff that they had to clean soot or “coking” from the engine and its components.”  (FAC, ¶¶ 21-22.)  Despite those allegations, Plaintiff contends that he did not discover the alleged harm related to the engine of the subject vehicle because “[i]t was not until the express warranty for the engine in Plaintiff’s vehicle expired on December 23, 2008, that Plaintiff first discovered, or reasonably could have discovered, that Ford’s previous repairs to the engine during the express warranty period had failed to conform to Plaintiff’s vehicle to the express warranty.”  (FAC, ¶ 37.)

Here, there is a disconnect between the alleged misrepresentations made prior to the purchase of the vehicle and the basis for the delayed discovery.  Under the discovery rule, “the statute of limitations begins to run when the plaintiff suspects or should suspect that her injury was caused by wrongdoing, that someone has done something wrong to her.”  (Sahadi v. Scheaffer (2007) 155 Cal.App.4^th 704, 715 (Sixth District case), citing Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1110.)  “So long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her.”  (Id.)  “The discovery rule only delays accrual until the plaintiff has, or should have, inquiry notice of the cause of action.”  (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4^th 797, 807 (also stating that “[t]he discovery rule does not encourage dilatory tactics because plaintiffs are charged with presumptive knowledge of an injury”); see also Sahadi, supra, 155 Cal.App.4^th at p.715 (stating that “[s]o long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her”); see also Jolly, supra, 44 Cal.3d at p.1109 (stating that “[a] plaintiff is held to her actual knowledge as well as knowledge that could reasonably be discovered through investigation of sources open to her”).)  “In order to rely on the discovery rule for delayed accrual of a cause of action, a plaintiff whose complaint shows on its face that his claim would be barred without the benefit of the discovery rule must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence.”  (Fox, supra, 35 Cal.4^th at p.808.)  Although, as previously stated above, the FAC fails to allege exactly when the misrepresentations occurred, the FAC alleges that any such misrepresentations occurred prior to Plaintiff’s purchase of the subject vehicle on December 23, 2003 and thus the complaint shows on its face that the claims would be barred without the benefit of the discovery rule.  Since Plaintiff has failed to specifically plead facts to show the applicability of the discovery rule, the demurrer to the first through fourth causes of action is SUSTAINED with 10 days leave to amend.

In opposition to the demurrer to the first through fourth causes of action, Plaintiff makes a number of arguments regarding tolling based on the class action claims, but also concedes “that the statute of limitations on his claims ran from December 23, 2008 through January 8, 2010.”  Here, tolling would not save Plaintiff’s claims as alleged as there are no allegations in the FAC that suggest the applicability of the discovery rule in the first instance.

Defendant also demurs to the fifth cause of action for violation of the CLRA on the ground that it is barred by the statute of limitations.  In opposition, Plaintiff fails to address the argument, effectively conceding the issue.  Accordingly, the demurrer to the fifth cause of action is SUSTAINED with 10 days leave to amend.

The Court also agrees that the statements that form the basis of the CLRA claim, such as the subject vehicle was built “Ford tough” is the “best in class” or “best” or “boldest” or “strongest yet” is classic puffery.  (See Steen v. Southern California Supply Co. (1925) 74 Cal.App. 265, 266 (the statement that caramel coloring was “just as good or perhaps better than any” was “puffing talk”); see also W. J. Bush & Co. v. Van Camp Sea Food Co. (1921) 55 Cal.App. 672, 673 (the statement that the peach kernel oil “was equal to the ‘best grades of imported olive oil’… expressed a mere opinion”); see also Alexander v. Stone (1916) 29 Cal.App. 488, 490 (representation that “the goods were first class… amounts to no more than what is termed ‘puffing,’ or an expression of opinion or judgment”); see also Daugherty v. American Honda Motor Co., Inc. (2006) 144 Cal. App. 4th 824, 835; see also Klinker v. Alta Vista Health Care Ctr. (Dec. 9, 2005) 2005 Cal. App. Unpub. LEXIS 11392 *1, *30 (nonpub. opn., statements that patients would receive “best of care”, facility is “top notch”, care is “excellent,” and that the staff is “competent in every respect” are mere puffery).)  The demurrer to the fifth cause of action is SUSTAINED with 10 days leave to amend on this basis as well.

 

(March 21, 2014 order re: demurrer to the first amended complaint, pp.4:11-28, 5:1-28, 6:1-27, 7:1-16.)

 

The SAC’s new allegations primarily concern dates as to when Plaintiff brought his car in for repair (see SAC, ¶¶ 23, 39-40), and the belief that Plaintiff’s damages include “potential personal injuries… likely to be caused by the serious engine problems and defects… that Ford fraudulently failed to repair and eliminate during the warranty period.”  (SAC, ¶¶ 170, 196, 222, 270.)  Perhaps to re-emphasize, the SAC also re-alleges that the warranty expired on December 23, 2008, and that it was not until that date that Plaintiff discovered the falsity of Ford’s December 23, 2003 misrepresentations concerning the express warranty.  (SAC, ¶¶ 24, 39-40, 115, 116, 178, 179, 203, 204.)  The remaining amendment restates the alleged misrepresentations and nondisclosures.  (SAC, ¶ 285.)  The SAC asserts causes of action against Defendant for:

 

1)     fraud in the inducement—intentional misrepresentation;

2)     negligent misrepresentation;

3)     fraud in the inducement—concealment;

4)     fraud in the performance of a contract—intentional misrepresentation;

5)     violation of the Consumers Legal Remedies Act; and,

6)     violation of the Song-Beverly Consumer Warranty Act.

 

Defendant’s demurrer to the first through fifth causes of action

 

Defendant’s request for judicial notice of the complaint, the first amended complaint, the second amended complaint and the March 21, 2014 order regarding the demurrer to the FAC is GRANTED.  (Evid. Code § 452, subd. (d).)

 

Application of American Pipe tolling

 

In opposition to the demurrer, Plaintiff concedes “that the statute of limitations on his claims ran from December 23, 2008 through January 8, 2010 for 1 year and 16 days on the 4 year statute of limitations.”  Plaintiff asserts that the statute of limitations was tolled pursuant to American Pipe & Construction Co. v. Utah (1974) 414 U.S. 538 from January 8, 2010 until April 23, 2013—the date when Plaintiff opted out of the class action.  Plaintiff then filed his complaint on December 10, 2013, seven months and 17 days later after opting out.

 

Plaintiff relies upon San Francisco Unified School Dist. v. W.R. Grace & Co. (1995) 37 Cal.App.4^th 1318, in which the court stated that “a plaintiff who opts out of a federal class action is entitled to have the limitations period tolled during the time when it was a member of the class.”  (Id. at p. 1340.)

 

However, American Pipe tolling only applies to federal question claims, and not to Plaintiff’s state law claims of violation of the California Consumer Legal Remedies Act and violation of the Song-Beverly Consumer Warranty Act.  (See In re Ford Tailgate Litig. (N.D.Cal. 2014) 2014 U.S. Dist. LEXIS 32287 *1, *32 (stating “[t]he equitable tolling doctrine articulated in American Pipe, however, applies only to federal question claims and not to plaintiffs’ state law claim under the CLRA”).)  Moreover, as Defendant noted in its prior demurrer, California has not adopted cross-jurisdictional tolling and, to the extent that Plaintiffs rely on the Illinois federal actions, it does not appear that American Pipe tolling would apply.  (See Clemens v. DaimlerChrysler Corp. (9th Cir. Cal. 2008) 534 F.3d 1017, 1025 (Ninth Circuit concluding Civil Code fraud claim is time-barred, stating that plaintiffs may not rely on the filing of an Illinois nationwide class-action for purpose of American Pipe tolling because “the California Supreme Court has not adopted such cross-jurisdictional tolling… the weight of authority and California’s interest in managing its own judicial system counsel us not to import the doctrine of cross-jurisdictional tolling into California law… [t]he rule of American Pipe–which allows tolling within the federal court system in federal question class actions–does not mandate cross-jurisdictional tolling as a matter of state procedure.. [w]e therefore conclude that the filing of the Illinois action did not toll the statute”); see also Hendrix v. Novartis Pharm. Corp. (C.D. Cal. 2013) 975 F. Supp. 2d 1100, 1111 (stating that “Clemens bars the application of American Pipe tolling in this case… [where] Plaintiff here seeks to toll the statute of limitations based on the Tennessee Class Action”).)  Nevertheless, the SAC alleges that Plaintiff was a class member of the Burns class action—which was filed on November 5, 2010.  Therefore, American Pipe tolling applies to the SAC’s fraud claims from November 5, 2010 through April 23, 2013; however, it does not apply to the fifth and sixth causes of action.

 

Application of equitable tolling

 

Plaintiff alternately argues that equitable tolling should apply to toll his claims from the same time period through application of equitable tolling, citing Hatfield v. Halifax PLC (9th Cir. Cal. 2009) 564 F.3d 1177—a case which plainly noted that American Pipe tolling was unavailable to plaintiffs seeking cross-jurisdictional tolling.  (Id. at p.1187.)  The California Supreme Court stated that “ [e]quitable tolling… may suspend or extend the statute of limitations when a plaintiff has reasonably and in good faith chosen to pursue one among several remedies and the statute of limitations’ notice function has been served.”  (Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal.4^th 1185, 1192, citing McDonald v. Antelope Valley Community College Dist. (2008) 45 Cal.4^th 88, 99-100 (stating that “[b]roadly speaking, the doctrine applies ‘when an injured person has several legal remedies and, reasonably and in good faith, pursues one’”).)  As Plaintiff argues, the three factors that a court considers in the application of equitable tolling are: timely notice, and lack of prejudice, to the defendant, and reasonable and good faith conduct on the part of the plaintiff.  (See McDonald, supra, 45 Cal.4^th at p.102 (stating that “[c]oncerning our judicially created equitable tolling rule, we clarified that it required a showing of three elements: ‘timely notice, and lack of prejudice, to the defendant, and reasonable and good faith conduct on the part of the plaintiff’”).)

 

Here, equitable tolling would not apply to toll the claims based on the Custom Underground action.  As Defendant argued in its prior demurrer, the plaintiffs in the Custom Underground action alleged different claims, and thus, the Custom Underground action did not provide timely notice to Defendant regarding Plaintiff’s claims.  Further, there are no facts alleged that show that Plaintiff acted reasonably and in good faith with regards to his claims.  Here, class certification was stipulated to on November 1, 2012, Plaintiff opted out of the class on April 23, 2013, and despite believing that the statute of limitations starting running at the latest by December 23, 2008, he waited over seven months from the opt-out date to file the initial complaint in the instant action.  Plaintiff does not suggest reasons for the delay.  (See Goodman v. Kennedy (1976)18 Cal. 3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”), quoting Cooper v. Leslie Salt Co. (1969) 70 Cal. 2d 627, 636; see also Hendy v. Losse (1991) 54 Cal. 3d 723, 742 (stating that “the burden is on the plaintiff… to demonstrate the manner in which the complaint might be amended”).)  As the SAC fails to allege facts supporting the application of equitable tolling, and since the initial complaint was filed more than four years after Plaintiff’s admitted latest date of when the statute began to run— December 23, 2008—the claims are untimely and the demurrer to the first through fifth causes of action is SUSTAINED.

 

Equitable estoppel is also not applicable.

 

“In order to assert equitable estoppel, the following four elements must be present: (1) the party to be estopped must be apprised of the facts; (2) he must intend that his conduct be acted on, or must so act that the party asserting estoppel had a right to believe it was so intended; (3) the party asserting estoppel must be ignorant of the true state of facts; and (4) he must rely upon the conduct to his injury.”  (Sofranek v. County of Merced (2007) 146 Cal.App.4^th 1238, 1250.)  Again, Plaintiff concedes that the latest date of when the statute of limitations began to run was December 23, 2008.  There is no possibility that Plaintiff could have relied upon Defendant’s conduct to his injury since he filed his complaint more than four years after that date.  Accordingly, equitable estoppel is not applicable.

 

First, second and fifth causes of action

Nearly all of the alleged statements are classic puffery; the lone misrepresentation of fact is the promise that the product was free from inherent defects.

 

Puffery cannot be a basis for a fraud claim as such statements are held to be statements of opinion.  (See Hauter v. Zogarts (1975) 14 Cal.3d 104, 111-112 (stating that “[i]f defendants’ assertion of safety is merely a statement of opinion—mere ‘puffing’—they cannot be held liable for its falsity”; also stating that promises regarding the complete safety of a product are a representation of fact and not puffery).)  Here, the first, second and fifth causes of action alleges a litany of representations that are simply puffery.  (See SAC, ¶¶ 119 (“leader in its class”), 120 (“best in class”), 121 (“outpulls the competition” and is “more-capable”), 122 (“delivers the right power, right when you need it” and “delivers the muscle to get the job done”), 123 (“getting all the truck you need from the company that builds them best” and is “build Ford tough”), 124 (“longest-lasting diesel”), 125 (“best in class towing capacities” and can “tow what you want, where you want”), 126 (“ready to tow the heaviest loads with the greatest of ease”), 128 (“best sport-utility vehicle on the market” and “engine was reliable”), 142 (“great engine”), 285-287; see also Steen v. Southern California Supply Co. (1925) 74 Cal.App. 265, 266 (the statement that caramel coloring was “just as good or perhaps better than any” was “puffing talk”); see also W. J. Bush & Co. v. Van Camp Sea Food Co. (1921) 55 Cal.App. 672, 673 (the statement that the peach kernel oil “was equal to the ‘best grades of imported olive oil’… expressed a mere opinion”); see also Alexander v. Stone (1916) 29 Cal.App. 488, 490 (representation that “the goods were first class… amounts to no more than what is termed ‘puffing,’ or an expression of opinion or judgment”); see also Daugherty v. American Honda Motor Co., Inc. (2006) 144 Cal. App. 4th 824, 835; see also Klinker v. Alta Vista Health Care Ctr. (Dec. 9, 2005) 2005 Cal. App. Unpub. LEXIS 11392 *1, *30 (nonpub. opn., statements that patients would receive “best of care”, facility is “top notch”, care is “excellent,” and that the staff is “competent in every respect” are mere puffery).)  The sole representation that could be construed as a representation of fact and not puffery is the alleged representation that Defendant promised that the product was “free from inherent defects.”  (See SAC, ¶¶ 127, 179, 181, 285.)  This promise, taken literally, would be a warranty of the product’s condition, and thus, if taken literally, is a representation of fact.  Accordingly, the Court will only address this promise for the first, second and fifth causes of action.

 

The discovery rule does not save Plaintiff’s first, second and fifth causes of action.

 

As stated in the Court’s prior order, there is a disconnect between the alleged misrepresentation made prior to the purchase of the vehicle and the basis for the delayed discovery.  Under the discovery rule, “the statute of limitations begins to run when the plaintiff suspects or should suspect that her injury was caused by wrongdoing, that someone has done something wrong to her.”  (Sahadi v. Scheaffer (2007) 155 Cal.App.4^th 704, 715 (Sixth District case), citing Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1110.)  “So long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her.”  (Id.)  “The discovery rule only delays accrual until the plaintiff has, or should have, inquiry notice of the cause of action.”  (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4^th 797, 807 (also stating that “[t]he discovery rule does not encourage dilatory tactics because plaintiffs are charged with presumptive knowledge of an injury”); see also Sahadi, supra, 155 Cal.App.4^th at p.715 (stating that “[s]o long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her”); see also Jolly, supra, 44 Cal.3d at p.1109 (stating that “[a] plaintiff is held to her actual knowledge as well as knowledge that could reasonably be discovered through investigation of sources open to her”).)  “In order to rely on the discovery rule for delayed accrual of a cause of action, a plaintiff whose complaint shows on its face that his claim would be barred without the benefit of the discovery rule must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence.”  (Fox, supra, 35 Cal.4^th at p.808.)

 

Here, as a matter of law, Plaintiff was on inquiry notice that the representation that the product was free of defects was false by at least September 10, 2007—the date of the fifth repair.[1]  Plaintiff did not file his complaint within three years of this date, and was not a member of the Adams action or the Burns action, and thus Plaintiff is not entitled to equitable tolling for these claims based on those actions either.  (See McDonald, supra, 45 Cal.4^th at p.102 (requiring timely notice to the defendant for equitable tolling to apply); see also Code Civ. Proc. § 338, subd. (d) (statute of limitations for fraud cause of action is three years); see also Civ. Code § 1783 (statute of limitations for CLRA claim is three years).)  The demurrer to the first, second and fifth causes of action is SUSTAINED without leave to amend.

 

The third cause of action for fraud in the inducement and concealment

 

The third cause of action alleges that Defendant induced Plaintiff into entering into a purchase contract for the subject vehicle, intentionally concealing the fact that the subject vehicle was equipped with a defective Navistar engine which Ford could not repair under its express warranty.  (See SAC, ¶ 205.)  The third cause of action seeks rescission of the contract, restitution of payments, and damages for diminution in the value of the vehicle, and “damages in the amount of the difference between the value of the vehicle equipped with the defective engine and the value of the vehicle if it had been equipped as warranted” as well as new alleged damages for “potential personal injuries to Plaintiffs likely to be caused by the serious engine problems and defects with the subject 2004 Excursion resulting in accidents while driving the truck, and potential future lawsuits for personal injuries and property damage from third parties involved in accidents with Plaintiff likely to be caused by the serious engine problems and defects with the subject Excursion that Ford failed to repair and eliminate during the warranty period.”  (SAC, ¶¶ 221-222.)

 

Defendant again demurs to the cause of action on the ground that it is barred by the economic loss rule, asserting that the new allegations in paragraph 222 are too speculative.  The Court agrees.  (See Food Safety Net Services v. Eco Safe Systems USA, Inc. (2012) 209 Cal.App.4^th 1118, 1132 (concluding fraud claims barred by economic loss rule and stating that “damages which are speculative, remote, imaginary, contingent, or merely possible cannot serve as a legal basis for recovery”), quoting Frustuck v. City of Fairfax (1963) 212 Cal.App.2d 345, 367-368; see also Toscano v. Greene Music (2004) 124 Cal.App.4^th 685, 694 (stating that “the court’s damage award in these circumstances must not be speculative, remote, contingent or merely possible”); see also Piscitelli v. Friedenberg (2001) 87 Cal.App.4^th 953, 989, quoting Frustruck, supra, 212 Cal.App.2d at pp.367-368; see also Goehring v. Chapman University (2004) 121 Cal.App.4^th 353, 367 (same).)  For reasons already articulated, and as Plaintiff has failed to demonstrate the viability of the claim through amendment, the third cause of action is barred by the economic loss rule.  (See Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4^th 979, 989 (stating that “the economic loss rule allows a plaintiff to recover in strict products liability in tort when a product defect causes damage to ‘other property,’ that is, property other than the product itself… [t]he law of contractual warranty governs damage to the product itself”); see also Lazar v. Super. Ct. (Rykoff-Sexton, Inc.) (1996) 12 Cal. 4^th 631, 638 (stating that resulting damages is an element for a fraud claim); id. at p.645 (requiring a fraud claim to be pled with particularity); see also Goodman v. Kennedy (1976)18 Cal. 3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”), quoting Cooper v. Leslie Salt Co. (1969) 70 Cal. 2d 627, 636; see also Hendy v. Losse (1991) 54 Cal. 3d 723, 742 (stating that “the burden is on the plaintiff… to demonstrate the manner in which the complaint might be amended”).)  Additionally, the multiple alleged facts demonstrating knowledge of Defendant’s inability to repair the known defects under its warranty (see SAC, ¶¶ 146-158) occur after the parties entered into the alleged December 23, 2003 purchase contract.  (See Food Safety Services, supra, 209 Cal.App.4^th at p.1131 (stating that “[t]o establish a claim of fraudulent inducement, one must show that the defendant did not intend to honor its contractual promises when they were made”).)  Accordingly, the demurrer to the third cause of action is SUSTAINED without leave to amend.

 

The fourth cause of action for fraud in the performance of contract—intentional misrepresentation

 

The fourth cause of action alleges that the warranty misrepresented that Defendant’s dealers would repair or otherwise eliminate all defects in the engine that occurred during the warranty period.  The claim alleges the same damages as the third cause of action (see SAC, ¶¶ 268-270), accordingly, for reasons already articulated in the Court’s prior order and above, and as Plaintiff has failed to demonstrate the viability of the claim through amendment, the fourth cause of action is barred by the economic loss rule.  (See Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4^th 979, 989 (stating that “the economic loss rule allows a plaintiff to recover in strict products liability in tort when a product defect causes damage to ‘other property,’ that is, property other than the product itself… [t]he law of contractual warranty governs damage to the product itself”); see also Lazar v. Super. Ct. (Rykoff-Sexton, Inc.) (1996) 12 Cal. 4^th 631, 638 (stating that resulting damages is an element for a fraud claim); id. at p.645 (requiring a fraud claim to be pled with particularity); see also Goodman v. Kennedy (1976)18 Cal. 3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”), quoting Cooper v. Leslie Salt Co. (1969) 70 Cal. 2d 627, 636; see also Hendy v. Losse (1991) 54 Cal. 3d 723, 742 (stating that “the burden is on the plaintiff… to demonstrate the manner in which the complaint might be amended”).)  Further, to the extent that the claim is one for promise without intent to perform, the SAC fails to allege facts demonstrating Defendant’s lack of intent to perform since the allegations show that Defendant only became aware of its inability to rectify the defects under the warranty period after the parties entered into the alleged December 23, 2003 purchase contract.  (See SAC, ¶¶  242-254.)  Accordingly, the demurrer to the fourth cause of action is SUSTAINED without leave to amend.

 

Defendant’s motion to strike portions of the SAC

 

Defendant moves to strike the words “and implied” from paragraph 305 of the SAC, and paragraphs 310 and 311 of the SAC in their entirety.

Here, it is clear that there is a four-year statute of limitations for the Song-Beverly Act claim.  (See Mexia v. Rinker Boat Co., Inc. (2009) 174 Cal.App.4^th 1297, 1306 (stating that “the statute of limitations for an action for breach of warranty under the Song-Beverly Act is four years pursuant to section 2725 of the California Uniform Commercial Code”).)  It is also clear that Plaintiff may allege facts supporting a basis for his delayed discovery.  Plaintiff concedes that the statute of limitations on his claim began to run on December 23, 2008.  (See Pl.’s opposition to motion to strike the SAC, p.6:11-15.)  However, Plaintiff’s initial complaint was filed more than four years prior to the filing of his complaint; thus, the Court must address Plaintiff’s tolling arguments which were identical to the tolling arguments made in opposition to the demurrer.

 

As previously stated, American Pipe tolling does not apply to the sixth cause of action since American Pipe tolling only applies to federal question claims, and not to Plaintiff’s state law claim for violation of the Song-Beverly Consumer Warranty Act.  (See In re Ford Tailgate Litig. (N.D.Cal. 2014) 2014 U.S. Dist. LEXIS 32287 *1, *32 (stating “[t]he equitable tolling doctrine articulated in American Pipe, however, applies only to federal question claims and not to plaintiffs’ state law claim under the CLRA”).)  Plaintiff’s equitable tolling argument relies on the Custom Underground action; however, as previously stated, the plaintiffs in the Custom Underground action alleged different claims, and thus, the Custom Underground action did not provide timely notice to Defendant regarding Plaintiff’s claims.  Further, there are no facts alleged that show that Plaintiff acted reasonably and in good faith with regards to his claims.  As previously stated, class certification was stipulated to on November 1, 2012, Plaintiff opted out of the class on April 23, 2013, and despite believing that the statute of limitations starting running at the latest by December 23, 2008, he waited over seven months from the opt-out date to file the initial complaint in the instant action.  Plaintiff does not suggest reasons for the delay.  (See Goodman v. Kennedy (1976)18 Cal. 3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”), quoting Cooper v. Leslie Salt Co. (1969) 70 Cal. 2d 627, 636; see also Hendy v. Losse (1991) 54 Cal. 3d 723, 742 (stating that “the burden is on the plaintiff… to demonstrate the manner in which the complaint might be amended”).)  Likewise, equitable estoppel is not available because there is no possibility that Plaintiff could have relied upon Defendant’s conduct to his injury since he filed his complaint more than four years after the date of discovery.  Plaintiff has not alleged or asserted in opposition that Defendant made repair efforts beyond the warranty period or made representations post-warranty period and has instead conceded that the statute of limitations started to run on December 23, 2008.  (See Goodman v. Kennedy (1976)18 Cal. 3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”), quoting Cooper v. Leslie Salt Co. (1969) 70 Cal. 2d 627, 636; see also Hendy v. Losse (1991) 54 Cal. 3d 723, 742 (stating that “the burden is on the plaintiff… to demonstrate the manner in which the complaint might be amended”).)  Defendant’s motion to strike is GRANTED without leave to amend.

 

Accordingly, the words “and implied” from paragraph 305 of the SAC, and paragraphs 310 and 311 of the SAC in their entirety are hereby stricken.

 

The Court will prepare the order.   After Defendant has served notice of entry of the order sustaining demurrer, Defendant shall submit a proposed judgment consistent with this order.