1 FILED IN THE 2 EASTERU N. S D. I SD TI RS IT CR TI C OT F C WO AU SR HT I NGTON 3 Jun 10, 2021 4 SEAN F. MCAVOY, CLERK 5 6 UNITED STATES DISTRICT COURT 7 EASTERN DISTRICT OF WASHINGTON 8 9 LUCAS M. CHANEY, individually, and 10 as guardian ad litem for TC, a minor, and No. 2:19-CV-00272-SAB 11 KATHLEEN CHANEY, 12 Plaintiffs, ORDER RE: MOTIONS FOR 13 v. SUMMARY JUDGMENT 14 AUTO TRACKERS AND RECOVERY 15 NORTH, LLC, PATRICK K. WILLIS 16 COMPANY, INC. and SANTANDER 17 CONSUMER USA, INC., 18 Defendants. 19 20 Before the Court are Defendant Patrick K. Willis Co.’s Motion for Summary 21 Judgment, ECF No. 31 and Motion for Partial Summary Judgment Regarding 22 Cross-Claims Against Auto Trackers and Recover North LLC, ECF No. 35, as well 23 as its Motion to Strike Plaintiffs’ Opposition to Motion for Summary Judgment, 24 ECF No. 82. A videoconference hearing on the motions was held on May 27, 25 2021. Plaintiffs were represented by Alexander Trueblood and Michael Parker, 26 who appeared by telephone. Defendant Auto Trackers was represented by Sarah 27 Eversole, who appeared by video. Defendant Patrick K. Willis Co. was represented 28 by Marnie Silver and Charles Hausberg, who appeared by video. 1 Motion Standard 2 Summary judgment is appropriate “if the movant shows that there is no 3 genuine dispute as to any material fact and the movant is entitled to judgment as a 4 matter of law.” Fed. R. Civ. P. 56(a). There is no genuine issue for trial unless 5 there is sufficient evidence favoring the non-moving party for a jury to return a 6 verdict in that party’s favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 7 (1986). The moving party has the initial burden of showing the absence of a 8 genuine issue of fact for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). 9 If the moving party meets its initial burden, the non-moving party must go beyond 10 the pleadings and “set forth specific facts showing that there is a genuine issue for 11 trial.” Anderson, 477 U.S. at 248. 12 In addition to showing there are no questions of material fact, the moving 13 party must also show it is entitled to judgment as a matter of law. Smith v. Univ. of 14 Wash. Law Sch., 233 F.3d 1188, 1193 (9th Cir. 2000). The moving party is entitled 15 to judgment as a matter of law when the non-moving party fails to make a 16 sufficient showing on an essential element of a claim on which the non-moving 17 party has the burden of proof. Celotex, 477 U.S. at 323. The non-moving party 18 cannot rely on conclusory allegations alone to create an issue of material fact. 19 Hansen v. United States, 7 F.3d 137, 138 (9th Cir. 1993). 20 When considering a motion for summary judgment, a court may neither 21 weigh the evidence nor assess credibility; instead, “the evidence of the non-movant 22 is to be believed, and all justifiable inferences are to be drawn in his favor.” 23 Anderson, 477 U.S. at 255. 24 Background Facts 25 Plaintiffs brought this action after their car was repossessed. They allege the 26 repossession was a breach of the peace in violation of Wash. Rev. Code § 62A.9A- 27 609(b)(2), violated the Washington Consumer Protection Act, and violated the Fair 28 Debt Collections Practices Act. ECF No. 1. They also assert Defendants committed 1 assault and battery, and false imprisonment. Plaintiffs are suing the company that 2 held the purchase contract, Defendant Santander Consumer USA, Inc., the 3 company that was hired to repossess the car, Patrick K. Willis Co. (“PK Willis”) 4 and the company that Defendant PK Willis in turn hired to complete the 5 repossession and who actually repossessed the car, Defendant Auto Trackers and 6 Recovery North, LLC (“Auto Trackers”). 7 Defendant PK Willis filed a crossclaim against Defendant Auto Trackers for 8 breach of contract. It is also seeking a declaratory action that Defendant Auto 9 Trackers is required to defend, indemnify, and hold harmless Defendant PK Willis 10 and its client with respect to this lawsuit. 11 On or about August 29, 2018, Plaintiff Lucas Chaney purchased a used 12 vehicle from Autonation Chevrolet Spokane Valley, in Spokane, Washington, that 13 he intended to use primarily for personal, family, or household purposes. Plaintiff 14 and the dealership entered into a written agreement entitled “Retail Installment 15 Sale Contract Simple Finance Charge,” which granted the dealership a security 16 interest in the vehicle and provided for installment payments on the amount 17 financed. The dealership then assigned this contract, including the security interest, 18 to Defendant Santander. At some point, Defendant Santander concluded that 19 Plaintiffs defaulted on their payments and hired Defendant PK Willis to repossess 20 Plaintiffs’ vehicle. Defendant PK Willis then hired Defendant Auto Trackers to 21 repossess the vehicle. 22 On or about April 29, 2019, a tow truck driver employed by Defendant Auto 23 Trackers arrived unannounced at Plaintiffs’ home and, using his truck, blocked 24 them from leaving their driveway. Plaintiff Lucas Chaney immediately objected to 25 the repossession and told the tow truck driver to leave. The tow truck driver 26 refused and ordered Mr. Chaney to tell his wife to back up the vehicle onto his 27 towing apparatus. Mr. Chaney refused. 28 The tow truck driver then opened the back passenger door and tried to get to 1 nine-year old TC. When TC screamed, the repo man slammed the door on TC’s 2 leg. He then knocked Mr. Chaney to the ground, who was on crutches from a 3 recent hip surgery. Frightened by the violence, Plaintiffs stayed in their vehicle, 4 locked the doors, and called the police. Defendant Auto Trackers’ tow truck driver 5 remained outside the vehicle pounding on the windows, cursing and yelling that he 6 owned the vehicle, and calling Mr. Chaney a “deadbeat” and a “fucker.” He placed 7 various objects around the vehicle so Plaintiffs could not leave. 8 The police arrived at the scene, and the vehicle was eventually taken into 9 Defendant Auto Trackers’ possession. 10 1. Defendant PK Willis’ Motion for Partial Summary Judgment 11 Regarding Cross-Claims Against Auto Trackers and Recover North 12 LLC, ECF No. 31 13 In its cross-claims, Defendant PK Willis asserts that Defendant Auto 14 Trackers agreed in a written contract to defend and indemnify Defendant PK Willis 15 in this type of case. Defendant PK Willis asserts that it tendered defense of 16 Plaintiffs’ claims to Defendant Auto Trackers, but Defendant Auto Trackers 17 disavowed any obligation to defend. Defendant PK Willis is seeking summary 18 judgment on its declaratory judgment claim and on the liability aspect of the 19 breach of contract claim. Defendant Auto Trackers denies any responsibility to 20 defend or indemnify. 21 Background Facts 22 Defendant PK Willis provides nationwide asset recovery services to lenders 23 and contracts with different local companies to effectuate car repossessions. In 24 2014, Defendant PK Willis and Defendant Auto Trackers entered into a Master 25 Service Agreement.
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1 FILED IN THE 2 EASTERU N. S D. I SD TI RS IT CR TI C OT F C WO AU SR HT I NGTON 3 Jun 10, 2021 4 SEAN F. MCAVOY, CLERK 5 6 UNITED STATES DISTRICT COURT 7 EASTERN DISTRICT OF WASHINGTON 8 9 LUCAS M. CHANEY, individually, and 10 as guardian ad litem for TC, a minor, and No. 2:19-CV-00272-SAB 11 KATHLEEN CHANEY, 12 Plaintiffs, ORDER RE: MOTIONS FOR 13 v. SUMMARY JUDGMENT 14 AUTO TRACKERS AND RECOVERY 15 NORTH, LLC, PATRICK K. WILLIS 16 COMPANY, INC. and SANTANDER 17 CONSUMER USA, INC., 18 Defendants. 19 20 Before the Court are Defendant Patrick K. Willis Co.’s Motion for Summary 21 Judgment, ECF No. 31 and Motion for Partial Summary Judgment Regarding 22 Cross-Claims Against Auto Trackers and Recover North LLC, ECF No. 35, as well 23 as its Motion to Strike Plaintiffs’ Opposition to Motion for Summary Judgment, 24 ECF No. 82. A videoconference hearing on the motions was held on May 27, 25 2021. Plaintiffs were represented by Alexander Trueblood and Michael Parker, 26 who appeared by telephone. Defendant Auto Trackers was represented by Sarah 27 Eversole, who appeared by video. Defendant Patrick K. Willis Co. was represented 28 by Marnie Silver and Charles Hausberg, who appeared by video. 1 Motion Standard 2 Summary judgment is appropriate “if the movant shows that there is no 3 genuine dispute as to any material fact and the movant is entitled to judgment as a 4 matter of law.” Fed. R. Civ. P. 56(a). There is no genuine issue for trial unless 5 there is sufficient evidence favoring the non-moving party for a jury to return a 6 verdict in that party’s favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 7 (1986). The moving party has the initial burden of showing the absence of a 8 genuine issue of fact for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). 9 If the moving party meets its initial burden, the non-moving party must go beyond 10 the pleadings and “set forth specific facts showing that there is a genuine issue for 11 trial.” Anderson, 477 U.S. at 248. 12 In addition to showing there are no questions of material fact, the moving 13 party must also show it is entitled to judgment as a matter of law. Smith v. Univ. of 14 Wash. Law Sch., 233 F.3d 1188, 1193 (9th Cir. 2000). The moving party is entitled 15 to judgment as a matter of law when the non-moving party fails to make a 16 sufficient showing on an essential element of a claim on which the non-moving 17 party has the burden of proof. Celotex, 477 U.S. at 323. The non-moving party 18 cannot rely on conclusory allegations alone to create an issue of material fact. 19 Hansen v. United States, 7 F.3d 137, 138 (9th Cir. 1993). 20 When considering a motion for summary judgment, a court may neither 21 weigh the evidence nor assess credibility; instead, “the evidence of the non-movant 22 is to be believed, and all justifiable inferences are to be drawn in his favor.” 23 Anderson, 477 U.S. at 255. 24 Background Facts 25 Plaintiffs brought this action after their car was repossessed. They allege the 26 repossession was a breach of the peace in violation of Wash. Rev. Code § 62A.9A- 27 609(b)(2), violated the Washington Consumer Protection Act, and violated the Fair 28 Debt Collections Practices Act. ECF No. 1. They also assert Defendants committed 1 assault and battery, and false imprisonment. Plaintiffs are suing the company that 2 held the purchase contract, Defendant Santander Consumer USA, Inc., the 3 company that was hired to repossess the car, Patrick K. Willis Co. (“PK Willis”) 4 and the company that Defendant PK Willis in turn hired to complete the 5 repossession and who actually repossessed the car, Defendant Auto Trackers and 6 Recovery North, LLC (“Auto Trackers”). 7 Defendant PK Willis filed a crossclaim against Defendant Auto Trackers for 8 breach of contract. It is also seeking a declaratory action that Defendant Auto 9 Trackers is required to defend, indemnify, and hold harmless Defendant PK Willis 10 and its client with respect to this lawsuit. 11 On or about August 29, 2018, Plaintiff Lucas Chaney purchased a used 12 vehicle from Autonation Chevrolet Spokane Valley, in Spokane, Washington, that 13 he intended to use primarily for personal, family, or household purposes. Plaintiff 14 and the dealership entered into a written agreement entitled “Retail Installment 15 Sale Contract Simple Finance Charge,” which granted the dealership a security 16 interest in the vehicle and provided for installment payments on the amount 17 financed. The dealership then assigned this contract, including the security interest, 18 to Defendant Santander. At some point, Defendant Santander concluded that 19 Plaintiffs defaulted on their payments and hired Defendant PK Willis to repossess 20 Plaintiffs’ vehicle. Defendant PK Willis then hired Defendant Auto Trackers to 21 repossess the vehicle. 22 On or about April 29, 2019, a tow truck driver employed by Defendant Auto 23 Trackers arrived unannounced at Plaintiffs’ home and, using his truck, blocked 24 them from leaving their driveway. Plaintiff Lucas Chaney immediately objected to 25 the repossession and told the tow truck driver to leave. The tow truck driver 26 refused and ordered Mr. Chaney to tell his wife to back up the vehicle onto his 27 towing apparatus. Mr. Chaney refused. 28 The tow truck driver then opened the back passenger door and tried to get to 1 nine-year old TC. When TC screamed, the repo man slammed the door on TC’s 2 leg. He then knocked Mr. Chaney to the ground, who was on crutches from a 3 recent hip surgery. Frightened by the violence, Plaintiffs stayed in their vehicle, 4 locked the doors, and called the police. Defendant Auto Trackers’ tow truck driver 5 remained outside the vehicle pounding on the windows, cursing and yelling that he 6 owned the vehicle, and calling Mr. Chaney a “deadbeat” and a “fucker.” He placed 7 various objects around the vehicle so Plaintiffs could not leave. 8 The police arrived at the scene, and the vehicle was eventually taken into 9 Defendant Auto Trackers’ possession. 10 1. Defendant PK Willis’ Motion for Partial Summary Judgment 11 Regarding Cross-Claims Against Auto Trackers and Recover North 12 LLC, ECF No. 31 13 In its cross-claims, Defendant PK Willis asserts that Defendant Auto 14 Trackers agreed in a written contract to defend and indemnify Defendant PK Willis 15 in this type of case. Defendant PK Willis asserts that it tendered defense of 16 Plaintiffs’ claims to Defendant Auto Trackers, but Defendant Auto Trackers 17 disavowed any obligation to defend. Defendant PK Willis is seeking summary 18 judgment on its declaratory judgment claim and on the liability aspect of the 19 breach of contract claim. Defendant Auto Trackers denies any responsibility to 20 defend or indemnify. 21 Background Facts 22 Defendant PK Willis provides nationwide asset recovery services to lenders 23 and contracts with different local companies to effectuate car repossessions. In 24 2014, Defendant PK Willis and Defendant Auto Trackers entered into a Master 25 Service Agreement. Section 4 of the Master Service Agreement provides, as 26 follows: Service Provider hereby agrees to defend, indemnify and hold PKW 27 and each and every Client harmless from any and all claims, demands, 28 damages, liability, causes of action, actions, judgments, awards, fines, 1 penalties, costs, expenses of any kind and nature whatsoever, contingent and liquidated (including attorneys’ fees) arising from or 2 relating to Service Provider’s acts or omissions in connection with 3 attempting to repossess or recover, or the actual repossession or 4 recovery of collateral pursuant to any Assignments provided or referred to Service Provider by PKW, including but not limited to any 5 damage or claim for damage to the repossessed collateral while such 6 collateral is in the care, control or custody of Service Provider, excepting only such claims as are the result of the sole active 7 negligence or intentional misconduct of PKW or a Client. 8 ECF No. 76, Ex. A. Section 4 also provides that “Service Provider’s obligations under this 9 Agreement shall include the duty to defend and/or pay for the defense of PKW and 10 Clients in any action or other legal proceeding with legal counsel that is acceptable 11 to PKW in its sole and complete discretion.” Id. 12 According to Defendant, after it received notice of the lawsuit and before 13 tendering a defense to Defendant Auto Trackers, it agreed to defend and indemnify 14 Defendant Santander under a separate agreement between the two companies. 15 Defendant Auto Trackers’ insurance company, Prime Insurance Co., agreed to 16 defend PK Willis, but it has refused to defend Defendant Santander. 17 The Master Service Agreement provides that California law applies and 18 neither party appears to dispute this. 19 Applicable Law 20 California law recognizes that parties to a contract may define their duties to 21 one another in the event of a third-party claim against one or both arising out of 22 their relationship. Crawford v. Weather Shield Mfg., Inc., 44 Cal. 4th 541, 550 23 (2008). Generally, such indemnity agreements are construed under the same rules 24 that govern the interpretation of other contracts. Id. Effect is to be given to the 25 parties’ mutual intent as ascertained from the contract’s language if it is clear and 26 explicit. Id. Unless the parties have indicated a special meaning, the contract’s 27 words are to be understood in their ordinary and popular sense. Id. 28 1 // 2 “A contractual promise to ‘defend’ another against specified claims 3 connotes an obligation of active responsibility, from the outset, for the promisee’s 4 defense against such claims. The duty promised is to render, or fund, the service of 5 providing a defense on the promisee’s behalf—a duty that necessarily arises as 6 soon as such claims are made against the promisee, and may continue until they 7 have been resolved. This is the common understanding of the word ‘defend’ as it is 8 used in legal parlance is to “represent (someone) as an attorney.” Id. (quotations 9 omitted). 10 “[T]he elements of a cause of action for breach of contract are (1) the 11 existence of the contract, (2) plaintiff’s performance or excuse for 12 nonperformance, (3) defendant’s breach, and (4) the resulting damages to 13 plaintiff.” Oasis West Realty, LLC v. Goldman, 51 Cal. 4th 811, 821 (2011). 14 Analysis 15 The Master Service Agreement contains an exception to the indemnity 16 clause, namely “excepting only such claims as are the result of the sole active 17 negligence or intentional misconduct of PKW or a Client.” Defendant Auto 18 Trackers assert that Plaintiffs are bringing separate claims against Defendant 19 Santander for negligence and therefore it does not have a duty to defend. It 20 maintains that, at the minimum, questions of material fact exist regarding whether 21 this exception applies and whether it is required to indemnify Defendant 22 Santander. 23 Here, under the plain language of the contract, Defendant Auto Trackers has 24 a duty to defend Defendant PK Willis and its clients (Defendant Santander) against 25 any claims arising from or relating to Defendant Auto Trackers. In reviewing the 26 facts of the Complaint, it is clear that Plaintiffs’ claims arise from or relate to 27 Defendant Auto Trackers’ conduct and are not based on the “sole active negligence 28 or intentional misconduct” of Defendant Santander. As such, the contractual duty 1 to defend is triggered and Defendant Auto Trackers breached this duty by failing to 2 tender a defense for Defendant Santander. Consequently, summary judgment on 3 Defendant’s claims for declaratory judgment and breach of contract is appropriate. 4 2. Defendant PK Willis’ Motion for Summary Judgment, ECF No. 5 33 6 Defendant PK Willis asserts that summary judgment is appropriate because 7 Defendant Auto Trackers was an independent contractor and as such, it is not 8 vicariously liable for any alleged wrongdoing on the part of Defendant Auto 9 Trackers. Defendant PK Willis also argues that Plaintiffs cannot prove an essential 10 element of their Consumer Protection Act claim. 11 Plaintiffs assert Defendant PK Willis has a non-delegable duty to not breach 12 the peace during a repossession, citing to Washington law. As such, Defendant PK 13 Willis is liable for Defendant Auto Trackers’ conduct even if Auto Trackers acted 14 as an independent contractor. Plaintiffs also argue that regardless, PK Willis should 15 be held vicariously liable for Auto Trackers’ actions. 16 Applicable Law 17 In Washington, a repossession is lawful where there is a contractual right to 18 repossess, and it is accomplished without disturbing the peace. Jackson v. Peoples 19 Fed. Cred. Union, 25 Wash. App. 81, 88 (1979). “A breach of the peace is a public 20 offense done by violence, or one causing or likely to cause an immediate 21 disturbance of public order. Ragde v. Peoples Bank, 53 Wash. App. 173, 176 22 (1989). “To constitute a ‘breach of the peace’ it is not necessary that the peace be 23 actually broken, and if what is done is unjustifiable and unlawful, tending with 24 sufficient directness to break the peace, no more is required, nor is actual personal 25 violence an essential element of the offense.” Id. However, merely causing noise 26 while repossessing a vehicle is insufficient, as a matter of law, to demonstrate a 27 breach of the peace. Id. 28 // 1 A. Vicarious Liability 2 Under respondeat superior, an employer is vicariously liable to third parties 3 for torts committed by the servant within the scope of employment. Wilcox v. 4 Basehore, 187 Wash. 2d 772, 783 (2017) (citing to Restatement (Second) of 5 Agency § 219 (1958)). The Restatement defines a servant as a person employed to 6 perform services for another and who is subject to the other’s control while 7 performing those services. § 220(1). Generally, the terms “master-servant” are 8 considered synonymous with “employer-employee.” See id. § 220, comment g. 9 In order to hold an employer vicariously liable for the tortious acts of its 10 employees, it must be established that the employee was acting in furtherance of 11 the employer's business and that he or she was acting within the course and scope 12 of employment when the tortious act was committed. Thompson v. Everett Clinic, 13 71 Wash. App. 548, 551 (1993). 14 The Restatement provides a flexible ten-factor test to determine whether 15 there is sufficient control so that the person providing services is a servant: 16 (a) the extent of control which, by the agreement, the master may exercise 17 over the details of the work; 18 (b) whether or not the one employed is engaged in a distinct occupation or 19 business; 20 (c) the kind of occupation, with reference to whether, in the locality, the 21 work is usually done under the direction of the employer or by a specialist without 22 supervision; 23 (d) the skill required in the particular occupation; 24 (e) whether the employer or the workman supplies the instrumentalities, 25 tools, and the place of work for the person doing the work; 26 (f) the length of time for which the person is employed; 27 (g) the method of payment, whether by the time or by the job; 28 (h) whether or not the work is part of the regular business of the employer; 1 (i) whether or not the parties believe they are creating the relation of master 2 and servant; and 3 (j) whether the principal is or is not in business. 4 Chapman v. Black, 49 Wash. App. 94, 98-99 (1987). 5 The crucial factor is the right of control that must exist to prove agency. Id. 6 That said, the retention of the right to inspect and supervise and to ensure the 7 proper completion of the contract does not vitiate the independent contractor 8 relationship. Id. It is not necessary that all of the remaining factors be present 9 because no single one of them is conclusive and all relate, directly or indirectly, to 10 the crucial factor of control or right of control. Id. 11 If the evidence conflicts regarding the relationship between the parties at the 12 time of the injury or if the evidence is reasonably susceptible of more than one 13 inference, then the question is one of fact for the jury. Id. If the evidence is 14 undisputed, the question is one of law and left to the court for its determination. Id. 15 The general rule under Washington law is that a principal is not liable for 16 injuries caused by an independent contractor whose services are engaged by the 17 principal. Stout v. Warren, 176 Wash. 2d 263, 269 (2012). There are various 18 exceptions to this general rule. One exception is found in §§ 4161 and 4272 of the 19
20 1 Section 416 provides as follows:
21 One who employs an independent contractor to do work which the employer should recognize as likely to create during its progress a peculiar 22 risk of physical harm to others unless special precautions are taken, is 23 subject to liability for physical harm caused to them by the failure of the contractor to exercise reasonable care to take such precautions, even though 24 the employer has provided for such precautions in the contract or otherwise. 25 2 Section 427 provides as follows: 26 27 One who employs an independent contractor to do work involving a special danger to others which the employer knows or has reason to know 28 to be inherent in or normal to the work, or which he contemplates or has 1 Restatement (Second) of Torts, which permits vicarious liability for activities that 2 (a) involves a “special danger” that is “inherent in or normal to the work,” id. § 3 427, or (b) poses a “peculiar risk of physical harm,” id. § 416. Id. at 267. 4 Washington courts refer to this exception as “peculiar-risk vicarious liability.” Id. 5 A “peculiar risk of physical harm to others is one that arises out of the same 6 character of the work to be done and that is not a normal routine matter of 7 customary human activity.” Id. (quotation omitted). An activity posing a peculiar 8 risk does not create strict liability. Id. Notably, in Stout, the Washington Supreme 9 Court concluded that fugitive defendant apprehension is an activity that poses a 10 peculiar risk of harm and can result in a principal’s vicarious liability for the 11 negligence of an independent contractor.3 Id. at 270. 12 Under Washington law, then, in order for peculiar-risk vicarious liability to 13 apply “(1) the activity itself must pose a risk of physical harm absent special or 14 reasonable precautions (i.e. the risk must be inherent to the activity), (2) the risk 15 must ‘differ[] from the common risks to which persons in general are commonly 16 subjected,’ id. § 416 cmt. d, (i.e., the risk must be “peculiar” or “special”), (3) the 17 principal must know or have reason to know of the risk, and (4) the harm must 18 arise from the contractor’s negligence with respect to the risk that is inherent in the 19 activity, see id. § 426.” Id. at 274. Elements (1) and (2) are questions of law. Id. 20
21 reason to contemplate when making the contract, is subject to liability for physical harm caused to such others by the contractor's failure to take 22 reasonable precautions against such danger. 23 3 The Stout court also concluded that fugitive defendant apprehension is not an 24 abnormally dangerous activity because while the record indicated that there is 25 always a risk of some harm, it did not demonstrate the requisite “high degree of 26 risk” when reasonable care is exercised. Id. Additionally, there was no showing of 27 a likelihood that the harm would be great with reasonable precautions, rather it was 28 merely a possibility. Id. 1 Elements (3) and (4) are mixed questions of law and fact because they 2 involve circumstances that will vary from one case to the next, even given an 3 identical activity. Id. 4 Analysis 5 Here, summary judgment is not appropriate because genuine issues of 6 material fact exist regarding whether Defendant PK Willis should be held 7 vicariously liable for the actions of Defendant Auto Trackers.4 Specifically, there 8 are questions of material facts regarding the relationship between Defendant PK 9 Willis and Defendant Auto Trackers at the time of the injury. 10 Also, questions of fact remain regarding whether Defendant PK Willis 11 should be held liable based on peculiar-risk vicarious liability. Similar to fugitive 12 defendant apprehension, there is a peculiar risk of harm absent special precautions 13 with respect to repossession of vehicles. Similar to fugitive defendant 14 apprehension, with vehicle repossessions, there is a risk that the recovery agent’s 15 negligent actions will cause the vehicle owner to respond in a manner that causes 16 physical harm to others. The risks peculiar to and inherent in vehicle repossessions 17 differ from common risks to which members of the public are generally subjected. 18 If the recovery agent mistakenly takes the wrong vehicle and the owner resorts to 19 extreme measures to stop it, i.e. brandishing or using a weapon, members of the 20 public would be subject to the risk of being caught in the cross fire. See e.g. Stout, 21 178 Wash.2d at 274. As such, the Court finds, as a matter of law, that elements (1) 22 and (2) have been met. On the other hand, questions of fact remain regarding 23 whether elements (3) and (4) are met. 24 Thus, even if the jury decides that Defendant Auto Trackers is an 25
26 4 Whether Defendant PK Willis will be held vicariously liable is a question that 27 will need to be answer for all claims asserted by Plaintiff, including the tort-based 28 claims of assault, battery, and false imprisonment. 1 independent contractor, genuine issues of material fact exist regarding what 2 Defendant PK Willis knew about the risks and whether the harm arose from 3 Defendant Auto Trackers’ negligence with respect to the risk that is inherent in the 4 activity. 5 Finally, genuine issues of material fact exist whether PK Willis ratified 6 Defendant Auto Trackers’ conduct. 7 B. Washington Consumer Protection Act claim 8 Defendant PK Willis moves for summary judgment on Plaintiffs’ 9 Washington Consumer Protection Act claim arguing that Plaintiffs did not suffer 10 injury to his business or property as a result of the alleged CPA violation, and 11 Plaintiffs cannot prove the “unfair or deceptive act’ prong as against it. In its reply, 12 it argues that Plaintiffs’ CPA fails as a matter of law because there was no 13 independent act on the part of PK Willis and asserts that because PK Willis is not 14 vicariously liable for the acts of Defendant Auto Trackers, there can be no CPA 15 liability. 16 Applicable Law 17 To survive summary judgment on his Washington Consumer Protection Act 18 (“CPA”) claim, Plaintiffs must make a prima facie showing of five elements: (1) 19 an unfair or deceptive act or practice; (2) in trade or commerce; (3) that affects the 20 public interest; (4) an injury to plaintiff in his or her business or property; and (5) a 21 causal link between the unfair or deceptive act and the injury suffered. Hangman 22 Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105 Wash. 2d 778, 784–85 23 (1986). The CPA must be liberally construed to serve its purpose, which is “to 24 complement the body of federal law governing restraints of trade, unfair 25 competition and unfair, deceptive, and fraudulent acts or practices in order to 26 protect the public and foster fair and honest competition.” Id.; Wash. Rev Code 27 19.86.920. 28 Because the CPA does not define ‘unfair’ or ‘deceptive,’ Washington courts 1 have allowed the definitions to evolve through a “gradual process of judicial 2 inclusion and exclusion.” Klem v. Wash. Mut. Bank, 176 Wash. 2d 771, 786 (2013) 3 (citation omitted). In Klem, the Washington Supreme Court clarified that a claim 4 under the Washington CPA may be predicated upon a per se violation of statute5, 5 an act or practice that has the capacity to deceive substantial portions of the public, 6 or an unfair or deception act or practice not regulated by statute but in violation of 7 public interest. Id. The court noted that an act or practice can be unfair without 8 being deceptive. Id. 9 Washington courts have considered the following criteria in determining 10 whether a practice or act is “unfair:”
11 (1) whether the practice, without necessarily having been previously 12 considered unlawful, offends public policy as it has been established by statutes, the common law or otherwise—whether, in other words, it is within 13 at least the penumbra of some common-law, statutory, or other established 14 concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers (or 15 competitors or other businessmen).” 16 Rush v. Blackburn, 190 Wash. App. 945, 963 (2015) (citing Magney v. 17 Lincoln Mt. Sav. Bank, 34 Wash. App. 45, 57 (1983)). 18 Additionally, the courts have noted that current federal law suggests that a 19 “practice is unfair [if it] causes or is likely to cause substantial injury to consumers 20 which is not reasonably avoidable by consumers themselves and not outweigh by 21 countervailing benefits.” Id. (citing Klem, 176 Wash. 2d at 787). 22 Whether the public has an interest in any given action is to be determined by 23
24 5In Smart v. Emerald City Recovery, LLC, Judge Coughenour noted that because 25 Wash. Rev. Code 62A.9A-609 permitted non-judicial repossession of vehicles and 26 it did not specifically establish that a violation of the section constitutes an unfair 27 or deceptive act in trade or commerce, a violation of this statute was not a per se 28 violation of the CPA. 2018 WL 3569873 (W.D. Wash. July 25, 2018). 1 the trier of fact from several factors, depending upon the context in which the 2 alleged acts were committed: (1) Were the alleged acts committed in the course of 3 defendant’s business? (2) Are the acts part of a pattern or generalized course of 4 conduct? (3) Were repeated acts committed prior to the act involving plaintiff? (4) 5 Is there a real and substantial potential for repetition of defendant’s conduct after 6 the act involving plaintiff? (5) If the act complained of involved a single 7 transaction, were many consumers affected or likely to be affected by it? Id. The 8 likelihood that additional plaintiffs have been or will be injured in exactly the same 9 fashion can change a private dispute to one that affects the public interests. Id. 10 To show causation, “plaintiff must establish that, but for the defendant’s 11 unfair or deceptive practice, the plaintiff would not have suffered an injury.” 12 Indoor Billboard/Wash., Inc. v. Integra Telecom of Wash., Inc., 162 Wash. 2d 59, 13 84 (2007). The injury requirement is met upon proof that the plaintiff’s “property 14 interest or money is diminished because of the unlawful conduct even if the 15 expenses caused by the violation are minimal.” Panag v. Farmers Ins. Co. of 16 Wash., 166 Wash. 2d 27, 57 (2009). Pecuniary losses occasioned by inconvenience 17 may also be recoverable as actual damages. Id. Causation is generally a question 18 for the jury. Klem, 176 Wash. 2d at 795. 19 Analysis 20 Here, the Court finds that as a matter of law, breaching the peace while 21 repossessing a vehicle is an unfair practice that affects public interest. A reasonable 22 jury could find that by wrongfully repossessing the vehicle, Defendant Auto 23 Trackers caused Plaintiffs to suffered injuries. As such, summary judgment on the 24 Consumer Protection Act claim is not appropriate. 25 // 26 // 27 // 28 // 1 Accordingly, IT IS HEREBY ORDERED: 1. Defendant PK Willis’s Motion for Partial Summary Judgment Regarding 3 Cross-Claims Against Auto Trackers and Recovery North LLC, ECF No. 35, is GRANTED. 5 2. Defendant PK Willis’s Motion for Summary Judgment, ECF No. 31, is DENIED. 3. Defendant’s Motion to Strike, ECF No. 82, 1s DENIED. 8 IT IS SO ORDERED. The District Court Executive is hereby directed to file this Order and provide copies to counsel. 10 DATED this 10th day of June 2021. 11 12 13 14 byt Secta 16 Stanley A. Bastian 7 Chief United States District Judge 18 19 20 21 22 23 24 25 26 27 28 ORDER RE: MOTIONS FOR SUMMARY JUDGMENT ~ 15