McNair v. McGrath Lexus-Colosimo, Ltd.

11 F. Supp. 2d 990, 1998 U.S. Dist. LEXIS 9080, 1998 WL 329712
CourtDistrict Court, N.D. Illinois
DecidedJune 11, 1998
Docket96 C 6964
StatusPublished
Cited by3 cases

This text of 11 F. Supp. 2d 990 (McNair v. McGrath Lexus-Colosimo, Ltd.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McNair v. McGrath Lexus-Colosimo, Ltd., 11 F. Supp. 2d 990, 1998 U.S. Dist. LEXIS 9080, 1998 WL 329712 (N.D. Ill. 1998).

Opinion

MEMORANDUM OPINION AND ORDER

BUCKLO, District Judge.

In their third amended complaint the plaintiffs, Mary McNair and Tiyi-Kitani McNair (“McNairs”), attempt to state claims under the Commerce Clause of the United States Constitution, the Illinois Consumer Fraud Act (“ICFA”), 815 ILCS 505/1 et seq., and the Magnuson-Moss Warranty Act (“Magnuson-Moss Act”), 15 U.S.C. § 2301 seq. 1 The defendant, McGrath Lexus-Co-losimo, Ltd. (“McGrath Lexus”), moves to dismiss the complaint. For the following reasons, the motion is granted in part and denied in part. 2

*992 Background

The McNairs allege they purchased a used Lexus from McGrath Lexus on two conditions: (1) four new tires were to be installed on the Lexus and (2) McGrath Lexus would provide a service agreement or warranty allowing the McNairs to obtain service from any Lexus dealer nationwide. (CompA 7). 3 On June 30, 1995, the McNairs tendered an unsigned check for $20,995.00 made payable to “Tiyi-Kitani McNair and Mary McNair and McGrath Lexus” to McGrath Lexus, took possession of the Lexus, and were told to call the dealership on July 3,1995, regarding the new tires. (Comp.M 6, 8). Upon calling McGrath Lexus, the McNairs allege they were told four new tires would not be provided. The McNairs asked that their money be returned. (CompA 10). According to the McNairs, McGrath Lexus equivocated regarding the return of the check. After two weeks of unreturned phone calls the McNairs contacted their bank and learned the check had been cashed bearing their purported signatures. (CompA 11). The McNairs claim the warranty they received restricts service to the McGrath Lexus dealership but that they have been barred from McGrath Lexus’ premises. (Comp.V 12).

ICFA

McGrath Lexus argues the McNairs may not maintain a claim under the ICFA because the McNairs’ complaint does not implicate consumer concerns and the McNairs did not meet the ICFA’s pre-filing notice requirements. On January 1, 1996, the ICFA was amended to require, when a plaintiff sues a ear dealer, “[p]roof of a public injury, a pattern, or an effect on consumers and the public interest generally....” 815 ILCS 505/10(a). The ICFA’s requirement is met if the plaintiff alleges the defendant acted in a manner that has the “[potential for repetition.” Id. Both the McNairs’ third and fourth amended complaints allege deceptive acts by McGrath Lexus that have the potential for repetition to other consumers. Accordingly, this requirement is met.

The newly amended ICFA also requires a plaintiff seeking relief against a car dealer to, at least thirty days prior to the filing of an action, “serve a written notice of the nature of the alleged violation and demand for relief upon the prospective party ... against whom such action will be commenced.” 815 ILCS 505/10a(h). The prospective party has thirty days to submit a written offer of settlement which, if rejected, may limit a prevailing plaintiffs ability to recover attorney’s fees. “The party who is seeking relief must certify in any cause of action that the notice and demand was served upon the named defendants and the substance of their response, if any.” Id. In neither the third amended complaint nor the fourth amended complaint do the McNairs certify a written notice demanding relief was served upon McGrath Lexus. Instead, the McNairs argue the legal purpose of the notice requirement was met by previous filed complaints in this action. Previously filed complaints do not meet the ICFA’s statutory notice requirement. Accordingly, until that requirement is met, the McNairs may not maintain a claim under the ICFA.

Magnuson-Moss Act

McGrath Lexus argues the McNairs’ Magnuson-Moss Act claim fails because the McNairs have not alleged a warranty violation and do not meet the amount in controversy requirement to sustain an action under the Magnuson-Moss Act. The McNairs allege they were barred from the McGrath Lexus dealership making it impossible to obtain service for their Lexus in violation of their warranty. (CompA 12). This is a sufficient allegation of breach of warranty. 4

Federal courts do not have jurisdiction over a Magnuson-Moss Act claim “if the amount in controversy is less than the sum or value of $50,000 (exclusive of interests [sic] and costs)_” 15 U.S.C. § 2310(d)(1)(B). The McNairs’ claim McGrath Lexus’ conduct entitles them to *993 $75,000 plus punitive damages and attorney’s fees. In their fourth amended complaint the McNairs allege they are also entitled to consequential damages and indicate they are specifically seeking $75,000 in punitive damages.

“Generally the amount in controversy claimed by a plaintiff in good faith will be determinative on the issue of jurisdictional amount, unless it appears to a legal certainty that the claim is for less than that required by the rule.” NLFC, Inc. v. Devcom Mid-America, Inc., 45 F.3d 231, 237 (7th Cir.1995). If a defendant challenges a plaintiffs ability to meet the jurisdictional amount, the plaintiff must present competent proof to a reasonable probability that jurisdiction exists. Id.

Although the McNairs request $75,000.00 in damages, the only sum specifically delineated is the price of the Lexus: $20,995.00. The Seventh Circuit recently indicated that since attorney’s fees do not exist at the time a case is filed, they should not be considered in determining the amount in controversy. Gardynski-Leschuck v. Ford Motor Co., 142 F.3d 955, 957-59 (7th Cir.1998). 5 Although the McNairs have added a claim for consequential damages in their fourth amended complaint, they have not presented any proof as to the extent of such damages. It is unlikely consequential damages in this case will be substantial.

The McNairs allege $75,000.00 in punitive damages in their fourth amended complaint. Congress was silent on the scope of damages under the Magnuson-Moss Act. The Seventh Circuit, in dicta, indicated punitive damages may be available under the Magnuson-Moss Act. In re General Motors Corp. Engine Interchange Litig., 594 F.2d 1106, 1132 n. 44 (7th Cir.1979).

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Bluebook (online)
11 F. Supp. 2d 990, 1998 U.S. Dist. LEXIS 9080, 1998 WL 329712, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mcnair-v-mcgrath-lexus-colosimo-ltd-ilnd-1998.