Reniger v. Hyundai Motor America

122 F. Supp. 3d 888, 87 U.C.C. Rep. Serv. 2d (West) 476, 2015 U.S. Dist. LEXIS 109068, 2015 WL 4932565
CourtDistrict Court, N.D. California
DecidedAugust 18, 2015
DocketCase No. 14-3612 SC
StatusPublished
Cited by16 cases

This text of 122 F. Supp. 3d 888 (Reniger v. Hyundai Motor America) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reniger v. Hyundai Motor America, 122 F. Supp. 3d 888, 87 U.C.C. Rep. Serv. 2d (West) 476, 2015 U.S. Dist. LEXIS 109068, 2015 WL 4932565 (N.D. Cal. 2015).

Opinion

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTIONS TO DISMISS AND DENYING MOTION TO STRIKE ....

Samuel Conti, UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

Now before the Court are two motions in this putative class action alleging consumer protection, fraud, and warranty claims related to alleged low-speed stalling of Hyundai Santa Fe vehicles. See ECF No. 21 (“SAC”). First, Defendants Hyundai Motor America and Hyundai Motor Company (“HMC”) (collectively, “Hyundai”) hávé moved to strike Plaintiffs’ class action allegations and allegations relating to the Kia Motor Group on the grounds that these allegations are either contrary to California and Ninth Circuit law or otherwise redundant, impertinent, and immaterial under Federal Rule of Civil Procedure 12(f). ECF No. 31 (“Mot. to Strike”). Second, Defendants move to dismiss several of the named Plaintiffs for lack of standing and to dismiss the balance of Plaintiffs’ allegations for failure to state a claim. ECF No. 33 (“MTD”).

These motions are fully briefed,1 and appropriate for resolution without oral argument under Civil Local Rule 7-1 (b). For the reasons set forth below, the motion to dismiss is GRANTED IN PART and DENIED IN PART and the motion to strike is DENIED.

II. BACKGROUND

The Hyundai Santa Fe is a midsized sport utility vehicle manufactured by Hyundai since 2000. ' Plaintiffs allege that model year 2010-2012 Santa Fes have a [892]*892safety defect that causes the vehicle to totally lose power (or- “stall”). When an affected Santa Fe stalls, power - steering and brakes are lost as well, creating a potentially dangerous situation in which it is difficult to control the vehicle. Plaintiffs contend that Defendants had knowledge of this alleged defect through a variety of sources, including consumer complaints and similar problems experienced by Kia Motors, another automobile manufacturer, with its Kia Sorento, a midsized sport utility vehicle much like the Santa Fe.

Plaintiffs’ allegations, of knowledge and concealment of this alleged defect stem from a series of Technical Service Bulletins (“TSBs”) issued by Hyundai since 2010 “describing procedures that have been implemented by dealers to remedy the Stalling Defect without success.” SAC ¶¶ 7. These TSBs describe procedures for cleaning the “Electronic Throttle Control ... throttle body” to address idling, power, and throttle issues, and updates to the “Engine Control Module” to improve shifting at low throttle, coasting to a stop, and a “‘limp home’ condition caused by performance/power issues.” Id. at ¶¶8-10.

In 2014, Hyundai announced a “Voluntary Service Campaign,” which provides a free software update to address the risk that “during a specific set of operating conditions,” model year 20102012 vehicles can lose power or stall “when coming to a stop during braking at low speed....” Id. at ¶ 13. Hyundai notified regulators of the campaign, and states it sent a letter to all owners and lessees of Santa Fes in the affected model years notifying them of the issue and offering a free software update at dealerships to address the stalling problem. MTD at 3 (citing SAC Ex. H). However, Plaintiffs allege this is only the illusion of a fix and has, in certain cases, not been made available to the owners or lessees of all affected vehicles (including two of the named plaintiffs). See SAC: at ¶¶ 12-14,18.

The named - Plaintiffs in this putative class action are five current or former owners of new or used Santa Fes from model years 2010-2012. They seek to represent a nationwide class of owners and lessees of 2010-2012 Santa Fes and three subclasses made up of (1) New York owners and lessees, (2) California owners and lessees, and (3) California owners and' lessees who are “consumers” within the meaning of California Civil Code Section 1761(d). Plaintiffs allege nine causes of action, including violations of California and New York consumer, false advertising, and implied warranty laws; breach of the Magnuson-Moss Warranty Act (“Mag.Moss”)j 15 U.S.C. § 2301; and common law fraud. SAC ¶¶ 107-195.

While not all of the named plaintiffs allege out-of-pocket costs associated with the - stalling defect, all allege that they owned Santa Fes from model years 2010-2012 and experienced unforeseen and sometimes dangerous stalling. One, Reni-ger, sold her Santa Fe prior .to the service campaign after her vehicle stalled on several occasions and her Hyundai dealer was unable to remedy the stalling even after paying for service she understood would help with the stalling. Id. at ¶¶ 40-44. Two other named plaintiffs, Saitta and Mancuso, brought their vehicles in for Hyundai’s service campaign, but continued to experience stalling issues thereafter. Id. at ¶ 19. Three, Mancuso, Battaglia, and Jaffe, did not receive notice of the service campaign, and own Santa Fes that are listed as ineligible for the service campaign on Hyundai’s service campaign website, https://www.hyundaiusa.com/eampaign 929/. Id. at ¶¶ 51, 58. Of these, only Man-cuso brought her vehicle in for the service campaign, and Battaglia and Jaffe’s vehi[893]*893cles remain unfixed and are allegedly still afflicted. Id.

Now, arguing these allegations are insufficient to confer Article III standing or state a claim upon which relief can be granted, Hyundai moves to dismiss. Hyundai also seeks to strike -Plaintiffs’ class action allegations, arguing that these (and Plaintiffs’ allegations about the Kia Sorento and Hyundai’s relationship with Kia) are “an insufficient defense or redundant, immaterial,' impertinent, or scandalous matter” within the meaning of Federal Rule of Civil Procedure 12(f). Plaintiffs oppose.

The Court ordered supplemental briefing on both (1) whether standing of a single plaintiff satisfies the. minimum needs of Article III standing and (2) whether a transaction is required vice allegations of a safety concern. Order of the Court dated June 12; 2015, ECF No. 45 (“Supp. Briefing Order”). Parties have provided all responsive briefs. ECF Nos. 48 (“Supp.Mot.”), 49 (“Supp.Opp’n”), 50 (“Supp.Reply”).

III. LEGAL STANDARDS

A. Federal Rule of Civil Procedure 12(b)(1)

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) challenges the Court’s subject-matter jurisdiction. Chandler v. State Farm Mut. Auto. Ins. Co., 598 F.3d 1115, 1122 (9th Cir.2010). Because Article III standing relates to the Court’s subject-matter jurisdiction, it is properly raised on a Rule 12(b)(1) motion^ and the party asserting jurisdiction “bears the burden of proving its existence.” Id. at 1121-22.

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122 F. Supp. 3d 888, 87 U.C.C. Rep. Serv. 2d (West) 476, 2015 U.S. Dist. LEXIS 109068, 2015 WL 4932565, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reniger-v-hyundai-motor-america-cand-2015.