903 F. Supp. 2d 843
N.D. Cal.2012Background
- Plaintiff sues HP and Does 1–50 for six claims including CLRA, FAL, common law fraud, breach of express warranty, Song-Beverly, and UCL.
- Action concerns two HP desktop lines, Slimline (220-watt) and Pavilion (300-watt), with customizable components but non-customizable power supply.
- Plaintiff alleges HP failed to disclose that some configurations require more power than supplied, risking malfunction.
- Plaintiff purchased a Slimline with 220W supply (June 10, 2010); used with a 300W-recommended graphics card; malfunction occurred in November 2011 causing motherboard damage.
- HP moved to dismiss under Rule 12(b)(6) and 9(b); plaintiff opposed; the court granted dismissal without prejudice.
- Court relies on Rule 12(b)(6) plausibility standards, Rule 9(b) heightened pleading for fraud, and leave-to-amend standards.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Breach of express warranty viability | Elias argues latent defect present pre-warranty could breach | HP argues warranty excludes post-warranty malfunctions | Dismissed; can cure with facts, no ongoing breach shown |
| Song-Beverly implied warranty applicability | Mexia-like latent defect could breach within product life | One-year duration limits implied warranty; no latent defect shown within year | Dismissed without prejudice; latent defect not plausibly tied to merchantability |
| Fraud-based CLRA/FAL/UCL claims | Defendants misrepresented or omitted power-supply adequacy, deceiving consumers | Statements are puffery; omissions lack safety link and duty to disclose | Dismissed under Rule 9(b) without prejudice |
| Common law fraud claim | HP knowingly misled about power and adequacy | No specific false representations or justifiable reliance pled | Dismissed without prejudice |
| UCL treatment of unlawful/unfair prongs | HP violated public policy/unfair practices by underpowered products | No established public policy violation or unfair conduct proven | Unfair and unlawful prongs dismissed without prejudice; needs cure |
Key Cases Cited
- Daugherty v. American Honda Motor Co., 144 Cal.App.4th 824 (Cal. Ct. App. 2006) (express warranty coverage limited by warranty duration; latent defects within term party)
- Clemens v. DaimlerChrysler Corp., 534 F.3d 1017 (9th Cir. 2008) (latent defect not extending express warranty beyond term)
- Hicks v. Kaufman & Broad Home Corp., 89 Cal.App.4th 908 (Cal. Ct. App. 2001) (latent defect substantially certain to cause malfunction may support breach)
- Mexia v. Rinker Boat Co., 174 Cal.App.4th 1297 (Cal. Ct. App. 2009) (latent defect may breach implied warranty of merchantability within its duration)
- In re Sony Grand Wega KDF-E A10/A20 Series, 758 F.Supp.2d 1077 (S.D. Cal. 2010) (applies to consumer electronics; Hicks may not apply to all products)
- In re Toyota Motor Corp. Unintended Acceleration Mktg., Sales Practices, & Products Liab. Litig., 754 F.Supp.2d 1145 (C.D. Cal. 2010) (distinguishes product lifespan; warranty duration matters)
- Wilson v. Hewlett-Packard Co., 668 F.3d 1136 (9th Cir. 2012) (safety-link requirement for omissions in consumer warranty context)
- Colgan v. Leatherman Tool Group, Inc., 135 Cal.App.4th 663 (Cal. Ct. App. 2006) (reasonable consumer standard for CLRA/UCL/FAL)
- First Alliance Mortgage Co., 471 F.3d 977 (9th Cir. 2006) (UCL prong analysis; broad coverage)