Fresno Motors, LLC v. Mercedes-Benz USA, LLC
2014 U.S. App. LEXIS 21127
| 9th Cir. | 2014Background
- MB exercised ROFR on Fresno Motors APA after Fresno formed to purchase the Fresno dealership.
- MB received required information (including Floor Plan Financing commitment) and had 60 days to decide; timing centered on June 15, 2009.
- AA (Acknowledgment Agreement) on June 19, 2009 stated MB would be primarily responsible and not release MB’s obligations via assignment.
- Asbury terminated the Fresno APA; Fresno sought to challenge MB’s ROFR as untimely/unlawful.
- District court granted MB summary judgment on all claims; Fresno appealed.
- Issues on appeal include tortious interference, fraudulent concealment, and a private remedy under Vehicle Code § 11713.3(t)(6).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness and propriety of ROFR exercise | Fresno contends MB exercised untimely/unlawful ROFR. | MB timely, properly exercised ROFR under the Dealer Agreement and statute. | MB timely and properly exercised ROFR; summary judgment on interference claims affirmed. |
| Tortious interference with contract | MB's ROFR interference disrupted Fresno-Asbury contract. | MB was not a stranger with direct interest; proper exercise cannot support interference claim. | No liability for interference; MB's lawful ROFR defeats contract interference claim. |
| Tortious interference with prospective economic advantage | MB's actions interfered with Fresno's prospective deal. | As a party with a direct interest, MB could not be liable for interference. | No liability; MB's conduct not wrongful and ROFR proper. |
| Fraudulent concealment (Acknowledgment Agreement) | MB concealed that it would be primarily responsible for sublease performance. | Acknowledgment Agreement does not guarantee landlord sublease; disclosure was sufficient. | No material concealment; summary judgment affirmed. |
| Private right of action under Cal. Veh. Code § 11713.3(t)(6) | Proposed transferee has standing to recover expenses from ROFR usurpation. | Vehicle Code § 11713.3(t)(6) does not create such private action for transferees. | Court reverses on this count; implied private right of action exists for transferees; remand for proceedings consistent. |
| Unfair Competition Law (UCL) claim viability | UCL claim based on tort claims and notices under § 11713.3(t)(2) and concealment. | If underlying claims fail, UCL claim should fail as well. | Affirmed; MB entitled to summary judgment on UCL claims. |
Key Cases Cited
- Pac. Gas & Elec. Co. v. Bear Stearns & Co., 50 Cal.3d 1118 (Cal. 1990) (elements for intentional interference)
- Marin Tug & Barge, Inc. v. Westport Petroleum, Inc., 271 F.3d 825 (9th Cir. 2001) (core doctrine: third-party must interfere in economic relation)
- Applied Equipment Corp. v. Litton Saudi Arabia Ltd., 7 Cal.4th 503 (Cal. 1994) (strict reading of 'strangers' in interference doctrine)
- Menke v. DaimlerChrysler Motors Co., 171 Cal.App.4th 1088 (Cal. App. 2009) (private action under vehicle code subsection (t)(6))
- Jones v. ConocoPhillips, 198 Cal.App.4th 1187 (Cal. App. 2011) (fraudulent concealment considerations)
- Woods v. Fox Broad. Sub., Inc., 129 Cal.App.4th 344 (Cal. App. 2005) (limits of 'not a stranger' concept in interference torts)