370 F. Supp. 3d 772
E.D. Mich.2019Background
- Twenty-three plaintiffs sued GM over 2015–2017 Chevrolet Corvette Z06 vehicles, alleging a design defect in the cooling/powertrain system that causes overheating, loss of power and occasional "Limp Mode," especially during track use.
- Plaintiffs contend GM marketed the Z06 as "track-proven," tested it extensively, knew about thermal limitations (including a 2015 statement by Corvette chief engineer Tadge Juechter), and concealed the defect while continuing track-focused marketing.
- Plaintiffs seek to represent a nationwide class (MMWA) and 18 state subclasses asserting state consumer-protection, fraudulent concealment, implied-warranty, and unjust-enrichment claims.
- GM moved to dismiss under Rules 12(b)(6) and 9(b) and to strike class allegations; the court resolved numerous state-law issues, privity arguments, and pleading deficiencies.
- The court dismissed the nationwide MMWA claim and struck nationwide class allegations, dismissed certain state claims (including New York and Ohio class claims), denied dismissal of many state consumer-protection and fraud claims, and dismissed all unjust-enrichment claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to represent New York class | Lawrence can represent NY class or class definition could be modified to cover those deceived in NY | Lawrence did not purchase/lease in NY and thus lacks standing | NY class allegations struck; Lawrence and Counts 46–50 dismissed |
| Nationwide MMWA claim | MMWA claim alleges breach of written warranties based on defect; leave to amend to invoke implied warranty | MMWA depends on breach of warranty cognizable under state law and express warranties cover materials/workmanship not design defects | MMWA claim (Count 1) dismissed; nationwide class allegations stricken |
| Implied warranty (merchantability) and privity | Z06 unfit for ordinary purposes (track and road); manufacturers' marketing expands ordinary purpose; various privity exceptions apply | Some states require vertical privity; GM argues lack of privity bars claims in several states | Implied-warranty claims survive generally on pleading fitness; dismissed for Connecticut, Ohio, Illinois (lack of privity); survive for California (3rd-party beneficiary), Nevada (no privity requirement); GA and KS privity arguments abandoned by GM |
| Fraudulent concealment: reliance and knowledge | Plaintiffs identified GM marketing materials they saw and relied on; GM tested cars and Juechter statement shows knowledge; online complaints noticed by GM | Reliance not pled with particularity; GM lacked knowledge at time of some purchases; 2017 model differs so prior complaints irrelevant | Fraud claims satisfy Rule 9(b) for most plaintiffs; plaintiffs plausibly allege GM knew of defect for 2015–2016 models; 2017-based claims (e.g., Herold) dismissed where no pre-purchase facts showing GM knowledge; several state-specific duty-to-disclose dismissals (Ohio, Michigan, Pennsylvania) |
| State consumer-protection and class/relief limits | Statutory claims proceed; class treatment appropriate | State statutes or precedent bar class relief or limit remedies (e.g., Colorado, Georgia, Tennessee, Michigan exemptions) | Many state statutory claims survived Rule 9(b); class claims dismissed where state law bars class actions or monetary class relief (GFBPA, TCPA, Colorado CCPA monetary class remedy barred); Michigan MCPA claim dismissed due to regulatory exemption; some state statutory claims dismissed on other state-law grounds |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (plausibility standard for Rule 12(b)(6))
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (pleading must state a plausible claim)
- In re MyFord Touch Consumer Litig., 291 F. Supp. 3d 936 (vehicle defect may render car unmerchantable for ordinary purposes beyond mere transportation)
- FCA US LLC Monostable Electrical Gearshift Litigation, 280 F. Supp. 3d 975 (Rule 9(b) and pleading fraudulent omissions in vehicle-defect context)
- Vacation Village, Inc. v. Hitachi Am., Ltd., 874 P.2d 744 (Nev. 1994) (Nevada does not require vertical privity for implied-warranty claims)