Maxwell Glassburg v. Ford Motor Company
2:21-cv-01333
| C.D. Cal. | Nov 2, 2021Background
- Plaintiff Maxwell Glassburg bought a certified pre‑owned 2015 Ford Mustang in May 2018 from a non‑party Ford dealer and signed a Retail Installment Sales Contract containing an arbitration clause.
- Glassburg alleges a defective trunk‑lid wiring harness that impacts the backup camera, trunk functions, trunk light, and satellite radio, and asserts claims for: breach of express warranty, breach of implied warranty of merchantability, CLRA, UCL, and fraudulent omission.
- Ford moved to compel arbitration under the dealer contract and alternatively moved to dismiss the First Amended Complaint (FAC).
- The court concluded Ford is not a signatory to the dealer contract and rejected Ford’s nonsignatory theories (estoppel and agency), so it denied the motion to compel arbitration.
- On the motion to dismiss, the court allowed the express‑warranty claim and the CLRA/UCL claims to proceed, but dismissed the implied‑warranty and fraudulent‑omission claims without leave to amend.
- Court ordered Ford to answer within 21 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Motion to compel arbitration | Glassburg: Dealer contract does not bind Ford | Ford: Arbitration clause covers claims related to vehicle and third parties; Ford may enforce via nonsignatory theories | Denied — Ford not a signatory and nonsignatory theories fail under California law (court limits inquiry to state contract principles) |
| Estoppel (nonsignatory enforcement) | Glassburg: Claims arise independently of dealer contract | Ford: Manufacturer should be equitably estopped because claims relate to vehicle sale/condition | Denied — Kramer controls: manufacturer claims do not depend on the dealer purchase contract; Felisilda distinguished |
| Agency (nonsignatory enforcement) | Glassburg: Alleged agency does not make Ford bound by dealer contract | Ford: Dealer acted as Ford’s agent so arbitration should bind | Denied — no basis that Ford’s liability arose from acting as dealer’s agent or under the dealer contract |
| Express warranty (survival) | Glassburg: Ford Extended Service Plan covers wiring harness and servicer refused repair | Ford: Warranty limits/mileage/time and failure‑to‑plead specific breached term or adequate repair opportunity | Survives — FAC adequately alleges warranty terms and plausible excusal of further repair attempts; claim not dismissed |
| Implied warranty of merchantability | Glassburg: Third‑party beneficiary of dealer‑manufacturer agreement / privity exists | Ford: No privity; third‑party‑beneficiary exception inapplicable | Dismissed without leave to amend — privity lacking and court declines to extend third‑party‑beneficiary exception to this context |
| CLRA / UCL claims | Glassburg: Seeks injunctive relief (prospective repairs/replacement) so equitable relief appropriate | Ford: Sonner bars equitable claims absent inadequate legal remedy | Survives — injunctive relief pleaded; Sonner inapplicable here |
| Fraudulent omission | Glassburg: Ford concealed wiring harness defect and induced purchase | Ford: No duty to disclose; economic loss rule bars tort recovery | Dismissed without leave to amend — no duty to disclose for alleged intermittent backup‑camera malfunction; economic loss rule applies |
Key Cases Cited
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (federal policy favoring arbitration)
- Arthur Andersen LLP v. Carlisle, 556 U.S. 624 (state contract law governs nonsignatory enforcement of arbitration agreements)
- Kramer v. Toyota Motor Corp., 705 F.3d 1122 (manufacturer claims about vehicle condition arise independently of dealer purchase contract)
- Sonner v. Premier Nutrition Corp., 971 F.3d 834 (plaintiff seeking equitable relief must show inadequate remedy at law)
- Robinson Helicopter, Inc. v. Dana Corp., 34 Cal.4th 979 (economic loss rule bars tort recovery for purely economic losses)
- Engalla v. Permanente Med. Grp., Inc., 15 Cal.4th 951 (elements of fraud and deceit)
- LiMandri v. Judkins, 52 Cal. App.4th 326 (circumstances giving rise to a duty to disclose in omission‑based fraud claims)
- Clemens v. DaimlerChrysler Corp., 534 F.3d 1017 (privity requirement for implied warranty claims)