Michelson v. Volkswagen Aktiengesellschaft
2018 Ohio 1303
| Oh. Ct. App. 8th Dist. Cuyahog... | 2018Background
- Michelson bought a 2009 Volkswagen CC used in 2014; about two years later (90,000 miles) the timing chain failed and required an engine replacement costing >$7,000.
- She sued Volkswagen alleging: (1) unfair/deceptive acts under Ohio Consumer Sales Practices Act (CSPA); (2) deceptive trade practices under Ohio Deceptive Trade Practices Act (ODTPA); and (3) design/manufacturing defects (variously pleaded as product liability, implied warranty, or negligent design).
- Volkswagen moved to dismiss under Civ.R. 12(B)(6); the trial court granted the motion and dismissed all counts.
- On appeal the court reviewed dismissal de novo, accepting factual allegations but not legal conclusions.
- The appellate court affirmed dismissal: CSPA claim failed because Volkswagen (a manufacturer of a used vehicle sold by an unnamed seller, no warranty alleged) lacked the requisite connection as a supplier in the pleaded transaction; ODTPA claim failed because consumers lack standing under precedent; product-liability/defect theories failed because only economic damage to the product was alleged and common-law negligent-design claims have been abrogated by R.C. 2307.71(B).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of CSPA (1345.02) | Michelson: Volkswagen marketed/distributed the vehicle to her and thus is a "supplier" in a consumer transaction | Volkswagen: As a manufacturer of a used car with no warranty and no direct connection to the sale to Michelson, it is not a supplier in the transaction | Dismissed — plaintiff failed to plead a CSPA claim; facts do not show Volkswagen engaged in the consumer transaction pleaded |
| Applicability of ODTPA (R.C. ch.4165) | Michelson: ODTPA covers deceptive trade practices by Volkswagen | Volkswagen: Individual consumer lacks standing under ODTPA | Dismissed — under binding precedent individual consumers may not bring ODTPA claims; statute targets commercial class |
| Product liability for damage to the product itself | Michelson: Count Three alleges design/manufacturing defect causing engine failure | Volkswagen: Plaintiff pleads only economic damage to the product and so statutory product-liability definitions do not apply | Dismissed — claims allege only economic/product damage, which is not recoverable under Ohio product-liability statute |
| Common-law negligent design / implied warranty | Michelson: Count Three alternatively sounds in implied warranty or negligent design | Volkswagen: Common-law product-liability claims have been abrogated; pleading lacks facts showing defect existed when vehicle left manufacturer | Dismissed — negligent-design/common-law product claims abrogated by R.C. 2307.71(B); implied-warranty claim fails for lack of factual support that defect existed when product left defendant |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading standard: courts need not accept legal conclusions)
- Curl v. Volkswagen of Am., Inc., 114 Ohio St.3d 266 (Ohio 2007) (recognizes manufacturer-based remedies such as warranty and product-liability claims)
- LaPuma v. Collinwood Concrete, 75 Ohio St.3d 64 (Ohio 1996) (economic loss to the product itself is not within statutory product-liability recovery)
- Carrel v. Allied Prods. Corp., 78 Ohio St.3d 284 (Ohio 1997) (held negligent-design common-law claim survived Products Liability Act)
- NorthPoint Properties v. Petticord, 179 Ohio App.3d 342 (Ohio Ct. App. 2008) (standard of review for Civ.R. 12(B)(6) dismissal)
- Grey v. Walgreen Co., 197 Ohio App.3d 418 (Ohio Ct. App. 2011) (12(B)(6) dismissal: plaintiff must show set of facts entitling to relief)