Mui Ho v. Toyota Motor Corp.
931 F. Supp. 2d 987
N.D. Cal.2013Background
- Three named plaintiffs purchased Lexus RX-class vehicles (2004–2009) and sue on behalf of a class of buyers/lessees.
- Headlamp assemblies allegedly retain moisture leading to dim lighting or failure, creating safety risks and repair costs.
- Plaintiffs allege Defendants had exclusive access to pre-release testing data and internal complaints, yet did not disclose defects and issued only temporary fixes.
- Ho bought a used vehicle in 2007; Anglin bought new in 2006; Flory bought used in 2011; Ho experienced multiple headlamp repairs in 2008, 2010, 2012; Anglin faced repeated warranty disputes; Flory first complained in 2012.
- Plaintiffs asserted six claims: CLRA, UCL (including Secret Warranty Law), fraud by omission, Song-Beverly implied warranty, and express warranty (against TMS). The Secret Warranty UCL claim was later withdrawn.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Implied warranty breach under Song-Beverly for Ho | Ho purchased used vehicle with implied warranty continuing. | Song-Beverly implied warranty duration for used goods limited; Ho may be outside period. | Ho’s implied warranty claim dismissed with leave to amend. |
| Breach of express warranty under NVLW for Ho and Anglin | NVLW constitutes an affirmation of fact/basis of bargain; defendants breached by defective replacements and non-repair. | Ho’s 2008 repair fell within NVLW; later issues outside period; Anglin’s claim may proceed. | Ho’s express warranty claim dismissed with prejudice; Anglin's claim denied for dismissal and allowed to proceed. |
| Fraud claims (CLRA and fraud by omission) viability | Defendants failed to disclose headlamp issues, violating CLRA and aiding fraud by omission. | Materiality and duty to disclose must be pled with specificity; data may be non-dispositive. | CLRA and fraud by omission claims survive (denied dismissal). |
| Unlawful, unfair, and fraudulent UCL claims viability | Defendants’ concealment of defect violates public policy and CLRA; misrepresentation theory supports prongs. | Unfairness standard contested; some claims rely on implied safety disclosures. | UCL claims survive (unimpacted). |
| Leave to amend for Ho’s implied warranty within period | Ho could amend to plead timely purchase within Song‑Beverly period. | Amendment may be futile if facts cannot establish timely purchase. | Plaintiffs have 30 days to amend Ho's implied warranty claim; otherwise dismissal with prejudice. |
Key Cases Cited
- Daugherty v. American Honda Motor Co., Inc., 144 Cal.App.4th 824 (Cal. Ct. App. 2006) (duty to disclose includes safety considerations; materiality required for omissions)
- Bardin v. DaimlerChrysler Corp., 136 Cal.App.4th 1255 (Cal. Ct. App. 2006) (safety-related omissions may trigger disclosure duty)
- Greenman v. Yuba Power Prods., Inc., 59 Cal.2d 57 (Cal. 1963) (timely notice not required when suing manufacturer for defects purchased from dealer)
- Keegan v. American Honda Motor Co., Inc., 838 F.Supp.2d 929 (C.D. Cal. 2012) (notice-to-manufacturer prerequisite waived when plaintiff sues manufacturer for dealer-bought vehicle)
- Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liab. Litig., 754 F.Supp.2d 1145 (C.D. Cal. 2010) (notice requirement excused for plaintiffs who bought from dealer; manufacturer not dealt with directly)
- Falk v. General Motors Corp., 496 F.Supp.2d 1088 (N.D. Cal. 2007) (safety-related omissions may create duty to disclose; expert theories on disclosure)
- Smith v. Ford Motor Co., 749 F.Supp.2d 980 (N.D. Cal. 2010) (analysis of when safety risk suffices for duty to disclose)