MEMORANDUM OPINION AND ORDER
Pending before the Court is Defendant Ford Motor Company’s Motion to Dismiss. ECF No. 34. The Court held a hearing on the matter on February 6, 2014. For the following reasons, the Court GRANTS, IN PART, and DENIES, IN PART, Ford’s motion.
I.
FACTS
On March 28, 2013, Plaintiffs filed a 135 page Class Action Complaint against Defendant Ford Motor Company. In their Complaint, Plaintiffs assert they purchased or leased Ford vehicles in West Virginia, Florida, Illinois, Maryland, Massachusetts, Michigan, Missouri, New York, North Carolina, Oklahoma, Pennsylvania, South Carolina, Virginia, and Wisconsin.
At the hearing, Plaintiffs explained the ETC system receives and sends data to various components and sensors in the vehicles, which includes opening and closing
1.The electronics do not properly communicate in a fault tolerant manner:
a.The ETCS can only detect a single point of failure which results in an unwanted open throttle. (¶ 172)
b. The accelerator pedal sensors are designed to ignore one of the sensor signals which can result in an open throttle. (¶ 173)
c. The ETCS improperly goes into and out of limp home mode resulting in an[ ] open throttle (¶¶ 172, 173,174)
2. The failsafe limp home mode is unreliable. (For example, the signal for the diagnostic trouble code can indicate that the limp home mode should trigger but does not) (¶¶ 10, 136, 172, 173,174)
3. The ETCS is a safety critical system which does not work — the lack of a Brake-Over Accelerator is just one aspect of its defective condition (¶¶100, 106, 131, 132, 133, 134, 137)
Plaintiffs assert that Ford’s failure to equip its ETC vehicles with a failsafe system rendered the vehicles unreasonably dangerous and defective at the time of purchase. As a result, Plaintiffs allege they have suffered economic damages because they paid more to purchase or lease the vehicles than their actual worth.
STANDARD OF REVIEW
In Bell Atlantic Corp. v. Twombly,
In Ashcroft v. Iqbal,
III.
DISCUSSION
A.
Failure to Adequately Allege a Defect
Ford first argues that the entire Complaint must be dismissed because Plaintiffs have failed to allege any specific design or manufacturing defect in the ETC system which makes its vehicles susceptible to sudden unintended acceleration events. Instead, Ford argues, these claims are made in a conclusory fashion and cannot survive scrutiny under Rule 12(b)(6). For instance, Ford asserts Plaintiffs merely allege that a sudden unintended acceleration “may” be caused by electro-magnetic interference without identifying any specific defect. Ford argues that Plaintiffs’ failure to identify any specific design defect with the ETC system makes their claims insufficient under Iqbal and Twombly. Upon review of the Complaint, the Court disagrees.
The Court finds Ford’s argument mis-frames Plaintiffs’ real claim of defect in this case. It is true that Plaintiffs allege there may be a malfunction in the ETC system for a variety of reasons. However, Plaintiffs’ claim of defect is that, when there is a malfunction, the ETC system itself is defective because it only is designed to detect a single point of failure, depriving the operator of control over the throttle and allowing the throttle to remain open and result in a sudden unintended acceleration. Plaintiffs assert the ETC system could and should have been designed in such a way to detect multiple faults at the same time, and Ford should have added failsafes, such as a BOA system, to give control of the throttle back to the driver if a sudden unintended acceleration occurs. In other words, Plaintiffs’ assertion is that the ETC system’s ability
Ford also insists that Plaintiffs’ claims fail because the BOA driver assistance feature is not designed to address any alleged defect with the ETC system. Rather, the feature is designed to address mechanically entrapped gas pedals, such as when a car mat gets stuck on top of the gas pedal. Ford argues Plaintiffs fail to allege how the addition of a BOA system, designed to address mechanical entrapments, would address an unwanted acceleration allegedly caused by some defect in the ETC system. Ford argues it is not defective for the vehicles at issue not to be equipped with a BOA system because it was designed for a completely different purpose.
However, Plaintiffs claim that a BOA system is one of the failsafes Ford could have installed that would allow a driver to “cancel unwanted torque commands, regardless of the origin, and limit the amount of engine torque by depressing the brake pedal, thereby permitting the brakes to slow the vehicle.” Compl. at ¶ 92, in part. In other words, even though the BOA system was originally designed to help in instances of mechanical entrapment, Plaintiffs assert it also can help if there is a sudden unintended acceleration caused by the defect in the ETC system. Plaintiffs allege Ford knew the ETC system was defective and should have installed a failsafe, such as a BOA system, which would allow a driver to retake control of the throttle. Id. at ¶ 177. Thus, given these allegations, the Court rejects Ford’s argument that the Complaint must be dismissed because the BOA system was not originally designed to mitigate an alleged defect with the ETC system.
Ford further argues the Complaint must be dismissed because it was not required to equip its vehicles with the most advanced safety features. Ford asserts the fact a product can be made safer does not establish the product is automatically defective if that safety feature is not added. Consumers are free to choose from a variety of models and safety features when they purchase an automobile. As a general proposition, the Court agrees with Ford that it is not required to install the most advanced optional safety features on its vehicles. See, e.g., Sexton By and Through Sexton v. Bell Helmets, Inc.,
B.
Manifestation
Ford next argues that, even if the Court finds Plaintiffs have properly al
Ford argues that the prevailing view of courts across the county is that plaintiffs may not recover for lost value if they have not experienced a manifestation of the defect which resulted in injury. On the other hand, Plaintiffs assert that, because the defect with the ETC system existed at the time the vehicles were manufactured, the defect already had manifested itself and, thus, they are entitled to collect for their economic loss for diminished value at the time of purchase.
In support of its argument, Ford first points to the Eighth Circuit Court of Appeals decision in Briehl v. General Motors Corp.,
On appeal, the Eighth Circuit agreed with the district court and held: “Where, as in this case, a product performs satisfactory and never exhibits an alleged defect, no cause of action lies. Since the Plaintiffs have failed to allege any manifest defect and their vehicles perform in a satisfactory manner, the District Court was correct when it dismissed the Plaintiffs’ Original Complaint.” Id. at 628 (footnote omitted). The Eighth Circuit further held the plaintiffs’ claim that they suffered a loss in resale value was too speculative and insufficient as a matter of law because they did not assert that any of them actually sold a vehicle for a reduced price, nor did they otherwise allege the amount of their damages. Id. at 628-29.
Following the Court’s hearing on the pending motion, Plaintiffs submitted a supplemental pleading citing In re Zurn Pex Plumbing Products Liability Litigation,
Taking a slightly different approach than Briehl and applying South Carolina law, the Fourth Circuit also addressed the issue of lost value in Carlson v. General Motors Corp.,
Similarly, the district court for the Southern District of New York discussed an economic loss theory in Weaver v. Chrysler Corp.,
More recently, in Wilson v. Style Crest Products, Inc.,
Plaintiffs, however, argue it is unnecessary for them to allege there was a sudden unintended acceleration in order for them to proceed on their theory that they did not receive the benefit of their bargain and paid too much for their vehicles. In support, Plaintiffs rely upon In re Bridgestone/Firestone, Inc.,
Turning to Michigan and Tennessee law,
On interlocutory appeal on a choice of law question and a class certification issue, the Seventh Circuit reversed the district court. In doing so, the Seventh Circuit noted the class plaintiffs effectively consisted of only those consumers who did not experience tire failure or vehicle rollover. Instead, the “[p]laintiffs describe[d] the injury as financial rather than physical and seek to move the suit out of the tort domain and into that of contract (the vehicle was not the flawless one described and thus is not merchantable, a warranty theory) and consumer fraud (on the theory that selling products with undisclosed attributes, and thus worth less than represent
Although the Seventh Circuit declined to actually decide whether Michigan and Tennessee law would allow the plaintiffs’ claim for damages for lost resale value to proceed, its critique of the issue certainly raises doubts as to the sustainability of the plaintiffs’ theory. In addition, this Court is unconvinced that the district court’s analysis in Bridgestone should apply here. The Court finds unpersuasive the district court attempt to distinguish the weight of authority from other jurisdictions by stating that, “[w]hile couched in terms of whether manifest injury must be pled, the real ground for dismissing most of the cases ... that are contrary to our conclusion on this point was that the defective products that the plaintiffs had purchased performed satisfactorily throughout their useful life[.]”
Plaintiffs also point to Lloyd v. General Motors Corp.,
In reaching its conclusion, the court recognized a very limited exception in Maryland to the general rule that economic losses are not recoverable in tort actions. The court quoted a 1994 decision in which it held: “ ‘Even when a recovery, based on a defective product, is considered to be for purely economic loss, a plaintiff may still recover in tort if this defect creates a
Relying upon its previous decision in Council of Co-Owners Atlantis Condominium, Inc. v. Whiting-Turner Contracting Co.,
In applying these elements to the facts before it, the court found the plaintiffs sufficiently alleged extremely serious injuries had resulted from the defective seat-backs, “including paraplegia, quadriplegia and/or death” to allow for economic recovery. Id. at 270. In addition, the court found the plaintiffs alleged sufficient facts that the probability of damage was serious, in that the plaintiffs “alleged that thousands of individuals have been injured or killed as a result of the collapse of the class vehicle seatbacks in rear-end collisions.” Id. The plaintiffs included specific records from the National Highway Traffic Safety Administration (NHTSA), reporting at least 38 injuries and 3 fatalities have resulted from collapsed seatbacks. Id. Therefore, the court found the plaintiffs could pursue negligence, strict liability, and negligent misrepresentation claims. Id. at 271-74. The court also found the plaintiffs alleged sufficient facts to prevent dismissal of their fraudulent concealment, consumer protection, and civil conspiracy claims. Id. at 284-85.
Relying upon these same allegations, the court also found the plaintiffs could maintain a contract claim for a breach of implied warranty of merchantability. The court specifically distinguished the facts of the case before it from Briehl, Carlson, and the other jurisdictions which do not allow economic loss in implied warranty cases absent an actual injury by noting that the majority of those cases found the alleged injuries were “merely speculative” and represented a “potential injury in the future or a purely speculative fear of such injury.” Id. at 292 (italics original). The Lloyd court found there was no discussion in those cases in which courts discussed “whether the plaintiffs submitted any objective facts that a significant number of
In comparing Lloyd to the present case, the Court finds Plaintiffs have not alleged the same objective evidence demonstrating “a substantial, clear and unreasonable risk of death or personal injury”
Upon review, the Court finds these allegations fall far short of the type of allegations the plaintiffs made in Lloyd in which they alleged the defective seatbacks caused very specific catastrophic injuries and death. In addition, as to the probability of such damages occurring, the plaintiffs in Lloyd quoted the NHTSA figures reporting at least 38 injuries and 3 fatalities. Lloyd,
The Court also finds the decision in In re Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liability Litigation,
Thus, upon review of the preceding cases, the Court finds the cases cited by Plaintiffs are inapposite to the warranty claims of those Plaintiffs who have not experienced a sudden unintended acceleration. Instead, these claims are much more closely aligned with those cases which have found no warranty claim exists under these circumstances. Accordingly, as to those Plaintiffs who have not alleged that they have experienced a sudden unintended acceleration, the Court GRANTS Ford’s Motion to Dismiss their warranty claims as the Court has not found any comparable cases that have allowed such claims to survive. Plaintiffs simply have failed to demonstrate a plausible claim that they paid more for their vehicles than their actual worth when they have used their vehicles without incident for many years. However, as to the two Plaintiffs who have experienced a sudden unintended acceleration, the Court finds they have stated a plausible claim for relief as they allege they have experienced a manifestation of the purported defect. Therefore, the
C.
Fraud
In their Complaint, Plaintiffs make a number of fraud-based claims and other claims which sound in fraud. They also assert the statute of limitations on some of their claims should be extended because of fraudulent concealment. However, Ford argues Plaintiffs have failed to allege any fraudulent conduct with the specificity required by Rule 9(b) of the Federal Rules of Civil Procedure and, therefore, the fraud-based claims must be dismissed and the other fraud-related allegations must be ignored as insufficient.
Rule 9(b) provides, in part: “In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake.” Fed. R.Civ.P. 9(b), in part. The Fourth Circuit has explained that this means a plaintiff must plead “the time, place, and contents of the false representations, as well as the identity of the person making the representation and what he obtained thereby.” Harrison v. Westinghouse Savannah River Co.,
“First, the rule ensures that the defendant has sufficient information to formulate a defense by putting it on notice of the conduct complained of ... Second, Rule 9(b) exists to protect defendants from frivolous suits. A third reason for the rule it to eliminate fraud actions in which all the facts are learned after discovery. Finally, Rule 9(b) protects defendants from harm to their goodwill and reputation.”
Id. (quoting United States ex rel. Stinson, Lyons, Gerlin & Bustamante, P.A. v. Blue Cross Blue Shield of Georgia, Inc.,
In the Complaint, each individual Plaintiff has a similar general allegation in support of their claims. For instance, with respect to Plaintiff Belville, the Complaint provides:
Plaintiff Belville saw advertisements for and representations about Lincoln vehicles on television, in magazines, on billboards, in brochures at the dealership, on window stickers, and on the Internet during the several years before he purchased his Town Car in or about January 2008. Although Plaintiff Bel-ville does not recall the specifics of the many Lincoln advertisements he saw before he purchased his Town Car, he does recall that safety and reliability were very frequent themes across the advertisements he saw. Those advertisements about safety and reliability influenced his decision to purchase his Town Car. Had those advertisements and any other materials Plaintiff Belville saw disclosed that Ford Vehicles could accelerate suddenly and dangerously out of the driver’s control, and lacked adequate fail-safe systems to prevent this, he would not have purchased this Town Car, or certainly would not have paid as much for it as he did.
First, although Plaintiffs identify in paragraphs 112-127 of the Complaint various reports, advertisements, and statements made by Ford, no Plaintiff states he or she actually saw, heard, or relied upon any of those specific reports, advertisements, or statements in deciding to buy a Ford vehicle. Instead, they allege they were influenced by frequent themes of safety and reliability in advertisements over a period of several years. Merely stating there were “themes” of safety and reliability over a period of years, however, does not meet the heightened pleading standard under Rule 9(b) to support a fraud claim. Rule 9(b) very clearly requires Plaintiffs to state with particularity “the time, place, and contents of the false representations”
Second, looking at the various reports, advertisements, and statements quoted by Plaintiff in paragraphs 112 through 127 of the Complaint, the Court finds most are mere puffery and cannot give rise to an actionable fraud claim— even if Plaintiffs would have alleged they recalled reading or hearing those specific quotes. For instance, in paragraph 112, Plaintiffs allege “in its 2004 Annual Report, Ford stated: “We conduct engineering, research and development primarily to improve the performance (including fuel efficiency), safety and customer satisfaction of our products, and to develop new products.’ ” Compt at ¶ 112. Similarly, in paragraph 113, Plaintiffs claim Ford stated in a 2004 press release that “it was ‘underscoring its commitment to safety leadership.’ ” Id. at ¶ 113. There is simply nothing in these statements, however, that can serve the basis for Plaintiffs’ fraud claims.
In In re General Motors Corp. Anti-Lock Brake Products Liability Litigation,
The present case contains the same problem. Even if the Court were to assume, without deciding, that some of the statements extend beyond the realm of puffery and convey misrepresentations,
D.
Fraudulent Concealment
Ford further argues that Plaintiffs have failed to plead fraudulent concealment with the specificity required under Rule 9(b). The district court in Weaver was asked to address a similar issue where the plaintiff alleged that Chrysler’s advertisements spoke as to the quality of its vehicles, but it did not inform the public of a defect in the integrated child seat.
For the reasons stated above, Plaintiffs in the present case suffer the same fatal flaw. Although Plaintiffs do quote various promotional material in paragraphs 112-127 of the Complaint, Plaintiffs do not say they ever saw, read, or heard these particular statements by Ford. Therefore, the Court grants Ford’s argument to dismiss any claims based upon fraudulent concealment. In addition, the Court will not extend the statute of limitations on the basis of fraudulent concealment.
E.
Unjust Enrichment
Ford next argues that Plaintiffs’ claims for unjust enrichment should be dismissed for those individuals who bought their vehicles used because their purchase did not bestow any benefit on Ford. As an initial matter, the Court finds that, for the same reasons stated with respect to Plaintiffs’
The only remaining unjust enrichment claim Ford argues should be dismissed, in which it is alleged there was sudden unintended acceleration, is the claim by the Pattons. According to the Complaint, the Pattons purchased a 2006 Lincoln Town Car on or about July 18, 2009, from Greenbrier Dodge, located in Chesapeake, Virginia. Compl. at ¶¶ 65-66. The statute of limitations on a claim for unjust enrichment in Virginia, however, is three years. See Ghiorzi v. B & B Builders & Remodelers, Inc., Civ. Act. No. 68466,
F.
Request for Injunctive Relief
Lastly, Ford argues this Court should dismiss Plaintiffs’ request for injunctive relief pursuant to the primary jurisdiction doctrine. Plaintiffs request an injunction be issued to prevent Ford “from continuing the unfair business practices alleged in this Complaint and requiring Defendant to institute a recall or free replacement program[.]” Compl. at ¶ 2 of Request for Relief. Ford asserts that the NHTSA is much better equipped to investigate the alleged defect and assess the need for and oversee any vehicle recalls. However, at this point in the proceedings, the Court finds no reason to defer to the NHTSA. The claims currently before the Court are individual claims based upon breach of warranty and a variety of state-law causes of action, which this Court is well-equipped to handle. Whether or not this Court should or will issue a nationwide recall or free replacement program is an issue better addressed at a later time. Thus, the Court DENIES WITHOUT PREJUDICE Ford’s motion in this regard.
IV.
CONCLUSION
Accordingly, for the foregoing reasons, the Court GRANTS, in part, and DENIES, in part, Ford’s motion. The Court will enter an Order with respect to further scheduling of the remaining matters in this case in the near future.
The Court DIRECTS the Clerk to send a copy of this Order to counsel of record and any unrepresented parties.
Notes
. All the named Plaintiffs either purchased or leased a Ford vehicle in the State in which they either reside or are located except for Plaintiffs Charles Johnson and Mills Allison, who are both residents of California, and Josh Legato, who is a resident of Kansas. Mr. Johnson leased his vehicle from a dealership in Maryland, Mr. Allison purchased his vehicle in South Carolina, and Mr. Legato purchased his vehicle in Missouri.
. Plaintiffs specific claims are as follows: Count 1 — Violation of the Magnuson-Moss Warranty Act; Count 2 — Breach of Express Warranty on behalf of the West Virginia State Class; Count 3 — Breach of Implied Warranty of Merchantability on behalf of the West Virginia State Class; Count 4 — Unjust Enrichment on behalf of the West Virginia State Class; Count 5 — Violation of the Florida Deceptive and Unfair Trade Practices Act on behalf of the Florida State Class; Count 6— Breach of Express Warranty on behalf of the Florida State Class; Count 7 — -Fraud by Concealment brought on behalf of the Florida State Class; Count 8 — Violation of the Illinois Consumer Fraud and Deceptive Business Practices Act on behalf of the Illinois State Class; Count 9 — Violation of the Illinois Uniform Deceptive Trade Practices Act in violation of the Illinois State Class; Count 10— Breach of Express Warranty on behalf of the Illinois State Class; Count 11 — Unjust Enrichment on behalf of the Illinois State Class; Count 12 — Fraudulent Concealment on behalf of the Illinois State Class; Count 13 — Violation of the Maryland Consumer Protection Act on behalf of the Maryland State Class; Count 14 — Breach of Express Warranty on behalf of the Maryland State Class; Count 15 — Unjust Enrichment on behalf of the Maryland State Class; Count 16 — Breach of Express Warranty on behalf of the Massachusetts State Class; Count 17 — Unjust Enrichment on behalf of the Massachusetts State Class; Count 18— Violation of the Michigan Consumer Protection Act on behalf of the Michigan State Class; Count 19 — Breach of Implied Warranty of Merchantability on behalf of the Michigan State Class; Count 20 — Violation of the Missouri Merchandising Practices Act on behalf of the Missouri State Class; Count 21— Breach of Express Warranty on behalf of the Missouri State Class; Count 22- — Breach of Implied Warranty of Merchantability on behalf of the Missouri State Class; Count 23 — • Fraud by Concealment on behalf of the Missouri State Class; Count 24 — Unjust Enrich
. The two Plaintiffs who experienced a sudden unintended acceleration in this action are Roofwerks, Inc. in North Carolina and the Pattons in Virginia.
. Ford moved to strike this supplemental pleading. ECF No. 83. The Court denies the motion by a separate order.
. The Eight Circuit distinguished In re Zurn from O'Neil v. Simplicity, Inc.,
. See also Rule v. Fort Dodge Animal Health, Inc.,
. A second class of plaintiffs included purchasers and lessees of Ford Explorers, regardless of the tires. Plaintiffs alleged Explorers
. The district court looked to the law of these two states because they were the principal place of business for Ford and Firestone, respectively. Id. at 1077.
. This section specifically provides:
A cause of action accrues when the breach occurs, regardless of the aggrieved party's lack of knowledge of the breach. A breach of warranty occurs when tender of delivery is made, except that where a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance the cause of action accrues when the breach is or should have been discovered.
UCC § 2-725(2) (codified at Mich. Comp. Laws § 440.2725(2) and Tenn.Code Ann. § 47-2-725(2)).
.The district court noted that "the nature of injury required to maintain a cause of action differs depending upon the legal theory asserted[.]” Id. at 1086. With respect to the plaintiffs negligence/product liability claim, the district court granted dismissal to all but three of the plaintiffs because they failed to claim an injury to person or property. Id. at 1086 & 1089 (citing, inter alia, Weaver and Willett v. Baxter Int'l, Inc.,
. In note 1, the Seventh Circuit used an example to explain the economic theory behind the overcompensation by example. The court described how compensating a buyer for a “risk of failure” over compensates the class of buyers and results in excess precautions. Id. at 1017 n. 1.
. In fact, the Seventh Circuit pointed out that "[m]any class members face no future threat of failure either, because about 30 million tires were recalled and replaced, while other tires have been used up and discarded.” Id.
. Id. at 266.
. The Complaint provides that "[o]ne or more of Roofwerks, Inc.’s drivers has experienced unintended acceleration events in the F-250, specifically when using the cruise control or after pressing the accelerator to speed up. Upon releasing the accelerator the truck would continue to accelerate once the pedal was released.” Compl. at ¶ 52. The other named Plaintiffs are the Pattons who assert that "[djuring their ownership of this Lincoln Town Car, Plaintiffs Patton have experienced instances where the vehicle suddenly accelerated. These incidents typically have occurred at fairly low speeds and when other vehicles were very close. To prevent accidents, it has been necessary to press extremely hard on the brake pedal and in a couple of instances to also shift into neutral.” Id. at ¶ 68.
.As the proposed class includes vehicles manufactured between 2002 and 2010 and the data collected for the report began in 2002, it is highly likely that vehicles manufactured prior to 2002 are included in the OIG's figures.
. Details such as the year and model of the vehicle and when the vehicle was purchased or leased vary amongst each Plaintiff.
. Harrison,
. The material quoted by the court were statements made by GM that it "estimated that crash-avoidance systems, such as anti-lock brakes, ‘[are] 99 percent more effective
.See Dunn v. Borta,
. The tort of fraudulent misrepresentation (deceit) is defined by the Restatement (Second) of Torts, § 525 as follows: "One who fraudulently makes a misrepresentation of fact, opinion, intention or law for the purpose of inducing another to act or to refrain from action in reliance upon it, is subject to liability to the other in deceit for pecuniary loss caused to him by his justifiable reliance upon the misrepresentation.”
. In addition, the Court notes that Plaintiffs’ earliest specific example of a statement made by Ford was the 2004 Annual Report. However, at least one Plaintiff, Charles Johnson,
. Specifically, Ford asserts the following counts are barred by the statute of limitations:
2. Breach of Express Warranty on behalf of the West Virginia State Class;
3. Breach of Implied Warranty of Merchantability on behalf of the West Virginia State Class;
10. Violation of Express Warranty on behalf of the Illinois State Class;
14. Breach of Express Warranty on behalf of the Maryland State Class;
41. Breach of Express Warranty on behalf of the Pennsylvania State Class;
42. Breach of Implied Warranty of Merchantability on behalf of the Pennsylvania State Class;
43. Unjust Enrichment on behalf of the Pennsylvania State Class;
51. Unjust Enrichment on behalf of the Virginia State Class; and
52. Violation of the Wisconsin Deceptive Trade Practices Act on behalf of the Wisconsin State Class.