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Mooradian v. FCA U.S. LLC

United States District Court, N.D. Ohio

October 27, 2017

DONNA MOORADIAN, ET AL. Plaintiffs,
v.
FCA US, LLC, Defendant.

          OPINION & ORDER [RESOLVING DOC. NO. 30]

          JAMES S. GWIN UNITED STATES DISTRICT JUDGE.

         Plaintiffs make claims that allege a manufacturing defect in 2012-2017 Jeep Wranglers.[1]Defendant FCA US, LLC (“FCA”) moves to dismiss Plaintiffs Donna and William Mooradian's and Plaintiff Joseph White's (collectively, “Plaintiffs”) complaint for failure to state a claim.[2]

         For the reasons below, the Court GRANTS IN PART and DENIES IN PART Defendant's motion to dismiss.

         I. Background

         A. The Manufacturing Process and Alleged Defect

         Defendant FCA US, LLC manufactures Jeep Wranglers.[3] When making the Wranglers' engines, FCA uses a sand-casting method to create some engine components and a die-casting method to create others. This sand-casting method “utilizes expendable sand molds to form complex metal parts from alloys.”[4]

         When manufacturing 2012-2017 Wranglers, FCA used a die-casting method to create the Wranglers' engine blocks, but used a sand-casting method to make the engine's cylinder head.[5]Any excess sand from this sand-casting method must be purged from the cylinder head, or it will gradually seep into other engine component parts.[6]

         Specifically, excess sand can “improperly circulate through the vehicle's cooling system and settle in the heater core, radiator, and oil cooling systems.”[7] Eventually, this excess sand forms a sludge in the bottom of the radiator reservoir that can cause the vehicle's heating and cooling systems to malfunction and fail.[8] This makes driving in extreme heat or cold potentially dangerous or impossible.[9]

         Plaintiffs allege that sand begins to shed from the engine cylinder head as soon as someone drives the vehicle, but this issue is only discovered once the heating and cooling systems fail. Moreover, normal maintenance, such as an engine flush, does not fix this problem.[10] This is because the sand-based sludge builds up at the bottom of the radiator, which an engine flush does not reach.[11] Additionally, sand continues to build up in the engine once the vehicle operates again.[12]

         Plaintiffs allege that Defendants' failure to adequately clean cylinder heads created a manufacturing defect in 2012-2017 Jeep Wranglers.

         FCA provides two relevant express warranties that cover 2012-2017 Jeep Wranglers. The 3-year/36, 000 mile “Basic Limited Warranty” “covers the cost of all parts and labor needed to repair any item” on the vehicle except “tires and Unwired [sic] headphones.”[13] The 5-year/100, 000 mile “Powertrain Limited Warranty” “covers the cost of all parts and labor needed to repair” a limited number of parts, including the engine cylinder head assemblies.[14]

         B. The Mooradians

         In July 2013, the Mooradians leased a new 2013 Jeep Wrangler Unlimited from an authorized Jeep dealer.[15] In October 2016, the heat in the Mooradians' Jeep only blew cold air from the vents, even though it was on the highest setting. The defroster also only emitted cold air, which caused the windshield to fog during use.[16]

         These problems continued, and in January 2017 the Mooradians took their Jeep to an authorized dealer to repair the Jeep's heater. The Jeep had 33, 000 miles at the time they took it to a dealer for repairs. The dealer told the Mooradians that they found a “sludge-like residue” in the radiator and oil cooler, which caused their vehicle's problems.[17]

         To repair this, the dealer replaced the radiator, oil cooler, and heater core at a cost of $2, 600. Neither of the Jeep's warranties covered this cost. After some negotiation, the Mooradians agreed to pay $300 for the repairs, and Jeep or the dealer covered the remaining $2, 300.[18]

         During this repair, the dealer did not fix any engine parts, including the engine's cylinder heads. The Mooradians have not alleged that their Jeep has had additional issues. They do, however, “fear that the component parts that were replaced are being damaged again.”[19]

         C. Plaintiff White

         Plaintiff White purchased a new 2013 Jeep Wrangler Unlimited from an authorized dealer in 2013. In June 2015, White's air conditioning did not emit sufficient air from the Jeep's vents.[20]

         When White took his Jeep for repair, the dealership solved the problem by flashing his air conditioning control head. The same problem arose in July 2016, and the dealer fixed the problem by replacing the blower motor in Plaintiff White's Jeep.[21]

         Plaintiffs allege that Defendant has breached its express and implied warranties by refusing to repair the defective cylinder heads, that Defendant was negligent in producing the cylinder heads, and that Defendant violated the Ohio Consumer Sales Practices Act (OCSPA).[22]Plaintiffs seek to certify a class of all model year 2012-2017 Jeep Wrangler owners in the United States, as well as a subclass of Wrangler owners in Ohio.[23]

         II. Legal Standard

         An action may be dismissed under Federal Rule of Civil Procedure 12(b)(6) if it fails to state a claim upon which a court can grant relief.[24] To survive a Rule 12(b)(6) dismissal, the complaint “must present ‘enough facts to state claim to relief that is plausible on its face'” when its factual allegations are presumed true and reasonable inferences are made in favor of the non-moving party.[25]

         Although federal pleading requirements do not require detailed factual allegations, “it is still necessary that the complaint contain more than bare assertions or legal conclusions.”[26] The complaint must allege sufficient facts to give “the defendant fair notice of what the . . . claim is and the grounds upon which it rests” and that “raise a right to relief above the speculative level.”[27]

         III. Analysis

         Defendant FCA argues that, for a variety of reasons, all of Plaintiffs' claims must be dismissed. The Court addresses each claim in turn.

         A. Breach of Express Warranties

         A claim for breach of express warranty under Ohio law requires a plaintiff to establish that: “(1) the item in question was subject to a warranty; (2) the item did not conform to the warranty; (3) the seller was given a reasonable opportunity to cure any defects; and (4) the seller failed to cure the defects within a reasonable period of time or after a reasonable number of attempts.”[28]

         For the reasons stated below, the Court GRANTS Defendant's motion to dismiss Plaintiff's breach of express warranty claim for failure to state a claim.

         1. Basic Limited and Powertrain Limited Warranties

         Plaintiffs allege that FCA breached its express warranties covering their Jeep Wranglers by failing to repair the defective cylinder heads.[29] FCA provides two potentially relevant express warranties, a 3 year/36, 000 mile “Basic Limited Warranty” and a longer 5 year/100, 000 mile “Powertrain Limited Warranty.”

         The Basic Limited Warranty “covers the cost of all parts and labor needed to repair any item” on the vehicle except “tires and Unwired [sic] headphones.”[30] The Powertrain Limited Warranty “covers the cost of all parts and labor needed to repair” a limited number of parts, including the cylinder head assemblies within the engine.[31]

         Defendant FCA argues that neither warranty covers Plaintiffs' claims. Defendant argues that none of Plaintiffs' vehicles required repair within either the time or mileage limit for the Basic Limited Warranty. Additionally, none of the repairs to Plaintiffs' vehicles involved any of the parts expressly enumerated in the Powertrain Limited Warranty.

         Regarding these two arguments, FCA misunderstands Plaintiffs' claims. Plaintiffs claim that the cylinder head, which is expressly covered by the longer Powertrain Limited Warranty, is defectively manufactured. The defect in that cylinder head then is argued to cause numerous other problems with the vehicle's heating and cooling systems. As such, Plaintiffs claim that a repair that looks only at the heating or cooling system problem is akin to putting duct tape over a broken window; fine for a day, but nothing remotely resembling an adequate permanent solution.

         FCA does not argue that the allegedly defective cylinder head was not covered by the longer Powertrain Limited Warranty when they sought repairs, or that the warranty has otherwise expired. Because Plaintiffs have alleged that Defendant FCA failed to repair a part covered by the still-in-effect Powertrain Limited Warranty, these arguments cannot defeat Plaintiffs' express warranty claim.

         2. Opportunity and Failure to Cure

         In order to state a claim for breach of warranty, Plaintiffs must have given Defendant FCA a reasonable opportunity to cure any defects, and Defendant must have failed to cure these defects.[32] The Mooradians took their vehicle in for one repair allegedly related to the manufacturing defect. White received two such repairs.[33] Apparently, both repairs worked. The Mooradians and White do not allege similar repair needs.

         Plaintiffs do not adequately allege that Defendant FCA has had sufficient opportunity to cure. For both the Mooradians and for White, the repairs seem to have fixed the problem. The Mooradians claim that after several months of poor vehicle heating, their Jeep was fixed in January 2017. They do not allege any later problems or expense.

         With regard to Plaintiff White, he alleges off-and-on air conditioning problems in 2015 and 2016. He then alleges that in July 2016 and after 64, 151 miles, he needed to replace the air conditioning blower motor.[34] He does not explain how the air conditioning blower motor replacement relates to any sand in the cylinder heads, and he does not allege that anyone told him that he had sand or sludge in his radiator. White does not allege any later problems or expenses.

         A defendant must be given at least two opportunities to cure a defect.[35] For that reason alone, the Mooradians' claim plainly fails. They have only received one repair, and that repair returned their car to working order for a substantial period of time, if not permanently.[36]

         Plaintiff White received two repairs related to the alleged defect. Plaintiff White's claim also fails, as “two repairs of the same item is not unreasonable pursuant to either a breach of warranty claim or the Magnuson-Moss Act.”[37] Additionally, Plaintiff White alleges no facts suggesting that his air conditioning problems were actually caused by the manufacturing defect, i.e. finding a sludge build-up, instead of the problems the dealer diagnosed and fixed.

         Besides this numerical deficiency, Plaintiffs' claim suffers from a more fundamental issue. No Plaintiff alleges that he took his vehicle to Defendant or its dealers complaining of the defective cylinder head and that Defendant refused the repair.

         Instead, Plaintiffs sought and received repairs for heating and air conditioning problems. Plaintiffs argue that even though the repairs they received solved their air conditioning- or heat-related issues temporarily, Defendant failed to remedy their claimed underlying sand problem. Although neither plaintiff alleges any additional problems, they argue issues will recur.

         These vague allegations might sustain a breach of warranty claim in some scenarios. It cannot sustain this allegation, however, for three reasons.

         First, the allegedly defective vehicles only required one or two repairs to return to full working order for a substantial length of time. Second, and relatedly, no Plaintiff actually received the same repair more than once. The Mooradians only ever received one repair, and Plaintiff White had his air conditioning control head unit flashed once, and his blower motor replaced once.[38]

         Finally, Plaintiffs do not allege that their vehicles currently exhibit any symptoms after their most recent repair.[39] Indeed, no Plaintiff has a history of needing repeated repairs to the allegedly affected components.

         As such, Plaintiffs have not given Defendant sufficient opportunity to cure.

         B. Failure of Essential Purpose, Unconscionability, and Pre-Suit Notice

         Even if Defendant has not explicitly breached its express warranties, Plaintiff claims that those warranties have failed their essential purposes or are unconscionable. For the following reasons, the Court disagrees.

         1. Failure of the Warranties' Essential Purpose

         Plaintiffs argue that Defendant FCA's express warranties have failed their essential purpose because the alleged manufacturing defect continues to manifest after they have taken their vehicles in for repairs. Plaintiffs' argument fails.

         When a warranty limits a plaintiff to a repair or replace remedy, that warranty fails its essential purpose when the warranted product remains defective even after numerous attempts at repair.[40]

         As explained above, no Plaintiff complained about the sand in the cylinder head manufacturing defect. Plaintiffs took their vehicles in for one or two repairs regarding alleged symptoms of the manufacturing defect, and Defendant fixed those symptoms.

         No Plaintiff alleges that any symptoms of the alleged defect have recurred since the most recent repair. This minimal number of potentially successful repairs after several years of use is a far cry from the vehicles “riddled with defects” that have caused courts to find the repair and replace remedy inadequate.[41]

         As such, neither the Basic Limited nor Powertrain Limited Warranties has failed its essential purpose. Plaintiffs' minimal repair history does not suggest a failure of these warranties' essential purposes. Indeed, any repairs to parts covered under the Basic Limited Warranty occurred after the 3 year/36, 000 mile limitation on that warranty, [42] and Plaintiffs have not sought a repair explicitly under the Powertrain Limited Warranty.

         2. Unconscionability

         Plaintiffs argue that the time limits on Defendant's warranties are unconscionable. Plaintiffs allege that Defendant FCA knew that the manufacturing defect would only become apparent to a consumer near or after the end of the express warranties, and Defendant FCA made false or misleading representations to hide the existence of the defect.

         In Ohio, “[a] warranty disclaimer that leaves a party with a defective product and no avenue for recourse against the manufacturer is unconscionable. However, a warranty in which the party disclaiming warranties or remedies assumes some form of responsibility for the performance or maintenance of the product in issue is not unconscionable.”[43]

         Each of the two warranties involved with this case provides a responsibility to repair or replace the covered parts for years or tens of thousands of miles. Additionally, although the manufacturing defect may only manifest after the expiration of the Basic Limited Warranty, each Plaintiff had years and tens of thousands of ...


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