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Michelson v. Aktiengesellschaft

Court of Appeals of Ohio, Eighth District, Cuyahoga

April 5, 2018

DEBORAH J. MICHELSON PLAINTIFF-APPELLANT
v.
VOLKSWAGEN AKTIENGESELLSCHAFT, ET AL. DEFENDANTS-APPELLEES

          Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-17-876770

          David A. Kunselman, Deborah J. Michelson, Miller Goler Faeges Lapine, L.L.P. ATTORNEYS FOR APPELLANT

          Robert D. Kehoe, Kevin P. Shannon Kehoe & Associates, L.L.C.ATTORNEYS FOR APPELLEES

          BEFORE: Blackmon, J., McCormack, P.J., and Keough, J.

          JOURNAL ENTRY AND OPINION

          PATRICIA ANN BLACKMON, J.

         {¶1} Deborah J. Michelson ("Michelson") appeals from the trial court's decision granting Volkswagen Aktiengesellschaft, et al.'s ("Volkswagen") motion to dismiss for failure to state a claim upon which relief can be granted and assigns five errors for our review:

I. The trial court committed reversible error by dismissing Plaintiff-Appellant's well pled Complaint that alleged facts sufficient to satisfy Ohio's notice pleading standard on all counts.
II. The trial court committed reversible error by dismissing Plaintiff-Appellant's Complaint based on factual determinations whether Defendant-Appellees were "suppliers" that engaged in "consumer transactions" under Ohio's Consumer Sales Practices Act, Ohio Rev. Code 1345.01, et seq.
III. The trial court committed reversible error by wrongly determining that Ohio's Deceptive Trade Practices Act, Ohio Rev. Code 4165.01, et seq. applies only to commercial entities.
IV. The trial court committed reversible error by wrongly determining that purely economic damages are not recoverable under Ohio's cause of action for breach of implied warranty in tort and/or negligent design not sounding in product liability.
V. The trial court committed reversible error by failing to grant Plaintiff-Appellant leave to amend her Complaint pursuant to Ohio Civil Procedure Rule 15(A), to cure any perceived pleading deficiencies.

         {¶2} Having reviewed the record and pertinent law, we affirm the trial court's judgment. The apposite facts follow.

         {¶3} In May 2014, Michelson bought a 2009 Volkswagen CC Sport ("the Vehicle") in Cuyahoga County from an unnamed seller. In December 2016, when the Vehicle had approximately 90, 000 miles on it, the timing chain system failed, requiring replacement of the engine at a cost of more than $7, 000. On March 2, 2017, Michelson filed a complaint against Volkswagen alleging: 1) unfair and/or deceptive acts in violation of R.C. 1345.02(A); 2) deceptive trade practices in violation of R.C. 4165.02; and 3) design or manufacturing defects.[1]

         {¶4} The gist of Michelson's lawsuit, as evidenced by her complaint, her brief in opposition to Volkswagen's motion to dismiss, and her appellate briefs, is that "the Volkswagen Defendants manufactured and distributed a vehicle that they knew, or reasonably should have known, has serious manufacturing and design defects, including a defective timing chain system in the engine that makes the car highly unsafe

         {¶5} On May 31, 2017, the court granted Volkswagen's motion to dismiss under Civ.R. 12(B)(6) for failure to state a claim upon which relief can be granted. It is from this order that Michelson appeals. We address Michelson's assigned errors together when necessary.

         Standard of Review - Civ.R. 12(B)(6) Motion to Dismiss

Our standard of review on a Civ.R. 12(B)(6) motion to dismiss is de novo. A motion to dismiss for failure to state a claim upon which relief can be granted is procedural and tests the sufficiency of the complaint. Under a de novo analysis, we must accept all factual allegations of the complaint as true and all reasonable inferences must be drawn in favor of the nonmoving party.

         (Citations omitted.) NorthPoint Properties v. Petticord, 179 Ohio App.3d 342, 2008-Ohio-5996, 901 N.E.2d 869, ¶ 11 (8th Dist). For a trial court to grant a motion to dismiss for failure to state a claim upon which relief can be granted, it must appear "beyond doubt from the complaint that the plaintiff can prove no set of facts entitling her to relief." Grey v. Walgreen Co., 197 Ohio App.3d 418, 2011-Ohio-6167, 967 N.E.2d 1249, ¶ 3 (8th Dist).

         {¶6} Particular to this case, however, we note that under Civ.R. 12(B)(6), the court does not have to accept Michelson's legal conclusions as true. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ("the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.").

         Ohio Consumer Sales Practices Act

         {¶7} The Ohio Consumer Sales Practices Act ("CSPA") provides a remedy to consumers who are subject to unfair or deceptive practices by suppliers. Pursuant to R.C. 1345.02(A), "[n]o supplier shall commit an unfair or deceptive act or practice in connection with a consumer transaction."

         {¶8} In the case at hand, Michelson alleges that: 1) the supplier is Volkswagen; 2) the unfair or deceptive act is Volkswagen's "wrongfully and intentionally" concealing the "Timing Chain System Defect" from consumers "for many years, " despite Volkwagen's actual knowledge of the defect; and ...


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