Polselli vs. Jaguar Land Rover North America, LLC

relationship between the parties, such as ‘between seller and buyer, employer and prospective employee, doctor and patient, or parties entering into any kind of contractual agreement. [Citation.] All of these relationships are created by transactions between parties from which a duty to disclose facts material to the transaction arises under certain circumstances.’...’Such a transaction must necessarily arise from direct dealings between the plaintiff and the defendant; it cannot arise between the defendant and the public at large.’” (Rattagan v.

Uber Technologies, Inc. (2024) 17 Cal.5th 1, 40-41; see Blickman Turkus, LP v. MF Downtown Sunnyvale, LLC (2008) 162 Cal.App.4th 858, 867 [“A duty to speak may arise in four ways: it may be directly imposed by statute or other prescriptive law; it may be voluntarily assumed by contractual undertaking; it may arise as an incident of a relationship between the defendant and the plaintiff; and it may arise as a result of other conduct by the defendant that makes it wrongful for him to remain silent.”].)

“There are ‘four circumstances in which nondisclosure or concealment may constitute actionable fraud: (1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material facts. [Citation.]’” (LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336, citing Heliotis v. Schuman (1986) 181 Cal.App.3d 646, 651.)

As the Court of Appeal explained in Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276 (Bigler-Engler), our Supreme Court has described the relationship necessary to give rise to a duty to disclose as a “transaction” between the plaintiff and defendant. “In transactions which do not involve fiduciary or confidential relations, a cause of action for non-disclosure of material facts may arise in at least three instances: (1) the defendant makes representations but does not disclose facts which materially qualify the facts disclosed, or which render his disclosure likely to mislead; (2) the facts are known or accessible only to defendant, and defendant knows they are not known to or reasonably discoverable by the plaintiff; (3) the defendant actively conceals discovery from the plaintiff.” (Id. at p. 311, quoting Warner Construction Corp. v.

City of Los Angeles (1970) 2 Cal.3d 285, 294, footnotes omitted.) However, “[s]uch a transaction must necessarily arise from direct dealings between the plaintiff and the defendant; it cannot arise between the defendant and the public at large.” (Bigler-Engler, supra, 7 Cal.App.5th at p. 312.)

This case is distinguishable from Bigler-Engler. The Complaint does not allege merely a relationship between Manufacturer and the public at large. Rather, the Complaint alleges that, on or about February 3, 2024, Plaintiff entered into a warranty contract with Manufacturer regarding the Subject Vehicle, a 2024 Land Rover Range Rover manufactured and/or distributed by Manufacturer. (Complaint, ¶ 7.) The Complaint further alleges that the warranty contract contained various warranties, including bumper-to-bumper, powertrain, and emission warranties. (Id., ¶ 8.)

This conclusion is supported by Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828 (Dhital). In Dhital, a Song-Beverly action involving a fraudulent concealment claim, the Court of Appeal rejected the manufacturer’s argument that the plaintiffs failed to allege a buyer-seller relationship because they purchased the vehicle from a dealership rather than directly from the manufacturer. (Id. at p. 844.) The court found the allegations sufficient at the pleading stage because the plaintiffs alleged they bought the vehicle from a Nissan dealership, Nissan backed

the vehicle with an express warranty, and Nissan’s authorized dealerships were its agents for purposes of selling Nissan vehicles to consumers. (Ibid.)

Similarly here, Plaintiff alleges more than a relationship with the public at large. Plaintiff alleges that Manufacturer manufactured and/or distributed the Subject Vehicle, issued written warranties, and was engaged in the business of designing, manufacturing, marketing, distributing, and selling automobiles and motor vehicle components. (Complaint, ¶¶ 4, 7-8.) Plaintiff also alleges that Manufacturer’s authorized dealers were its agents for vehicle repairs, that Manufacturer monitored warranty claims and repair records through its computer systems, and that Manufacturer communicated with its authorized dealers regarding malfunctions and repairs. (Id., ¶¶ 57, 64-65.)

Although the Complaint does not allege the same sales-agency facts present in Dhital, these allegations are sufficient at the pleading stage to allege a relationship between Plaintiff and Manufacturer giving rise to a duty to disclose.

Thus, the demurrer on this ground is overruled.

ii. Specificity

Defendants also argue the fraudulent concealment claim fails because it lacks factual specificity.

“[T]he elements of an action for fraud and deceit based on a concealment are: (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” (Boschma v. Home Loan Center, Inc. (2011) 198 Cal.App.4th 230, 248; Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 843.)

From a pleading perspective, the facts that constitute the fraud must be alleged fully, factually, and specifically. (Wilhelm v. Pray, Price, Williams & Russell (1986)186 Cal.App.3d 1324, 1331; see Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 843-844 [“Fraud, including concealment, must be pleaded with specificity”].) The particularity requirement necessitates the pleading of facts that show how, when, where, to whom and by what means the representation was tendered, and pleading specifically the detriment proximately caused by the defendant’s conduct. (Service of Medallion, Inc. v.

Clorox Co. (1996) 44 Cal.App.4th 1807, 1818; Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 73.) “[H]owever ... fraud is the only remaining cause of action in which specific pleading is required to enable the court to determine on the basis of the pleadings alone whether a foundation existed for the charge and, even in the pleading of fraud, the rule is relaxed when it is apparent from the allegations that the defendant necessarily possesses knowledge of the facts.” (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 47.)

An exception to the strict pleading standard is recognized when it appears the facts lie more within defendant’s knowledge than plaintiff’s, i.e., less specificity is required where “defendant must necessarily possess full information concerning the facts of the controversy.” (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 216, superseded by statute, on other grounds, as discussed in Sanchez v. Bear Stearns Residential Mortg. Corp.

(S.D.Cal. May 11, 2010, No. 09-CV-2056 JLS (CAB)) 2010 U.S.Dist.LEXIS 46043, at *18, fn. 4 [with the November 2, 2004 enactment of Proposition 64, a private person suing must have suffered damages to have standing to bring suit pursuant to section 17200 of the Business & Professions Code]; see Miles v. Deutsche Bank Nat’l Trust Co. (2015) 236 Cal.App.4th 394, 403-404 [omission of names of mortgage servicer employees and their authority to speak not fatal to fraud claim where defendants had more knowledge of the facts than did plaintiffs]; Tenet Healthsystem Desert, Inc. v. Blue Cross of Calif. (2016) 245 Cal.App.4th 821, 840 [complaint need not specify information uniquely within defendants’ knowledge, such as who prepared documents in question].)

Here, the Complaint alleges sufficient facts to plead fraudulent concealment at the pleading stage.

The Complaint alleges Manufacturer concealed a known defect from Plaintiff, namely that the 3.0L engine and/or related components installed in the Subject Vehicle suffer from one or more defects that can result in loss of power, stalling, rough running, engine misfires, engine failure, or engine replacement. (Complaint, ¶¶ 52-53.) Plaintiff further alleges the Engine Defect causes unsafe conditions, including the engine losing power while driving, which may impair the driver’s ability to control the vehicle and increase the risk of accident, property damage, personal injury, or death. (Id., ¶ 55.)

The Complaint also alleges Manufacturer knew or should have known of the Engine Defect before sale through exclusive, non-public internal data, including pre-release testing data, early consumer complaints to Manufacturer’s dealers, dealer repair orders, testing conducted in response to complaints, failure rates and replacement part sales data, aggregate dealer data, warranty claims, and repair records. (Complaint, ¶¶ 57, 62-65.) Plaintiff alleges Manufacturer had superior and exclusive knowledge of the Engine Defect, knew the defect was not known or reasonably discoverable by Plaintiff before purchase, and failed to disclose the defect to Plaintiff before purchase or at any point during ownership. (Id., ¶¶ 62, 68-69.)

The Complaint further alleges intentional concealment. Plaintiff alleges Manufacturer and its agents actively concealed the Engine Defect and failed to disclose it to Plaintiff at the time of purchase or thereafter. (Complaint, ¶ 57.) Plaintiff also alleges Manufacturer knew about and concealed the Engine Defect and its attendant safety and drivability problems from Plaintiff at the time of sale, repair, and thereafter, and that Manufacturer either refused to acknowledge the defect or performed superficial and ineffectual repairs that merely masked its symptoms. (Id., ¶ 59.)

Plaintiff further alleges Manufacturer continued to represent that vehicles equipped with the 3.0L engine were high quality, trained dealers to tout the engine’s supposedly superior attributes, concealed the defect in marketing materials relied upon by Plaintiff, and authorized limited repair measures that did not resolve the underlying defect. (Id., ¶¶ 72, 75-78.)

The Complaint also pleads reliance, materiality, and damages. Plaintiff alleges the Engine Defect was a material fact that a reasonable consumer would consider when deciding whether to purchase or lease a vehicle equipped with a 3.0L engine, and that Plaintiff would not have purchased the Subject Vehicle had the defect been disclosed. (Complaint, ¶¶ 60, 66.) Plaintiff alleges he relied on Manufacturer’s and its agents’ omissions and concealment, and suffered an ascertainable loss of money, property, and value to the Subject Vehicle. (Id., ¶ 61.)

Plaintiff’s allegations are similar to those found sufficient in Dhital, where the plaintiffs alleged Nissan manufactured and distributed vehicles with a defective CVT transmission that posed a safety hazard, Nissan had exclusive knowledge of the defect, Nissan intentionally concealed and failed to disclose that information, the plaintiffs would not have purchased the vehicle had they known of the defect, and the plaintiffs suffered damages. (Dhital, supra, 84 Cal.App.5th at pp. 843- 844.) The Dhital court held those allegations sufficient at the pleading stage and declined to require more detailed allegations about the alleged transmission defect. (Id. at p. 844.)

Likewise, accepting the Complaint’s allegations as true and applying the relaxed specificity standard applicable where the relevant facts are largely within Manufacturer’s knowledge, Plaintiff has adequately pleaded the nature of the alleged defect, Manufacturer’s alleged pre-sale knowledge, concealment, materiality, reliance, and resulting damages.

Thus, the demurrer on this ground is overruled.

b. Negligent Repair

Defendants argue the negligent repair claim fails because it is barred by the economic loss rule and because the Complaint fails to allege sufficient facts demonstrating damages.

The elements of a cause of action for negligence are (1) the existence of a duty, (2) breach, (3) causation, and (4) damages. (Pellegrini v. Weiss (2008) 165 Cal.App.4th 515, 524.) For most claims, including claims for negligence, one need plead only ultimate facts, not evidentiary facts. (See Ludgate Ins. Co. v. Lockheed Martin Corp. (2000) 82 Cal.App.4th 592, 606 [“A cardinal rule of pleading is that only the ultimate facts need be alleged.”].)

Plaintiff has sufficiently alleged the scope of Repair Facility’s duty and breach. The Complaint alleges Plaintiff delivered the Subject Vehicle to Repair Facility for substantial repair on at least one occasion, that Repair Facility owed Plaintiff a duty to use ordinary care and skill in the storage, preparation, and repair of the Subject Vehicle in accordance with industry standards, that it breached that duty by failing to properly store, prepare, and repair the Subject Vehicle, and that its negligent breach was a proximate cause of Plaintiff’s damages. (Complaint, ¶¶ 47-50.) These allegations sufficiently plead the ultimate facts for duty, breach, causation, and damages. Defendants can obtain any additional details through discovery. (See Lickiss v. Financial Industry Regulatory Authority (2012) 208 Cal.App.4th 1125, 1135.)

Plaintiff’s cause of action for negligent repair is based on Repair Facility’s alleged negligent failure to perform services and not the sale or furnishing of defective products. The economic loss rule applies to claims involving the furnishing of goods, not the negligent performance of services as alleged here. (See North American Chemical Co. v. Superior Court (1997) 59 Cal.App.4th 764, 780-781.)

In Sheen, the court held that tort claims for monetary losses between contractual parties are barred by the economic loss rule when they arise from or are not independent of the parties’ underlying contracts. (Sheen v. Wells Fargo Bank, N.A. (2022) 12 Cal.5th 905, 922, 923-925). However, the Sheen Court acknowledged the “recognized exception to the economic loss rule for consumers who contract for certain kinds of professional services.” (Id. at 933.)

Under the factors considered in North American Chemical, the Court does not find, at the pleading stage, that the economic loss rule bars Plaintiff’s negligent repair cause of action on the face of the Complaint.

Thus, the demurrer on these grounds is overruled.

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Defendants also move to strike Plaintiff’s punitive damages request.

The motion is denied because Plaintiff has asserted a viable cause of action for fraudulent concealment, and punitive damages are available where a defendant is guilty of fraud. (Civ. Code, § 3294, subd. (a); see Dhital v. Nissan North America, Inc., supra, 84 Cal.App.5th at p. 845 [reversing trial court’s order granting motion to strike punitive damages allegations where the plaintiff stated a viable fraud claim]; Nissan Motor Acceptance Cases (2021) 63 Cal.App.5th 793, 829 [fraudulent concealment is an intentional tort that may support a punitive damages award].)

While Defendants argue the Complaint fails to identify an officer, director, or managing agent who engaged in, authorized, or ratified the alleged misconduct, the Complaint alleges Manufacturer knew of the Engine Defect, its safety risks, and its inability to repair the defect, yet failed to disclose the defect and continued to authorize limited repair measures. (Complaint, ¶¶ 57, 62-65, 72-78.) At the pleading stage, these allegations are sufficient to support the punitive damages request based on fraud.

Defendants shall file their Answer to the Complaint within five days of notice of this order.

Plaintiff to give notice.

54 Hernandez vs. Kopecky

25-01482111 Motion to Strike Portions Of Complaint

Motion to Strike is MOOT. Case Management Conference remains on Calendar.

55 Newnes vs. Lay

25-01525344 1. Demurrer to Amended Complaint 2. Motion to Strike Portions Of Complaint

Defendant Christopher Carr Lay demurs to the first, second, third, fourth, sixth, and seventh causes of action in the First Amended Complaint (“FAC”) filed by Plaintiff Curt Newnes. Defendants Josh Chandler and Justice Solutions Group, LLC (JSG”) demur to the FAC’s fifth cause of action. The demurrer is SUSTAINED as to the first cause of action for identity theft; third cause of action for defamation; fourth cause of action for unfair competition; and fifth cause of action for constructive fraud. The demurrer is OVERRULED as to the second cause of action for invasion of privacy; sixth cause of action for negligence (per se); and seventh cause of action for violation of Penal Code section 496.