Finger vs. FCA US, LLC

Third Cause of Action for Violation Civil Code section 1793.2(a)(3) Civil Code section 1793.2(a)(3) provides, “Every manufacturer of consumer goods sold in this state and for which the manufacturer has made an express warranty shall: . . . . (3) Make

available to authorized service and repair facilities sufficient service literature and replacement parts to effect repairs during the express warranty period.”

Here, the Complaint alleges, in relevant part:

52. In violation of Civil Code section 1793.2, subdivision (a)(3), Defendant FCA failed to make available to its authorized service and repair facilities sufficient service literature and replacement parts to effect repairs during the express warranty period. Plaintiff has been damaged by Defendant FCA's failure to comply with its obligations pursuant to Civil Code section 1793.2(a)(3), and therefore brings this Cause of Action pursuant to Civil Code section 1794.

53. Defendant FCA's failure to comply with its obligations under Civil Code section 1793.2, subdivision (a)(3) was willful, in that Defendant FCA knew of its obligation to provide literature and replacement parts sufficient to allow its repair facilities to effect repairs during the warranty period, yet Defendant FCA failed to take any action to correct its failure to comply with the law. Accordingly, Plaintiff is entitled to a civil penalty of two times Plaintiff's actual damages, pursuant to Civil Code section 1794(c).

The foregoing allegations as to the Third Cause of Action are sufficient to constitute a cause of action. Despite Defendant’s contention that there is no indication of which parts or literature were not made available to any repair facilities at any time, Defendant provides no legal authority requiring that Plaintiff identify the alleged literature or replacement parts that were not made available.

Defendant also contends that the damages pled are duplicative of damages for the other three causes of action for violations of the Song-Beverly Consumer Warranty Act, and therefore the cause of action should be stricken. However, this cause of action is not duplicative of the other causes of action, as it relies on a distinct theory of recovery (i.e., the failure to make sufficient literature and replacement parts available). (See, e.g., Palm Springs Villas II Homeowners Ass'n, Inc. v Parth (2016) 248 Cal.App.4th 268, 290 (cause of action only duplicative where it adds nothing to the complaint by way of fact or theory of recovery).)

Accordingly, the demurrer to the third cause of action is OVERRULED.

Sixth Cause of Action for Fraudulent Inducement – Concealment Defendant demurs to the Sixth Cause of Action, asserting the same is barred by the three-year statute of limitations articulated within Code of Civil Procedure section 338, subdivision (d). This provision expressly applies to fraud and states: “The cause of action in that case is not deemed to have accrued until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.” (Code Civ. Proc., § 338, subd. (d).)

Defendant contends that the statute of limitations ran from the date of purchase –January 3, 2022, and expired three years later, on January 3, 2025. (See Code Civ. Proc., § 338, subd. (d).) Plaintiff initiated the instant action until March 25, 2025.

However, the Complaint alleges that “the defect was not known to or reasonably discoverable by Plaintiff before they purchased or leased the Subject Vehicle” and that “Plaintiff discovered Defendants' wrongful conduct alleged herein shortly before the filing of the complaint, as the

Vehicle continued to exhibit symptoms of defects following FCA's unsuccessful attempts to repair them.” (Compl. ¶¶ 22, 38.)

“The provision tolling operation of the statute until discovery of the fraud has long been treated as an exception and, accordingly, this court has held that if an action is brought more than three years after commission of the fraud, plaintiff has the burden of pleading and proving that he did not make the discovery until within three years prior to the filing of his complaint.” (Hayward Union High School Dist. of Alameda County v. Madrid (1965) 234 Cal.App.2d 100, 126.)

More specifically, “[i]n order to rely on the discovery rule for delayed accrual of a cause of action, ‘[a] plaintiff whose complaint shows on its face that his [or her] claim would be barred without the benefit of the discovery rule must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence.’ ” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 808.) “In assessing the sufficiency of the allegations of delayed discovery, the court places the burden on the plaintiff to ‘show diligence’; ‘conclusory allegations will not withstand demurrer.’ ” (Ibid.)

Here, Plaintiff only alleges that the limitations periods was tolled because he “discovered Defendants' wrongful conduct alleged herein shortly before the filing of the complaint, as the Vehicle continued to exhibit symptoms of defects following FCA's unsuccessful attempts to repair them.” (Compl. ¶ 38.) He provides no further factual allegations regarding the time and manner of his discovery of the alleged breaches or fraud or his inability to have discovered them earlier despite reasonable diligence. His allegations of tolling are conclusory and wholly insufficient to invoke the delayed discovery rule or any other equitable tolling.

Accordingly, the demurrer to the sixth cause of action is SUSTAINED with 20 days leave to amend.

*** In light of this ruling, the Court need not address Defendant’s remaining challenges to the fraud cause of action. Nonetheless, the Court provides the following analysis regarding why the Demurrer would have been overruled as to the following challenged grounds.

“[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.)

“California courts apply the same specificity standard to evaluate the factual underpinnings of a fraudulent concealment claim at the pleading stage” however “the focus of the inquiry shifts to the unique elements of the claim.” (Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, 43.) Where a duty to disclose arises “by virtue of the parties’ relationship and defendant’s exclusive knowledge or access to certain facts,” the Complaint must “include specific allegations establishing all the required elements, including (1) the content of the omitted facts, (2) defendant’s awareness of the materiality of those facts, (3) the inaccessibility of the facts to plaintiff, (4) the general point at which the omitted facts should or could have been revealed, and

(5) justifiable and actual reliance, either through action or forbearance, based on the defendant’s omission.” (Id. at pp. 43-44.)

Defendant contends that Plaintiff failed to allege what specific problems Plaintiff experienced, approximately when he brought it in for service, or justifiable reliance on communications about the engine.

However, as noted by the Court in Alfaro v. Community Housing Improvement System & Planning Assn., Inc. (2009) 171 Cal.App.4th 1356, “[e]ven under the strict rules of common law pleading, one of the canons was that less particularity is required when the facts lie more in the knowledge of the opposite party...” (Ibid.)

Here, Plaintiff alleged he entered into a warranty relationship with FCA around January 3, 2022 (Complaint, ¶ 7); Plaintiff identified the material facts FCA knew prior to his acquisition of the Subject Vehicle that FCA withheld from Plaintiff (Id., ¶¶ 16, 18-20, 22-23, 25-26, 66-67); Plaintiff alleged that Defendant had superior knowledge of the facts (Id., ¶¶ 22, 67); the safety risks posed by the Engine Defect (Id., ¶¶ 13, 16-17, 20, 23-24, 65, 67, 70); the materiality of that information (Id., ¶¶ 68-69); Plaintiff’s reliance on the non-disclosure (Id., ¶¶ 24, 69 71); and damages.

Defendant next contends that Plaintiff fails to plead breach of an independent tort outside the warranty contract claim. The California Supreme Court has specifically indicated that tort damages are permitted in contract cases “where the contract was fraudulently induced.” (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 989-990.) “[I]n each of these cases, the duty that gives rise to tort liability is either completely independent of the contract or arises from conduct which is both intentional and intended to harm.” (Id. at p. 990.)

Additionally, “California case law similarly has viewed fraud by concealment on equal footing with fraud by affirmative misrepresentation.” (Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, 39.) “Where failure to disclose a material fact is calculated to induce a false belief, the distinction between concealment and affirmative misrepresentation is tenuous.” (Ibid.)

In demurring to this claim, Defendant relies heavily on Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, however, the California Supreme Court in Rattagan held the same exception to the economic loss doctrine discussed in Robinson applies to concealment claims, “if the elements of the claim can be established independently of the parties’ contractual rights and obligations and the tortious conduct exposes the plaintiff to a risk of harm beyond the reasonable contemplation of the parties when they entered into the contract.” (Id. at p. 45.)

Of note, in stating application of the economic loss doctrine would “turn on the nature of the alleged conduct, the provisions of the contract itself, and whether the conduct exposed a party to a risk of harm neither reasonably contemplated nor allocated by the parties before entering their agreement,” the Court in Rattagan expressly addressed the application of the doctrine to a claim of “fraudulent concealment based on conduct occurring in the course of a contractual relationship....” (Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, 44.) The Court explicitly distinguished such a claim from “fraudulent inducement of contract.” (Id. at p. 41.)

Relevant herein, the Court in Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828, specifically found a similar claim for fraudulent inducement was not defeated by the economic loss rule. (Id. at p. 838-839, 843 [“Fraudulent inducement claims fall within an exception to the economic loss rule recognized by our Supreme Court....”)

Defendant next asserts there was no privity of relationship, such as to establish a duty to disclose. The Court in Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828 rejected a similar argument, finding allegations Plaintiff “bought the car from a Nissan dealership, that Nissan backed the car with an express warranty, and that Nissan’s authorized dealerships are its agents for purposes of the sale of Nissan vehicles to consumers,” sufficient. (Id. at p. 844.) The instant Complaint, similarly, alleges Plaintiff “interacted with FCA’s sales representatives” prior to purchasing the Subject Vehicle and that he entered into a warranty contract with Defendant FCA. (Complaint, ¶¶ 7-8, 70.)

As was the case in Dhital and as was recently stated in Gilead Tenofovir Cases, “a vehicle manufacturer owes a duty to purchasers of its vehicles to disclose known defects.” (Gilead Tenofovir Cases (2024) 98 Cal.App.5th 911, 949, as modified on denial of reh'g (Feb. 1, 2024), rev'd and remanded on other grounds (Cal., Aug. 3, 2026, No. S283862) 2026 WL 2223748.)

Defendant finally contends that Plaintiff fails to allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written. This pleading standard identified by Defendant applies to fraudulent misrepresentations and not concealment. As the Court in Alfaro v. Community Housing Improvement System & Planning Assn., Inc. queried, “[h]ow does one show ‘how’ and ‘by what means’ something didn’t happen, or ‘when’ it never happened, or ‘where’ it never happened?” (Id. at p. 1384.)

Moreover, the name of the person who made the alleged omission was not identified as a required allegation, necessary to support fraudulent concealment, by the California Supreme Court in Rattagan. (Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, 43-44.) Additionally, assuming this information was generally required, “[e]ven under the strict rules of common law pleading, one of the canons was that less particularity is required when the facts lie more in the knowledge of the opposite party...” (Alfaro v. Community Housing Improvement System & Planning Assn., Inc. (2009) 171 Cal.App.4th 1356, 1384.) To any extent one individual employed by Defendant was tasked with making required disclosures, Defendant is necessarily in possession of that information.

Motion to Strike

Defendant’s motion to strike portions of complaint is GRANTED, with 20 days leave to amend.

The only remaining claims in the complaint against this defendant are for violations of the Song- Beverly Act, under which Plaintiff seeks civil penalties. By seeking civil penalties under that Act, Plaintiff has “in effect elected to waive punitive damages.” (Troensegaard v. Silvercrest Industries, Inc. (1985) 175 Cal.App.3d 218, 228.) Thus, without a fraud claim to support the prayer for punitive damages, the request for punitive damages fails. Leave to amend has been granted as to this fraud cause of action, as set forth above.

Defendant to give notice.