Demurrer

Cal. Super. - 6th Dist.June 21, 2021

J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 21 CV384558 Santa Clara - Civil Mary Arens McBride, Esq. (SBN: 282459) Jed VonDielingen, Esq. (SBN: 342710) ERSKINE LAW GROUP, PC 1576 N. Batavia St., Suite A Orange, CA 92867 Tel: (949) 777-6032 Fax: (714) 844-9035 Email: marensmcbride@erskinelaw.com Email: jvondielingen@erskinelaw.com Attorneys for Defendant, GENERAL MOTORS LLC P. Hernar Electronically Filed by Superior Court of CA, County of Santa Clara, on 2/1 7/2022 11:49 AM Reviewed By: P. Hernandez Case #21 CV384558 Envelope: 8315175 SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SANTA CLARA - DOWNTOWN SUPERIOR COURT CARMEN CAMACHO, an individual, Plaintiff, V. GENERAL MOTORS LLC, a Delaware Limited Liability Company; and DOES 1 through 20, inclusive, Defendants CASE NO.: 21CV384558 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES [Filed concurrently with Declaration 0f Jed VonDielingen; [Proposed] Order; and Motion t0 Strike Punitive Damages] DATE: TIME: DEPT: 7 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST Page 1 0f 16 AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES dez 9:00am June 07, 2022 J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TO THE HONORABLE COURT, ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that 0n June 07 , 2022 at 9:00 a.m./p. 0r as soon thereafter as the matter may be heard in Department 7 0f the above-captioned Court located at 191 N. First Street, San Jose, CA 95 1 13, General Motors LLC (“GM”) will and hereby does move this Court for an order sustaining GM’s Demurrer t0 Plaintiff Carmen Camacho’s (“Plaintiff”) First Amended Complaint. DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT GM hereby demurs t0 Plaintiffs Causes 0f Action within Plaintiffs First Amended Complaint as filed herein, 0n the following grounds: 1. The third cause 0f action for Fraudulent Inducement-Concealment is barred by the Economic Loss Rule and thus fails t0 state facts sufficient t0 constitute a cause 0f action. (Code CiV. Proc., § 430.10(e)). 2. The third cause 0f action for Fraudulent Inducement-Concealment fails t0 state facts sufficient t0 establish the fraud cause 0f action. (Id) This Demurrer is brought pursuant t0 California Code 0f Civil Procedure Section 430. 10, and is based 0n this Notice 0f Demurrer and the attached Demurrer, Memorandum 0f Points and Authorities, the Declaration 0f Jed VonDielingen, the papers, pleadings and records 0n file in this action and such other papers, pleadings, and arguments as this Court shall admit at the time 0f the hearing. Dated: February 17, 2022 ERSKINE LAW GROUP, PC MARY ARENS MCBRIDE, Esq. JED VONDIELINGEN, Esq. Attorneys for Defendant, GENERAL MOTORS LLC Page 2 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF CONTENTS I. INTRODUCTION ............................................................................................................... 6 II. SUMMARY OF ALLEGATIONS AND PROCEDURAL HISTORY .............................. 6 III. MEET AND CONFER PER CODE 0F CIVIL PROCEDURE SECTION 430.41 ............ 7 IV. LEGAL STANDARD .......................................................................................................... 7 V. ARGUMENT ....................................................................................................................... 8 A. The Economic Loss Rule Bars the Fraud Cause 0f Action. .................................... 8 B. Plaintiff” s Fraudulent Inducement-Concealment Claim Fails Because the FAC Fails t0 Plead Fraud with the Required Specificity. .............................................. 12 C. Plaintiff” s Fraudulent Inducement-Concealment Claim Fails Because Plaintiff Does Not Allege a Transactional Relationship Between GM and Plaintiff Giving Rise t0 a Duty t0 Disclose ...................................................................................... 13 VI. CONCLUSION .................................................................................................................. 15 Page 3 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Cases Aas v. Superior Court (2000) 24 Cal 4th 627, 643 ......................................................................... 8 Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276 ........................................................... 13, 14 Blank v. Kirwan (1985) 39 Cal.3d 311 ........................................................................................... 7 Donabedian v. Mercury Ins. C0. (2004) 116 Cal.App.4th 968 ...................................................... 7 Finney v. Ford Motor C0., 2019 WL 79033 at *5 (N.D. Cal. 2019) ............................................ 10 Hammond v. BMW 0fN0rth America, N0. CV 18-226 DSF (MRWX), 2019 WL 2912232 9, 10 Hien Bui v. MercedeS-Benz USA, LLC, N0. 20-CV-1530-CAB-WVG, 2021 WL 242936 (SD. Cal. Jan. 25,2021) ...................................................................................................................... 11, 12 Hoffman v. I 62 North Wolfe LLC (2014) 228 Cal.App.4th 1178 ................................................. 14 Hsieh v. FCA US LLC, 440 F. Supp. 3d 1157 (SD. Cal. 2020) ................................................... 11 In re FordMotor C0. DPS6 Powershift Transmission Prod. Liab. Lit., N0. CV1706656ABFFMX, 2019 WL 3000646 (C.D. Cal. May 22, 2019) .......................................................................... 11 Kamen v. Lindley (2001) 94 Cal.App.4th 197 ................................................................................ 7 Kelsey v. Nissan N. Am., N0. CV 20-4835 MRW, 2020 WL 4592744 (CD. Cal. July 15, 2020)10 La Vista Cemetery ASSOC. v. Am. Savings & Loan ASSOC. (1970) 12 Cal.App.3d 365 ................... 8 Lazar v. Superior Court (1996) 12 Cal.4th 631 ............................................................................ 12 Leon v. Kia Motors America, Inc. (Orange Cnty Cal. Super. 30-2019-01093543-CU-BC-CJC) (Order 12/13/2019) ................................................................................................................... 11 LiMandri v. Judkins (1997) 52 Cal.App.4th 326 .................................................................... 13, 14 Macias v. Chrysler, N0. CV 17-1823, 2020 WL 4723976 ........................................................... 11 Moore v. Regents 0fUniv. 0fCal. (1990) 51 Cal.3d 120 ............................................................... 7 Mosqueda v. American Honda Motor C0., -F. Supp. 3d -, N0. SA CV 19-839 MWF (MAAX), 2020 WL 1698710 (C.D. Cal. 2020) ......................................................................... 10 Nada Pac. Corp. v. Power Eng’g and Mfg, Ltd, 73 F. Supp. 3d 1206 (ND. Cal. 2014) .............. 8 Page 4 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Penrose v. Winter (1901) 135 Cal. 289 ........................................................................................... 7 Robinson Helicopter C0., Inc. v. Dana Corp. (2004) 34 Cal. 4th 979 ........................................... 8 Sloan v. Gen. Motors LLC, N0. 16-CV-07244-EMC, 2020 WL 1955643 (ND. Cal. Apr. 23, 2020) ............................................................................................................................................... 8, 10 Stewart v. Electrolux Home Prod, Ina, 304 F. Supp. 3d 894 (ED. Cal. 2018) .......................... 10 Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18 ........................................................................... 13 Thompson v. BMW 0fN0rth America, N0. SA CV 17-1912 CJC (KSX), 2019 WL 988694 (CD. Cal. 2019) .............................................................................................................................. 9, 10 Traba v. Ford Motor C0., N0. CV 18-808 SVW (GJSX), 2018 WL 6038302 (CD. Cal. 2018). 10 Warner Construction Corp. v. City ofLOS Angeles (1970) 2 Cal.3d 285 ..................................... 14 Yi v. BMW 0fN0rth America LLC, N0. 2: 17-CV-06467-SVW-SK (C.D. Cal. Mar. 5, 2018) ......... 9 Zagarian v. BMW 0fN.Am., N0. CV 18-4857 RSWL (PLAX), 2019 WL 61 1 1731 ................ 9, 10 Statutes Code 0sz'v. Proa, § 430.10(e) ...................................................................................................... 7 Page 5 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION Plaintiff Carmen Camacho (“Plaintiff”) wrongly attempts t0 turn this simple lemon law action into a complicated extra-contractual fraudulent concealment case against Defendant General Motors LLC (“GM”). As explained below, however, Plaintiffs “fraud” claim fails as a matter 0f law under the Economic Loss Rule and because-among other deficiencies-Plaintiff never alleged he purchased the vehicle directly from GM 0r that he Viewed (much less relied 0n) any representations made by GM in deciding t0 purchase his vehicle. In short, there is zero factual 0r legal basis for Plaintiffs “fraud” claim. GM’s demurrer should be sustained without leave t0 amend. II. SUMMARY OF ALLEGATIONS AND PROCEDURAL HISTORY On October 29, 2019, Plaintiff purchased, a 2019 GMC Sierra 1500, VIN 3GTU9BED3KG222349 (the “Subj ect Vehicle” 0r “Sierra”). (See First Amended Complaint (“FAC”), 11 5.) On June 24, 2021, Plaintiff filed breach 0f warranty and fraud claims based upon allegations that the Subject Vehicle developed various alleged “defects” during the warranty period. (See Complaint.) On January 19, 2022, Plaintiff filed a First Amended Complaint (“FAC”) asserting additional allegations 0f fraudulent inducement-concealment, but it again fails t0 provide the critical facts that would support his claims. (See FAC, generally.) Plaintiff” s Fraudulent Inducement-Concealment cause 0f action is based almost entirely 0n Plaintiff” s generic allegations that GM failed t0 disclose that the Sierra’s 8L90 automatic transmission was allegedly defective. (See FAC, 1W 15-1 8, 70-73, 108-1 10.) According t0 Plaintiff, GM supposedly acquired knowledge about the specific performance 0f the Subj ect Vehicle from aggregated data in multiple unidentified sources about vehicles other than the Subject Vehicle-namely, other customers’ vehicles and 16 other model GM vehicles (id. at 1W 19, 30)-then knowingly and intentionally concealed material facts from Plaintiff. (See generally id.) However, Plaintiff fails t0 allege (i) the identity 0f the person who sold him the Sierra, (ii) whether or not Plaintiff had any interaction with GM at 0r before he bought the Sierra, (iii) GM’s Page 6 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 knowledge 0f the alleged defects in Plaintiffs Sierra, and (iv) GM’s intent t0 defraud Plaintiff. Instead, Plaintiff asserts his claims in wholly conclusory fashion. Essentially, Plaintiff alleges only that his vehicle is a type 0f vehicle that may suffer from a type 0f defect and that during the unspecified warranty period, the vehicle contained various alleged defects, which Plaintiff describes only in general terms. (See generally FAC.) As explained below, such allegations are insufficient. GM’s demurrer should be sustained. III. MEET AND CONFER PER CODE 0F CIVIL PROCEDURE SECTION 430.41 GM made a good faith effort t0 meet and confer telephonically t0 resolve the issues outlined in this demurrer without the need for court intervention but was unsuccessful despite its best efforts. (Declaration 0f Jed VonDielingen, 11 2.) IV. LEGAL STANDARD A demurrer challenges defects apparent 0n the face 0fthe complaint 0rjudicially noticeable matters outside the pleadings. (Blank v. Kirwan (1985) 39 Cal.3d 31 1, 318; Donabedian v. Mercury Ins. C0. (2004) 116 Cal.App.4th 968, 994.) In ruling 0n a demurrer, “the trial court . . . treats the demurrer as admitting all material facts properly pleaded, but not contentions, deductions 0r conclusions 0f fact 0r law.” (Kamen v. Lindley (200 1) 94 Cal.App.4th 197, 20 1; see also Moore v. Regents 0fUm'v. ofCal. (1990) 51 Cal.3d 120, 125.) A pleading that “does not state facts sufficient t0 constitute a cause 0f action” is subj ect t0 demurrer.” (Code osz'v. Proa, § 430. 10(6)). A pleading fails t0 state a cause 0f action if it pleads essential allegations as legal conclusions rather than as facts. (Penrose v. Winter (1901) 135 Cal. 289, 290-291.) Further, a pleading that is uncertain, ambiguous and/or unintelligible is subject t0 demurrer. (Code 0f Civ. Proa, § 430.10 (D). The Court must determine if the flaws inherent in the pleading can be remedied by the amendment; if the plaintiff cannot correct the deficiencies, leave t0 amend should be denied. (La Vista Cemetery ASSOC. v. Am. Savings & Loan ASSOC. (1970) 12 Cal.App.3d 365, 369.) Against this standard, Plaintiffs “fraud” claim is barred by significant factual deficiencies and a number 0f legal doctrines such that this Court should sustain GM’s demurrer without leave Page 7 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 t0 amend. V- w A. The Economic Loss Rule Bars the Fraud Cause 0f Action. A person “may not ordinarily recover in tort for the breach 0f duties that merely restate contractual obligations.” (Aas v. Superior Court (2000) 24 Cal.4th 627, 643, superseded by statute 0n other grounds.) The purchaser must “demonstrate harm above and beyond a broken contractual promise.” (Robinson Helicopter C0., Inc. v. Dana Corp. (2004) 34 Ca1.4th 979, 988 (noting “the economic loss rule prevents the law 0f contract and the law 0f tort from dissolving one into the other”) (internal citation and quotation marks 0mitted).) California courts have consistently held that the economic loss doctrine bars fraudulent omissions claims based 0n purely economic loss. (See Sloan v. Gen. Motors LLC (ND. Cal. Apr. 23, 2020) N0. 16-CV-07244-EMC, 2020 WL 1955643, at *23-24 (surveying decisions).) Plaintiff did not allege in his FAC that GM is liable for anything other than economic loss. Despite Robinson’s holding that “the economic loss rule does not bar [a plaintiff” s] fraud and intentional misrepresentation claims [where they are] independent 0f breach 0f contract,” it expressly stated that its holding was “narrow in scope and limited t0 a defendant’s affirmative misrepresentations 0n which a plaintiff relies and which expose a plaintiff to liability for personal damages independent 0f the plaintiff‘s economic loss.” (34 Cal.4th at 991, 993. See also Nada Pac. Corp. v. Power Eng’g and Mfg, Ltd. (N.DCal. 2014) 73 F.Supp.3d 1206, 1225 (“[Plaintiff] does not allege that [the defendant] made any affirmative misrepresentations 0n which it relied, nor does it allege that it was exposed t0 liability for personal damages independent 0f its economic loss. Without having done so, [Plaintiff] cannot fit within Robinson’s narrow and limited holding.”).) The affirmative misrepresentation that exposed the Robinson plaintiff t0 liability for personal damages, independent 0f that plaintiffs economic loss, is regularly referred t0 as the “Robinson exception.” Multiple courts, in opinions that post-date Robinson, have confirmed that the Robinson exception only applies when the defendant has made an affirmative misrepresentation and the Page 8 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 plaintiff has sustained damages independent 0f the alleged economic loss. The following courts all concluded that the Robinson exception does not extend t0 fraud claims based upon alleged concealment, omissions, 0r non-disclosures: In Zagarian, the plaintiff asserted fraud based upon allegations that BMW omitted information about an “oil consumption” defect in the subject vehicle. (Zagarian v. BMWofN. Am., LLC (C.D.Cal. Oct. 23, 2019) N0. CV 18-4857 RSWL (PLAX), 2019 WL 61 1 1731, at *2). The court there recognized that some courts have applied the economic loss rule t0 claims 0f fraudulent concealment, finding that its application is only barred where a party has made affirmative representations that are fraudulent. (Id. at *3) Because the Zagarian plaintiff (i) had not alleged a single affirmative misrepresentation 0n the part 0fBMW and (ii) had not shown any exposure t0 personal damages independent 0f his economic loss, the court dismissed the plaintiffs fraud claim as barred by the economic loss rule. (Id.) In Hammond, the plaintiff only sought damages associated with defects in the subject vehicle, yet still asserted fraud claims (i) without alleging that BMW made any affirmative misrepresentations and (ii) without claiming damages beyond his economic loss associated with the vehicle itself. (Hammond v. BMW ofN. Am., LLC (C.D.Cal. Jun. 26, 2019) N0. CV 18-226 DSF (MRWX), 2019 WL 2912232, at *2). When the plaintiff argued that his fraud claim fell under the Robinson exception, the court rejected that argument, opining that the Robinson exception applied only t0 affirmative misrepresentations. (Id) Because the plaintiff had not alleged any affirmative misrepresentations by BMW and did not seek damages other than his economic loss, the Hammond court ruled that the fraud claim based 0n “omissions” and “concealment” was barred by the economic loss rule. (Id. at *3.) In Thompson, the plaintiff asserted a fraud claim based upon an allegation that BMW omitted information about ”defect” causing the vehicle t0 consume abnormally high amounts 0f oil. (Thompson v. BMW ofN. Am., LLC (C.D.Cal. Jan. 10, 2019) N0. SA CV 17-1912 CJC (KSX), 2019 WL 988694, at *4). The court there held that, because plaintiff (i) had alleged fraud due t0 an alleged omission, (ii) had not alleged any personal injury 0r damages other than economic loss, and (iii) had not alleged a “single affirmative misrepresentation” by BMW, the fraud claim was barred by the economic loss rule. (Id. at *5.) In Yi, the plaintiff asserted a fraud claim based upon allegations thatBMW had omitted information about the subject vehicle burning through oil at an excessive rate. (Yz' v. BMW ofN. Am. LLC (C.D.Cal. Mar. 5, 2018) N0. 2:17-CV-06467-SVW-SK, 2018 WL 11148443, at *1 ). The Yz' court ruled that, t0 avoid preclusion 0f a fraud claim under the economic loss rule, a plaintiff must show exposure t0 personal damages independent 0f the economic loss. (Id. at *2 (citing Robinson, 34 Ca1.4th at 993)). A plaintiff cannot satisfy this condition (i.e., personal damages independent 0f the economic loss) merely by arguing that the alleged “fraud” would open the door t0 greater damages for the plaintiff. (Id.) The Yz' court noted that, if a court were t0 interpret the Robinson exception that broadly, it would “eviscerate the guidelines set out by the Robinson court.” (Id.) Because the Yz' plaintiffs complaint did not claim additional, non-economic damages other than the alleged damages arising from the alleged defect (i.e., damages “above and beyond a broken contractual promise”), the “fraud” claim failed as a matter 0f law. (Id) Page 9 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 These four cases are not outliers. Last summer, in Kelsey v. Nissan North America (C.D.Cal. Jul. 15, 2020) N0. CV 20-4835 MRW, 2020 WL 4592744, at *1-2, the court dismissed the plaintiffs fraud claim because the plaintiff did not claim any affirmative misrepresentations by Nissan 0r economic damages other than economic loss due t0 alleged vehicle defects. The court noted that “[n]umer0us California federal courts sitting in diversity have applied the economic loss rule t0 prohibit a follow-on fraudulent inducement claim in run-of-the-mill Song- Beverly Act warranty breach actions.” (Id. at *2.) The court then provided a “monstrously-long” string cite t0 support its conclusion: Mosqueda v. American Honda Motor C0., -F. Supp. 3d-, N0. SA CV 19-839 MWF (MAAX), 2020 WL 1698710 at *13 (C.D. Cal. 2020) (“Because Plaintiffs concede that they seek only economic damages and premise their fraud claim 0n alleged omissions [,] Plaintiffs’ fraudulent omission claim is barred by the economic loss rule”); Hammond v. BMW ofNorth America, N0. CV 18-226 DSF (MRWX), 2019 WL 2912232 at *2 (C.D. Cal. 2019); Traba v. Ford Motor C0., N0. CV 18-808 SVW (GJSX), 2018 WL 6038302 at *4 (C.D. Cal. 2018) (fraudulent concealment “resulted only in Plaintiffs’ disappointed expectations”; plaintiffs “d0 not claim that the vehicle's alleged defects caused any personal injury 0r damage t0 property other than the vehicle”); Thompson v. BMW ofNorth America, N0. SA CV 17-1912 CJC (KSX), 2019 WL 988694 at *5 (CD. Cal. 2019); Zagarian v. BMW 0fN0rth America, N0. CV 18- 4857 RSWL (PLAX), 2019 WL 6111731 at *3 (CD. Cal. 2019); Sloan v. General Motors, 2020 WL 1955643 at *24 (N.D. Cal. 2020) (“Robinson and the weight 0f authority within the Ninth Circuit suggest that the economic loss rule applies t0 fraudulent omission claims under California law”; “many courts within the Ninth Circuit have relied on Robinson in holding that affirmative representations are required for exceptions t0 the rule t0 apply”); Finney v. Ford Motor C0., 2019 WL 79033 at *5 (ND. Cal. 2019) (under economic loss rule, car purchaser's “remedies are in contract and not in fraud”); Stewart v. Electrolux Home Prod, Ina, 304 F. Supp. 3d 894, 902 (ED. Cal. 2018) (“Plaintiffs’ damages are limited t0 economic loss, precluding their strict liability and fraudulent concealment Claims”); see also, In re Ford Motor C0. DPS6 Powershift Transmission Prod. Liab. Lit., N0. CV1 706656ABFFMX, 2019 WL 3000646, at *6 (C.D. Cal. May 22, 2019) (finding “insufficient support in the California cases [defendant] cites for its distinction between fraudulent inducement by misrepresentation and fraudulent inducement by omission, and therefore declin[ing] t0 apply the economic loss rule t0 the omission claims at [the motion t0 dismiss] stage”). ad.) Page 10 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 In addition t0 Kelsey’s “monstrously-long” list 0f authority, courts have routinely barred omission- and concealment-based fraud claims under the economic loss rule. (See Macias v. Chrysler (C.D.Cal. Aug. 13, 2020) N0. CV 17-1823, 2020 WL 4723976, at *2 (applying economic loss rule t0 preclude fraudulent omission claim); Leon v. Kia Motors Am., Inc. (Orange Cnty Cal. Super. 30-2019-01093543-CU-BC-CJC) (Order 12/13/2019), RJN EX. G (applying economic loss rule t0 preclude fraudulent concealment/omission claim).) Most notably, in a decision issued last year - in a case that mirrors this case - a plaintiff filed a complaint against Mercedes-Benz USA alleging a fraud claim based upon an alleged omission. (Hien Bui v. MercedeS-Benz USA, LLC (S.D.Cal. Jan. 25, 2021) N0. 20-CV-1530-CAB- WVG, 2021 WL 242936, at *4 ). The court there barred plaintiffs claim for fraudulent concealment because the complaint did not allege any personal injury to the plaintiff or any damage t0 physical property independent 0f the subject vehicle. (Id) In fact, the only allegation 0fharm caused by the alleged omission was that “[p]laintiffpurchased the [V]ehicle that he would not have otherwise purchased.” (Id. Compare FAC, 1W 22, 33, 39, 115.) The complaint there did not allege any facts that supported a “plausible inference” that Mercedes had any “general duty t0 ,9 disclose the alleged [] defect regardless 0f whether [p]1aintiff purchased a vehicle, so “any omissions were not independent 0f any warranties related t0 the actual purchase.” (Bui, 2021 WL 242936, at * 4.) Naturally, the court there held that the economic loss rule barred plaintiff‘s fraudulent concealment claim. (Id) But the court did not stop there. It went 0n t0 say that, because plaintiffs alleged “damages were strictly economic” and arose out 0f the “same conduct as the breach 0f warranty claims, n0 amendment t0 the complaint would be able t0 avoid this outcome.” (Id. (citing Hsieh v. FCA US LLC (S.D.Cal. 2020) 440 F.Supp.3d 1157, 1162 (dismissing fraud claim without leave t0 amend because the fact that the lawsuit involved “alleged omissions, not affirmative misrepresentations [precluded] [p]1aintiff”s ability t0 avoid the economic loss rule”).) The Bui court also dismissed plaintiff’s prayer for punitive damages predicated 0n the alleged concealment, because there was n0 argument t0 suggest that his punitive damages claim could survive without his fraudulent concealment claim. (Id) Page 11 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 This case is indistinguishable from all the cases in Kelsey’s “monstrously-long” list and nearly identical t0 the facts presented in Bui. Here, Plaintiff alleges that GM “intentionally concealed the issues created by the Defective Transmission.” (FAC, 11 110.) Plaintiff has not alleged personal injuries 0r damages t0 property other than economic loss for the vehicle itself. (See id.) In fact, the only allegation 0f harm that Plaintiff alleged in the FAC is that, ifGM had disclosed the “defective transmission,” then Plaintiff would not have bought the Subj ect Vehicle. (Id. at 1W 22, 33, 39, 115.) This allegation is exactly what the Bui court rejected. (2021 WL 242936, at *4.) Without an affirmative misrepresentation by GM, and without damages independent 0f the alleged economic loss related t0 his Sierra, Plaintiff” s fraud claim is barred and should be dismissed without leave t0 amend. B. Plaintiff’s Fraudulent Inducement-Concealment Claim Fails Because The FAC Fails t0 Plead Fraud With the Required Specificity. As Plaintiffs Third Cause of Action is premised 0n fraud, “[i]n California, fraud must be pled specifically; general and conclusory allegations d0 not suffice.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.). “This particularity requirement necessitates pleading facts which show how, where, t0 whom, and by what means” the alleged fraud occurred. (Id) Plaintiffs FAC falls far short of meeting this standard. Plaintiff fails t0 identify the salesperson with whom Plaintiff spoke; what advertisements 0r marketing brochures Plaintiff reviewed 0r relied upon in purchasing the Subject Vehicle (see FAC 1W 32-33), how long “prior t0 purchasing the vehicle” he Viewed them, and which representation therein he relied upon; and whether those materials, if any, were prepared by GM 0r someone else (such as a dealership). Plaintiff has also failed t0 plead with specificity, as required, facts supporting any allegation that GM intended t0 defraud him by either making affirmative statements 0r failing t0 disclose material facts. (Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18, 30 [“something more than non- performance is required t0 prove the defendant’s intent not t0 perform his promise”].) Therefore, Plaintiff failed to allege, in detail, facts showing the circumstances 0f discovery and/or what was discovered. Consequently, Plaintiff’s fraudulent concealment cause 0f action fails t0 meet the applicable pleading standard and should be dismissed. Page 12 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 C. Plaintiff’s Fraudulent Inducement-Concealment Claim Fails Because Plaintiff Does Not Allege a Transactional Relationship Between GM and Plaintiff Giving Rise t0 a Duty t0 Disclose. California law does not permit a cause 0f action for concealment that did not arise in a fiduciary relationship 0r in a transaction involving “direct dealings” between the plaintiff and the defendant. Because the FAC does not allege that Plaintiff purchased the Subject Vehicle directly from GM 0r otherwise entered into a transaction with GM, Plaintiff has not alleged facts demonstrating that GM was under a duty t0 disclose, so Plaintiffhas not stated a claim against GM for fraudulent concealment. T0 state a claim for fraudulent inducement-concealment, Plaintiff must allege: (1) the defendant “concealed 0r suppressed a material fact,” (2) the defendant was “under a duty t0 disclose the fact t0 the plaintiff,” (3) the defendant “intentionally concealed 0r suppressed the fact with the intent t0 defraud the plaintiff,” (4) the plaintiff was “unaware 0f the fact and would not have acted as he did if he had known 0f the concealed 0r suppressed fact,” and (5) “as a result 0f the concealment 0r suppression 0f the fact, the plaintiff must have sustained damage.” (Bigler- Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 3 10-1 1; see also Lazar, supra, 12 Cal.4th at 638.) Absent a fiduciary relationship between the parties (which Plaintiff does not-and could not- allege here), a duty t0 disclose can arise in only three circumstances: (1) the defendant had exclusive knowledge 0f the material fact; (2) the defendant actively concealed the material fact; 0r (3) the defendant made partial representations while also suppressing the material fact. (Bigler- Engler, supra, 7 Cal.App.5th at p. 31 1; LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336.) “These three circumstances, however, ‘presuppose[ ] the existence 0f [a] relationship 3”between the plaintiff and defendant in which a duty t0 disclose can arise. (Bigler-Engler, supra, 7 Cal. App.5th at p. 3 11 [quoting Limandri, supra, 52 Cal.App.4th at pp. 336-37; citing examples including “seller and buyer”].) Indeed, the California Supreme Court “has described the necessary relationship giving rise t0 a duty t0 disclose as a ‘transaction’ between the plaintiff and defendant ....” (Bigler-Engler, supra, 7 Cal.App.5th at p. 31 1; Warner Construction Corp. v. City OfLOS Angeles (1 970) 2 Cal.3d 285, 294 [“In transactions which d0 not involve fiduciary 0r confidential Page 13 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES L KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 relations”]; Hofi’man v. I62 North Wolfe LLC (2014) 228 Cal.App.4th 1178, 1187-89 [rejecting concealment claim where plaintiffs “were not involved in a transaction with the parties they claim defrauded them”]; LiMandri, supra, 52 Cal.App.4th at p. 337 [“such a relationship can only come into being as a result 0f some sort 0f transaction between the parties”].) “Such a transaction must necessarily arise from direct dealings between the plaintiff and defendant; it cannot arise between the defendant and thepublic at large.” (Bigler-Engler, supra, 7 Cal.App.5th at p. 311, emphases added.) In Bigler-Engler, for example, the Court 0f Appeal reversed a verdict for fraudulent concealment against the manufacturer 0f a medical device because the manufacturer and the plaintiff (who was injured by using the device) did not have the required direct transactional relationship. (Id. at pp. 314-15.) The plaintiff did not obtain the device directly from the manufacturer but from a medical group that sold and leased such devices. (Id. at 287, 3 14.) As the Court oprpeal explained, the lack 0f direct dealings between the plaintiff and the manufacturer was fatal t0 the plaintiffs argument that the manufacturer had a duty t0 disclose. (Id. at 312 [“Where, as here, a sufficient relationship 0r transaction does not exist, n0 duty t0 disclose arises even when the defendant speaks.”].) The same is true here. The FAC does not allege that Plaintiffpurchased the Subj ect Vehicle directly from GM. Thus, any alleged concealment by GM did not arise in a direct transaction between Plaintiff and GM. Accordingly, under California law, there could not have been any actionable concealment by GM that allegedly induced Plaintiff’s purchase 0f the vehicle. Thus, as a matter 0f law, Plaintiff cannot establish thatGM had a duty t0 disclose. GM’s demurrer should be sustained. / / / / / / / / / / / / / / / / / / Page 14 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 VI. CONCLUSION For the reasons explained above, Plaintiffs third cause 0f action for Fraudulent Inducement-Concealment is precluded by the economic loss rule. Additionally, Plaintiffhas failed t0 state a Viable claim for fraud. For all these reasons, GM’s Demurrer t0 the third cause 0f action for Fraudulent Inducement-Concealment should be sustained without leave t0 amend. Dated: February 17, 2022 ERSKINE LAW GROUP, PC MARY ARENS MCBRIDE, Esq. JED VONDIELINGEN, Esq. Attorneys for Defendant, GENERAL MOTORS LLC Page 15 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES J; KOOONONUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PROOF OF SERVICE I am employed in the County 0f Orange and my business address is 1576 N. Batavia St., Suite A, Orange, CA 92867. 1am over the age 0f 18 years and I am not a party t0 this action. I am readily familiar with the practices 0f Erskine Law Group for the collection and processing 0f correspondence for mailing with the United States Postal Service. Such correspondence is deposited with the United States Postal Service the same day in the ordinary course 0f business. On February 17, 2022, I served the foregoing document(s), bearing the title(s): DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES 0n the interested parties in the action as follows: [X] by placing [ ] the original [X] a true copy thereof enclosed in a sealed envelope addressed as follows: DAVID N. BARRY, Esq. OTIS R. HAYES HI, Esq. THE BARRY LAW FIRM 11845 West Olympic B1Vd., Suite 1270 Los Angeles, CA 90064 Phone: (310) 684-5859; Fax: (310) 862-4539 eservicegm@mylemonrights.com [ ] (BY MAIL SERVICE) Iplaced such envelopes for collection and t0 be mailed 0n this date following ordinary business practices. [ ] (BY PERSONAL SERVICE) I caused t0 be delivered such envelope by hand t0 the office 0f the addressee. [ ] (BY FACSIMILE) The document stated herein was transmitted by facsimile transmission and the transmission was reported as complete and without error. A transmission report was properly issued by the transmitting facsimile machine and a copy 0f said transmission report is attached t0 the original proof 0f service indicating the time 0f transmission. (BY NEXT DAY DELIVERY) I caused t0 be delivered such envelope by hand t0 the office 0f the addressee. [X] (BY E-MAIL) I served the above mentioned document Via electronic transmission per agreement 0f the parties. [X] (State) I declare under penalty 0f pteury under the laws 0f the State 0f California that the foregoing is true and correct. [ ] (Federal) I declare under penalty 0fpteury that I am employed by a member 0f the Bar 0f this Court, at whose direction this service is made. Executed 0n February 17, 2022, at Orange, CA. Signed; l Stanley Chan Page 16 0f 16 DEFENDANT GENERAL MOTORS LLC’S NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS OF AUTHORITIES