King v. General Motors LLC

Background

Jacqueline King sued General Motors LLC over her purchase of a new 2020 Chevrolet Bolt from “Silveira Chevrolet,” which the opinion describes as an authorized GM dealer and agent. King alleged that GM represented the vehicle as safe and functional for normal use even though GM knew of problems affecting battery safety, battery capacity, mileage range, and the ability to park the vehicle indoors overnight.

The First Amended Complaint asserted three claims under the Song-Beverly Consumer Warranty Act, a fraud claim as the Fourth Cause of Action, and a claim under California’s Unfair Competition Law, Business and Professions Code section 17200, as the Fifth Cause of Action. The Fifth Cause of Action asserted unlawful, unfair, and fraudulent theories. GM moved to dismiss the Fourth and Fifth Causes of Action under Federal Rules of Civil Procedure 9(b) and 12(b)(6). Rule 12(b)(6) permits dismissal when a complaint does not state a legally sufficient claim, and Rule 9(b) requires fraud to be described with particularity, including who made the statement, what was said, when and where it was said, and how it was misleading.

Fraudulent Misrepresentation Claims

King alleged that GM misrepresented the Bolt’s battery capacity and indoor-storage ability. The court held that the complaint did not plausibly allege that GM knew, at the time of sale, that the batteries in the relevant 2020 model had defects affecting safety and mileage range. The allegations that GM had learned of some battery issues in earlier years, created battery-replacement and repair programs, and was aware of one Bolt battery fire in March 2019 were not enough to support the required inference of pre-sale knowledge.

The court also considered King’s allegation that a December 2021 letter from GM Vice-President Steven Hill promised that her battery would be replaced. The court held that King had not adequately alleged that Hill intended to defraud her when he made that promise.

The court therefore granted GM’s motion to dismiss both affirmative-misrepresentation theories. It dismissed those claims without leave to amend, citing King’s prior opportunity to amend, her lack of a request for another amendment, and the absence of additional allegations in a prior related proceeding involving similar allegations.

Fraudulent Concealment Claim

King also alleged that GM concealed information about the Bolt’s battery-charging and indoor-storage problems. Because the court found that the complaint did not adequately plead GM’s pre-sale knowledge of the alleged defects, it applied that ruling to the concealment claim and granted the motion to dismiss it. The court did not grant leave to amend this claim.

Unfair Competition Law Claims

The court addressed King’s remaining claims under California’s Unfair Competition Law, which prohibits unlawful, unfair, or fraudulent business acts or practices. GM argued that King had not shown that she lacked an adequate legal remedy, a requirement for obtaining equitable relief under the law in a diversity case. King did not respond to that argument in her opposition brief.

The court agreed with GM and held that King had not established the required basis for equitable relief because she had not shown that she lacked an adequate remedy under the Song-Beverly Act. The court stated that no amendment could cure this deficiency and dismissed the UCL claims based on the unlawful and unfair prongs without prejudice. It dismissed the UCL claim based on the fraudulent prong without leave to amend.

Disposition

The court granted GM’s motion to dismiss the Fourth and Fifth Causes of Action. The Fourth Cause of Action, consisting of affirmative misrepresentation and fraudulent concealment, and the fraudulent portion of the Fifth Cause of Action were dismissed without leave to amend. The unlawful and unfair portions of the Fifth Cause of Action were dismissed from the case without prejudice.

The court also denied, without prejudice, GM’s request for judicial notice of the Environmental Protection Agency’s estimated mileage range for 2020–2022 model-year Chevrolet Bolts.