Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_18-cv-07040/USCOURTS-cand-3_18-cv-07040-0/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1441 Petition for Removal

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United States District Court

Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

NICHOLAS BENIPAYO, et al.,

Plaintiffs,

v.

VOLKSWAGEN GROUP OF AMERICA, 

INC., et al.,

Defendants.

Case No. 15-md-02672-CRB 

ORDER GRANTING IN PART AND 

DENYING IN PART MOTION FOR 

SUMMARY JUDGMENT

This case arises from Volkswagen’s evasion of United States and California emissions 

standards by equipping “clean diesel” vehicles with hidden defeat devices that gamed emissions 

testing procedures. The majority of the civil suits against Volkswagen were resolved by a pair of 

settlements (the “Class Settlements”) approved by this Court. Plaintiffs in this case are ten optouts bringing state common law and statutory claims against Volkswagen Group of America, Inc. 

(“Volkswagen America”) and Volkswagen Aktiengesellschaft (“Volkswagen Germany,” 

collectively, “Volkswagen”). See, e.g. Clendenen Amended Compl. (MDL dkt. 6462) ¶ 3. 

Volkswagen has moved for summary judgment on Plaintiffs’ Song-Beverly Consumer Warranty 

Act and Consumers Legal Remedies Act claims. See generally Mot. (Clendenen dkt. 14).1 

Because Plaintiffs cars were merchantable despite the presence of the defeat devices, 

Volkswagen’s motion for summary judgment on the Song-Beverly Act claims is granted. At this 

1

 A since-resolved technical problem forced Volkswagen to file its motion for summary judgment 

on the docket for Clendenen v. Volkswagen Group of America, Inc., No. 18-cv-07040-CRB, one 

of the individual cases at issue here. Other relevant documents were filed in the multi-district 

litigation docket, In re: Volkswagen “Clean Diesel” Marketing, Sales Practices, and Products 

Liability Litigation, No. 15-md-02672-CRB. This Order indicates which docket court filings 

appear on by specifying that the docket is either “Clendenen” or “MDL.”

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stage of the proceedings, there is a genuine issue of material fact over whether the Class 

Settlements constituted an appropriate correct offer under the CLRA, and Volkswagen has waived 

its argument that it did not receive proper notice of Plaintiffs’ claims for damages under the 

CLRA. Volkswagen’s motion for summary judgment on Plaintiffs’ CLRA damages claims is 

therefore denied. Plaintiffs’ request for injunctive relief under the CLRA is moot, so 

Volkswagen’s motion for summary judgment on those claims is granted.

I. BACKGROUND

This Court has previously described the events that are the basis for Plaintiffs’ claims:

Over the course of six years, Volkswagen sold nearly 500,000 

Volkswagen– and Audi-branded TDI “clean diesel” vehicles, which 

they marketed as being environmentally friendly, fuel efficient, and 

high performing. Consumers were unaware, however, that 

Volkswagen had secretly equipped these vehicles with a defeat 

device that allowed Volkswagen to evade United States 

Environmental Protection Agency (“EPA”) and California Air 

Resources Board (“CARB”) emissions test procedures. Specifically, 

the defeat device produces regulation-compliant results when it 

senses the vehicle is undergoing testing, but operates a less effective 

emissions control system when the vehicle is driven under normal 

circumstances. It was only by using the defeat device that 

Volkswagen was able to obtain Certificates of Conformity from 

EPA and Executive Orders from CARB for its TDI diesel engine 

vehicles. In reality, these vehicles emit nitrogen oxides (“NOx”) at a 

factor of up to 40 times over the permitted limit.

In re: Volkswagen “Clean Diesel” Mktg., Sales Practices, & Prod. Liab. Litig., No. 15-md-02672-

CRB (JSC), 2016 WL 6248426, at *1 (N.D. Cal. Oct. 25, 2016). The scandal led to numerous 

government actions and over a thousand civil lawsuits, which were consolidated before this Court 

by the Judicial Panel on Multidistrict Litigation. Id. at *2.

Several of the government actions resulted in guilty pleas, consent orders, and consent 

decrees relevant here. Volkswagen’s Federal Trade Commission Consent Order enjoins it from 

selling, leasing, marketing, or advertising any vehicle with a defeat device, Partial Stipulated 

Order for Permanent Injunction and Monetary Judgment (“FTC Consent Order”) (MDL dkt. 2104) 

at 11, and its First and Second Partial Consent Decrees with the EPA prohibit it from selling TDI 

vehicles without an approved emissions modification (AEM) and disclosures approved by the 

EPA and CARB, First Partial Consent Decree (MDL dkt. 2103-1) App’x A § 7.2.3 & 7.2.4, App’x 

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B § 7.2.4; Second Partial Consent Decree (MDL dkt. 3228-1) App’x A § 11.2.3. The Plea 

Agreement that resolved the criminal case against Volkswagen promised that neither it, its 

officers, directors, employees, or agents would “make any public statement” contradicting its 

guilty plea. Mot. Ex. DD (Clendenen dkt. 14-32) ¶ 14.A.

The bulk of the civil actions were resolved in two settlements (one concerning 2.0-liter 

TDI vehicles and another for 3.0-liter TDI vehicles) approved by this Court. See generally In re:

Volkswagen, 2016 WL 6248426; 3.0-Liter Class Action Settlement Approval Order (MDL 

dkt. 3229). The 2.0-Liter Class Settlement offered the owners of TDI diesel vehicles their choice 

of two remedies. Volkswagen would either buy their cars back at the pre-defeat device value or 

fix their cars with an emissions modification. In re: Volkswagen “Clean Diesel” Mktg., Sales 

Practices, & Prod. Liab. Litig., 2016 WL 6248426, at *4. Lessees similarly had two options. 

Volkswagen would let them cancel their leases with no penalty or fix their vehicle. Id. Both 

owners and lessees were entitled to cash restitution on top of their choice of remedy. Id. Former 

owners who sold their vehicle before June 28, 2016, were entitled to at least $2,550 in cash 

restitution. Amended Consumer Class Action Settlement Agreement Ex. 3 (MDL dkt. 1685-3) at 

8–9. The 3.0-Liter Class Settlement offered a similar deal. All owners had the option of receiving 

a free repair, an extended emissions warranty, and cash restitution. See generally Amended 3.0-

Liter Class Action Settlement Agreement Ex. 2 (MDL dkt. 2894-2). Both settlements required 

class members to release all claims arising from the emissions scandal. In re: Volkswagen “Clean 

Diesel” Mktg., Sales Practices, & Prod. Liab. Litig., 2016 WL 6248426, at *25; 3.0-Liter Class 

Action Settlement Approval Order at 13–14. Volkswagen has allowed opt-outs to participate in 

the Class Settlements despite having opted out. Monahan Decl. (Clendenen dkt. 14-2) ¶ 60.

Plaintiffs Richard and Virginia Ortiz currently own a 2.0-liter TDI diesel vehicle. 

Mot. Ex. G (Clendenen dkt. 14-9). Plaintiff Scott Salzer used to own a 2.0-liter TDI diesel 

vehicle. Mot. Ex. S (Clendenen dkt. 14-21) at 82:19–21, 85:10–21. Plaintiff Julia Robertson 

leased a 2.0-liter TDI vehicle for three years, beginning in September 2013. Mot. Ex. N 

(Clendenen dkt. 14-16). Plaintiffs Byron Clendenen, Kenneth and Maria Coon, and Luke and 

Kathryn Sanwick currently own 3.0-liter TDI diesel vehicles. Mot. Ex. A (Clendenen dkt. 14-3); 

Case 3:18-cv-07040-CRB Document 31 Filed 02/04/20 Page 3 of 13
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Mot. Ex. C (Clendenen dkt. 14-5); Mot. Ex. T (Clendenen dkt. 14-22). Plaintiff Timothy Riley 

used to own a 3.0-liter TDI diesel vehicle. Mot. Ex. M (Clendenen dkt. 14-15).

All ten Plaintiffs opted out of the applicable Class Settlement. See Mot. Exs. W, X, Y, Z, 

AA, BB, and CC (Plaintiffs’ opt-out notices) (Clendenen dkt. 14-25–14-31). They have each 

brought fraud claims and claims under California’s Song-Beverly Act. See, e.g. Clendenen 

Amended Compl. Every plaintiff but Riley has also brought a claim under the CLRA. See, e.g.

id.; Mot. at 3 n.1. Volkswagen has moved for summary judgment on just the statutory claims. 

See generally Mot.

II. LEGAL STANDARD

Summary judgment is appropriate “if the movant shows that there is no genuine dispute as 

to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. 

P. 56(a). A fact is material if it could affect the outcome of the case “under the governing law.” 

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute of material fact is genuine 

if the evidence, viewed in the light most favorable to the nonmoving party, “is such that a 

reasonable jury could return a verdict for the nonmoving party.” Id.

The party moving for summary judgment bears the initial burden of identifying those 

portions of the pleadings, discovery, and affidavits that demonstrate the absence of a genuine issue 

of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party will have 

the burden of proof at trial, it must affirmatively show that no reasonable jury could find other 

than in the moving party’s favor. Id. at 331 (Brennan, J., dissenting). 

Once the moving party meets its initial burden, the nonmoving party must “set forth 

specific facts showing that there is a genuine issue for trial.” Anderson, 477 U.S. at 250 (internal 

quotation marks and citations omitted). Because the court has no obligation to “scour the record 

in search of a genuine issue of triable fact,” the nonmoving party must “identify with reasonable 

particularity the evidence that precludes summary judgment.” Kennan v. Allan, 91 F.3d 1275, 

1279 (9th Cir. 1996). If the nonmoving party fails to raise a genuine issue as to any material fact, 

the moving party is entitled to judgment as a matter of law. Anderson, 477 U.S. at 250. In 

determining whether there is a genuine issue for trial, the court does not weigh the evidence, 

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assess the credibility of witnesses, or resolve issues of fact. Id. at 249.

III. DISCUSSION

A. Song-Beverly Consumer Warranty Act

The Song-Beverly Act provides consumers with a right of action for breaches of the 

implied warranty of merchantability, which guarantees that goods will “(1) [p]ass without 

objection in the trade under the contract description,” “(2) [a]re fit for the ordinary purposes for 

which such goods are used,” “(3) [a]re adequately contained, packaged, and labeled,” and 

“(4) [c]onform to the promises or affirmations of fact made on the container or label.” Cal. Civ. 

Code § 1791.1(a), (d). “The core test of merchantability is fitness for the ordinary purpose for 

which such goods are used.” Isip v. Mercedes-Benz USA, LLC, 155 Cal. App. 4th 19, 26 (Cal. 

Ct. App. 2007). Simply showing that a product “did not precisely fulfill the expectation of the 

buyer” does not satisfy this standard. Am. Suzuki Motor Corp. v. Super. Ct., 37 Cal. App. 4th 

1291, 1296 (Cal. Ct. App. 1995). The implied warranty of merchantability “provides for a 

minimum level of quality,” and is breached only when goods lack “even the most basic degree of 

fitness for ordinary use.” Birdsong v. Apple, Inc., 590 F.3d 955, 958 (9th Cir. 2009) (internal 

citations and quotation marks omitted).

As applied to automobiles, the implied warranty of merchantability will be breached by “a 

defect that is so basic it renders the vehicle unfit for its ordinary purpose of providing 

transportation.” Am. Suzuki, 37 Cal. App. 4th at 1296. This does not mean that an automobile is 

merchantable so long as it is capable of “provid[ing] transportation from point A to point B.” Isip, 

155 Cal. App. 4th at 27. Vehicles must also be “in safe condition and substantially free of 

defects.” Id. Defects that render a car unsafe or particularly unpleasant to drive, but not 

inoperable, may nonetheless violate the warranty of merchantability. See id. (“A vehicle that 

smells, lurches, clanks, and emits smoke over an extended period of time is not fit for its intended 

purpose.”); Brand v. Hyundai Motor Am., 226 Cal. App. 4th 1538, 1547 (Cal. Ct. App. 2014) 

(jury could reasonably infer that the implied warranty of merchantability was violated by “a 

vehicle sunroof that opens and closes on its own” because that defect “creates a substantial safety 

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hazard”).

There is no genuine dispute that Plaintiffs’ cars were merchantable. Plaintiffs claim their 

vehicles were defective because they contained defeat devices that allowed Volkswagen to evade

California and U.S. emissions standards. Opp’n (Clenenden dkt. 24) at 9–10. But the defeat 

devices and increased emissions did not render Plaintiffs’ cars inoperable, pose an immediate 

danger to Plaintiffs, their passengers, or anyone else, or affect the cars’ performance in any way 

Plaintiffs were aware of before the emissions scandal came to light. See Mot. Ex B (Clendenen 

dkt. 14-4) at 297:23–298:10, 298:14–22; Ex. E (Clendenen dkt. 14-7) at 70:5–21, 108:13–18, 

282:13–23; Ex. I (Clendenen dkt. 14-11) at 82:4–24; Ex. L (Clendenen dkt. 14-14) at 159:6, 

160:17; Ex. P (Clendenen dkt. 14-18) at 72:21–25, 227:4, 256:16–21; Ex. S at 82:8–12, 125:25–

126:12; Ex. U (Clendenen dkt. 14-23) at 160:11–22, 178:7–16, 247:19–23; Ex. V (Clendenen 

dkt. 14-24) at 211:1–3, 261:20–22, 265:17–20. The defects in this case are therefore unlike those 

that previous courts have found sufficient to render a car unmerchantable. See, e.g. Brand, 226 

Cal. App. 4th at 1547 (defective sunroof increased the danger of a crash); Isip, 155 Cal. App. 4th 

at 27 (car was unmerchantable because it stank, lurched, and emitted smoke); Salas v. Toyota 

Motor Sales, U.S.A., Inc., No. CV 15-8629 FMO (EX), 2017 WL 11247885, at *4 (C.D. Cal. 

Sept. 29, 2017) (persistent “stench” could have rendered car unmerchantable). The defeat device 

and higher emissions are akin to a defect which required more frequent refueling but did not 

otherwise “implicate the [car’s] operability.” Troup v. Toyota Motor Corp., 545 F. App’x 668, 

669 (9th Cir. 2013). The Ninth Circuit has held in an unpublished disposition that that defect, 

which “did not compromise the vehicle’s safety, render it inoperable, or drastically reduce its 

mileage range,” did not constitute a breach of the warranty of merchantability as a matter of law. 

Id.

Plaintiffs’ arguments to the contrary are not well-taken. First, they argue that their “cars 

did not function as clean-diesel, low emissions vehicles, which was their ordinary use.” Opp’n at 

10–11. This defines the relevant “ordinary use” too specifically, especially in light of caselaw 

holding that a car’s ordinary use is transportation. See Am. Suzuki, 37 Cal. App. 4th at 1296.

Second, Plaintiffs point to the implied warranty of merchantability’s requirement that 

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goods “[c]onform to the promises or affirmations of fact made on the container or label,” Cal. Civ. 

Code § 1791.1(a)(4), and argue that “[t]he statements made in the labels provided on the vehicles 

regarding emissions were . . . patently false.” Opp’n at 11. But the heart of the merchantability 

inquiry is fitness for use, not conformity to labeling, and courts have held that mislabeling alone 

cannot render a product unmerchantable. See, e.g. Thomas v. Costco Wholesale Corp., No. 12-

CV-02908-BLF, 2014 WL 5872808, at *3 (N.D. Cal. Nov. 12, 2014) (“Mislabeling of a product is 

not the sort of ‘fundamental defect’ that the implied warranty of merchantability is designed to 

protect against.”).

Courts have similarly rejected arguments akin to Plaintiffs’ theory that a car that does not 

meet emissions standards set by law is by definition unmerchantable or necessarily fails to meet a 

“minimum level of quality.” Opp’n at 11; see also Thomas, 2014 WL 5872808, at *3 (rejecting 

argument that a product was not merchantable because it “could not be legally sold or held”); 

Swearingen v. Amazon Pres. Partners, Inc., No. 13-CV-04402-WHO, 2014 WL 3934000, at *1 

(N.D. Cal. Aug. 11, 2014) (holding allegations that a product was “illegal” insufficient to allege 

that it “lack[ed] even the most basic degree of fitness for ordinary use”). Plaintiffs attempt to 

distinguish these cases by pointing out that they involved food products. Opp’n at 8–9. But they 

do not explain why the principle that regulatory violations do not necessarily establish 

unmerchantability should not apply more generally.2 A product may be used even if it violates 

regulatory requirements. Given the merchantability inquiry’s focus on fitness for ordinary use, it 

makes sense that a regulatory violation is not dispositive of merchantability. This does not mean 

that a legal violation could never make an automobile unmerchantable. If, for example, a car 

could not legally be driven because it was not in compliance with applicable regulations, it would 

be effectively inoperable and might therefore be unmerchantable. But that was not the case here. 

Even after the defeat devices came to light, Plaintiffs’ vehicles remained legal to drive. Mot. 

Ex. ZZ (dkt. 14-54) at 2.

2

 At least one court has reached a similar result in the automobile context. See Amata v. Toyota 

Motor Sales, U.S.A., Inc., No. EDCV 12-00168-VAP (SPx), 2013 WL 12248140, at *7 (C.D. Cal. 

Apr. 29, 2013) (vehicle was not “unfit for ordinary use,” even though its “rear license plate [was] 

not illuminated, as required by law”).

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Finally, Plaintiffs argue their cars were not “safe” because they emitted increased levels of 

chemicals harmful to human health. Id. at 11. Previous cases finding that unsafe defects rendered 

a car unmerchantable have involved an increased risk of immediate injury, not generalized 

environmental harms. See, e.g. Brand, 226 Cal. App. 4th at 1547. That makes sense. A car that 

cannot be driven without an unreasonable risk of preventable injury may not safely transport the 

driver to their destination and is likely not to be driven at all. It thus implicates the core question 

regarding a vehicle’s merchantability: Whether or not the car provides reliable transportation. 

Increased emissions do not implicate the ability to provide transportation.

Because there is no genuine dispute that the Plaintiffs’ cars were merchantable, 

Volkswagen’s motion for summary judgment as to Plaintiffs’ Song-Beverly Act claims is granted. 

It is therefore unnecessary to decide whether Plaintiffs are entitled to revocation under that law. 

See Mot. at 20–22, Opp’n at 12–14.

B. Consumers Legal Remedies Act

Volkswagen argues that it should be granted summary judgment on Plaintiffs’ claims for 

damages under the CLRA because it made each of them an appropriate correction offer, Mot. at 

25–29, and Plaintiffs failed to provide the required statutory notice, id. at 22–24. It also argues 

Plaintiffs’ claims for injunctive relief under the CLRA must be dismissed because Plaintiffs’ lack 

Article III standing to seek injunctive relief, the request for injunctive relief is moot, and Plaintiffs 

have an adequate remedy at law. Id. at 29–30.

1. Correction Offer

California Civil Code § 1782(b) provides that “no action for damages may be maintained 

under Section 1780 if an appropriate correction, repair, replacement, or other remedy is given, or 

agreed to be given within a reasonable time, to the consumer within 30 days after receipt of the 

notice.” Volkswagen argues that the Class Settlements constituted an appropriate correction offer 

to each of the Plaintiffs,3foreclosing damages claims under the CLRA.4

3

 Besides Riley, who has not brought a CLRA claim. Mot. at 13 n.6.

4

 Volkswagen also believes the Class Settlements satisfy the requirements of California Civil 

Code 1782(c), a similar provision which applies to CLRA class actions. This is not a class action, 

so the application of section 1782(c) is beside the point.

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As a preliminary matter, Plaintiffs assert that under California Civil Code § 1784, 

Volkswagen can only benefit from a correction offer if the alleged CLRA violations were “not 

intentional and resulted from a bona fide error.” Opp’n at 26. The problem with this theory is that 

section 1784 announces a separate defense with different requirements from the section 1782 

defense Volkswagen is asserting.5 Compare Cal. Civ. Code 1784, with Cal. Civ. Code 1782(b). It 

does not announce additional requirements for the section 1782 defense. This is confirmed by the 

fact that cases applying the section 1782 defense have not required a showing of good faith. See 

generally, e.g. Benson v. Southern Cal. Auto Sales, Inc., 239 Cal. App. 4th 1198 (Cal. Ct. App. 

2015).

The parties also disagree over whose place it is to determine that an appropriate correction 

offer has been made. Plaintiffs seem to suggest that if there is any dispute as to the 

“appropriateness” of an offer, that determination must be made by a jury. Opp’n at 23–24. But a 

California Court of Appeals decision holds that “the determination of appropriateness of a 

correction offer under the CLRA should be left to the trial court’s discretion.” Benson, 239 Cal. 

App. 4th at 1207. At least one unpublished California appellate decision has cited this language as 

establishing that this is “a legal question that must be decided by the trial court.” Duran v. 

Quantum Auto Sales, Inc., No. G052968, 2017 WL 6333871, at *17 (Cal. Ct. App. Dec. 12, 

2017). Plaintiffs’ authorities, on the other hand, are orders on motions to dismiss CLRA damages 

claims under section 1782(b). They establish only that the court could not determine whether an 

appropriate correction had been made at the pleading stage. See In re MacBook Keyboard Litig., 

No. 5:18-cv-02813-EJD, 2019 WL 6465285, at *10 (N.D. Cal. Dec. 2, 2019); Luong v. Subaru of 

Am., Inc., No. 17-cv-03160-YGR, 2018 WL 2047646, at *6 (N.D. Cal. May 2, 2018); In re 

Toyota Motor Corp. Hybrid Brake Mktg., Sales, Practices and Prods. Liab. Litig., 890 F. Supp. 2d 

1210, 1218 (C.D. Cal. 2011).

The dispositive question, then, is whether the Class Settlements constitute an appropriate 

5

 Volkswagen’s motion for summary judgment does cite section 1784 once. Mot. at 25. 

Volkswagen’s reply clarifies that this solitary reference to section 1784 was a typo. Reply at 13 

n. 11.

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correction offer.6 This question presents a genuine dispute of material fact which the Court cannot 

resolve at this stage of the litigation. Plaintiffs make three arguments that the Class Settlements 

were not appropriate correct offers. First they point out that the Class Settlements would have 

required them to release other, non-CLRA claims. Opp’n at 24–25. Some (but not all) courts 

have held that “a correction offer cannot require the consumer to release claims that would not 

otherwise be barred under section 1782.” See, e.g. Valdez v. Seidner-Miller, Inc., 33 Cal. App. 

5th 600, 615 (Cal. Ct. App. 2019); but see Benson, 239 Cal. App. 4th at 1211 (holding that trial 

court did not abuse its discretion by holding that a correction offer was appropriate even though it 

required plaintiff to release “nine different versions of the same cause of action”). Second, 

Plaintiffs suggest that the Class Settlements were inadequate because “each consumer would 

receive only a portion of their vehicle purchase price.” Opp’n at 25. Third, Plaintiffs argued that 

the Class Settlements offered remedies “subject to Volkswagen’s unilateral determination based 

on subjective criteria.” The Court cannot evaluate these points without weighing the evidence and 

determining issues of fact, which would be inappropriate on a motion for summary judgment. 

Anderson, 477 U.S. at 250.

However, given Benson’s direction that this issue should be decided by the Court, it 

appears that it would be appropriate for the Court to determine whether the Class Settlements 

constituted appropriate CLRA correction offers after the close of evidence and with the benefit of

an advisory jury verdict, pursuant to Federal Rule of Civil Procedure 52(a)(1).

2. Notice

Plaintiffs who bring a claim for damages under the CLRA must first provide the defendant 

with notice of the alleged violation, and “[d]emand that the [defendant] correct, repair, replace, or 

otherwise rectify the goods or services alleged to be in violation” of the CLRA. Cal. Civ. Code 

§ 1782(a). Notice must “be in writing and shall be sent by certified or registered mail, return 

receipt requested, to the place where the transaction occurred or to the [defendant’s] principal 

6

 Plaintiffs do not deny having received these offers in compliance with section 1782(b)’s 

requirements. See Opp’n at 23–26.

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place of business within California” at least thirty days before the claim for damages is filed. Id.

§ 1782(a). 

The Court need not decide whether Plaintiffs failed to satisfy this requirement, as 

Volkswagen argues, because Volkswagen has waived its objection to the sufficiency of notice. 

Most courts agree that challenges to the sufficiency of section 1782 notice can be waived when the

defendants explicitly indicate they recognize the relevant communication as section 1782(a) 

notice, despite any ostensible deficiencies. See, e.g. Outboard Marine Corp.v. Sup. Ct., 52 Cal. 

App. 3d 30, 41 (Cal. Ct. App. 1975) (notice waived by communication stating that the defendant 

was treating the letter it had received “as a preliminary notice and demand under California Civil 

Code 1782a”), abrogated by statute on other grounds as stated in Flores v. Southcoast Auto. 

Liquidators, Inc., 17 Cal. App. 5th 841, 851 (Cal. Ct. App. 2017); Jones v. Porsche Cars N. Am., 

Inc., No. CV 15-5766-GW(SSX), 2015 WL 11995257, at *4 (C.D. Cal. Oct. 15, 2015) (notice 

waived by communication stating that defendants had received letter “that purports to serve as a 

notice and demand under the [CLRA]”); but see Shein v. Canon U.S.A., Inc., No. CV 08-07323

CAS (Ex), 2009 WL 3109721, at *6 (C.D. Cal. Sept. 22, 2009) (holding that objections to the 

adequacy of CLRA notice cannot be waived). 

That is exactly what happened here. According to its own exhibits, Volkswagen responded 

to the Plaintiffs’ CLRA letters with a CLRA correction offer. Mot. Exs. NN, OO, PP (dkt. 14-42, 

14-43, 14-44). None of those responses stated that Volkswagen considered the CLRA letters 

inadequate. See id. This undisputed record evidence shows that Volkswagen treated Plaintiffs’

letters as CLRA notice and gave Plaintiffs no reason to believe it would later challenge the 

sufficiency of that notice. This response meets Outboard Marine’s standard of “conduct so 

inconsistent with the intent to enforce the right in question as to induce a reasonable belief it has 

been relinquished.” 52 Cal. App. 3d at 41. 

Volkswagen’s failure to raise its objection to the sufficiency of notice in its reply to 

Plaintiffs’ CLRA letters is particularly troubling because if it had raised the issue sooner, Plaintiffs 

could have re-noticed Volkswagen immediately, well before this case went to trial. By waiting to 

raise the issue with Plaintiffs, Volkswagen created a situation where the typical remedy for 

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inadequate notice, dismissal with leave to amend after proper notice is sent, would have required a 

continuance of trial and inconvenient delays for the parties and the Court.7 Morgan v. AT&T 

Wireless Services, Inc., 177 Cal. App. 4th 1235, 1261 (Cal Ct. App. 2009) (inadequate CLRA 

notice requires only dismissal of the CLRA damages claim, without prejudice, “until 30 days or 

more after the plaintiff complies with the notice requirements”).

3. Injunctive Relief

“Claims for injunctive relief become moot when the challenged activity ceases if 

subsequent events have made it clear that the alleged violations could not reasonably be expected 

to recur.” Ruiz v. City of Santa Maria, 160 F.3d 543, 549 (9th Cir. 1998) (internal quotation 

marks and citations omitted). That is the case here. Plaintiffs request an injunction directing 

Volkswagen to “disclose fully, prior to the sale or lease, the inherent engine defects in vehicles 

equipped with the TDI engine with a defeat device . . . and desist from selling these vehicles with 

the foregoing pre-sale disclosure” and “to prevent Volkswagen from refusing to acknowledge its 

scheme to intentionally defraud consumers, including Plaintiff[s], and the California CARB.” 

Clendenen Amended Compl. ¶ 151. This injunction is entirely unnecessary in light of 

Volkswagen’s FTC Consent Order, First and Second Partial Consent Decrees with the EPA, and 

Plea Agreement. Those orders, decrees, and agreements already prevent Volkswagen from 

engaging in such misbehavior. See FTC Consent Order at 11; First Partial Consent Decree App’x 

A § 7.2.3 & 7.2.4, App’x B § 7.2.4; Second Partial Consent Decree App’x A § 11.2.3; Mot. 

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 Volkswagen argues that inadequate notice requires dismissal with prejudice, citing a line of 

authority tracing back to Outboard Marine’s direction that section 1782(a)’s requirements be given 

“literal application.” See Trabakoolas v. Watts Water Techs., Inc., No. 12-CV-01172-YGR, 2012 

WL 2792441, at *7 (N.D. Cal. July 9, 2012) (collecting cases). Some cases conclude that a 

“literal application” of section 1782(a) requires dismissal with prejudice when the notice 

requirements are not satisfied. Id. But after Morgan, the weight of persuasive precedent, 

including in this district, takes that case’s approach of dismissal without prejudice. See, e.g.

Romero v. Flowers Bakeries, LLC, No. 14-cv-05189-BLF, 2015 WL 2125004, at *8 (N.D. Cal. 

May 6, 2015) (“Courts in this District have determined that it is consistent with California law and 

with the purposes of the statute to dismiss a CLRA claim for damages without prejudice to 

amending once a plaintiff can demonstrate compliance with the notice requirements.”). And it is 

not at all clear that Outboard Marine requires dismissal with prejudice. The CLRA claims in that 

case were not dismissed, because the defendant waived its challenge to notice. Outboard Marine, 

52 Cal. App. 3d at 41. It may well be that courts have read too much into Outboard Marine’s 

dicta, and that post-Morgan there is no split of California authority—just a California Court of 

Appeals decision endorsing dismissal without prejudice in these circumstances.

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