Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_19-cv-01691/USCOURTS-casd-3_19-cv-01691-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 15:2301 Magnuson-Moss Warranty Act

---

1

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

HOWELL HSIEH

Plaintiff,

v.

FCA US LLC; STERICYCLE, INC., 

Defendants.

Case No.: 19-cv-01691 W (AHG)

ORDER: (1) DENYING IN PART 

DEFENDANT STERICYCLE, INC’S 

MOTION [DOC. 7] AND

(2) GRANTING DEFENDANT FCA’S 

MOTION TO DISMISS [DOC. 8]

WITHOUT LEAVE TO AMEND

Pending before the Court are Defendants FCA US LLC’s and Stericycle Inc.’s 

motions to dismiss under Federal Rule of Civil Procedure 12(b)(6). The Court decides 

the matters on the papers submitted and without oral argument. Civ. L.R. 7.1(d)(1). 

For the reasons stated below, the Court DENIES IN PART and GRANTS IN 

PART Defendant Stericycle, Inc.’s motion [Doc. 7] and GRANTS Defendant FCA US 

LLC’s’ motion [Doc. 8] WITHOUT LEAVE TO AMEND.

//

//

//

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 1 of 8
2

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

I. BACKGROUND

According to the Complaint, on September 8, 2019, Plaintiff purchased a 2018 

Jeep Grand Cherokee, “which was manufactured and or distributed by Defendant.” 

(Compl.

1

¶ 4.) The vehicle was covered by an express written warranty “in which 

Defendant undertook to preserve or maintain the utility or performance of the Vehicle or 

to provide compensation if there is a failure in utility or performance for a specified 

period of time.” (Id. ¶ 5.)

During the warranty period, Plaintiff experienced problems with the vehicle. 

These included a “rapid popping sound from the engine area of the Vehicle, engine 

failure while driving and/or engine ‘die’ while driving, lack of power and/or no power, no 

start, all while on public roadways.” (Compl. ¶ 6.) Plaintiff alleges that “Defendant and 

its representatives” have been unable to repair the vehicle, and that “Defendant failed to 

promptly replace the Vehicle or make restitution to Plaintiff....” (Id. ¶ 7.)

On August 1, 2019, Plaintiff filed this lawsuit against Defendants FCA US LLC 

and Stericycle Inc. in the San Diego Superior Court. (See Compl.) The Complaint 

asserts thirteen causes of action for: (1) Violation of California Civil Code § 1793.2(d); 

(2) Violation of California Civil Code § 1793.2(b); (3) Violation of California Civil Code 

§ 1793.2(a)(3); (4) Breach of Express Warranty under Cal. Civ. Code § 1794; (5) Breach 

of Implied Warranty under Cal. Civ. Code § 1794; (6) Violation of the Magnuson-Moss 

Warranty Act, 15 U.S.C. § 2301, et seq.; (7) Fraud by Omission; (8) Fraud–Concealment; 

(9) Intentional or Negligent Misrepresentation; (10) Fraud– Concealment; 

(11) Negligence; (12) Violation of California Business & Professions Code § 17200; and 

(13) Conspiracy. On September 5, 2019, Defendants removed the case to this Court. 

(See Notice of Removal.) Defendant Stericycle, Inc. now seeks to dismiss the Complaint 

for failure to state a claim, and Defendant FCA US, LLC seeks to dismiss the tort causes 

of action.

 

1 A copy of the Complaint is attached to the Notice of Removal [Doc. 1] as Exhibit B [Doc. 1-3].

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 2 of 8
3

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

II. LEGAL STANDARD

The Court must dismiss a cause of action for failure to state a claim upon which 

relief can be granted. Fed. R. Civ. P. 12(b)(6). A motion to dismiss under Rule 12(b)(6) 

tests the legal sufficiency of the complaint. See Parks Sch. of Bus., Inc. v. Symington, 51 

F.3d 1480, 1484 (9th Cir. 1995). A complaint may be dismissed as a matter of law either 

for lack of a cognizable legal theory or for insufficient facts under a cognizable theory. 

Balistreri v. Pacifica Police Dep’t., 901 F.2d 696, 699 (9th Cir. 1990). In ruling on the 

motion, a court must “accept all material allegations of fact as true and construe the 

complaint in a light most favorable to the non-moving party.” Vasquez v. L.A. Cty., 487 

F.3d 1246, 1249 (9th Cir. 2007).

Complaints must contain “a short and plain statement of the claim showing that the 

pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). The Supreme Court has interpreted 

this rule to mean that “[f]actual allegations must be enough to rise above the speculative 

level.” Bell Atl. Corp. v. Twombly, 550 U.S. 554, 555 (2007). The allegations in the 

complaint must “contain sufficient factual matter, accepted as true, to ‘state a claim to 

relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing 

Twombly, 550 U.S. at 570). 

Well-pleaded allegations in the complaint are assumed true, but a court is not 

required to accept legal conclusions couched as facts, unwarranted deductions, or 

unreasonable inferences. Papasan v. Allain, 478 U.S. 265, 286 (1986); Sprewell v. 

Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001).

Leave to amend should be freely granted when justice so requires. See Fed. R. 

Civ. P. 15(a). However, denial of leave to amend is appropriate when such leave would 

be futile. See Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 339 (9th Cir. 1996); Plumeau 

v. Sch. Dist. No. 40 Cty. of Yamhill, 130 F.3d 432, 439 (9th Cir. 1997). 

III. REQUEST FOR JUDICIAL NOTICE

Defendant Stericycle Inc. requests judicial notice of the fact that “Stericycle is not 

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 3 of 8
4

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

an automobile manufacturer, and is not the manufacturer of the subject vehicle, a Jeep 

Grand Cherokee.” (P&A [Doc. 7-1] 4:10–12.) In support of this request, Stericycle also 

seeks judicial notice of a document printed from its website that describes its business. 

(See RJN [Doc. 7-3] 2:2–5, Ex. A.) Stericycle contends the fact—the type of business in 

which it is involved—is “a matter of common knowledge within this Court’s territorial 

region,” and is “readily ascertainable through its website.” (P&A 4:10–14.) 

Federal Rule of Civil Procedure 201 permits a court to take judicial notice of an 

adjudicative fact if it is “not subject to reasonable dispute.” Fed. R. Evid. 201(b). A fact 

is “not subject to reasonable dispute” if it is “generally known,” or “can be accurately and 

readily determined from sources whose accuracy cannot reasonably be questioned.” Id. 

201(b)(1)-(2). Under this rule, a court may “take judicial notice of matters of public 

record without converting a motion to dismiss into a motion for summary judgment,” but 

it “cannot take judicial notice of disputed facts contained in such public records.” Khoja 

v. Orexigen Therapeutics, Inc., 899 F.3d 988, 999 (9th Cir. 2018).

Here, Stericycle has not cited cases that are analogous to this case. None of

Stericycle’s cases took judicial notice of a party’s website in order to establish the type of 

business in which it was involved. In contrast, numerous cases have denied judicial 

notice of a party’s documents because they are not a source “whose accuracy cannot

reasonably be questioned.” Fed. R. Evid. 201(b)(2). In Victaulic Col. v. Tieman, 499 

F.3d 227 (3rd Cir. 2007), the Third Circuit explained why judicial notice of documents 

on a defendant’s website is not appropriate:

... a company's website is a marketing tool. Often, marketing material is full 

of imprecise puffery that no one should take at face value. Cf. Castrol, Inc. 

v. Pennzoil Co., 987 F.2d 939, 945 (3d Cir.1993) (distinguishing between 

mere puffery and actual misrepresentations). Thus courts should be wary of 

finding judicially noticeable facts amongst all the fluff; private corporate 

websites, particularly when describing their own business, generally are not 

the sorts of “sources whose accuracy cannot reasonably be questioned,” 

Fed.R.Evid. 201(b), that our judicial notice rule contemplates.

Id. at 236; see also Ladore v. Sony Computer Entertainment America, LLC, 75 F.Supp.3d 

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 4 of 8
5

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1065, 1074 (N.D. Cal. 2014) (refused to take judicial notice of defendant Sony Computer 

Entertainment America, LLC’s Terms of Service and/or Software Licenses because 

documents not the type whose “accuracy cannot be reasonably questioned.”); Ibey v. 

Taco Bell Corp., 2012 WL 2401972, * 1 (S.D.Cal. 2012) (LinkedIn page and Mobil 

Marketing Association U.S. Consumer Best Practices are not documents sources whose 

accuracy cannot be reasonably questioned).

Additionally, Stericycle has not provided authority for the proposition that its

business is a matter of “common knowledge” within this district. For these reasons, the 

Court will deny Stericycle’s request for judicial notice. 

IV. DISCUSSION

A. Because the Complaint alleges that Stericycle is a “manufacturer” of the 

vehicle, the Song-Beverly Act causes of action are properly pled.

Stericycle argues the first six causes of action for violation of the Song-Beverly 

Act must be dismissed because Stericycle is not a “manufacturer” of Plaintiff’s vehicle. 

(P&A 4:21–6:5.) This argument is dependent on Stericycle’s unsuccessful request for 

judicial notice. Because the Complaint alleges that Stericycle is a manufacturer (Compl.

¶ 4), Plaintiff has sufficiently alleged causes of action for violation of the Song-Beverly 

Act against Stericycle.

B. Plaintiff’s tort claims are barred by the economic-loss rule.

Defendant FCA argues that Plaintiff’s tort-based causes of action (six through 11) 

are barred by California’s economic-loss rule. (FCA’s P&A 3:9–6:19.) The Court 

agrees.

The economic loss rule provides that “where a purchaser’s expectations in a sale 

are frustrated, because the product he bought is not working properly, his remedy is said 

to be in contract alone, for he has suffered only ‘economic loss.’” Robinson Helicopter 

Co., Inc. v Dana Corp., 34 Cal.4th 979 (2004) (citation omitted). The rule has been 

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 5 of 8
6

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

“applied to bar a plaintiff’s tort recovery of economic damages unless such damages are 

accompanied by some form of physical harm (i.e., personal injury or property damage).” 

North American Chemical Co. v. Superior Court, 59 Cal.App.4th 764, 777 (1997). Thus, 

“in actions arising from the sale or purchase of a defective product, plaintiffs seeking 

economic losses must be able to demonstrate that either physical damage to property 

(other than the defective product itself) or personal injury accompanied such losses; if 

they cannot, then they would be precluded from any tort recovery in strict liability or 

negligence.” Ladore v. Sony Computer Entertainment America, LLC, 75 F.Supp.3d 

1065, 1075 (N.D. Cal. 2014) (quoting North American Chemical Co., 59 Cal.App.4th at 

780.) 

Here, the Complaint does not allege that Plaintiff suffered physical injury or that 

there was any physical damage to property other than the subject vehicle. Thus, his tort 

causes of action are barred by the economic loss rule.

Plaintiff nevertheless argues the economic loss rule does not apply because of an 

exception established in Robinson Helicopter Co., Inc. v Dana Corp., 34 Cal.4th 979 

(2004). (See Opp’n [Doc. 12] 9:11–10:3.) In Robinson, 34 Cal.4th 979, plaintiff 

purchased sprag clutches from defendant that were used in the manufacture of 

helicopters. The clutches were ground to a specified hardness that was approved by the 

Federal Aviation Administration (FAA) and could not be altered without FAA approval. 

With each shipment of clutches, the defendant provided plaintiff with a written 

certification that the clutches conformed to plaintiff’s written specifications. At some 

point, however, defendant changed the level of hardness without notifying plaintiff and 

the new clutches experienced a significantly higher failure rate. When defendant finally 

disclosed the change, the FAA required plaintiff to recall and replace the clutches at a 

cost exceeding $1.5 million. Plaintiff then sued defendant for breach of contract, breach 

of warranty and negligent and intentional misrepresentations. The jury found in favor of 

plaintiff on all causes of action and awarded $1,555,924 in compensatory damages and 

$6 million in punitive damages. 

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 6 of 8
7

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

On appeal, defendant argued plaintiff’s tort claims were barred by the economic 

loss rule. The California Supreme Court rejected the argument and held the rule did not 

bar plaintiff’s “fraud and intentional misrepresentation claims because they were 

independent of [defendant’s] breach of contract.” Id. at 991. Focusing on defendant’s 

issuance of the false certificates of conformance, the Court reasoned that defendant 

unquestionably made affirmative misrepresentations that [plaintiffs] 

justifiably relied on to its detriment. But for [defendant’s] affirmative 

misrepresentations by supplying the false certificates of conformance, 

[plaintiff] would not have accepted delivery and used the nonconforming 

clutches over the course of several years, nor would it have incurred the cost 

of investigating the cause of the faulty clutches. Accordingly, [defendant’s] 

tortious conduct was separate from the breach itself, which involved 

[defendant’s] provision of the nonconformant clutches. In addition, 

[defendant’s] provision of faulty clutches exposed [plaintiff] to liability for 

personal damages if a helicopter crashed and to disciplinary action by the 

F.A.A. Thus, [defendant’s] fraud is a tort independent of the breach.

Id. The Court emphasized, however, that its “holding today is narrow in scope and 

limited to a defendant’s affirmative misrepresentations on which a plaintiff relies and 

which expose a plaintiff to liability for personal damages independent of the plaintiff’s 

economic loss.” Id. at 993.

Plaintiff’s tort claims do not fit within the narrow exception established in

Robinson. To begin with, Plaintiff’s claims are based exclusively on omissions, not 

affirmative misrepresentations. (See Opp’n 1:27–2:1, 3:22–26, 5:7, 5:25–26, 7:1–8, 

7:11–21.) This alone precludes the exception. 

Additionally, the Complaint fails to plead a tort based on conduct independent of 

the breach of contract / warranty. In Robinson, the misrepresentation was based on 

defendant’s provision of the false certificates of conformance, not the breach of the 

parties’ contract. Here, all of Plaintiff’s tort claims are based on Defendants’ failure to 

fix Plaintiff’s vehicle as required by the warranty.

Plaintiff’s damages are also exclusively economic. While he argues the safety 

risks he was exposed to amount to personal injuries, he does not identify any actual harm 

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 7 of 8
8

19-cv-01691 W (AHG)

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

suffered as a result of the risks. In contrast, the plaintiff in Robinson incurred actual 

harm, including the cost of investigating the cause of the faulty clutches, the recall 

expenses, and replacement of the recalled clutches. 

Plaintiff also contends he should be given leave to amend to the extent the 

Complaint’s allegations are simply unclear. (Opp’n 10:6–12.) But his allegations are not 

unclear. Rather, the facts alleged in the Complaint establish that the economic loss rule 

bars his tort claims.

As emphasized throughout his opposition, this lawsuit involves alleged omissions, 

not affirmative misrepresentations. This alone precludes Plaintiff’s ability to avoid the 

economic loss rule. Nor is the Complaint vague about Plaintiff’s damages, which are 

strictly economic, or the basis for the proposed tort claims, which arise from the same 

conduct constituting the breach of contract / warranty. For these reasons, leave to amend 

is not warranted.

V. CONCLUSION AND ORDER

For the reasons stated below, the Court DENIES IN PART and GRANTS IN 

PART Defendant Stericycle, Inc.’s motion [Doc. 7] and GRANTS Defendant FCA US 

LLC’s’ motion [Doc. 8] WITHOUT LEAVE TO AMEND. The tort-based causes of 

action (seven through eleven) set forth in the Complaint are DISMISSED.

IT IS SO ORDERED. 

Dated: February 20, 2020

Case 3:19-cv-01691-W-AHG Document 21 Filed 02/20/20 PageID.<pageID> Page 8 of 8