Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-01252/USCOURTS-cand-3_06-cv-01252-12/pdf.json

Nature of Suit Code: 195
Nature of Suit: Contract Product Liability
Cause of Action: 15:2301 Magnuson-Moss Warranty Act

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United SFor thtates District e Northern District of CaCourt lifornia

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28 Pursuant to the Court’s briefing schedule on the motion, Plaintiff’s reply brief 1

was due on January 26, 2007. Plaintiff filed a reply on January 31, 2007, and explains that he

overlooked the Court’s Briefing Schedule, which superseded the time for filing a reply under

the Local Rules. The Court shall accept the late filing.

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

WILLIAM ZABIT,

Plaintiff,

 v.

PETERSON POWER SYSTEMS/CAT, et al.

Defendants.

 /

No. C 06-01252 JSW

ORDER DENYING PLAINTIFF’S

MOTION TO DISMISS

COUNTERCLAIMS

INTRODUCTION

This matter comes before the Court upon consideration of the motions to dismiss under

Federal Rule of Civil Procedure 12(b)(6) filed by Plaintiff William Zabit (“Zabit”). Having

considered the parties’ pleadings, and relevant legal authority, the Court finds the matter

suitable for disposition without oral argument. See N.D. Civ. L.R. 7-1(b). The Court 1

HEREBY DENIES the motion. The hearing set for February 23, 2007 on the motion is

VACATED and the case management conference shall be heard on the Court’s normal case

management calendar on Friday, February 23, 2007 at 1:30 p.m.

BACKGROUND

The Court has previously set forth the facts underlying this dispute and shall not repeat

them in detail in this Order. (See Docket Nos. 71, 72.) In brief, Zabit alleges claims for breach

of warranty under the Magnusson-Moss Warranty Act and for fraudulent concealment against

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Peterson Power Systems/CAT (“Peterson”) and Caterpillar, Inc. (“Caterpillar”) (collectively

“Defendants”) stemming from allegedly defective engines in a yacht that Zabit purchased in

April 2000.

Caterpillar and Peterson assert that Zabit has released them from any claims with respect

to the engines, based upon a release Zabit signed on March 2, 2005 (the “General Release”). 

Caterpillar and Peterson have filed counterclaims against Zabit alleging breach of the General

Release and fraud. Defendants’ fraud claim is based upon their contention that Zabit

misrepresented his intention to release them from any claims relating to the engines, when he

signed the General Release. (See Counterclaim ¶¶ 23-24.)

ANALYSIS

A. Legal Standards on Motions to Dismiss.

A motion to dismiss is proper under Rule 12(b)(6) where the pleadings fail to state a

claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). A motion to dismiss should

not be granted unless it appears beyond a doubt that a plaintiff can show no set of facts

supporting his or her claim. Conley v. Gibson, 355 U.S. 41, 45-46 (1957); see also De La Cruz

v. Tormey, 582 F.2d 45, 48 (9 Cir. 1978). In ruling on a Rule 12(b)(6) motion, the complaint is th

construed in the light most favorable to the non-moving party and all material allegations in the

complaint are taken to be true. Sanders v. Kennedy, 794 F.2d 478, 481 (9 Cir. 1986). The th

court, however, is not required to accept legal conclusions cast in the form of factual allegations

if those conclusions cannot reasonably be drawn from the facts alleged. Clegg v. Cult

Awareness Network, 18 F.3d 752, 754-55 (9 Cir. 1994) (citing Papasan v. Allain, 478 U.S. th

265, 286 (1986)). 

As a general rule, “a district court may not consider any material beyond the pleadings in

ruling on a Rule 12(b)(6) motion.” Branch v. Tunnell, 14 F.3d 449, 453 (9 Cir. 1994), th

overruled on other grounds, Galbraith v. County of Santa Clara, 307 F.3d 1119, 1125 (9 Cir. th

2002) (citation omitted). However, a district court may consider documents attached to a

plaintiff's complaint without converting a motion to dismiss into a motion for summary

judgment. Hal Roach Studios, Inc. v. Richmond & Feiner Co., Inc., 896 F.2d 1542, 1555 n.19

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(9 Cir. 1989). Similarly, a court may consider documents referenced in but not attached to a th

complaint, where no party questions their authenticity, without converting a motion to dismiss

into a motion for summary judgment. Branch, 14 F.3d at 453-54.

Zabit has submitted a copy of the General Release and a copy of Caterpillar’s Warranty. 

Defendants have not disputed the authenticity of these documents and have not objected to their

submission. Because the counterclaims reference the General Release, the Court may consider

it in ruling on the motion to dismiss. The Caterpillar Warranty is not necessary to the resolution

of this motion.

B. The Motion to Dismiss Shall Be Denied.

To state a claim for breach of contract, Defendants must allege: (1) the existence of a

contract; (2) that they performed or had an excuse for not-performing under the contract; (3) that

Zabit breached the contract; and (4) that they were damaged. See, e.g., First Commercial

Mortgage Co. v. Reece, 89 Cal. App. 4 731, 745 (2001). The counterclaim alleges facts th

supporting these elements. Indeed, Zabit’s arguments in favor of dismissal address the merits of

the breach of contract counterclaim and the issue of whether the General Release is valid. That

is a question addressed more appropriately on a motion for summary judgment. Accordingly,

the motion to dismiss the counterclaim for breach of contract is DENIED.

To state a claim for fraud, Defendants must allege: (1) Zabit made a false representation;

(2) Zabit knew the representation was false; (3) Zabit intended to induce Defendants’ reliance

on the misrepresentation; (4) Defendants justifiably relied on the misrepresentation; and (5)

Defendants were damaged. See, e.g. Crocker-Citizens Nat’l Bank v. Control Metals Corp., 566

F.2d 631, 636-37 (9 Cir. 1977); Engalla v. Permanente Medical Group, 15 Cal. 4 951, 974 th th

(1997). Defendants have set forth sufficient facts, which if taken as true, could state a claim for

fraud, and Zabit’s arguments in opposition to the motion go to whether Defendants will

ultimately be able to prove their claim. Accordingly, the motion to dismiss the fraud claim is

DENIED.

//

//

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CONCLUSION

For the reasons set forth above, Zabit’s motion to dismiss is DENIED.

IT IS SO ORDERED.

Dated: February 1, 2007 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

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