Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_08-cv-00618/USCOURTS-caed-1_08-cv-00618-1/pdf.json

Nature of Suit Code: 385
Nature of Suit: Property Damage - Product Liabilty
Cause of Action: 

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Plaintiffs are Tom Avinelis, Karen Avinelis, Lynn Shafer and Salley Shafer and will be referred to 1

collectively as “plaintiffs.”

1

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

TOM AVINELIS, et al., CASE NO. CV F 08-0618 LJO SMS

Plaintiff, ORDER ON DEFENDANT’S MOTION TO

DISMISS AMENDED BREACH OF

vs. WARRANTY CLAIM

(Doc. 31.)

BASF CORPORATION,

Defendant.

 /

INTRODUCTION

Defendant BASF Corporation (“BASF”) seeks to dismiss plaintiffs’ amended claim that BASF 1

breached its written warranties for its fungicides which allegedly damaged plaintiffs’ blueberry crop and

destroyed plaintiffs’ blueberry bushes. Plaintiffs contend that their amended breach of written warranty

claim is viable in that it alleges that the fungicides’ labels affirmed that the fungicides were safe to use

on blueberry plants. This Court considered BASF’s F.R.Civ.P. 12(b)(6) motion to dismiss on the record

and VACATES the September 9, 2008 hearing, pursuant to this Court’s Local Rule 78-230(h). For the

reasons discussed below, this Court DISMISSES with prejudice plaintiffs’ breach of written warranty

claim.

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BACKGROUND

BASF’s Warranty Disclaimers

BASF manufactures and distributes agricultural fungicides, including Pristine and Cabrio, which

controls fungus on blueberries. Plaintiffs are partners in Tulare County farming operations. In March

2007, plaintiffs applied Pristine and Cabrio to their blueberry fields and claim damage and destruction

to their blueberry bushes and production loss.

The Pristine and Cabrio labels include specific restrictions, limitations and recommendations for

their applications to specific crops, including blueberries. The label of Pristine includes a “Conditions

of Sale and Warranty” section which provides in pertinent part:

Crop injury, ineffectiveness or other unintended consequences may result because of

such factors as weather conditions, presence of other materials, or use of the product in

a manner inconsistent with its labeling, all of which are beyond the control of BASF

CORPORATION (“BASF”) or the Seller. All such risks shall be assumed by the Buyer.

BASF warrants that this product conforms to the chemical description on the label and

is reasonably fit for the purposes referred to in the Directions for Use, subject to the

inherent risks, referred to above. BASF MAKES NO OTHER EXPRESS OR IMPLIED

WARRANTY OF FITNESS OR MERCHANTABILITY OR ANY OTHER EXPRESS

OR IMPLIED WARRANTY. TO THE EXTENT PERMITTED BY LAW, BASF AND

THE SELLER DISCLAIM ANY LIABILITY FOR CONSEQUENTIAL, SPECIAL OR

INDIRECT DAMAGES RESULTING FROM THE USE OR HANDLING OF THIS

PRODUCT. (Bold and uppercase in original.)

The label of Cabrio includes a “Conditions of Sale and Warranty” section which includes near

identical language and provides in pertinent part:

Crop injury, ineffectiveness or other unintended consequences may result because of

such factors as weather conditions, presence of other materials, or use of the product in

a manner inconsistent with its labeling, all of which are beyond the control of BASF

CORPORATION (“BASF”) or the Seller. All such risks shall be assumed by the Buyer.

BASF warrants that this product conforms to the chemical description on the label and

is reasonably fit for the purposes referred to in the Directions for Use, subject to the

inherent risks, referred to above. BASF MAKES NO OTHER EXPRESS OR IMPLIED

WARRANTY OF FITNESS OR MERCHANTABILITY OR ANY OTHER EXPRESS

OR IMPLIED WARRANTY. IN NO CASE SHALL BASF OR THE SELLER BE

LIABLE FOR CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES

RESULTING FROM THE USE OR HANDLING OF THIS PRODUCT. (Bold and

uppercase in original.)

Plaintiffs’ Amended Breach Of Written Warranty Claim

This Court’s June 30, 2008 order dismissed, with leave to amend, plaintiffs’ original breach of

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written warranty claim on grounds that the Pristine and Cabrio limited warranties did not cover

plaintiffs’ alleged crop injury and that the warranties disclaimed consequential damages sought by the

claim. Plaintiffs proceed on their first amended complaint (“FAC”) to allege that Pristine and/or Cabrio

was ““defective and unsafe for its intended purposes in that it caused damage to the blueberry fields and

prevented them from properly pollinating, and caused defective growth in the blueberries, thereby

decreasing size of each fruit, and the quantity of production.” BASF challenges the complaint’s (fourth)

breach of written warranty cause of action that BASF breached the written warranties of Pristine and

Cabrio’s labels that “those products conformed to their respective labels, chemical description, and were

reasonably fit for the purposes referred to in the Directions for Use” to result in “damage and destruction

to the blueberry bushes.” The cause of action further alleges:

The plaintiffs . . . relied upon these representations that the field use and tests had

been performed on blueberry bushes when they purchased and applied the product now.

. . . [D]efendant mis-represented that field tests were performed on blueberry bushes, and

sold these two products without performing tests, or adequate tests on blueberries.

Thereby, fostering unsafe use of the defendant’s products, which is oppressive and

unconscionable behavior and in disregard of the legal rights and property rights of the

plaintiffs . . . and as such pursuant to California Commercial Code section 2719(3) the

plaintiff’s [sic] damages should include all consequential damages.

The cause of action claims damages in excess of $33 million “to replace the damaged and destroyed

blueberry bushes.”

DISCUSSION

F.R.Civ.P. 12(b)(6) Standards

BASF seeks F.R.Civ.P. 12(b)(6) dismissal of plaintiffs’ (fourth) breach of written warranty cause

of action. A F.R.Civ.P. 12(b)(6) motion to dismiss is a challenge to the sufficiency of the pleadings set

forth in the complaint. “When a federal court reviews the sufficiency of a complaint, before the reception

of any evidence either by affidavit or admissions, its task is necessarily a limited one. The issue is not

whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to

support the claims.” Scheurer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683 (1974); Gilligan v. Jamco

Development Corp., 108 F.3d 246, 249 (9 Cir. 1997). A F.R.Civ.P. 12(b)(6) dismissal is proper where

th

there is either a “lack of a cognizable legal theory” or “the absence of sufficient facts alleged under a

cognizable legal theory.” Balisteri v. Pacifica Police Dept., 901 F.2d 696, 699 (9 Cir. 1990); Graehling th

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v. Village of Lombard, Ill., 58 F.3d 295, 297 (7 Cir. 1995). F.R.Civ.P. 12(b)(6) dismissal is proper th

when “plaintiff can prove no set of facts in support of his claim which would entitle him to relief.”

Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102 (1957). 

In resolving a Rule 12(b)(6) motion, the court must: (1) construe the complaint in the light most

favorable to the plaintiff; (2) accept all well-pleaded factual allegations as true; and (3) determine

whether plaintiff can prove any set of facts to support a claim that would merit relief. Cahill v. Liberty

Mut. Ins. Co., 80 F.3d 336, 337-338 (9th Cir. 1996). Nonetheless, a court is “free to ignore legal

conclusions, unsupported conclusions, unwarranted inferences and sweeping legal conclusions cast in

the form of factual allegations.” Farm Credit Services v. American State Bank, 339 F.3d 765, 767 (8

th

Cir. 2003) (citation omitted). A court need not permit an attempt to amend a complaint if “it determines

that the pleading could not possibly be cured by allegation of other facts.” Cook, Perkiss and Liehe, Inc.

v. N. Cal. Collection Serv. Inc., 911 F.2d 242, 247 (9 Cir. 1990). “While a complaint attacked by a th

Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff’s obligation to

provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and conclusions, and a

formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 127

S. Ct. 1955, 1964-65 (2007) (internal citations omitted).

In a F.R.Civ.P. 12(b)(6) motion, a court generally cannot consider material outside the complaint.

Van Winkle v. Allstate Ins. Co., 290 F.Supp.2d 1158, 1162, n. 2 (C.D. Cal. 2003). Nonetheless, a court

may consider exhibits submitted with the complaint. Van Winkle, 290 F.Supp.2d at 1162, n. 2 A court

may also consider “documents ‘whose contents are alleged in a complaint and whose authenticity no

party questions, but which are not physically attached to the [plaintiff’s] pleading.’” Parrino v. FHP,

Inc., 146 F.3d 699, 705 (9 Cir. 1998) (quoting Branch v. Tunnell, 14 F.3d 449, 454 (9 Cir. 1994)). th th

As such, this Court may consider the Pristine and Cabrio labels attached to plaintiffs’ complaint.

Scope Of Pristine And Cabrio Warranties

BASF contends that the (fourth) breach of written warranty cause of action alleges a breach, and

seeks damages, beyond the scope of Pristine and Cabrio’s warranties which are limited to conformance

with the chemical descriptions on their labels and effectiveness to control fungus. BASF contests

plaintiffs’ allegation that the Pristine and Cabrio labels warranted that Pristine and Cabrio are safe for

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blueberries. BASF argues that the labels did not warrant against crop injury and emphasizes that the

Pristine and Cabrio labels warn:

However, it is impossible to eliminate all risks inherently associated with use of

this product. Crop injury, ineffectiveness or other unintended consequences may result

because of such factors as weather conditions, presence of other materials, or use of the

product in a manner inconsistent with its labeling, all of which are beyond the control of

BASF CORPORATION (“BASF”) or the Seller. All such risks shall be assumed by the

Buyer.

BASF notes that the cause of action fails to allege that Pristine and Cabrio did not conform to their

labels’ chemical description, were ineffective to prevent fungus or were unsafe for blueberries. 

Under California Commercial Code section 2313(1), a seller creates an express warranty by:

(a) Any affirmation of fact or promise made by the seller to the buyer which relates to the

goods and becomes part of the basis of the bargain creates an express warranty that the

goods shall conform to the affirmation or promise.

(b) Any description of the goods which is made part of the basis of the bargain creates

an express warranty that the goods shall conform to the description.

“[T]o plead a cause of action for breach of express warranty, one must allege the exact terms of the

warranty, plaintiff's reasonable reliance thereon, and a breach of that warranty which proximately causes

plaintiff injury.” Williams v. Beechnut Nutrition Corp., 185 Cal.App.3d 135, 142, 229 Cal.Rptr. 605

(1986); see Burr v. Sherwin Williams Co., 42 Cal.2d 682, 268 P.2d 1041 (1954); Cal.Com.Code, § 2313.

There is no question that BASF made express warranties and that plaintiffs plead breach of

warranty. The issue is the scope of BASF’s warranties and the extent to which they have been

disclaimed.

BASF relies on Buckley v. Shell Chemical Co., 32 Cal.App.2d 209, 89 P.2d 453 (1939), where

plaintiffs pursued breach of warranty claims that application of a fertilizer resulted in a lesser quantity

and quality potato crop. Since the sales order contained a disclaimerfor crop productiveness and quality,

“this disclaimer of warranties in writing must be controlling here and defendants cannot be held liable

because of poor quality of the crop.” Buckley, 32 Cal.App.2d at 214, 89 P.2d 453; see Mosesian v.

Bagdasarian, 260 Cal.App.2d 361, 365-366, 67 Cal.Rptr. 369 (1968) (express disclaimer of warranty

appearing on labels of drums containing liquid insecticide was sufficient notice that defendant did not

warrant or guarantee quality, use, control or results to be expected from product).

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BASF correctly notesthat the (fourth) breach of written warranty cause of action does not allege

that Cabrio and Pristine are unsafe or are not to be used on blueberries and that the cause of action’s

essence is that plaintiffs’ blueberry bushes were injured after use of Pristine and Cabrio. Plaintiffs claim

that the Cabrio and Pristine labels “provided an affirmation that the products were safe to use on

blueberries.”

BASF made limited warranties that Pristine and Cabrio will conform to their respective labels’

chemical description and are reasonably fit for the purposes referred to in Directions for Use. BASF did

not warrant against crop injury or guarantee successful crops. Plaintiffs’ newfound allegations of

blueberry bush destruction are unavailing. Plaintiffs wrongly attempt to ignore the labels’ limitations

and to expand the labels to warrant no crop damage. BASF is not subject to upholding a warranty it did

not make.

Consequential Damages

BASF notes that the (fourth) breach of written warranty cause of action seeks consequential

damages for damage and destruction of plaintiffs’ blueberry bushes caused by Pristine and Cabrio.

California Commercial Code section 2715(2)(b) defines consequential damages to include “[i]njury to

person or property proximately resulting from any breach of warranty.” BASF argues that plaintiffs’

alleged damages fit “squarely within the definition of consequential damages under the Commercial

Code” and that the Pristine and Cabrio labels expressly disclaim liability for such consequential

damages. As a reminder, the Pristine label states that “BASF AND THE SELLER DISCLAIM ANY

LIABILITY FOR CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES RESULTING FROM

THE USE OR HANDLINGOFTHIS PRODUCT.” (Uppercase in original.) TheCabrio label provides:

“IN NO CASE SHALL BASF OR THE SELLER BE LIABLE FOR CONSEQUENTIAL, SPECIAL

OR INDIRECT DAMAGES RESULTING FROM THE USE OR HANDLING OF THIS PRODUCT.”

To attempt to invalidate the disclaimers, the (fourth) breach of written warranty cause of action

references BASF’s testing conduct as “unconscionable.” California Commercial Code section 2719(3)

provides: 

Consequential damages may be limited or excluded unless the limitation or

exclusion is unconscionable. . . . Limitation of consequential damages where the loss is

commercial is valid unless it is proved that the limitation is unconscionable. 

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BASF notes that the Pristine and Cabrio labels “do not indicate that any specific testing has been done

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regarding these products.”

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 BASF identifies the “critical issue” as whether the disclaimers on the Pristine and Cabrio labels

are unconscionable, not BASF’s conduct to test Pristine and Cabrio – an irrelevant issue. BASF points

to the absence of “facts that would support any claim that the consequential damages disclaimer is

unconscionable.” BASF argues that as buyers in commercial transactions, plaintiffs bear the burden to

show that the Pristine and Cabrio disclaimers are unconscionable. 

Plaintiffs rely on the following language from the Pristine and Cabrio labels: “The Directions

of Use of this product reflect the opinion of experts based on field use and tests.” Plaintiffs contend that

BASF misrepresented that field tests were performed on blueberry bushes, sold Pristine and Cabrio 2

without adequate tests on blueberries, and fostered unsafe use of Pristine and Cabrio to constitute

“oppressive and unconscionable behavior.” Plaintiffs continue that the misrepresentations

“unreasonably shifted the risk of damages based on false information” to avoid limitation on

consequential damages. 

“[U]nconscionability has generally been recognized to include an absence of meaningful choice

on the part of one of the parties together with contract terms which are unreasonably favorable to the

other party.” Nunes Turfgrass, Inc. v. Vaughan-Jacklin Seed Co., 200 Cal.App.3d 1518, 1534, 246

Cal.Rptr. 823 (1988). “Under Cal.Com.Code § 2719(3), the burden of demonstrating unconscionability

of a provision limiting remedies lies with the Plaintiff. Mere inconspicuousness is not sufficient to

establish unconscionability under § 2719(3).” AMF Inc. v. Computer Animation, Inc., 573 F.Supp. 924,

930, (S.D. Ohio 1983) (in applying California law, the court found that plaintiff “has not proffered the

sort of facts which might demonstrate that it lacked a ‘meaningful choice’”). 

Unconscionability has substantive and procedural elements. See American Software, Inc. v. Ali,

46 Cal.App.4th 1386, 1391, 54 Cal.Rptr.2d 477 (1996). “Substantive unconscionability focuses on the

actual terms for the agreement, while procedural unconscionability focuses on the manner in which the

contract was negotiated and the circumstances of the parties.” American Software, 46 Cal.App.4th at

1391, 54 Cal.Rptr.2d 477. The general requirement is “a showing of both substantive and procedural

unconscionability at the time the contract is made.” American Software, 46 Cal.App.4th at 1391, 54

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Cal.Rptr.2d 477.

Indication of procedural unconscionability includes “oppression, arising from inequality of

bargaining power and the absence of real negotiation or a meaningful choice” and “surprise, resulting

from hiding the disputed term in a prolix document.” Vance v. Villa Park Mobilehome Estates, 36 Cal.

App.4th 698, 709, 42 Cal.Rptr.2d 723 (1995). Substantive unconscionability arises from contract terms

so one-sided as to “shock the conscience.” California Grocers Assn. v. Bank of America, 22

Cal.App.4th 205, 214, 27 Cal.Rptr.2d 396 (1994) (italics in original). The California Court of Appeal

has explained further:

With a concept as nebulous as “unconscionability” it is important that courts not be

thrust in the paternalistic role of intervening to change contractual terms that the parties

have agreed to merely because the court believes the terms are unreasonable. The terms

must shock the conscience.

The critical juncture for determining whether a contract is unconscionable is the

moment when it is entered into by both parties-not whether it is unconscionable in light

of subsequent events. (Civ. Code, § 1670.5.) Unconscionability is ultimately a question

of law for the court.

American Software, 46 Cal.App.4th at 1392, 54 Cal.Rptr.2d 477.

Plaintiffs confuse the unconscionability issue. The (fourth) breach of written warranty cause of

action claims that BASF’s testing and related representations fostered “unsafe use of defendant’s

products, which is oppressive and unconscionable.” Such claim is irrelevant to absence of plaintiffs’

meaningful choice to unreasonably favor BASF. Plaintiffs paint themselves as unequal bargainers

“restricted to the terms of the warranty.” Plaintiffs fail to distinguish this from any other commercial

or agricultural transaction. Commercial entities, like plaintiffs and BASF, “are entitled to contract to

limit the liability of one to the other, or otherwise allocate the risk of doing business.” Philippine

Airlines, Inc. v. McDonnell Douglas Corp., 189 Cal.App.3d 234, 237, 234 Cal.Rptr. 423 (1987).

Plaintiffs were not forced to use Pristine orCabrio and as agriculture professionals were free to purchase

and use other fungicides. The cause of action fails to allege pertinent and sufficient facts to overcome

the Pristine and Cabrio disclaimers. This Court agrees with BASF’s contention that “there are no

additional facts that Plaintiffs could allege that would make their breach of warranty claim actionable.”

In sum, the Pristine and Cabrio labels sufficiently disclaim the consequential damages sought

by the (fourth) breach of warranty cause of action. In the absence of pertinent allegations of

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unconscionability, the cause of action fails, and an attempt at further amendment would be futile.

“Although there is a general rule that parties are allowed to amended their pleadings, it does not extend

to cases in which any amendment would be an exercise in futility . . ., or where the amended complaint

would also be subject to dismissal . . .” Steckman v. Hart Brewing, Inc., 143 F.3d 1293, 1298 (9 Cir. th

1998) (citations omitted).

CONCLUSION AND ORDER

For the reasons discussed above, this Court DISMISSES with prejudice the FAC’s (fourth) cause

of action for breach of written warranty. 

IT IS SO ORDERED.

Dated: September 3, 2008 /s/ Lawrence J. O'Neill 

66h44d UNITED STATES DISTRICT JUDGE

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