UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

IN RE: PORSCHE CARS NORTH Case No. 2:11-md-2233

AMERICA, INC. PLASTIC COOLANT

TUBES PRODUCTS LIABILITY 

LITIGATION JUDGE GREGORY L. FROST

Magistrate Judge E.A. Preston Deavers

This document relates to: ALL CASES.

OPINION AND ORDER

This matter is before the Court for consideration of Porsche Cars North America, Inc.’s

Motion to Dismiss the Master Consolidated Amended Class Action Complaint Pursuant to Fed.

R. Civ. P. 12(b)(6) (ECF No. 62), Plaintiffs’ Memorandum of Law in Opposition to Defendant

Porsche Cars North America, Inc.’s Motion to Dismiss the Master Consolidated Amended Class

Action Complaint Pursuant to Fed. R. Civ. P. 12(b)(6) (ECF No. 77), and Porsche Cars North

America, Inc.’s Reply Brief in Support of Its Motion to Dismiss the Master Consolidated

Amendment Class Action Complaint Pursuant to Fed. R. Civ. P. 12(b)(6) (ECF No. 91). For the

reasons that follow, the Court GRANTS IN PART and DENIES IN PART the motion to

dismiss. 

I. Background

The plaintiffs in this products liability action are purchasers of Porsche Cayenne,

Cayenne GTS, Cayenne S, Cayenne Turbo, or Cayenne Turbo S sport utility vehicles of the

model years 2003–2010 (“Cayenne”). Defendants are Porsche Cars North America, Inc.

(“PCNA”) and the German company Dr. Ing. h.c. F. Porsche Aktiengellschaft (“Porsche AG”)

(collectively, “Defendants”). Porsche AG manufactured the Cayenne and PCNA is the exclusive

1

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 1 of 131 PAGEID #: <pageID>
importer of Cayenne vehicles in the United States. 

On May 24, 2011, the United States Judicial Panel on Multidistrict Litigation (“the

Panel”) consolidated four related product liability actions involving the Cayenne (arising from

California, New Jersey, New York, and Ohio) in this Court pursuant to 28 U.S.C. § 1407. (ECF

No. 1.) The Panel subsequently transferred four related actions from Florida, Georgia,

California, and Texas to this Court. (ECF Nos. 3, 4, 11.) On August 25, 2011, the plaintiffs in

these eight actions, along with several new individual plaintiffs (collectively, “Plaintiffs”), filed

a Consolidated Amended Complaint (“Complaint”) with this Court alleging defects in the

Cayenne’s cooling system. (ECF No. 35.) Plaintiffs brought the Complaint on behalf of a

proposed nationwide class of similarly situated Cayenne owners and lessees and proposed subclasses of similarly situated Cayenne owners and lessees in California, Colorado, Florida,

Georgia, Illinois, Michigan, New Jersey, New York, Ohio, Texas, and Washington. 

Each individual plaintiff asserts that he or she purchased a Cayenne that came equipped

with plastic coolant tubes.1

 Plaintiffs assert that such tubes cracked, leaked, or otherwise failed

and that, in some cases, the tubes leaked and caused damage to other parts of the engine. When

Plaintiffs attempted to repair or replace the coolant tubes, they allegedly learned that Porsche did

not offer replacement plastic tubes but instead offered an “OEM update kit” that contained

1

The circumstances in which each individual plaintiff purchased his/her Cayenne vary. 

Plaintiffs Graas, Krider, Starkey, Dudley, Gardner, Florez, Hoffecker, Crawford, Stuewe, and

Wust plead only that they “purchased” or “owned” a Cayenne at all times relevant. Plaintiffs

Delgado and Gorospe purchased their Cayennes from a “used car dealer”; McIntosh purchased a

“previously-owned” Cayenne from an undisclosed seller; Bredefeld and Daher purchased their

Cayennes from a Suzuki and Ferrari dealer, respectively; and Spanoletti, Cadman, and Jackman

purchased certified pre-owned Cayennes from authorized Porsche dealers. Only Plaintiffs

Conrad and Tran purchased their vehicles new. (ECF No. 35 ¶¶ 72–232.) 

2

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 2 of 131 PAGEID #: <pageID>
aluminum coolant pipes and cost “at least $1,500 to $3,600 per vehicle” to purchase and install. 

(Id. ¶ 69.) 

Plaintiffs allege that Defendants defectively designed the Cayenne by equipping it with

plastic coolant tubes instead of aluminum pipes. Plaintiffs argue that the Cayenne’s coolant

system is defective because coolant tubes are exposed to extreme heat and that, as a result of

such exposure, coolant tubes made of plastic will crack and degrade. Plaintiffs add that “most

high-end performance vehicles with powerful engines use aluminum pipes to transport the

coolant” and that the “extent of wear and tear on the Cayenne’s plastic valley coolant tubes is

entirely disproportionate to the age of these vehicles.” (Id. ¶ 68(b).) Plaintiffs also allege that

the use of plastic coolant tubes “implicates serious safety concerns.” (Id. ¶ 70.) 

Plaintiffs assert that Defendants knew, reasonably should have known, or were reckless

in not knowing about the coolant tube defect but failed to disclose the defect to consumers. 

Defendants allegedly had or should have had this knowledge “based on, among other things,

widespread customer complaints of prematurely cracking coolant tubes, dealer inquiries, repair

shop inquiries, dealer-provided repair data, the high volume of replacement parts being ordered,

and [National Highway Traffic Safety Administration] complaints.” (Id. ¶ 63.) Plaintiffs assert

that, despite this alleged knowledge, Defendants promoted the Cayenne’s cooling system and

made misrepresentations such as “ ‘[t]he entire cooling system is specifically designed for

prolonged heavy-duty operation.’ ” (Id. ¶ 62(c).) 

Plaintiffs also attach to their Complaint a technical bulletin that PCNA issued in February

2008 stating that “[o]n [Model Year] 2003 to [Model Year] 2006 vehicles there is a chance that

the coolant pipes made from plastic may start to leak. . . . Both coolant pipes (lower and heater)

3

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 3 of 131 PAGEID #: <pageID>
must be replaced at the same times with new coolant pipes made from aluminum” as evidence

that Defendants acknowledged the defect. (ECF No. 35-1.) Plaintiffs note that, despite

acknowledging the defect, Defendants have not reimbursed Cayenne owners for the cost of

replacement parts or issued any type of recall. 

Plaintiffs plead a total of thirty-two claims for relief against Defendants, including one

federal statutory claim and thirty-one state statutory and common law claims. Plaintiffs seek

economic damages, an order enjoining Defendants from “continuing the unfair business

practices alleged in this Complaint,” and injunctive relief “in the form of a recall or free

replacement program.” (ECF No. 35, at 79.) Plaintiffs do not claim any damages for bodily

injury that the alleged coolant tube defect may have caused. 

PCNA filed a motion to dismiss the Complaint pursuant to Rule 12(b)(6) on January 6,

2012. (ECF No. 62.) That same day, Porsche AG filed a motion to dismiss pursuant to Rule

12(b)(2) (ECF No. 63) and a second motion to dismiss adopting PCNA’s Rule 12(b)(6)

arguments (ECF No. 64). The Court is holding Porsche AG’s Rule 12(b)(6) motion in abeyance

until it decides the personal jurisdiction issue regarding Porsche AG. (ECF No. 67.) Thus, the

Court now considers only PCNA’s motion to dismiss. 

 II. Rule 12(b)(6) Standard

 Dismissal under Rule 12(b)(6) is proper if a complaint fails to state a claim upon which a

court can grant relief. Fed. R. Civ. P. 12(b)(6). To survive a motion to dismiss, a complaint

must provide fair notice of what the claim is and the grounds upon which it rests, and it must set

forth sufficient factual allegations suggesting that the plaintiff is entitled to relief under those

claims. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007) (citing Conley v. Gibson, 355

4

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 4 of 131 PAGEID #: <pageID>
U.S. 41, 47 (1957)). A court, in ruling on a Rule 12(b)(6) motion, must construe the complaint

in the light most favorable to the plaintiff and treat all well-pleaded allegations contained therein

as true. Id. at 555–56. The defendant bears the burden of demonstrating that the plaintiff has

failed to state a claim for relief. Directv, Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir. 2007). 

Rule 8(a)(2) governs pleading standards and requires that a complaint contain a “short

and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P.

8(a)(2). Although Rule 8 does not require “detailed factual allegations,” “it does not unlock the

doors of discovery for a plaintiff armed with nothing more than conclusions.” Ashcroft v. Iqbal,

556 U.S. 662, 678–79 (2009). Thus, a court need not “accept as true a legal conclusion couched

as a factual allegation.” Twombly, 550 U.S. at 555 (citing Papasan v. Allain, 478 U.S. 265, 286

(1986)). A pleading that offers “labels and conclusions” or “a formulaic recitation of the

elements of a cause of action” will not suffice to defeat a Rule 12(b)(6) motion to dismiss. Id. 

In fact, “a court considering a motion to dismiss can choose to begin by identifying pleadings

that, because they are no more than conclusions, are not entitled to the assumption of truth.” 

Iqbal, 556 U.S. at 679. Once the court has identified the well-pleaded allegations, it should view

each allegation in the context of the entire complaint to determine whether a plaintiff has alleged

sufficient facts to support his or her claim. See In re Polyurethane Foam Antitrust Litig., 799 F.

Supp. 2d 777, 782 (N.D. Ohio 2011). 

Considering only those well-pleaded facts, a complaint must “state a claim to relief that

is plausible on its face.” Twombly, 550 U.S. at 570. “A claim has facial plausibility when the

plaintiff pleads factual content that allows the court to draw the reasonable inference that the

defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Twombly, 550

5

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 5 of 131 PAGEID #: <pageID>
U.S. at 556). A plaintiff’s factual allegations must be enough to raise the claimed right to relief

above the speculative level and to create a reasonable expectation that discovery will reveal

evidence to support the claim. Twombly, 550 U.S. at 556. If the “well-pleaded facts do not

permit the court to infer more than the mere possibility of misconduct,” the court should dismiss

the complaint. Iqbal, 556 U.S. at 679. 

Claims of fraud are subject to heightened pleading requirements. Fed. R. Civ. P. 9(b)

(“In alleging fraud or mistake, a party must state with particularity the circumstances constituting

fraud or mistake. Malice, intent, knowledge, or other conditions of a person’s mind may be

alleged generally.”). To satisfy Rule 9(b), a plaintiff must “allege the time, place, and content of

the alleged misrepresentation on which he or she relied; the fraudulent scheme; the fraudulent

intent of the defendants; and the injury resulting from the fraud.” Bennett v. MIS Corp., 607

F.3d 1076, 1100 (6th Cir. 2010). The rule requires that the circumstances of the fraud, and not

the evidence of the case, be pleaded with particularity. Michaels Bldg. Co. v. Ameritrust Co.,

N.A., 848 F.2d 674, 680 n.9 (6th Cir. 1988). Rule 9(b) may be relaxed when there has been a

lack of discovery and the information needed for a plaintiff to achieve particularity is held

exclusively by the opposing party—in other words, Rule 9(b) does not require a plaintiff to be

omniscient. Id. The main purpose behind Rule 9(b) is to provide the defendant with notice of

the plaintiff’s claim so that the defendant may prepare an informed responsive pleading. Id. at

679; Coffey v. Foamex, L.P., 2 F.3d 157, 162 (6th Cir. 1993).

In interpreting federal law, a transferee court in a multidistrict case should look to the law

of its own circuit rather than the law of the transferor courts’ circuits. In re Nat’l Century Fin.

Enters., Inc., Inv. Litig., 323 F. Supp. 2d 861, 876–77 (S.D. Ohio 2004) (citing In re Korean Air

6

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 6 of 131 PAGEID #: <pageID>
Lines Disaster of Sept. 1, 1983, 829 F.2d 1171, 1176 (D.C. Cir. 1987)); In re: Methyl Tertiary

Butyl Ether (“MTBE”) Prods. Liab. Litig., No. 00-1898, 2005 WL 106936, at *5 (S.D.N.Y. Jan.

18, 2005). Thus, although the parties have cited cases from various circuits discussing Rule

9(b)’s heightened pleading requirements, the Court will analyze federal procedural law in

accordance with Sixth Circuit precedent. 

The Court must decide substantive questions of state law “in accordance with the

controlling decisions of the highest court of the state.” Meridian Mut. Ins. Co. v. Kellman, 197

F.3d 1178, 1181 (6th Cir. 1999) (citing Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938)). If the

state’s highest court has not decided the issue, the Court must predict how that court would

resolve it by considering decisions of the state’s lower courts, other federal courts construing

state law, secondary sources, and applicable dicta of the state’s highest court. Id.; see also Welsh

v. Wachovia Corp., 191 F. App’x 345, 355–56 (6th Cir. 2006). A court should not disregard the

decisions of intermediate appellate state courts unless it is convinced by other persuasive data

that the highest court of the state would decide otherwise. West v. Am. Tel. & Tel. Co., 311 U.S.

223, 237 (1940) (stating that, when an intermediate appellate state court “rests its considered

judgment upon the rule of law which it announces,” such a rule is “datum for ascertaining state

law which is not to be disregarded by a federal court unless it is convinced by other persuasive

data that the highest court of the state would decide otherwise”); Meridian Mut. Ins. Co., 197

F.3d at 1181. 

III. Facts

A. Four-Year/50,000 Mile Warranty

PCNA attached to its motion to dismiss four written “Warranty and Customer

7

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 7 of 131 PAGEID #: <pageID>
Information” packets from the years 2003–2006 (“Warranties”) that Plaintiffs did not attach to

their Complaint. Each Warranty provides the following coverage:

[PCNA] will repair or replace with a new or remanufactured part distributed by

[PCNA], at its sole option, any factory-installed part that is defective in material or

workmanship under normal use. (Normal vehicle use is described in this Booklet.) 

Warranty repairs will be made free of charge for parts and labor at an authorized

Porsche automobile dealer . . . . 

(ECF No. 62-1, at 7; 62-3, at 7; 62-5, at 6; 62-7, at 7.)

Warranty coverage lasts for “four years, or 50,000 miles, whichever comes first”

(“Warranty Period”). (Id.) The Warranties also state that “[a]ny implied warranties, including

the implied warranties of merchantability and fitness for a particular purpose, are limited to the

duration of the written warranty.” (Id.) 

The Court will consider the Warranties as part of the Complaint without converting

PCNA’s motion to a summary judgement motion. The Sixth Circuit has stated that in ruling on a

Rule 12(b)(6) motion, a court may consider exhibits attached to the defendant’s motion to

dismiss if they are referenced in the complaint and are central to the claims contained therein. 

Bassett v. Nat’l Collegiate Athletic Ass’n, 528 F.3d 426, 30 (6th Cir. 2008); see also Greenberg

v. Life Ins. Co. of Va., 177 F.3d 507, 514 (6th Cir. 1999) (allowing a defendant to submit and the

court to consider a document that was not attached to the complaint but that was “central to the

plaintiff’s claim”). The Complaint references the 2003 Warranty and later states that

“[Defendants] made written and implied warranties regarding its Porsche Cayennes.” (ECF No.

35 ¶¶ 218, 247.) Plaintiffs argue that they sufficiently identified the Warranties in their

Complaint. (ECF No. 77, at 28.) Because Plaintiffs refer to the Warranties and because the

Warranties are undoubtedly central to this products liability action, the Court will consider the

8

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 8 of 131 PAGEID #: <pageID>
Warranties as part of the Complaint. See, e.g., Perko v. Ford Motor Co., No 10-514, 2011 WL

1769098, at *2 (N.D. Ohio May 9, 2011) (in a product liability action, considering a warranty

that the defendants attached to their motion to dismiss as part of the complaint). 

B. Claims

The Court begins by identifying those well-pleaded facts that are common to all twenty

Plaintiffs. Iqbal, 556 U.S. at 679. Many of the thirty-two claims turn on what PCNA allegedly

knew—and what it allegedly represented—and when. The Court will therefore examine the

factual support surrounding these allegations and isolate the well-pleaded facts on which the

Court may rely in analyzing Plaintiffs’ claims. 

 One of Plaintiffs’ overarching allegations is that PCNA knew or was reckless in not

knowing of the alleged defect and that it concealed this knowledge from consumers. To support

this allegation, Plaintiffs allege that PCNA received “many complaints from Cayenne owners

and lessees concerning failure of the tubes since the U.S. commercial launch of the Cayenne in

2003,” “had access to aggregate data from [their] dealers regarding the coolant tubes,” “had

access to pre- and post-release testing data,” and “had access to complaints made to [them and

their] dealers regarding the coolant tubes.” (ECF No. 35 ¶¶ 59, 61.) Plaintiffs also allege that

“most high-end performance vehicles with powerful engines use aluminum pipes to transport the

coolant,” that “[a]luminum pipes have been proven to withstand the extreme temperatures of the

cooling system,” and that the “combination of (a) the tube placement relative to the engine and

(b) use of plastic composite material to carry the coolant[] virtually guarantees that the plastic

coolant tubes [PCNA] used in [its] Cayennes will prematurely fracture and fail.” (Id. ¶¶ 46, 53). 

The Court finds that these factual allegations are sufficient to assume that PCNA had

9

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 9 of 131 PAGEID #: <pageID>
knowledge of the alleged coolant tube defect at all times relevant. PCNA argues that Plaintiffs

fail to allege “which defendant knew of the supposed defect, when each learned of it, or how

each responded” and “when the decision to conceal the defect was made, who made it, where it

occurred, and where it was implemented.” (ECF No. 62, at 31; No. 91, at 51.) But Rule 9(b)

provides that “knowledge[] and other conditions of a person’s mind may be alleged generally.” 

Fed. R. Civ. P. 9(b). Furthermore, Plaintiffs allege that both PCNA and Porsche AG played a

role in manufacturing, marketing, and selling the vehicles and that, at the time the vehicles were

manufactured and warranted, both PCNA and Porsche AG knew or should have known of the

defect due to the mechanics of the design and pre-release testing data. (ECF No. 35 ¶¶ 33–34.) 

Plaintiffs allege that PCNA received complaints, dealer inquiries, and post-release testing data

that would have further informed them of the defect. In 2008, PCNA allegedly issued a

technical bulletin confirming this knowledge. The Court finds that these facts are sufficient to

provide PCNA fair notice of the allegation that it knew of the alleged defect at all times relevant. 

See Michaels Bldg. Co., 848 F.2d at 680. The specific “when the decision to conceal the defect

was made, who made it, where it occurred, and where it was implemented” are facts that, if they

exist, are likely within PCNA’s control and are best addressed after the close of discovery. See

id. The Court will therefore assume, for purposes of this analysis, that PCNA knew of the

alleged defect at the time it sold the vehicles. Whether this knowledge is actionable will depend

on the law underlying the thirty-two claims for relief. 

The Court next examines Plaintiffs’ allegations regarding affirmative misrepresentations. 

Plaintiffs provide seven specific statements that Defendants allegedly made “in [their] brochures

10

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 10 of 131 PAGEID #: <pageID>
and other marketing material” regarding the Cayenne’s cooling system. (ECF No. 35 ¶ 62.)2

The Court will assume for purposes of this motion that Defendants made these statements;

however, Plaintiffs’ claim that these specific representations “had the likely effect of misleading

the public, including Plaintiffs and the other members of the Class” is a conclusory statement

that is not entitled to a presumption of truth. See Twombly, 550 U.S. at 555. Plaintiffs do not

identify which Defendant made the alleged statements or the time or place at which the

statements were made. Nor do Plaintiffs allege the time or place at which the marketing

materials containing said statements were distributed or made available. Without more,

Plaintiffs fail to plead the circumstances surrounding PCNA’s affirmative misrepresentations

with the particularity that Rule 9(b) requires. See Bennett, 607 F.3d at 1100; see also Cataldo v.

U.S. Steel Corp., 676 F.3d 542, 551 (6th Cir. 2012) (finding that the plaintiff failed to satisfy

2

PCNA allegedly misrepresented that: 

(a) The Cayenne includes “a cooling system perfected in the deserts of Dubai;”

(b) “In the V8 on the Cayenne Turbo and Cayenne S, we’ve used a special coolant

management system offering effective control of operating temperatures throughout

every part of the engine;”

(c) “The entire cooling system is specifically designed for prolonged heavy-duty

operation;”

(d) “Every technical detail has been examined and optimized to ensure that the

Cayenne Turbo reaches benchmark levels of SUV performance;”

(e) “The cooling system is extremely robust;”

(f) “The Cayenne Turbo engine is among the most advanced internal combustion

engines ever produced by Porsche [and that] this mechanical symphony integrates

a

list of technical features that is a culmination of everything our engineers have

learned about watercooled V8 engines and turbo technology over the past four

decades;”

(g) “The Cayenne V8 engine’s cooling system helps to maximize performance in

every respect [and that] the strategy for achieving these objectives is nothing if not

thorough.”

(ECF No. 35 ¶ 62.)

11

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 11 of 131 PAGEID #: <pageID>
Rule 9(b) where his allegation “omit[ted] entirely the time and place of the alleged statements”

and referred only to “defendants” despite the fact that there were several defendants in the case);

Culy Constr. & Excavating, Inc. v. Laney Directional Drilling Co., No. 2:12-cv-4, 2012 WL

2071804, at *6–7 (S.D. Ohio June 8, 2012). 

Against this backdrop, the Court considers Plaintiffs’ claims. 

IV. Discussion

A. NATIONWIDE CLASS

Plaintiffs bring their first claim for relief on behalf of a purported nationwide class,

defined as all current and former owners or lessees of a 2003–2010 model year Cayenne. On

behalf of this class, Plaintiffs allege that PCNA violated the Magnuson-Moss Federal Warranty

Act (“Magnuson-Moss” or “Act”), 15 U.S.C. § 2301 et seq., and that Plaintiffs sustained

damages as a result. PCNA moves to dismiss this claim in its entirety. 

Count One: Magnuson-Moss Act

Magnuson-Moss provides a civil claim for relief for consumers who are damaged by a

supplier or warrantor’s failure to comply with its obligations under a written or implied warranty

or under the Act in issuing such a warranty. 15 U.S.C. § 2301(d)(1). In order to state a claim

under the Act, a plaintiff must demonstrate that (i) the item at issue was subject to a warranty;

(ii) the item did not conform to the warranty; (iii) the seller was given reasonable opportunity to

cure any defects; and (iv) the seller failed to cure the defects within a reasonable time or a

reasonable number of attempts. Temple v. Fleetwood Enters., Inc., 133 F. App’x 254, 268 (6th

Cir. 2005). 

1. Written Warranty

12

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 12 of 131 PAGEID #: <pageID>
Plaintiffs appear to concede that no individual plaintiff has a valid claim for breach of

express warranty. PCNA asserts, and the Complaint corroborates, that “no plaintiff claims to

have had any problems with his or her coolant pipes until after the applicable warranty term

expired.” (ECF No. 62, at 12.) Plaintiffs do not contest this assertion. Without more, Plaintiffs

fail to allege an actionable breach of express warranty claim. They therefore cannot advance a

Magnuson-Moss claim premised on this theory. Temple, 136 F. App’x at 268. 

 Similarly unsuccessful is Plaintiffs’ attempt to “reserve their express warranty claims

under Magnuson-Moss for those [currently unnamed] class members whose express warranties

may have not yet expired.” (ECF No. 77, at 28.) Plaintiffs offer no authority that would allow

them to “reserve” such claims and the Court is not aware of any such authority. The Sixth

Circuit has stated that “[i]f it is found, prior to class certification, that the named plaintiffs’

individual claims are without merit, then dismissal is proper.” J&R Mktg., SEP v. Gen. Motors

Corp., 549 F.3d 384, 390 (6th Cir. 2008). See also Lewis v. Casey, 518 U.S. 343, 357 (1996)

(“[N]amed plaintiffs who represent a class must allege and show that they personally have been

injured, not that injury has been suffered by other, unidentified members of the class to which

they belong and which they purport to represent.”). Because Plaintiffs fail to state a claim for

breach of express warranty, their Magnuson-Moss claim based on this theory must be dismissed. 

The Court GRANTS PCNA’s motion to dismiss Plaintiffs’ Magnuson-Moss claim to the

extent that it is premised on an alleged breach of express warranty. 

2. Implied Warranty 

 Plaintiffs note in their memorandum in opposition that only Colorado, Michigan, New

Jersey, Texas, Georgia, and Ohio Plaintiffs are “raising claims” under the Act’s implied warranty

13

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 13 of 131 PAGEID #: <pageID>
provisions. (ECF No. 77, at 32.) California, Florida, New York, and Washington Plaintiffs are

therefore excluded from the nationwide class’s Magnuson-Moss claim. To the extent that these

Plaintiffs are asserting Magnuson-Moss claims as part of the nationwide class, the Court

dismisses their claims as they relate to PCNA. See J&R Mktg., 549 F.3d at 390. The Court

GRANTS PCNA’s motion to dismiss California, Florida, New York, and Washington Plaintiffs’

Magnuson-Moss claims in their entirety. 

 The remaining Plaintiffs allege that PCNA failed to comply with its implied warranties

in violation of Magnuson-Moss. The Act defines “implied warranty” as “an implied warranty

arising under State law (as modified by sections 108 and 104(a) [15 U.S.C. §§ 2308 and

2304(a)]) in connection with the sale by a supplier of a consumer product.” 15 U.S.C. § 2301(7). 

Courts have uniformly held that Congress intended the Act’s implied warranty provisions to be

interpreted in accordance with the relevant state’s law, except as expressly modified by the Act. 

See Walsh v. Ford Motor Co., 807 F.2d 1000, 1013–14 (D.C. Cir. 1986). The Court must

therefore determine whether Plaintiffs state a claim for breach of implied warranty under the

laws of Ohio, Georgia, New Jersey, Colorado, Michigan, and Texas in order to determine which

Plaintiffs are included in the nationwide class. 

PCNA offers three arguments as to why this Court should dismiss Plaintiffs’ MagnusonMoss claim. First, PCNA argues that the Act does not supplant state privity requirements and

that Georgia and Ohio Plaintiffs’ claims fail for lack of privity. Second, PCNA argues that the

Warranties effectively limit the duration of all implied warranties to the duration of the Warranty

Period (four-years/50,000 miles), which had expired by the time the alleged defect manifested in

each Plaintiff’s vehicle. Finally, PCNA argues that Plaintiffs are precluded from bringing their

14

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 14 of 131 PAGEID #: <pageID>
Magnuson-Moss claims because they failed to provide PCNA with an opportunity to cure the

defect. The Court will consider each of these arguments in turn. 

a. State Privity Requirements – Georgia and Ohio

It is well settled that Magnuson-Moss does not supplant state law privity requirements. 

Abraham v. Volkswagen of Am., Inc., 795 F.2d 238, 249–51 (2d Cir. 1986); see also Gill v. Blue

Bird Body Co., 147 F. App’x 807, 810 (11th Cir. 2005) (citing Voelker v. Porsche Cars N. Am.,

Inc., 353 F.3d 516, 525 (7th Cir. 2003); Abraham, 795 F.2d at 249). The Court therefore looks

to Georgia and Ohio state law to determine whether Georgia and Ohio Plaintiffs may advance

implied warranty claims under the Act as part of the nationwide class. 

For the reasons set forth in Section IV(E) of this Opinion and Order (Count Eleven), the

Court finds that Georgia Plaintiff fails to meet the privity requirements that are necessary to

sustain an implied warranty of merchantability claim under Georgia law. See infra Section

IV(E) (Count Eleven). Georgia Plaintiff therefore fails to state an implied warranty claim under

Magnuson-Moss. See Temple, 136 F. App’x at 268.

The Court similarly finds that Ohio Plaintiffs fail to satisfy Ohio’s privity requirements

for a breach of implied warranty claim under Magnuson-Moss. Although Ohio courts recognize

two forms of implied warranty claims—implied warranty in tort and implied warranty of

merchantability (contract)—only the latter can form the basis of a Magnuson-Moss claim. See

Curl v. Volkswagen of Am., Inc., 114 Ohio St. 3d 226, 2007-Ohio-3609, 871 N.E.2d 1141, ¶ 28. 

Ohio Plaintiffs concede that they cannot advance an implied warranty of merchantability claim

because they are not in privity with PCNA. Ohio Plaintiffs therefore fail to state a MagnusonMoss claim.

15

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 15 of 131 PAGEID #: <pageID>
Ohio Plaintiffs’ argument that their Magnuson-Moss claim survives based on their

implied warranty in tort claim—which does not require privity—is without merit. In Curl, the

Ohio Supreme Court confronted the following question: does Ohio law require that the parties be

in privity of contract in order for a plaintiff to state a claim for breach of implied warranty under

Magnuson-Moss? Curl, 114 Ohio St. 3d ¶ 1. The court unequivocally answered yes. Id. ¶ 28. 

The court reasoned that privity requirements for contractual claims, such as those arising under

the Uniform Commercial Code (“UCC”) and Magnuson-Moss, allow sellers of goods to define

the scope of their responsibility and provide a greater degree of foreseeability regarding potential

claimants. Id. ¶ 26. The court also cited Walsh v. Ford Motor Co., which provides that

“Magnuson-Moss is strictly a warranty statute based in contract law” and that “[i]t is plain to the

Court that where a State permits warranty claims that are based on either tort or contract law, the

Court must look exclusively to contract law to determine whether privity is required.” 588 F.

Supp. 1513, 1527 (D.D.C. 1984). The Curl court implicitly reached this same conclusion. See

114 Ohio St. 3d ¶ 28. Ohio Plaintiffs’ implied warranty in tort claim cannot form the basis of

their Magnuson-Moss claim. 

The Court finds that Ohio and Georgia Plaintiffs fail to state a claim for breach of

implied warranty under Magnuson-Moss. These Plaintiffs are therefore excluded from the

nationwide class’s Magnuson-Moss claim. Accordingly, the Court GRANTS PCNA’s motion to

dismiss Georgia and Ohio Plaintiffs’ Magnuson-Moss claims in their entirety. 

b. Durational Limitation – Colorado, Michigan, New Jersey, and Texas

The Court now considers the remaining Plaintiffs’ allegations. Colorado, Michigan, New

Jersey, and Texas have each adopted the UCC’s implied warranty provisions. In each state, a

16

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 16 of 131 PAGEID #: <pageID>
seller warrants that its goods shall be merchantable in every contract for the sale of those goods,

subject to certain restrictions. UCC § 2-314 (2011).3 Magnuson-Moss provides that a

seller/warrantor may limit the duration of this implied warranty “to the duration of a written

warranty of reasonable duration, if such limitation is conscionable and is set forth in clear and

unmistakable language and prominently displayed on the face of the warranty.” 15 U.S.C. §

2308(b).

It is undisputed that the Warranties purport to limit the duration of all implied warranties

to a period of four-years/50,000 miles and that this period had expired by the time the alleged

defect manifested in each Plaintiff’s vehicle. The parties dispute whether this durational

limitation is enforceable under the Act. Plaintiffs argue that the Warranties’ limitation is

unenforceable because it is unconscionable and because it is not conspicuous. The Court finds

that Plaintiffs have sufficiently alleged facts to suggest that the limitation is unconscionable;

thus, it does not consider the parties’ arguments regarding conspicuousness. 

As an initial matter, PCNA argues that the Court should refuse to consider the

unconscionability arguments of Colorado, Michigan, and Texas Plaintiffs because these

plaintiffs do not mention the word “unconscionable” in asserting their specific claims for relief.4

3

Section 2-314 of the UCC states (in relevant part): “Unless excluded or modified

(Section 2-316), a warranty that the goods shall be merchantable is implied in a contract for their

sale if the seller is a merchant with respect to goods of that kind.” UCC § 2-314. See Col. Rev.

Stat. § 4-2-314 (adopting UCC § 2-314 as Colorado law); Mich. Comp. Laws § 440.2314

(adopting UCC § 2-314 as Michigan law); N.J. Stat. Ann. § 12A:2-314 (adopting UCC § 2-314

as New Jersey law); Tex. Bus. & Com. Code Ann. § 2.314 (adopting UCC § 2-314 as Texas

law). 

4

Each state’s plaintiffs asserted independent claims in the context of one omnibus

Complaint; Plaintiffs expressly incorporated the preceding paragraphs of the Complaint into

each independent claim for relief. (ECF No. 35.) The Complaint also includes a section that sets

17

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 17 of 131 PAGEID #: <pageID>
The Court rejects this argument for two reasons. First, the relevant question for this Court is

whether Plaintiffs have alleged sufficient facts in support of their unconscionability argument,

not whether they have specifically alleged certain terms. See, e.g., Alban v. BMW of N. Am.,

LLC, No. 09-5398, 2011 WL 900114, at *8–9 (D.N.J. Mar. 15, 2011) (“Alban II”) (dismissing a

plaintiff’s implied warranty claim premised on unconscionability when she failed to plead facts

in support of her unconscionability allegations); see also Tullis v. UMB Bank, N.A., 515 F.3d

673, 680–81 (6th Cir. 2008) (stating that courts should not “elevate form over substance” in

deciding a motion to dismiss; the complaint need only put the defendant on notice of the claim). 

Second, PCNA had adequate notice that Plaintiffs were challenging the Warranties’

durational limitation on this ground. New Jersey Plaintiffs specifically alleged that any

limitation or negation of the implied warranty, including any time limitation, is unconscionable

and unenforceable. See In re Polyurethane Foam Antitrust Litig., 799 F. Supp. 2d at 782 (stating

that a court should view each allegation in the context of the entire complaint); cf. In re Onstar

Contract Litig., 600 F. Supp. 2d 861, 879 (E.D. Mich. 2009) (dismissing claim for breach of

express warranty over an “unconscionability” challenge when the complaint “contain[ed] no

allegations whatsoever that the express written warranties . . . are unconscionable”). PCNA also

referenced unconscionability in its motion and argued that the Warranties’ durational limitation

was enforceable and not unconscionable; thus, PCNA cannot now argue that this claim was a

surprise. The Court will consider Colorado, Michigan, Texas, and New Jersey Plaintiffs’

substantive arguments regarding unconscionability. 

Federal courts look to substantive state law in determining whether a durational

forth the factual allegations common to all Plaintiffs. 

18

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 18 of 131 PAGEID #: <pageID>
limitation on an implied warranty is unconscionable. See, e.g., Alban v. BMW of N. Am., LLC,

No 09-5398, 2010 WL 3636253, at *8 (D.N.J. Sept. 8, 2010) (“Alban I”). PCNA does not offer

arguments specific to each state; instead, it argues that the Warranties’ durational limitation is

not unconscionable under New Jersey law and that there are no meaningful distinctions between

New Jersey law and the laws of the other states. 

In New Jersey, courts look to the circumstances surrounding the formation of a contract

to determine whether procedural or substantive unconscionability exists. Sitogum Holdings, Inc.

v. Ropes, 800 A.2d 915, 921 (N.J. Super. Ct. 2002). Facts suggesting that the bargaining process

was fundamentally unfair or that the resulting contractual provision is “so one-sided as to shock

the court’s conscience” would support a finding of unconscionability. Id.; see also Carlson v.

Gen. Motors Corp., 883 F.2d 287, 294–97 (4th Cir. 1989). 

The fact that a manufacturer had knowledge of a defect at the time it issued a warranty

does not make a time/mileage limitation on an implied warranty unconscionable. Henderson v.

Volvo Cars N. Am. LLC, No. 09-4146, 2010 U.S. Dist LEXIS 73624, at *26 (D.N.J. July 21,

2010). Such knowledge is, however, relevant in determining whether the bargaining process was

fundamentally fair. Carlson, 883 F.2d at 294–97. In other words, although a manufacturer’s

knowledge of a defect will not invalidate a durational limitation, the relevant question in the

unconscionability context is whether one party abused its superior knowledge and the opposing

party’s relative ignorance so as to create an exchange of obligations that is substantively

unconscionable. Id. at 296. 

The Carlson court provided several examples of facts that would support a finding of

19

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 19 of 131 PAGEID #: <pageID>
unconscionability.5

 For example, when a manufacturer is aware that its product is inherently

defective and the buyer has no notice of or ability to detect the problem, “there is perforce a

substantial disparity in the parties’ relative bargaining power.” Id. See also Henderson, 2010

U.S. Dist. LEXIS 73624, at *26 n.6 (finding that the plaintiff’s allegation that a “gross disparity

in bargaining power” existed between the parties was sufficient to support a finding of

unconscionability at the motion to dismiss stage). The fact that a defect is likely to substantially

limit the product’s intended use only amplifies this disparity. See id. at 294 (finding it “most

significant” that the plaintiffs alleged that the defendant knew of but concealed from consumers

the fact that an inherent defect could cause “catastrophic failures”). Similarly, facts suggesting

that the stronger party knew that the weaker party would be unable to receive substantial benefit

from the contract invokes both procedural and substantive unconscionability. See id. at 296;

Sitogum Holdings, 800 A.2d at 921. The Carlson court considered other allegations such as the

“lack of effective warranty competition among dominant firms in the automobile manufacturing

industry” but suggested that the contracting parties’ knowledge disparity was perhaps the “most

significant” factor in its unconscionability analysis. Carlson, 883 F.2d at 294. 

The question for this Court is not whether the Warranties’ durational limitation is

unconscionable as a matter of law, but whether Plaintiffs have alleged sufficient facts to state a

5

The Court notes that Carlson is still good law despite the fact that it preceded Twombly

and Iqbal. In Alban II, the court questioned Carlson’s persuasive value because the Carlson

court stated, in denying the defendant’s motion to dismiss, that “ ‘unconscionability should but

rarely be determined on the bare bones pleadings.’ ” 2011 WL 900114, at *8 (citing Carlson,

883 F.2d at 292). Alban II does not cast doubt upon the general principles underlying the

doctrine of unconscionability that the Carlson court espoused. If a plaintiff can set forth facts

sufficient to support his or her allegations of unconscionability, the claim will survive a motion

to dismiss.

20

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 20 of 131 PAGEID #: <pageID>
prima facie case of unconscionability. See, e.g., id. at 293–94.6

 Plaintiffs have made such a

showing in this case. 

Necessarily viewing the Complaint in its entirety and drawing all reasonable inferences

in Plaintiffs’ favor, Plaintiffs (and Colorado, Michigan, Texas, and New Jersey Plaintiffs by

incorporation) allege facts suggesting that PCNA knew that the Cayenne’s coolant system was

inherently defective and that purchasers would bear the cost of correcting that defect. See supra

Section III(B). PCNA allegedly knew that, in order to keep the vehicle in use after the Warranty

Period, consumers would be required to purchase a part that is significantly more expensive than

the part with which the Cayenne was originally equipped. Plaintiffs also allege facts suggesting

that the defect could substantially damage other parts of the engine and/or render the vehicle

inoperable. Finally, Plaintiffs allege facts suggesting that PCNA did not disclose this

information to purchasers, that purchasers could not have seen the defect given the design and

placement of the coolant tubes in the vehicle, and that such information would have altered each

individual plaintiff’s buying decisions. 

These facts are sufficient to suggest that there existed a “substantial disparity in the

parties’ relative bargaining power” in this case such that Plaintiffs were unable to receive a

substantial benefit from the Warranties’ four-year/50,000 mile implied warranty coverage. See

Carlson, 883 F.2d at 294; cf. Alban, 2011 WL 900114, at *8 (rejecting the plaintiff’s argument

6

The UCC expressly requires that courts not make substantive findings of

unconscionability at the motion to dismiss stage. See UCC § 2-302(2) (“When it is claimed or

appears to the court that the contract or any clause thereof may be unconscionable the parties

shall be afforded a reasonable opportunity to present evidence as to its commercial setting,

purpose and effect to aid the court in making the determination.”). Parties must, however, allege

sufficient facts to invoke this provision. See Carlson, 883 F.2d at 293–94; Alban II, 2011 WL

900114, at *8. 

21

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 21 of 131 PAGEID #: <pageID>
that a durational limitation on an implied warranty was unconscionable because plaintiff failed to

plead facts supporting his assertions that he had “no meaningful choice” in the bargaining

process and that a “gross disparity in bargaining power existed”). Plaintiffs have sufficiently

alleged facts suggesting that both procedural and substantive unconscionability exist in this case

so as to defeat the motion to dismiss. 

The Court notes that this holding does not contradict the Second Circuit’s decision in

Abraham v. Volkswagen of America, Inc., on which PCNA relies throughout its motion. 795

F.2d at 249–51. The Abraham court held that a plaintiff could not pursue a claim for breach of

express warranty after the warranty period had expired by alleging that the manufacturer had

knowledge of a defect at the time it issued the warranty. Id. at 249–50. The court stated: 

Moreover, virtually all product failures discovered in automobiles after

expiration of the warranty can be attributed to a “latent defect” that existed at the

time of sale or during the term of the warranty. All parts will wear out sooner or later

and thus have a limited effective life. Manufacturers always have knowledge

regarding the effective life of particular parts and the likelihood of their failing

within a particular period of time. Such knowledge is easily demonstrated by the fact

that manufacturers must predict rates of failure of particular parts in order to price

warranties and thus can always be said to “know” that many parts will fail after the

warranty period has expired. A rule that would make failure of a part actionable

based on such “knowledge” would render meaningless time/mileage limitations in

warranty coverage.

Id. at 250.

 The Carlson court distinguished the express warranty context in which this language

arose from the implied warranty context. See 883 F.2d at 294–97. The Carlson court reasoned

that the Abraham court was called upon to decide the reasonableness of an express warranty’s

temporal limitation, which is an objective analysis based on a reasonable consumer’s

expectations. Carlson, 883 F.2d at 295. The manufacturer’s subjective knowledge is therefore

22

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 22 of 131 PAGEID #: <pageID>
not relevant in the express warranty context. Id. Unlike temporal limitations on express

warranties, however, temporal limitations on implied warranties must not only be reasonable but

also conscionable. 15 U.S.C. § 2308 (“[I]mplied warranties may be limited in duration to the

duration of a written warranty of reasonable duration, if such limitation is conscionable . . . .”). 

Unconscionability is a “broader question” than reasonableness and implicates the parties’

subjective knowledge in the bargaining process. Carlson, 883 F.2d at 295. This Court’s holding

is therefore consistent with both Carlson and Abraham. 

The Court finds that Colorado, Michigan, Texas, and New Jersey Plaintiffs have alleged

sufficient facts to support the inference that the Warranties’ durational limitation on all implied

warranties was unconscionable. Thus, for purposes of this motion, the Court assumes that the

implied warranty of merchantability had not expired at the time the alleged defect manifested in

Colorado, Michigan, Texas, and New Jersey Plaintiffs’ vehicles. PCNA offers no additional

arguments regarding these Plaintiffs’ implied warranty claims. The Court finds that Colorado,

Michigan, Texas, and New Jersey Plaintiffs state a claim for breach of the implied warranty of

merchantability under the law of their respective states, as modified by Magnuson-Moss. 

c. Opportunity to Cure 

To prevail on a Magnuson-Moss claim, a plaintiff must demonstrate not only that a

product failed to live up to its written or implied warranties, but also that the seller had an

“opportunity to cure” the alleged defect and failed to do so. Temple, 133 F. App’x at 268; 15

U.S.C. § 2310(e). PCNA argues that the opportunity to cure requirement is a condition

precedent to filing suit and that, because Plaintiffs failed to provide PCNA with an opportunity

to cure before they filed their Complaint, dismissal of their Magnuson-Moss claim is proper. 

23

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 23 of 131 PAGEID #: <pageID>
PCNA’s argument is not well taken. 

Section 2310(e) sets forth the Act’s opportunity to cure requirement. Under Section

2310(e): 

No action (other than a class action or an action respecting a warranty to which

subsection (a)(3) applies) may be brought under subsection (d) for failure to comply

with any obligation under any written or implied warranty or service contract, and

a class of consumers may not proceed in a class action under such subsection with

respect to such a failure except to the extent the court determines necessary to

establish the representative capacity of the named plaintiffs, unless the person

obligated under the warranty or service contract is afforded a reasonable opportunity

to cure such failure to comply. In the case of such a class action . . . brought under

subsection (d) for breach of any written or implied warranty or service contract, such

reasonable opportunity will be afforded by the named plaintiffs and they shall at that

time notify the defendant that they are acting on behalf of the class. In the case of

such a class action which is brought in a district court of the United States, the

representative capacity of the named plaintiffs shall be established in the application

of rule 23 of the Federal Rules of Civil Procedure. 

15 U.S.C. § 2310(e) (emphasis added). 

The plain language of the statute imposes different requirements on individual plaintiffs

and class action plaintiffs regarding the time at which they must satisfy the opportunity to cure

requirement. See id. For individual plaintiffs, Section 2310(e) is a condition precedent to filing

suit unless the warrantor establishes an informal dispute settlement procedure pursuant to

Section 2310(a)(3). See id. In contrast, plaintiffs bringing a class action may file suit before the

defendant is afforded an opportunity to cure for the limited purpose of establishing the

representative capacity of the named plaintiffs. See id. Once a court makes this determination,

but before the class action can proceed, the defendant must be afforded an opportunity to cure

the alleged breach of warranty and the named plaintiffs must at that point inform the defendant

that they are acting on behalf of a class. See id.; see also Walsh v. Ford Motor Co., 807 F.2d

1000, 1004 (D.C. Cir. 1986) (interpreting the plain language of Section 2310(e) as indicating that

24

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 24 of 131 PAGEID #: <pageID>
“a plaintiff may file a class action, but may not proceed with that action, until she has afforded

the defendant a reasonable opportunity to cure its alleged breach”); In re Sears, Roebuck & Co.

Tools Mktg. & Sales Practices Litig., No. MDL-1703, 2012 WL 1015806, at *5 (N.D. Ill. Mar.

22, 2012) (“[T]he statute allows a Magnuson-Moss class action to be brought before the

defendant is given an opportunity to cure (only to the point of establishing the named plaintiffs’

representative capacity) . . . .”). 

PCNA cites cases in which courts have dismissed class action Magnuson-Moss claims

because the plaintiff failed to satisfy Section 2310(e) prior to filing suit, but this result

contradicts the plain language of the statute. To hold that no class action “may be brought . . .

unless the person obligated under the warranty or service contract is afforded a reasonable

opportunity to cure” would read the “other than a class action” language out of the statute and

would nullify the phrase that “a class of consumers may not proceed in a class action . . . except

to the extent the court determines necessary to establish the representative capacity of the named

plaintiffs.” 15 U.S.C. § 2310(e). The only way to reconcile the latter clause with the rest of the

statute is to read Section 2310(e) as standing for the proposition that a class action may be

brought, but may not proceed once the court determines the representative capacity of the named

plaintiffs, until the defendant is provided with an opportunity to cure the alleged defect. See id. 

If a class action may not be brought unless a defendant first is afforded an opportunity to cure

the alleged breach, then the phrase “a class of consumer may not proceed in a class action”

would not make sense. There would be nothing to proceed with because no case would have

been brought. 

The courts that interpreted Section 2310(e) to dismiss a plaintiff’s class action claim at

25

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 25 of 131 PAGEID #: <pageID>
the pleadings stage failed to account for this language in the statute. In Bearden v. Honeywell,

for example, the court dismissed a plaintiff’s putative class action because she failed to notify the

defendant that she was acting on behalf of a class prior to filing her claim. 720 F. Supp. 2d 932,

936 (M.D. Tenn. 2010) (citing Stearns v. Select Comfort Retail Corp., No. 08-2746, 2009 WL

4723366, at *10 (N.D. Cal. Dec. 4, 2009)). See also Rehberger v. Honeywell Int’l, Inc., No.

3:11-0085, 2011 WL 780681, at *11 (M.D. Tenn. Feb. 28, 2011) (citing Bearden and dismissing

a class action Magnuson-Moss claim because the plaintiff failed to provide the defendant with an

opportunity to cure prior to filing suit). In so holding, however, the Bearden court omitted the

phrase “other than a class action ” from its quotation of Section 2310(e) and stated, with no

apparent analysis, that class actions are subject to the same “no action . . . may be brought”

language that applies to claims brought by individual plaintiffs. 720 F. Supp. 2d at 936. The

Stearns and Rehberger courts similarly dismissed class action claims under Section 2310(e)

without acknowledging the language in the statute that removes class actions from the

requirement that “no action . . . may be brought” until the defendant is afforded an opportunity to

cure. See Stearns, 2009 WL 4723366, at *10; Rehberger, 2011 WL 780681, at *11; 15 U.S.C. §

2310(e).

The Court finds that Section 2310(e) does not mandate dismissal of Plaintiffs’ class

action claim at this stage of the litigation. Thus, the Court does not consider the parties’

arguments regarding PCNA’s alleged knowledge of the defect as an appropriate substitute for

notice under Section 2310(e). The Court DENIES PCNA’s motion to dismiss Count One of

Plaintiffs’ Complaint to the extent that it is comprised of Colorado, Michigan, Texas, and New

Jersey Plaintiffs’ claims for breach of implied warranty of merchantability under Magnuson26

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 26 of 131 PAGEID #: <pageID>
Moss. 

The Court GRANTS IN PART and DENIES IN PART PCNA’s motion to dismiss

Count One of Plaintiff’s Complaint. 

B. CALIFORNIA 

California Plaintiffs Bob Conrad, David Graas, Sean Krider, and Sy Duc Tran each

purchased Cayennes that came equipped with plastic coolant tubes. Plaintiffs Conrad and Tran

purchased their vehicles new from Porsche dealerships, and Plaintiffs Graas and Krider

purchased used Cayennes from unidentified sellers. All four California Plaintiffs experienced

problems with their coolant tubes, and each paid to install aluminum coolant pipes in their

vehicles. California Plaintiffs do not claim that these problems began while any of their vehicles

were under warranty. 

California Plaintiffs bring claims under California’s Consumer Legal Remedies Act, Cal.

Civil Code § 1750 et seq., California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200

et seq., and for unjust enrichment. PCNA moves to dismiss each claim. 

Count Two: California’s Consumer Legal Remedies Act 

California Plaintiffs allege that PCNA violated the California Consumer Legal Remedies

Act (“CLRA”) by failing to disclose and/or concealing from consumers the material fact that the

Cayenne’s plastic coolant tubes were defective and would likely fail before the life of the engine. 

California Plaintiffs allege that these facts were material because reasonable consumers, had they

known of the defect, would not have purchased the Cayenne or would have insisted on paying

less for it. California Plaintiffs seek injunctive relief, actual and punitive damages, and

attorney’s fees and costs under the CLRA. 

27

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 27 of 131 PAGEID #: <pageID>
The CLRA serves to “protect consumers against unfair and deceptive business practices

and to provide efficient and economical procedures to secure such protection.” Cal. Civ. Code. §

1760. Plaintiffs invoke sections five and seven of the CLRA, which proscribe:

(5) Representing that goods or services have sponsorship, approval,

characteristics, ingredients, uses, benefits, or quantities which they do not have or

that a person has a sponsorship, approval, status, affiliation, or connection which he

or she does not have. 

. . . 

(7) Representing that goods or services are of a particular standard, quality,

or grade, or that goods are of a particular style or model, if they are of another.

Id. § 1770(a)(5) & (7). 

Omissions are actionable under sections 1770(a)(5) and 1170(a)(7) of the CLRA where

(1) the omission is contrary to a defendant’s express representation or (2) the defendant failed to

disclose or concealed a fact that it had a duty to disclose. See Daugherty v. Am. Honda Motor

Co., 51 Cal. Rptr. 3d 118, 126 (Ct. App. 2006). In Daugherty, a California court of appeals

found that an automobile manufacturer had no duty to disclose a defective oil seal that would

manifest and require repairs after the vehicles’ warranties expired. Id. at 837. The court found

that the manufacturer’s silence was not contrary to any of its affirmative representations and that

the plaintiff had failed to allege facts suggesting that the defect constituted a safety risk. Id. at

835–37. See also Bardin v. DaimlerChrysler Corp. 39 Cal. Rptr. 3d 634, 648–49 (Ct. App.

2006) (dismissing the plaintiff’s CLRA claim because the manufacturer had no duty to disclose

the fact that it used steel in its vehicles’ exhaust manifolds instead of the more durable and

expensive cast iron). The court therefore affirmed the trial court’s dismissal of the plaintiff’s

CLRA claim. Daugherty, 51 Cal. Rptr. 3d at 128. 

28

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 28 of 131 PAGEID #: <pageID>
Courts have since cited Daugherty for the proposition that a manufacturer has no duty to

inform consumers of defects that will manifest outside the warranty period unless the

manufacturer has affirmatively misrepresented the defective nature of the product or the defect

poses a safety risk to consumers. See Wilson v. Hewlett-Packard Co., 668 F.3d 1136, 1141–43

(9th Cir. 2012); Oesteicher v. Alienware Corp., 322 F. App’x 489, 493 (9th Cir. 2009). 

Presumably, because a consumer expects that a manufacturer will guarantee its product against

unreasonable safety risks, both within and outside the warranty period, a manufacturer’s failure

to disclose such risks is misleading and therefore actionable under the CLRA. See, e.g., Decker

v. Mazda Motor of Am., Inc., No. SACV 11-0873, 2011 WL 5101705, at *4 (C.D. Cal. Oct. 24,

2011); see also Daugherty, 51 Cal. Rptr. 3d at 127. 

A defect that poses an objective, identifiable safety risk to consumers will trigger a duty

to disclose under the CLRA. See, e.g., Chlolakyan v. Mercedes-Benz USA, LLC, 796 F. Supp. 2d

1220, 1236–37 (C.D. Cal. 2011); Smith v. Ford Motor Co., 749 F. Supp. 2d 980, 989 (N.D. Cal.

2010), aff’d, No. 10-17321, 2011 WL 6322200 (9th Cir. Dec. 19, 2011). California courts have

found that defects in automobiles that could cause sudden or unexpected engine failure while

driving pose such a risk. See, e.g., Chlolakyan, 796 F. Supp. 2d at 1236–37. In Cholakyan, the

plaintiffs alleged that a defect caused water to enter the driver/front passenger foot well in their

vehicles, potentially causing electrical faults due to water in the control units. Id. at 1236. The

court found that plaintiffs had adequately pleaded a safety issue because they alleged that the

defect could cause “sudden and unexpected engine failure” while driving. See id. See also

Smith, 749 F. Supp. 2d at 990 (suggesting that “evidence that the [defect] causes engines to shut

off unexpectedly or causes individuals to stop their vehicles under dangerous conditions” would

29

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 29 of 131 PAGEID #: <pageID>
trigger a duty to disclose under the CLRA); Eisen v. Porsche Cars N. Am., No. CV 11-9405,

2012 WL 841019, at *5 (C.D. Cal. Feb. 22, 2012) (finding that plaintiff did not plead a safety

concern because he failed to indicate that “failure of the [defective part] somehow impairs

steering or other critical vehicle function”). PCNA acknowledges that vehicle defects that could

cause “sudden, unexpected engine failure” or related risks would evince a safety concern under

the CLRA. (ECF No. 62, at 41.)

Importantly, the Cholakyan court found that the plaintiffs had sufficiently alleged a

safety risk despite the fact that the water leak defect had not actually caused sudden engine

failure in their vehicles. 796 F. Supp. 2d at 1236–37 (rejecting defendant’s argument that “the

purported safety defects are speculative in nature, because there is no allegation that [plaintiff] or

any other class member ever experienced such a defect”); see also Ehrlich v. BMW of N. Am.,

LLC, 801 F. Supp. 2d 908, 918 (C.D. Cal. 2010) (“The Court is not persuaded . . . that Plaintiff

must plead that consumers have been injured by the alleged unreasonable safety risk.”). The

courts in both Cholakyan and Ehrlich concluded that the plaintiffs had standing to pursue their

CLRA claims because they incurred monetary damages in repairing the alleged defects in their

vehicles. See Cholakyan, 796 F. Supp. 2d at 1236–37; Ehrlich, 801 F. Supp. 2d at 918. They

therefore could invoke Daugherty’s safety exception without alleging any safety-related injuries. 

See Cholakyan, 796 F. Supp. 2d at 1236–37; Ehrlich, 801 F. Supp. 2d at 918. 

Here, Plaintiffs allege that the use of plastic coolant tubes in the Cayenne put consumers

at risk of engine failure while operating the vehicle. Necessarily taking all facts alleged in the

Complaint as true, Plaintiffs (and California Plaintiffs by incorporation) allege that “[a]s a result

of continuous exposure to extreme heat, plastic coolant tubes crack and leak” (ECF No. 35 ¶ 52);

30

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 30 of 131 PAGEID #: <pageID>
cracked coolant tubes result in “coolant seeping directly into the vehicle’s starter, transmission

seals, and other components causing possible engine damage and engine failure” (id. ¶ 3); that

coolant tube failure renders the vehicle “inoperable” (id. ¶ 54) or can “disabl[e] the vehicle” (id.

¶ 70); and that “acute failure of the [coolant tubes] can and sometimes does occur while traveling

at high speeds on public roadways” (id). These allegations are sufficient to support the inference

that the alleged defect can cause engine failure and render the vehicle inoperable while driving,

which is sufficient to allege a safety concern under California law. See, e.g., Smith, 749 F. Supp.

2d at 990. The Court finds that Plaintiffs have pleaded facts sufficient to invoke the second

Daugherty exception. 

PCNA’s arguments to the contrary are not persuasive. PCNA contests Plaintiffs’ factual

assertions and argues that coolant loss “does not impair a vehicle’s operability during the first

few minutes after it occurs,” pointing specifically to one named plaintiff who drove his vehicle

for four miles “without any adverse effect on vehicle operability.” (ECF No. 62, at 42.) These

arguments are not appropriate at the motion to dismiss stage. Here, the Court must accept that

coolant tube failure “renders the vehicle inoperable,” possibly while “traveling at high speeds.” 

(ECF No. 35 ¶¶ 9, 70). The fact that one of the named plaintiffs did not experience this result

does not alter this conclusion. See, e.g., Cholakyan, 796 F. Supp. 2d at 1236–37.

PCNA’s argument that Plaintiffs fail to establish a sufficient nexus between the alleged

defect and the purported safety risk is similarly unpersuasive. Plaintiffs describe the layout of

the Cayenne’s engine and explain how this layout “virtually guarantees” that plastic coolant

tubes will fracture. (ECF No. 35 ¶ 53.) Plaintiffs also explain how the cracked coolant tubes

cause coolant to leak into specific engine components and allege that such a leak disables the

31

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 31 of 131 PAGEID #: <pageID>
vehicle. (Id. ¶¶ 3, 70.) These allegations are sufficient to demonstrate a causal connection at this

stage of the litigation. See, e.g., Cholakyan, 796 F. Supp. 2d at 1236–37 (finding that an alleged

water leak defect that caused “electrical faults” in some cases could plausibly give rise to the

alleged safety concern of “sudden an unexpected engine failure”); Marisikian v. Mercedes Benz

USA, LLC, No. CV 08-04876, 2009 WL 8379784, at *6–7 (C.D. Cal. May 4, 2009) (denying

motion to dismiss a CLRA claim where the plaintiff alleged that air intake systems were

“susceptible to clogging” and the defect could lead to “substantial electrical failure” because “it

is not implausible that the [clogging] would cause catastrophic engine and electrical system

failure while the car is on the road” (internal citations omitted)). Cf. Wilson, 668 F.3d at 144

(holding that, where an alleged computer defect weakened the power connection between the

power jack and the motherboard, resulting in a loss of power to the computer, the plaintiff failed

to demonstrate how the alleged defect caused the computer to “ignite” and pose a safety

concern); Eisen, 2012 WL 841019, at *3 (finding that a plaintiff failed to allege a safety defect

with particularity when he alleged only that the engine shaft in his vehicle “failed” but did not

explain “how the shaft fails and how that failure affects the vehicle”). 

As a final note, the Court agrees with PCNA’s argument that the risk of being stranded is

too speculative to establish a safety concern as a matter of law. Smith, 749 F. Supp. 2d at 991

(where an alleged ignition lock defect prevented drivers from starting their engines, leaving them

“unexpectedly stranded,” the alleged risks were “speculative in nature, deriving in each instance

from the particular location at which the driver initially has parked the vehicle and/or the driver’s

individual circumstances.”); Smith, 2011 WL 632200, at *1; Eisen, 2012 WL 841019, at *5

(citing the Ninth Circuit’s decision in Smith and holding that an engine defect that could leave

32

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 32 of 131 PAGEID #: <pageID>
drivers stranded on the road, “susceptible to being hit by another vehicle,” was too speculative to

constitute a safety concern as a matter of law).7 As such, the individual experience of California

Plaintiff Graas, whose coolant tubes failed while traveling and left him “[s]tranded on the side of

the highway in the middle of the night,” plays no role in the Court’s decision that Plaintiffs have

adequately pleaded a safety concern. (ECF No. 77, at 61.) Considering those objective safety

risks that the Cayenne’s plastic coolant tubes allegedly pose to consumers, the Court finds that

Plaintiffs’ safety allegations are sufficient to survive a motion to dismiss. 

Plaintiffs have adequately pleaded facts to invoke Daugherty’s safety exception. The

Court therefore finds that Plaintiffs have sufficiently alleged that PCNA had a duty under

California law to disclose the alleged coolant tube defect to consumers. PCNA does not argue

that it disclosed the alleged defect or that such an omission is not otherwise actionable under the

CLRA. Accordingly, the Court finds that Plaintiffs state a claim for violations of the CLRA and

need not consider the parties’ arguments regarding the first Daugherty exception. The Court

DENIES PCNA’s motion to dismiss Count Two of Plaintiffs’ Complaint. 

Count Three: California’s Unfair Business Practices Act 

California’s Unfair Competition Law (“UCL”) proscribes “any unlawful, unfair or

7

Given the court’s finding in Eisen and the plethora of cases on point, Plaintiffs’ reliance

on Cabral v. Ralph’s Grocery Co., 248 P.3d 1170 (Cal. 2011) for the proposition that “simply

stopping on the side of the highway is unsafe” is misplaced. (ECF No. 77, at 61.) In Cabral, a

wrongful death case, the court confronted the issue of “whether a freeway driver owes other

drivers a duty of ordinary care in choosing whether, where and how to stop on the side of the

road.” Id. at 1176. The court differentiated between freeways and “urban, suburban and rural

roads” and suggested that the same standards may not apply in each case. Id. at 1183. 

Ultimately, the court declined to create an exception from the general duty of care for freeway

drivers, based in part upon a finding that accidents with vehicles on the side of the freeway were

foreseeable. See id. at 1177–82. This finding does not cast doubt upon the Eisen court’s

conclusion that such a risk is too speculative to trigger a duty to disclose under the CLRA. See

Eisen, 2012 WL 841019, at *5. 

33

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 33 of 131 PAGEID #: <pageID>
fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising.” Cal.

Bus. & Prof. Code § 17200; Cal-Tech Commc’ns v. L.A. Cellular Tel. Co., 973 P.2d 527, 539

(Cal. 1999). “Because . . . Section 17200 is written in the disjunctive, it establishes three

varieties of unfair competition—acts or practices which are unlawful, or unfair, or fraudulent.” 

Boschma v. Home Loan Ctr., Inc., 129 Cal. Rptr. 3d 874, 893 (Ct. App. 2011); see also Kearns v.

Ford Motor Co., 567 F.3d 1120, 1127 (9th Cir. 2009). California Plaintiffs allege that PCNA

engaged in unlawful, unfair, and fraudulent business practices by introducing a defective product

into the market and failing to disclose the alleged defect to consumers.

The case law suggests, and PCNA does not dispute, that allegations suggesting that a

defendant knew of and failed to disclose safety risks posed by its defective product are sufficient

to establish UCL liability under all three prongs of the statute. Based on its finding above, the

Court therefore finds that California Plaintiffs state a claim for relief under the unlawful, unfair,

and fraudulent prongs of the UCL. See supra Section IV(B) (Count Two). The Court addresses

the parties’ arguments regarding each prong. 

1. Unlawful Conduct 

By proscribing any “unlawful” business practice, the UCL “borrows violations of other

laws” and makes them “independently actionable” under the UCL. Cal-Tech Commc’ns, 973

P.2d at 539–40 (internal citations omitted). A violation of the CLRA can serve as a predicate for

a UCL claim. See, e.g., Stevens v. Super. Ct., 89 Cal. Rptr. 2d 370, 375 (Ct. App. 1999). 

California Plaintiffs state a claim under the CLRA and therefore sufficiently state a claim

under the UCL. See, e.g., Cal-Tech Commc’ns, 973 P.2d at 539–40. PCNA’s argument that

Plaintiffs failed to expressly incorporate their CLRA claim into their UCL claim is not

34

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 34 of 131 PAGEID #: <pageID>
persuasive. The Complaint invokes “the acts alleged in this Complaint” and put PCNA on notice

of the alleged CLRA violation. See, e.g., In re Polyurethane Foam Antitrust Litig., 799 F. Supp.

2d at 782 (noting that courts should view each allegation in the context of the entire complaint);

Tullis, 515 F.3d at 680–81 (stating that courts should not “elevate form over substance” in

deciding a motion to dismiss). Plaintiffs’ UCL claim premised on “unlawful” conduct therefore

survives PCNA’s motion to dismiss. 

2. Unfair Conduct 

To state a claim under the “unfairness” prong of the UCL, a plaintiff must demonstrate

(1) a substantial injury to consumers, (2) that the injury is not counterbalanced by an equivalent

or greater benefit to consumers or to competition, and (3) that consumers could not themselves

have avoided the injury. Daugherty, 51 Cal. Rptr. 3d at 129–30 (citing Cel-Tech Commc’ns, 973

P.2d at 539–544; and Camacho v. Auto. Club of S. Cal., 48 Cal. Rptr. 3d 770, 777 (Ct. App.

2006)). 

In general, California courts have found that a defendant’s failure to disclose defects that

will manifest post-warranty is not “unfair” under the UCL unless the defendant failed to inform

consumers of a fact that it had a duty to disclose under Daugherty. See Bardin, 39 Cal. Rptr. 3d

at 643–44 (affirming trial court’s dismissal of a UCL claim premised on unfair business practices

because the use of “less expensive and less durable materials in the manufacture of [the

defendant’s] vehicles to make more money” does not violate public policy absent one of the two

Daugherty exceptions);8 Falk v. Gen. Motors Corp., 496 F. Supp. 2d 1088, 1098 (N.D. Cal.

8

See also Daugherty, 51 Cal. Rptr. 3d at 130 (stating that, where a defect did not present

a safety concern, “the failure to disclose a defect that might, or might not, shorten the effective

life span of an automobile part that functions precisely as warranted . . . cannot be characterized

as causing a substantial injury to consumers, and accordingly does not constitute an unfair

35

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 35 of 131 PAGEID #: <pageID>
2007) (finding that a defendant’s failure to disclose defects, where it had a duty to disclose,

would in turn constitute an unfair practice under the UCL).9 Here, Plaintiffs have sufficiently

alleged that the use of plastic coolant tubes presents a safety risk that triggered a duty to disclose

under Daugherty. See supra Section IV(B) (Count Two). PCNA’s reliance on Daugherty,

Bardin, and Clemens therefore does not bar California Plaintiffs’ claim in this case. The Court

finds that California Plaintiffs’ claim for unfair practices under the UCL survives PCNA’s

motion to dismiss. 

 3. Fraudulent Conduct 

The fraudulent conduct prong of the UCL applies to acts that are either akin to common

law fraud or likely to deceive the public. In re Tobacco II Cases, 207 P.3d 20, 29 (Cal. 2009). 

Plaintiffs seeking to assert a UCL claim premised on fraudulent conduct must demonstrate that a

defendant’s alleged acts or omissions were material and likely to deceive a reasonable consumer. 

See id.; see also Bardin, 39 Cal. Rptr. 3d at 636. 

practice under the UCL”); Clemens v. DaimlerChrysler Corp., 534 F.3d 1017, 1026–27 (9th Cir.

2008) (citing Daugherty for the proposition that a defendant’s failure to disclose a defect that

might or might not shorten the effective life span of an automobile part does not cause a

substantial injury to consumers and therefore does not constitute an unfair practice under the

UCL).

9

The Court notes that the Falk court incorrectly found that a manufacturer has a duty

under California law to disclose defects that are material and would have altered consumers

buying decisions, regardless of whether those defects presented a safety risk. Falk, 496 F. Supp.

2d at 1095 (citing LiMandri v. Judkins, 60 Cal. Rptr. 2d 539, 543–44 (Ct. App. 1997)). The

Ninth Circuit rejected this broad test and found that a defect is only “material” for purposes of

the CLRA if it presents a safety risk. Wilson, 668 F.3d at 1141–42 (discussing Falk and stating

that, “for the omission to be material, the failure must still pose safety concerns” (citing Smith,

749 F. Supp. 2d at 987) (internal citations omitted)). Despite this discrepancy, the Falk court’s

holding that a manufacturer commits an unfair practice under the UCL when it fails to inform

consumers of a defect that it had a duty to disclose is consistent with Daugherty, Bardin, and

Clemens on this point. 

36

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 36 of 131 PAGEID #: <pageID>
PCNA cites Clemens v. Daimler Chrysler Corp. for the proposition that the public is not

likely to be deceived where the only expectation consumers could have had about a particular

engine component is that it would function properly for the duration of the express warranty. 

534 F.3d at 1026–27. As stated above, however, consumers expect that products will function

safely throughout and past the duration of the express warranty; a manufacturer’s failure to

disclose a defect that presents a safety risk is therefore deceptive under the CLRA. See, e.g.,

Decker, 2011 WL 5101705, at *4. The Court therefore concludes that a manufacturer’s failure

to disclose defects that present safety risks is likely to deceive a reasonable consumer under the

fraudulent prong of the UCL. Cf. Smith, 2011 WL 6322200, at *3 (rejecting a UCL claim

because the plaintiff failed to demonstrate that the alleged defect presented a safety issue to

consumers); O’Shea v. Epson Am., Inc., No. CV 09-80634, 2011 WL 3299936, at *6–7 (C.D.

Cal. July 29, 2011) (same). Because Plaintiffs have sufficiently alleged a safety risk under

California law, the Court finds that California Plaintiffs’ UCL claim premised on fraudulent

conduct survives PCNA’s motion to dismiss. 

California Plaintiffs state a claim for relief under the unlawful, unfair, and fraudulent

prongs of the UCL. Accordingly, the Court DENIES PCNA’s motion to dismiss Count Three of

Plaintiffs’ Complaint. 

Count Four: Unjust Enrichment (California)

California courts do not recognize unjust enrichment as an independent claim for relief. 

Melchior v. New Line Prods., Inc., 131 Cal. Rptr. 2d 347, 357 (Ct. App. 2003). Instead, unjust

enrichment “is a general principle underlying various doctrines and remedies, rather than a

remedy itself,” id., and “is synonymous with restitution.” Durell v. Sharp Healthcare, 108 Cal.

37

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 37 of 131 PAGEID #: <pageID>
Rptr. 682, 699 (Ct. App. 2010). Where a plaintiff seeks restitution under statutory claims for

relief, an attempt to plead a separate claim for unjust enrichment “adds nothing” to the

complaint. Jogani v. Super. Ct., 81 Cal. Rptr. 3d 503, 511 (Ct. App. 2008); see also Marsikian,

2009 WL 8379784, at *8 (dismissing a plaintiff’s unjust enrichment claim because “including

such a claim would not enlarge the range of remedies Plaintiffs may otherwise seek”). 

Here, Plaintiffs seek restitution in their statutory claims for relief. (ECF No. 35 ¶ 267

(“Pursuant to §§ 17203 and 17204 of the Business & Professions Code, California Plaintiffs and

the other California Sub-Class members are entitled to: . . . full restitution of all monies paid to

Porsche as a result of its deceptive practices . . . .” (emphasis added)).) If Plaintiffs cannot

recover under the CLRA, the purpose of which is to “protect consumers against unfair and

deceptive business practices and to provide efficient and economical procedures to secure such

protection,” Cal. Civ. Code § 1760, or the UCL, which addresses any “unlawful, unfair or

fraudulent business act or practice,” Cal. Bus. & Prof. Code § 17200, Plaintiffs may not pursue

an independent theory of restitution based on unjust enrichment. See Falk, 496 F. Supp. 2d at

1099 (dismissing a plaintiff’s unjust enrichment claim because “the sole remedies available for

the violations alleged have been discussed [under the CLRA and the UCL]. . . there will be no

occasion for resort to unjust enrichment”). If PCNA’s conduct is actionable under the CLRA

and/or the UCL, then Plaintiffs will recover the appropriate restitution under these statutes. 

Plaintiffs’ suggestion that there exists a split of authority in California regarding unjust

enrichment as an independent claim for relief is not persuasive. The state cases that Plaintiffs

cite involve a restitution theory as the sole claim. See Lectrodryer v. SeoulBank, 91 Cal. Rptr. 2d

881, 883–84 (Ct. App. 2000) (considering a restitution-based theory of recovery in a credit

38

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 38 of 131 PAGEID #: <pageID>
dispute); First Nationwide Sav. v. Perry, 15 Cal. Rptr. 2d 173, 176–77 (Ct. App. 1992) (same).

Where, as here, the unjust enrichment claim does not “enlarge the range of remedies” that a

plaintiff may seek and thus “adds nothing to the complaint,” dismissal is proper. Marsikian,

2009 WL 8379784, at *8; Jogani, 81 Cal. Rptr. 3d at 511. See also Falk, 496 F. Supp. 2d at

1099.

The Court finds that California Plaintiffs have failed to state a claim for relief under an

independent theory of unjust enrichment. Accordingly, the Court GRANTS PCNA’s motion to

dismiss Count Four of Plaintiffs’ Complaint. 

C. COLORADO

Colorado Plaintiff Kevin Starkey purchased a model-year 2006 Cayenne from an

unidentified seller in 2010. Colorado Plaintiff’s coolant tubes cracked in 2011, and the resulting

coolant leak damaged his transmission seals and caused the vehicle to cease operating. Colorado

Plaintiff paid to replace his coolant tubes with aluminum pipes and repair the other damage to his

vehicle. He now brings claims for violations of the Colorado Consumer Protection Act

(“CCPA”), Col. Rev. Stat. § 6-1-101 et seq., strict product liability, and breach of implied

warranty of merchantability under Colorado law. PCNA moves to dismiss each claim. 

Count Five: Colorado’s Consumer Protection Act 

 The CCPA provides a claim for relief for consumers who are injured by certain

“deceptive trade practices.” Col. Rev. Stat. § 6-1-113(1)(a) (consumers have a claim for relief);

§ 6-1-105 (identifying specific deceptive trade practices). Deceptive trade practices under the

CCPA include affirmative misrepresentations, such as “[representing] that goods, food, services,

or property are of a particular standard, quality, or grade, or that goods are of a particular style or

39

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 39 of 131 PAGEID #: <pageID>
model, if [the person] knows or should know that they are of another.” Id. § 6-1-105(1)(g); see

also id. §§6-1-105(1)(e), (i), and (r) (proscribing various types of affirmative misrepresentations

such as false advertising). The CCPA also proscribes “[failing] to disclose material information

concerning goods, services, or property which information was known at the time of an

advertisement or sale if such failure to disclose such information was intended to induce the

consumer to enter into a transaction.” Id. § 6-1-105(1)(u). 

Colorado Plaintiff invokes each of these sections and alleges that PCNA violated the

CCPA by knowingly misrepresenting the quality and characteristics of the Cayenne and by

falsely advertising the Cayenne. Colorado Plaintiff also alleges that PCNA committed an

unlawful omission under the CCPA by failing to disclose material information to consumers. 

The Court finds that Colorado Plaintiff states a claim under the CCPA on the latter allegation

only. 

To state a CCPA claim, a plaintiff must allege: (1) that the defendant engaged in an

unfair or deceptive trade practice; (2) that the challenged practice occurred in the course of the

defendant’s business, vocation, or occupation; (3) that it significantly impacts the public as

actual or potential consumers of the defendant’s goods, services, or property; (4) that the plaintiff

suffered injury in fact to a legally protected interest; and (5) that the challenged practice caused

the plaintiff’s injury. Crowe v. Tull, 126 P.3d 196, 201 (Colo. 2006) (citing Rhino Linings USA,

Inc. v. Rocky Mountain Rhino Lining, Inc., 62 P.3d 142, 146–47 (Colo. 2003)). Allegations

premised on fraudulent conduct must meet Rule 9(b)’s heightened pleading standard. Duran v.

Clover Club Foods Co., 616 F. Supp. 790, 793 (D. Colo. 1985); Gen. Steel Domestic Sales, LLC

v. Chumley, No. 10-CV-1398, 2011 WL 2415167, at *4 (D. Colo. June 10, 2011). Here, PCNA

40

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 40 of 131 PAGEID #: <pageID>
argues that Colorado Plaintiff has not pleaded a causal connection between PCNA’s alleged

conduct and his damages as required to state a claim under the CCPA.10 

Colorado Plaintiff essentially concedes that his allegations cannot support an inference

that PCNA’s affirmative representations proximately caused his injuries. Instead, he argues that

he incurred damages because his vehicle contained plastic coolant tubes “while [PCNA], at the

same time, represented that the coolant system was ‘extremely robust.’ ” (ECF No. 77, at 166.) 

Without alleging that he heard or had access to PCNA’s affirmative statements, or identifying

the specific statements on which he allegedly relied, Colorado Plaintiff cannot demonstrate

proximate cause under the CCPA. See, e.g., Gen. Steel Domestic Sales, LLC, 2011 WL

2415167, at *4; cf. Crowe, 126 P.3d at 209–10. The Court GRANTS PCNA’s motion to dismiss

Count Five of Plaintiffs’ Complaint to the extent that it is premised on allegations of affirmative

misrepresentations. 

The Court now considers whether PCNA’s alleged failure to disclose the alleged coolant

tube defect to consumers is actionable under the CCPA. One Colorado district court has held

that a plaintiff cannot state an actionable omission under the CCPA unless he or she identifies

some form of communication that took place between the parties. See Baca v. Clark, No. 06-cv00714, 2007 WL 2022054, at *7 (D. Colo. July 9, 2007); see also Warner v. Ford Motor Co.,

No. 06-cv-02442, 2008 U.S. Dist. LEXIS 82858, *36–37 (D. Colo. Sept. 30, 2008) (citing and

distinguishing Baca). In Baca, however, the plaintiff could not establish that the defendant

intended to communicate any facts to her when the defendant did nothing but post a picture of a

10 This argument applies to each of Colorado Plaintiff’s CCPA allegations. Colorado

Plaintiff’s argument that PCNA did not challenge certain allegations because it only cited three

examples of deceptive practices under the statute is without merit. 

41

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 41 of 131 PAGEID #: <pageID>
product on its website. 2007 WL 2022054, at *1–2, 6–7. The defendant therefore did not

misrepresent any material facts when it “failed” to instruct the plaintiff how to properly use the

product. Id. at *6–7.

In contrast, Warner v. Ford Motor Co. and a case on which it relies suggest that the act of

distributing and selling a product constitutes a “statement” to consumers that the product is

reasonably safe for its intended use. 2008 U.S. Dist. LEXIS 82858, at *26–31 (citing Connick v.

Suzuki Motor Co., 675 N.E.2d 584, 595 (Ill. 1996)). In such a case, a defendant’s failure to

disclose defects that present a known safety risk to consumers is an actionable misrepresentation

under the CCPA. See id.; accord Connick, 675 N.E.2d at 595; Daugherty, 51 Cal. Rptr. 3d at

127. When a consumer alleges that he or she would not have purchased the product had the risk

been disclosed, the consumer has alleged facts sufficient to support an inference that the alleged

omission caused his or her injuries. See Warner, 2008 U.S. Dist. LEXIS 82858, at *48; accord

Connick, 675 N.E.2d at 595. 

In Warner, for example, the plaintiffs alleged that the defendant-manufacturer failed to

disclose the fact that the subject vehicle was defectively designed and that the defect posed a

known safety risk to consumers. 2008 U.S. Dist. LEXIS 82858, at *1–4. The plaintiffs asserted

that, had they known of the defect, they would not have purchased the vehicle. Id. The court

found that such an omission was actionable misconduct under the CCPA and that the plaintiffs

had sufficiently alleged that the defendant’s conduct caused their injuries. See id. at *49–50. In

reaching its conclusion, the court relied heavily on Connick v. Ford Motor Co., in which the

Illinois Supreme Court found that a defendant-manufacturer’s alleged concealment of a vehicle’s

susceptibility to rollover was an actionable omission under the Illinois consumer fraud statute. 

42

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 42 of 131 PAGEID #: <pageID>
See Warner, 2008 U.S. Dist. LEXIS 82858, at *27–31. The Connick court similarly found that

the plaintiffs’ allegation that they would not have purchased the vehicle had the safety risk been

disclosed was sufficient to meet the statute’s proximate cause requirement. 675 N.E.2d at 595. 

Although the plaintiffs in both Warner and Connick had received some form of

communication from the defendant, the Court finds that the lack of direct communication

between the parties in this case does not mandate dismissal of Colorado Plaintiff’s claim. The

Colorado Supreme Court has indicated that the CCPA is to be construed broadly and that “it

should ordinarily be assumed that the CCPA applies to the conduct[; t]hat assumption is

appropriate because of the strong and sweeping remedial purpose of the CCPA.” Showpiece

Homes Corp. v. Assur. Co. of Am., 38 P.3d 47, 53 (Colo. 2001); Warner, 2008 U.S. Dist. LEXIS

82858, at *19 (citing Showpiece Homes). Furthermore, the Connick court appeared to accept the

plaintiff’s allegations that “the offering for sale of a consumer product constitutes a

representation that the product is reasonably safe for its intended use,” id. (internal citations

omitted); infra Section IV(F) (Count Fourteen), and the Warner court acknowledged the

similarities between Colorado and Illinois law in this area. See Warner, 2008 U.S. Dist. LEXIS

82858, at *30–31. The Connick court’s holding is also consistent with case law in other

jurisdictions in which courts have held that consumers expect to purchase products that do not

contain safety-related defects such that a defendant acts fraudulently in knowingly concealing

such defects from consumers. See, e.g., Daugherty, 51 Cal. Rptr. 3d at 127. 

Here, Plaintiffs (and Colorado Plaintiff by incorporation) have alleged facts sufficient to

support an inference that the alleged coolant tube defect presents a safety risk to consumers and

that PCNA had knowledge of but failed to disclose this defect to consumers. See supra Section

43

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 43 of 131 PAGEID #: <pageID>
III(B); IV(B) (Count Two). Colorado Plaintiff alleges that he would not have purchased his

Cayenne had the alleged coolant tube defect been disclosed. The Court predicts that the

Colorado Supreme Court would find that these allegations are sufficient to state a claim under

the CCPA. The Court DENIES PCNA’s motion to dismiss these allegations.

Accordingly, the Court GRANTS IN PART and DENIES IN PART PCNA’s motion to

dismiss Count Five of Plaintiffs’ Complaint. 

Count Six: Strict Product Liability (Colorado)

Colorado Plaintiff brings a claim for strict product liability and alleges that PCNA

designed and sold the Cayenne in a defective condition that was unreasonably dangerous to

consumers and/or their property. PCNA argues, and the Court agrees, that the economic loss

doctrine bars any such claim. 

Colorado has adopted the Restatement (Second) of Torts § 402A, which provides the

standard for strict product liability claims. In relevant part, Section 402A states: 

(1) One who sells any product in a defective condition unreasonably dangerous to

the user or consumer or to his property is subject to liability for physical harm

thereby caused to the ultimate user or consumer, or to his property, if

(a) the seller is engaged in the business of selling such a product, and

(b) it is expected to and does reach the user or consumer without substantial

change in the condition in which it is sold.

Restatement (Second) of Torts § 402A (1965); Hiigel v. Gen. Motors Corp., 544 P.2d 983, 989

(Colo. 1975) (adopting § 402A). 

The Colorado Supreme Court initially adopted the view that “property” under Section

402A includes the product itself, such that “damage to the product sold is covered under the

doctrine of strict liability.” Hiigel, 544 P.2d at 989. In Hiigel, the plaintiff sued the

manufacturer of his motor home after the wheels fell off the vehicle, allegedly due to the

44

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 44 of 131 PAGEID #: <pageID>
manufacturer’s failure to warn consumers of the proper way to maintain the vehicle’s wheel

attachment system. Id. at 985. The plaintiff did not sustain physical injuries but sought recovery

for his costs in repairing the vehicle. See id. In allowing the plaintiff’s claim to proceed, the

court noted that jurisdictions were split as to whether plaintiffs could pursue tort claims to

recover economic loss. See id. The court adopted the holding of Santor v. Karagheusian, Inc.,

207 A.2d 305 (N.J. 1965), which allowed a plaintiff to recover in tort when a product contained

a defect that damaged only the product itself. Hiigel, 544 P.2d at 989. The court limited its

holding on this point to cases involving individual (and not commercial plaintiffs). Id. 

Santor has since received substantial criticism and represents the minority view among

courts. See E. River S.S. Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 868–69 (1986)

(classifying Santor as the minority approach and declining to follow it in an admiralty case). 

The majority of courts instead have adopted the holding of Seely v. White Motor Co., in which

the California Supreme Court refused to allow a plaintiff to pursue a strict liability in tort theory

to recover damages for the purchase price of his vehicle. 403 P.2d 145, 151 (Cal. 1965). The

court found that the law draws a boundary between “tort recovery for physical injuries and

warranty recovery for economic loss” and that a “manufacturer’s liability [in tort] is limited to

damages for physical injuries and there is no recovery for economic loss alone.” Id. The court

reasoned that a consumer can contract to protect his or her economic interests but “should not be

charged at the will of the manufacturer with bearing the risk of physical injury.” Id. When a

defective product fails and the only damage is to the product itself, the consumer has suffered

economic loss and may only recover in contract. See id. The United States Supreme Court

adopted Seely’s holding in federal admiralty law and stated that “[e]ven when the harm to the

45

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 45 of 131 PAGEID #: <pageID>
product itself occurs through an abrupt, accident-like event, the resulting loss due to repair costs,

decreased value, and lost profits is essentially the failure of the purchaser to receive the benefit

of its bargain—traditionally the core concern of contract law.” E. River, 476 U.S. at 870–71. 

Twenty-five years after Hiigel, the Colorado Supreme Court joined the majority of

jurisdictions and officially adopted the economic loss rule for cases brought by all plaintiffs,

including individual purchasers. See Town of Alma v. Azco Const., Inc., 10 P.3d 1256, 1259–66

(Colo. 2000). The court cited extensively to Seely and East River and ultimately stated:

[W]e now expressly adopt the economic loss rule. We hold that a party suffering

only economic loss from the breach of an express or implied contractual duty may

not assert a tort claim for such a breach absent an independent duty of care under tort

law.[] Economic loss is defined generally as damages other than physical harm to

persons or property. 

Id. at 1264. 

The Town of Alma court illustrated the rule using a manufacturer’s warranty as an

example. When a product fails outside its warranty and only the product itself is damaged, the

buyer has suffered only economic loss. The buyer could have addressed his or her economic

expectations in contract by “demand[ing] additional warranties on a product while agreeing to

pay a higher price, or the same buyer may choose to assume a higher level of risk that a product

will not perform properly by accepting a more limited warranty in exchange for a lower product

price.” Id. at 1262. If the buyer fails to protect adequately those economic expectations in

contract, he or she cannot then attempt to recover solely economic loss in tort. See id. at

1262–64; cf. Camacho v. Honda Motor Co., 741 P.2d 1240 (Colo. 1987) (considering the merits

of a strict liability claim based on Section 402A where the plaintiff suffered severe leg injuries in

an accident involving an allegedly defective motorcycle). 

46

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 46 of 131 PAGEID #: <pageID>
In its analysis, the Town of Alma court noted that application of the economic loss

doctrine turns on the source of the duty owed and not the nature of the injury suffered. 10 P.3d

at 1262. The court then cited several examples of circumstances in which an individual could

suffer monetary injury but still pursue a tort action based on an independent duty of care that the

defendant violated. Id. at 1263 (citing examples of “special relationships,” such as attorneyclient and physician-patient, that impose a duty of care independently of any contractual

relationship). In other words, the fact that a plaintiff suffers monetary damages does not

necessarily mean that he or she has suffered “economic loss” for purposes of the rule. 

This language does not alter the conclusion that “[d]amage to a product is most naturally

understood as a warranty claim” that could have been insured or otherwise addressed in contract. 

E. River, 476 U.S. at 871; Town of Alma, 10 P.3d at 1262–63 (discussing warranties). When a

product sustains damage that would have been covered under its warranty, but the damage

occurs outside of the warranty period, the damages could have been addressed in contract and

are exactly the kind of damages that the economic loss rule developed to address. See Town of

Alma, 10 P.3d at 1262; Seely, 403 P.2d at 151; Carter v. Brighton Ford, Inc., 251 P.3d 1179,

1183 (Colo. App. 2010) (“Damages occurring only to the product itself represent the type of

damages that can be foreseen and dealt with by contract.”). Absent some damages that would

not have been contemplated under the product’s warranty, the fact that the product is

“unreasonably dangerous” is irrelevant to the question of whether the economic loss rule applies. 

See Town of Alma, 10 P.3d at 1264 (“Economic loss is defined generally as damages other than

physical harm to persons or property.”); accord E. River, 476 U.S. at 871 (rejecting an

intermediate theory in which economic loss is recoverable in tort where “the defective product

47

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 47 of 131 PAGEID #: <pageID>
creates a situation potentially dangerous to persons or other property” and stating that “[t]he tort

concern with safety is reduced when an injury is only to the product itself”); Sherman v. Sea Ray

Boats, 649 N.W.2d 783, 790 (Mich. Ct. App. 2002) (stating that, where a plaintiff seeks only

economic loss and not damages for physical injury, “tort concerns with product safety no longer

apply, and economic expectation issues prevail”). 

Here, is it undisputed that Colorado Plaintiff suffered only economic loss when his

vehicle’s coolant tubes failed. Colorado Plaintiff does not allege that coolant tube failure caused

him to suffer personal injury or injury to property other than his Cayenne;11 instead, the only

damages that he suffered could have been addressed under the vehicle’s Warranty. The duty that

PCNA allegedly breached therefore sounds in contract and Colorado Plaintiff is barred from

pursuing a tort claim for strict product liability. 

 Colorado Plaintiff attempts to confuse the issue by suggesting that PCNA breached a

11The product at issue in this case is the Cayenne and not the individual coolant tubes. To

the extent that Plaintiffs are suggesting otherwise, this suggestion goes against the great weight

of authority. See, e.g., Progressive Ins. Co. v. Sacramento Cnty. Coach Showcase, No.

2:07-CV-10187, 2008 WL 5377993, at *7 (D. Nev. Dec. 23, 2008) (stating that the reasoning

behind the economic loss rule applies when “an integral component of a larger product causes

damage to the product itself because ‘the injury suffered—the failure of the product to function

properly—is the essence of a warranty action[.]’ ” (citation omitted)); Int’l Flavors &

Fragrances Inc. v. McCormick & Co., Inc., 575 F. Supp. 2d 654, 662 (D.N.J. 2008) (“Several

courts have been faced with facts similar to those at bar, and each has concluded that the damage

done to a final product by a defective component or ingredient does not constitute damage to

property ‘other than the product itself.’ ”); Americoach Tours, Inc. v. Detroit Diesel Corp., No.

04-2016, 2005 WL 2335369, at *3 (W.D. Tenn. Sept. 23, 2005) (“In the instant case, MCI . . .

assembled the bus from component parts, and the entire bus . . . was therefore the ‘product

itself.’ ”); Myrtle Beach Pipeline Corp. v. Emerson Elec. Co., 843 F. Supp. 1027, 1059 (D.S.C.

1993) (“[V]irtually all machines have component parts and to distinguish the component part

from the whole would result in a finding of injury to ‘other property’ whenever a product injures

itself.” (citing E. River, 476 U.S. at 868–69)). The Colorado court of appeals’ mention in dicta

of “damage to the product (in addition to the defect),” without more, does not persuasively reject

this line of cases. See Carter, 251 P.3d at 1182–83. 

48

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 48 of 131 PAGEID #: <pageID>
duty to act reasonably in the design, manufacture, and sale of the Cayenne. (ECF No. 77, at 169

(citing Loughridge v. Goodyear Tire and Rubber Co., 192 F. Supp. 2d 1175, 1183–84 (D. Colo.

2002), for the proposition that “strict products liability imposes a duty on the manufacturer of a

product, outside any contractual duty, to act reasonably in the design, manufacture, and sale of

the product”).) Were the Court to apply this principle to the present case, such a holding would

contradict the Colorado Supreme Court’s implicit holding that product damage that could have

been addressed by a warranty is not recoverable in tort. See Town of Alma, 10 P.3d at 1263

(suggesting that the type of damages suffered is relevant in determining the source of the duty

underlying the action); Carter, 251 P.3d at 1183 (rejecting the Loughridge court’s holding that

warranty claims—claims in which the product damaged only itself—constitute “property

damage” within the meaning of Colorado’s product liability statutes). The Loughridge court also

based its ruling on the fact that the plaintiffs had alleged harm to property other than the product

itself; such a circumstance is not present in this case. See 192 F. Supp. 2d at 1184. 

Colorado Plaintiff’s final argument is that Hiigel has never been overruled and precludes

application of the economic loss doctrine in this case. Colorado Plaintiff does not explain how

Hiigel would support a tort action on these facts that would not contradict the theory of and

purposes underlying the economic loss rule that the Town of Alma court espoused. See Carter,

251 P.3d at 1183 (finding that, at the very least, Hiigel has been “substantially narrowed and

clarified” by Town of Alma). Colorado Plaintiff notes that the plaintiff in Town of Alma was in

privity with the defendant, that the contract in Town of Alma covered the “specific subject matter

of the lawsuit,” that the issue arose in the negligence context and not strict product liability, and

that the defect did not pose safety risks. (ECF No. 77, at 169.) None of these distinctions alter

49

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 49 of 131 PAGEID #: <pageID>
the Court’s conclusion that, because Colorado Plaintiff seeks purely economic loss that he could

have addressed by purchasing extended warranty coverage in contract, he cannot now attempt to

recover those damages in tort. 

The Court finds that the economic loss rule bars Colorado Plaintiff’s tort claim for strict

product liability. Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Six of

Plaintiffs’ Complaint. 

Count Seven: Implied Warranty of Merchantability (Colorado)

Colorado Plaintiff brings a claim for breach of implied warranty of merchantability under

Colorado law. Like his co-plaintiffs, Colorado Plaintiff asserts that PCNA breached the implied

warranty of merchantability under the UCC by failing to supply goods that are fit for their

ordinary purpose. 

PCNA does not offer any arguments specific to Colorado Plaintiff’s implied warranty

claim and adopts only those arguments that it advanced in connection with Plaintiffs’ MagnusonMoss claim. Specifically, PCNA argues that all implied warranties had expired by the time the

alleged defect manifested in Colorado Plaintiff’s vehicle. The Court rejected these arguments in

Section IV(A)(2)(b) of this Opinion and Order (Count One) and found that Plaintiffs had

sufficiently alleged facts to suggest that the durational limitation on all implied warranties was

unconscionable and unenforceable, such that the Court cannot assume for purposes of this

motion that the implied warranty of merchantability had expired. See supra Section IV(A)(2)(b)

(Count One). The Court therefore finds that Colorado Plaintiff states a claim for breach of the

implied warranty of merchantability. The Court DENIES PCNA’s motion to dismiss Count

Seven of Plaintiffs’ Complaint. 

50

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 50 of 131 PAGEID #: <pageID>
D. FLORIDA 

Florida Plaintiff Joseph Dudley purchased a 2004 Cayenne from an unidentified seller

sometime in 2010. That same year, Florida Plaintiff became aware that the plastic coolant tubes

in his vehicle “faced defective coolant tube issues” and paid to replace the plastic tubes in order

to avoid having the defect manifest in his vehicle. (ECF No. 35, at 20.) Florida Plaintiff now

brings claims for violations of the Florida Deceptive and Unfair Trade Practices Act

(“FDUTPA”), Fla. Stat. § 501.201 et seq., negligence, and unjust enrichment. PCNA moves to

dismiss each of these claims. 

Count Eight: Florida’s Deceptive and Unfair Trade Practices Act

Under the FDUTPA, “[u]nfair methods of competition, unconscionable acts or practices,

and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby

declared unlawful.” Fla. Stat.§ 501.204(1). A person who has suffered a loss as a result of an

FDUTPA violation may recover “actual damages, plus attorney’s fees and court costs.” Id. §

501.211. There are three elements to an FDUTPA claim: (1) a deceptive or unfair practice, (2)

causation, and (3) actual damages. Rollins, Inc. v. Butland, 951 So. 2d 860, 869 (Fla. Dist. Ct.

App. 2006). 

Here, the parties dispute whether Florida Plaintiff has alleged causation and actual

damages as required to state a claim under the FDUTPA. Florida courts have defined “actual

damages” as “the difference in the market value of the product or service in the condition in

which it was delivered and its market value in the condition in which it should have been

delivered according to the contract of the parties.” Butland, 951 So. 2d at 869 (citing Rollins,

Inc. v. Heller, 454 So. 2d 580, 585 (Fla. Dist. Ct. App. 1984)). Florida Plaintiff seeks to recover

51

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 51 of 131 PAGEID #: <pageID>
two types of actual damages: the cost of replacing the plastic coolant tubes in his vehicle with

aluminum pipes and the amount that he overpaid in purchasing what he assumed to be a nondefective vehicle. Under the latter theory, Florida Plaintiff seeks to recover the diminished value

of his vehicle, measured as the difference between the value of a Cayenne equipped with nondefective parts and the value of the Cayenne as delivered. PCNA argues that Florida Plaintiff

cannot claim actual damages where the vehicle was delivered in a condition that outlived its

express warranty, and, alternatively, that Florida Plaintiff fails to allege actual damages because

he installed aluminum pipes in his vehicle before the plastic coolant tubes failed. 

The Court agrees with PCNA that Florida Plaintiff cannot recover under the FDUTPA

the cost of repairing and replacing the allegedly defective coolant tubes in his vehicle. Florida

courts have suggested that the cost of repairing and replacing a defective part are

“consequential” damages that are not recoverable under the FDUTPA and that the FDUTPA

permits a consumer to recover “only the diminished value” of the goods or services received. 

Orkin Exterminating Co. v. Petsch, 872 So. 2d 259, 263 (Fla. Dist. Ct. App. 2004) (citing Urling

v. Helms Exterminators, Inc., 468 So. 2d 451, 454 (Fla. Dist. Ct. App. 1985)); see also Kia

Motors Am. Corp. v. Butler, 1140 (Fla. Dist. Ct. App. 2008) (finding that, in a case in which the

plaintiff paid to repair and replace the allegedly deceptive brakes in her vehicle, the plaintiff

sought recovery of consequential damages that are not recoverable under the FDUTPA);

Butland, 951 So. 2d at 869. 

Here, Florida Plaintiff alleges actual damages under the FDUTPA on a “diminished

value” theory of recovery. A district court in Florida recently found that a plaintiff pleaded the

elements of an FDUTPA claim on facts similar to those that Florida Plaintiff alleges in this case. 

52

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 52 of 131 PAGEID #: <pageID>
In Matthews v. American Honda Motor Co., Inc., the plaintiff alleged that the defendant

manufactured and sold vehicles with a latent defect and brought a FDUTPA claim on behalf of

herself and all Florida owners and lessees of the subject vehicles. No. 12-60630-CIV, 2012 WL

2520675, at *1 (S.D. Fla. June 6, 2012). The plaintiff alleged that the defect caused paint

discoloration and delamination on the outside of the vehicles, that the defect did not manifest

until after the applicable warranties on the vehicles had expired, and that the defendant was

aware of the defect but failed to disclose it to the public at large. Id. In finding that the plaintiff

adequately pleaded the elements of an FDUTPA claim,12 the court stated that “Florida courts

have recognized that a[n] FDUTPA claim is stated where the defendant knowingly fails to

disclose a material defect that diminishes a product’s value.” Id. at *3 (citing Davis v. Powertel,

Inc., 776 So. 2d 971, 973 (Fla. Dist. Ct. App. 2000)). The court went on to reject the defendant’s

argument that the vehicle’s warranty barred the claim, stating, “[plaintiff’s] allegation that

[defendant] knowingly failed to disclose the latent paint defect takes this case outside of

warranty law.” Id. 

Florida case law supports the Matthews court’s holding that a consumer can recover

under the FDUTPA when a defendant’s deceptive conduct allegedly diminishes the value of the

product sold. See Siegle v. Progressive Consumers Ins. Co., 819 So. 2d 732, 738 (Fla. 2002)

(indicating that the FDUTPA contemplates compensation for diminished value); Davis, 776 So.

2d at 990 (reversing a trial court’s dismissal of a putative class action when the plaintiffs alleged

that the defendant’s failure to disclose a material fact reduced the value of their phones); Ft.

12The court found that the plaintiff had adequately pleaded the elements of a FDUTPA

claim but ultimately dismissed the claim without prejudice on statute of limitations grounds. See

id. at *3–5. PCNA does not make a statute of limitations argument under the FDUTPA in this

case. 

53

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 53 of 131 PAGEID #: <pageID>
Lauderdale Lincoln Mercury v. Corgnati, 715 So. 2d 311, 314 (Fla. Dist. Ct. App. 1998). In a

case with facts similar to those alleged here, a Florida court of appeals allowed a plaintiff’s

FDUTPA claim to proceed where she allegedly purchased a vehicle that came equipped with

defective seat belts and sought to recover the “diminution in value of her [] automobile caused

by the allegedly defective seatbelt buckles.” Collins v. DaimlerChrysler Corp., 894 So. 2d 988,

990–91 (Fla. Dist. Ct. App. 2004). The Collins court suggested that the appropriate measure of

damages under the FDUTPA would be the difference in value between the car sold with

operational seat belts and the car sold with defective seat belts. Id. at 991. 

Importantly, the Collins court allowed the plaintiff’s claim to proceed despite the fact that

the alleged seat belt defect had never manifested itself by failing to operate in an emergency or

otherwise causing injury. Id. at 990–91. The court noted that the case was unique in that seat

belts present safety and reliability concerns such that the plaintiff had alleged a concrete injury

even though the defect had never manifested in her vehicle. Id. 

For the reasons set forth in Section IV(B) (Count Two) of this Opinion and Order, the

Court assumes for purposes of this motion to dismiss that the alleged coolant tube defect

presents a safety risk to consumers. Thus, in light of Collins, PCNA’s argument that Florida

Plaintiff alleges only speculative damage because he replaced his coolant tubes before the

alleged defect manifested in his vehicle is not persuasive.

Similarly unpersuasive is any attempt to distinguish the Collins court’s holding from the

facts of this case on the ground that Florida Plaintiff did not rely on PCNA’s affirmative

representations in purchasing his vehicle. The Court acknowledges the fact that the FDUTPA’s

actual damages inquiry is premised on the “contract of the parties,” Butland, 951 So. 2d at 869,

54

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 54 of 131 PAGEID #: <pageID>
and that the Florida courts confronting this issue have measured damages in accordance with the

defendant’s affirmative representations regarding the quality of its product. See, e.g., Collins,

894 So. 2d at 990–91; Corgnati, 715 So. 2d at 312; H & J Paving of Florida, Inc. v. Nextel, Inc.,

849 So. 2d 1099, 1102 (Fla. Dist. Ct. App. 2003). But the Matthews court applied this measure

of damages to a case in which the plaintiff did not rely on any of the defendant’s express

representations, and Collins does not rule out the theory that a defendant’s failure to disclose

defects that implicate safety concerns is actionable regardless of whether the defendant

affirmatively represented the fact that its product would operate safely. See Matthews, 2012 WL

2520675, at *1–3; Collins, 894 So. 2d at 991 n.3; accord Decker, 2011 WL 5101705, at *4;

Connick, 675 N.E.2d at 584. The Court declines to dismiss Florida Plaintiff’s claim on this

ground.

Given the above analysis, PCNA’s argument that Florida Plaintiff fails to allege

causation is not compelling. Florida Plaintiff alleges that, had he known of the alleged coolant

tube defect, he would not have purchased a Cayenne or would have insisted on paying less for it. 

(ECF No. 35 ¶ 113.) These allegations are sufficient to demonstrate cause under the FDUTPA. 

See, e.g., Davis, 776 So. 2d at 973–75; Matthews, 2012 WL 2520675, at *2–3. PCNA’s

argument that Florida Plaintiff must allege “transaction-specific facts” in order to demonstrate

causation under the FDUTPA is misleading; this language was relevant in a class certification

procedure in which the allegedly deceptive conduct depended on the facts of each individual

transaction. Miami Auto. Retail, Inc. v. Baldwin, No. 3D10-2136, 2012 WL 2402152, at *1, 8

(Fla. Dist. Ct. App. June 27, 2012). In Miami Automotive Retail, the court distinguished cases in

which “every customer received the same misrepresentation” and stated that, in such cases,

55

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 55 of 131 PAGEID #: <pageID>
“individual reliance may not be necessary under FDUTPA.” Id. at *8. PCNA’s argument does

not mandate dismissal of Florida Plaintiff’s claim. 

The Court finds that Florida Plaintiff states a claim for relief under the FDUTPA. 

Accordingly, the Court DENIES PCNA’s motion to dismiss Count Eight of Plaintiffs’

Complaint. 

Count Nine: Negligence (Florida)

Florida Plaintiff alleges that PCNA “owed a duty to [Florida Plaintiff] with regard to the

plastic coolant tubes installed in the subject Porsche Cayenne vehicles.” (ECF No. 35 ¶ 309.) 

Florida Plaintiff asserts that PCNA breached this duty by negligently designing the Cayenne’s

cooling system in such a way as to cause injury to Florida Plaintiff. 

 In Florida, as in Colorado, the economic loss rule prevents plaintiffs from recovering

under a negligence claim “when there is a defect in a product that causes damage to the product

but causes no personal injury or damage to other property.” Indem. Ins. Co. v. Am. Aviation,

Inc., 891 So. 2d 532, 536 (Fla. 2004). The Florida Supreme Court has stated that “the products

liability economic loss rule developed to protect manufacturers from liability for economic

damages caused by a defective product beyond those damages provided by warranty law.” Id. at

538. 

Florida Plaintiff does not dispute this contention but instead argues that the rule does not

bar tort claims based on fraudulent inducement and negligent misrepresentation. Even if true,

Florida Plaintiff does not explain how this fact is relevant to his claim that PCNA negligently

designed the Cayenne. Florida Plaintiff was free to plead a claim for fraudulent inducement or

negligent misrepresentation if the facts supported such a claim for relief. He failed to do so, and

56

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 56 of 131 PAGEID #: <pageID>
cannot amend his claim in his memorandum in opposition. See, e.g., Pa. ex rel. Zimmerman, 836

F.2d 173, 181 (3d Cir. 1988) (“[I]t is axiomatic that the complaint may not be amended by the

briefs in opposition to a motion to dismiss.” (internal quotations omitted)). As it stands, the

Complaint fails to provide sufficient notice of a fraudulent inducement or negligent

misrepresentation claim such that PCNA could have prepared an informed responsive pleading. 

As for the negligent design claim, Florida Plaintiff does not dispute the fact that the

alleged coolant defect caused damage to the Cayenne and not personal injury or damage to other

property. Thus, the Court finds that the economic loss doctrine, as recognized by Florida courts,

bars Florida Plaintiff’s negligent design claim. The Court GRANTS PCNA’s motion to dismiss

Count Nine of Plaintiffs’ Complaint. 

Count Ten: Unjust Enrichment (Florida)

Florida Plaintiff brings a claim for unjust enrichment and alleges that “[PCNA] charged

[Florida Plaintiff] and other Florida Sub-Class members more than a fair market price for their

vehicles” such that it would be “inequitable” for PCNA to retain the benefit without paying the

value of the benefit conferred. (ECF No. 35 ¶¶ 314, 316.) Florida Plaintiff alleges that he

conferred a benefit on PCNA, “which it appreciated when it received the monetary compensation

for the Cayennes and other benefits conferred.” (Id. ¶ 313.) The Court finds that Florida

Plaintiff fails to state a claim for unjust enrichment. 

Unjust enrichment is an “equitable claim based on a legal fiction which implies a contract

as a matter of law.” 14th & Heinberg, LLC v. Terhaar & Cronley Gen. Contractors, Inc., 43 So.

3d 877, 880 (Fla. Dist. Ct. App. 2010). In order to state a claim for unjust enrichment in Florida,

a plaintiff must allege that he or she “directly conferred a benefit on the defendants.” Am. Safety

57

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 57 of 131 PAGEID #: <pageID>
Ins. Serv., Inc. v. Griggs, 959 So. 2d 322, 331 (Fla. Dist. Ct. App. 2007) (citing Peoples Nat’l

Bank of Commerce v. First Union Nat’l Bank of Fla., 667 So. 2d 876, 879 (Fla. Dist. Ct. App.

1996)). The parties need not be in privity of contract in order for a plaintiff to establish that he

or she conferred a direct benefit on a defendant; however, a plaintiff cannot recover for unjust

enrichment in Florida when he or she purchased a product on the secondary market with no

direct link to the manufacturer. Compare Romano v. Motorola, Inc., No. 07-CIV-60517, 2007

WL 4199781, at *2 (S.D. Fla. Nov. 26, 2007) (refusing to dismiss a plaintiff’s unjust enrichment

claim where the plaintiff purchased a product through a manufacturer’s “retail outfit” and stating

that “[w]hile the [product] is ultimately sold through the retailer, [the defendant] is directly

benefitted through profits earned from the sale of the [product]”) with Doll v. Ford Motor Co.,

814 F. Supp. 2d 526, 551–52 (D. Md. 2011) (dismissing an unjust enrichment claim under

Florida law where the plaintiff purchased a used Ford vehicle from an independent dealership

and finding that the plaintiffs failed to demonstrate that the defendant received a direct benefit

from the transaction). See also Szymczak v. Nissan N. Am., Inc., No. 10 CV 7493, 2011 U.S.

Dist. LEXIS 153011, at *58–59 (S.D.N.Y. Dec. 16, 2011) (dismissing a Florida plaintiff’s unjust

enrichment claim because he failed to allege that he purchased a product from or otherwise

conferred a direct benefit on the defendant). 

Here, Florida Plaintiff alleges that he purchased a 2004 vehicle in 2010 and that he

replaced the plastic coolant tubes in his vehicle. Florida Plaintiff alleges only that he “bought

and/or leased a Porsche Cayenne manufactured by Porsche” and that PCNA “received the

monetary compensation for the Cayennes and other benefits conferred by Plaintiff[] Dudley . . .

and the other Florida Sub-Class members.” (ECF No. 35 ¶ 313.) Without establishing a link

58

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 58 of 131 PAGEID #: <pageID>
between the unidentified seller of his vehicle and PCNA, Florida Plaintiff fails to allege that he

conferred a direct benefit on PCNA as Florida law requires. See Doll, 814 F. Supp. 2d at

551–52; Peoples Nat’l Bank of Commerce, 667 So. 2d at 879. Accordingly, Florida Plaintiff’s

unjust enrichment claim against PCNA cannot survive. 

As an alternative rationale for dismissing Florida Plaintiff’s unjust enrichment claim, the

Court notes that several district courts in Florida have held that a plaintiff cannot advance an

unjust enrichment claim that is predicated on the same wrongful conduct as that which the

FDUTPA is designed to prevent. See Matthews, 2012 WL 2520675, at *2; Jovine v. Abbott

Labs., Inc., 795 F. Supp. 2d 1331, 1341–42 (S.D. Fla. 2011); Nichols v. Wm. Wrigley Jr. Co.,

No. 10-80759-CIV, 2011 WL 181458, at *5 (S.D. Fla. Jan. 19, 2011); Prohias v. Pfizer, Inc.,

490 F. Supp. 2d 1228, 1236–37 (S.D. Fla. 2007); Am. Honda Motor Co., Inc. v. Motorcycle Info.

Network, Inc., 390 F. Supp. 2d 1170, 1178 (M.D. Fla. 2005). The purpose of the FDUTPA is to

protect the consuming public from those who engage in unfair methods of competition and/or

unconscionable, deceptive, or unfair acts or practices in the conduct of trade of commerce. Fla.

Stat. § 501.202(2). Thus, where a plaintiff alleges that a defendant engaged in deceptive trade

practices, the plaintiff has an adequate remedy at law even if his or her FDUTPA claim is

ultimately unsuccessful. See Matthews, 2012 WL 2520675, at *2, 5; In re Managed Care Litig.,

185 F. Supp. 2d 1310, 1337 (S.D. Fla. 2002) (“It is blackletter [sic] law that the theory of unjust

enrichment is equitable in nature and is, therefore, not available where there is an adequate legal

remedy.” (internal citations omitted)). 

Here, Florida Plaintiff does not assert that his unjust enrichment claim is predicated on

allegations that are distinct from those underlying his FDUTPA claim. Florida Plaintiff therefore

59

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 59 of 131 PAGEID #: <pageID>
has an adequate remedy at law and is barred from advancing an unjust enrichment claim in this

case. See Matthews, 2012 WL 2520675, at *2, 5. 

The Court finds that Florida Plaintiff fails to state a claim for unjust enrichment. 

Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Ten of Plaintiffs’

Complaint. 

E. GEORGIA 

Georgia Plaintiff Anthony Gardner purchased a 2005 Cayenne in 2008 from an

unidentified seller. Georgia Plaintiff does not disclose the amount that he paid for his Cayenne

or any other circumstances surrounding the purchase. Georgia Plaintiff alleges that, in March

2011, the plastic coolant tubes in his vehicle cracked and rendered his vehicle disabled. Georgia

Plaintiff paid to repair his vehicle and now brings claims for breach of implied warranty under

the UCC, violations of Georgia’s Uniform Deceptive Trade Practices Act, Ga. Code Ann. § 10-

1-370 et seq., and unjust enrichment. PCNA moves to dismiss these claims. 

Count Eleven: Implied Warranty of Merchantability Under UCC (Georgia)

In Georgia, a warranty that goods shall be merchantable is implied in a contract for their

sale if the seller is a merchant with respect to goods of that kind. Ga. Code Ann. § 11-2-314

(adopting UCC § 2-314 as Georgia law). A plaintiff seeking to assert a claim for breach of the

implied warranty of merchantability under Georgia law must be in privity with the party against

whom the plaintiff seeks to assert his or her claim. Keaton v. A.B.C. Drug Co., 467 S.E.2d 558,

560–61 (Ga. 1996); Chaffin v. Atlanta Coca Cola Bottling Co., 194 S.E.2d 513, 514 (Ga. Ct.

App. 1972). Georgia courts have consistently held that, “if a defendant is not the seller to the

plaintiff-purchaser, the plaintiff as the ultimate purchaser cannot recover on the implied []

60

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 60 of 131 PAGEID #: <pageID>
warranty, if any, arising out of the prior sale by the defendant to the original purchaser, such as

[the] distributor or retailer from whom plaintiff purchased the product.” Evershine Prods., Inc.

v. Schmitt, 202 S.E.2d 228, 231 (Ga. Ct. App. 1973). 

Georgia Plaintiff does not argue that he is in privity with PCNA but argues that Georgia

courts recognize an exception to this rule where a manufacturer extends a warranty to a remote

purchaser. The Court disagrees and finds that Georgia Plaintiff fails to state a claim for breach

of the implied warranty of merchantability.

Georgia Plaintiff’s argument relies on language from a case in which a Georgia appellate

court stated: 

While ordinarily under [Georgia law] there is no implied warranty existing

between a manufacturer and an ultimate consumer, this is due to the fact that no

privity of contract exists between the two. However, where an automobile

manufacturer, through its authorized dealer issues to a purchaser of one of its

automobiles from such dealer admittedly as a part of the sale a warranty by the

manufacturer running to the purchaser, privity exists . . . .

Chrysler Corp. v. Wilson Plumbing Co., Inc., 208 S.E.2d 321, 323 (Ga. Ct. App. 1974) (citing

Studebaker Corp. v. Nail, 62 S.E.2d 198, 202 (Ga. Ct. App. 1950)); see also McQueen v. Minolta

Bus. Solutions, 620 S.E.2d 391, 393 (Ga. Ct. App. 2005) (“[W]hen a buyer purchases a product

from a retailer, and there is no privity of contract between the manufacturer and the buyer, no

implied warranty runs from the manufacturer to the purchaser.”). At least one district court in

Georgia has cited Chrysler Corp. and allowed an express warranty to supplant the privity

requirement in a plaintiff’s implied warranty of merchantability claim. See Terrill v. Electrolux

Home Prods., Inc., 753 F. Supp. 2d 1272, 1288 (S.D. Ga. 2010).13

13 PCNA indicates that district courts in Georgia are split over this issue. Although there

exist some post-Chrysler Corp. cases in which courts did not allow a warranty to supplant privity

requirements, see Monticello v. Winnebago Indus., Inc., 369 F. Supp. 2d 1350, 1360–61 (N.D.

61

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 61 of 131 PAGEID #: <pageID>
The Court accepts Chrysler Corp. as good law but finds that the “exception” does not

apply to the facts of this case. The Chrysler Corp. court stated that a warranty supplants privity

in certain circumstances—specifically, when a manufacturer issues a warranty to remote

purchasers through an authorized dealer and when the warranty is part of the remote consumer’s

purchase. 208 S.E.2d at 323. This language is not superfluous. Instead, prior and subsequent

cases suggest that this proposition is less an exception and more a means of implying privity

where the sale is effectively a direct sale between the manufacturer and the consumer. See, e.g.,

Studebaker Corp., 62 S.E.2d at 202 (stating that a purchase through an authorized dealer is “in

effect a direct purchase” between the manufacturer and a remote purchaser); Lauria v. Ford

Motor Co., 312 S.E.2d 190, 192–94 (citing Chrysler Corp. and stating that, “[w]here an

automobile manufacturer, through its authorized dealer, issues to a purchaser of one of its new

automobiles from the dealer a warranty as part of the sale, certainly an implied warranty of

merchantability is in effect despite the lack of actual privity”). By acting through a dealer and by

making the warranty part of the sale between the dealer and purchaser, the manufacturer evinces

an intent to contract with the remote purchaser and receives consideration in the form of direct

profits from its dealers. Studebaker Corp., 62 S.E.2d at 201–02. The manufacturer therefore

bridges the privity gap that would otherwise bar the remote purchaser’s implied warranty claim. 

See id. 

Georgia Plaintiff does not allege any facts suggesting that his purchase transaction was

effectively a sale between himself and PCNA. Georgia Plaintiff does not allege that he

Ga. 2005) and Whitehead v. John Bleakley RV Ctr., No. 1:09-CV-468, 2010 WL 925091, at *7

(N.D. Ga. Mar. 8, 2010), neither of these courts cited Chrysler Corp. or appear to have directly

confronted this argument. 

62

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 62 of 131 PAGEID #: <pageID>
purchased his vehicle new (instead, he purchased a 2005 vehicle in 2008) from a Porsche

authorized dealer (he does not identify the seller) or that the unidentified seller incorporated the

Warranty into his purchase of the vehicle. Even assuming all facts alleged in the Complaint as

true, the Court cannot conclude that PCNA effectively bridged the privity gap between itself and

Georgia Plaintiff. See Twombly, 550 U.S. at 556 (stating that a complaint that fails to “raise the

claimed right to relief above the speculative level and to create a reasonable expectation that

discovery will reveal evidence to support the claim” does not survive a motion to dismiss). 

Georgia’s general privity rule therefore applies. Georgia Plaintiff acknowledges that he is not in

privity with PCNA; thus, Georgia Plaintiff is barred from pursuing his implied warranty claim. 

The Court GRANTS PCNA’s motion to dismiss Count Eleven of Plaintiffs’ Complaint. 

Count Twelve: Georgia’s Uniform Deceptive Trade Practices Act 

Georgia’s Uniform Deceptive Trade Practices Act (“GUDTPA”) provides that “[a]

person likely to be damaged by a deceptive trade practice of another may be granted an

injunction against it under the principles of equity and on terms that the court considers

reasonable.” Ga. Code Ann. § 10-1-373(a). Georgia Plaintiff does not dispute the fact that the

“sole remedy available under the [GUDTPA] is injunctive relief.” Moore-Davis Motors, Inc. v.

Joyner, 556 S.E.2d 137, 140 (Ga. Ct. App. 2001). As such, the GUDTPA provides relief from

future wrongful conduct and does not rectify past injuries. See, e.g., Catrett v. Landmark Dodge,

Inc., 560 S.E.2d 101, 106 (Ga. Ct. App. 2002). 

Georgia Plaintiff has already repaired the alleged coolant tube defect in his vehicle and

does not suggest that he will experience future wrongful conduct. Instead, without citing any

authority, Georgia Plaintiff argues that currently unnamed class members could suffer harm

63

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 63 of 131 PAGEID #: <pageID>
absent injunctive relief. This argument fails. An individual that has only suffered past harm,

even when he brings his claim on behalf of a putative class of plaintiffs, fails to state a claim

under the GUDPTA. See Bolinger v. First Multiple Listing Serv., Inc., No. 2:10-CV-211-RWS,

2012 U.S. Dist. LEXIS 5767, at *65 (N.D. Ga. Jan. 18, 2012); Terrill, 753 F. Supp. 2d at

1291–92; see also J&R Mktg., 549 F.3d at 390. 

Because Georgia Plaintiff does not allege any future harm that he will likely experience,

an injunction is not warranted and Georgia Plaintiff fails to state a claim under the GUDTPA. 

The Court GRANTS PCNA’s motion to dismiss Count Twelve of Plaintiffs’ Complaint. 

Count Thirteen: Unjust Enrichment (Georgia)

In Georgia, unjust enrichment is an equitable concept that applies when, in the absence of

a legal contract, one party has conferred a benefit on the opposing party for which it should be

compensated. Wachovia Ins. Servs., Inc. v. Fallon, 682 S.E.2d 657, 665 (Ga. Ct. App. 2009). A

party is precluded from pursuing an unjust enrichment claim where a valid contract governs the

subject matter in dispute. Tuvim v. United Jewish Cmty., Inc., 680 S.E.2d 827, 829–30 (Ga.

2009); Goldstein v. The Home Depot, U.S.A., Inc., 609 F. Supp. 2d 1340, 1347 (N.D. Ga. 2009). 

When a consumer seeks compensation for a defective product that failed, the warranty covers the

subject matter in dispute and an unjust enrichment claim does not lie. See, e.g., Terrill, 753 F.

Supp. 2d at 1291. A plaintiff cannot use an unjust enrichment claim to alter or expand the terms

of an express warranty that covers the product that is the subject of his or her claim. Id. 

Georgia Plaintiff’s Cayenne is subject to the terms of the 2005 Warranty. The 2005

Warranty defines PCNA’s obligation to reimburse consumers for parts that are defective in

material or workmanship. (ECF No. 62-5, at 6 (“[PCNA] will repair or replace with a new or

64

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 64 of 131 PAGEID #: <pageID>
remanufactured part . . . any factory-installed part that is defective in material or workmanship

under normal use . . . Warranty repairs will be made free of charge for parts and labor at an

authorized Porsche dealership.”).) Georgia Plaintiff argues that, because his vehicle contained a

part that is defective in material, he is entitled to recoup some of the cost that he paid for his

vehicle or obtain reimbursement for the cost of repairing and replacing the defective part. 

Allowing such recovery would effectively expand the duration and scope of the 2005 Warranty,

which is not an appropriate use of an unjust enrichment claim. See Terrill, 753 F. Supp. 2d at

1291. 

Georgia Plaintiff’s sole argument regarding the 2005 Warranty’s application to this case

is that he is entitled to plead his unjust enrichment claim in the alternative to his “warrantybased” claims. (ECF No. 77, at 88.) This argument is not well taken. A plaintiff may bring an

unjust enrichment claim in the alternative to a breach of contract claim if and only if the validity

or existence of the subject contract is in dispute. See Terrill, 753 F. Supp. 2d at 1291 (citing

Goldstein, 609 F. Supp. 2d at 1347). Georgia Plaintiff does not contend that the validity or

existence of the Cayenne’s express warranty, which defines PCNA’s obligation to reimburse

consumers for defective parts, is in dispute in this case. That Georgia Plaintiff “makes no

concessions regarding the validity of PCNA’s warranty” or that he also asserts a claim for breach

of implied warranty does not alter this conclusion. (ECF No. 77, at 88.) 

Even if the 2005 Warranty did not cover the subject matter of Georgia Plaintiff’s unjust

enrichment claim, his claim is fatally flawed. In Georgia, a plaintiff bringing a claim for unjust

enrichment must have acted “with the expectation that the other will be responsible for the cost.” 

Morris v. Britt, 620 S.E.2d 422, 424 (Ga. Ct. App. 2005). Allegations that one party “engaged in

65

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 65 of 131 PAGEID #: <pageID>
a wrongful act and profited by it, and that that profit came partially at the expense of Plaintiff . . .

is not the basis for a claim of unjust enrichment.” Hernandez Auto Painting & Body Works, Inc.

v. State Farm Mut. Auto. Ins. Co., No. CV408-256, 2009 U.S. Dist. LEXIS 83669, at *16 (S.D.

Ga. Sept. 14, 2009). If the Warranty did not cover the subject matter of Georgia Plaintiff’s claim,

then he would have had no basis to expect that PCNA would be responsible for his costs. The

gravamen of Georgia Plaintiff’s claim would simply be that PCNA engaged in a wrongful act and

profited at his expense, which is insufficient to support a claim for unjust enrichment in Georgia. 

See id.; see also Terrill, 753 F. Supp. 2d at 1291. 

The Court finds that Georgia Plaintiff fails to state a claim for unjust enrichment. 

Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Thirteen of Plaintiffs’

Complaint.

F. ILLINOIS

Illinois Plaintiff Scott Florez purchased a 2004 Cayenne in 2009 from an unidentified

seller. In 2011, the plastic coolant tubes in Illinois Plaintiff’s vehicle failed and rendered his

vehicle disabled. Illinois Plaintiff paid to repair his vehicle and now brings claims for violations

of the Illinois Consumer Fraud and Deceptive Practices Act (“ICFA”), 815 Ill. Comp. Stat. 505/1

et seq., and for unjust enrichment under Illinois law. PCNA moves to dismiss both claims. 

Count Fourteen: Illinois Consumer Fraud and Deceptive Practices Act

 The ICFA proscribes “[u]nfair methods of competition and unfair or deceptive acts or

practices, including but not limited to the use or employment of any deception, fraud, false

pretense, false promise, misrepresentation or the concealment, suppression or omission of any

material fact.” 815 Ill. Comp. Stat. 505/2. The Illinois Supreme Court has held that a plaintiff

may recover under the ICFA for unfair as well as deceptive conduct. Robinson v. Toyota Motor

66

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 66 of 131 PAGEID #: <pageID>
Credit Corp., 775 N.E.2d 951, 960 (Ill. 2002). 

Illinois Plaintiff purports to bring claims for both unfair conduct and deceptive practices

under the ICFA. This distinction is important because claims for “unfairness” need only meet the

notice pleading standard of Rule 8(a), while claims for “deceptive practices” must meet the

heightened pleading standard of Rule 9(b). Windy City Metal Fabricators & Supply, Inc. v. CIT

Tech Fin. Servs., 536 F.3d 663, 670 (7th Cir. 2008); Greenberger v. Geico Gen. Ins. Co., 631

F.3d 392, 399 (7th Cir. 2011). 

The Court finds that Illinois Plaintiff has asserted a claim for deceptive practices only. 

Other courts have recognized that a plaintiff cannot rely on the same allegations to plead both

deceptive and unfair practices. See, e.g., Pirelli Armstrong Tire Corp. v. Walgreen Co., No. 09 C

2046, 2010 WL 624709, at *7 (N.D. Ill. Feb. 18, 2010) (“[I]f adding an allegation of unfairness to

every allegation of fraud required a fall-back to the more relaxed pleading standard under Rule

8(a), then all consumer fraud cases would be pleaded with these words and be subject to the less

stringent standard.”), aff’d, 631 F.3d 436 (7th Cir. 2011). Instead, courts look to the gravamen of

the complaint; if the allegations are predicated upon concealment, omission, or misrepresentation,

the complaint is grounded in fraud and Rule 9(b) applies. Id. at *6; Pirelli, 631 F.3d at 446–47

(“[T]he dictates of Rule 9(b) apply to allegations of fraud, not claims of fraud.”). 

Here, Illinois Plaintiff’s allegations are grounded in fraud, and he does not advance any

allegations of unfair conduct that are distinct from his allegations of fraudulent misrepresentations

and omissions. See ECF No. 35 ¶ 5 (“[PCNA’s] uniform failure to disclose this defect constitutes

both an actionable misrepresentation and an unfair, unlawful, fraudulent and deceptive business

practice . . . .”). Compare Pirelli, 631 F.3d at 447 (finding that the plaintiff’s allegations of

67

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 67 of 131 PAGEID #: <pageID>
“unfair conduct” were really those of “fraud predicated on either a misrepresentation or an

omission”) with Demitro v. Gen. Motors Acceptance Corp., 902 N.E.2d 1163, 1168–69 (Ill. App.

Ct. 2009) (holding that the plaintiff stated a claim for unfair practices under the ICFA where the

defendant allegedly repossessed a vehicle by mistake but refused to return it until the plaintiff

paid his outstanding balance). Illinois Plaintiff’s attempt to evade the pleading requirements of

Rule 9(b) therefore fails. 

 The Court turns to Illinois Plaintiff’s allegations of deceptive acts. To plead an ICFA

claim based on deceptive acts, a plaintiff must allege: (1) a deceptive act or practice by the

defendant, (2) the defendant’s intent that the plaintiff rely on the deception, (3) occurrence of the

deception in the course of conduct involving trade or commerce, and (4) actual damages to the

plaintiff (5) proximately caused by the deception. Oliveira v. Amoco Oil Co., 776 N.E.2d 151,

160 (Ill. 2002). 

The Illinois Supreme Court has unequivocally stated that a plaintiff cannot demonstrate

proximate cause under the ICFA where there has been no communication between the plaintiff

and the defendant. De Bouse v. Bayer, 922 N.E.2d 309, 316 (Ill. 2009). The De Bouse court

found that statements and omissions are actionable under the statute only where the defendant

made a direct statement to the plaintiff and misrepresented or omitted some material fact from

that statement. Id. at 316. The court stated:

[W]e have repeatedly emphasized that in a consumer fraud action, the plaintiff must

actually be deceived by a statement or omission. If there has been no communication

with the plaintiff, there have been no statements and no omissions. In such a situation,

a plaintiff cannot prove proximate cause.

Id. 

Because Rule 9(b) applies to claims of deceptive acts, courts interpreting De Bouse have

68

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 68 of 131 PAGEID #: <pageID>
dismissed ICFA claims in which the plaintiff failed to identify the specific communication that

took place between the parties and on which the plaintiff allegedly relied. See, e.g., Shailja

Gandhi Revocable Trust v. Sitara Capital Mgmt., LLC, No. 09 C 3141, 2011 U.S. Dist. LEXIS

19784, at *16–17 (N.D. Ill. Feb. 25, 2011) (dismissing ICFA claim where “the plaintiffs have

failed to plead that they actually read or heard any of the alleged misrepresentations”); Ciszerski

v. Denny’s Corp., No. 09 C 5355, 2010 U.S. Dist. LEXIS 34132, at *9 (N.D. Ill. Apr. 7, 2010)

(“Because [plaintiff] identifies no communication that he received that was generated by

Denny’s, he has failed to plead the circumstances constituting the fraud with the particularity

required by Rule 9(b).”); Thompson’s Gas & Elec. Serv. v. BP Am. Inc., 691 F. Supp. 2d 860, 870

(N.D. Ill. 2010). Here, although Plaintiffs (and Illinois Plaintiff by incorporation) cite seven

specific statements that Defendants allegedly made, these allegations are fatally flawed under

Rule 9(b) because Plaintiffs failed to provide the time, place, and general circumstances under

which such statements were made. See supra Section III(B). Illinois Plaintiff’s allegation that he

“did rely on such misrepresentations or [was] deceived,” (ECF No. 35 ¶ 348), without more, does

not cure this deficiency. See, e.g., Cataldo, 676 F.3d at 551; Culy, 2012 WL 2071804, at *6–7. 

The Court therefore GRANTS PCNA’s motion to dismiss Count Fourteen of Plaintiffs’

Complaint to the extent that it is premised upon alleged affirmative misrepresentations. 

The issue for this Court is whether, after De Bouse, PCNA’s act in distributing the

Cayenne for sale constitutes a “statement” for purposes of the ICFA that the vehicle is safe for its

ordinary intended use. The Court finds that it does. The Illinois Supreme Court appeared to

accept essentially the same argument in Connick v. Suzuki Motor Co., in which the defendant

allegedly withheld from consumers the fact that its vehicles contained a design defect that made

69

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 69 of 131 PAGEID #: <pageID>
them susceptible to rollover. 675 N.E.2d 584, 587–88 (Ill. 1996). The plaintiffs alleged, inter

alia, that the defendant “committed consumer fraud based on the mere sale of the [subject

vehicle] without disclosure of the safety risks, in that the offering for sale of a consumer product

constitutes a representation that the product is reasonably safe for its intended use, ” and that the

plaintiffs would not have purchased the subject vehicles had they known of the safety risk. Id. at

595 (internal citations omitted). The court found that the plaintiffs stated a claim under the ICFA

based on a material omission by the defendant. Id. 

The De Bouse court later clarified this holding, stating that the Connick plaintiffs satisfied

the direct communication requirement under the statute because they received communications

from the defendant that contained “both misleading statements and material omissions.” De

Bouse, 922 N.E.2d at 316. The court reiterated its holding that “[a] consumer cannot maintain an

action under the [ICFA] when the plaintiff does not receive, directly or indirectly, communication

or advertising from the defendant.” Id. The court then went on, however, to consider the

question of whether “the act of offering a product for sale in Illinois is a representation that the

product is reasonably safe for its intended and ordinary use, such that a failure to disclose risks is

a violation of the Act.” Id. at 317. The issue in De Bouse was whether a defendant drug

manufacturer had concealed the fact that its drug was unsafe; the court discussed the unique

concerns that drug manufacturers face in certifying that any drug will be reasonably safe for all

patients and concluded that the sale of a prescription medication does not constitute a

“representation” under the ICFA. Id. at 318. The court limited its holding to the drug context and

left open the question in the context of the sale of other products. See id. 

Given the Illinois Supreme Court’s holding in Connick and the fact that vehicles can be

70

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 70 of 131 PAGEID #: <pageID>
manufactured in a condition that is reasonably safe for all consumers, the Court finds that

PCNA’s distribution of the Cayenne constitutes a statement under the ICFA that the vehicles were

safe for their ordinary, intended use. See Connick, 675 N.E.2d at 595; cf. De Bouse, 922 N.E.2d

at 316. Plaintiffs (and Illinois Plaintiff by incorporation) have alleged facts sufficient to support

an inference that the alleged coolant tube defect presents a safety risk to consumers; thus, Illinois

Plaintiff has sufficiently alleged an actionable misrepresentation under the ICFA. Similar to the

Connick plaintiffs, Illinois Plaintiff alleges that he would not have purchased a Cayenne had he

known of the alleged defect. See Connick, 675 N.E.2d at 595; cf. White v. DaimlerChrysler

Corp., 856 N.E.2d 542, 550 (Ill. App. Ct. 2006). The Court finds that this allegation satisfies the

statute’s proximate cause requirement at this stage of the litigation. See Connick, 675 N.E.2d at

595. 

Because the Connick court affirmed the reinstatement of the plaintiffs’ class action claim

on behalf of all “residents of Illinois” who purchased the subject vehicle, see id. at 587–88, and

because the alleged omission in this case is not directly tied to a specific transaction, the Court

declines to dismiss Illinois Plaintiff’s claim on the ground that he failed to allege that he

purchased his Cayenne in Illinois. The Court finds that Illinois Plaintiff’s residency in the state is

sufficient to establish a geographic link under the statute based on the facts of this case. See id.

The Court finds that Illinois Plaintiff states a claim under the ICFA premised on PCNA’s

alleged failure to disclose a safety risk to consumers. Accordingly, the Court DENIES PCNA’s

motion to dismiss these allegations. The Court GRANTS IN PART and DENIES IN PART

PCNA’s motion to dismiss Count Fourteen of Plaintiffs’ Complaint.

Count Fifteen: Unjust Enrichment (Illinois)

71

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 71 of 131 PAGEID #: <pageID>
Illinois Plaintiff brings a claim for unjust enrichment in the alternative to Plaintiffs’ breach

of express warranty claim (Count One). Illinois Plaintiff offers the same theory regarding unjust

enrichment that his co-plaintiffs offer—specifically, that PCNA was unjustly enriched by

overcharging Illinois Plaintiff for his vehicle and obtaining revenues from the replacement parts

that Illinois Plaintiff purchased. The Court finds that Illinois Plaintiff fails to state a claim for

unjust enrichment. 

 Illinois courts adhere to the general rule that, where a valid contract covers the subject

matter in dispute, an unjust enrichment claim is not appropriate. Prima Tek II, LLC v. Klerk’s

Plastic Indus., 525 F.3d 533, 541 (7th Cir. 2008). A plaintiff cannot use an unjust enrichment

claim to unilaterally alter the terms of a valid contract. First Commodity Traders, Inc. v. Heinold

Commodities, Inc., 766 F.2d 1007, 1011–12 (7th Cir. 1985); see also Indus. Truck Serv. Co. v.

Mitsubishi Int’l Corp., 432 N.E.2d 999, 1003 (Ill. App. Ct. 1982) (dismissing an unjust

enrichment claim because the “[p]laintiff’s attempt here to bring a quasi-contract action is nothing

more than an attempt to unilaterally amend the agreement in a manner prohibited by the

agreement”); accord Ball v. Sony Elecs., Inc., No. 05-C-307-S, 2005 WL 2406145, at *6 (W.D.

Wisc. Sept. 28, 2005) (“Unjust enrichment is not a mechanism for supplementing that which a

purchaser perceives as inadequate contractual remedies.”).

In determining whether a contract precludes an unjust enrichment claim, courts consider

the subject matter of the contract and not the specific terms or provisions of that contract. Duffy

v. Ticketreserve, Inc., 772 F. Supp. 2d 977, 993 (N.D. Ill. 2010); Ramirez v. Gen. Elec. Co., No.

3:08cv636, 2008 WL 4696118, at *2 (D. Conn. Oct. 21, 2008) (interpreting Illinois law); Doll,

814 F. Supp. 2d at 551 (same). In Ramirez, for example, the plaintiffs alleged that the defendant

72

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 72 of 131 PAGEID #: <pageID>
manufactured a product with a design defect and failed to disclose that defect to consumers. 2008

WL 4696118, at *1. The court refused to dismiss the plaintiff’s ICFA claim but dismissed the

unjust enrichment claim, finding that the product’s warranty—which defined the manufacturer’s

obligation to consumers with respect to “defects in material or workmanship”—covered the

subject matter at issue. Id. at *2. The court rejected the plaintiff’s argument that the warranty did

not apply to his claim for a design defect, stating that the warranty “defined the relationship of the

parties with respect to the subject matter on which the [unjust enrichment] claim rests.” Id. at *2;

see also Doll, 814 F. Supp. 2d at 551 (dismissing an Illinois plaintiff’s unjust enrichment claim

because he did not dispute the defendant’s contention that the product’s express warranty

governed the subject matter of his claim). 

Here, Illinois Plaintiff argues that he is entitled to recover a portion of the price that he

paid for his vehicle and/or the cost of repairing his vehicle because the vehicle contained a

part—allegedly defective in material—that failed outside of the Warranty Period. The 2004

Warranty defines PCNA’s obligation to consumers regarding parts that are “defective in material

or workmanship.” (ECF No. 62-3, at 7.) Allowing Illinois Plaintiff’s claim to proceed would

effectively expand the scope and/or duration of the 2004 Warranty, which is not an appropriate

purpose of an unjust enrichment claim. See Ramirez, 2008 WL 4696118, at *2; First Commodity

Traders, Inc., 766 F.2d at 1011–12.

Illinois Plaintiff does not dispute the fact that the 2004 Warranty covers the subject matter

of his unjust enrichment claim. Instead, Illinois Plaintiff argues that he may bring an unjust

enrichment claim “despite any seemingly inconsistent allegations concerning PCNA’s written

warranty.” (ECF No. 77, at 97.) As discussed in conjunction with Georgia Plaintiff’s claim, this

73

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 73 of 131 PAGEID #: <pageID>
argument would only be relevant if the validity or existence of the 2004 Warranty (and not

Georgia Plaintiff’s likelihood of recovering under that Warranty) were in dispute. See, e.g., Lilly

v. Ford Motor Co., No. 00 C 7372, 2002 U.S. Dist. LEXIS 910, at *18 (N.D. Ill. Jan. 17, 2002)

(allowing an unjust enrichment claim to proceed alongside a breach of warranty claim where

there existed “a good faith dispute” as to whether the defendant’s representations constituted an

express warranty under the UCC). Illinois Plaintiff does not argue that any such dispute exists in

this case. 

There also exists an alternative ground for dismissing Illinois Plaintiff’s unjust enrichment

claim. Illinois Plaintiff agrees with PCNA that he cannot advance an unjust enrichment claim on

the same allegations that underlie his ICFA claim; he argues that he has “pleaded his unjust

enrichment claim without incorporating the allegations of fraudulent conduct from his [I]CFA

claim . . . and it should be evaluated on its own merits.” (ECF No. 77, at 97.) But without these

allegations of fraudulent conduct, Illinois Plaintiff does not allege that PCNA engaged in any

conduct that would make its retention of the alleged benefits unjust. Because a plaintiff cannot

assert a claim for unjust enrichment in Illinois without alleging that “the defendant’s retention of

the benefit violates the fundamental principles of justice, equity, and good conscience,” HPI

Health Care Servs., Inc. v. Mt. Vernon Hosp., Inc., 545 N.E.2d 672, 679 (Ill. 1989), dismissal of

Illinois Plaintiff’s unjust enrichment claim is also proper on this ground. 

The Court finds that Illinois Plaintiff fails to state a claim for unjust enrichment. 

Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Fifteen of Plaintiffs’

Complaint. 

G. MICHIGAN 

Michigan Plaintiff Kyle Hoffecker purchased a 2006 Cayenne from an unidentified seller. 

74

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 74 of 131 PAGEID #: <pageID>
The coolant tubes in Michigan Plaintiff’s vehicle cracked in 2011, and his vehicle was rendered

disabled. Michigan Plaintiff paid to repair his vehicle and now brings claims for strict product

liability, breach of implied warranty under the UCC, violations of Michigan’s Consumer

Protection Act, Mich. Comp. Laws § 445.901 et seq., and negligence. PCNA moves to dismiss

all claims. 

Count Sixteen: Strict Product Liability (Michigan)

Michigan Plaintiff seeks to recover damages under a theory of strict product liability. 

PCNA argues, and the Court agrees, that the economic loss doctrine bars Michigan Plaintiff’s

strict liability claim. 

Michigan’s highest court has recognized the economic loss doctrine. See Neibarger v.

Universal Coops., Inc., 486 N.W.2d 612, 615 (Mich. 1992). In Neibarger, the Michigan Supreme

Court held that the plaintiff (a dairy farmer) could not pursue a negligence claim against the

defendant (a contractor) for damages allegedly caused by a defective milking system that the

defendant had designed and installed. See id. at 613–15. The court found that the plaintiff had

suffered only economic loss in the form of “frustrated expectations because the product he bought

was not working properly” and that the damages could have been addressed in the parties’

agreement. Id. at 615. The court distinguished the plaintiff’s case from those cases involving

“unanticipated personal injury,” which has “traditionally been remedied by the law of torts.” Id. 

The court concluded that “where a plaintiff seeks to recover for economic loss caused by a

defective product purchased for commercial purposes, the exclusive remedy is provided by the

UCC.” Id. at 618. 

Michigan Plaintiff highlights the Neibarger court’s “commercial purposes” language and

75

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 75 of 131 PAGEID #: <pageID>
argues that his status as an individual consumer precludes application of the economic loss

doctrine in this case. This argument fails. Although some courts initially interpreted Neibarger

as standing for the proposition that the economic loss doctrine bars tort claims of

commercial—and not individual—purchasers, Michigan courts now recognize that the doctrine

applies with equal force to individual purchasers. See Sherman v. Sea Ray Boats, 649 N.W.2d

783, 790 (Mich. Ct. App. 2002). In Sherman, a Michigan court of appeals found that the

economic loss doctrine barred an individual plaintiff’s tort claim against a boat manufacturer

when a defect in the boat allegedly caused it to decay earlier than the plaintiff expected. Id. The

court expressly rejected the plaintiff’s argument that “the economic loss doctrine applies only to

‘commercial’ or ‘non-consumer transactions’ ” and concluded that the principles underlying the

doctrine apply equally to claims brought by individual consumers. Id. at 788. Because the

individual plaintiff in Sherman sought to recover only the loss of her economic expectation in the

product, her remedy sounded in contract and her tort claim could not survive. Id. at 790. 

Michigan district courts have since found that Sherman effectively expanded the reach of the

economic loss doctrine to individual consumers in Michigan. See State Farm Fire & Cas. Co. v.

Conair Corp., No. 11-10237, 2011 U.S. Dist. LEXIS 68921, at *11–12 (E.D. Mich. June 27,

2011) (“Sherman’s application of the economic loss doctrine to a consumer transaction, though

lacking the controlling force of a Michigan Supreme Court ruling, nonetheless serves as datum

for ascertaining state law . . . .” (internal citations omitted)).14 

14See also Murphy v. Proctor & Gamble Co., 695 F. Supp. 2d 600, 602 (E.D. Mich. 2010)

(citing Sherman and holding that “the economic loss doctrine applies to consumer transactions”);

Safeco Ins. Co. of Am. v. CPI Plastics Group, Ltd., 625 F. Supp. 2d 508, 511 (E.D. Mich. 2008)

(“[C]ourts of appeals in Michigan have expanded the scope of the economic loss doctrine to

transactions made by consumers . . . .”). 

76

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 76 of 131 PAGEID #: <pageID>
The Court finds that Sherman mandates dismissal of Michigan Plaintiff’s strict liability

claim. Sherman is well reasoned and addresses the exact issue that is currently before this court;

thus, it is datum for ascertaining state law absent persuasive evidence to the contrary. See West,

311 U.S. at 237. Such persuasive evidence does not exist in this case. The Sherman court

analyzed the roots of the economic loss doctrine in Michigan and cited extensively to the

Michigan Supreme Court’s earlier decision in Hart v. Ludwig, 79 N.W.2d 895 (Mich. 1956), the

principles of which “evolved into the economic loss doctrine.” Sherman, 649 N.W.2d at 786–89. 

The Sherman court found that these principles, such as the analysis of whether a duty arose in tort

that was separate and distinct from a contractual duty, were not premised on or affected by the

relationship of the parties. Id. at 787. The court concluded that the principles underlying the

Neibarger court’s decision to bar a commercial plaintiff’s tort claim applied with equal force

where an individual consumer sought to recover purely economic loss in tort. Id. at 790. 

Sherman is therefore consistent with Hart and does not contradict Neibarger on this point. 

Michigan Plaintiff does not offer any persuasive authority to the contrary. Michigan

Plaintiff points to Blackward v. Simplex Products Division for the proposition that the economic

loss doctrine does not apply to individual consumers. No. 221066, 2001 Mich. App. LEXIS

1940, at *1–2 (Mich. Ct. App. Oct. 19, 2001). But Blackward preceded Sherman and is therefore

unpersuasive on this point. Michigan Plaintiff also argues that “when a defect is safety-related,

tort principles come into play” but do not cite any cases in which courts accepted this argument

when only product damage (and not personal injury or damage to other property) was alleged. 

(ECF No. 77, at 156.) Compare Sherman, 649 N.W.2d at 790 (stating that, where a plaintiff

seeks only economic loss and not damages for physical injury, “tort concerns with product safety

77

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 77 of 131 PAGEID #: <pageID>
no longer apply, and economic expectation issues prevail”) with Safeco, 625 F. Supp. 2d at 511

(finding that, where a defective product started a fire that destroyed the plaintiff’s home, the

plaintiff had been “injured in a manner that is traditionally considered in tort and not in contract”

and the economic loss doctrine did not apply). Finally, Michigan Plaintiff argues that the

economic loss doctrine does not apply where the parties are not in privity, but “that theory has

been rejected by both Michigan and federal courts.” Murphy, 695 F. Supp. 2d at 606; see also

Citizens Ins. Co. v. Osmose Wood Preserving, Inc., 585 N.W.2d 314, 316 (Mich. Ct. App. 1998). 

The Court finds that the economic loss doctrine bars Michigan Plaintiff’s strict product

liability claim. Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Sixteen of

Plaintiffs’ Complaint. 

Count Seventeen: Implied Warranty Under the UCC (Michigan)

Michigan Plaintiff, like many of his co-plaintiffs, brings a claim for breach of the implied

warranty of merchantability under the UCC. PCNA does not offer any arguments specific to

Michigan Plaintiff’s claim and adopts only those arguments that it advanced in connection with

Plaintiffs’ Magnuson-Moss claim—specifically, that all implied warranties had expired by the

time the alleged defect manifested in Michigan Plaintiff’s vehicle. The Court rejected these

arguments in Section IV(A)(2)(b) of this Opinion and Order (Count One) and found that Plaintiffs

had sufficiently alleged facts to suggest that the durational limitation on all implied warranties

was unconscionable. See supra Section IV(A)(2)(b) (Count One). 

The Court finds that Michigan Plaintiff states a claim for breach of the implied warranty

of merchantability. Accordingly, the Court DENIES PCNA’s motion to dismiss Count

Seventeen of Plaintiffs’ Complaint. 

78

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 78 of 131 PAGEID #: <pageID>
Count Eighteen: Michigan’s Consumer Protection Act 

The Michigan Consumer Protection Act (“MCPA”) proscribes certain “[u]nfair,

unconscionable, or deceptive methods, acts or practices in the conduct of trade or commerce.” 

Mich. Comp. Laws § 445.903(1). Affirmative misrepresentations, such as misrepresenting the

quality or characteristics of a product, and material omissions, such as failing to reveal a material

fact in such a way as to mislead or deceive a consumer, are included within the definition of

“unfair, unconscionable, or deceptive” acts under the MCPA. Id. §§ 445.903(1)(d) & (s). One

party’s failure to provide the promised benefits of a transaction also constitutes an unlawful act

under the MCPA. Id. § 445.903(y). 

Michigan courts allow consumers to bring MCPA claims premised on theories of fraud

and/or breach of implied warranty. See Mikos v. Chrysler Corp., 404 N.W.2d 783, 785 (Mich. Ct.

App. 1987); Zanger v. Gulf Stream Coach, Inc., No. 05-72300, 2005 WL 3416466, at *11 (S.D.

Mich. Dec. 15, 2005). Rule 9(b)’s heightened pleading requirements apply to MCPA allegations

of fraudulent conduct but not allegations of breach of implied warranty. In re Packaged Ice

Antitrust Litig., 779 F. Supp. 2d 642, 666 (E.D. Mich. 2011). 

Michigan Plaintiff alleges that PCNA violated the MCPA by breaching the implied

warranty of merchantability under the UCC and by making deceptive representations and

omissions regarding the quality of the Cayenne. The Court finds that Michigan Plaintiff states an

MCPA claim on theories of breach of implied warranty and failure to disclose material facts to

consumers. Michigan Plaintiff’s allegations regarding affirmative representations are not

actionable under the MCPA. 

The Court first addresses Michigan Plaintiff’s allegations regarding affirmative

79

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 79 of 131 PAGEID #: <pageID>
representations. Plaintiffs bringing MCPA claims must establish that they relied on the

defendant’s deceptive conduct to their detriment. See In re OnStar Contract Litig., 278 F.R.D.

352, 378 (E.D. Mich. 2011) (stating that there is “no dispute” that individuals asserting MCPA

claims “must establish reliance”); Williams v. Scottrade, Inc., No. 06-10677, 2006 WL 2077588,

at *7 (E.D. Mich. July 24, 2006) (dismissing a plaintiff’s MCPA claim premised on allegations of

fraud because the plaintiff failed to identify the specific statements on which he relied). Michigan

Plaintiff does not allege or argue that he heard, saw, had access to, or was aware of any of

PCNA’s purported misrepresentations. These allegations therefore cannot form the basis of a

MCPA claim. See Williams, 2006 WL 2077588, at *7. 

Michigan Plaintiff incorrectly cites Dix v. American Bankers Life Assurance Co. of

Florida, 415 N.W.2d 206 (Mich. 1987), for the proposition that he may demonstrate reliance

under the MCPA by demonstrating that a reasonable person would have relied on PCNA’s

alleged conduct even if he, himself, did not. In Dix, the plaintiffs purchased annuity policies from

the defendants and later alleged that the defendants had acted deceptively in the sale of said

policies. Id. at 207. The plaintiffs brought an MCPA claim on behalf of a putative class of

individuals that had purchased similar policies from the defendants. Id. The court held that

plaintiffs bringing putative class actions need not prove that each unnamed class member

individually relied on the alleged conduct; instead, the court allowed the plaintiffs to demonstrate

reliance on a representative basis by establishing that a reasonable person would have relied on

the alleged conduct. See id. The Dix court’s holding does not relieve plaintiffs bringing MCPA

claims of their obligation to plead individual reliance. See OnStar, 278 F.R.D. at 378

(acknowledging Dix but finding that individual plaintiffs must still establish reliance under the

80

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 80 of 131 PAGEID #: <pageID>
MCPA; to hold otherwise would improperly allow a class action to “abridge, enlarge or modify

[a] substantive right” (citing Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2561 (2011))); see

also J&R Mktg., 549 F.3d at 390. Michigan Plaintiff’s allegations of affirmative

misrepresentations are fatally flawed in this respect. The Court GRANTS PCNA’s motion to

dismiss Count Eighteen of Plaintiffs’ Complaint to the extent that it is premised on allegations of

affirmative misrepresentations. 

The Court next address Michigan Plaintiff’s claim for breach of implied warranty under

the MCPA. For the reasons set forth in Section IV(G) of this Opinion and Order (Count

Seventeen), the Court finds that Michigan Plaintiff states a claim for breach of implied warranty

under Michigan law. See supra Section IV(G) (Count Seventeen). Michigan Plaintiff therefore

states a claim for breach of implied warranty under the MCPA. See Zanger, 2005 WL 3416466,

at *11. 

The Court similarly finds that Michigan Plaintiff’s allegations regarding PCNA’s failure

to disclose material facts are actionable under the MCPA. The MCPA proscribes “[f]ailing to

reveal a material fact, the omission of which tends to mislead or deceive the consumer, and which

fact could not reasonably be known by the consumer.” Mich. Comp. Laws § 445.903(1)(s). This

language mirrors the test that California courts employ in interpreting California’s consumer

protection statute. Compare Mich. Comp. Laws § 445.903(1)(s) with Daugherty, 51 Cal. Rptr. 3d

at 126. PCNA cites Daugherty and argues that “failing to disclose that [a defendant’s] products

may require repair after expiration of the warranty period” is not an actionable omission under the

MCPA. (ECF No. 62, at 101.) But the Court rejected this argument in Section IV(B) of this

Opinion and Order (Count Two) and found that California Plaintiffs had sufficiently alleged facts

81

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 81 of 131 PAGEID #: <pageID>
to suggest that PCNA violated a duty to disclose under Daugherty. See supra Section IV(B)

(Count Two). PCNA cites no Michigan authority that would put such a general failure to disclose

outside the reach of the MCPA. 

Similarly, PCNA cites no Michigan authority to negate the conclusion that Michigan

Plaintiff has sufficiently pleaded causation. Michigan Plaintiff asserts that he had no way to

discover the alleged defect on his own and that knowledge of the alleged defect would have

altered his individual buying decision. The Court finds that these allegations are sufficient to

establish that Michigan Plaintiff relied on PCNA’s silence to his detriment. 

PCNA’s final argument is that Michigan Plaintiff fails to establish that PCNA acted with

the requisite intent under the MCPA. The Court disagrees. For the reasons set forth in Section

III(B) of this Opinion and Order, the Court finds that Plaintiffs have pleaded facts suggesting that

PCNA had knowledge of the alleged defect at all times relevant and failed to disclose the defect

to consumers. See supra Section III(B). These pleaded facts support an inference that PCNA

acted with the requisite intent to deceive. Cf. Rodriguez v. Berrybrook Farms, Inc., No. K86-161,

1990 U.S. Dist. LEXIS 7678, at *39–40 (W.D. Mich. June 20, 1990) (holding that, where the

plaintiffs failed to show that the defendant authorized or had knowledge of the alleged conduct,

the plaintiffs failed to demonstrate that the defendants acted with an intent to deceive). 

The Court finds that Michigan Plaintiff states a claim for violations of the MCPA based

on theories of breach of implied warranty and failure to disclose material facts to consumers but

not affirmative misrepresentations. Accordingly, the Court DENIES PCNA’s motion to dismiss

these allegations. The Court GRANTS IN PART and DENIES IN PART PCNA’s motion to

dismiss Count Eighteen of Plaintiffs’ Complaint. 

82

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 82 of 131 PAGEID #: <pageID>
Count Nineteen: Negligence (Michigan)

Michigan Plaintiff argues that PCNA negligently designed and/or manufactured the

Cayenne in such a way as to cause harm to Michigan Plaintiff. The parties do not offer any

arguments in addition to those that they advanced in connection with Michigan Plaintiff’s strict

liability claim. 

For the reasons set forth in Section IV(G) of this Opinion and Order, the Court finds that

the economic loss doctrine precludes Michigan Plaintiff from advancing a tort claim in this case. 

See supra Section IV(G) (Count Sixteen). The economic loss doctrine therefore bars Michigan

Plaintiff’s negligence claim, and the Court GRANTS PCNA’s motion to dismiss Count Nineteen

of Plaintiffs’ Complaint. 

H. NEW JERSEY 

New Jersey Plaintiffs Daniel Delgado, Richard Gorospe, and Nicholas Spagnoletti

purchased Cayennes that came equipped with plastic coolant tubes. Plaintiffs Delgado and

Gorospe purchased their vehicles (Delgado purchased a 2004 model and Gorospe a 2005 model)

from used car dealerships in 2009, and both experienced problems with their coolant tubes in

2010. Both Delgado’s and Gorospe’s Cayennes were leaking coolant but had not actually failed

at the time they replaced the plastic coolant tubes with aluminum pipes. Plaintiff Spagnoletti

purchased a certified pre-owned Cayenne (model year 2004) from an authorized Porsche

dealership in 2010 and preemptively replaced the plastic coolant tubes with aluminum pipes at the

suggestion of his mechanic. New Jersey Plaintiffs now bring claims for violations of the New

Jersey Consumer Fraud Act (“NJCFA”), N.J. Stat. Ann. §56:8-1 et seq., and for breach of the

implied warranty of merchantability. PCNA moves to dismiss both claims. 

83

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 83 of 131 PAGEID #: <pageID>
Count Twenty: New Jersey’s Consumer Fraud Act

 Under the NJCFA, it is unlawful for any person to knowingly conceal, suppress, or omit

material facts in connection with the sale or advertisement of merchandise. N.J. Stan. Ann. §

56:8-2. The NJCFA provides a claim for relief to “[a]ny person who suffers any ascertainable

loss of moneys or property, real or personal, as a result of the use or employment by another

person of any method, act, or practice declared unlawful under this act.” Id. § 56:8-19. To state a

claim under the NJCFA, a plaintiff must allege that (1) the defendant engaged in unlawful

conduct, (2) the plaintiff suffered an ascertainable loss and (3) a causal relationship exists

between the defendant’s unlawful conduct and the plaintiffs’ ascertainable loss. Int’l Union of

Operating Eng’rs Local No. 68 Welfare Fund v. Merck & Co., 929 A.2d 1076, 1086 (N.J. 2007)

(per curiam). 

PCNA argues that New Jersey Plaintiffs’ fail to demonstrate “ascertainable loss” under the

NJCFA. The Court agrees and finds that New Jersey Plaintiffs fail to state a claim for violations

of the NJCFA. 

New Jersey courts have held that a plaintiff cannot demonstrate “ascertainable loss” under

the NJCFA where the allegedly defective vehicle component outperforms its warranty period. 

Perkins v. Daimler Chrysler Corp., 890 A.2d 997, 1005 (N.J. Super. Ct. App. Div. 2006); see

also Nobile v. Ford Motor Co., No. 10-1890, 2011 WL 900119, at *6 (D.N.J. Mar. 14, 2011). 

The Perkins court reasoned that “ ‘[t]he defects that arise and are addressed by warranty, at no

cost to the consumer, do not provide the predicate “loss” that the [NJ]CFA expressly requires for

a private claim under the [NJ]CFA, bringing with it the potential for treble damages, attorney’s

fees, and the court costs and fees.’ ” Perkins, 890 A.2d at 1004 (citing Thiedemann v. Mercedes84

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 84 of 131 PAGEID #: <pageID>
Benz USA, 872 A.2d 783, 794 (N.J. 2005)). The court reasoned that a consumer suffers no

ascertainable loss if a part fails within the warranty period and is repaired at no cost to the

consumer. Id. It would be “illogical” for a court to conclude that a consumer suffered

ascertainable loss simply because that product outlived its warranty period. Id. at 1004–05. 

New Jersey Plaintiffs argue that the Perkins rule does not apply where the defendant

concealed defects or where the defect presents a safety concern. This argument is against the

weight of authority. Although the Perkins court “offered no view” regarding a safety concerns

exception, 890 A.2d at 1004, courts in New Jersey have since found Perkins’ holding equally

persuasive in cases in which safety concerns and/or concealment of defects are alleged. See, e.g.,

Nobile, 2011 WL 900119 at *6 (applying Perkins to deny a NJCFA claim and stating that “it is of

no moment that [p]laintiffs allege that [d]efendant concealed defects and allege safety concerns”);

Noble v. Porsche Cars N. Am., Inc., 694 F. Supp. 2d 333, 337 (D.N.J. 2010) (dismissing a

putative class action in which the plaintiffs alleged that their vehicles contained a design defect

that caused antifreeze to leak into the engine and stating that “we agree with the Appellate

Division’s rationale [in Perkins] and find its holding just as applicable here, in a case where

safety concerns are alleged”); Duffy v. Samsung Elecs. Am., Inc., No. 06-5259, 2007 WL 703197,

at *7–8 (D.N.J. Mar. 2, 2007) (dismissing a NJCFA claim for failure to plead ascertainable loss

over the plaintiff’s argument that the manufacturer “concealed a known safety hazard that could

have been corrected during the warranty period”). 

Similarly, the defendant’s knowledge of a defect may be relevant in determining whether

that defendant committed an unlawful act, but not whether the plaintiff suffered ascertainable

loss. See, e.g., Nobile, 2011 WL 900119, at *6; Noble, 694 F. Supp. 2d at 339 n.4; Duffy, 2007

85

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 85 of 131 PAGEID #: <pageID>
WL 703197, at *7–8 (discussing a defendant’s knowledge of an alleged defect in terms of the

NJCFA’s “unlawful conduct” requirement and concluding that even if the plaintiff had properly

pleaded unlawful conduct, the claim still failed to allege ascertainable loss). New Jersey

Plaintiffs cite Maniscalco v. Brother International Corp., 627 F. Supp. 2d 494, 502 (D.N.J. 2009),

for the proposition that, where a defendant has knowledge of and conceals a defect, that conduct

is actionable under the NJCFA. Indeed, the Maniscalco court found that the NJCFA is not

“categorically inapplicable” where a seller “knew that its product had a defect which would cause

it to fail before its useful life, and intention concealed that information from the purchaser.” Id. 

Another New Jersey district court later clarified this holding. See Noble, 694 F. Supp. 2d at 339

n.4. The Noble court found, and this Court agrees, that the Maniscalco court reached its

conclusion “in the context of finding that plaintiff sufficiently plead an unlawful act” and did not

fully discuss “whether a plaintiff had sufficiently pled an ascertainable loss.” Id. The Noble

court went on to dismiss the plaintiff’s claim (on allegations very similar to those alleged here)

because his vehicle had performed adequately under its warranty and he could not demonstrate

ascertainable loss. Id. 

In arguing that Perkins does not apply where a defendant concealed defects or failed to

disclose safety concerns, New Jersey Plaintiffs improperly conflate the NJCFA’s ascertainable

loss requirement with its unlawful act requirement. The gist of New Jersey Plaintiffs’ argument is

that PCNA had a duty to disclose the alleged defect and that its failure to do so is actionable

conduct. See ECF No. 77, at 37–38 (citing In re Philips/Magnavox TV Litig., No. 09-3072, 2010

U.S. Dist. LEXIS 91343, at *20 (D.N.J. Sept. 1, 2010), for the proposition that a defendant has a

duty to disclose defects that pose a safety risk to consumers). But the fact that non-disclosure of

86

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 86 of 131 PAGEID #: <pageID>
safety risks may be unlawful (and thus actionable) conduct in some states does not demonstrate

that New Jersey Plaintiffs suffered ascertainable loss under the NJCFA. The NJCFA requires

both an unlawful act and ascertainable loss. New Jersey Plaintiffs cannot demonstrate the latter

by merely referencing the former. 

The Court finds that New Jersey Plaintiffs fail to state a claim under the NJCFA. 

Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Twenty of Plaintiffs’

Complaint. 

Count Twenty-One: Implied Warranty of Merchantability (New Jersey)

New Jersey Plaintiffs bring a claim for breach of the implied warranty of merchantability

under the UCC. PCNA does not offer any arguments regarding New Jersey Plaintiffs’ implied

warranty claim in addition to those that it advanced in connection with Plaintiffs’ MagnusonMoss claim. Specifically, PCNA argues that all implied warranties had expired by the time the

alleged defect manifested in New Jersey Plaintiffs’ vehicles. The Court rejected these arguments

in Section IV(A)(2)(b) of this Opinion and Order (Count One) and found that Plaintiffs had

sufficiently alleged facts to suggest that the durational limitation on all implied warranties was

unconscionable. See supra Section IV(A)(2)(b) (Count One). The Court therefore finds that New

Jersey Plaintiffs state a claim for breach of the implied warranty of merchantability. The Court

DENIES PCNA’s motion to dismiss Count Twenty-One of Plaintiffs’ Complaint. 

I. NEW YORK

New York Plaintiffs Gregory Cadman, Ecliff Jackman, and Dane McIntosh purchased

Cayennes that came equipped with plastic coolant tubes. Plaintiff Cadman purchased a year 2004

certified pre-owned Cayenne in September 2008 from an authorized Porsche dealership in

87

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 87 of 131 PAGEID #: <pageID>
Connecticut. The coolant tubes in Plaintiff Cadman’s vehicle cracked in 2011, and he paid a

mechanic to repair the vehicle in New York. Plaintiff Jackman purchased a 2005 certified preowned Cayenne in 2008 from a Porsche authorized dealership in New York; the coolant tubes in

his vehicle began leaking in June 2011, and he paid to repair the vehicle. Plaintiff McIntosh

purchased a used 2004 Cayenne from an unidentified seller in New Jersey in 2008. The coolant

tubes in Plaintiff McIntosh’s vehicle began leaking in October 2010, and he paid to have the

vehicle repaired in New York. 

New York Plaintiffs now bring claims for violations of New York’s General Business

Law (“NYGBL”) § 349 and unjust enrichment. PCNA moves to dismiss both claims. 

Count Twenty-Two: New York’s General Business Law

 Section 349(a) of the NYGBL provides that “[d]eceptive acts or practices in the conduct

of any business, trade or commerce or in the furnishing of any service in this state are hereby

declared unlawful.” N.Y. Gen. Bus. Law § 349(a). The act provides a private claim for relief to

“any person who has been injured by reason of any violation of this section.” N.Y. Gen. Bus.

Law § 349(h). The New York Court of Appeals has stated that Section 349 is based on “broad

consumer protection concerns” and “contemplates actionable conduct that does not necessarily

rise to the level of fraud.” Gaidon v. Guardian Life. Ins. Co. of Am., 725 N.E.2d 598, 603 (N.Y.

1999).

PCNA argues that New York Plaintiffs fail to satisfy the substantive requirements of

Section 349 and, alternatively, that Plaintiffs Cadman and McIntosh lack standing to pursue a

Section 349 claim. The Court finds that New York Plaintiffs state a claim for relief under Section

349. 

88

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 88 of 131 PAGEID #: <pageID>
A. Substantive Arguments 

To state a claim under Section 349, a plaintiff must allege that the challenged act or

practice was consumer-oriented, that it was deceptive or misleading in a material way, and that

the plaintiff suffered injury as a result of the deceptive act. Oswego Laborers’ Local 214 Pension

Fund v. Marine Midland Bank, 647 N.E.2d 741, 744 (N.Y. 1995). The parties dispute whether

New York Plaintiffs have sufficiently alleged a deceptive act and/or the requisite causation under

the statute. 

Deceptive acts under Section 349 can take the form of misrepresentations or omissions. 

Id. at 744–45. New York’s Court of Appeals has suggested that an omission is deceptive under

the statute where the business fails to disclose material information to the consumer:

In the case of omissions in particular . . . the statute surely does not require businesses

to ascertain consumers’ individual needs and guarantee that each consumer has all

relevant information specific to its situation. The scenario is quite different, however,

where the business alone possesses material information that is relevant to the

consumer and fails to provide this information. 

Id. at 745. Courts must examine the challenged act objectively to determine whether the

representation or omission is “likely to mislead a reasonable consumer acting reasonably under

the circumstances.” Id. at 744. 

Notwithstanding this “reasonable consumer” standard, plaintiffs bringing Section 349

claims must demonstrate that the allegedly deceptive act caused their injuries. Stutman v. Chem.

Bank, 731 N.E.2d 608, 611–12 (N.Y. 2000). This is a lesser—albeit related—standard than

justifiable reliance. See id. (finding that the plaintiffs adequately pleaded causation when they

alleged that the defendant’s material omission—failing to inform the plaintiff of a $275

transaction fee—caused them to suffer a $275 loss). The Stutman court noted that causation and

89

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 89 of 131 PAGEID #: <pageID>
justifiable reliance are “twin concepts” and that, although plaintiffs must allege that the deceptive

conduct “caused” their injury, they need not demonstrate that they justifiably relied on the alleged

omission. Id. at 612. 

Here, New York Plaintiffs allege that PCNA committed deceptive acts by (1) failing to

disclose material information from consumers regarding the defective nature of the Cayenne’s

cooling system and (2) affirmatively misrepresenting the quality of the Cayenne. The Court finds

that the former allegations are sufficient to state a Section 349 claim but that the latter allegations

cannot survive PCNA’s motion to dismiss. 

The Court first disposes of New York Plaintiffs’ allegations regarding affirmative

misrepresentations. Similar to their co-plaintiffs, New York Plaintiffs do not plead any facts

suggesting that they saw, heard, or were aware of PCNA’s alleged misrepresentations at any

relevant time. See supra Section III(B). New York Plaintiffs therefore cannot claim that these

statements caused their injuries. See, e.g., Syzmczak, 2011 U.S. Dist. LEXIS 153011, at *42

(dismissing Section 349 claims in which the plaintiffs did not have access to the alleged

misrepresentations and stating that “[a]lthough privity between a buyer and seller is not required

for a Section 349 claim, the buyers must still allege receipt of or exposure to the misleading

practice or act”); see also Goshen v. Mut. Life. Ins. Co., 774 N.E.2d 1190, 1196 (N.Y. 2002)

(stating that, to be actionable, the allegedly deceptive advertisement or promotional package must

result in a transaction in which the consumer was harmed). Although causation under Section

349 requires a lesser showing than justifiable reliance, New York Plaintiffs must still identify the

specific statements that allegedly “caused” their injuries. See Syzmczak, 2011 U.S. Dist. LEXIS

153011, at *42. The Court GRANTS PCNA’s motion to dismiss Count Twenty-Two of

90

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 90 of 131 PAGEID #: <pageID>
Plaintiffs’ Complaint to the extent it is premised on allegations of affirmative misrepresentations. 

The Court reaches the opposite conclusion regarding PCNA’s alleged failure to disclose. 

New York’s highest court has suggested that a defendant-manufacturer’s failure to disclose

material information to consumers is actionable conduct under Section 349. See Oswego, 647

N.E.2d at 745; see also Goshen, 774 N.E.2d at 1197. At least two district courts applying Section

349 have allowed claims to proceed where a defendant-manufacturer allegedly failed to disclose

material product defects to consumers. See Szymczak, 2011 U.S. Dist. LEXIS 153011, at *46

(citing Oswego and holding that the plaintiffs adequately stated a claim under Section 349 based

on the defendant’s failure to disclose a material defect to consumers); Doll, 814 F. Supp. 2d at

550 (citing Oswego and holding that the plaintiffs adequately pleaded a Section 349 claim when

they alleged that “[defendant] misled consumers by withholding material information regarding

the defective torque converter, and, as a result, consumers were harmed by high repair and

replacement costs”). In Doll, the court expressly rejected the defendant’s argument that “a

warranty is an express acknowledgment of potential defects in the vehicles[; c]onsequently,

[defendant] did not mislead their customers since it already disclosed this information.” 814 F.

Supp. 2d at 546. The court stated that “a warranty defense is generally unavailable when there

are allegations of intentional concealment of a defect or where a defendant has an obligation to

disclose the defect.” Id. The Court finds that this reasoning is consistent with the New York

Court of Appeal’s suggestion in Oswego that defendants have a duty to disclose material

information to consumers. Oswego, 647 N.E.2d at 745. 

 The Court recognizes that a New York appellate court’s holding in Against Gravity

Apparel, Inc. v. Quarterdeck Corp. lends support to PCNA’s position. 699 N.Y.S.2d 368, 368

91

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 91 of 131 PAGEID #: <pageID>
(App. Div. 1999) (holding that, where the defendant allegedly knew that its product was not Y2K

compliant and failed to disclose this fact to consumers, the defendant did not act deceptively

because the product outlived its ninety-day warranty). See also Moore v. Microsoft Corp., 741

N.Y.S.2d 91, 91 (App. Div. 1999) (affirming dismissal of a plaintiff’s complaint when the

allegedly defective software came with a user agreement that disclaimed all warranties and “there

was no warranty given by the defendant that the software product was error free”). The Court

finds, however, that Against Gravity is unpersuasive in this case. 

First, the Against Gravity court did not cite Oswego and thus did not distinguish the New

York Court of Appeals’ language from the facts it confronted. See Against Gravity, 699 N.Y.S.2d

at 368. At least one other federal district court has declined to follow Against Gravity due to its

lack of substantive analysis. See In re OnStar Contract Litig., 600 F. Supp. 2d at 870 (stating that

Against Gravity “provides little analysis” and is not “persuasive support” in favor of dismissing a

Section 349 claim). The other case on which PCNA relies, Moore v. Microsoft Corp., similarly

fails to distinguish the Court of Appeals’ language in Oswego. See 741 N.Y.S.2d at 91.

Second, the Against Gravity court did not confront the issue of safety risks. See 699

N.Y.S.2d at 368 (analyzing a product defect claim in which a computer ceased operating). The

issue of safety risks is central to the test that California courts use in assessing deceptive conduct

in the product liability context, and this test is analogous to the New York Court of Appeals’

language in Oswego. Compare Doll, 814 F. Supp. 2d 526, 550 (citing Oswego and finding that a

defendant’s failure to disclose a defect that will manifest post-warranty is actionable under the

NYGBL “where a defendant has an obligation to disclose the defect”) with Daugherty, 51 Cal.

Rptr. 3d at 126 (stating that a defendant’s failure to disclose defects that will manifest post92

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 92 of 131 PAGEID #: <pageID>
warranty is actionable under the CLRA where the defendant had a “duty to disclose”). Indeed,

PCNA argues that Against Gravity is consistent with Daugherty because both courts implicitly

found that “consumer protection claims cannot be premised on allegations that a

manufacturer/distributor failed to disclose that a product may fail after a warranty expires.” (ECF

No. 91, at 49.) This Court found in Section IV(B) of this Opinion and Order (Count Two) that

California Plaintiffs had sufficiently alleged facts to suggest that PCNA violated a duty to

disclose under Daugherty and therefore acted deceptively for purposes of California’s consumer

protection statute. See supra Section IV(B) (Count Two). Given PCNA’s own comparison of

Against Gravity and Daugherty, and given the seemingly analogous nature of the tests that

California and New York courts employ, the Court is unwilling to apply Against Gravity to

dismiss New York Plaintiffs’ Section 349 claim in this case. 

The Court next finds that New York Plaintiffs have sufficiently alleged causation. New

York Plaintiffs allege that the coolant tube defect was material and that knowledge of the defect

would have altered their individual buying decisions. New York Plaintiffs also allege that they

were not aware of the alleged defect at the time they purchased their vehicles and that, due to the

design and placement of the coolant tubes, they could not have reasonably discovered the defect

before they purchased their vehicles. The Court finds that such allegations are sufficient to

support an inference that PCNA’s omission caused New York Plaintiffs to suffer injuries in this

case.

B. Standing – Cadman and McIntosh

The Court next confronts PCNA’s argument that New York Plaintiffs Cadman and

McIntosh do not have standing to bring a Section 349 claim. PCNA argues that, because

93

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 93 of 131 PAGEID #: <pageID>
Plaintiffs Cadman and McIntosh purchased their vehicles outside of the state (Connecticut and

New Jersey, respectively), they fail to satisfy Section 349’s geographic nexus requirement. The

Court rejects these arguments and finds that New York Plaintiffs may pursue a claim for relief

under Section 349. 

Plaintiffs bringing a Section 349 claim must demonstrate that the allegedly deceptive act

or practice has a sufficient geographic nexus to the state. N.Y. Gen. Bus. Law § 349(a); Goshen,

774 N.E.2d at 1195 (N.Y. 2002) (“To apply [Section 349] to out-of-state transactions in the case

before us would lead to an unwarranted expansive reading of the statute, contrary to legislative

intent, and potentially leading to the nationwide, if not global application of General Business

Law § 349.” (citing Oswego, 647 N.E.2d at 744–45 (N.Y. 1995))). The fact that a plaintiff

resides in New York is insufficient to establish the requisite geographic nexus; instead, the statute

is intended to protect consumers in their transactions that take place in the state. Goshen, 774

N.E.2d at 1196. 

New York courts have suggested that Section 349’s geographic nexus requirement may be

satisfied in one of three ways. First, a plaintiff has standing under Section 349 if the transaction

in which he or she was deceived took place in New York. See, e.g., Oswego, 647 N.E.2d at 743. 

Second, even if the deception took place elsewhere, a plaintiff has standing under Section 349 if

the transaction in which he or she was actually harmed took place in New York. See Goshen, 774

N.E.2d at 1196 (stating that Section 349 was not “intended to function as a per se bar to out-ofstate plaintiffs’ claims of deceptive acts leading to transactions within the state”). Finally, at least

one New York court has held that a plaintiff has standing under Section 349 when he or she was

exposed to deceptive conduct aimed at New York that led to a harmful transaction, even if that

94

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 94 of 131 PAGEID #: <pageID>
transaction took place outside of the state. Meachum v. Outdoor World Corp., 652 N.Y.S.2d 749,

750 (App. Div. 1997) (finding that, where the plaintiffs executed a contract in Pennsylvania and

“much of the purported fraudulent activity occurred in that State,” plaintiffs had standing under

Section 349 because “defendants engaged in deceptive conduct in New York by mailing

misleading literature to New York residents in an attempt to induce them to travel to the

defendants’ facilities in Pennsylvania”). 

The Court finds that Plaintiffs Cadman and McIntosh satisfy the geographic nexus

requirement under the second scenario. New York Plaintiffs allege that PCNA violated a general

duty to disclose information regarding the Cayenne’s coolant system to consumers, and that this

conduct caused Plaintiffs Cadman and McIntosh to purchase defective vehicles and have the

defect repaired in New York. The Court finds that this sequence of events is akin to “claims of

deceptive acts” that led to “transactions within the state” that the Goshen court suggested would

satisfy Section 349’s geographic nexus requirement. See 774 N.E.2d at 1196. The Court

therefore declines to dismiss Plaintiff Cadman’s or Plaintiff McIntosh’s claim on standing

grounds. 

The Court finds that New York Plaintiffs state a Section 349 claim premised on deceptive

omissions but not on affirmative misrepresentations. Accordingly, the Court GRANTS IN

PART and DENIES IN PART PCNA’s motion to dismiss Count Twenty-Two of Plaintiffs’

Complaint. 

Count Twenty-Three: Unjust Enrichment (New York)

In New York, as in Georgia and Illinois, it is well settled that “[t]he existence of a valid

and enforceable written contract governing a particular subject matter ordinarily precludes

recovery in quasi contract for events arising out of the same subject matter.” Clark-Fitzpatrick,

95

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 95 of 131 PAGEID #: <pageID>
Inc. v. Long Island R.R. Co., 516 N.E.2d 190, 193 (N.Y. 1987); Statler v. Dell, 775 F. Supp. 2d

474, 485–86 (E.D.N.Y. 2011). Courts interpreting New York state law have found that, in cases

involving allegedly defective products, express warranties cover the subject matter at issue and an

unjust enrichment claim does not lie. See Statler, 775 F. Supp. 2d at 474; Wiseberg v. Toyota

Motor Corp., No. 11-3776, 2012 WL 1108542, at *12 (D.N.J. Mar. 30, 2012) (interpreting New

York law). 

Similar to their co-plaintiffs, New York Plaintiffs argue that they are entitled to recover a

portion of the price that they paid for their vehicles and/or the cost of repairing their vehicles

because their vehicles contained a part that was defective in material. New York Plaintiffs’

vehicles are subject to the terms of the 2004 Warranty (Cadman and McIntosh) and the 2005

Warranty (Jackman), which define PCNA’s obligation to reimburse consumers regarding “any

factory-installed part that is defective in material or workmanship under normal use.” (ECF No.

62-3, at 7; 62-5, at 6.) The Warranties therefore cover the subject matter of New York Plaintiffs’

unjust enrichment claim. See Wiseberg, 2012 WL 1108542, at *12; accord Ramirez, 2008 WL

4696118, at *2.15 Allowing New York Plaintiffs to proceed with their unjust enrichment claim

15In response to PCNA’s argument that New York Plaintiffs failed to allege a connection

between themselves and PCNA, New York Plaintiffs cite Cox v. Microsoft Corp., 778 N.Y.S.2d

147, 149 (App. Div. 2004), for the proposition that a plaintiff need not confer a direct benefit on

a defendant in order to state a claim for unjust enrichment under New York law. Regardless of

whether New York courts permit recovery in quasi-contract for indirect benefits, Cox illustrates

why the Warranties bar New York Plaintiffs’ claim in this case. In Cox, the court permitted the

plaintiffs to pursue a theory of unjust enrichment to recover the “artificially inflated prices” that

they paid for a product as a result of the defendant’s alleged monopolistic conduct. Id. at 149. 

The court noted, however, that such conduct was outside the scope of any “end-user license

agreements with [the defendant’s] prime customers,” which would “insulate” the defendant from

“product defect claims.” Id. Cox can be read to suggest that, when the subject matter of the

claim is not covered by a contract, that contract will not bar a plaintiff’s unjust enrichment claim. 

See Cox, 778 N.Y.S.2d at 149. Where, however, the contract does cover the subject matter of

the claim—as in the case of an end-user agreement that would have precluded an unjust

96

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 96 of 131 PAGEID #: <pageID>
would effectively expand the scope and duration of the 2004 and 2005 Warranties, which is not

an appropriate purpose of an unjust enrichment claim. See Wiseberg, 2012 WL 1108542, at *12;

Statler, 775 F. Supp. 2d at 474; Doll, 814 F. Supp. 2d at 551 (dismissing two New York

plaintiffs’ unjust enrichment claims on allegations similar to those alleged here because the

plaintiffs did not dispute the defendant’s contention that an express contract—a product’s

warranty—governed the subject matter of their claims). 

New York Plaintiffs are not arguing that the Warranties do not cover the subject matter of

their claim. Instead, New York Plaintiffs cite Waldman v. Englishtown Sportswear, Ltd. for the

proposition that “[w]here the express contract has been rescinded, is unenforceable or abrogated,

a recovery may be had on an implied promise to pay for benefits conferred thereunder.” 460

N.Y.S.2d 552, 556 (App. Div. 1983). Waldman does not apply to the facts of this case. New

York Plaintiffs do not argue that, had the defect manifested within the four-year/50,000 mile

Warranty Period, they would have been unable to recover because the Warranty was invalid or

unenforceable. Cf. Lilly, 2002 U.S. Dist. LEXIS 910, at *18 (allowing an unjust enrichment

claim to proceed alongside a breach of warranty claim where there existed “a good faith dispute”

as to whether the defendant’s representations constituted an express warranty under the UCC). 

Instead, New York Plaintiffs appear to argue that one of the Warranty’s terms—the express

warranty’s durational limitation—is unenforceable. Accepting this argument would allow New

York Plaintiffs to use an unjust enrichment claim to unilaterally alter one of the Warranties’

terms, which is not an appropriate purpose of an unjust enrichment claim. Wiseberg, 2012 WL

1108542, at *12; accord First Commodity Traders, Inc., 766 F.2d at 1011–12; Terrill, 753 F.

enrichment claim for product defects—a plaintiff may not advance an unjust enrichment claim

based on the same subject matter. See id.; Wiseberg, 2012 WL 1108542, at *12. 

97

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 97 of 131 PAGEID #: <pageID>
Supp. 2d at 1291.16 

The Waldman court’s statement is even further removed from the facts of this case

because New York Plaintiffs cannot demonstrate that any “recovery may be had on an implied

promise to pay for benefits conferred.” 460 N.Y.S.2d at 556. Here, there has been no implied

promise to pay for repairs past the warranty period. New York Plaintiffs do not point to any

allegations suggesting that PCNA made such a promise or that such a promise can be inferred

from PCNA’s conduct. Waldman is therefore inapposite and does not save New York Plaintiffs’

unjust enrichment claim. 

The Court finds that New York Plaintiffs fail to state a claim for unjust enrichment.

Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Twenty-Three of Plaintiffs’

Complaint. 

J. OHIO

Ohio Plaintiffs Lance Bredefeld and Deana Crawford purchased Cayennes that came

16New York Plaintiffs also cite Szymczak v. Nissan Motor Co., Ltd., in which the court

declined to dismiss two New York plaintiffs’ unjust enrichment claims at the pleading stage

because they brought their claim in the alternative to a breach of warranty claim. 2011 U.S.

Dist. LEXIS 153011, at *55. The Szymczak court failed to account for the fact that plaintiffs

cannot use an unjust enrichment claim to unilaterally alter the terms of a contract. See Statler,

775 F. Supp. 2d at 474; Wiseberg, 2012 WL 1108542, at *12. Indeed, the Wiseberg court cited

Szymczak on several points of law outside of the unjust enrichment context but held that the

plaintiffs could not advance an unjust enrichment claim where the product’s warranty covered

the subject matter of their claim. Wiseberg, 2012 WL 1108542, at *12. Importantly, in

Wiseberg, the plaintiffs (like New York Plaintiffs here) alleged that the defendant concealed

material defects and the court permitted the plaintiffs’ Section 349 claim to proceed. Id. at *6. 

Even if Szymczak were correct on this point, however, New York Plaintiffs’ argument still fails

because Plaintiffs abandoned their express warranty claims in all cases in which the alleged

defect manifested outside of the Warranty Period. (ECF No. 77, at 28 n.3.) Because such a

claim would have “provided their only basis for their unconscionability arguments” in this

context, New York Plaintiffs “cannot now rely on these abandoned claims to prop up their unjust

enrichment claim.” Zwicker v. Gen. Motors Corp., No. C07-0291-JCC, 2007 WL 5309204, at *6

(W.D. Wash. July 27, 2007). 

98

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 98 of 131 PAGEID #: <pageID>
equipped with plastic coolant tubes. Plaintiff Bredefeld purchased a 2006 vehicle in 2010 from a

Suzuki dealership and Plaintiff Crawford purchased a 2004 Cayenne in 2005 from an unidentified

seller. The coolant tubes in Ohio Plaintiffs’ vehicles failed (Bredefeld’s in 2010 and Crawford’s

in 2011) and rendered the vehicles disabled. Ohio Plaintiffs both paid to repair and install

aluminum pipes in their vehicles and now bring claims for breach of implied warranty in tort,

violations of Ohio’s Consumer Sales Practices Act, Ohio Rev. Code § 1345.01 et seq.,

negligence, and violations of Ohio’s Deceptive Trade Practices Act, Ohio Rev. Code § 4165.01 et

seq. PCNA moves to dismiss all claims. 

Count Twenty-Four: Breach of Implied Warranty in Tort (Ohio)

In Ohio, every manufacturer or distributor impliedly warrants that its products are of good

and merchantable quality, fit and safe for the ordinary purposes for which they are intended. See

Ohio Rev. Code § 1302.27 (adopting UCC § 2-314 as Ohio law); Lonzrick v. Republic Steel

Corp., 6 Ohio St. 2d 227, 229–30, 218 N.E.2d 185 (1966). There are two types of implied

warranty claims that are available to Ohio consumers if this warranty is breached. The

availability of each depends on whether the consumer is in privity with the seller. 

Purchasers that are in privity with the seller may pursue a claim for breach of implied

warranty of merchantability under the UCC. See Ohio Rev. Code § 1302.27(A); Curl, 114 Ohio

St. 3d ¶ 26 (Ohio 2007).17 Such an action sounds in contract and is subject to the provisions of

the UCC. See Ohio Rev. Code § 1302.27(A). Ohio Plaintiffs admit that they are not in privity

with PCNA and therefore are not asserting a claim for breach of the implied warranty of

merchantability. 

17See also Section IV(A)(2) of this Opinion and Order (Count One) (discussing implied

warranty of merchantability claims in the context of the federal Magnuson-Moss Act). 

99

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 99 of 131 PAGEID #: <pageID>
Instead, Ohio Plaintiffs bring a claim for breach of the implied warranty in tort. This

claim for relief is only available to remote purchasers of goods and can be used to recover purely

economic loss. Lonzrick, 6 Ohio St. 2d at 229–30; Iacono v. Anderson Concrete Corp., 42 Ohio

St. 2d 88, 93, 326 N.E.2d 267 (1975) (extending Lonzrick’s holding to property damage and

stating that “an action in tort, based on the properly pleaded theory of breach of implied warranty,

may be maintained to recover for damage to property”); Chemtrol Adhesives, Inc. v. Am. Mfrs.

Mut. Ins. Co., 42 Ohio St. 3d 40, 49–50, 537 N.E.2d 624 (1989) (holding that parties in privity of

contract may not bring implied warranty in tort claims and that such claims are limited to remote

purchasers only). Ohio’s implied warranty in tort claim effectively extends the UCC’s implied

warranty protections to purchasers who are not in privity with the party against whom they seek

to assert their claim. See, e.g., Trgo v. Chrysler Corp., 34 F. Supp. 2d 581, 588 n.5 (N.D. Ohio

1998) (“Ohio law [] converts claims for breach of implied warranty [under the UCC] into tort

claims when contractual privity is absent.”).

PCNA argues that Ohio Plaintiffs’ implied warranty in tort claim is time-barred. PCNA

acknowledges that implied warranty of merchantability claims are subject to a different statute of

limitations than implied warranty in tort claims and that, under current Ohio jurisprudence, Ohio

Plaintiffs’ implied warranty in tort claim is not time-barred. PCNA argues that the statute of

limitations for implied warranty of merchantability claims has expired and asks this Court to

similarly limit the statute of limitations for Ohio Plaintiff’s implied warranty in tort claim. PCNA

bases its argument on the following analysis. 

Implied warranty of merchantability claims are subject to the four-year statute of

limitations set forth in the UCC. See Ohio Rev. Code § 1302.98(A)–(B) (adopting UCC § 2-

725(1)–(2) as Ohio law); Val Decker Packing Co. v. Corn Prods. Sales Co., 411 F.2d 850, 851

100

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 100 of 131 PAGEID #:

 <pageID>
(6th Cir. 1969) (recognizing the four-year statute of limitations provided in Ohio Rev. Code §

1302.98 and UCC § 2-725); but see Ressallat v. Burglar & Fire Alarms, Inc., 79 Ohio App. 3d

43, 48, 606 N.E.2d 1001 (3d Dist. 1992). In the product liability context, the statute of limitations

begins running at the time of the transaction and not on the date that the defect manifested and

caused damage. Val Decker, 411 F.2d at 851 (in a case involving an allegedly defective storage

facility that damaged the defendant’s products, finding that the statute of limitations began

running on “the date on which installation [of the storage facility] was completed and not the date

of discovery of the spoilage”).

In contrast, implied warranty in tort claims are subject to a two-year statute of limitations

that begins running when “the injury or loss to person or property occurs.” Ohio Rev. Code §

2305.10(A)–(B); U.S. Fid. & Guar. Co. v. Truck & Concrete Equip. Co., 21 Ohio St. 2d 244, 252,

257 N.E.2d 380 (1970). For implied warranty in tort claims based on defective products, Ohio

courts have held that the loss occurs at the point at which the alleged defect manifests, rather than

the point at which the sale is made. See U.S. Fid. & Guar. Co., 21 Ohio St. 2d, syllabus (stating

that, in a products liability case involving an allegedly defective truck part, the plaintiff’s implied

warranty in tort claim arose on the day that the alleged defect manifested and damaged the truck). 

Where, as here, the alleged defect manifests outside of the UCC’s four-year period, PCNA

argues that this system creates a discrepancy because the secondhand purchaser is essentially

afforded a longer warranty period than the original purchaser. Although the original purchaser

would be barred from bringing an implied warranty claim four years after his or her purchase, the

remote purchaser may bring one at any point, so long as he or she brings the action within two

years after the defect manifests. PCNA argues that Ohio Plaintiffs should not be permitted to

pursue damages that are not available to firsthand purchasers in privity with PCNA. 

101

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 101 of 131 PAGEID #:

 <pageID>
The Court recognizes the oddity of a remote purchaser having a longer period in which to

file suit for a defective product than an original purchaser. But courts in some jurisdictions

disallow purchasers from recovering economic loss in tort for precisely this reason—to prevent

those purchasers from avoiding the UCC’s provisions and restrictions—while Ohio courts have

consistently allowed individual consumers to recover economic loss in tort. Compare Chemtrol,

42 Ohio St. 3d at 49 (noting that Ohio courts allow remote purchasers to recover economic loss in

tort) with Neibarger, 486 N.W.2d at 618 (stating that, if purchasers were allowed to sue in tort to

recover economic loss, “the UCC provisions designed to govern such disputes, which[, inter

alia,] limit the time in which such a suit must be filed, could be entirely avoided”). The Ohio

Supreme Court has acknowledged the fact that UCC claims and implied warranty in tort claims

are subject to a different statute of limitations, even where the plaintiffs seek to recover the same

economic loss, and has not evinced an intent to standardize the two claims for relief. See U.S.

Fid. & Guar. Co., 21 Ohio St. 2d 244 at 251. The court has also declined to extend the

availability of implied warranty in tort claims to firsthand purchasers, which would have

harmonized the discrepancy that PCNA highlights. See Chemtrol, 42 Ohio St. 3d at 49. In its

opinion, the Chemtrol court emphasized the fact that parties in privity are able to bargain for the

quality of goods that they will receive and that remote purchasers must rely on the added

protection of implied warranty in tort. See id. at 49. Without some indication that the Ohio

Supreme Court would limit a remote purchaser’s right to bring a tort action to the UCC’s fouryear statute of limitations, the Court declines to impose this requirement. 

Finding that Ohio Plaintiffs’ claims are not time-barred, the Court turns to the substance

of their implied warranty claim. Plaintiffs bringing implied warranty in tort claims must allege

that (1) a defect existed in a defendant’s product that made it unfit for its ordinary, intended use;

102

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 102 of 131 PAGEID #:

 <pageID>
(2) the defect existed at the time the product left the defendant’s possession; and (3) the defect

was the proximate cause of the plaintiff’s injuries. White v. DePuy, Inc., 129 Ohio App. 3d 472,

480, 718 N.E.2d 450 (12th Dist. 1998) (quoting Temple v. Wean United, 50 Ohio St. 2d 317, 321,

364 N.E.2d 267 (1977)). The parties dispute whether a reasonable consumer would find that the

alleged defect rendered the Cayenne unfit for its ordinary, intended use. 

PCNA argues that no reasonable consumer could conclude that the alleged coolant tube

defect rendered Ohio Plaintiffs’ vehicles unfit for their ordinary, intended use when the Cayennes

outlived their warranties. PCNA does not cite any Ohio authority in support of its position but

instead cites Daugherty v. American Honda Motor Co. and Clemens v. DaimlerChrysler Corp. for

the proposition that reasonable consumers understand that the ordinary useful life of a product is

limited by its express warranty. PCNA argues that the Ohio doctrine of implied warranty in tort

is similar to California’s Consumer Legal Remedies Act in that both causes of action “assign

liability when a defendant withholds information that is ‘likely to mislead a reasonable

consumer.’ ” (ECF No. 91, at 85 (citing Wilson, 668 F.3d at 1141–43).) 

Assuming arguendo that PCNA’s comparison of Ohio and California law is accurate in

this context, PCNA’s argument fails. The Court found in Section IV(B) of this Opinion and

Order (Count Two) that California Plaintiffs had sufficiently pleaded facts to suggest that PCNA

withheld information regarding safety risks and therefore violated a duty to disclose under

Daugherty. See supra Section IV(B) (Count Two); cf. Clemens v. DaimlerChrysler Corp., 534

F.3d at 1026–27. PCNA does not assert any additional arguments in support of its position. 

The Court finds that Ohio Plaintiffs state a claim for breach of implied warranty in tort. 

Accordingly, the Court DENIES PCNA’s motion to dismiss Count Twenty-Four of Plaintiffs’

Complaint. 

103

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 103 of 131 PAGEID #:

 <pageID>
Count Twenty-Five: Ohio’s Consumer Sales Practices Act 

The Ohio Consumer Sales Practices Act (“OCSPA”) provides that “[n]o supplier shall

commit an unfair or deceptive act or practice in connection with a consumer transaction.” Ohio

Rev. Code § 1345.02(A). “Such an unfair or deceptive act or practice by a supplier violates this

section whether it occurs before, during, or after the transaction.” Id. Plaintiffs bringing OCSPA

claims must allege that the defendant performed an act or omission that was unfair or deceptive,

and that the alleged act “impacted [the plaintiffs’] decision to purchase the item at issue.” Temple

v. Fleetwood Enters., Inc., 133 F. App’x 254, 265 (6th Cir. 2005).

Plaintiffs bringing class actions under the OCSPA are subject to the statute’s class action

notice requirement. Under the OCSPA, consumers may seek relief in a class action only if the

defendant was sufficiently on notice that its conduct was deceptive or unconscionable under the

statute at the time it committed the alleged acts. Ohio. Rev. Code § 1345.09(B);18 Marrone v.

Phillip Morris USA, Inc., 110 Ohio St. 3d 5, 2006-Ohio 2869, 850 N.E.2d 31, ¶ 1. Plaintiffs

18Section 1345.09(B) provides: 

Where the violation was an act or practice declared to be deceptive or

unconscionable by rule adopted under division (B)(2) of section 1345.05 of the

Revised Code before the consumer transaction on which the action is based, or an act

or practice determined by a court of this state to violate section 1345.02, 1345.03, or

1345.031 of the Revised Code and committed after the decision containing the

determination has been made available for public inspection under division (A)(3)

of section 1345.05 of the Revised Code, the consumer may rescind the transaction

or recover, but not in a class action, three times the amount of the consumer's actual

economic damages or two hundred dollars, whichever is greater, plus an amount not

exceeding five thousand dollars in noneconomic damages or recover damages or

other appropriate relief in a class action under Civil Rule 23, as amended.

Ohio Rev. Code § 1345.09(B). See Amato v. Gen. Motors Corp., 11 Ohio App. 3d 124, 130, 463

N.E.2d 625 (8th Dist. 1982) (interpreting Section 1345.09(B)). 

104

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 104 of 131 PAGEID #:

 <pageID>
bringing claims on behalf of a class must demonstrate that either (1) the alleged violation is an act

or practice that was declared to be deceptive or unconscionable by a rule adopted by the Attorney

General before the consumer transaction on which the action is based or (2) the alleged violation

is an act or practice that was determined by a court to violate the OCSPA and the court’s decision

was available for inspection before the transaction took place. Ohio. Rev. Code §1345.09(B). 

The alleged conduct must be “substantially similar” to an act or practice previously declared to be

deceptive under the OCSPA in order for the action to proceed as a class. Marrone, 110 Ohio St.

3d ¶ 2. 

To bring a claim on behalf of a putative class, a plaintiff must identify in his or her

complaint the rule or case that satisfies Section 1345.09(B)’s notice requirement. See Johnson v.

Microsoft Corp., 155 Ohio App. 3d 626, 2003-Ohio-7153, 802 N.E.2d 712, ¶ 20 (1st Dist.), aff’d

on other grounds, 106 Ohio St. 3d 278, 2005-Ohio-4985, 834 N.E.2d 791. In Johnson, the trial

court dismissed a plaintiff’s OCSPA class action because she failed to plead the requisite notice

elements under Section 1345.09(B). Id. at paragraph five of the syllabus. The plaintiff argued on

appeal that the trial court “required her to plead with a higher degree of specificity than that called

for under the general rule.” Id. ¶ 20. The appellate court expressly rejected this argument and

affirmed the trial court’s dismissal, noting that the plaintiff failed to plead either of the elements

that would satisfy Section 1345.09(B). Id. The Johnson court’s holding is datum for analyzing

Ohio law and disposes of Ohio Plaintiffs’ argument that Section 1345.09(B) is only relevant at the

class certification stage.19

19See also Kline v. Mortgage Elec. Sec. Sys., No. 08-408, 2010 WL 6298271, at *4 (S.D.

Ohio Dec. 30, 2010) (dismissing a plaintiffs’ complaint under Rule 12(b)(6) and stating that “

‘[l]ack of prior notice’ that a practice has been deemed deceptive or unconscionable in

accordance with Section 1345.09(B) ‘requires dismissal of class action allegations’ brought

105

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 105 of 131 PAGEID #:

 <pageID>
 If a plaintiff fails to identify a rule or case in his or her complaint that satisfies Section

1345.09(B), dismissal of the claim as a class action is proper and the plaintiff may proceed in his

or her individual capacity alone. See Volbers-Klarich v. Middletown Mgmt., Inc., 125 Ohio St. 3d

494, 2010-Ohio-2057, 929 N.E.2d 434, ¶ 33. In Volbers-Klarich, the plaintiff brought an OCSPA

claim on behalf of a putative class and alleged that the defendant deceptively imposed a nonexistent city and municipal tax on its customers. Id. ¶ 3. The plaintiff alleged that Ohio’s general

rule against false advertising put the defendants on notice that their conduct was unlawful. Id. ¶

33. The Ohio Supreme Court rejected this argument, finding that general rules are not sufficient

to put a reasonable person on notice that a specific act or practice is prohibited. Id. The court

affirmed the lower court’s dismissal of the plaintiff’s class-action claim at the pleading stage and

noted that the plaintiff could advance her claim “only as an individual.” Id. at ¶ 34. 

under the OCSPA”) (citing St. Clair v. Kroger Co., 581 F. Supp. 2d 896, 901 (N.D.Ohio 2008));

Bower v. Int’l Bus. Machs., Inc., 495 F. Supp. 2d 837, 841 (S.D. Ohio 2007) (“The [p]laintiffs

have failed to identify in their complaint a rule or judgment that would place the [d]efendant on

notice that the conduct alleged by the [p]laintiffs violated the [O]CSPA; consequently pursuit of

this claim as a class action is improper.”); City of Findlay v. Hotels.com, 441 F. Supp. 2d 855,

863 (N.D. Ohio 2006) (citing Johnson and dismissing an OCSPA class action class for failing to

allege the two prerequisites set forth in Section 1345.09(B)). But see In re Whirlpool Corp.

Front-Loading Washer Prods. Liab. Litig., 684 F. Supp. 2d 942, 948 (N.D. Ohio 2009) (finding

that Section 1345.09(B) is more appropriately addressed at the class certification stage); Lilly v.

Hewlett-Packard Co., No. 1:05-CV-465, 2006 U.S. Dist. LEXIS 22114, at *17 (S.D. Ohio Apr.

21, 2006) (same). The Lilly court cited Johnson but declined to follow it, stating that “the actual

basis” for the Johnson court’s affirmance of the trial court’s decision rested on other grounds. 

Lilly, 2006 U.S. Dist. LEXIS 22114, at *17. Given the fact that the Johnson court expressly

“disagreed” with the plaintiff’s argument that the trial court required her to plead her claim with

a higher level of specificity than the statute required, the Court finds this reasoning unpersuasive. 

See Johnson, 155 Ohio App. 3d ¶ 20. Similarly, the Whirlpool court declined to consider the

class action plaintiff’s notice allegations at the pleading stage, reasoning that the plaintiffs could

still proceed as individuals even if they failed to plead the requisite notice. 684 F. Supp. 2d at

948. The Ohio Supreme Court confronted this exact situation in Volbers-Klarich v. Middletown

Mgmt., Inc., 125 Ohio St. 3d 494, 2010-Ohio-2057, 929 N.E.2d 434, ¶ 33 and affirmed the trial

court’s dismissal of the plaintiff’s class action allegations at the pleading stage. 

106

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 106 of 131 PAGEID #:

 <pageID>
The Court will therefore examine Ohio Plaintiffs’ allegations of prior notice to determine

whether they may pursue their claim on behalf of a class. Ohio Plaintiffs allege that two court

cases—Lilly v. Hewlett-Packard Co., No. 1:05-CV-465, 2006 U.S. Dist. LEXIS 22114 (S.D. Ohio

Apr. 21, 2006) and Mason v. Mercedes Benz USA, LLC, 8th Dist. No. 85031, 2005 Ohio App.

LEXIS 3911 (Aug. 18, 2005)—put PCNA on notice that its alleged conduct violated the OCSPA. 

Federal district court cases such as Lilly, however, cannot supply the requisite notice under

Section 1345.09(B). See Kline v. Mortgage Elec. Sec. Sys., No. 3:09-cv-408, 2010 WL 6298271,

at *6 (S.D. Ohio Dec. 30, 2010) (“[T]he Court cannot logically conclude that by referring to

decisions of ‘a court of this state,’ the Ohio legislature intended to allow a federal court sitting in

Ohio to define the parameters of ‘deceptive or unconscionable’ practices under Ohio’s Consumer

Sales Practices Act.”). 

Ohio Plaintiffs are therefore left with Mason v. Mercedes Benz, in which the defendant

allegedly placed a vehicle in the stream of commerce that was afflicted with a “multitude of

different problems” that “required [the plaintiff] to have the car in for repairs twenty times over a

two-year period.” 2005 Ohio App. LEXIS 3911, at *33. The court found that such facts

supported a verdict of breach of the implied warranty of merchantability (which in turn supported

an OCSPA claim) because the plaintiff’s faith in her vehicle was “so undermined by its constant

problems” that she had to purchase another vehicle. Id. at 34. The Mason court implicitly

suggested that its decision rested on the fact that the vehicle contained multiple defects and

required continuous repairs; the court distinguished cases in which the product contained a single

or small number of defects. See id. at *33. The conduct alleged in Mason is therefore unlike the

conduct alleged here, in which PCNA allegedly placed a vehicle into the stream of commerce

with one defect that required repair on one occasion. The Court declines to consider the

107

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 107 of 131 PAGEID #:

 <pageID>
additional cases that Ohio Plaintiffs provide in their opposition memorandum that are not

identified in their Complaint. See Pa. ex rel. Zimmerman, 836 F.2d at 181 (“[I]t is axiomatic that

the complaint may not be amended by the briefs in opposition to a motion to dismiss.” (internal

quotations omitted)). Ohio Plaintiffs fail to satisfy the requirements of Section 1345.09(B). 

Because Ohio Plaintiffs fail to satisfy Section 1345.09(B), they are precluded from

advancing an OCSPA claim on behalf of a class. The Court GRANTS PCNA’s motion to

dismiss Ohio Plaintiffs’ OCSPA class action allegations. 

The Court next examines the substance of Ohio Plaintiffs’ OCSPA claim to determine

whether they, in their individual capacities, have stated claims for relief. Ohio Plaintiffs allege

that PCNA violated the OCSPA by breaching the implied warranty in tort, failing to disclose the

alleged coolant tube defect to consumers and affirmatively misrepresenting the quality of the

Cayenne. The Court finds that Ohio Plaintiffs state an OCSPA claim premised on PCNA’s

alleged failure to disclose material facts but fail to state an OCSPA claim based on affirmative

representations.

The Court first disposes of Ohio Plaintiffs’ allegations regarding affirmative

representations. To bring an OCSPA claim premised on affirmative conduct, a plaintiff must

allege that he “saw or was . . . aware of the alleged misrepresentations at any time before or

during the purchase of the [allegedly defective product].” Lilly, 2006 WL 1064063, at *5

(dismissing a plaintiff’s OCSPA claim for failing to establish the requisite “cause and effect”

relationship). Like their co-plaintiffs, Ohio Plaintiffs do not allege that they saw, heard, or were

aware of PCNA’s purported misrepresentations at any given time. See supra Section III(B). The

Court therefore GRANTS PCNA’s motion to dismiss Count Twenty-Five of Plaintiffs’

Complaint to the extent it is premised on allegations of affirmative misrepresentations. 

108

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 108 of 131 PAGEID #:

 <pageID>
Ohio Plaintiffs’ remaining allegations are based on PCNA’s alleged failure to disclose

material facts to consumers.20 Omissions are actionable under the OCSPA if they “concern a

matter that is or is likely to be material to a consumer’s decision to purchase the product or

service involved.” Temple, 133 F. App’x at 265–66 (citing Richards v. Beechmond Volvo, 127

Ohio App. 3d 188, 190, 711 N.E.2d 1088 (1st Dist. 1998)). PCNA cites, inter alia, Daugherty v.

American Honda Motor Co. and Eisert v. Kantner, 3d Dist. No. 2-10-13, 2010 WL 3836205, at

*2 (Oct. 4, 2010), for the proposition that defendants do not have a duty to disclose to consumers

defects that will require post-warranty repairs. But the Court declined to dismiss California

Plaintiffs’ claims under Daugherty, finding instead that California Plaintiffs had sufficiently

alleged facts to demonstrate that the alleged defect presents a safety concern such that PCNA

violated a duty to disclose. See supra Section IV(B) (Count Two). The Eisert court did not

confront the issue of safety concerns and is therefore not persuasive on this point. See 2010 WL

3836205, at *1–6 (analyzing an OCSPA claim in which the plaintiffs alleged that the defendant’s

faulty construction caused a moldy/musty smell in their home). Absent authority that would put

such an omission outside the scope of the OCSPA, the Court declines to dismiss Ohio Plaintiffs’

claim on this ground. 

The Court finds that Ohio Plaintiffs state a claim in their individual capacities for

violations of the OCSPA premised on PCNA’s alleged failure to disclose material facts. The

Court therefore DENIES PCNA’s motion to dismiss these allegations. The Court GRANTS IN

PART and DENIES IN PART PCNA’s motion to dismiss Count Twenty-Five of Plaintiffs’

20Ohio Plaintiffs assert that their claim also rests on PCNA’s breach of the implied

warranty in tort but do not differentiate this allegation from their allegation that PCNA failed to

disclose a material fact to consumers for purposes of OCSPA liability. The Court therefore

considers these allegations as one theory of liability under the OCSPA. 

109

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 109 of 131 PAGEID #:

 <pageID>
Complaint. 

Count Twenty-Six: Negligence (Ohio)

Ohio Plaintiffs assert that PCNA breached its duty to design and manufacture the Cayenne

in such a way as to ensure that it would not leak coolant and require substantial repair costs

unreasonably early in its usable life. The Court finds that Ohio Plaintiffs state a claim for

negligence. 

The parties agree that Ohio courts recognize the economic loss doctrine as it relates to

commercial plaintiffs in privity with the defendant—in other words, such plaintiffs cannot

recover damages in tort for purely economic loss. See Chemtrol, 42 Ohio St. 3d at 45–46. The

Ohio Supreme Court summarized one of the theories underlying the economic loss rule as

follows: “where the buyer and seller are in privity of contract, and they have negotiated that

contract from relatively equal bargaining positions, the parties are able to allocate the risk of all

loss, including loss of the subject product itself, between themselves.” Id. In such a situation, the

economic loss rule applies to maintain the boundary between tort and contract. See id. 

In discussing the theories underlying the economic loss doctrine, the Chemtrol court

distinguished parties in privity from those not in privity, stating, “[f]or an ordinary consumer, i.e.,

one not in privity of contract with the seller or manufacturer against whom recovery is sought, an

action in negligence may be an appropriate remedy to protect the consumer’s property interests.” 

Id. at 45–46. Ohio Plaintiffs and PCNA dispute whether the economic loss doctrine bars tort

claims of individual consumers not in privity with the defendant. 

 Allowing Ohio Plaintiffs’ negligence claim to proceed would represent the minority view

among courts in other jurisdictions. See, e.g., supra Sections IV(C) (Count Six); IV(G) (Counts

Sixteen & Nineteen); infra Section IV(K) (Count Twenty-Nine). The Ohio Supreme Court has,

110

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 110 of 131 PAGEID #:

 <pageID>
however, acknowledged that it aligns itself with a minority of courts in permitting consumers to

recover economic loss in tort. See, e.g., Chemtrol, 42 Ohio St.3d at 48 (explaining that prior

decisions of the Ohio Supreme Court appear to favor the minority approach of Santor v. A&M

Karagheusian, Inc. in permitting individual plaintiffs to recover economic through implied

warranty in tort and strict liability theories of recovery); LaPuma v. Collinwood Concrete, 75

Ohio St. 3d 64, 67, 661 N.E.2d 714 (1996) (permitting recovery in tort for economic loss to the

product itself where there was no privity between the plaintiff and the supplier); Avery Dennison

Corp. v. Soliant LLC, No. 1:04CV1865, 2005 U.S. Dist. Lexis 17672, at *6 (N.D. Ohio Aug. 23,

2005) (citing LaPuma for the proposition that “Ohio courts continue to permit product liability

claims by individual consumers for purely economic losses” and noting that such a position

represents the minority view among courts). 

District courts in Ohio, relying on Chemtrol, have permitted individual consumers to bring

negligence claims for purely economic loss against a manufacturer with whom they are not in

privity of contract. See In re Whirlpool Corp. Front-Loading Washer Prods. Liab. Litig., 684 F.

Supp. 2d 942, 951 (N.D. Ohio 2009) (denying the defendant’s motion to dismiss a putative class

action claim for negligence against a remote manufacturer and finding that, in Ohio, “the

foundational doctrinal distinction in the economic loss rule jurisprudence is whether the parties

are in privity of contract”). Another district court in Ohio recently agreed with the Whirlpool

court’s holding on this point, stating that “in cases where ‘the parties are not in privity of contract,

[Ohio] courts apply a more relaxed rule, allowing individual consumers to bring negligence

claims for solely economic injuries.’ ” Hale v. Enerco Group., Inc., No. 1:10-cv-00867, 2011

U.S. Dist. LEXIS 781, at *19–20 (N.D. Ohio Jan. 5, 2011) (citing In re Whirlpool, 684 F. Supp.

2d at 949–50). 

111

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 111 of 131 PAGEID #:

 <pageID>
In allowing the individual plaintiffs’ negligence claim to proceed, the Whirlpool court

rejected the case of Lee v. Chrysler Corp. as “one summary misapplication of Chemtrol [that]

cannot override the otherwise consistent holdings of Ohio courts that absent privity, consumer

plaintiffs may bring a negligence action for economic losses.” In re Whirlpool, 684 F. Supp. 2d

at 951 (discussing Lee, 5th Dist. No. 2004CA00164, 2005 WL 449762, at *2 (Feb. 22, 2005)). In

Lee, an Illinois appellate court purported to extend the reach of the economic loss doctrine to

consumers lacking privity but offered no analysis in doing so. See Lee, 2005 WL 449762, at *3–4

(Hoffman, J., dissenting) (noting that the majority failed to acknowledge the Chemtrol court’s

holding that the economic loss doctrine applies only to parties in privity of contract). This Court

agrees with Ohio Plaintiffs that Lee is unpersuasive on this point. See West, 311 U.S. at 237

(suggesting that an intermediate appellate state court’s decision is controlling only if the court

“rests its considered judgment upon the rule of law which it announces”). 

PCNA’s remaining arguments are equally unpersuasive. PCNA does not offer any

authority in which Ohio courts applied the economic loss doctrine to bar an individual

purchaser’s tort claim against a remote manufacturer. Instead, PCNA argues that Chemtrol

necessitates a “nuanced analysis” in determining whether a remote purchaser may bring a tort

claim to recover economic loss. (ECF No. 91, at 99.) PCNA argues that Ohio law extends

numerous remedies to consumer-plaintiffs, such as warranty protections and protection against

deception/misrepresentation, such that a negligence action is “unnecessary and superfluous.” 

(Id.) But these remedies existed at the time of the Chemtrol decision; if their existence alone was

enough to preclude a negligence claim, the Ohio Supreme Court’s statement would have no

meaning. PCNA’s argument does not mandate dismissal of Ohio Plaintiffs’ claim at this stage of

the litigation. 

112

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 112 of 131 PAGEID #:

 <pageID>
As a final argument, PCNA cites Potts v. Safeco Insurance Co. for the proposition that “in

the absence of privity of contract between two disputing parties the general rule is there is no . . .

duty to exercise reasonable care to avoid intangible economic loss or losses to others that do not

arise from tangible physical harm to persons and tangible things.” 5th Dist. No. 2009CA0083,

2010 WL 1839738, at *4 (May 3, 2010) (internal quotations omitted) (citing Floor Craft Floor

Covering, Inc. v. Parma Cmty. Gen. Hosp. Ass’n, 54 Ohio St. 3d 1, 3, 560 N.E.2d 206 (Ohio

1990)). The question in the products liability context is not whether manufacturers have a duty

that extends to the remote purchaser; the various cases in which Ohio courts have allowed remote

purchasers to pursue product liability claims against a manufacturer confirms that they do. See,

e.g., LaPuma, 75 Ohio St. 3d at 67. The language in Floor Craft and the cases citing it does not

apply to the facts of this case. 

 Here, Ohio Plaintiffs suffered property damage in that they purchased a product that

damaged itself. Courts in most jurisdictions would preclude Ohio Plaintiffs from recovering this

loss in tort; however, Ohio courts permit consumers to advance tort theories seeking recovery of

these damages. PCNA fails to meet its burden on this motion to dismiss. 

The Court finds that Ohio Plaintiffs state a claim for negligence and DENIES PCNA’s

motion to dismiss Count Twenty-Six of Plaintiffs’ Complaint. 

Count Twenty-Seven: Deceptive Trade Practices (Ohio)

 Ohio Plaintiffs allege that PCNA violated the Ohio Deceptive Trade Practices Act

(“ODTPA”) by misrepresenting the quality and characteristics of the Cayenne in such a way as to

cause harm to Ohio Plaintiffs. The Court predicts that the Ohio Supreme Court would dismiss

Ohio Plaintiffs’ ODTPA claim for lack of standing.

The ODTPA proscribes certain “deceptive trade practices” such as passing off goods or

113

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 113 of 131 PAGEID #:

 <pageID>
services as those of another and causing likelihood of confusion or misunderstanding as to the

source, sponsorship, approval or certification of goods or services. Ohio Rev. Code. §

4165.02(A)(1) & (2). Section 4165.03 of the ODTPA confers standing on a “person who is likely

to be damaged by a person who commits a deceptive trade practice” or a “person who is injured

by a person who commits a deceptive trade practice.” Id. § 4165.03(A)(1) & (2). The ODTPA

defines “person” as an “individual, corporation, government . . . or any other legal or commercial

entity.” Id. § 4165.01(D). 

Despite this language, an Ohio court of appeals has held that consumers do not have

standing to bring a ODTPA claim. Dawson v. Blockbuster, Inc., 8th Dist. No. 86451, 2006 WL

1061769, at *4 (Mar. 16, 2006), cert denied, 110 Ohio St. 3d 1442, 2006-Ohio-3862, 852 N.E.2d

190 (Ohio 2006). The court reasoned that the ODTPA is “substantially similar to Section 43(a) of

the Lanham Act” and that the Lanham Act protects the interests of a purely commercial class that

does not include individual consumers. Dawson, 2006 WL 1061769, at *3 (citing Yocono’s Rest.,

Inc. v. Yocono, 100 Ohio App. 3d 11, 17, 651 N.E.2d 1347 (9th Dist. 1994)). See also Chandler

& Assoc. v. Am. Healthcare Alliance, 125 Ohio App. 3d 572, 580, 709 N.E.2d 190 (8th Dist.

1997) (“When adjudicating claims under the [ODTPA], Ohio courts shall apply the same analysis

applicable to claims commenced under analogous federal law.”). 

Similar to the ODTPA, Section 43(a) of the Lanham Act confers standing on “any person

who believes that he or she is likely to be damaged” by prohibited conduct under the Act. 15

U.S.C.A. § 1125(a). Despite this language, federal courts have consistently held that individual

consumers do not have standing under this section because they are not within the class of

persons that the Lanham Act was designed to protect. See, e.g., Colligan v. Activities Club of

N.Y., Ltd., 442 F.2d 686, 694 (2d Cir. 1971) (holding that individual consumers do not have

114

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 114 of 131 PAGEID #:

 <pageID>
standing to sue under the Lanham Act because “[t]he Act’s purpose, as defined in § 45, is

exclusively to protect the interests of a purely commercial class against unscrupulous commercial

conduct”); Made in the USA Found. v. Phillips Foods, Inc., 365 F.3d 278, 281 (4th Cir. 2004)

(same). Applying this logic to the ODTPA, the Dawson court affirmed the district court’s

dismissal of an individual consumer’s ODTPA claim. 2006 WL 1061769, at *4 (“At least half of

the circuits hold (and none of the others disagree) that § 45 of the Lanham Act, 15 U.S.C.S. §

1051 et seq., specifically 15 U.S.C.S. § 1127, bars a consumer from suing under the act.”). 

The Court finds that Dawson mandates dismissal of Ohio Plaintiffs’ ODTPA claim. In so

holding, the Court declines Ohio Plaintiffs’ invitation to ignore Dawson and instead follow Bower

v. International Business Machines, Inc., in which the court held that individual consumers have

standing under the ODTPA. 495 F. Supp. 2d 837, 843 (S.D. Ohio 2007). The Court declines to

adopt Bower’s holding on this point for four reasons. 

First, Dawson is well reasoned and therefore is datum for ascertaining state law, not to be

disregarded unless this Court is persuaded that the Ohio Supreme Court would decide otherwise. 

West, 311 U.S. at 237. Dawson’s holding is supported by Ohio cases that equate the ODTPA to

the Lanham Act in all material respects. See Dawson, 2006 WL 1061769, at *4 (citing Yocono’s

Rest., Inc. v. Yocono and Chandler for the proposition that courts should interpret the ODTPA in

the same way that courts interpret the Lanham Act). The Dawson court analyzed the federal

cases interpreting the Lanham Act and unequivocally ruled on the issue that is currently before

this Court. See Dawson, 2006 WL 1061769, at *4. 

Second, the Bower court did not cite or mention Dawson and referenced only two cases,

both from the Northern District of Ohio, for the proposition that consumers do not have standing

under the ODTPA. Bower, 495 F. Supp. 2d at 842 (stating that the defendants “rely exclusively”

115

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 115 of 131 PAGEID #:

 <pageID>
on Chamberlain v. American Tobacco Co., No. 1:96-CV-02005, 1999 WL 33994451 (N.D. Ohio

Nov. 19, 1999) and Glassner v. R.J. Reynolds Tobacco Co., No. 5:99CV0796, 1999 WL

33591006 (N.D. Ohio June 19, 1999) for the proposition that the ODTPA does not apply to

individual consumers). The court concluded that both of these cases had “limited precedential

value” and declined to follow them. Id. In contrast to these cases, Dawson has significant

precedential value and provides well-reasoned support for the holding that the Chamberlain and

Glassner courts reached.

Third, the Bower court’s (as well as Ohio Plaintiffs’) reliance on the ODTPA’s plain

language ignores the fact that numerous federal courts have interpreted the Lanham Act in a way

that appears contrary to its plain language. 15 U.S.C.A. § 1125(a) (conferring standing on “any

person who believes that he or she is likely to be damaged” by prohibited conduct under the Act). 

The Bower court did not address this issue and does not mention the Lanham Act in its opinion. 

Finally, at least one Ohio state court and another district court in Ohio have expressly

declined to follow Bower and have followed Dawson instead. See, e.g., Blankenship v. CFMOTO

Powersports, Inc., 944 N.E.2d 769, 776–77 (Clermont Cty. Ct. Com. Pl. 2011) (addressing Bower

but adopting Dawson’s interpretation of the ODTPA); Robins v. Global Fitness Holdings, LLC,

No. 1:11 CV 1373, 2012 WL 163031, at *15 (N.D. Ohio Jan. 18, 2012) (“The Court disagrees

with Bower and adopts the Dawson/Chamberlain interpretation of the [O]DTPA.”). In

Blankenship, the court noted that the ODTPA and OCSPA “prohibit the same type of conduct”

such that it makes sense that the ODTPA protects only commercial entities; to hold otherwise

would render the OCSPA “superfluous.” 944 N.E.2d at 776–77. 

The Court predicts that the Ohio Supreme Court would adopt the reasoning of Dawson

and conclude that individual consumers lack standing under the ODTPA. The Court finds that

116

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 116 of 131 PAGEID #:

 <pageID>
Ohio Plaintiffs, as individual consumers, fail to state a claim under the ODTPA. Accordingly, the

Court GRANTS PCNA’s motion to dismiss Count Twenty-Seven of Plaintiffs’ Complaint. 

K. TEXAS

Texas Plaintiffs Randall Stuewe and Sven Wust purchased Cayennes from unidentified

sellers in 2006 (Stuewe) and 2003 (Wust). The coolant tubes in Plaintiff Stuewe’s vehicle failed

in 2011, and the tubes in Plaintiff Wust’s vehicle failed in 2010. Both Texas Plaintiffs’ vehicles

were allegedly rendered disabled following the coolant tube failure, and both Texas Plaintiffs

paid to repair their vehicles. Neither Texas Plaintiff alleges any facts surrounding the purchase of

his Cayenne such as the price paid for the vehicle or the identity of the seller. 

Texas Plaintiffs now brings claims for breach of implied warranty under the UCC,

negligence, violations of Texas’ Deceptive Trade Practices Act, Tex. Bus. & Com. Code § 17.41

et seq., and unjust enrichment. PCNA moves to dismiss all claims. 

Count Twenty-Eight: Breach of Implied Warranty (Texas) 

 Texas Plaintiffs, similar to many of their co-plaintiffs, bring a claim for breach of implied

warranty under the UCC. PCNA does not offer any arguments specific to Texas Plaintiffs’ claim

and adopts only those arguments that it advanced in connection with Plaintiffs’ Magnuson-Moss

claim. Specifically, PCNA argues that any implied warranties had expired by the time the alleged

defect manifested in Texas Plaintiffs’ vehicles. The Court rejected these arguments in Section

IV(A)(2)(b) of this Opinion and Order (Count One) and found that Plaintiffs had alleged

sufficient facts to suggest that the durational limitation was unconscionable. See supra Section

IV(A)(2)(b) (Count One). Thus, the Court finds that Texas Plaintiffs state a claim for breach of

implied warranty. The Court DENIES PCNA’s motion to dismiss Count Twenty-Eight of

Plaintiffs’ Complaint. 

117

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 117 of 131 PAGEID #:

 <pageID>
Count Twenty-Nine: Negligence (Texas)

Texas Plaintiffs allege that PCNA negligently designed the cooling system in its Cayennes

and that Texas Plaintiffs sustained damages as a result. The Court finds that the economic loss

doctrine bars Texas Plaintiffs’ claims. 

In Texas, as in other states, the economic loss doctrine precludes plaintiffs from asserting

tort claims based on allegedly defective products when the only injury is to the product itself. See

Mem’l Harmann Healthcare Sys., Inc. v. Eurocopter Deutschland, GMBH, 524 F.3d 676, 678

(5th Cir. 2008). The Texas Supreme Court has stated that the economic loss rule applies in cases

involving defective products and that the rule applies to parties not in privity, including a remote

manufacturer and a consumer. Sharyland Water Supply Corp. v. City of Alton, 354 S.W.3d 407,

418 (Tex. 2011). In the case of defective products, the court stated that economic losses are

“more appropriately addressed through statutory warranty actions.” Id. Texas Plaintiffs’

argument that Texas courts would not apply the economic loss doctrine due to the lack of

contractual privity between the parties in this case is not persuasive.

Texas Plaintiffs do not allege that the alleged defect injured anything other than the

Cayenne itself. Accordingly, the Court finds that the economic loss doctrine bars Texas

Plaintiffs’ negligence claim. The Court GRANTS PCNA’s motion to dismiss Count TwentyNine of Plaintiffs’ Complaint. 

Count Thirty: Deceptive Trade Practices (Texas)

Texas Plaintiffs allege that PCNA violated the Texas Deceptive Trade

Practices–Consumer Protection Act (“TDTPA”) by misrepresenting the quality of the Cayenne

and failing to disclose information about the Cayenne to consumers. The Court finds that Texas

Plaintiffs state a claim under the TDTPA.

118

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 118 of 131 PAGEID #:

 <pageID>
The TDTPA proscribes “false, misleading, or deceptive acts or practices in the conduct of

any trade or commerce.” Tex. Bus. & Com. Code § 17.46(a). Under the TDTPA, a consumer

may bring a claim for relief where, inter alia, (1) the consumer relied on a false, misleading, or

deceptive act or practice to his or her detriment, (2) the defendant breached an express or implied

warranty, or (3) the defendant engaged in any unconscionable action or course of action. Id. §

17.50. Texas Plaintiffs allege that PCNA is liable under each of these three prongs.

The Court first addresses Texas Plaintiffs’ allegations of deceptive acts or practices. 

TDTPA claims that are predicated on allegations of fraud are subject to the heightened pleading

requirements of Rule 9(b). Luna v. Nationwide Prop. & Cas. Ins. Co., No. 10-2918, 2011 WL

2565354, at *3 (S.D. Tex. June 27, 2011). To the extent that Texas Plaintiffs base their TDTPA

claim on the seven affirmative mispresentations that Plaintiffs (and Texas Plaintiffs by

incorporation) identified in their Complaint, dismissal of this claim is proper. As discussed in

Section III(B) of this Opinion and Order, these allegations are fatally flawed because Plaintiffs

failed to allege the time, place, or circumstances in which PCNA allegedly made these statements. 

Texas Plaintiffs’ allegation that they relied on these misrepresentations, without more, does not

cure this deficiency. See Cataldo, 676 F.3d at 551; Culy, 2012 WL 2071804, at *6–7. The Court

therefore GRANTS Texas Plaintiffs’ TDTPA claim to the extent that it is premised on allegations

of affirmative misrepresentations. 

Texas Plaintiffs base their claim for deceptive practices on PCNA’s failure to disclose the

alleged coolant tube defect to consumers. Section 17.46(b)(24) of the TDTPA proscribes “failing

to disclose information concerning goods or services which was known at the time of the

transaction if such failure to disclose such information was intended to induce the consumer into a

transaction into which the consumer would not have entered had the information been disclosed.” 

119

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 119 of 131 PAGEID #:

 <pageID>
Id. § 17.46(b)(24). Thus, to state a claim under Section 17.46(b)(24), a consumer must allege the

following elements: “(1) a failure to disclose information concerning goods or services, (2) which

was known at the time of the transaction, (3) if such failure was intended to induce the consumer

into a transaction, (4) which the consumer would not have entered had the information been

disclosed.” Willowbrook Foods, Inc. v. Grinnell Corp., 147 S.W.3d 492, 506–07 (Tex. App.

2004). PCNA does not argue that Texas Plaintiffs failed to allege the elements of a nondisclosure

claim under the TDTPA. 

Instead, the issue before this Court is whether PCNA’s alleged nondisclosure occurred in

connection with the transactions in which Texas Plaintiffs purchased their vehicles. The Texas

Supreme Court has held that the TDTPA only reaches conduct that occurs in connection with

specific consumer transactions. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 649–50 (Tex.

1996). The court explained this requirement as follows:

The in-connection-with requirement imposes a limitation on liability that is consistent

with the underlying purposes of the [T]DTPA. Without this limitation, we would

merely substitute the defendant’s introduction of a particular product into the stream

of commerce for the conduct that was found to have violated the [T]DTPA. We find

no authority for shifting the focus of a [T]DTPA claim from whether the defendant

committed a deceptive act to whether a product that was sold caused an injury.

Id. The court reasoned that the TDTPA was not intended to reach upstream manufacturers and

suppliers when their misrepresentations are not communicated to the consumer. Id. at 649. 

Because the Amstadt defendants were “upstream suppliers” of the parts used in a plumbing

system and because their alleged misrepresentations were not communicated to consumers, the

court found that the plaintiffs could not satisfy the “in-connection-with” requirement under the

TDTPA. Id. at 647, 650–51; see also Church & Dwight Co. v. Huey, 961 S.W.2d 560, 565 (Tex.

App. 1997) (citing Amstadt and concluding that the “in connection with” requirement was met

120

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 120 of 131 PAGEID #:

 <pageID>
where the “[the manufacturer’s] marketing efforts were incorporated into [the immediate seller’s]

marketing efforts, and they formed the basis for [the plaintiff’s] decision to use the product”). 

The Amstadt court noted, however, that TDTPA liability is not limited to those defendants that

are in contractual privity with the consumer and that the focus of the inquiry is whether the

alleged misrepresentation reached the consumer and influenced his or her purchase transaction. 

919 S.W.2d at 649. 

In contrast to the Amstadt plaintiffs, Texas Plaintiffs allege that, at the time PCNA

distributed its vehicles, it concealed the defective nature of the Cayenne’s cooling system in

violation of Section 17.46(b)(24). Texas Plaintiffs assert that PCNA’s deceptive omission was

incorporated into the transactions in which they purchased their vehicles because the defect

remained undisclosed and they had no way to discover it. Texas Plaintiffs allege that they relied

to their detriment on this nondisclosure in the course of their individual transactions because, had

the alleged defect been disclosed, they would not have purchased their vehicles or would have

insisted on paying less for them. 

The Court declines to dismiss Texas Plaintiffs’ TDTPA claim at this stage of the

litigation. Texas Plaintiffs’ claim is dependent on PCNA’s allegedly deceptive conduct—on

which Texas Plaintiffs allegedly relied—and not on the injury that the allegedly defective coolant

tubes may have caused. Cf. Amstadt, 919 S.W.2d at 649–50. See also Church & Dwight Co., 961

S.W.2d at 571 (“Finding that the general and well-settled rule articulated in Amstadt protects [the

defendant] from its own misrepresentations would be a misreading of the law on this issue.”). 

Furthermore, courts in other jurisdictions have found that a defendant commits actionable

consumer fraud when it fails to inform consumers of a defect that presents a safety risk because

the defendant—by not disclosing the risk—misrepresents the safety and reliability of its product. 

121

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 121 of 131 PAGEID #:

 <pageID>
See, e.g., Daugherty, 51 Cal. Rptr. 3d at 126, Connick, 675 N.E.2d at 595. PCNA cites no case

law that would put such a misrepresentation outside the scope of the TDTPA. Because Texas

Plaintiffs allege that they relied on PCNA’s alleged misrepresentation to their detriment in their

individual transactions, the Court cannot conclude that Amstadt mandates dismissal of Texas

Plaintiffs’ claim. 

The Court finds that Texas Plaintiffs may also advance their TDTPA claim on theories of

breach of implied warranty and unconscionability. The Court found in Section IV(K) of this

Opinion and Order (Count Twenty-Eight) that Texas Plaintiffs had sufficiently alleged facts to

support an inference that the durational limitation on all implied warranties was unconscionable

and unenforceable, such that the Court cannot assume for purposes of this motion that the implied

warranty of merchantability had expired by the time the alleged defect manifested in Texas

Plaintiffs’ vehicles. PCNA notes that a plaintiff seeking to advance a claim for unconscionable

practices under the TDTPA must establish that the defendant “took advantage of the lack of

knowledge, ability, experience, or capacity of the consumer to a grossly unfair degree,” Tex. Bus.

& Com. Code § 17.45(5) (emphasis added), but PCNA fails to persuade the Court that this

standard is more narrow than the unconscionability standard that the Fourth Circuit espoused in

Carlson. Compare Daugherty v. Jacobs, 187 S.W.3d 607, 616 (Tex. App. 2006) (examining the

knowledge disparity between a consumer and seller and asking whether the resulting unfairness

was glaringly noticeable, flagrant, complete, and unmitigated) with Carlson, 883 F.2d at 296

(examining the knowledge disparity between a buyer and seller, as well as the resulting contract,

in order to determine whether the contract was procedurally and substantively unconscionable). 

Accordingly, the Court DENIES PCNA’s motion to dismiss Texas Plaintiffs’ TDTPA claim to

the extent that it is premised on PCNA’s alleged failure to disclose material facts to consumers,

122

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 122 of 131 PAGEID #:

 <pageID>
breach of implied warranty, and unconscionable acts or practices. 

The Court GRANTS IN PART and DENIES IN PART PCNA’s motion to dismiss

Count Thirty of Plaintiffs’ claim. 

Count Thirty-One: Unjust Enrichment (Texas)

In Texas, a claim for unjust enrichment is appropriate where “one party has obtained a

benefit from another by fraud, duress or the taking of an undue advantage.” Heldenfels Bros.,

Inc. v. City of Corpus Christi, 832 S.W.2d 39, 41 (Tex. 1992). A plaintiff bringing a claim for

unjust enrichment must allege a connection between the parties that could be interpreted as one

party having an implied or quasi-contractual obligation to repay the other party for benefits

conferred. Smith v. Texas, No. 2:10-CV-218-J, 2011 WL 2883402, at *6 (N.D. Tex. July 15,

2011). If a valid express contract exists and governs the subject matter at issue, there can be no

recovery upon a contract implied by law. Allen v. Berrey, 645 S.W.2d 550, 553 (Tex. App.

1982); see also Anderson v. CitiMortgage, Inc., No. 4:10-CV-398, 2011 WL 1113494, at *6 (E.D.

Tex. Mar. 24, 2011). 

Similar to their co-plaintiffs, Texas Plaintiffs assert that PCNA should reimburse them for

a portion of the price that they paid for their vehicles and for the cost of installing aluminum

coolant pipes in their vehicles because their vehicles contained a part—allegedly defective in

material—that manifested outside of the Warranty Period. Texas Plaintiffs also assert that their

claim for an “overpayment” constitutes an exception to the general rule that the existence of a

contract precludes an unjust enrichment claim. The Court rejects these arguments and finds that

Texas Plaintiffs fail to state a claim for unjust enrichment. 

Texas Plaintiffs’ vehicles are subject to the terms of the Warranties. The Warranties

define PCNA’s obligation to reimburse consumers for the cost of repairing and replacing parts

123

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 123 of 131 PAGEID #:

 <pageID>
that are defective in material. (ECF No. 62-1, at 7; 62-3, at 7; 62-5, at 6; 62-7, at 7.) Allowing

Texas Plaintiffs to recover the damages that they seek from PCNA under a theory of unjust

enrichment would improperly expand the duration and scope of these Warranties. See, e.g., In re

Gen. Motors Corp., 385 F. Supp. 2d 1172, 1176 (W.D. Okla. 2005) (interpreting Texas law and

dismissing a plaintiff’s unjust enrichment claim where the defendant allegedly concealed a design

defect because the product’s warranty covered the subject matter of the claim); accord supra

Sections IV(E) (Count Thirteen), IV(F) (Count Fifteen), IV(I) (Count Twenty-Three). Texas

Plaintiffs do not argue that the Warranties do not cover the subject matter of their claim. 

Instead, Texas Plaintiffs cite Southwestern Electric Power Co. v. Burlington Northern

Railroad Co. for the proposition that “in some circumstances, overpayments under a valid

contract may give rise to a claim for restitution or unjust enrichment.” 966 S.W.2d 467, 469

(Tex. 1998). This “exception” applies to those situations in which a party made a payment in

excess of a contract’s agreed-upon terms, not when a party is attempting to retroactively alter the

terms of a contract. Compare id. at 470 (citing a case in which a plaintiff sought to recover

money mistakenly paid in excess of a contract price as one in which an overpayment could give

rise to an unjust enrichment claim)21 with First Commodity Traders, Inc., 766 F.2d at 1011–12

21To support the claim that “in some circumstances, overpayments under a valid contract

may give rise to a claim for restitution or unjust enrichment,” the Texas Supreme Court offered

the following authority:

See, e.g., Staats v. Miller, 150 Tex. 581, 243 S.W.2d 686, 687–88 (1951) (allowing

restitution for excess money held by defendant after selling plaintiffs’ cotton

harvester pursuant to oral contract); Bowers v. Missouri, Kan. & Tex. Ry. Co., 241

S.W. 509, 510–11 (Tex.Civ.App.—Texarkana 1922, no writ) (allowing restitution

for freight charges paid in excess of rates specified in shipping contract); see also

Gulf Oil Corp. v. Lone Star Producing Co., 322 F.2d 28, 31–33 (5th Cir. 1963)

(holding that plaintiff could recover money mistakenly paid in excess of contract

price); Natural Gas Pipeline Co. v. Harrington, 246 F.2d 915, 921 (5th Cir. 1957)

124

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 124 of 131 PAGEID #:

 <pageID>
(“[Plaintiff] may not unilaterally alter the terms of the contract by now claiming unjust

enrichment.”). Texas Plaintiffs do not cite any authority for the proposition that they may use an

unjust enrichment claim to recover for an alleged overcharge arising out of the same subject

matter as that which their Warranties cover. 

 The Court finds that Texas Plaintiffs fail to state a claim for unjust enrichment. 

Accordingly, the Court GRANTS PCNA’s motion to dismiss Count Thirty-One of Plaintiffs’

Complaint. 

L. WASHINGTON

In 2007, Washington Plaintiff Ghassan Daher purchased a used 2003 Cayenne from a

Ferrari dealer in Arizona. The plastic coolant tubes in Washington Plaintiff’s vehicle cracked in

2011 and rendered his vehicle disabled. Washington Plaintiff paid to replace the coolant tubes in

his vehicle and now seeks injunctive relief and monetary damages under Washington’s Consumer

Protection Act (“WCPA”), Wash. Rev. Code § 19.86.010 et seq. PCNA moves to dismiss this

claim.

Count Thirty-Two: Washington’s Consumer Protection Act

The WCPA proscribes any “[u]nfair methods of competition and unfair or deceptive acts

or practices in the conduct of any trade or commerce.” Wash. Rev. Code § 19.86.020. To state a

claim under the WCPA, a plaintiff must allege (1) a deceptive act or practice, (2) occurring in

trade or commerce, (3) a public interest impact, (4) an injury to plaintiff in his or her business or

(holding that gas company was entitled to restitution of difference between contract

rate and price paid under invalid rate order set by regulatory board). 

Sw. Elec. Power Co., 966 S.W. 2d at 469–70. None of the courts in these cases allowed a

plaintiff to recover an overpayment from a third party with no connection to the contract. 

125

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 125 of 131 PAGEID #:

 <pageID>
property, and (5) causation. Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 719

P.2d 531, 533 (Wash. 1986). PCNA alleges that Washington Plaintiff fails to allege the first and

fifth elements of this test. 

To demonstrate unfair or deceptive conduct under the WCPA, a plaintiff must allege that a

defendant’s conduct had the capacity to deceive a substantial portion of the public or that it was

per se unfair. Id. The Washington Supreme Court has stated that “[k]nowing failure to reveal

something of material importance is deceptive within the [W]CPA.” Indoor Billboard/Wash.,

Inc. v. Integra Telecom of Wash., Inc., 170 P.3d 10, 18 (Wash. 2007) (internal citations omitted). 

Washington Plaintiff alleges that PCNA’s failure to disclose to consumers the fact that the

Cayenne’s coolant system was not of a particular standard, quality or grade constitutes a

deceptive act capable of deceiving a substantial portion of the public.22 Washington Plaintiff

further alleges that PCNA’s failure to disclose this information caused him to suffer injuries in

that, had he known of the alleged defect, he would not have purchased a Cayenne or would have

insisted on paying less for it. The Court finds that Washington Plaintiff states a claim for relief

under the WCPA. 

 In Zwicker v. Gen. Motors Corp., a Washington district court upheld a WCPA claim

based on allegations that are very similar to the allegations in this case. No. C07-0291, 2007 WL

5309204 (W.D. Wash. July 26, 2007). The plaintiffs in Zwicker alleged that the defendant

knowingly manufactured vehicles with a defective speedometer and failed to disclose the defect

to consumers. Id. at *1. The plaintiffs claimed that the faulty speedometers posed safety risks

and that, had they known of the defect, such knowledge would have impacted their purchasing

22Washington Plaintiff does not appear to incorporate Plaintiffs’ allegations of affirmative

misrepresentations into his claim. 

126

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 126 of 131 PAGEID #:

 <pageID>
decisions. Id. The defendant advanced the same arguments that PCNA advances here—that there

is nothing deceptive about failing to inform consumers of the fact that a product component may

fail within its useful life and that such a failure to disclose did not “cause” the plaintiffs’ injuries. 

Id. at *5. In rejecting these arguments, the court found that allegations of a “systematic failure of

a specific automotive part of which [defendant] was allegedly aware and concealed from the

public” were sufficient to establish a deceptive act or practice under the WCPA. Id. Similar to

PCNA, the defendant in Zwicker characterized the plaintiff’s allegations as a “failure to disclose

that a component part may fail in the future.” Id. The court rejected this characterization, noting

that “[p]laintiffs are not asserting a one-off post-warranty failure of an automobile component.” 

Id. The court went on to conclude that the plaintiffs’ allegations that “had [the defendant]

informed them about the nature of the speedometer defect they would either not have purchased

the cars or paid less for them” were sufficient to demonstrate causation under the WCPA. Id. 

The court denied the defendant’s motion to dismiss. Id. 

The Court finds that the Zwicker court’s analysis is consistent with the Washington

Supreme Court’s statement that “[k]nowing failure to reveal something of material importance is

deceptive within the [W]CPA.” See Indoor Billboard, Inc., 170 P.3d at 18. The Indoor Billboard

court’s statement also mirrors the standard that California courts use in interpreting California’s

Consumer Legal Remedies Act; the Court found that California Plaintiffs sufficiently stated a

CLRA claim on the same facts that Washington Plaintiff advances.23 See supra Section IV(B)

23 PCNA’s argument that the Zwicker court relied on Falk v. General Motors Corp.,

which the Ninth Circuit has since limited, is irrelevant. The Falk court found that a defendant

has a duty to disclose under the CLRA any defects that are “material.” 496 F. Supp. 2d at 1095;

see Wilson, 668 F.3d at 1141–43 (discussing Falk and finding that post-warranty defects are only

“material” for purposes of the CLRA if they present a safety risk to consumers). The Falk test

mirrors the standard that the Washington Supreme Court has espoused—that a defendant has a

127

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 127 of 131 PAGEID #:

 <pageID>
(Count Two). PCNA does not cite any Washington authority to negate the proposition that,

where a manufacturer fails to disclose post-warranty defects that allegedly present safety risks to

consumers and where the consumer could not have reasonably discovered such information on his

or her own, such conduct is outside the reach of the WCPA. PCNA similarly does not provide

any Washington authority negating the Zwicker court’s holding that such a failure to disclose

“caused” the consumer’s injuries when, had the consumer known the undisclosed information, it

would have affected his or her purchasing decision. PCNA’s final attempt to distinguish

Zwicker—by arguing that Washington Plaintiff failed to allege facts suggesting that PCNA had

knowledge of the alleged defect—has already been rejected by this Court. See supra Section

III(B). The Court finds that Washington Plaintiff states a claim for relief under the WCPA. 

The Court DENIES PCNA’s motion to dismiss Count Thirty-Two of Plaintiffs’

Complaint. 

V. Leave to Amend

As a final matter, the Court addresses Plaintiffs’ general request for “leave to amend” in

the alternative to their request that this Court deny PCNA’s motion. (ECF No. 77, at 180.) The

Court denies Plaintiffs’ request for leave to amend their Complaint. 

Courts in this circuit “[do] not look favorably upon bare requests for leave to amend in a

response to a motion to dismiss when the requesting party could have filed a proper motion to

amend and attached a proposed amended complaint for consideration by the court.” 

duty to disclose all “material” information to consumers. See Indoor Billboard, 170 P.3d at 18. 

Regardless of whether non-safety related defects can be “material” for purposes of the WCPA,

the Court found that California Plaintiffs had sufficiently alleged facts to meet the stricter test set

forth in Wilson. See supra Section IV(B) (Count Two). The Zwicker court’s reliance on Falk

(as opposed to Wilson) in this context is therefore inconsequential. 

128

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 128 of 131 PAGEID #:

 <pageID>
Techdisposal.com, Inc. v. CEVA Freight Mgmt, No. 2:09-cv-356, 2009 WL 4283090, at *4 (S.D.

Ohio Nov. 30, 2009). The court of appeals has explained:

Had plaintiffs filed a motion to amend the complaint prior to th[e] Court’s

consideration of the motions to dismiss and accompanied that motion with a

memorandum identifying the proposed amendments, the Court would have considered

the motions to dismiss in light of the proposed amendments to the complaint . . . . 

Absent such a motion, however, Defendant was entitled to a review of the complaint

as filed pursuant to Rule 12(b)(6). Plaintiffs were not entitled to an advisory opinion

from the Court informing them of the deficiencies of the complaint and then an

opportunity to cure those deficiencies.

PR Diamonds, Inc. v. Chandler, 364 F.3d 671, 699 (6th Cir. 2004) (quoting Bengala v. PNC

Bank, 214 F.3d 776, 783–84 (6th Cir. 2000)).

Plaintiffs’ general request for leave to amend their Complaint, in the alternative to their

request that this Court deny PCNA’s motion, is nothing more than an attempt to use the Court’s

decision as an advisory opinion enabling them to cure any deficiencies in their Complaint. See id. 

Plaintiffs have failed to follow the proper procedure for submitting a motion to amend their

Complaint; thus, this Court “will not accept [Plaintiffs] alternative argument contained in a

response to a motion to dismiss as a proper motion to amend.” Techdisposal.com, Inc., 2009 WL

4283090, at *4. The Court DENIES Plaintiffs’ request for leave to amend their Complaint. 

VI. Conclusion

For the foregoing reasons, the Court GRANTS IN PART and DENIES IN PART

PCNA’s motion to dismiss Plaintiffs’ Complaint pursuant to Rule 12(b)(6). (ECF No. 62.) The

Court takes the following action with respect to each count: 

Count One – Magnuson-Moss – GRANT as to the nationwide class’ express warranty

claim under Magnuson-Moss; DENY as to the nationwide class’ implied warranty

claim under Magnuson-Moss. California, Florida, New York, Washington, Ohio

and Georgia Plaintiffs are excluded from the nationwide class. 

129

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 129 of 131 PAGEID #:

 <pageID>
Count Two – California’s Consumer Legal Remedies Act – DENY 

Count Three – California’s Unfair Business Practices Act – DENY

Count Four – Unjust Enrichment (California) – GRANT 

Count Five – Colorado Consumer Protection Act – GRANT IN PART and DENY IN

PART

Count Six – Strict Product Liability (Colorado) – GRANT

Count Seven – Implied Warranty of Merchantability (Colorado) – DENY

Count Eight – Florida’s Deceptive and Unfair Trade Practices Act – DENY

Count Nine – Negligence (Florida) – GRANT

Count Ten – Unjust Enrichment (Florida) – GRANT 

Count Eleven – Implied Warranty of Merchantability (Georgia) – GRANT 

Count Twelve – Georgia’s Uniform Deceptive Trade Practices Act – GRANT

Count Thirteen – Unjust Enrichment (Georgia) – GRANT

Count Fourteen – Illinois Consumer Fraud and Deceptive Practices Act – GRANT IN

PART and DENY IN PART 

Count Fifteen – Unjust Enrichment (Illinois) – GRANT 

Count Sixteen – Strict Product Liability (Michigan) – GRANT 

Count Seventeen – Implied Warranty Under the UCC (Michigan) – DENY 

Count Eighteen – Michigan Consumer Protection Act – GRANT IN PART and DENY

IN PART 

Count Nineteen – Negligence (Michigan) – GRANT 

Count Twenty – New Jersey’s Consumer Fraud Act – GRANT 

Count Twenty-One – Implied Warranty of Merchantability (New Jersey) – DENY

130

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 130 of 131 PAGEID #:

 <pageID>
Count Twenty-Two – New York General Business Law – GRANT IN PART and DENY

IN PART

Count Twenty-Three – Unjust Enrichment (New York) – GRANT 

Count Twenty-Four – Breach of Implied Warranty in Tort (Ohio) – DENY 

Count Twenty-Five – Ohio’s Consumer Sales Protection Act – GRANT as to class action

allegations; GRANT IN PART and DENY IN PART as to Ohio Plaintiffs’

individual claims 

Count Twenty-Six – Negligence (Ohio) – DENY 

Count Twenty-Seven – Deceptive Trade Practices (Ohio) – GRANT 

Count Twenty-Eight – Breach of Implied Warranty of Merchantability (Texas) – DENY

Count Twenty-Nine – Negligence (Texas) – GRANT

Count Thirty – Deceptive Trade Practices (Texas) – GRANT IN PART and DENY IN

PART

Count Thirty-One – Unjust Enrichment (Texas) – GRANT 

Count Thirty-Two – Washington Consumer Protection Act – DENY 

IT IS SO ORDERED.

 /s/ Gregory L. Frost 

GREGORY L. FROST 

 UNITED STATES DISTRICT JUDGE

131

Case: 2:11-md-02233-GLF-EPD Doc #: 102 Filed: 07/19/12 Page: 131 of 131 PAGEID #:

 <pageID>