Jaguar has violated the Illinois New Vehicle Buyer Protection Act, 815 ILCS 380 (“Illinois
Lemon Law”). Jaguar seeks to dismiss counts II through IV of the complaint.
ANALYSIS

L Jurisdiction

Under the Magnuson-Moss Act, an individual buyer is entitled to file suit in federal court
if a warrantor violates a written or implied warranty or fails to meet other Magnuson-Moss Act
obligations and if the amount in controversy exceeds $50,000. Schimmer has alleged breach of
express and implied warranties and requests revocation pursuant to the Act. Schimmer also
alleges damages of at least $69,513.00. Because Schimmer’s claims meet the Magnuson-Moss
Act’s requirements for federal-jurisdiction, they are properly before the Court. Additionally,
Schimmer’s state law claim under the Illinois Lemon Law qualifies for supplemental jurisdiction
under 28 U.S.C. § 1367.
Ik. Count II is Dismissed for Lack of Privity

Section 2301(7) of the Magnuson-Moss Act dictates that a buyer may avail himself of
any implied warranties “arising under State law.” 15 U.S.C. § 2301(7). Illinois law generally
requires privity to sustain implied warranty claims when a plaintiff only alleges economic losses.
See Rothe v. Maloney Cadillac, Inc., 119 31.2d 288, 292 (1988); Szajna v. General Motors
Corp., 115 Iil.2d 294, 311-12 (1986); Connick v. Suzuki Motor Co., Ltd., 275 Ill.App.3d 705,
716-17 (1995); Devens v. Chrysler Corp., No. 87 C 8820, 1988 WL 53243 at *3 (N.D. Ill. May
18, 1988). In fact, the Illinois Supreme Court has explicitly declined to abolish the privity
requirement in implied-warranty economic loss cases. Szajna, 115 Ill.2d at 311.

The Seventh Circuit has not yet addressed the privity requirement in implied-warranty
economic loss cases brought under the Magnuson-Moss Act. Several courts in this District have

4


remedies to which he is entitled upon revocation. See id (denying summary judgment against
both dealer and manufacturer with respect to revocation counts where plaintiff met the above
pleading requirements for revocation of acceptance) (emphasis added). Schimmer has alleged
these elements. (R. 1-1, Compl. §/7, 14, 15, 17.) Accordingly, Jaguar’s motion to dismiss
Count III is denied.

IV, Repair And Replace Warranties Do Not Fall Within The Scope Of The Illinois
Lemon Law

Under the Illinois Lemon Law, if a seller fails “to conform the new vehicle to any of its
applicable express warranties,” the manufacturer either must replace the vehicle or accept return
of the vehicle. 815 ILCS 380(3)(a). The term “express warranty” has the same meaning under
the Illinois Lemon Law as it does under the Illinois UCC. 815 ILCS 380(2)(b). Under the
Illinois UCC, an express warranty is defined as:

(a) Any affirmation of fact or promise made by the seller to the
buyer which relates to the goods and becomes part of the
basis of the bargain creates an express warranty that the
goods shall conform to the affirmation or promise.

(b) Any description of the goods which is made part of the
basis of the bargain creates an express warranty that the
goods shall conform to the description.

(c) Any sample or model which is made part of the basis of the
bargain creates an express warranty that the whole of the
goods shall conform to the sample or model.

810 ILCS 5/2-313(1).

Repair and replace warranties do not fall within the Illinois UCC definition of express
warranties. Cosman v. Ford Motor Co., 285 Ill.App.3d 250, 257 (1996); Voelker v. Porsche
Cars N. Am., Inc., No. 02 C 4798, 2003 U.S. Dist. LEXIS 1898 at *6-7 (N.D. Ill. Feb. 7, 2003).

Repair and replace warranties are not viewed as promises relating to quality. Rather, repair and

7



transmission as evidenced by vibration; a defective door as evidenced by wind noise and
difficulty to close; defective alignment; and others. (Id. at 4 11.)
IL. Jaguar Made Numerous Repair Attempts to No Avail

Schimmer claims that he took the XK8 in for repairs on “numerous occasions,” including
at least four times in the first year, and that at least two of those occasions involved repairing the
same defect, which still remains uncorrected. (Id. at {{] 9-10, 50.) Schimmer further alleges that
Jaguar has failed to repair the XK8’s various defects and nonconformities, despite Jaguar’s
reasonable number of repair attempts. (Id. at] 12.) Schimmer also claims that these defects and
nonconformities “substantially impair the use, value and/or safety of the XK8,” that he has lost
confidence in the vehicle, and that Jaguar’s failure to honor its warranty has financially damaged
him. (/d. at {[7, 13, 20.)
Ill. Schimmer Attempted to Revoke His Acceptance of the XK8

Schimmer attempted to revoke his acceptance of the XK8, but J; aguar has refused to
accept his revocation. (Jd. at {| 15-17.) Jaguar also refused to provide Schimmer with any of
the remedies revocation would provide. (Id. at { 17.)
IV. Schimmer Filed the Complaint

Based on Jaguar’s above-related actions, Schimmer filed a four-count complaint against
Jaguar in the Circuit Court of Cook County on February 13, 2003. On March 17, 2003, Jaguar
removed that action to federal court. Count I alleges that Jaguar has breached its express
warranty to Schimmer in violation of the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301
(“Magnuson-Moss Act”). Count II alleges that J aguar breached the implied warranty of
merchantability in violation of the Magnuson-Moss Act. Count II alleges revocation of
acceptance pursuant to § 2310(d) of the Magnuson-Moss Act. Finally, Count IV alleges that

3


followed the Second Circuit’s interpretation of the availability of implied warranties under the
Magnuson-Moss Act in Abraham v. Volkswagen of America, 795 F.2d 238, 247-48 (2d. Cir.
1986). See Pederson v. Monaco Coach Corp., No. 02 C 7486, 2002 WL 31834679 at *1 (N.D.
Ill. Dec. 12, 2002); Kowalke v. Bernard Chevrolet, Inc., No. 99 C 7980, 2000 U.S. Dist. LEXIS
7154 at *13-14 (N.D. Ill. March 23, 2000); Soldinger Assoc., Ltd. v. Aston Martin Lagonda of N.
Am., Inc., No. 97 C 7792, 1999 U.S. Dist. LEXIS 14765 at *26-31 (N.D. Ill. Sept. 10, 1999). In
Abraham, the Second Circuit held that a plaintiff could not bring implied warranty claims under
the Magnuson-Moss Act if state law privity requirements barred the claim under state law. See
Abraham, 795 F.2d at 247-48. This Court is persuaded by the reasoning in Abraham and those
cases following it. Because Illinois law requires privity in implied warranty economic loss
cases, privity is required for such cases under the Magnuson-Moss Act.

Although the Illinois Supreme Court in Szajna and Rothe determined that the Magnuson-
Moss Act allows buyers to make implied warranty claims against manufacturers where
manufacturers have provided buyers with written warranties,' the Court is not persuaded by their
interpretation of federal law. See Soldinger, 1999 U.S. Dist. LEXIS 14765 at *26-31.
Moreover, the Illinois Supreme Court’s interpretation of federal law is not binding on this Court.
RAR, Inc. v. Turner Diesel, 107 F.3d 1272, 1275-76 (7th Cir. 1997).

In this case, Schimmer and Jaguar are not in privity with each other because Schimmer

did not purchase the XK8 from Jaguar. Accordingly, Count I is dismissed.’

' See Rothe, 119 Ill.2d at 294; Szajna, 115 Ill.2d at 315-16.

? Jaguar also contends that Schimmer has not sufficiently pleaded Count II for failing to allege
that the XK8 was defective at the time of delivery. (R. 12-1, Def. Mem. at 4.) Having dismissed
Count II for lack of privity, the court need not address this argument.

5



replace warranties only guarantee that the vehicle will be repaired, replaced, or that defects will
be adjusted. Cosman, 285 Ill.App.3d at 257; Voelker, 2003 U.S. Dist. LEXIS 1898 at *6-7.

In the instant case, Jaguar has only provided Schimmer with a repair and replace
warranty. (R. 1-1, Compl. 26.) That type of warranty does not fall within the Illinois UCC’s
definition of warranty. Consequently, the Court grants Jaguar’s motion to dismiss Count IV of
the complaint.

CONCLUSION
For the reasons stated herein, Jaguar’s 12(b)(6) motion to dismiss is granted with respect

to Counts II and IV and denied with respect to Count II.

DATED: July 1, 2003 ENTERED

Gent

AMY J. Si
United St Datiet Court Judge



Gkinute Order Fort’ (06/97)

United States District Court, Northern District of Illinois

Ni f Assigned Jud; Sitting Judge if Other
roe Magistrate Judge Amy J. St. Eve than Assigned Judge
CASE NUMBER 03 C 1884 DATE 7/1/2003
CASE Schimmer vs. Jaguar Cars
TITLE

{In the following box (a) indicate the party filing the motion, e.g,, plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
of the motion being presented.}

MOTION:

DOCKET ENTRY:

(1) im Filed motion of [ use listing in “Motion” box above.]

(2) ao Brief in support of motion due

(3) oO Answer brief to motion due___. Reply to answer brief due

(4) oO Ruling/Hearing on setfor at.

(5) im Status hearing[held/continued to] [set for/re-set for]on__setfor__—_at.

(6) Qa Pretrial conference[held/continued to] [set for/re-set for]on__——ssetfor_———saat__.
(7) a Trial[set for/re-set for] on___—__att

(8) Qa (Bench/Jury trial] [Hearing] held/continued to__at

(9) qa This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

CUFRCP4(m) CLocal Rule 41.1 CFRCP41(a\(1) O FRCP41(a\(2).

(0) Ml — [Otherdocketentry} Enter Memorandum Opinion and Order. Jaguar’s 12(b)(6) motion to dismiss
is granted in part and denied in part. It is granted with respect to Counts II and IV and denied with respect

(any?

(11) [For further detail see order attached to the original minute order.]

No notices required, advised in open court.

No notices required.
umber of notices

Notices mailed by judge’s staff.

Notified counsel by telephone.

2 aZ003

dockered

av | Docketing to mail notices.

docketing deputy iitias

a form 4yno. “es
Mail AO 450 f 9 191siq sn

Copy to judge/magistrate judge.

OOS Wy porn
eourzoom OS Hd t-nr ey
THY deputy’s
initials

wpe,
*~Dateltitnereskived in
central Clerk's Office

rmailing deputy initials



HI. The Magnuson-Moss Act Provides For Revocation

Section 2310(d)(1) of the Magnuson-Moss Act provides that a buyer who has been
damaged by a “supplier, warrantor, or service contractor . .. may bring suit for damages and
other legal and equitable relief.” 15 U.S.C. § 2310(d) (emphasis added). Revocation is one form
of relief available under Magnuson-Moss Act to a plaintiff should he succeed at trial. Jones v.
Fleetwood Motor Homes, No. 98 C 3061, 1999 WL 999784 at *2 (N.D. Ill. Oct. 29, 1999);
Soldinger, 1999 U.S. Dist. LEXIS 14765 at *31-35.

Jaguar contends that because Section 5/2-608 of the Illinois UCC provides that
revocation “is not effective until the buyer notifies the seller of it,” revocation is only available
against the seller of a good. (R. 12-1, Def. Mem. at 4.) Schimmer, however, does not seek
revocation pursuant to Illinois law. Instead, Schimmer requests revocation under the Magnuson-
Moss Act, which explicitly provides a broad range of remedies enforceable against a warrantor.
It is clear that the Magnuson-Moss Act provides for revocation of acceptance as a remedy
against a warrantor-manufacturer. See Jones, 1999 WL 999784 at *2; Soldinger, 1999 U.S. Dist.
LEXIS 14765 at *31-35. Having provided Schimmer with an express limited warranty, the
Court denies Jaguar’s motion to dismiss Count III because the Magnuson-Moss Act permits the
relief Schimmer seeks.

Further, even if Section 5/2-608 of the Illinois UCC controls whether Schimmer may
seek revocation against Jaguar, Illinois law permits Schimmer to do so. See Lytle v. Roto
Lincoln Mercury & Subaru Inc., 167 Ill.App.3d 508, 519 (2nd Dist. 1988). Schimmer is only
required to allege that the defects have substantially impaired the XK8’s value to him, that he
could not have discovered the defects prior to his acceptance of the vehicle, that he notified
Jaguar of his revocation of acceptance, and that Jaguar has refused to provide him with the

6



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

DONALD SCHIMMER, ) Sb
Plaintiff, ‘ JUL 2 - m3
v. } No. 03 C 1884

JAGUAR CARS, INC., ,

Defendant. }

MEMORANDUM OPINION AND ORDER JU 2 2003
AMY J. ST. EVE, Judge:

After a series of failed repair attempts on his 2000 XK8 Jaguar (“XK8”), Donald
Schimmer (“Schimmer”) filed a four-count complaint against Jaguar Cars, Inc. (“Jaguar”), the
manufacturer of Schimmer’s XK8. Schimmer’s complaint charges Jaguar with breaching
express and implied warranties under state and federal law, and requests Jaguar’s revocation of
acceptance of the sales contract for the XK8. Jaguar moves to dismiss counts I-IV of the
complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for Schimmer’s failure to state a
claim upon which relief can be granted. For the reasons stated herein, Jaguar’s motion is granted
in part and denied in part.

LEGAL STANDARD

A Rule 12(b)(6) motion to dismiss tests the legal sufficiency of a complaint, not the
merits of aclaim. Triad Assoc., Inc. v. Chicago Hous. Auth., 892 F.2d 583, 586 (7th Cir. 1989);
Soldinger Assoc., Ltd. v. Aston Martin Lagonda of N. Am., Inc., No. 97 C 7792, 1988 U.S. Dist.
LEXIS 3988 at *4 (ND. Ill. March 27, 1998). In evaluating a 12(b)(6) motion, a court examines

the facts alleged in the complaint and draws all reasonable inferences from those facts in the

\\



plaintiff's favor. Stachon v. United Consumers Club, Inc., 229 F.3d 673, 675 (7th Cir. 2000).
Dismissal is appropriate only when “it is clear that no relief could be granted under any set of
facts that could be proved consistent with the allegations.” Hishon v. King & Spaulding, 467
US. 69, 73 (1984); Henderson v. Sheahan, 196 F.3d 839, 846 (7th Cir. 1999).

A complaint need not set out in detail the facts upon which a plaintiff bases his claim.
Benson v, Cady, 761 F.2d 335, 338 (7th Cir. 1985). A complaint, however, must “include either
direct or inferential allegations with respect to all material elements of the claims asserted.”
Indus. Hard Chrome, Ltd. v. Hetran, Inc. 64 F.Supp.2d 741, 744 (N.D. Ill. 1999) (citing Perkins
v. Silverstein, 939 F.2d 463, 466 (7th Cir. 1991)). Attaching bare legal conclusions to narrated
facts fails to satisfy federal pleading requirements, Strauss v. City of Chicago, 760 F.2d 765,
768 (7th Cir. 1985).

ALLEGATIONS
L Schimmer Purchased an Allegedly Defective XK8

On January 15, 2000, Schimmer purchased a 2000 Jaguar XK8 from Town & Countree
Auto Sale, Inc., an authorized Jaguar dealership, for $69, 513.00. (R. 1-1, Compl. {] 2-4.)
Schimmer’s purchase included a limited manufacturer’s warranty for three years or 36,000 miles
stating that Jaguar would “refund, repair, replace or take other remedial action free of charge to
Plaintiff with respect to the XK8” should the XK8 fail to meet warranty specifications. (Jd. at
5, 26.) Shortly after taking possession of the XK8, Schimmer alleges that he experienced a
series of defects and nonconformities in violation of Jaguar’s express warranties to Schimmer.
(id. at §§ 7-8.) These defects and nonconformities included the following: a defective

suspension as evidenced by clunking noise while in reverse; water leaks; a defective