Source: http://va.findacase.com/research/wfrmDocViewer.aspx/xq/fac.20170123_0000076.WVA.htm/qx
Timestamp: 2017-03-26 07:16:10
Document Index: 470008050

Matched Legal Cases: ['§ 59', '§ 59', '§ 18', '§ 32908', '§ 600', '§ 600']

| Gentry v. Hyundai Motor America, Inc.
Gentry v. Hyundai Motor America, Inc.
JOHN WILLIAM GENTRY, ET AL., Plaintiffs,v.HYUNDAI MOTOR AMERICA, INC., Defendant. ALIM ABDURAHMAN, ET AL., Plaintiffs,v.HYUNDAI MOTOR AMERICA, INC., ET AL., Defendants. JIHAD ABDUL-MUMIT, ET AL., Plaintiffs,v.HYUNDAI MOTOR AMERICA, INC., ET AL., Defendants.
K. MOON, UNITED STATES DISTRICT JUDGE
three cases are before the Court on motions to dismiss. Each
involves allegations that Hyundai Motor America, Inc.
(“HMA”) misstated or misrepresented the gas
mileage obtained by Hyundai Elantras. Gentry is a
class action against a single defendant, HMA.
Abdurahman is a mass action of over 700 plaintiffs
against 29 defendants: HMA and various Virginia dealerships.
Abdul-Mumit-also a mass action with substantively
identical allegations to Abdurahman-has over 500
named plaintiffs suing 27 defendants. The cases previously
were stayed, transferred to MDL 2424, and then partially
remanded by the MDL back to this Court in September 2015.
Each case contains a claim under the Virginia Motor Vehicle
Warranty Enforcement Act (“Lemon Law”), Va. Code
§§ 59.1-207.9 et seq.; the Virginia
Consumer Protection Act of 1977 (“VCPA”), Va.
Code §§ 59.1-196 et seq.; and for false or
misleading advertising, Va. Code §§ 18.2-216 &
59.1-68.3.
important date in these cases is November 2, 2012, when HMA
announced its “recalculation” of fuel economy
estimates for certain vehicles (“Announcement”).
At the MDL, a class settlement was reached for pre-November
2nd purchasers and is now on appeal before the Ninth Circuit.
Thus, the MDL remanded these cases for proceedings on two
sets of claims: (1) any pre-November 2nd purchasers who opted
out of the settlement, and; (2) post-November 2nd purchasers
of 2011-13 Hyundai Elantras sold in Virginia.
(Gentry, dkt. 91).
parties have presented numerous jurisdictional and merits
arguments. After briefing and oral argument, the Court
concludes that aspects of the Lemon Law claim in
Gentry based on the on-board mileage calculator may
proceed. But the aspect of the Lemon Law claim based on fuel
economy, as well as Mr. Gentry's VCPA and false
advertising claims, will be dismissed because those counts do
not state a claim. As for Abdul-Mumit and
Abdurahman, the Court finds that it has jurisdiction
based on the Class Action Fairness Act (“CAFA”).
In addition to sharing some shortcomings with the
Gentry complaint, the complaints in
Abdul-Mumit and Abdurahman are devoid of
facts pertaining to any of the hundreds of named plaintiffs
or to any Defendant other than HMA. Therefore, those
complaints will be dismissed.
Gentry Filed and Stayed.
was filed in this Court in August 2013. The complaint was
amended that October, but Defendant HMA moved both to dismiss
the complaint and to stay the case. The case was stayed in
November 2013 pending a decision from the MDL.
Abdurahman Filed and Removed, so
Abdul-Mumit Is Filed (and Removed).
Gentry was stayed, the Plaintiffs' attorney, Mr. Feinman,
filed a mass action, Abdurahman, in state court in
December 2013. Defendants removed the case to this Court on
January 2014, citing the Class Action Fairness Act
(“CAFA”) as the basis for removal.
next day, Mr. Feinman filed Abdul-Mumit in the
Roanoke Circuit Court, a complaint which was substantively
identical to Abdurahman, except that the caption of
named plaintiffs and defendants differed somewhat.
Predictably, Defendants removed Abdul-Mumit in
February 2014, although this time-in addition to CAFA
jurisdiction-they also relied on traditional diversity
jurisdiction (arguing that that defendant dealerships in
Virginia were fraudulently joined or were nominal defendants)
and federal question jurisdiction (arguing that the attempt
to evade the Court's stay in Gentry implicated
the Court's authority to control its own proceedings).
MDL Transfers, then Remands, the Cases
motions to dismiss pending in all three cases, the MDL on
June 9, 2014 ordered the transfer of all three cases to the
extensive proceedings, the MDL returned the cases on
September 15, 2015 to this Court, identifying the two classes
noted above: pre-November 2nd opt-outs and post-November 2nd
purchasers. From late 2015 to mid-2016, the parties-at the
Court's repeated urging- attempted with only modest
success to resolve various case management issues:
e.g., deadlines; identification of proper plaintiffs
and possible duplication of cases; and whether discovery,
repleading, or both should occur.
and July 2016, the Court ordered Plaintiffs to amend their
complaints to reflect developments in the case, or else have
their prior complaints deemed operative. (See
Gentry, dkts. 86, 89). They chose the latter, and
Defendants filed renewed motions to dismiss in all three
was filed as a class action with five named plaintiffs.
Defendant HMA asserts- and Plaintiff does not contest-that
the four other named class representatives were not remanded
by the MDL because those plaintiffs fell within the
settlement and did not opt out. Thus, Mr. Gentry is the only
remaining named plaintiff in Gentry.
Complaint brings claims for violations of Virginia's
“Lemon Law, ” the VCPA, and deceptive advertising
law. (Dkt. 27 [hereinafter “Complaint”] ¶
4). The case involves allegedly deceptive practices
surrounding HMA's 2011-2013 Elantra vehicle.
November 2010, HMA's CEO introduced the “All New 40
MPG Hyundai Elantra.” (Complaint ¶ 5). Ad
campaigns represented that the Elantra would obtain 40 miles
per gallon (“MPG”) on the highway.
(Id.). Allegedly, 16, 000 Virginians bought the
2011-2013 edition. (Id.). Mr. Gentry was one of
them. He commutes several miles to work, and in early 2013
began researching a new vehicle. (Id. ¶ 7). He
recalled ads for the 2011-2012 Elantra touting its 40 MPG
highway and later saw others about the 2013 Elantra claiming
38 MPG. (Id.). He thus purchased a 2013 Elantra on
February 18, 2013 from a dealer in Staunton, Virginia.
(Id. ¶ 8). He asserts that his “warranty
book” stated his car would receive “up to”
40 MPG. (Id. ¶ 7).
Post-purchase,
Mr. Gentry kept track of his car's MPG. Rather than
obtaining 38 MPG, his Elantra received only 30 to 33 MPG.
(Complaint ¶ 9). Plaintiff returned to the local HMA
dealership, where employees relayed that his car should get
38 MPG on the highway. (Id. ¶¶ 9- 10).
Indeed, the dealership's owner drove the vehicle himself
and calculated that Gentry's car was receiving 32 MPG,
and that the on-board mileage calculator was overstating the
actual gas mileage. (Id. ¶ 10). Further testing
by the dealership employees and HMA representatives occurred.
18, 2013, HMA employees performed tests in Staunton,
Virginia. (Complaint ¶ 11). Their tests yielded 62 MPG
and 42 MPG calculations, while the on-board mileage
calculator yielded 37-40 MPG and 38-44 MPG, respectively.
(Id.). In subsequent conversations with Mr. Gentry,
the dealership's owner expressed doubt about the accuracy
of these calculations, which contradicted his experiences, as
well as Mr. Gentry's, when driving the car. (Id.
¶ 12). The dealership owner claimed the HMA employees
insisted that: the Elantra obtained the proper gas mileage;
Mr. Gentry's calculations were caused by his driving
style; and the car received the proper gas mileage.
a nonresponsive HMA, Gentry sought legal representation.
During his search, he discovered “for the first
time” details of a separate class action where HMA
admitted in November 2012 that it has submitted false and
incorrect mileage calculations to the EPA for its 2011-2013
Elantras. (Complaint ¶ 13). Plaintiff alleges additional
facts regarding two of his claims.
alleges that HMA published on its website in April 2012
statements that 39% of Elantras obtain 40 MPG. (Complaint
¶ 21). HMA cannot fix its 2011- 2013 Elantras to make
them produce 40 MPG. (Id. ¶ 24). Further, HMA
represented that Elantra's on-board mileage calculators
would give “accurate” MPG assessments but in fact
do not. (Id. ¶ 25). Mr. Gentry alleges
“on information and belief” that HMA knew its MPG
tests for the Elantra model, as well as its on-board mileage
calculator, were inaccurate. (Id.).
VCPA.
asserts several statements or actions by HMA constituted
violations of the VCPA: (A) HMA's statement that Elantras
would receive 40 MPG; (B) HMA's refusal to sell an
Elantra to Mr. Gentry that conformed to the 40 MPG
representation; (C) HMA's representation that the
on-board calculator was accurate; (D) statements from a HMA
website that 2013 Elantras could obtain 38 MPG had
deceptively obscure and difficult-to-read disclaimers; (E)
HMA employees' statements about the gas mileage Mr.
Gentry's Elantra actually received when they tested it.
(See Complaint ¶ 31).
GENTRY-ANALYSIS
Additional Facts Presented by HMA.
submitted several exhibits to its motion to dismiss. HMA uses
the first class of exhibits to advance its legal arguments
about preemption. The second batch of documents is used in
support of HMA's argument that the EPA has primary
jurisdiction over this case. Even if the Court were to
consider these documents, the arguments they support do not
succeed or fail by reference to the exhibits.
Exhibits A through E, HMA urges judicial notice of statements
made by the government on its websites. See Johnson v.
Clarke, No. 7:12CV00410, 2012 WL 4503195, at *2 n.1
(W.D. Va. Sept. 28, 2012) (compiling cases). These exhibits
contain statements made on the EPA's website about fuel
economy, HMA's Elantra, and the relevant regulatory
regime. HMA observes that federal law mandates fuel economy
labels and authorizes the EPA to issue effecting regulations.
See 48 U.S.C. § 32908(b); 40 C.F.R.
§§ 600.302-12(a)-(f), (h). One regulation mandates
that these labels state: “actual results will vary for
many reasons.” 40 C.F.R. § 600.302-12(b)(4).
According to the EPA, the purpose of the fuel estimates is to
“help consumers compare the fuel economy of different
vehicles when shopping for new cars.” (Dkt. 91-3 at ECF
November 2, 2012-before Gentry purchased his car-EPA and HMA
announced that, as a result of a federal investigation, HMA
would lower fuel estimates on most 2012 and 2013 models by an
average of 1-2 MPG; the change for Elantras was 2 MPG. (Dkt.
91-5 at ECF 2; dkt. 91-6 at ECF 2). The Announcement advised
that HMA would be submitting a plan to relabel all cars on
dealership lots with corrected mileage estimates. (Ex. D).
this, HMA states that Gentry saw a corrected label
before he purchased his vehicle. And from that
purported fact, HMA asserts that the Court may take judicial
notice of a reproduced sticker in its brief because it is
integral to the complaint. Based on the existence of the
sticker-so HMA's argument goes-Gentry's claims fail
because he had notice of the accurate MPG estimate for his
this line of argument assumes that HMA actually re-labeled
the car Mr. Gentry bought before he bought it. Indeed, HMA
admits the sticker is a “replica” of what Mr.
Gentry “would have seen at the time of purchase.”
(Dkt. 91-1 at 7). At the motion to dismiss stage, the Court
cannot use the additional facts HMA has submitted to make
further factual inferences that (1) HMA properly relabeled
the car Gentry bought, and (2) Gentry saw the corrected
mileage sticker before purchasing his vehicle. See Zak v.
Chelsea Therapeutics Int'l, Ltd., 780 F.3d 597, 607
(4th Cir. 2015).
also relies upon a consent decree between it, other parties,
and the EPA entered on January 9, 2015 in a Washington, D.C.
court. (Ex. I, J). Specifically, HMA must submit a
“Corrective Measures Completion Report” by April
2018 and annual reports for monitoring by the EPA. (Ex. J.,
¶ 19; Id. App'x A, ¶ 10). The import
of these documents is discussed, infra, where the
Court finds that the primary jurisdiction doctrine does not
apply, and thus the EPA's consent decree is no impediment
to deciding these cases.
bring a federal case, a “plaintiff must have (1)
suffered an injury in fact, (2) that is fairly traceable to
likely to be redressed by a favorable judicial
decision.” Spokeo, Inc. v. Robins, 136 S.Ct.
1540, 1547, 194 L.Ed.2d 635 (2016). HMA argues that Gentry
lacks standing because he did not suffer injury in fact and,
even if he did, such injury was not fairly traceable to HMA.
The Court concludes that Mr. Gentry has standing.
the injury-in-fact inquiry, an alleged injury must affect the
plaintiff in a personal and individual way. Lujan v.
Defs. of Wildlife, 504 U.S. 555, 561 n.1 (1992). HMA
argues that Mr. Gentry cannot base his claims on
pre-Announcement fuel estimates because those estimates were
not in effect when he purchased his car in February 2013. It
says that representations about models he did not purchase
are irrelevant, and Mr. Gentry never claims to have seen
(before his purchase) the advertisements he cites about the
2013 Elantra. (Dkt. 91-1 at 11). But the Announcement does
not affect Gentry's claim, which is that he bought a 2013
Elantra falsely represented to achieve 38 MPG highway
mileage. (Complaint ¶ 7). The fact that HMA or the EPA
made a generic announcement about an incorrect 40 MPG
estimate for some vehicles does not negate Plaintiff's
assertion that his vehicle still did not achieve the
corrected mileage. HMA's arguments simply go to the
merits of whether Mr. Gentry states a plausible claim for
relief. See infra Part III.
the “causal connection” prong, HMA claims that
the November 2, 2012 Announcement and the window (or
“Monroney”) sticker sever any connection between
the injury he suffered and the conduct complained of. But
HMA's claim about the sticker fails, as it implies the
Court may assume (against Gentry) the corrected sticker was
placed on Gentry's vehicle and seen by him. At the
motion-to-dismiss stage, the Court must make factual
inferences from the complaint (or judicially-noticed
materials) in favor of Gentry, not against him. See
Zak, 780 F.3d at 607 (“when a court considers
relevant facts from the public record at the pleading stage,
the court must construe such facts in the light most
favorable to the plaintiffs”). Without this inferential
crutch, HMA's argument fails and Mr. Gentry has standing.
Preemption and Other Difficulties
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HMA
next claims that Gentry&#39;s state law claims are preempted
by Section 32919(b), which states that when a requirement
under &sect; 32908 is in effect, &ldquo;a State may adopt or
enforce a law or regulation on disclosure of fuel economy . .
. only if the law or regulation is identical to that
requirement.&rdquo; Section 32908(b) and the EPA&#39;s
effectuating regulations specifically describe the content of
the window-sticker fuel economy estimates. Moreover, the
Federal Trade Commission has declared that car advertisements
must include the relevant EPA mileage estimates. See
16 C.F.R. 259.2; see also Guide Concerning Fuel Economy
Advertising of New Automobiles, 60 Fed. Reg. 56230-01,
1995 WL 652912 (Nov. 8, 1995). Courts have thus found that-to
the extent a plaintiff&#39;s claims are based on ads or
window-stickers using EPA estimates and not defendants&#39;
statements about &ldquo;actual&rdquo; fuel economy
calculations-such claims are preempted. See In re Ford
Fusion & C-Max Fuel Econ. Litig., ...