IN THE UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA MIAMI DIVISION REPLY IN SUPPORT OF DEFENDANT GENERAL MOTORS LLC S MOTION TO DISMISS

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1 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 1 of 10 IN THE UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA MIAMI DIVISION JONI PRECHT, on behalf of herself and all others similarly situated, v. Plaintiff, GENERAL MOTORS LLC, Defendant. CASE NO. 1:14-CV (PCH) REPLY IN SUPPORT OF DEFENDANT GENERAL MOTORS LLC S MOTION TO DISMISS Defendant General Motors LLC ( GM ) files its Reply in Support of its Motion to Dismiss ( GM s Motion ), and states: I. INTRODUCTION Plaintiff s Opposition to the Motion to Dismiss (the Opposition ) contains numerous erroneous assertions of facts that GM contests. For example, Plaintiff suggests that her Complaint filed on March 14, which she made no effort to serve--may have been the impetus for the recall that was announced 3 days later. 1 But recognizing the stage of the proceeding, and because Plaintiff s factual assertions bear no relationship to the legal arguments raised in GM s Motion, this reply will focus on the few legal arguments raised in the Opposition. With respect to these legal issues, GM initially notes that Plaintiff makes no argument in the Opposition that (1) her claims for breach of implied warranties and 1 GM also notes that the March 14, 2014 Complaint named as a defendant General Motors Corporation, a bankrupt entity, not General Motors LLC. 1

2 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 2 of 10 negligent misrepresentation should not be dismissed and (2) that her claim under the Magnuson-Moss Federal Warranty Act is not completely dependent on the viability of her state law warranty claims. Plaintiff has therefore conceded that GM s arguments on these points are correct, and has abandoned the claims. 2 In any case, the authorities cited by GM in the Motion establish that these claims are barred not only because they are moot, but also because the claims fail legally or were inadequately pled. With respect to Plaintiff s other claims, she argues only that (1) the recall, which will fix the alleged problem in her vehicle, does not moot her claims because she seeks punitive damages and diminished value damages, and those damages are not addressed by the recall; (2) she has pled a plausible breach of the limited repair warranty, even though the alleged problem admittedly arose more than three years and 36,000 miles after she purchased her vehicle, because the durational limitation on GM s warranty is unconscionable; and (3) she has pled plausible claims for negligence because the economic loss rule should not apply. All of these arguments are unavailing. Under Florida law a plaintiff cannot recover both diminution in value and cost of repair since it would provide an impermissible double recovery. With respect to punitive damages, Plaintiff never attempts to identify what cause of action would support a claim for punitive damages. In fact, the FDUTPA provides only for the recovery of actual damages, not punitive damages. Plaintiff s claim for breach of the repair warranty likewise does not support a 2 See, e.g., Bute v. Schuller Int l, Inc., 998 F. Supp. 1473, 1477 (N.D. Ga. 1998) ( Because plaintiff has failed to respond to this argument or otherwise address this claim, the court deems it abandoned ). See also, Coalition for the Abolition of Marijuana Prohibition v. City of Atlanta, 219 F.3d 1301, 1326 (11 th Cir. 2000) (the failure to brief and argue an issue in the district court is grounds for finding that the issue has been abandoned ). 2

3 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 3 of 10 claim for punitive damages. With respect to the negligence claims, Plaintiff relies on an Eleventh Circuit case interpreting Georgia law, and disregards an unbroken line of Florida precedents holding that a negligence claim is barred when the only alleged harm is to the product itself. Accordingly, GM s Motion to Dismiss should be granted in its entirety. II. ARGUMENT A. Plaintiff s Negligence Claims are Barred by the Economic Loss Rule. Plaintiff simply ignores the numerous cases applying Florida law which hold a negligence claim is barred when there is no personal injury or property damage beyond damage to the product itself. See Motion to Dismiss at 7-8. Instead, Plaintiff mischaracterizes the Florida Supreme Court s holding in Tiara Condo. Assoc., Inc. v. Marsh & McLennan Cos., 110 So.3d 399 (Fla ) and the Eleventh Circuit s holding in Squish La Fish v. Thomco Speciality Products, Inc., 149 F.3d 1288 (11 th Cir. 1998). With respect to Tiara, Plaintiff suggests the case holds that the economic loss rule is ill-defined and has been improperly extended. Opposition, p. 10. However, Tiara recognized two branches of the economic loss rule in Florida: (1) the contractual privity application of the economic loss rule and (2) the products liability application of the economic loss rule. Tiara, 110 So.3d at To the extent the Florida Supreme Court was concerned with the unprincipled extension of the rule, it made clear the reference was to the contractual privity arm, not the product liability arm. Id. at 406. In fact, the Florida Supreme Court expressly reaffirmed that the economic loss rule was applicable in the product liability area, stating: 3

4 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 4 of 10 Having reviewed the origin and original purpose of the economic loss rule and what has been described as the unprincipled extension of the rule, we now take this final step and hold that the economic loss rule applies only in the products liability context. We thus recede from our prior rulings to the extent that they have applied the economic loss rule to cases other than products liability. Id. at 407. In short, contrary to the suggestion of Plaintiff, Tiara confirms that the economic loss rule bars the negligence claims asserted since there is no allegation of personal injury or damage to other property. See also Aprigliano v. Amer. Honda Motor Co., Inc., 979 F. Supp. 2d 1331, (S.D. Fla. 2013) (recognizing Tiara reaffirmed that Florida applies the economic loss rule in product liability actions). 3 With respect to the Eleventh Circuit s opinion in Squish, Plaintiff fails to note that the case was decided under Georgia law, not Florida law. Squish La Fish, 149 F.3d at That Georgia and Florida law differ, in particular with respect to alleged exceptions to the economic loss rule, is made clear in Pycsa Panama, S.A. v. Tensar Earth Tech., Inc., 625 F. Supp. 2d 1198 (S.D. Fla. 2008), aff d, 329 Fed. Appx. 257 (11 th Cir. 2009). In Pycsa, in connection with a choice of law analysis, the Court noted differences between the two states application of the economic loss rule, including that Georgia, unlike Florida, recognizes the accident exception, which Plaintiff relies on 3 It is also important to note that Aprigliano found that the economic loss rule bars a negligent misrepresentation claim where there are claims for breach of warranty alongside tort claims and the allegations contained in both are similar. Aprigliano at This reasoning supports dismissal of Plaintiff s negligent misrepresentation claim pursuant to the economic loss rule, even if the claim had been adequately pled. 4

5 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 5 of 10 here. 4 Id. at The decision in Squish simply has no relevance in determining the parameters of the Florida economic loss rule. Since Plaintiff has provided no relevant Florida authority which supports the argument that her negligence claims are not barred by the economic loss rule, GM s motion to dismiss those claims should be granted. B. Plaintiff s Claim for Breach of the Limited Warranty Fails. Plaintiff does not dispute that her vehicle experienced the problem about which she complains after the expiration of the 3-year, 36,000 mile limited warranty, and therefore her claim falls outside the warranty period. See Brisson v. Ford Motor Co., 349 Fed. Appx. 433, 434 (11 th Cir. 2009) (per curiam) (a claim for breach of an express warranty is not viable where the defect has not manifested itself during the warranty period). Plaintiff nevertheless argues that the limited warranty freely given by GM is somehow unconscionable. But Plaintiff does not explain how a limited repair warranty-- one that is not required by the U.C.C. and does not limit her rights under the U.C.C.-- could ever be unconscionable. See Motion, pp Nor does Plaintiff cite any Florida authority holding that the durational aspect of a 3-year, 36,000 mile warranty could ever be unconscionable. Instead, she chooses to rely on cases from other jurisdictions, and in doing so, simply ignores a case from this district that specifically rejected the argument. See Licul v. Volkswagen Group of Amer., Inc., No. 13-cv-61686, 2013 WL , *2-4 (S.D. Fla. December 5, 2013) (Rec. Doc. 18). Finally, even assuming that an 4 Although Plaintiff relies on the Georgia law-based accident exception to avoid the economic loss rule, there was no accident here, so the exception wouldn t apply even if Georgia law were relevant. See Pycsa, 625 F. Supp. 2d at 1244 (noting that the gradual deterioration of a product is not an accident for purposes of the [economic loss] rule. ). 5

6 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 6 of 10 unconscionability analysis could be applied to a freely given repair warranty, Plaintiff has not pled any facts suggesting that the durational limitation of the repair warranty is either substantively or procedurally unconscionable. Id. at *3 (stating that under Florida law a contract or clause is unconscionable when it is both procedurally and substantively unconscionable ). For all the foregoing reasons, Plaintiff has failed to state a claim for breach of the limited repair warranty. C. All Plaintiff s Claims are Moot. Plaintiff argues that because she seeks punitive damages and diminution in value damages, the repair of her vehicle does not provide all of the relief she could obtain in this lawsuit. However, she cites no authority supporting the recovery of (1) diminution in value damages in cases where a vehicle repair is available, or (2) punitive damages given the nature of the claims asserted here. This is not surprising, since Florida law is to the contrary. With respect to diminution damages, providing both a repair remedy and a diminution in value remedy would result in an impermissible double recovery. See, e.g., Badillo v. Hill, 570 So.2d 1067 (Fla. 5 th DCA 1990). In Badillo, the court specifically found that a plaintiff cannot obtain a combination of cost of repairs plus lessened value before repairs, because that would permit a double recovery. Id. at 1068 citing Merrill Stephens Dry Dock Co. v. Nicholas, 470 So.2d 32 (Fla. 3d DCA 1985). Further, even assuming Plaintiff could state a valid warranty claim, the only available remedy under the limited written warranty is repair. In this regard, the limited warranty specifically provides that performance of repairs and needed adjustments is the exclusive remedy 6

7 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 7 of 10 under this written warranty and that GM shall not be liable for incidental or consequential damages... resulting from breach of this written warranty. See Motion to Dismiss, Ex. A, Doc. ID With respect to punitive damages, Plaintiff does not identify what pled claim would support such an award. Nor could she, since none of the potentially viable claims she asserts would support an award of punitive damages. A breach of warranty claim does not support an award of punitive damages under Florida law. See Mobile Chemical Co. v. Hawkins, 440 So.2d 378, 381 (Fla. 1 st DCA 1983) ( Although the proof produced at trial suggests that Mobile may have breached its warranty of the effectiveness of MOCAP, no independent tort has been committed and punitive damages may not be awarded. ); see also John Brown Automation, Inc. v. Nobles, 537 So.2d 614, 617 (Fla. 2 nd DCA 1989) ( Punitive damages for breach of contract are barred by Florida law ). Further, the FDUTPA only provides for recovery of actual damages, not punitive damages. See, e.g., Jovine v. Abbott Lab, Inc., 795 F. Supp. 2d 1331, 1344 (S.D. Fla. 2011) (holding FUDTPA only allows for actual damages, and voluntary recall of product negated any damages). Finally, as noted above, Plaintiff s negligence claims fail as a matter of law, and she has not even argued that her negligent misrepresentation and implied warranty claims should not be dismissed. Accordingly, not only has Plaintiff failed to plead facts that would support an award of punitive damages, she has not in any case asserted a viable claim that would support an award of punitive damages. Since Plaintiff is not entitled to more than repair of her vehicle, a remedy available through the recall overseen by NHTSA, her claims are moot. See Motion, pp

8 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 8 of 10 III. CONCLUSION For all the foregoing reasons, and the reasons set forth in the Motion to Dismiss, GM requests that all Plaintiff s claims be dismissed. Dated: September 15, 2014 /s/laurie M. Riley Laurie M. Riley (Florida Bar No.: ) lriley@joneswalker.com Jones Walker LLP 201 South Biscayne Boulevard, Suite 2600 Miami, Florida Telephone: (305) Facsimile: (305) A. Erin Dwyer (Texas Bar No.: ) Admitted Pro Hac Vice Erin.dwyer@figdav.com Timothy A. Daniels (Texas Bar No.: ) Admitted Pro Hac Vice Tim.daniels@figdav.com Figari & Davenport, L.L.P. 901 Main Street, Suite 3400 Dallas, Texas Telephone: (214) Facsimile: (214) ATTORNEYS FOR DEFENDANT 8

9 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 9 of 10 IN THE UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA MIAMI DIVISION JONI PRECHT, on behalf of herself and all others similarly situated, v. Plaintiff, GENERAL MOTORS LLC, Defendant. CASE NO. 1:14-CV (PCH) Reply in Support of Defendant General Motor LLC s Motion to Dismiss CERTIFICATE OF SERVICE I HEREBY CERTIFY that on September 15, 2014, I electronically filed the foregoing document with the Clerk of the Court using CM/ECF. I also certify that the foregoing document is being served this day on all counsel of record or pro se parties identified on the attached Service List in the manner specified, either via transmission of Notices of Electronic Filing generate by CM/ECF or in some other authorized manner for those counsel or parties who are not authorized to receive electronically Notices of Filing. /s/ Laurie M. Riley Laurie M. Riley SERVICE LIST Jon M. Herskowitz Baron & Herskowitz, LLP 9100 South Dadeland Blvd. One Datran Center, Suite 1704 Miami, Florida jon@bhfloridalaw.com Served via transmission of Notices of Electronic Filing generated by CM/ECF 9

10 Case 1:14-cv PAS Document 24 Entered on FLSD Docket 09/15/2014 Page 10 of 10 Charles J. LaDuca William H. Anderson Cuneo Gilbert & LaDuca, LLP 507 C Street, NE Washington, DC charlesl@cuneolaw.com wanderson@cuneolaw.com Served via transmission of Notices of Electronic Filing generated by CM/ECF 10

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