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Julia Wood v. Maguire Auto. LLC

September 26, 2011

JULIA WOOD, PLAINTIFF,
v.
MAGUIRE AUTO. LLC, AS SUCCESSOR TO BILL COOKE IMPORTS, INC., A/K/A BILL COOKE IMPORTS, INC.; AND VOLVO CARS OF N. AM., LLC; VOLVO CARS OF N. AM., LLC; CROSS-CLAIMANT,
v.
MAGUIRE AUTO. LLC, AS SUCCESSOR TO BILL COOKE IMPORTS, INC., A/K/A BILL COOKE IMPORTS, INC., CROSS-DEFENDANT



The opinion of the court was delivered by: Hon. Glenn T. Suddaby, United States District Judge

MEMORANDUM-DECISION and ORDER

Currently before the Court, in this breach-of-warranty and fraud action filed by Julia Wood ("Plaintiff") against Maguire Automotive LLC and Volvo Cars of North America, LLC ("Defendants"), are Defendants' motions to dismiss for lack of subject-matter jurisdiction. (Dkt. Nos. 28, 30.) For the reasons set forth below, Defendants' motions are granted.

I. RELEVANT BACKGROUND

A. Plaintiff's Claims

Generally, liberally construed, Plaintiff's Amended Complaint asserts the following four claims arising from her purchase of a motor vehicle in June 2006: (1) Defendants breached an implied warranty of merchantability, in violation of the Magnuson-Moss Warranty Act (15 U.S.C. § 2310[d]), by selling her a used car that was not in a merchantable condition in that it was not fit for the ordinary purposes for which such goods are used and would not pass in trade as a certified used car under the contract description; (2) Defendant Volvo Cars of North America, LLC ("Volvo"), violated Section 349 of the New York Consumer Protection Act and the Illinois Consumer Fraud and Deceptive Business Practices Act (815 ILCS 505/1 et seq.) by engaging in deceptive acts and omitting material facts of which it was aware, which resulted in public injury; (3) Defendants committed common-law fraudulent misrepresentation and fraudulent concealment by (a) falsely representing that the used car was certified, and (b) making a gross misrepresentation about the car's true condition; and (4) through Defendants' breach of implied warranty and acts of fraud, they conferred on Plaintiff the right to revoke her acceptance of the car and cancel the sales contract under Section 2310(d) of the Magnuson-Moss Warranty Act and Sections 2-608 and 2-721 of the Uniform Commercial Code. (See generally Dkt. No. 21 [Plf.'s Am. Compl.].) Familiarity with the factual allegations giving rise to these four claims in Plaintiff's Amended Complaint is assumed in this Decision and Order, which is intended primarily for review by the parties. (Id.)

B. Defendants' Motions

Generally, in support of their motions to dismiss for lack of subject-matter jurisdiction, Defendants argue as follows: (1) Plaintiff is not entitled to punitive damages under either the Magnuson-Moss Warranty Act or 28 U.S.C. § 1332, under the circumstances; and (2) as a result, the amount of available damages that Plaintiff seeks fails to exceed the jurisdictional amount of $50,000 under the Magnuson-Moss Warranty Act, or $75,000 under 28 U.S.C. § 1332. (See generally Dkt. No. 28, Attach. 3 [Def. Maguire Auto.'s Memo. of Law]; Dkt. No. 30, Attach. 2 [Def. Volvo Cars' Memo. of Law].)

Generally, in her response to Defendants' motions to dismiss, Plaintiff argues as follows:

(1) Illinois law--which governs the fraud claims, including the availability of punitive damages-- provides that Plaintiff is entitled to punitive damages; and (2) as a result, Defendants have not shown to a legal certainty that her claims do not, and cannot, exceed the jurisdictional amount of $50,000 under the Magnuson-Moss Warranty Act, or $75,000 under 28 U.S.C. § 1332. (See generally Dkt. No. 33 [Plf.'s Response Memo. of Law].)

Generally, in their reply, Defendants argue as follows: (1) New York law--which governs the fraud claims, including the availability of punitive damages--provides that Plaintiff is not entitled to punitive damages; and (2) as a result, Plaintiff has not sustained her burden of proving subject-matter jurisdiction by a preponderance of the evidence. (See generally Dkt. No. 35 [Defs.' Joint Reply Memo. of Law].)

II. RELEVANT LEGAL STANDARDS

A. Legal Standard Governing Motions to Dismiss for Lack of Subject-Matter Jurisdiction

In reviewing a motion to dismiss for lack of subject-matter jurisdiction, under Fed. R. Civ. P. 12(b)(1), the court must accept as true all material factual allegations in the complaint. Shipping Fin. Servs. Corp. v. Drakos, 140 F.3d 129, 131 (2d Cir. 1998). However, unlike the procedure when reviewing a motion to dismiss for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6), the court is "not to draw inferences from the complaint favorable to Plaintiffs." J.S. ex rel. N.S. v. Attica Cent. Schs., 386 F.3d 107, 110 (2d Cir. 2004).*fn1 This is because, as explained more fully below, "when the question to be considered is one involving the jurisdiction of a federal court, jurisdiction must be shown affirmatively [by the party asserting such jurisdiction], and that showing is not made by drawing from the pleadings inferences favorable to the party asserting it." Shipping Fin. Servs. Corp. v. Drakos, 140 F.3d 129, 131 (2d Cir. 1998). Similarly, unlike the procedure when reviewing a motion to dismiss for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6), the court "may consider affidavits and other materials beyond the pleadings to resolve the jurisdictional issues." J.S. ex rel. N.S., 386 F.3d at 110. However, the court "may not rely on conclusory or hearsay statements contained in the affidavits." Id.

Because each party argues, inter alia, that her/its opponent has failed to satisfy her/its respective burden on the pending motions, the Court finds that a few words are appropriate about the parties' respective burdens on the pending motions. At all times, "a party invoking the jurisdiction of the federal court has the burden of proving that it appears to a 'reasonable probability' that the claim is in excess of the statutory jurisdictional amount." Tongkook Am., Inc. v. Shipton Sportswear Co., 14 F.3d 781, 784 (2d Cir. 1994). Granted, this burden may be lightened by the use of "a rebuttable presumption that the face of the complaint is a good faith representation of the actual amount in controversy." Scherer v. Equitable Life Assurance Soc'y of the U.S., 347 F.3d 394, 397 (2d Cir. 2003). However, of course, this face-of-the-complaint presumption is available only if the face of the complaint alleges facts plausibly suggesting the existence of claims aggregating over the jurisdictional minimum amount in controversy. See, e.g., Jordan v. Verizon Corp., 08-CV-6414, 2008 WL 5209989, at *4, n.4 (S.D.N.Y. Dec. 10, 2008) ("In this case, however, because the complaint fails even to allege that the claims exceed $75,000, this [face-of-the-complaint] presumption does not apply.") (Lynch, J.).*fn2 In other words, in the event the complaint does not allege, on its face, facts plausibly suggesting that the amount in controversy exceeds the jurisdictional minimum, the court need not presume that the general allegation that the amount in controversy exceeds the jurisdictional minimum constitutes a good faith representation of the actual amount in controversy.*fn3 Moreover, in the event the complaint alleges on its face facts plausibly suggesting that the amount in controversy exceeds the jurisdictional minimum, a party challenging jurisdiction may rebut this face-of-the-complaint presumption by showing "to a legal certainty" that the amount in controversy does not meet the jurisdictional minimum. Scherer, 347 F.3d at 397.

Finally, it is important to note that, under the diversity jurisdiction statute, 28 U.S.C. § 1332, the amount-in-controversy threshold requirement is $75,000, which may be satisfied through an aggregation of "[d]ifferent state claims brought by a single plaintiff[.]" Colavito v. New York Organ Donor Network, Inc., 438 F.3d 214, 221 (2d Cir. 2006). However, in order to invoke federal jurisdiction under the Magnuson-Moss Warranty Act, three requirements must be satisfied: (1) the amount in controversy of any individual claim must be at least $25; (2) the overall amount in controversy must be at least $50,000, excluding interest and costs; [and (3) if the action is brought as a class action,] at least one hundred plaintiffs must be named to maintain a class action. 15 U.S.C. § 2310(3)(d).

B. Legal Standards Governing Plaintiff's Claims

Because the parties to this action have demonstrated, in their memoranda of law, an accurate understanding of the relevant points of law contained in the legal standards governing Plaintiff's claims in this action, the Court will not recite, in their entirety, those legal standards in this Decision and Order, which (again) is intended primarily for review by the parties. (See generally Dkt. No. 28, Part 3 [Def. Maguire Auto.'s Memo. of Law]; Dkt No. 30, Part 2 [Def. Volvo Cars' Memo. of Law]; Dkt. No. 33 [Plf.'s Response Memo. of Law]; Dkt. No. 35 [Defs.' Joint Reply Memo. of Law].) Rather, the Court will discuss those points of law only where necessary below in this Decision and Order.

III. ANALYSIS

A. Plaintiff's Claim that Defendants Breached the Implied Warranty of Merchantability Under the Magnuson-Moss Warranty Act

As indicated above in Part I.B. of this Decision and Order, Defendants argues that the dismissal of this claim is warranted because (1) Plaintiff is not entitled to punitive damages under the Magnuson-Moss Warranty Act (in part because New York law does not allow for punitive damages for breaches of warranty), and (2) as a result, Plaintiff has not alleged facts plausibly suggesting ...


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