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Marshall v. Hyundai Motor America

United States District Court, S.D. New York

September 30, 2014

KAREN MARSHALL, PAUL FLANNERY, and DARRELL R. WHITE, on behalf of themselves and all others similarly situated, Plaintiffs
v.
HYUNDAI MOTOR AMERICA, Defendant

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For Plaintiffs: Gary S. Graifman, Esq., Michael L. Braunstein, Esq., Kantrowitz, Goldhamer & Graifman, P.C., Chestnut Ridge, N.Y.

For Plaintiffs: Gary E. Mason, Esq., Nicholas A. Migliaccio, Esq., Whitfield Bryson & Mason, L.L.P., Washington, D.C.

For Defendant: Michael L. Kidney, Esq., Audrey E. Moog, Esq., John J. Sullivan, Esq., Hogan Lovells U.S. L.L.P., New York, N.Y., Washington, D.C.

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OPINION & ORDER

KENNETH M. KARAS, United States District Judge.

Plaintiffs Karen Marshall (" Marshall" ), Darrell R. White (" White" ), and Paul Flannery (" Flannery" and, collectively, " Plaintiffs" ) bring this Action against Defendant Hyundai Motor America (" HMA" or " Defendant" ) on behalf of themselves and a

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putative class of similarly-situated owners of Hyundai Sonata vehicles, model years 2006-2010. Defendant filed a Motion To Dismiss, which, for the reasons stated herein, is granted in part and denied in part.

I. BACKGROUND

A. Factual History

The Court accepts all of Plaintiffs' factual allegations as true for the purposes of the instant Motion. Plaintiffs purchased Hyundai Sonata vehicles (" Sonata" ) from Hyundai dealerships and subsequently experienced problems with these vehicles' brake mechanisms. (Am. Compl. ¶ 1-2 (Dkt. No. 24).) Plaintiffs claim that their vehicles' brake assemblies were defective and that these defects " cause the braking system components to become severely worn and damaged, [which] may lead to a complete failure of the braking system." ( Id. ¶ 2.) As a result, the parts at issue needed to be replaced, but Defendant refused to cover the cost of such repair or replacement. ( Id. ¶ 3.)

Plaintiffs' vehicles are covered by a " bumper-to-bumper" express warranty (" Basic Warranty" ), which covers " [r]epair or replacement of any component originally manufactured or installed by [HMA or several affiliate Hyundai entities] that is found to be defective on material or workmanship under normal use and maintenance . . . ." ( Id. ¶ 4.) The Basic Warranty covers a vehicle for five years or 60,000 miles, whichever comes first. ( Id.) However, it expressly provides that " brake pads and linings" are only warrantied in normal service " when the replacement is a result of a defect in material or factory workmanship," and that such replacement is only covered " for 12 months from the date of original retail delivery [or] date of first use, or 12,000 miles, whichever occurs first." ( Id.) Plaintiffs allege that " Sonatas are equipped with defective brakes," which cause significant squealing and premature deterioration of the rotors and pads and sticking of the calipers when the brake pedal is applied if the defect is not corrected by replacement of brake pads, rotors and calipers, and brake assembly. ( Id. ¶ 2.) If uncorrected, these defects " may lead to a complete failure of the braking system." ( Id.)

Marshall purchased a Sonata from Healy Brothers Hyundai in Mt. Kisco/Bedford Hills, New York in November 2005. ( Id. ¶ 23.) When Marshall's Sonata had about 11,297 miles, a problem with the vehicle's brakes occurred and Marshall brought the vehicle to the dealer, who replaced the brakes under the warranty. ( Id. ¶ 24.) In April 2008, when the same vehicle had about 42,782 miles, Marshall experienced vehicle vibrations when applying the brakes. ( Id. ¶ 24.) Marshall brought her vehicle to Falcon Hyundai, and was told that there was excessive wear on the vehicle's brake pads and rotors. ( Id.) Defendant refused to cover replacement of these parts under the Basic Warranty, so Marshall paid $429.45 for the replacement. ( Id.) Marshall's vehicle exhibited brake vibrations again in June 2010. ( Id. ¶ 25.) Marshall brought the vehicle to a local repair shop, which replaced the brake pads and rotors at a cost of $388.38. ( Id.) Again, Defendant refused to cover this cost under the Basic Warranty. ( Id.) Marshall noticed the same noises and vibrations in September 2010--less than 10,000 miles since the June 2010 repair. ( Id. ¶ 26.) As a result, Marshall decreased the frequency of long distance trips in the vehicle and cancelled some trips altogether. ( Id.)

White purchased a Sonata from a Hyundai dealer in Syracuse, New York in October 2007. ( Id. ¶ 27.) In June 2009, when White's Sonata had approximately 26,739

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miles, White heard a loud grinding noise when applying the brakes and brought the vehicle to the dealer.[1] ( Id.) A mechanic at the dealership allegedly told White that " this happens all the time" and that his vehicle required yearly brake maintenance. ( Id.) White paid approximately $310 to have his Sonata's brakes repaired, which Defendant refused to reimburse. ( Id. ¶ ¶ 27-28.) In September 2011, when White's Sonata had approximately 75,200 miles, it again experienced disintegration of the brake pads and rotors, necessitating another replacement at an additional cost of $473.43. ( Id. ¶ 29.)

Flannery purchased a Sonata from a Hyundai dealership in Watertown, New York in November 2007. ( Id. ¶ 18.) When Flannery's Sonata had about 22,205 miles, Flannery noticed loud notices and vibrations from the rear of the vehicle. ( Id. ¶ 20.) He took his vehicle to a local mechanic, who determined that that vehicle's brakes and rotors required replacement, at a cost of $317.85.[2] ( Id. ¶ ¶ 21-22.) Defendant refused to cover the repair or replacement of Flannery's vehicle's brakes and rotors. ( Id. ¶ 21.)

B. Procedural History

Plaintiffs filed this Action in New York State Supreme Court, Westchester County, in March 2012. ( See Notice of Removal ¶ 2 (Dkt. No. 1).) On April 18, 2012, Defendant removed this case from Supreme Court, Westchester County to this Court, pursuant to the Class Action Fairness Act 28 U.S.C. § § 1332(d) (" CAFA" ).[3] ( See Dkt. No. 1.) Plaintiffs filed an Amended Complaint on May 10, 2013. ( See Dkt. No. 24.) This Amended Complaint asserts six claims against Defendant: (1) deceptive trade practices and false advertising in violation of General Business Law § 349,[4] (2) breach of express warranty, specifically the Basic Warranty, (3) unjust enrichment, (4) breach of contract, and (5) a request for a declaratory judgment declaring that remedial work necessary to correct the alleged defect be covered under the vehicle warranty.[5] ( See Am. Compl. ¶ ¶ 54-99.)

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Pursuant to the Court's September 11, 2013 Scheduling Order, ( see Dkt. No. 29), Defendant filed a Motion To Dismiss and accompanying Memorandum of Law (" Def.'s Mem." ) on October 7, 2013, ( see Dkt. Nos. 30, 31). Plaintiffs filed their Memorandum in Opposition on October 28, 2013. ( See Dkt. No. 34.) In addition, Plaintiffs filed the Declaration of Gary S. Graifman in Opposition to Defendant's Motion (" Graifman Decl." ), ( see Dkt. No. 33), and Exhibits which include Plaintiffs' Proposed Amended Class Action Complaint (" PAC" ), ( see Graifman Decl. Ex. B). Defendant filed its Reply (" Def.'s Reply" ) on November 18, 2013. ( See Dkt. No. 38.)

II. DISCUSSION

A. Standard of Review

In considering a motion to dismiss pursuant to Rule 12(b)(6), the Court is required to construe the factual allegations contained in the Complaint as true and draw all reasonable inferences in favor of the plaintiff. See Ruotolo v. City of New York, 514 F.3d 184, 188 (2d Cir. 2008) (" We review de novo a district court's dismissal of a complaint pursuant to Rule 12(b)(6), accepting all factual allegations in the complaint and drawing all reasonable inferences in the plaintiff's favor." (internal quotation marks omitted)); Gonzalez v. Caballero, 572 F.Supp.2d 463, 466 (S.D.N.Y. 2008) (same). Moreover, " [i]n adjudicating a Rule 12(b)(6) motion, a district court must confine its consideration to facts stated on the face of the complaint, in documents appended to the complaint or incorporated in the complaint by reference, and to matters of which judicial notice may be taken." Leonard F. v. Isr. Disc. Bank of N.Y., 199 F.3d 99, 107 (2d Cir. 1999) (internal quotation marks omitted).

The Supreme Court has held that " [w]hile a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell A. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (second alteration in original) (citations omitted). Instead, the Supreme Court has emphasized that " [f]actual allegations must be enough to raise a right to relief above the speculative level," id., and that " once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint," id. at 563. Plaintiffs must allege " only enough facts to state a claim to relief that is plausible on its face." Id. at 570. But if a plaintiff has " not nudged [its] claims across the line from conceivable to plausible, the[] complaint must be dismissed." Id.; see also Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (" Determining whether a complaint states a plausible

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claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense. But where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not 'show[n]'-'that the pleader is entitled to ...


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