Unreported / Non-Citable
Background
Elisa Dolores Lewis purchased a 2020 Chevrolet Colorado for a financed total of $57,401.28 and, after repeated unsuccessful repairs of warranty defects, sued General Motors LLC in Los Angeles Superior Court under California’s Song-Beverly Consumer Warranty Act and the federal Magnuson-Moss Warranty Act (MMWA). She sought actual damages, restitution, a civil penalty of two times actual damages, attorneys’ fees, and other relief.
GM removed the case to federal court, asserting both diversity jurisdiction (Lewis is a California citizen; GM is a citizen of Michigan and Delaware, so complete diversity exists) and federal-question jurisdiction under the MMWA. Both bases turn on amount-in-controversy thresholds — $75,000 for diversity, $50,000 for MMWA. Lewis moved to remand, contending GM could not establish either threshold.
The Court’s Holding
Judge Stephen V. Wilson granted the motion to remand. The court began by calculating actual damages under the Song-Beverly Act, which equal the purchase price minus statutory offsets. Because the financing meant the amount “payable” differed from the amount actually paid, the court — following its prior order in Bastida v. Ford and Brady v. Mercedes-Benz — held that restitution is properly measured by the sum of payments actually made before suit was filed. That total came to $37,410.95 (after subtracting payments made after suit was filed). The court did not need to apply additional offsets (mileage, manufacturer’s rebate, etc.) because GM could not satisfy the threshold even using its best-case scenario of zero offsets.
On civil penalties, the court joined the line of California district courts that decline to include Song-Beverly civil penalties when the complaint contains only conclusory allegations of willfulness. Plaintiff’s mere recitation that GM’s violation “was willful” is insufficient; the defendant must point to specific allegations or comparable verdicts to justify adding the penalty to the amount in controversy. On attorneys’ fees, the court accepted that fees are includable under both Song-Beverly and MMWA, but GM had only suggested $5,000, which combined with the $37,410.95 in actual damages still fell short of the $50,000 MMWA threshold (let alone the $75,000 diversity threshold). The case was remanded.
Key Takeaways
- For Magnuson-Moss claims, federal jurisdiction requires an amount in controversy of at least $50,000 — separate from the $75,000 diversity threshold.
- When the financing makes the “amount paid” differ from the “amount payable,” restitution under Song-Beverly is properly measured by the sum of payments actually made before suit was filed (Brady v. Mercedes-Benz; Bastida v. Ford).
- Conclusory allegations of willfulness in the complaint are not enough to include the Song-Beverly civil penalty (up to twice actual damages) in the amount-in-controversy calculation.
- To carry their burden on civil penalties, removing defendants must either point to factual allegations supporting willfulness or provide evidence (verdicts, judgments) showing the likely penalty amount.
- Attorneys’ fees can be included in the amount in controversy under both Song-Beverly and MMWA, but speculative low-end estimates by the defendant will not necessarily push the case over the threshold.
Why It Matters
This opinion is a roadmap for plaintiffs’ counsel seeking to remand lemon-law cases removed under either diversity or MMWA. The key levers are (1) restitution measured by actual payments rather than the full financed price, (2) refusing to credit conclusory willfulness allegations as supporting the civil penalty, and (3) treating defendants’ low attorney-fee estimates as inadequate to meet the threshold. The MMWA $50,000 threshold is often the more dangerous one for plaintiffs because it is much lower than diversity’s $75,000.
For automakers and their counsel, the message is that successfully removing a Song-Beverly/MMWA case requires affirmative evidence of willfulness or a developed record of comparable verdicts — not just citation to the boilerplate of the complaint.