Unreported / Non-Citable
Background
Jean Harber bought a 2016 RAM 1500 truck in December 2015 and alleged that the vehicle’s exhaust gas recirculation (or EGR) cooler — a part that helps reduce emissions — was defective and could crack, leak coolant, and cause fires or sudden loss of power. She sued FCA US, LLC (the truck’s manufacturer) in Riverside County Superior Court in August 2024, asserting four claims under California’s Song-Beverly Consumer Warranty Act (the state lemon law), a claim for breach of the implied warranty of merchantability, and a claim for fraudulent inducement by concealment.
FCA removed the case to federal court under diversity jurisdiction and moved for judgment on the pleadings. Harber moved to remand, arguing the amount in controversy did not meet the $75,000 federal threshold.
The Court’s Holding
The court denied remand and granted judgment on the pleadings, dismissing every claim with leave to amend.
On remand, the court held that even though FCA estimated only $47,040 in actual damages, the maximum civil penalty available under Song-Beverly — up to two times actual damages for a willful violation — pushed the figure to roughly $94,080. Because Harber explicitly demanded that maximum penalty in her complaint, the court included it in the amount-in-controversy calculation, exceeding the $75,000 threshold.
On the statute of limitations, the court applied UCC § 2725, which gives buyers four years from the date of delivery to bring a warranty claim. Harber bought the truck in December 2015 and sued in August 2024 — well outside the four-year window. The court rejected her tolling arguments because she did not plead the time and manner she discovered the defect or explain why she could not have found out earlier through reasonable diligence. Without those facts, neither the delayed-discovery rule nor fraudulent concealment could save the warranty claims.
On fraudulent concealment, the court applied Federal Rule 9(b)’s heightened particularity standard — requiring the “who, what, when, where, and how” of the alleged fraud — and rejected what it called Plaintiff’s counsel’s “verbatim” template complaint. The court noted it had already dismissed virtually identical complaints by the same counsel against FCA in two earlier cases. The complaint described possible consequences of an EGR-cooler failure but did not say which actually happened to Harber’s vehicle. It generically referred to FCA “sales representatives” and unspecified marketing materials but did not say who Harber spoke with, what she relied on, or when. And the knowledge allegations — that FCA must have known about the defect through pre-production testing, consumer complaints, and warranty data — were a “shotgun approach” pleaded only on “information and belief” without any specific facts supporting that belief.
Key Takeaways
- Song-Beverly claims are governed by the four-year UCC § 2725 statute of limitations, which generally accrues when the vehicle is delivered.
- Plaintiffs invoking the delayed-discovery rule or fraudulent concealment must plead the time and manner of discovery and why they could not have discovered the defect earlier with reasonable diligence.
- Civil penalties up to two times actual damages count toward the federal amount in controversy when the complaint expressly demands them.
- Fraudulent concealment claims must satisfy Rule 9(b) — including identifying the affected component, the specific symptoms suffered, where and from whom the plaintiff received misleading information, and concrete facts supporting the manufacturer’s knowledge.
- Boilerplate template complaints copied across multiple cases do not absolve plaintiff’s counsel of the duty to plead case-specific facts.
- Allegations made on “information and belief” must be supported by facts that explain why the plaintiff actually has reason to believe them.
Why It Matters
Many California lemon-law plaintiffs file their cases years after delivery, hoping that the delayed-discovery rule or fraudulent-concealment doctrine will keep the claims alive. This decision is a sharp warning that those doctrines require concrete pleading — and that simply alleging a manufacturer “knew or should have known” based on testing data and consumer complaints will not survive Rule 9(b).
For consumer attorneys, the practical message is to tailor each complaint to the specific symptoms of the specific vehicle, identify dealership communications with particularity, and back any allegations of manufacturer knowledge with documents, articles, recall histories, NHTSA filings, or other concrete sources. For manufacturers, the order endorses an aggressive Rule 12(c) practice in older Song-Beverly cases and validates the use of templated counsel filings as evidence that the complaint at issue is itself a template lacking case-specific particularity.