United States District Court, D. New Jersey
YVONNE ROBINSON, ROSE CIROS, JESSE R. HOWELL individually and on behalf of all others similarly situated, Plaintiffs,
KIA MOTORS AMERICA INC., et al., Defendants.
MICHAEL A. HAMMER, Magistrate Judge.
This matter comes before the Court by way of Defendant Kia Motors America Inc.'s motion to dismiss the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), D.E. 10, and Plaintiffs' Cross Motion to Amend the Complaint, D.E. 15. The Court held oral argument on June 20, 2014. For the reasons set forth below, Plaintiffs' Motion to Amend is granted-in-part and denied-in-part. Defendants' Motion to Dismiss is therefore denied as moot without prejudice to Defendants' right to move to dismiss the Amended Complaint.
Plaintiffs Yvonne Robinson, Rose Ciros, and Jesse R. Howell filed the Complaint as a proposed class action against Kia Motors America Inc. ("Kia"). Plaintiffs alleged that there were latent defects in their 2003-2005 Kia Sorento automobiles. Essentially, Plaintiffs claimed their vehicles were designed with a "defective... crankshaft pulley bold and balancer, " which could result in "breaking off the spring guide pin, " causing "catastrophic engine failure." Compl., D.E. 1, ¶ 1. As a result, Plaintiffs sought damages in the form of "costly repairs, " and "diminished intrinsic resale value." Id . ¶ 2. Plaintiffs also alleged that "despite their longstanding knowledge of the problem, the Defendants failed to disclose to Plaintiffs and other customers that Kia Sorento model year First generation 2002-2009... are predisposed to have the front pulley balancer snap." Id . In sum, the initial Complaint brought claims for: (1) violation of the New Jersey Consumer Fraud Act, N.J.S.A 56:8-1 ("NJCFA"); (2) breach of express warranty; (3) breach of implied warranty of merchantability; (4) violation of the Magnuson-Moss Warranty Act, 15 U.S.C. § 2310(d)(1); (5) declaratory relief; (6) negligence; and (7) breach of contract.
On March 5, 2013, Kia moved to dismiss the Complaint for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6). D.E. 10. On March 18, 2013, Plaintiffs filed a cross motion to amend the Complaint. Id . Plaintiffs, however, did not attach their proposed Amended Complaint to their filing. D.E. 15. On September 16, 2013, Plaintiffs filed the proposed Amended Complaint. D.E. 18. On September 30, 2013, the Magistrate Judge then assigned to the case ordered the parties to submit supplemental briefing on futility in light of the Plaintiffs' late submission. D.E. 20.
Plaintiffs' proposed Amended Complaint seeks to add several new parties. According to the proposed pleading, the new Plaintiffs would be: Yvonne Robinson, Jesse R. Howell, Rose Ciros, Cheryle Moxey, Irene Goodwin, Robert McConnell, and Phillip Doran, acting on behalf of themselves and all other similarly situated individuals. Proposed Am. Compl., D.E. 18, ¶ 1. Plaintiffs propose a class of "current and former owners and lessees of certain Kia Sorrento [sic] model year First generation 2002-2009 motor vehicles equipped with a Hyundai-manufactured 3.5L 24-valve DOHC V6 engine through the present." Id . ¶ 50.
The proposed Amended Complaint also seeks to add new counts against Defendants. Some of the counts are limited to certain state sub-classes. The claims in the proposed Amended Complaint are:
Count 1: New Jersey Consumer Fraud Act, N.J.S.A 56:8-1 (on behalf of the New Jersey sub-class)
Count 2: Ohio Consumer Sales Practices Act, Ohio Rev. Code § 1345.01 et seq. (on behalf of Plaintiff Jesse Howell and the Ohio sub-class)
Count 3: Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. Ann. § 501.201 et seq. (on behalf of Plaintiff Cheryl Moxey and the Florida sub-class)
Count 4: South Carolina Consumer Protection Code, S.C. Code. Ann. § 37-1-101 et seq. (on behalf of Plaintiff Irene Goodwin and the South Carolina sub-class)
Count 5: Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 Pa. Con. Stat. § 201-1 et seq. (on behalf of Plaintiff Robert McConnell and the Pennsylvania sub-class)
Count 6: Washington Consumer Protection Act, Wash. Rev. Code § 19.86.010 (on behalf of Plaintiff Phillip Doran and the Washington State sub-class)
Count 7: Breach of express warranty (all state sub-classes)
Count 8: Breach of implied warranty of merchantability (all state sub-classes)
Count 9: Magnuson-Moss Warranty Act, 15 U.S.C. §2310(d)(1) (all state sub-classes)
Count 10: Declaratory relief (all state sub-classes)
Count 11: Negligence (all state sub-classes)
Count 12: Breach of contract (all state sub-classes)
Count 13: Common law fraud (all state sub-classes)
Proposed Am. Compl., D.E. 18, ¶¶ 125-218.
The threshold issue in resolving a motion to amend is the determination of whether the motion "is governed by Rule 15 or Rule 16 of the Federal Rules of Civil Procedure." Karlo v. Pittsburgh Glass Works, LLC, No. 10-1283, 2011 WL 5170445, at *2 (W.D. Pa. Oct. 31, 2011). Rule 15 states, in pertinent part, "a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires." Fed.R.Civ.P. 15(a)(2). "Rule 16, on the other hand, requires a party to demonstrate good cause' prior to the Court amending its scheduling order." Karlo, 2011 WL 5170445, at *2 (citing Fed.R.Civ.P. 16(b)(4)). As the Court has not entered a scheduling order in this case, Rule 15 governs the instant motion.
Under Rule 15(a)(2), a plaintiff may amend a pleading "when justice so requires." The Court may deny a motion to amend the pleadings only where there is: (1) undue delay, (2) bad faith or dilatory motive, (3) undue prejudice, (4) repeated failures to cure deficiencies, or (5) futility of amendment. Foman v. Davis, 371 U.S. 178, 182 (1962); Long v. Wilson, 393 F.3d 390, 400 (3d Cir. 2004) ("We have held that motions to amend pleadings [under Rule 15(a)] should be liberally granted.") (citations omitted); Grayson v. Mayview State Hosp., 293 F.3d 103, 108 (3d Cir. 2002) ("Under Rule 15(a), if a plaintiff requests leave to amend a complaint... such leave must be granted in the absence of undue delay, bad faith, dilatory motive, unfair prejudice, or futility of amendment."). Here, Defendants allege that the Court should deny Plaintiffs' motion because of the amendment's futility. Because Defendants do not oppose the motion based on undue delay, bad faith, or undue prejudice, and there is no Rule 16 issue, the Court considers only whether it would be futile to allow Plaintiffs' proposed amendments.
"Leave to amend a complaint is futile when the complaint as amended would still be properly dismissed or immediately subject to summary judgment for the defendant." Am. Corp. Society v. Valley Forge Ins. Co., 424 F.Appx. 86, 90 (3d Cir. 2011) (quoting Cockrell v. Sparks, 510 F.3d 1307, 1310 (11th Cir. 2007)); see also 6 Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 1487 (3d ed. 2010).
To determine whether an amendment would be properly dismissed, the Court employs the standard applied to Rule 12(b)(6) motions to dismiss. In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1434 (3d Cir. 1997). Under this standard, the question before the Court is not whether the movant will ultimately prevail, but whether the complaint sets forth "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); Hishon v. King & Spalding, 467 U.S. 69, 73 (1984) (establishing that a "court may dismiss a complaint only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations"); Harrison Beverage Co. v. Dribeck Importers, 133 F.R.D. 463, 468 (D.N.J. 1990) ("Futility of amendment is shown when the claim or defense is not ...