Free Affidavit - District Court of California - California

Case 5:08-cv-00868-RMW

Document 100

Filed 06/25/2008

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SPECTER SPECTER EVANS &MANOGUE,P.C. The26' FloorKoppers Building J Pittsburgb, Pennsylvania 15219 Tel: (4Lq6A-800 .+ Fax: (412)642-2309 E-mail:[email protected]
)

1 Joseph Kravec, (Admitted Hac Vice) N. Pro k.

)

(167416) MichaelD. Brarm 6 BRAIINI.AW GROUP, P.C. 12304 SantaMonicaBlvd-, 109 Suite Ios Angelc, CA 90025 TeL (310)442-77s5 8 Fax: (31,0)442-7756 E-mail:[email protected]
9

10 11 T2 13 L4 15 t6 l7 l8

Ira Spiro(67641) J. MarkMoore(1,80473) SPIRO MOSS LLP BARNESS, 11377 WestOlym.pic Blvd-,FiffhFloor LosAngeles, 90064-1683 CA Tel: (310)235-2468 Fax: (310)235-2456 E-mail:[email protected] nEft-6irofrossrco:::::::m Attorn sfor Plaintifs ey

(22LY2Q Janet LindnerSpieLberg I,AW'OFFICES OFJANET LINDNERSPIELBERG 12400 WilshireBlvd.,Suite400 Ins Angeles, 90025 CA Tel: (310) 392-8801 Fax: (310) 278-5938 E-mail:ilsoielbers(aihlo.com

UNTIED STATESDISTRICT COT]RT NORTHERNDISTRICT OF CALIFORNIA SAII JOSEDIVISION

1 9 SCHOLL, on behalf of themselvc and all 20 2l
v. othen similariy situated, Plaintitrs.

FELTON A- SPEARS,JR and SIDNEY

CASE NO.: 5:0&Cv40868 AME) CI,ASS ACTION AFFIDAVIT OF JOSEPE N. KRAVEC, JR IN SUPPORT OF PLAINTIFT'S' MEMORAI\IDUM IN OPPOSMON TO DEFENDAI\ITS' MOTIONS TO DISI\{ISS

22 23
WASHINGTON MUTUAL, INC., a

24 MUTUAL 25 26 27 28
Defe,ndants.

AFFIDAYIT JOSEPH KR/IVEC, INSTJPPORT FLAIIIIFFS 'MEIIOBANDI'UIN OPPOSIIONTO DEFE DANIE T'ONOI TO DEfiFS; OF I{. JR OF CASE NO.: 8:C41/{088a (RMW)

Case 5:08-cv-00868-RMW

Document 100

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I
z
J

JOSEPHN. KRAVEC, JR, of full agg uponhis affialavit herebycertifresasfollows: l. and of I am anattomeyat law ofthe Commonwealth Pe,r:nsylvania, havebeenadmitted

pro hac vice to the refernced action I am a partnerwith the law firm SpecterSpecterEvans & malter. As such, I have personal Manogue,P,C., afiomeys for PlaindfFsin the above-captioned hereit knowledgeofthe factscontained

4

6

2.

in I makethis affdavit in naport of Plaintiffs Responses Oppositionto Defendants'

WashingtonMutual Bank's and First American eAppraiselT'sMotions to Dimiss, and Lender's 8 9 Inc.'s Motion to Dismiss. Services, 3. Atfachedhereto as Exhibit 1 is a true and correct copy of Plaintiff SiclneyScholl's

1 0 SettlemeirtStatementwhich was attachedas Exhibit 1 action to Plaintiffs' original ClassAction 1l Complaint filed in this action, and which is specifically identified in Plaintiffs' First Amended

72 CompLaint paragaph 58. at 13 4. Attachedhersto as Exhibit 2 is a tue and correct copy of Plaintiff SiclneyScholl's

L4 'Appraisal of Real Property''which was alta.hed as Exhibit 2 to Plaintifs' original Class Action 1 5 Complaint filed in this actioq and which is specifically ide,ntifiedin Plaintitrs' First Amended 59 1 6 Complaintat paragraph andidentified asPlaintiffScholl's "appraisalreport"" 17 l8 l9 5. Attachedheretoas Exhibit 3 is a tue and conect copy of PlaintiffFelton A. Spears'

which wasattached Exhibit 3 to Plaintiffs' original ClassAction Complaintfiled as ClosingStatement in this action,andwhich is specifcally identified in Plaint'rffs'First AmeruledComplaintat paragraph 63.

2L 22 23
.A

6.

Attached hereto as Exhibit 4 is a true and corrrct copy of the Court's decisionin

Chamberlanv.Ford Motor Cornpany,No.C 03-2628CW CN-D. Cal.,August 3,2003xiVilken, D.J.)

25 26 27 28

vec, Jr.(Pa-ID 6

SIIBSCRIBED BEF'ORE DAY OFJUNE,2008.

'UEIIORAIIDI.|U OPFGIIION TO DEFETD'nffg I@TIOUI TO !d}UE8; AFFIDAYIT JOSEP}II{. KRAVES, N AUPPOFT PI.AIUNFFS OF JR OF IN CASE NO.: 5r084vq!888 (Rln{)

Case 5:08-cv-00868-RMW

Document 100

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I

PROOT'OF SERVICE

2 STATEOFPENNSYLVANIA

is My 26fr aeeof 18 andhofa Dartvto the wittrin action. Mv businessadclress The 26ft Floor I 5 KoppersBuilding Piusburgh,Pennsylvania 5219. 6
,7

) SS.: 3 COUNTY ALLEGTIENY OF J I Pemsvlvania. I amover the I qn er.nployed theC_ounty.ofAllegheny,-State in v. Stateof Pen:rpylv Districtof California's Electronic On June25.2008. usingtheNorthsrn Case FilingSystem, thEECFID registered Joseph Kravec, I filed andserved ynth to N. Jr., oescnDed as: tnedocument(sJ ATF'IDAVIT OF'JOSEPHN.KRAVEC, JR IN ST]PPORT OF PLAINTIFFS' MEMORANDT]MIN OPPOSITION TO DEFENDANTS'MOTIONS TO DISNflSS

8 9 l0

The ECF Svstem desipned automaticallv is to eensrate e-mail messaEe all an to partiesin thecase, which constituteg s_ervice. Accorilfig to theECF/?ACERsyitem,for l1 ihis case, partiesareserved follows: the as

12
.i.J

LindnerSpielbergEsquire Janet Ira Spiro,Esquire RobsrtIra Spiro,Esquire J, MarkMoore, Esquire MichaelD. Brauq Esquire Robert Pfister,Esquire J. MartinL. Fineman, Esquire Stephen MichaelRunmage, Esquire SamN.Dawood, Esquire Jonathan Lloyd, Esquire M.

j [email protected] [email protected] [email protected] [email protected] senrice@braunlawgroup. com [email protected] [email protected] [email protected] [email protected] j [email protected]

I4 15

t6 18 t9 2A 2I 22

t7 Attorneysfor Platntiffs

23 Attorneys for Defendant Washington Mutual, Inc. 24 LauraJean Fowler,Esquire [email protected] 25 Attorneysfor DefendanteAppralselT 26
t1

Margaret AnneKeane, Esquire Kris HueChauMan,Esquire AngelaM. Papalaskaris, Esquire

[email protected] [email protected] [email protected]

28

Case 5:08-cv-00868-RMW

Document 100

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I
t

ChristopherJ. Clar( Esquire Kevin C. Wallace, Esquire JefteyD. Rotenberg, Esquire Richard Hans, F. Esquire

[email protected] [email protected] [email protected] [email protected]

3 4 6 8

5 Attorneysfor Defendant LSI Appraisalo LLC

OnJune25,20A8,Iserved document(s) dessribed the as: AFF'IDAVIT OFJOSEPHN. KRAVEC" JR IN SUPPORT OF PLAINTIF'X'S' MEMORANDUM IN OPPOSITION TO DEFENDANTS' MOTIONSTODIS1VtrSS

13
L4

9 ly.placing a tue copy(ies) thereofenclosed a sealedenvelope(s) in addressed as Iollows: 10 Kerr;i.For{ CunningharnEsquire l 1 Patrick J. Smith-Es-quirc' Thacher Proffitt& WoodLLP t2 Two World Financial Center New York, New York 10281 Attorneys for eAppraiselT Kris H. Man"Esouire One Embarcadero Center SanFrancisco, 94ll | -3619 CA

15 DewevandLeBcieufLLP 16 Suite400 T7 18 L9

Attorneys for LSI Appraisal, LLC I servedthe abovedocume,nt(s) follows: as BY MAIL. I am familiar with the firm's Dractice collectionandorocessins of postage-thOreon firllyprepaid at Pittsbqrgh, fennsylvani-a seryicE on.thatsarirc day

20 correspondence mailine. Underthaturactice would bedeDosited U.S.oostaT bv it with
$th 2l m m orornarycourseoI Dusmess.I ,m awaretnat on mofion ot tlle Dartv servecl isprestmed service thari orpostage meterdat6isrirore invalidifpostal-c.qncellationlple 22 onecay ansr oateoI ceposltlor marlmgm an afndaut.

23 24 26 27 28

d in .. I am,empl-oyed thF office of an attomeywho is admitte pro hac vjce in this acuonat wnose(urecuontne servlcewasmade, I declaregnderpenalty of perjury under the laws of the United Statesthat the

25 aoovels trueandcorTect.

Executedon June25,2008, at Pittsburgh,Pennsylvania"

sA4ABcrAZ. CARNEY
Nrarcra uarnev L.

Case 5:08-cv-00868-RMW
and UrbanDevslopmont FINAL

Document4:08PM 100-2

Filed 06/25/2008
VA

Page 1 of 3

2W2-02.A5

1..[ I FHA

2. t I FMHA
6. DqConv.ln8.

3. t I Conv. UnrB.

SettlementStalement
8g9nlalo 8hown. lGms n8*ed CPOC')vrsrepardoutsrdg cro3rng:thsy are tho*n herebr'rnformsdon thE

817Northrest1s4Tenace, Edmond, ?3003 OK Plseofsetuement 4401 W. MsmorlalRoad,Sulte*100, Oklshoma City,OK 731g4

120. Gross amount due from borrorron

Orosa amout|t dug to ssllen

215. Ostober Renr

tU+nOOA n7Omffi

OctoberRenl

.tO4tZOga--to-lontnOtf;

Tob'l raduf//on In amour due eelec

SawlnnahBuild;reLLc

Case 5:08-cv-00868-RMW

Document 100-2

Filed 06/25/2008

Page 2 of 3

Case 5:08-cv-00868-RMW
I hrYo crBfulyrgrtssd

Document 100-2
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Filed 06/25/2008

Page 3 of 3
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Case 5:08-cv-00868-RMW

Document 100-3

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Page 1 of 12
lFioffiffiE6-lEoe'#Zl

APPBAISAL REAI PROPERTY OF

TOGATEII AT:
817 NW 194th Tef Lot 2 Block 3 Stonebrlar Sec 1 Edmond,OK 73003

FOR:
Washbrglon MutuauoAppralsstt 75 N Fah[Jay Dr Vemon H[b, It 60061

AS OF:
09t17n8

BY:
FFrebethJ AnSeb

Form - llinTolt{..appralsd GAI sonc,arB lamods, * l{Fr,t-Ajt oDE b, a hc.

Case 5:08-cv-00868-RMW
Surirm:rylippraleal Repori

Document 100-3

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Page 2 of 12

ArEolo A$rdlslSevice, (405) hB. 340-1056

ResldEnilal

I## X":HJHgP
aflyttarclalnsslsbncs salo {oandurgss,

ggolo*om

FDddls Form Mac 20SS March 2005

Pags of 6 1

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knnl9 M8B Form 2055March 2005

tum2(65- lffiifoTrll appralsat byah nodo, _ softtrarB tnc. 1-o0trAtAMoDE Completed behalfof eAppratselT. on
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Case 5:08-cv-00868-RMW

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Resldentlal
817 NW 194th Ter 194i7 Crsl Rbse DrlvB

pr b D* "yqr.ry ::as.bjE $,bj8d cornptsfon tD Ll8ubjeottt8lolmt4r@ts0ralErd{0m 0n uE.basira hroothdcal uraturelhnoranmmnB h; edid;; 0l c0rdfron h,rs drd lmpocdon basd
ontlE odaonilm|y tssumfi0n to coldifdn dsArtennu ,t tt nrtrt*n*xnn nrmn'tr N^ tu,,rthd m Ao*

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FloFrlt fion al l@t hs 8@. dffi rutu| valua, df,ngd $b Gal as of Frsddls Form Mac 2055MarDh 2005 pags ot 6 2

sbMtqtt ts roqdd Fannle Form Mas 2055 March a)05

F0rm - 'lyhfuru'L 265 appnlsal snltlan ah mods, - 1&ALAM0DE by hr. Completed bebalfof eApprdselT. on

Case 5:08-cv-00868-RMW

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Resldsnflal

Frcddle Form Mac 205b t\rarch Z00S

g Fhg 016 Form - lrJhf0Tlt'appnl6al 2lb5 softrarB atamod8, _ 1.$$ALAMoDE by t&.

Fannts Form Mao ArSS Marcn 2005

Completed behalfof eAppaiselT. on

Case 5:08-cv-00868-RMW

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lffifioffiIffiAil 092783-(pr46897-{'

Re6ldenflal

propsrty a ons-unlt propgrty wlli an accsssory uniU of or Ihls rsponform ls dsslgned reportan appralsal a ons-untt b (PUD). lncludlng unlt In a planngd dovolopmsnt Thls r8portlorm ls not dsslgnod rBport appralsal a b an of a unlt pr0J6cl manufacurod nomeor a unlt ln a condofidnlum cooperatlvs or 'Ihls ap alsal roportls sublect tho lollowlng to scopoof worlqlmBndsd Inbndod uso, ussr,deflnldon marl@t ot valuo, statom8nt assumpdons llmt0ng of and condltorc,and c8rullcatons. Modmcafons, addltons,or dglsdorls fie lnbndod t0 uss, Intandod usor,dsflnluon market value,or assumptons llmlflng and ot condltons not pormlttad. appralsor arc Tho may oxpand scopsof wort l0 Includs addltonal ths or any Esoarch analysls n8csssary bassd0n tlrs complodty thls appralsJ 6f asslgnmsnl Modltlcaflons delstons trs cortflcadons alsonot psrmlttsd. or b ars Howsvar, addldonal cerfiicafions do fiat not consfitjtomatodal alteratons lhls appralsal to rsport,suchas thosorogulred law or thosorBlabd Sls appralseFs by to oonflnulng oducdonor msmbg|shh an appralsal ln organhaton, pormltH. aro Ths SC0PE OFWORK: gqgpo workfor thls appralsal ddned he complodty thls appralsal of ls by ol asslgnmem the and reporflng rsqulrsmsnb thls appnlsalrcponfurm, lncludlng followlng of tho dsflnltonot markst'valus, strtsmantof 'lhe assumpuons llm]0ng and condldons, cortrflcaions. appralssr and (1) musl at a mlnlmum: perlorm vlsualInspgcton a ol propsrty tho oxtorior areas ho subJEct ol tromat least sfBsq(2) lnspsct nelghbbrhood, Inspsct tle (3) tro eaih of fts comparablo sajosfrom at leastho sfe6t, (4) resoarch, fy, andanalyzo from mllablo publican'd/or vot pdvato dab sources, and (5) reporthls or hgr analysls, odnlons, concluslons thls appalsalreporl and In The_appralssr bs ableto obtalnadoquaiB must about charactoristcs but _lrd.ormadqn tfre physlcal 0ncludlng, not llmlbd !0, condlUon, couc lross.lMng. room proporty the e)dsrlor-only froin publlc Ins'pecton Gllablo lnO {8a, stc) ofirs subjsct prlvato and/or sourcos to.pMormthls appralsal. appralsor Tho should ths samotyps ot dalasourcos he oi shouses uso mat tor comparable suchas, but.not ales llmf@d multpls to, prlor llsflng soMces, andasssssment bx records, tnspscnons, appralsal fllBs,lrformaionprovlded fis proporty by owner,tc. INTENDED USE: Tholntended of ti s appnJsal uso reportis lor th6 londsr/cliont evaluate property ls tho to tho fiat subloct thls appralsal a mortgags of lor flnadiefansaiflon. INTENDED USER:-lhslntendod of thlsappralsal ussr report ths tendorlcllerL ts

markot undor condtdons atl roqursito.. farJ to .a s4g,gq.buyor-and tiach sotrei, aitns -detlntflon tnoiliilsuoryanoiiirimrng thoprlcs.ls n$..qtfo$d by.unduo.sdmulus.. thts lmptlctt.ln ts uisconsumnfftb-no' ;'iat';';J;i spicmeo anfi oao mopas-slng ttle fromsellsr buyor ot to under condl8ons (1) whoroby: uuysr ioitsraretvpt"ntvmotirrrtro; boh iarx8s ano -Oi6t (2) arewolllntormod wolladvlssd, each or arid actng.ln what oi siio'con'stdors or noroffi he. hls iitirsq flm9ls allowed oqosuro thoopon_markq paymom madiIn torms cash u. s. olniii or an6i A b;dabt; tor ln (41 ts of 'relro.sonts tn Siha of d;nch arrangomonb comp_arablB and(5) the prlc-e horeto; &s normal toi It .cgngia;raitoii'iliffip;rty sorounailscbd spsclal crsawo 0r nnanclng salss or graibdby anyone condessloris* assoclatBd thosalo. wlth b or cmatvs. flnanclng sales :4g!rytneqb tto comparables bt-,T."99,JtJ or coircesslons. N0 am nocsssary lhosscosts for pald lqrylal i whlch 1u* arongryatly by letten.as ilul oiGiiiton oi-iii in-'ilri]ilii['gr"; adlusrnsnb -oi'iiiiib thsss cosbars roadllv ldenffiabls lho ssllar pays slnco thes:otose--tn vtrurattiatt qansaitcr'is. sdtes sii;rii nnrncr,s adlustnents bo mado the cbniparable can to property idnibarisoris fl-nallc!;i;bt q Cmri:6trrr6l i'i,rro party iii Inslrrtgnat londor ls notalreadv bat lnvolvod tr qryprryor ta;sacfo,-n: ad,usrnent ln Any should bocalculabd a mochanlcal not on dollar dollar ot ihe flnanclng. cbndession tireoittarliroum ot anyadlustnont for cost or nut -' should approdmab mai.,fs tho r@cuon thoflnanclng conceellons to or lasedonfii iipra6iTs-lijognent STATEMENT 0FAssUMm0NsANIIUMflNGcoNDmoNs: Theappratssrs csrtrffcaton ftls rgpon subloct In F t0 thotollowlng assumpdons llml0ng and conAmoni: 1' liheappralser notborssDonslblo.tor. of a loggt wlll matbrs nauro.that afiect. olfierhs propsrty bolng appratssd fte iits or b lt' oxcept lntormaflon for that'hs_or Pocaqre. afiyar6'-&ljiig-fie rosearcn hvotved isrt5rmrn'g'firs in appralsal. .shs maftsubrs Ths appratsor assumss ho mo rs soodand that anowirrninrdnoii;"t.dii,-t*;#d;'itru iiii;.

DEHNfl0N 0F MARKEIVALUE,.Tfo mgit plobable prlce whlcha proporty shoutdbrhg In a compofiuvs opsn -pn',iiiini;, and

Because appniieils survevor, iioti rrs or-irreilidJ''il;ffintees,'orpress or i$TitrT.?g:&fifl'*"rrffi,f.ffi1 irie
appralsor tosflmony.or In hB l:,-rhi specmc wlll notglvB made appralsal thgproporty quesflon, an of h -appear courtbecause or shs. unross arrangemsntsdo so hayo'dsen to made berorohind,'or oiri'eriiierd;id-ty H:" "' aJ

2 Theappralsor examlnod avallabls maps arepmvlded lhefo.deral has $e flood 'reporr that by Managemert .Emergency sourcos) has and nobd_ln appralsat wnfuie'i poriion ts- suoiiii'ifti 6 ii:ineornanAgncy thls Igrg$elqata any or

dJiing rhlrinroniii-tii riijiri p,iprrtyor thatho or rhs !P-s11c-0-g snso8camo awaro durlno resoarch st he Involved porformlno appgtsai. hi -oi'uiiiilrfiriiii tr6 lirffi oiliilild';iaffi h thtsapprdtsal report' appralser no lclowlodge lho has ot.iny iriooi'n ptrvsrcat dsflctonctss or adverss condluonsthe of propsrty as,butnotlmitd n8sdod-repan, 'iri,iiiirti presonce (such Ostenoffion; ih, of hazardous F, wasbs,-brtc subshnces, sdvorss onvhonmental condltons. hat w6uiii-#rcstc.)' yaluabls, hasassumod th'm arono such ross and that condnons makes ouaraniees wanantes, tt. oi -lriii6o.irre ipprarieiw:rrritrt and no in em^:i l-ri'd'sjinisrore anysuch ror condltons do efst or tor anvenOneerhg that oi-idrii;-tiai rtitTr rBqutred to whoftor conrtiflons iuch odsl Because appralser notani4eft tn nd nero bivtiii.'#iffir i,,rros, thts dtscowr th' ls ot appralsal report mustnotbe constdorBd as an envlronmental assessmsnt tie pmperty. of 5' Thoappralsor based or hff appralsgl andvaluaflon has hls rspglt concluslgn anappralsal ls subJect saflsfactorv for that b me'issumpttin tna h;;ilr'et';n,

4' Thoappralsor nobd In this. has appralsal report advorse any condldons ns-edd repalrs, dstoflgraflon, {such.as the hazardous wasbs,. sutsuncei,etc.fobsrilsd b)dc

F3fll#[?'i#i'i],S.flfrffiHrSl
FrBddlB Form Mac 2055March 2ff,5

reparrs, oraniiiorir,:oiiid-ri'u"t wuris pmperry

pags ot I 4 hrm2S5- ry'ftfoTAl' appntsat sonrywoI h msdo, _ I-SISAIAMoDE by lnr.

Fannls Form MaB 2055ManhZ00g

Complaedon behalfof eApprdelT.

Case 5:08-cv-00868-RMW

Document 100-3

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Page 6 of 12
lHla 29687561 #71 No. Pass 03-278&m47468S7-0

Resldentlal
'lhs APPMISER'S CERIIFICA'IION: Appralsor csrtllss and agrssstut

1.. I havs,.at.a mlnlmum, dswlopsd reporbd appralsal accordanco ms scopsof work regulremenb and thls In wlth stabd ln thls appraisal report 2; .l psrlormsd vlsuallnspscton a of-_the s,(brlo.r.arcas the subjsctpropsrty ot lrom at loasttls sfesl I roportsd condfiorl Ue In.lacual,. sp.cmc torms..l ldontflsd mportd physlcal and the dsllclonclBs could hat atfBct lvab tty, hs 91_I9_|I!rqfT:Ssoundnsss, structural or Integrlty tho propO. of S l.pertormed appralsal accordanco the roqulBments &e Unlform thls In with of Standads Professlonal of Aooralsal PftIctlcs .wsrs.doptsd promulgatod the Appnlsal mat and by Standards Board lhs Appralsal ot Foundaton thatworoln ' and placoat the dmethls appralsal report *as prspared. of valuoot hs rsal propsrty ls tho sublBct thls roportbassdon tho salos that ot lt I oq.topuOfiry oplnlon the market companson approacn valuo. havgadequab to I compardblo marlGt dah to.dovsiop rollablo'sals a compadson appmach for fits alpratsalasstgnmonl further.certfjr I crinstdered cost ananCims'approicnisto 6rue niit dio'nJiiivirJp I tlrat uro tnom,unless otheMlss Indlcatod fils reoot In 5.. I rBsarchod, vsrtflod, analyz8d,. ropoqdon.anycunent ang agrsomsnt tor-.sale the.-ani pmperty, offsrlng tor sublect any tor property he twolvs pdo-r ln io.he ettefrvg. :alo ol t]0 sublect me sirpa .rnoltfrs lato of $ls appratsal, itre'priorsates'or -ra-fi,i-' propertv a mlnlmum throsy6arspdoro ho oflocrvodatsot rr|s Cppratsat, tor ol ifiiss-irrsiiirrd lftrcabd in ttG a .f rBsarchod, vedflod, analrzod, roporbdon the pdorsalg,s p.e comparabls ot salostor a mlnlmum onoyoarprior ot .and t0 ths &t6 sf sale of tlo comparablo unlsssothg.,vlss ssls, lndfcat8d thls'rsport ln 7. I ssloctsd ussdcomparabls ttat arotocauonally, and physlcany, tunctonally mostslmll to fts subloct salss and ths propsrty. 8' l.havo usodcomparable tftatwgrsitls rBsult comblnlng tano wfi tro contract not salss of a sate purchaso ot a hom prlcs frd hasbesn or wlllbs-bullt thotand. bullt on 9' I havsrBportsd ad.lustnents ths comparablo nat reflsctfio marksfsroacton ths dtfigBncos b sales t0 Detwsgn subJsct ho prDpsrty ths comparable and sales. 10' I vermed, a dislnbrsstod from In fiat by 9ll P-ulg9t Inlormadon thlsrBport waspmvldsd part8swhohavsa nnanclal lmerest ln thosaleor flnanclng ths subloct propsrty. of 11. I havoknowlodge oxpsriencs appralshg typo of property tnls markst and In thls In ara" 12' I amaware andhavo ot, ,.t"T.19'-T-t-lu!S,aryandappmprlat8 andprtvatB sourcos, as muttplo public dab such flsthg seMcss' asssssmont tax rocords, publlc rocords- othbr land ano iuctrtiaa sourCei nJ ar; il;h-tc; tto propsrty tocgtDd. ioi Is

lftrJ,rtlt;|,jl:Xrtlfl#iHfig$J #r#ffi,#f

tumrshsd parres oerssed appralsar from byorhsr and Inthis rsport coplntons

14' I havo Eken consldsratonqctors havs lmpact lmo q9 an wlfi to netghb0rhood, prop8rtv,,andpro{mltv thesublect $sto--dcvJid onvalue rospe{t fie subloct sublsct $o or propertv rffiriin-cesttJ divii;il;stii;;d';i'ffi1 rn g| marksr I yatus. havo Inthlsappralsal nobd aaJersb-C6nouiniiiirr,'iT'b,rr i;,1ii;'riri',.iifirriJ,'liaerro"aon, not-rimne; pres'nce hazardous ropott.anv t,, of wasbs' iuusences, t'dc aoversie'iirrriiniliirilr co-ffiil#.i;ftil"d*ai,ihg" tr,, Inspocuon proportv that bBcamo ol durlris Esearcn s, he suDjocr 0r I awars ttrs iiiioivao.rn porrdnldrf -vatrie, tfiriifiiiiu]lihiru constderod adverso heso condlflons In
mv analvsls ne property ot. maftebblltty fis sutilBctpropeny. of anatrii;o"riiiirmdon tts oftsctof thoconditons thovatuo on and 15 1have knowlngly not wfiheld anyslgnmcantormaton thlsappralsal lr trom roport to fis bostol my knowlsdge, and, all $aEmsnBand lnformEuon ttrts airpralsal In reponaro tuo anO'coirecf 16' l sbbd h thlsappraisal moodmy unblasod, professlonal and analysls, .own oplnlons, conctuslons, and whlch arc sublect b heassumpdons onty anirntrng fidfrd;l;ifij;dpi.]rr, *pon porsonal,

17.I hava pressnt orusnsdf no or pppartf.that subJect renort, I haye presom lstho o,fils and no prospectve .,.S"rytl -gg tnir or personat irrbtas. inbrbst wfth.respect pdrtctpants tri rirUe'ransa&ibi. ;rt d_6,;i,fu pafialy i;ii' or

iiJ*8ffi''"tlrln'i'$ffiffiT "

prss8nt ownsls occupanb no properdsa victiiiw or ot i,i'ttri iii'fiil{u-irectpruperty onarry or other barlsprphrblbd raw. by 18 Myomployment comDBnsaflon and/or portormlng appmlsal. qqre or anuclpated fo-r thls or flry appralsals not was condlflonedanyasroementunoersuriotn6,-'rffiiin".i 0n oi report h'ysts suppordng) prod'brmlned "mt"imiirii i,t'rifiiJilmrt t.,wo-utd (oriresenr a speclflc value. oredetomlnod a vil,ii l'lr",irio rn a that fie or aspecirlc ijriildijni-riii''ii or drrErflonvalus, valuo Tavors causs 'esutt aliLmc

ii!!:8fu[!,iHi';,H:t.st^&,!#ffi..8'sr-]tii i'#$?#%ft$T:*H#trils,Jl,,
subsequern everit isuinlJiipro/ar pild;d' ora

andoplnlons about roateqb gdfie set relled slgnmcant orooerv rsportlf I 0n real aopratsat. assi&niitro'i-irvi'iirrr,irat, Ind'id;Uifi torthln hls appralsal apprajsal or lvgro iil ffiffi;'., orthts 0rthepropanflontrls-ao'orallat t tuwllmet rrir-ri'iriiit,ii,itr) ol rbport and. dtsctossd-spoctflc portormod fto -nt-vj,riit"irffirizeo ln hls bsks appralsal lcertfvtirhanv roport tndivlorial $;am;d isilffniii'tiiierronn ttre any.ne n'ks b rtem fils apiratsat mirerin,d'vtiii;d'#'de r0r'ii es6.l In report ipi'riiai'ii d;d;ffi lr.'l;l3,E,,,HrTI and wurake I no

19' I p8Bonally pr9parsd concluslons all

Frsddls Form Mac 2055ltarch2005

Pags ol8 5

Fadolo Form Mao A0ES March 2005

-'it'lnmTAl appratsal byatamods, _ hrmm55 sftwarB ttr. 1.000_AtAS,lOttE

Case 5:08-cv-00868-RMW

Document 100-3

Filed 06/25/2008

Page 7 of 12
Paro lFfl 29687561 *81 No. 0$27&dr4748897-0

Resldenilal

t|at tor or organlzdon, agent tho organhaton roportwhols the IndMdual, In 20. I ldeffiflodtho lndor/cltsnt tnF appralsal roport rscslve appralsal hls orderBd wlll and ne at to: anshsr lendor the rBqusst.of rBport ths bonows|,; or may 21. Iho lender/cllsm dlsclose dlstlbutethls appralssl glttgrprlses; govsmmfftotnersponsorsd Insurors: mortgags and or the inortgagee- lls succsssoG asslgns; bonowsn -pa-rflclpanb; protosslonal organlzdons; dopanmsr4 any appralsal ssrvlcos; data collgctonor rBporflng market secondary havhg t! wtthout or of aoencv. tnsfum6ntattWdreUnlbdSms: anddnysEb, th Dlstictof Columbla, ohor lurisdlctions; 6r bsforo apprdsal ftls mustbo obblned consont. Suchconsont oi appral66fs apillcablo) o-Utaln-iho appralsois supervlsory ff publlc tlroughadvartslng, brit to, m or rsportmaytitj dlsclosed A|sttbr.rteOanyotheipany(hcluding, not limltod thBpubllc mlatons,nsws,sales,or othormgdla). may rcportby ms or tho londor/cllent bo sublsctln certaln 22. I am awarc anydlsclosure dlstibutonof ftls appralsal tnat or Pracfice of ol Appralsal to Strndards Protssslonal Furttrer, am also sublect ths provlslons fio Unilorm I lawsand regulatons. by thatpertaln dlsclosuro dlstlbuton m8. to or th8 or and rnortgago oJ 23. Thebonowor, anoherlondor hs requost ths bonower, mortgagoe Assuccossors asslgns, at padclpartsmaymly on thls appralsal gov6mm6nt rBport paft as markst Insurors, sponsorod and enbrpdsm, oher socondary that any ol anymortgago nnancs transscion Involvos onoor moreof tese partos. algnahlrs," ti0se termsars as 24. ff thls appnlsalroport wastansmlusd an "slocfonlcrecord'contalnlng "elsctronlc as my rocordlngs), a lacslmils or tlnsmlsslonof thls doflnod sppllcablo In tederal and/or sEb lafls (excludhg audloandvldBo and appraisal reportconulnlng copy or rsprBsgna$on my signatro,tfie apprahal a of rsportshallb0 as sffscfvo,onforceablB valldas if a paper vorslonot thls appralsal rBport w0rs dollvorsd collhlnlngrIry odglnal handwitlBn slgmurs. 25, Any Inton$onal ngglgsntrnlsmprssorffion(s) In or contalned ftls appralsal rcponmay rosuttIn cMl llabllltyand/or ponaltosincludhg,but not llmltgd fln6 or lmprlsonrn8rt bofi undor provlslons Tltle 18, Unttod crlmlnal to, or tho ot S't8bs Codq, SecUon 1001,ot soq.,or slmllar sbb laws. 'mo SUPERVISORY APPMISER'S CERTIHGATI0N: SupoMsory Appralser certflssandagrass tna! '1. I dlrecfly supeMssd appmlsor tnF appralsal ths lor havo asslgnmslt, read appralsal llls reportandagrs fie appralsoFs wlh analysls, oplnlons, sbbm8nts,concluslons, ths appralssfs and csrtffcaton. 2. I accspt rosponslbllity bs conbnB0t thls appralsal full lor report hcludlng, nol llmitod tirs appralsB/s but b, analysls, oplnlons, strtBrnents, concluslons, thg appralsgr's and cortflcatlon. 3. Tl'!sgqPral.s{ ldsnfflsdln thls,appralsal r8poi lg ollhff a sub-cortracbr an employ8 ths supeMsory (or or of appralssr tho appralsal firm), ls qualltlsd perfurm appralgal, ls accoFhblo psrform appralsal to thls and to thli undsiho appttciOte sEto'law. 4, Thlsappralsal. rop-ort compllss fiB Unlform $n Standards Protosslonal of Appralsal Practcsthst wersadopbdand promulgatod hs Appralsal by Shndards Board Ths Appralsal ot Foundafion trat wor8ln placoat ths trire hls appralsal anii Eport was proparBd. 5. _ltthls appraisal Jsport wastransmlttsd an "elsctronlc as record"c rtalning "oloctronlc rny slgnauro," t|03o tsrmsaro as dsllned appllcablo ln todoral andorEbb laws(flcludlng audlo vldeo and reCordtngs), tacilmlle or a Eansmlsstonthls sf apprslsal conhlnlng copyor roprosontsilon slgndrro, appralsal a of my $e redi,rt shallbe as sffecfivo, entorceable anO .report valldas ff a paper vo]Blon thls appralsal 0t rsponwsre dellvorBd conulning origlnal rny handwrttBnslgnatjro. SUPERVISORY (ONLY REOUIRED) APPRAISER IF Slgnatno Namo Company Namo Company AddrBss Tolophono Number(40$940-i ss6
EmallAddfoss [email protected]

Dats slgnatJro Rsport ogimlz(XE ot and Efiectvo Dats Appralsal 09/17/I)0 d StrtoC8rtflcafon 1i243CRA #

T8lophone Numbor Emall AddBss DatB Slgnaturo ol

orStats Llcanss # (dsscrlbe) oroth8r
SEb OK

StdB Cerfflcdon # orsutoLlcenss #

strb #

sts

belradon of Csrtrffcaton Ucense Dsb or SUB.IECT PROPERTY subject tr DldnotInspoct prop8rty Dldlnspoct pmperty stsst odsrlor sublect of tr from Dats Inspscfon of COMPARABIT SALES odorior n DldnotInspsct of comparabls fromsfsst salss salss tr Dldhspecto(brlorol comparabls fromstBet Date lnsDscdon of

EqlratonDato CerfflcdonorUconse gtalE@,g ot ADDRESS PROPERTY OF APPRAISED 817l.tw 'l94th Tsr
Edmond,OK 73003

APPHAISED VALUE SUBJEST OF PROPERTY 2SS,OOO $ LENDEFi/CLIENT NamB
Company Name Washhoton MutuaueApprsbsn Company Addrsss 75 N Fsh,,rav Vemon Dr, Ht[s. 60061 EmallAddrsss [email protected] FrBddle Form Mac 2055 March 2005

pags ot 0 6

Fannls Fom2055 Maa Manh 2005

hrm2055 'VVhI0TAI'appratsal byah mods, - t-8o&ALAfitODE sdl$ar6 Inc. Completed behalfof eApprdselT. on

Case 5:08-cv-00868-RMW

Document 100-3

Filed 06/25/2008

Page 8 of 12 mJ{o--e6itimlEos?dl

$ublect Photos

SubloctFront
817llw 194th Ter' SabPdGo 28s,000 0m3! tlvhriArEa 2,546 ToUlRoorB I TohlBdrlo[B 4 TotalBatllnoms3 Locdon SbrEbrbr Vlffi Awnnterlor slto 8,,f00sq.Fr +/ennry 1,6B* Comp/A

SublsctRsar

Subloct S-trest

- lt/ttloTAf Form nCPKSR apprabsl by lamodq _ l-Bm-ALf sofurarB a lnc. oDE
Completed behalfof eAppratselT. on

Case 5:08-cv-00868-RMW

Document 100-3

Filed 06/25/2008

Page 9 of 12
lftoM:Efr TssTraoB*-10-l

Gomparable Photos##
lonower/Cn8ri SHnsvsc.trol
ftoDertv Addr6s 817 NW 1g4th Ter Cltv Edmond Lsnder Wastfialon [,lutEuaADorablt CoLrry okbhoma SlrtE OK Zr Cdda73003

Gompamble1
821f,lw 1994th Proc SubJBst 0.05mlles b E sal6Pdcs 283,000 Gr6s LjvlngAra 2,.180 TohlRoo[B 8 IoElBodoor8 3 TotdBdmoms 2 Locadon Sionebrlar Visw Aw/lnterlor sib 11,500 +/sF AlEfty l BrkComp/A
Agg Nq f

'1 7 CrsstRldge S41 Driw Pror Sobjact 0.06mfles b E SabPdco 282, ,1 G|!ss Uvlno ArBa 2,419 TohlBoom 7 TohlBdroo[E 3 TohfBdhmoms . 12 Localon Stonsbrlat VIsw AwLtterbr Slb 12000 +/SF oEllly 1 BrkComp/A Ago

Comparabls 2

GomFarablog
1609 Redlad Pror.tDSub@ 2.43m[6sNE Sals Pdco 296,000 Gross ArBa 2,830 Ltulng ToblRoDnE 9 TohlBsftoom 4 ToblBdlrooms 9,1 LocsJon Cheyenrpcroos Msw Awnnbrbr sib 16000 +/sF Ouallty 1.5BrkComp/A AgB Nsv

-'lt/hloTAL turm PICPKCR appmhal by ta softnas a mods, - 1-m0-AIAM0DE tr.
Completed behalfof eApprdiselT. on

Case 5:08-cv-00868-RMW

Document 100-3

Filed 06/25/2008

Page 10 of 12
I l-Fld'b-m.2s6s-m6lEos7fi

i1

,.n
s

if
i&

l

Form SCA-ryhToTAt apfiabal GsftuarB lanode, _ 1-800_AIAM0DE bya tD. Completed behalfof eAppratselT. on

Case 5:08-cv-00868-RMW

Document 100-3

Filed 06/25/2008

Page 11 of 12 tffifrd:ffiTffi?i?il

':l

rffi
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!+i'*l{i}1hql [ ., 0 i;*i:i*!-;; ,

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hrmSCA ryftiruTAt apprahsl by h modr, _ l&).AtA!r0DE s!tuFdro a ll[.
Cornpleted behalfof eAppdselT. on

Case 5:08-cv-00868-RMW

Document 100-3

Filed 06/25/2008

Page 12 of 12
m-No-;6ffidlPaop#-int

LooatlonMap

turnMrPf@ .lthIUTAL' pprdsal sonwasalsmdafD._ t-f00-ALAMoDE by
Conpletedon belralfof eAppratselT.

Case 5:08-cv-00868-RMW

Document 100-4

Filed 06/25/2008

Page 1 of 2 ge:a4Pn

q,osrNc sTAltsMENT rucERS/BORi.O$rEnS
Esdmated
Buttr8oForven Felto! A Spcatd Toul Slenn
&qot{No:

100' Cspldwsv'Sutte cttDPq9.!'qlry-o^o9 .... '-ifuirot,tloq : : 901 Fe$ ('f0t)37-0284--sr'guzc

TITLEGOilIPANY ALLIANCE

JLt 1151?5s8$1 MBn007

CbscDe ProradoDag
Del3Prspatld.

I Nrrtl.,oArrcgARcssr

ENCUMBRANCE: AI{D EXIITUNG NEIW Aon Refrnalca Worhbgto MqtudEatk
Fc ADDraisal !o Washiiglonllullal B!!k fax Scrvicoo vasltalo! Mutrr8lBek FloodDetemiostiono L$dAneriag Tax & Flood & Fuadlng 8crllow Fte to WaEbbgFoM[ru81B&k $/irr Trosfer Fe! to We$ingon Mutnl Bonf Pa)'neDt hccsdng O Woshi$@ lfitlttal nanL b WaSbEloEMs|al Banx Gcdtr4ustlE(flt!!f PE"aid hlsrest to W?sliqgto! Mcttsl Bete ' To From03/1207 04/01/07 @$3l.0tptalay p W08bitrgtolMutttstBdk Itaz-ord Insrlanco 3 nos. @ S?4'0duonth MunralBonk CourryPropsnyfores to wo3hinSlon 3 oor' @$f 66.a9inodh RECORDING FESS: Fe6to A!lia!!r Tltle Coryaly Rscording Tiile Cofinony lo Re.ord8.clasc Alldancc ADDITIONAL CEANGEST ' Advl6e(If Necdld) t{omsq'lrrs lllora^[ca Ptsnd'IE to Plcaso PAYOFFS:

il78,000.00

36!.00 i 81,(nl
{80.00| 35.00 |

srol

(e8o.o0l 621.Eo I u.wl
I

200.00l

4ss{71

,r,*l
1E.001

600.00 i

PryotroWold Savhp
S154,1555t ftbciptl Bolslle F S561.75lnteregt ota6/01i2007to 03i16t007 $551.78 I!q!$ ?,5n7-tnv07 $aloo RecoarqaaceFee Fec 380.00 Stolesuot

$rrr,423,u I

I
I

I

lttgl3ttw

Case 5:08-cv-00868-RMW Document 100-4 ANl, l'llr.iD UltdtrtDli o Londers Policy$I7E 000.00 Alhascfi{o coryuy . Delfiru4/Couda to Delfuuiru Autnc!TtthCoq6y

Filed 06/25/2008

Foe Escrtlv o.Alla:rcsTltlc Ooqrany f'16 Allioocc TltleConnary .Norsy Spb Tolo Refimil Buytc/Bqmr$r Duc 'roral3

Page 2 of 2 584_00 65.00 250,00

l5E$1638 19,383.62

17E,0q1.00

sr7&000.00 sl?8.00000

FIDIA. Splors

To Speer

Case 5:08-cv-00868-RMW Case 4:03-cv-02628-CW

Document 100-5 Filed 08/06/2003 Page 1 of 2323 Document 26 Filed 06/25/2008 Page 1 of

1 2 3 4 5 6 7 8 9 10 SUSAN CHAMBERLAN, BRIAN CHAMPINE, and HENRY FOK, on behalf of themselves and all others similarly situated, and on behalf of the general public, Plaintiffs, 13 v. 14 15 16 Defendants. 17 18 Plaintiffs Susan Chamberlan, Brian Champine, and Henry Fok 19 (Plaintiffs) are suing Defendant Ford Motor Company (Defendant) 20 for violations of the California Consumers Legal Remedies Act 21 (CLRA), Cal. Civ. Code § 1750 et seq., and the Unfair 22 Competition Law (UCL), Cal. Bus. & Prof. Code §§ 17200 et seq. 23 Defendant moves pursuant to Rule 12(b)(6) of the Federal Rules 24 of Civil Procedure to dismiss Plaintiffs' complaint for failure 25 to state a claim and files a request for judicial notice. 26 Plaintiffs oppose the motion and the request for judicial 27 notice. 28 The matter was heard on August 1, 2003. Having / FORD MOTOR COMPANY, and DOES 1 through 100, inclusive, No. C 03-2628 CW ORDER GRANTING IN PART DEFENDANT's MOTION TO DISMISS AND DENYING IT IN PART IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA

United States District Court

11
For the Northern District of California

12

Case 5:08-cv-00868-RMW Case 4:03-cv-02628-CW

Document 100-5 Filed 08/06/2003 Page 2 of 2323 Document 26 Filed 06/25/2008 Page 2 of

1 2 3 4 5 6 7 8 9 10

considered oral argument on the motion and all of the papers filed by the parties, the Court GRANTS Defendant's motion to dismiss in part and DENIES it in part and GRANTS Defendant's request for judicial notice. The Court also GRANTS Plaintiffs

leave to amend their complaint. BACKGROUND Plaintiffs bring this action on behalf of themselves and all similarly situated persons residing in California who purchased certain automobiles (Subject Automobiles)1 manufactured by Defendant. In relevant part, the complaint alleges that

United States District Court

11
For the Northern District of California

beginning in 1996, Defendant manufactured, sold, and distributed Subject Automobiles containing defective intake manifolds. Compl. at ¶ 2. Plaintiffs allege that no later than January 1,

12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

1997, and possibly earlier, Defendant became aware that a large number of intake manifolds in the Subject Automobiles were cracking prematurely, exposing drivers and their passengers to serious risk of injury. Id. at ¶ 4. Plaintiffs allege that

Defendant's testing and records showed that the intake manifolds failed at a "much higher rate than was to be expected from a properly functioning manifold, and was occurring much more quickly than the expected life of the part." Id. at ¶ 5.

Starting in January, 1998, Defendant began to offer several extended warranty protection, or "recall," programs for free

replacement or repair of the defective intake manifolds for some Subject Automobiles include Mercury Grand Marquis (19962001), Ford Mustang (1996-2001), Ford Explorer (2002), Ford Crown Victoria (1996-2001), Lincoln Town Car (1996-2001), Mercury Cougar (1996-1997), and Ford Thunderbird (1996-1997). 2
1

Case 5:08-cv-00868-RMW Case 4:03-cv-02628-CW

Document 100-5 Filed 08/06/2003 Page 3 of 2323 Document 26 Filed 06/25/2008 Page 3 of

1 2 3 4 5 6 7 8 9 10

of the Subject Automobiles.

Id. at ¶ 6.

Plaintiffs allege,

however, that Defendant extended this offer almost exclusively to fleet purchasers of Subject Automobiles such as taxi cab companies, limousine companies, and police forces. Id.

Plaintiffs allege that by failing to send the recall letter or offer the recall program to the vast majority of consumer purchasers of Subject Automobiles, Defendant "concealed from and/or failed to disclose to Plaintiffs and the Class the defective nature of the intake manifolds contained in the Subject Automobiles." Id. at ¶ 7. As a result of these

United States District Court

11
For the Northern District of California

defective intake manifolds, the Subject Automobiles purchased by Plaintiffs and the Class "did not perform in accordance with the reasonable expectations of Plaintiffs and the Class­namely, that the automobiles were suitable for normal use as a passenger vehicle." Id. at ¶ 8.

12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

The complaint alleges that Plaintiff Brian Champine bought a 1996 Ford Thunderbird on September 13, 2000 and the intake manifold cracked on March 28, 2002 at about 88,000 miles. at ¶ 12. Id.

Plaintiff Susan Chamberlan bought a used 1997 Mercury In June, 2002, the intake manifold in her car Id. at ¶ 13. Plaintiff Henry

Grand Marquis.

cracked at about 60,000 miles.

Fok bought a used 1998 Mustang GT convertible, and in March, 2003, the car's intake manifold cracked at 70,000 miles. ¶ 14. Plaintiffs allege that Defendant, "through its own Id. at

efforts and through its network of authorized dealerships acting as its agents . . . warranted, advertised, distributed, and sold its automobiles throughout the state of California." 3 Id. at ¶

Case 5:08-cv-00868-RMW Case 4:03-cv-02628-CW

Document 100-5 Filed 08/06/2003 Page 4 of 2323 Document 26 Filed 06/25/2008 Page 4 of

1 2 3 4 5 6 7 8 9 10

16. Plaintiffs' CLRA claim alleges that Defendant engaged in "unfair competition or unfair or deceptive practices in violation of Civil Code sections 1770(a)(5) and (7) when they failed to disclose that the Subject Automobiles contain defective intake manifolds." Id. at ¶ 29.

Plaintiffs' UCL claim alleges that Defendant engaged in "unfair competition or unlawful, unfair or fraudulent business practices in violation of the Unfair Business Practices Act when they omitted to disclose that the Subject Automobiles have defective intake manifolds." Id. at ¶ 34. Plaintiffs request

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12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

damages, restitution, and attorneys' fees. LEGAL STANDARD A motion to dismiss for failure to state a claim will be denied unless it appears that the plaintiff can prove no set of facts which would entitle it to relief. Conley v. Gibson, 355

U.S. 41, 45-46 (1957); Fidelity Financial Corp. v. Federal Home Loan Bank, 792 F.2d 1432, 1435 (9th Cir. 1986), cert. denied, 497 U.S. 1064 (1987). Dismissal of a complaint can be based on

either the lack of a cognizable legal theory or the lack of sufficient facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990). All material allegations in the complaint will be taken as true and construed in the light most favorable to the plaintiff. NL Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986). However, "conclusory allegations without more are insufficient 4

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to defeat a motion to dismiss."

McGlinchy v. Shell Chemical

Co., 845 F.2d 802, 810 (9th Cir. 1988); Smilecare Dental Group v. Delta Dental Plan, 88 F.3d 780, 785 n.6 (9th Cir.), cert. denied, 519 U.S. 1028 (1996).

DISCUSSION I. The CLRA and the UCL The CLRA makes illegal "unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods or services to any consumer." § 1770(a). Cal. Civ. Code

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12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Among the proscribed activities are

(5) Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities which they do not have or that a person has a sponsorship, approval, status, affiliation, or connection which he or she does not have. (7) Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another. Cal. Civ. Code § 1770 (a)(5), (7). The CLRA "shall be liberally

construed and applied to promote its underlying purposes, which are to protect consumers against unfair and deceptive business practices and to provide efficient and economical procedures to secure such protection." Cal. Civ. Code § 1760.

The UCL prohibits "unfair competition," which includes "any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising and any act 5

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prohibited by Chapter 12 (commencing with Section 17500) of Part 3 of Division 7 of the Business and Professions Code." Bus. & Prof. Code § 17200. Cal.

The UCL provides for monetary relief in the form of restitution: "Any person who engages, has engaged, or proposes

to engage in unfair competition may be enjoined in any court of competent jurisdiction. The court may make such orders or

judgments, including the appointment of a receiver, as may be necessary to prevent the use or employment by any person of any practice which constitutes unfair competition, as defined in this chapter, or as may be necessary to restore to any person in interest any money or property, real or personal, which may have been acquired by means of such unfair competition." Prof. Code § 17203. II. Defendant's Request for Judicial Notice Defendant requests that the Court take judicial notice of Cal. Bus. &

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For the Northern District of California

12 13 14 15 16 17 18 19 20 21 22 23 24

Assembly Bill No. 292, which documents some of the legislative history of the CLRA, and of the warranties for Plaintiffs' vehicles. Although generally a court may not consider material beyond the pleadings in ruling on a Rule 12(b)(6) motion, "documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the

25 26 27 28 Chapter 1 prohibits false advertising for a variety of businesses. 6
2

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pleading, may be considered." 454 (9th Cir. 1994).

Branch v. Tunnell, 14 F.3d 449,

A court may also consider documents which

are not expressly incorporated into the complaint, but "upon which the plaintiff's complaint necessarily relies." Parrino v.

5 6 7 8 9 10 FHP, Inc., 146 F.3d 699, 706 (9th Cir. 1998). Federal Rule of

Evidence 201(b) permits courts to take judicial notice of adjudicative facts when they are capable of accurate and ready determination by sources whose accuracy cannot reasonably be questioned. Defendant has submitted Assembly Bill No. 292 as it was

United States District Court

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For the Northern District of California

12 13 14 15 16 17 18 19 Court will judicially notice them for purposes of this motion. 20 21 22 23 24 25 26 into lifetime guarantees. 27 28 7 Plaintiffs respond that their claims III. A. Defendant's Motion to Dismiss Warranty introduced to the California Legislature on January 21, 1970 and as amended on May 22, 1970. The Assembly Bill is a public

record whose accuracy cannot be reasonably questioned. Defendant has also submitted copies of the warranties for Plaintiffs' vehicles. Because Defendant's motion must be denied

in relevant part even if the Court considers the warranties, the

Defendant contends that Plaintiffs fail to state a claim under the CLRA or the UCL because Plaintiffs cannot use these statutes retroactively to convert their vehicles' warranties

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are not warranty claims and that the CLRA and the UCL provide relief to consumers, regardless of the warranty involved, if the defendant engages in unfair, unlawful or fraudulent business activities.

5 6 7 8 9 10 Defendant relies on several cases to argue that because the intake manifolds failed after the warranty had expired, Plaintiffs cannot bring claims under the CLRA or the UCL. e.g., Seely v. White Motor Co., 63 Cal. 2d. 9, 16 (1965) (manufacturer's failure to comply with its obligation under warranty entitled purchaser to recover damages resulting from
For the Northern District of California

See

United States District Court

11 12 13 14 15 16 17 18 19 at *3 (N.D. Cal.) (granting Rule 12(b)(6) motion to dismiss 20 21 22 23 24 25 26 expiration). 27 28 8 claim for negligent misrepresentation of product quality where claim, sounding in tort, was based on false statement made during the performance of a commercial sales contract); Abraham v. Volkswagen of Am., 795 F.2d 238, 249-50 (2d. Cir. 1986) (warranty does not cover defects manifested after warranty's such breach of warranty); Standard Platforms. Ltd. v. Document Imaging Sys. Corp., 1995 WL 691868 at *1 (N.D. Cal.) (granting Rule 12(b)(6) motion to dismiss fraud claim that defendants knew but failed to disclose specific defects in the products because plaintiff impermissibly attempted to "tortify" contract law); Greentree Software, Inc. v. Delrina Tech., Inc., 1996 WL 183041

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None of the cases relied on by Defendant holds that a defect manifested after the expiration of a warranty precludes a plaintiff from bringing claims under the CLRA or the UCL. effect of warranty expiration is not included in the plain The

5 6 7 8 9 10 language of the relevant sections of the CLRA and the UCL. To

state a claim under these statutes, a plaintiff must only allege that the defendant engaged in unfair business practices. For

these reasons, Plaintiffs' complaint cannot be dismissed on this ground. B. Duty of Disclosure

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For the Northern District of California

12 13 14 15 16 17 18 19 the UCL does not require a plaintiff to allege that the 20 21 22 23 24 25 26 Defendant also contends that Plaintiffs' complaint is 27 28 9 defendant has a duty of disclosure. Although Defendant argues The plain language of the relevant sections of the CLRA and Defendant argues that Plaintiffs' complaint must be dismissed because Plaintiffs have not alleged and cannot establish that Defendant had a duty to disclose information about the allegedly defective intake manifolds.

that a manufacturer or a seller has no duty to make disclosures to the buyer, it has cited no case law to show that such a duty must be alleged in order to state a claim under the CLRA or the UCL.

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insufficient as a matter of law under Rule 9(b).

Defendant

relies on Vess v. Ciba-Geigy Corp., which held that, although fraud is not a necessary element of a CLRA claim, if a plaintiff chooses to allege in the complaint that a defendant has engaged

5 6 7 8 9 10 in fraudulent conduct, the pleading of that claim must satisfy the particularity requirement of Rule 9(b) of the Federal Rules of Civil Procedure. 317 F.3d 1097, 1103-04 (9th Cir. 2003).

Defendant claims that Plaintiffs have plead fraud but have not specified when failure of the intake manifolds is so premature and so frequent that Defendant has an obligation to disclose it

United States District Court

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For the Northern District of California

12 13 14 15 16 17 18 19 1998, Defendant concealed the defects when it sold the 20 21 22 23 24 25 26 their Subject Automobiles did not perform in accordance with 27 28 10 automobiles while advertising that they were of sufficient quality for normal use and when it offered an extended warranty program to fleet purchasers of Subject Automobiles but not to the vast majority of consumers. Compl. at ¶¶ 4-7. Plaintiffs or what Plaintiffs' "expectations" were regarding the durability of the manifolds. In the complaint, Plaintiffs allege that no later than January, 1997, Defendant became aware that the defective intake manifolds were failing at a "much higher rate" than the "expected life of the part," and that beginning in January,

also allege that because of the defective intake manifolds,

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their reasonable expectation that the cars would be "suitable for normal use as a passenger vehicle." Id. at ¶ 8. Thus,

Plaintiffs have alleged when Defendant became aware of the defect, what the defect was, when it concealed the defect, and

5 6 7 8 9 10 what the Plaintiffs' expectations were regarding their vehicles. Therefore, to the extent that Plaintiffs' claims sound in fraud, they have alleged facts with sufficient particularity to satisfy Rule 9(b). For these reasons, Plaintiffs' complaint cannot be dismissed on the ground that it did not allege a duty of
For the Northern District of California

United States District Court

11 12 13 14 15 16 17 18 19 App. 3d 30, 36. (1975), Plaintiffs argue that concealment of 20 21 22 23 24 25 26 fraudulent misrepresentations about certain specifications of 27 28 11 design defects is prohibited by the CLRA. In Outboard Marine, disclosure or that it did not allege fraud with particularity. C. Concealment

Defendant argues that Plaintiffs fail to state a CLRA claim because they do not allege any affirmative misrepresentations by Defendant. Citing Outboard Marine Corp. v. Superior Court, 52 Cal.

the plaintiff brought a class action alleging that the defendant, a manufacturer, fraudulently concealed a design defect in its vehicles. Id. at 34. The plaintiff also brought

a second cause of action, alleging that the defendant made

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the vehicle in violation of the CLRA.

Id.

The defendant moved

to dismiss the first cause of action on the ground that it was covered by the CLRA. Id.3 The trial court denied the motion.

The court of appeal held that the motion to dismiss should have 5 6 7 8 9 10 been granted because the CLRA provided the exclusive remedy for conduct encompassed by the act and the first cause of action was based on the same conduct as that alleged in the second cause of action. The court concluded that because "an active concealment

has the same force and effect as a representation," the CLRA includes a proscription against "a concealment of the

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For the Northern District of California

12 13 14 15 16 17 18 19 alleged that Defendant made any misrepresentations about the 20 21 22 23 24 25 26 27 28 At the time this case was decided, the CLRA provided the exclusive remedy for conduct encompassed by the act. Section 1752 now provides that the CLRA is not an exclusive remedy. 12
3

characteristics, use, benefit, or quality of the goods contrary to that represented." Id. at 37.

Defendant seeks to distinguish Outboard Marine by noting that the plaintiff, unlike Plaintiffs in this case, alleged that the defendant made positive misrepresentations in addition to concealing facts. Defendant argues that Plaintiffs have not

durability of its intake manifolds.

Defendant also argues that

by using the word "representing" in § 1770(a)(5) and (7), the legislature meant affirmative misrepresentations and not concealment. Defendant further supports this interpretation by

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noting that § 1770(a)(21)4 provides that the failure to disclose certain characteristics of "grey market goods" is a violation of the CLRA. Defendant argues that because the legislature

included concealment in one provision of the CLRA and did not do 5 6 7 8 9 10 so in another related one, the legislature intended to make concealment actionable only in the case of "grey market goods." Defendant's arguments are unpersuasive. First, although

Defendant is correct that the plaintiff in Outboard Marine, unlike Plaintiffs in this case, alleged that the defendant made positive misrepresentations, this distinction does not affect

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For the Northern District of California

12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Section 1770(a)(21) prohibits the "[s]elling or leasing goods in violation of Chapter 4 (commencing with Section 1797.8) of Title 1.7." Section 1797.81 provides that "[e]very retail seller who offers grey market goods for sale shall post a conspicuous sign at the product's point of display and affix to the product or its package a conspicuous ticket, label, or tag disclosing" certain characteristics about the product (e.g., the item is not covered by manufacturer's express written warranty). "Grey market goods" means "consumer goods bearing a trademark and normally accompanied by an express written warranty valid in the United States of America which are imported into the United States through channels other than the manufacturer's authorized United States distributor and which are not accompanied by the manufacturer's express written warranty valid in the United States." Cal. Civ. Code § 1797.8(a). 13
4

the court's determination that concealment of product defects is equivalent to misrepresentation for the purpose of analyzing claims brought under CLRA. Second, Defendant's attempt to infer legislative intent from Chapter 4 of Title 1.7 (Consumer Warranties) is

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unpersuasive.

Title 1.7 is not part of the CLRA, and it does The CLRA

not contain the word "conceal" or "concealment."

merely incorporates Chapter 4 of Title 1.7 to prohibit certain acts and practices in the sale of grey market goods. The

5 6 7 8 9 10 relationship between the CLRA and Chapter 4 is too attenuated to infer the legislative intent of the terms in the CLRA from language in Chapter 4. Nothing in the CLRA indicates that concealment is not the legal equivalent of misrepresentation. Rather, the statute

United States District Court

11 specifically provides that it shall be "liberally construed" to
For the Northern District of California

12 13 14 15 16 17 18 19 Plaintiffs' complaint has alleged sufficient facts to show that 20 21 22 23 24 25 26 Plaintiffs bought the cars with the expectation that the cars 27 28 14 Defendant represented that its vehicles would be of a particular quality that they are not. In the complaint, Plaintiffs allege promote its underlying purposes, which include protection of consumers against unfair and deceptive business practices. Civ. Code § 1760. Cal.

Liberally construed, the CLRA's proscription

against unfair and deceptive business practices encompasses Defendant's alleged concealment of product defects. Even if concealment were not actionable under the CLRA,

that Defendant "warranted, advertised, distributed, and sold" its automobiles. In this way, Defendant represented that its

cars would be of sufficient quality for normal use, and

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would be suitable for normal use.

Plaintiffs allege that the

intake manifolds in the Subject Automobiles "did not perform in accordance with the reasonable expectations of Plaintiffs and the Class--namely, that the automobiles were suitable for normal

5 6 7 8 9 10 use as a passenger vehicle." Compl. at ¶ 8. Therefore,

Defendant allegedly represented that its vehicles would be of a quality suitable for normal use even though they were not. Cases cited by Defendant to support the proposition that concealment is not actionable under CLRA are inapt. In Vess v.

United States District Court

11 Ciba-Geigy Corp., a plaintiff sued the maker of Ritalin and two
For the Northern District of California

12 13 14 15 16 17 18 19 plaintiff saw or relied on the organizations' advertisements or 20 21 22 23 24 25 26 vehicle brought an action against the automobile dealer and the 27 28 15 that they made misrepresentations. Id. at 12, 16. For these non-profit organizations for conspiring to increase sales of the drug in violation of the CLRA. 2001 WL 290333 at *2 (S.D. Cal.,

Mar. 9, 2001), aff'd in relevant part, 317 F.3d 1097 (9th Cir. 2003). The court found that the non-profit organizations did

not market or sell the product, there was no transaction between them and the plaintiff, and there was no allegation that the

reasons, the court granted the non-profit organizations' Rule 12(b)(6) motion to dismiss the CLRA claim. The court did not

hold that concealment is not actionable under the CLRA. In Bescoes v. Bank of America, a plaintiff who leased a

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bank that financed the lease. (2003).

105 Cal. App. 4th 378, 382

The plaintiff claimed that the bank was liable under

the CLRA for failing to include a certain notice in its lease agreement as required by federal law. Id. at 385. The court

5 6 7 8 9 10 rejected the plaintiff's CLRA claim because the federal law did not apply to his case and the bank therefore did not engage in a deceptive practice by not including the notice. Id. at 395.

The court did not hold that concealment is not actionable under the CLRA. Therefore, the CLRA claim cannot be dismissed on this

United States District Court

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For the Northern District of California

12 13 14 15 16 17 18 19 As stated above, the CLRA prohibits "unfair methods of 20 21 22 23 24 25 26 other person, whether or not the agreement is a contract 27 28 16 competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods or services to any consumer." Cal. Civ. Code § 1770(a). The CLRA defines basis. D. Transaction

Defendant contends that because Plaintiffs bought used vehicles and did not buy them from Defendant, they fail to state a CLRA claim in that they have not alleged that they entered into a transaction with Defendant.

"transaction" to mean "an agreement between a consumer and any

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enforceable by action, and includes the making of, and the performance pursuant to, that agreement." 1761(e). Defendant argues that the California Legislature intended Cal. Civ. Code §

5 6 7 8 9 10 the CLRA to apply only to a defendant's alleged unlawful action in the context of a transaction between the plaintiff and the defendant. As originally introduced in the legislature, the

language of § 1770 proscribed "unfair methods of competition and unfair or deceptive practices undertaken by any person in the conduct of any trade or commerce . . . ." Assembly Bill 292, An

United States District Court

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For the Northern District of California

12 13 14 15 16 17 18 19 practices of a seller in a transaction with a buyer. 20 21 22 23 24 25 26 the sale or lease of goods or services to any consumer." 27 28 17 However, before the bill was passed, the legislature also inserted another phrase: "a transaction intended to result or which results in." Thus, the legislature expanded the range of Regular Session (Cal. Jan. 21, 1970) (emphasis added).

amended version of the bill replaced "conduct of any trade or commerce" with "sale or lease of goods to any consumer." Amended Assembly Bill 292, Regular Session (Cal. May 22, 1970). Defendant argues that this change demonstrates that the legislature intended to restrict the CLRA's ambit to unlawful

illegal acts and practices to include those "undertaken by any person in a transaction intended to result or which results in

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Nothing in the language of the CLRA states that only a defendant who directly engaged in a completed transaction with a plaintiff may be liable to that plaintiff. Viewed in light of the

provision to construe the statute liberally, the broad language 5 6 7 8 9 10 of the statute suggests that the legislature intended the CLRA to cover a wide range of business activities. In support of its argument, Defendant relies on Vess, 2001 WL 290333 at *2, and Boyd v. Keyboard Network Magazine, 2000 WL 274204 at *3 (N.D. Cal.), aff'd, 246 F.3d 672 (9th Cir. 2000). In Vess, the CLRA claim against the non-profit organizations was
For the Northern District of California

United States District Court

11 12 13 14 15 16 17 18 19 or services to the plaintiff. 20 21 22 23 24 25 26 it intends to and does sell to consumers. 27 28 18 Plaintiffs' complaint The present case is distinguishable from Vess and Boyd. Neither the non-profit organizations in Vess nor the publisher in Boyd manufactured goods for sale, provided services, or intended to sell goods or provide services to any consumers. In Id. dismissed partly because they were not engaged in any business transactions with the plaintiff. In Boyd, the plaintiff, who

was wronged by a company that made a false advertisement, sued the publisher of that advertisement. 2000 WL 274204 at *3. The

court dismissed the CLRA claim for failing to allege a transaction because the publisher never intended to sell goods

contrast, here Defendant is a manufacturer of automobiles which

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alleges that they bought a 1996, a 1997, and a 1998 model of the Subject Automobiles, that Defendant knew of the defective intake manifolds "no later than January 1, 1997, and possibly earlier," and that Defendant, "through its own efforts and through its

5 6 7 8 9 10 network of authorized dealerships acting as its agents," "warranted, advertised, distributed, and sold its automobiles throughout the state of California." 14, 16. Compl. at ¶¶ 4, 12, 13,

Therefore, Defendant allegedly knew of and concealed

the defects in its Subject Automobiles at the time it engaged in transactions that were "intended to result or which results in

United States District Court

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For the Northern District of California

12 13 14 15 16 17 18 19 product defects from Plaintiffs constitutes a transaction 20 21 22 23 24 25 26 dismissed. 27 28 19 Plaintiffs contend that they properly requested actionable under the CLRA and the complaint cannot be dismissed on this ground. E. Restitution the sale or lease of goods or services to any consumer." Civ. Code § 1770(a). Cal.

Among the sales of goods to consumers,

that resulted from the transactions in which Defendant engaged, were the subsequent resales of Subject Automobiles to Plaintiffs. For these reasons, Defendant's alleged concealment of

Defendant argues that because Plaintiffs are not entitled to restitution or damages under the UCL, that claim should be

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restitution under the UCL. In Kraus v. Trinity Mgmt. Servs., the court found that the California Legislature has not expressly authorized monetary relief other than restitution in UCL actions. 23 Cal. 4th 116,

5 6 7 8 9 10 138 (2000). The court defined an order for restitution as one

"compelling a UCL defendant to return money obtained through unfair busine