A warranty plaintiff can’t make a commercial truck (or its auxiliary air conditioner) a “consumer product” simply by calling it one, but he can state an implied warranty claim by alleging that it didn’t work right.
Recently, an insurance company tried to recover payments it made after a fire loss involving a commercial truck under the federal warranty statute – the Magnuson-Moss Act. The law only covers warranties on “consumer products,” that is, those “normally used for personal, family or household purposes.” Plaintiff insurance company asserted that either the truck or its auxiliary air conditioner – the source of the fire –qualified as a “consumer product,” but offered no facts to support the claim. The court summarily rejected the insurance company’s “threadbare recital,” finding that it did not set out a plausible claim for relief under the federal act.
This aspect of the decision demonstrates that the Supreme Court’s fairly recent decisions strengthening federal pleading standards, Twombly and Iqbal, are alive and well and available to weed out specious claims.
The company’s defect allegations under its state law implied warranty claim fared much better. The insurance company alleged that the air conditioner malfunctioned while being used as intended, and that investigators ruled out reasonable secondary causes for the fire using “objective standards of fire investigation.” Finding the allegations sufficient, the court explained that to make out an implied warranty claim, a plaintiff need not allege a specific or particular defect, but can rely on facts showing that the product malfunctioned during normal use in the absence of reasonably likely causes other than a defect.
To read the full case, Liberty Mutual Insurance Company v. Freightliner, LLC, et al., No. 13-5543 (E.D. Pa. Nov. 19, 2013), click here.