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Great West Casualty Co. v. Volvo Trucks North America

October 20, 2010

GREAT WEST CASUALTY COMPANY, AS SUBROGEE OF CHICAGO LOGISTICS, LLC PLAINTIFF,
v.
VOLVO TRUCKS NORTH AMERICA, INC. DEFENDANT.



The opinion of the court was delivered by: Judge Joan H. Lefkow

OPINION AND ORDER

Volvo Trucks North America, Inc. ("Volvo") moves to dismiss Count IV of the first amended complaint filed by Great West Casualty Company ("Great West"), a subrogee of Chicago Logistics, LLC ("Chicago Logistics").*fn1 Great West's first amended complaint asserts claims for strict products liability (Count I), negligence (Count II), breach of written (express) warranty (Count III), and failure to warn (Count IV). Volvo moves to dismiss Count IV pursuant to Federal Rule of Civil Procedure 12(b)(6) on the basis that (1) Volvo does not have adequate notice of the claims against it because Count IV, which asserts that Volvo violated federal statutes and regulations requiring safety notifications, does not cite specific statutes or regulations; and (2) Great West's common law failure to warn claim is preempted by the vehicle defect notification provisions in the National Traffic and Motor Vehicle Safety Act. For the following reasons, Volvo's motion to dismiss [85] will be denied.

BACKGROUND

The following facts are taken from the first amended complaint and are presumed true for the purpose of resolving the pending motion. On or about December 28, 2005, Chicago Logistics purchased a new Volvo truck chassis from an authorized Volvo dealer. Approximately one month later, in January 2006, Volvo issued an order to stop shipments of the type of truck that Chicago Logistics had purchased because of a defect in the engine that could lead to fires.*fn2

Chicago Logistics continued to operate the truck until November 6, 2006, when the engine suddenly caught fire on I-55 in Stickney, Illinois. The fire, which substantially destroyed the truck, was caused in part by the defect in the truck's engine.

In Count IV of its first amended complaint, Great West alleges that, as of the date when Chicago Logistics purchased the truck, Volvo knew or should have known of the truck's engine defects and that Volvo was negligent in failing to warn Chicago Logistics and/or its authorized dealer of the defects. Great West also asserts that Volvo violated unspecified federal statutes and regulations that require prompt notice of safety defects. Great West alleges that Volvo is strictly liable for its failure to warn of the defects. In addition, had Volvo acted on the available information in a timely manner, it would have issued a stop shipment order before Chicago Logistics received the truck.

LEGAL STANDARD

A motion to dismiss under Rule 12(b)(6) challenges a complaint for failure to state a claim upon which relief may be granted. See Fed. R. Civ. P. 12(b)(6); Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1080 (7th Cir. 1997). In ruling on a 12(b)(6) motion, the court accepts as true all well-pleaded facts in the plaintiff's complaint and draws all reasonable inferences from those facts in the plaintiff's favor. Dixon v. Page, 291 F.3d 485, 486 (7th Cir. 2002). In order to survive a Rule 12(b)(6) motion, the complaint must not only provide the defendant with fair notice of the claim's basis, but must also establish that the requested relief is plausible on its face. Ashcroft v. Iqbal, --- U.S. ----, 129 S.Ct. 1937, 1949, 173 L.Ed. 2d 868 (2009); see also Bell Atl. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed. 2d 929 (2007). At the same time, the plaintiff need not plead legal theories. Hatmaker v. Mem'l Med. Ctr., --- F.3d ----, 2010 WL 3385191, at *1 (7th Cir. Aug. 30, 2010). Rather, it is the facts that count.

DISCUSSION

I. Whether Count IV Gives Volvo Adequate Notice of the Claims Against It

Citing Twombly and Iqbal, Volvo first argues that Count IV should be dismissed to the extent that it alleges violations of state and federal statutes and regulations because it does not state which federal statutes or regulations Volvo violated or how the alleged violations occurred. Volvo's argument is not supported by the case law in this district. As the Seventh Circuit recently reiterated, "[a]lthough [Twombly and Iqbal] require that a complaint in federal court allege facts sufficient to show that the case is plausible . . . they do not undermine the principle that plaintiffs in federal courts are not required to plead legal theories. . . . Even citing the wrong statute needn't be a fatal mistake, provided the error is corrected in response to the defendant's motion for summary judgment and the defendant is not harmed by the delay in correction." Hatmaker, 2010 WL 3385191, at *1 (citing Aaron v. Mahl, 550 F.3d 659, 665-66 (7th Cir. 2008); O'Grady v. Vill. of Libertyville, 304 F.3d 719, 723 (7th Cir. 2002); Ryan v. Ill. Dep't of Children & Family Servs., 185 F.3d 751, 764 (7th Cir. 1999)).

Here, Great West alleges that Chicago Logistics purchased a defective truck from Volvo and that Volvo knew this truck was defective at the time the truck left its control. Great West alleges that Volvo knew that the truck was defective because it had received several fire-related liability claims and warranty claims since August 2003. Based on its knowledge of the truck's defect, Volvo should have warned Chicago Logistics and/or its dealer that the truck contained defects and was in an unreasonably dangerous condition. These facts are more than sufficient to put Volvo on notice of Great West's claim. Even though the first amended complaint references Volvo's alleged violations of federal statutes and regulations as part of its failure to warn claim, the complaint need not specify which federal statutes and regulations Volvo violated. See, e.g., Aaron, 550 F.3d at 666 n.7 (a plaintiff does not need to plead the elements of his claim, only factual allegations that are "enough to raise a right to relief above the speculative level" (quoting Twombly, 550 U.S. at 555)); Hall v. Nalco Co., 534 F.3d 644, 649 n.3 (7th Cir. 2008) ("'[A] complaint need not identify a legal theory, and specifying an incorrect theory is not fatal' to a plaintiff's claim." (quoting Bartholet v. Reishauer A.G. (Zürich), 953 F.2d 1073, 1078 (7th Cir. 1992)). Count IV of Great West's complaint will not be dismissed for failure to provide Volvo with notice of the nature of Great West's claim.

II. Whether Count IV Is Preempted by the National Traffic and Motor Vehicle Safety Act

Volvo next argues that Great West's common law claim for failure to warn should be dismissed because it is preempted by the defect notification and vehicle recall procedures in the National Traffic and ...


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