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Gustafson v. Goodman Manufacturing Co. L.P.

United States District Court, D. Arizona

April 28, 2014

JAMES GUSTAFSON, on behalf of himself and all other persons similarly situated, Plaintiff,


H. RUSSEL HOLLAND, District Judge.

Motion to Dismiss

Defendants move to dismiss plaintiff's complaint.[1] This motion is opposed.[2] Oral argument was requested but is not deemed necessary.


Plaintiff is James Gustafson. Defendants are Goodman Manufacturing Company, L.P. and Goodman Global, Inc.

Plaintiff alleges that "[i]n or around 2010, [he] purchased a remodeled home" and that "[s]oon thereafter, [he] purchased two Goodman Products for the purpose of cooling and heating his home" from Carey's Air Conditioning, Heating & Plumbing.[3] Plaintiff alleges that he paid "approximately $16, 000" for the two Goodman Products.[4] Plaintiff's Goodman Products came with a "Limited Warranty" which provides that "[t]his heating or air conditioning unit is warranted by Goodman Manufacturing Company... to be free from defects in materials and workmanship that affect performance under normal use and maintenance[.]"[5] The Limited Warranty further provides that "Goodman will furnish a replacement part, without charge for the part only, to replace any part that is found to be defective due to workmanship or materials under normal use and maintenance."[6] The Limited Warranty does "not apply to labor, freight, or any other cost associated with the service, repair or operation of the unit."[7] The Limited Warranty applies for ten years if the owner registers his unit, but only applies for five years if the owner does not register his unit.[8] Plaintiff has not alleged that he registered his unit, but plaintiff does allege that he purchased "an Extended 10-Year Warranty covering parts and labor for the two Goodman Products."[9]

Plaintiff alleges that after he purchased the two Goodman Products, "[o]ver the next 24 months, [his] Goodman Products regularly failed to emit cool air and, therefore, failed to cool his house."[10] Plaintiff alleges that he contacted Carey's "no fewer than 12 separate times to fix his Goodman Products...."[11] Plaintiff alleges that each time, "a technician would come out and repair the Goodman Units, either by replacing leaked Freon in the Goodman Products, repair[ing] or replac[ing] any defective parts, or any other such repair deemed necessary."[12] Plaintiff alleges that because his "Goodman Products were under warranty, Carey's did not charge for labor or the repairs it performed."[13] Plaintiff alleges that in 2013, he "became so frustrated with the failure of his Goodman Products..., he purchased a Bi-Annual Maintenance Agreement... from River Valley Air Conditioning, Inc. for both of his Goodman Products at a total cost of $266.00."[14]

Plaintiff alleges that the leakage of refrigerant in the Goodman Products was caused by defective evaporator coils.[15] He further alleges that "the refrigerant leakage is due to a defect in the design and manufacturing of the Goodman Products that existed from the date of manufacture" and that "[d]efendants knew about the defects in the Goodman Products."[16] Plaintiff alleges that "Goodman provided certain of its distributors a $300 allowance for each Goodman Product they sold because the refrigerant leakage problem was so widespread."[17]

Plaintiff alleges that he was not alone in his frustration with defendants' products. In his complaint, plaintiff includes numerous negative comments about defendants' products that other consumers posted on the internet.[18] Plaintiff also includes comments posted by service technicians who "criticized the poor quality of Goodman products...."[19]

On November 20, 2013, plaintiff commenced this action. Plaintiff brings this action "on behalf of himself and all persons and/or entities in Arizona who purchased air conditioners, air handlers, and heat pumps manufactured by Goodman Manufacturing Co., L.P. under the trade names Goodman® and Amana®... between November 20, 2009 [and] November 20, 2013, [and] who incurred damages as a result of having to repair their Goodman Products due to leakage of refrigerant."[20] In his Class Action Complaint, plaintiffs alleges a breach of express warranty claim and an Arizona Consumer Fraud Act (ACFA) claim.

Pursuant to Rule 12(b)(6), Federal Rules of Civil Procedure, defendants now move to dismiss plaintiff's claims.


"Rule 12(b)(6) authorizes courts to dismiss a complaint for failure to state a claim upon which relief can be granted.'" In re Rigel Pharmaceuticals, Inc. Securities Litig. , 697 F.3d 869, 875 (9th Cir. 2012) (quoting Fed.R.Civ.P. 12(b)(6)). "To avoid dismissal, the complaint must provide more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.'" Id . (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555 (2007)). "[A] plaintiff must allege sufficient factual matter... to state a claim to relief that is plausible on its face.'" OSU Student Alliance v. Ray , 699 F.3d 1053, 1061 (9th Cir. 2012) (quoting Pinnacle Armor, Inc. v. United States , 648 F.3d 708, 721 (9th Cir. 2011)). "In evaluating a Rule 12(b)(6) motion, the court accepts the complaint's well-pleaded factual allegations as true and draws all reasonable inferences in the light most favorable to the plaintiff." Adams v. U.S. Forest Srvc. , 671 F.3d 1138, 1142-43 (9th Cir. 2012).

Defendants first argue that plaintiff has failed to state plausible claims because plaintiff has not alleged that he suffered any damages. Damages are an essential element of both plaintiff's breach of express warranty claim and of his ACFA claim. See Dillon v. Zeneca Corp. , 42 P.3d 598, 602 (Ariz.Ct.App. 2002) (the plaintiffs' breach of express warranty claim based on statement made by sales rep failed because they suffered no loss as a result of the statement); Grand v. Nacchio , ...

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