Clark Hill Wins for FCA US in Song-Beverly California Supreme Court Case

Georges Haddad, David Brandon, and Brian Hom led a team from Clark Hill that supported FCA US before the California Supreme Court in a significant case relating to the Song-Beverly Act.

In its unanimous Oct. 31 ruling, the Court rejected arguments that had been asserted for nearly 30 years by declaring that “used” cars are not covered by the Song-Beverly Act.

“This is a huge win for all automakers and will eliminate thousands of potential lawsuits,” said Hom. “The ruling also validates the arguments we have been asserting for decades.”

In Rodriguez v. FCA, the plaintiffs purchased in 2013 a 2011 Dodge Ram with 55,000 miles from a used car dealer. The vehicle’s 36,000-mile “bumper-to-bumper” warranty had expired but its 100,000-mile “powertrain” warranty was still in effect. The plaintiffs claimed that the car repeatedly experienced engine problems despite numerous repair attempts by defendant FCA, which FCA disputed.

In 2018, the plaintiffs sued FCA, seeking to enforce the “refund-or-replace” provision by claiming their car was “new” because it was a “motor vehicle sold with a manufacturer’s new car warranty.”

Haddad and Clark Hill attorneys Michael Tcheng and Michael Sachs represented FCA in the trial court and successfully obtained a summary judgment, with the trial court ruling that the Song-Beverly Act only covered “new” motor vehicles, including motor vehicles sold as new with full warranties, but not used vehicles even if they came with balances on their warranties.

On appeal and before the Supreme Court, Brandon, Haddad, and Hom continued to support FCA US and appellate counsel Horvitz & Levy, led by Shane McKenzie, Lisa Perrochet, and John Taylor, who successfully argued that the plaintiff’s vehicle was not eligible for Song-Beverly protection because it was not sold as a new vehicle and was merely a used vehicle with an unexpired warranty.

Prior to the Supreme Court’s ruling, a unanimous Court of Appeal had affirmed the trial court’s grant of summary judgment to FCA US by declaring that a key phrase of the Song-Beverly Act, “other motor vehicle sold with a manufacturer’s new car warranty,” does not include the sale of “previously owned vehicles with some balance remaining on the manufacturer’s express warranty.”

“After six years, it is very satisfying to receive a unanimous ruling on a key issue in the automotive industry,” said Brandon. “Our team is thrilled for FCA and we are proud to have helped make a significant impact in how these cases will be decided in the future.”