Arthur M Rodriguez et al vs General Motors LLC

Case Number

25CV01572

Case Type

Hearing Date / Time

Mon, 02/09/2026 - 10:00

Nature of Proceedings

Demurrer

Tentative Ruling

Rodriguez, et al. v. General Motors, LLC                         

Case No. 25CV01572

           

Hearing Date: February 9, 2026                                                        

HEARING:              Defendant’s Demurer to First Amended Complaint

ATTORNEYS:        For Plaintiffs Authur M. Rodriguez and Cesar Diaz: Tionna Carvalho, Brian C. Tan, Strategic Legal Practices, APC

                                    For Defendant General Motors, LLC:  Michael D. Mortenson,

                                                Craig A. Taggart, Kristen J. Allison, Mortenson Taggart Adams LLP

TENTATIVE RULING:  Defendant’s demurrer is overruled. Defendant shall file a responsive pleading on or before February 25, 2026.

Background:

This case involves the purchase of a vehicle, a related warranty, and alleged violations of the Song-Beverly Consumer Warranty Act.

On March 13, 2025, plaintiffs Author M. Rodriguez and Cesar Diaz (collectively, Plaintiffs) filed a complaint against defendant General Motors, LLC (Defendant) alleging five causes of action for (1) violation of Civil Code section 1793.2, subdivision (d), (2) violation of Civil Code section 1793.2, subdivision (b), (3) violation of Civil Code section 1793.2, subdivision (a)(3), (4) breach of the implied warranty of merchantability, and (5) fraudulent inducement – concealment.

On September 22, 2025, Plaintiffs filed a first amended complaint (FAC), alleging the same five causes of action.

As alleged in the operative FAC:

On April 4, 2022, Plaintiffs entered into a warranty contract with Defendant regarding a 2022 Buick Encore (Vehicle). (FAC, ¶ 6.) The Vehicle was manufactured and distributed by Defendant. (Ibid.) The Vehicle was purchased in Oxnard from Defendant’s authorized dealer. (Ibid.)

Defects and nonconformities to warranty manifested themselves within the

applicable express warranty period, including engine defects, transmission defects, and electrical defects. (FAC, ¶ 11.)

Defendant failed to promptly replace the Vehicle or promptly make restitution. (FAC, ¶ 15.)

Defendant knew of the defects but concealed them from Plaintiffs, inducing Plaintiffs into purchasing the Vehicle. (FAC, ¶¶ 45-74.)  

Plaintiffs were damaged and seek recission, monetary damages, restitution, statutory penalties, attorney fees, and other relief. (FAC, p. 12, ll. 10-21.)

On October 24, 2025, Defendant filed a demurer to the fifth cause of action for fraudulent inducement – concealment. Defendant argues that the FAC fails to allege a sufficient relationship between Defendant and Plaintiffs to support a concealment cause of action and that this claim is barred by the economic loss rule. This motion is opposed.

Analysis:

“Because the function of a demurrer is to test the sufficiency of a pleading as a matter of law, we … assume the truth of the allegations in the complaint, but do not assume the truth of contentions, deductions, or conclusions of law. [Citation.] It is error for the trial court to sustain a demurrer if the plaintiff has stated a cause of action under any possible legal theory, and it is an abuse of discretion for the court to sustain a demurrer without leave to amend if the plaintiff has shown there is a reasonable possibility a defect can be cured by amendment.” (California Logistics, Inc. v. State of California (2008) 161 Cal.App.4th 242, 247.) “The reviewing court gives the complaint a reasonable interpretation, and treats the demurrer as admitting all material facts properly pleaded.” (Payne v. National Collection Systems, Inc. (2001) 91 Cal.App.4th 1037, 1043.) “[I]n ruling on a demurrer the trial court may take into account in addition to the complaint itself any matter that may be properly considered under the doctrine of judicial notice.” (Cruz v. County of Los Angeles (1985) 173 Cal.App.3d 1131, 1133-1134.)

“[T]he elements of an action for fraud and deceit based on concealment are: (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” (SCC Acquisitions Inc. v. Central Pacific Bank (2012) 207 Cal.App.4th 859, 864.)

“There are ‘four circumstances in which nondisclosure or concealment may constitute actionable fraud: (1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material facts. [Citation.]’ ” (LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336.) Aside from a fiduciary relationship, “[e]ach of the other three circumstances in which nondisclosure may be actionable presupposes the existence of some other relationship between the plaintiff and defendant in which a duty to disclose can arise.” (Id. at p. 336-337.)

In the context of consumer allegations that a car manufacturer concealed known defects, a cause of action for fraudulent concealment/inducement is sufficiently alleged against the manufacturer where: “vehicles (including the one plaintiffs purchased) were defective; [manufacturer] knew of the defects and the hazards they posed; [manufacturer] had exclusive knowledge of the defects but intentionally concealed and failed to disclose that information; [manufacturer] intended to deceive plaintiffs by concealing known [defects]; plaintiffs would not have purchased the car if they had known of the defects; and plaintiffs suffered damages in the form of money paid to purchase the car.” (Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 844 (Dhital).)

The FAC alleges that the Vehicle was among the make and model suffering from defects. (FAC, ¶¶ 11-13, 24, 35, 43, 46-53.) Defendant knew of the defects and hazards they posed (FAC, ¶¶ 51-57.) Defendant had exclusive knowledge of the defects but intentionally concealed that information from Plaintiffs who were unaware of the defects. (FAC, ¶¶ 51-56, 65, 66.) Defendant actively concealed the defects from Plaintiffs at the time of purchase. (FAC, ¶¶ 51, 53.) Plaintiffs would not have purchased the Vehicle had they known about the defects. (FAC, ¶¶ 54, 60.) Plaintiffs suffered damages based on the money paid for the vehicle and other damages. (FAC, ¶¶ 28, 34, 38, 55, 74.) The elements of concealment/inducement in this context have been alleged. (See Dhital, supra, Cal.App.5th at p. 844.)

Defendant argues that Plaintiffs have not alleged a sufficient relationship with Defendant to support a claim for concealment/inducement. However, the FAC alleges that Defendant manufactured and distributed the Vehicle, and that Plaintiffs purchased the Vehicle from Defendant’s authorized agent. (FAC, ¶ 6.) The FAC alleges that “Defendant … and its agents have actively concealed the Engine Defect and failed to disclose this defect to Plaintiffs at the time of purchase of the … Vehicle or thereafter,” and “[a]s a result of Plaintiffs’ reliance on [Defendant] and its agent’s omissions and/or concealment of the Engine Defect, Plaintiffs suffered an ascertainable loss.” (FAC, ¶¶ 51, 55.) These allegations are sufficient at the pleading stage to establish a relationship between Plaintiffs and Defendant for purposes of the concealment claim. (See Dhital, supra, 84 Cal.App.5th at p. 844.)

As to Defendant’s economic loss rule argument, as noted in Dhital, “the fraudulent inducement exception to the economic loss rule applies. Plaintiffs allege that [manufacturer], by intentionally concealing facts about the [defects], fraudulently induced them to purchase a car. Fraudulent inducement is a viable tort claim under California law.” (Dhital, supra, 84 Cal.App.5th at p. 838.) “To hold, at the demurrer stage, that plaintiffs’ fraud claim is barred by the economic loss rule, we would need to conclude, as [manufacturer] urges us to do, that … there is no exception to the economic loss rule for fraudulent inducement claims … or … plaintiffs have not adequately pleaded a claim for fraudulent inducement under California law …. We reject both arguments and conclude the economic loss rule does not bar plaintiffs’ claim.” (Dhital, 84 Cal.App.5th at p. 839.)

The cases cited by Defendant, Bjoin v. J-M Manufacturing Co., Inc. (2025) 113 Cal.App.5th 884 (Bjoin), and Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1 (Rattagan), are distinguishable or do not compel the result sought by Defendant. Bjoin involved a case brought by a laborer against the manufacture of asbestos cement pipe and an appeal after trial. (Bjoin, supra, 113 Cal.App.5th at pp. 888-891.) As noted in Bjoin, “[a] duty to disclose requires “a preexisting relationship between the parties, such as ‘between seller and buyer, employer and prospective employee, doctor and patient, or parties entering into any kind of contractual agreement. [Citation.] All of these relationships are created by transactions between parties from which a duty to disclose facts material to the transaction arises under certain circumstances.’ ” (Id. at p. 903.) Unlike the trial court’s finding in Bjoin, as alleged in the FAC, there was a buyer-seller relationship between Plaintiffs and Defendant. The FAC does not rely upon dealings “between the defendant and the public at large.” (See id.; Dhital, supra, 84 Cal.App.5th at pp. 838-844; FAC, ¶ 6.)

Rattagan involved a case brought by a corporate attorney hired to assist in a ride-share platform in Argentina against the company that contracted with him to perform this work. (Rattagan, supra, 17 Cal.5th at pp. 13-18.) Rattagan held in response to a certified question from United States Court of Appeals for the Ninth Circuit that, “[a] plaintiff may assert a fraudulent concealment cause of action based on conduct occurring in the course of a contractual relationship if the elements of the claim can be established independently of the parties’ contractual rights and obligations, and the tortious conduct exposes the plaintiff to a risk of harm beyond the reasonable contemplation of the parties when they entered into the contract.” (Id. at p. 38.) “The guiding and distinguishing principle is this. If the alleged breach is based on a failure to perform as the contract provides, and the parties reasonably anticipated and allocated the risks associated with the breach, the cause of action will generally sound only in contract because a breach deprives an injured party of a benefit it bargained for. However, if the contract reveals the consequences were not reasonably contemplated when the contract was entered and the duty to avoid causing such a harm has an independent statutory or public policy basis, exclusive of the contract, tort liability may lie.” (Id. at p. 27.)

Here, the concealment/inducement cause of action is based on conduct that occurred before the contract was completed that induced Plaintiffs to enter into this contract. (FAC, ¶¶ 51-66.) Plaintiffs did not reasonably contemplate that Defendant or its agents were selling them a car with known defects, rendering the Vehicle worthless. (See FAC, ¶ 13.) The injury resulting from the alleged fraud is not the failure to repair the Vehicle under the warranty. Rather, the alleged injury is that Plaintiffs would not have purchased the Vehicle or entered into the warranty contract had Plaintiffs known they were being defrauded. (FAC, ¶¶ 54, 60.) This alleged harm is independent of Defendant’s contractual obligations under these circumstances. (See Dhital, supra, 84 Cal.App.5th at pp. 838-844.)

For all these reasons, the court will overrule the demurer.