Stephens v. Ford Motor Company

Discussion Qualitas states that SCOC "is not participating in its defense and is furthermore a suspended corporation according to the California Secretary of State. Qualitas ... as its insurer, has a direct and immediate interest in this litigation." (Motion, pp. 3, 5, Lawrence Decl., P.P. 2, 4.)

Further, "[d]espite repeated attempts by Stone Kalfus LLP [, the insurance-appointed counsel for SCOC,] to facilitate curing the corporate suspension and obtain a certificate of revivor for SCOC, no such cure or certificate of revivor could be obtained." (Motion, p. 3, Lawrence Decl., P. 3.)

Finally, Qualitas states that "[t]he corporate suspension of SCOC prevents Qualitas from mounting a proper defense of SCOC against Plaintiff's suit, which exposes SCOC and Qualitas to a default or other judgment, pursuant to Insurance Code Sec. 11580. Accordingly, Qualitas has a direct and immediate interest in this litigation because it could be required to satisfy a judgment entered against SCOC as its insured. Moreover, adding Qualitas as an intervenor will not enlarge the issues in the case, as it seeks only to step into the shoes of its insured, SCOC." (Motion, Lawrence Decl., pp. 3-4.)

Here, Qualitas has an interest in the outcome of this action because it insures SCOC and will face direct liability if it is not permitted to intervene. (See Reliance Ins. Code v. Superior Court (2000) 84 Cal.App.4th 383, 386 ["An insurer's right to intervene in an action against the insured, for personal injury or property damage, arises as a result of Insurance Code section 11580. Section 11580 provides that a judgment creditor may proceed directly against any liability insurance covering the defendant, and obtain satisfaction of judgment up to the amount of the policy limits"].)

Qualitas represents that SCOC is a suspended entity who is not defending this action, which thus necessitated the instant Motion, and such circumstances are permissible grounds on which to grant a motion to intervene. (See id., at p. 387.)

Finally, the Motion is timely as default judgment has not yet been entered against SCOC. (See id., at pp. 386-387 ["[W]here the insurer may be subject to a direct action under Insurance Code section 11580 by a judgment creditor who has or will obtain a default judgment in a third party action against the insured, intervention is appropriate"].)

Furthermore, the Motion includes a proposed answer in intervention. (See Motion, Lawrence Decl., Exh. A.)

Finally, the Court notes that Plaintiff does not oppose Qualitas' intervention. (See Notice of Non-Opp.)

Accordingly, the unopposed Motion is GRANTED.

IV. Conclusion & Order

For the foregoing reasons, Non-Party Qualitas Insurance Company's unopposed Motion for Leave to Intervene and to File an Answer-In-Intervention is GRANTED. Moving party is ordered to give notice.

31, 2026 JUDGE /DEPT: Mkrtchyan/512

CASE NAME: Stephens v. Ford Motor Company COMP. FILED: 03-20-26 CASE NUMBER: 26STCV09116 FAC FILED: 04-21-26 NOTICE: OK PROCEEDINGS: DEMURRER AND MOTION TO STRIKE MOVING PARTY: Defendant Ford Motor Company RESP. PARTY: Plaintiff Jacqueline Stephens DEMURRER WITH MOTION TO STRIKE (CCP Sec.Sec. 430.10, et seq.; 435; 436) TENTATIVE RULING: Defendant Ford Motor Company's Demurrer is OVERRULED and Motion to Strike is DENIED. Moving party is ordered to give notice. SERVICE: [X] Proof of Service Timely Filed (CRC, rule 3.1300) OK [X] Correct Address (CCP Sec.Sec. 1013, 1013a) OK [X] 16/21 Court Days Lapsed (CCP Sec.Sec. 12c, 1005(b)) OK OPPOSITION: Filed on June 26, 2026 [] Late [] None REPLY: Filed on July 23, 2026 [] Late [] None ANALYSIS: I.

Background

On March 20, 2026, Plaintiff Jacqueline Stephens ("Plaintiff") filed the instant action against Defendant Ford Motor Company ("Defendant") and Does 1-20, alleging causes of action for Breach of Implied Warranty of Merchantability under the Song Beverly Act; Breach of Express Warranty under The Song-Beverly Act; Fraudulent Concealment; and Violation of Civil Code Section 1750, et seq. (Compl., p. 1.)

On April 21, 2026, Plaintiff filed a First Amended Complaint ("FAC") against Defendant and Does 1-20, alleging causes of action for Breach of Implied Warranty of Merchantability under the Song Beverly Act; Breach of Express Warranty under The Song-Beverly Act; Fraudulent Concealment; and Violation of Civil Code Section 1750, et seq.

On May 26, 2026, Defendant filed the instant Motion to Strike Portions of Plaintiff's FAC (the "Motion").

On June 26, 2026, Plaintiff filed an Opposition to a Demurrer and an Opposition to the Motion.

On June 30, 2026, the Court continued the hearing on "Demurrer - with Motion to Strike." (6/30/26 Order.) That same day, Plaintiff filed and served notice of ruling.

On July 23, 2026, Defendant filed a Reply to a Demurrer and a Reply to the Motion.

On July 30, 2026, the Court continued the hearing on the Demurrer and Motion to allow Defendant to file the Demurrer with the Court. (7/30/26 Order.) That same day, Defendant filed and served a Demurrer to Plaintiff's FAC (the "Demurrer") and notice of the Court's ruling.

II. Procedural Issues

The Court finds previous procedural issues are now remedied.

III. Legal Standard

"As a general matter, in a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.)

"A demurrer tests the pleading alone, and not the evidence or facts alleged." (E-Fab, Inc. v. Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.)

As such, the court assumes the truth of the complaint's properly pleaded or implied factual allegations. (Ibid.)

The only issue a demurrer is concerned with is whether the complaint, as it stands, states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.)

A general demurrer may be brought under Code of Civil Procedure section 430.10, subdivision (e) if insufficient facts are stated to support the cause of action asserted or under section 430.10, subdivision (a), where the court has no jurisdiction of the subject of the cause of action alleged in the pleading.

All other grounds listed in Section 430.10, including uncertainty under subdivision (f), are special demurrers.

Where a demurrer is sustained, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.)

The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Id.; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.)

However, "[i]f there is any reasonable possibility that the plaintiff can state a good cause of action, it is error to sustain a demurrer without leave to amend." (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240, 245).

IV.

Discussion

A. Meet and Confer

Code of Civil Procedure section 430.41 requires that "[b]efore filing a demurrer pursuant to this chapter, the demurring party shall meet and confer in person, by telephone, or by video conference with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer." (Code Civ. Proc., Sec. 430.41, subd. (a).)

The parties are to meet and confer at least five days before the date the responsive pleading is due. (Code Civ. Proc., Sec. 430.41, subd. (a)(2).)

Thereafter, the demurring party shall file and serve a declaration detailing their meet and confer efforts. (Code Civ. Proc., Sec. 430.41, subd. (a)(3).)

Here, Defendant filed a declaration attesting that Defendant sent Plaintiff a meet and confer letter and received no substantive response. (Demurrer, Cabibi Decl., Exh. A)

The Court does not find a single letter satisfies the statutory mandate to meet and confer by telephone or in person.

While the Court may not overrule a Demurrer for failing to properly meet and confer (Code Civ. Proc., Sec. 430.41(a)(4)), the Court cautions the parties to abide by their statutory obligations in the future.

B. Demurrer Miscellaneous Contentions

As an initial matter, the Court notes that Defendant raises a new argument in the Reply brief that was not included in the Demurrer - namely, that Plaintiff's FAC is improperly based entirely on information and belief. (Reply, p. 2.)

The Court declines to address this argument as it was not raised in the moving papers, and thus Plaintiff has not been afforded and opportunity to respond.

Causes of Action Nos. 1-2 - Breach of Implied Warranty of Merchantability

Defendant demurs to the first and second causes of action on the grounds that the FAC fails to state sufficient facts to constitute these causes of action.

Namely, the FAC does not state that Plaintiff purchased a new vehicle, and thus the Song-Beverly Act does not apply to Plaintiff. (Demurrer, pp. 7-8.)

Further, Defendant contends the first and second cause of action are barred by the six-year statute of repose. (Demurrer, pp. 8-9.)

Finally, Defendant states that the parties were not in privity when Plaintiff purchased the subject vehicle. (Demurrer, pp. 8-9.)

In Opposition, Plaintiffs contends the FAC pleads the subject vehicle is a new vehicle; the statute of repose does not bar the instant action; and the first and second causes of action are adequately pled. (See Opp., pp. 2-6.)

In Reply, Defendant does not raise any arguments addressing the first and second causes of action.

Here, the Court finds the FAC pleads the subject vehicle "was/is a 'new motor vehicle' " that came with a " 'New Vehicle Limited Warranty.' " (FAC, P.P. 7, 9.)

Further, the FAC pleads Plaintiff purchased the subject vehicle from a certified retailer of Ford. (FAC, P.P. 5-7.)

The Song-Beverly Act "applies to new motor vehicle manufacturers who make express warranties' ... there is 'no privity requirement.' " (Davis v. Nissan North America, Inc. (2024) 100 Cal.App.5th 825, 842.)

Finally, the FAC alleges that Plaintiff purchased the subject vehicle on July 25, 2020, which is within the six-year statute of repose. (FAC, P.P. 5, 7; see Mexia v. Rinker Boat Co., Inc. (2009) 174 Cal.App.4th 1297, 1311; Code Civ. Proc., Sec. 871.21, subd. (b).)

For all these reasons, the Court finds Defendant's arguments as to the first and second causes of action are meritless.

Moreover, the Court notes the Reply does not address these causes of action, thus appearing to concede the Demurrer's challenges to the FAC on the above grounds are meritless.

Accordingly, the Demurrer is OVERRULED as to the first and second causes of action.

Cause of Action No. 3 - Fraudulent Inducement (Concealment)

Defendant demurs to the third cause of action on the grounds the FAC fails to plead this cause of action with sufficient particularity. (Demurrer, pp. 10-16.)

Further, Defendant contends the fraud cause of action is barred by the Economic Loss Rule. (Demurrer, p. 4.)

In Opposition, Plaintiff contends the FAC sufficiently pleads the elements for the third cause of action. (See Opp., pp. 7-15.)

Further, if the Court is inclined to sustain any part of the Demurrer, Plaintiff requests leave to amend the FAC. (Opp., pp. 15-16.)

In Reply, Defendant reiterates arguments raised in the Demurrer. (Reply, pp. 3-6.)

Further, Defendant requests the Court deny Plaintiff leave to amend. (Reply, p. 7.)

"Fraudulent inducement is a viable tort claim under California law. 'The elements of fraud are (a) a misrepresentation (false representation, concealment, or nondisclosure); (b) scienter or knowledge of its falsity; (c) intent to induce reliance; (d) justifiable reliance; and (e) resulting damage. Fraud in the inducement is a subset of the tort of fraud. It 'occurs when "'the promisor knows what he is signing but his consent is induced by fraud, mutual assent is present and a contract is formed, which, by reason of the fraud, is voidable.' " (Dhital v.

Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 838-839, internal citations omitted; see also Anderson v. Ford Motor Co. (2022) 74 Cal.App.5th 946, 971 ["plaintiffs are not prohibited from receiving both an award for punitive damages based on presale fraudulent inducement and a postsale Song-Beverly Act penalty based on willful noncompliance because they argued pattern and practice in the trial court"].)

A cause of action for fraud must be " 'pled specifically; general and conclusory allegations do not suffice. ... " 'This particularity requirement necessitates pleading facts which " 'show how, when, where, to whom, and by what means the representations were tendered.' " ' " (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184, citing Lazar, supra, 12 Cal.4th at p. 645.)

"[U]nder California law, the economic loss rule does not bar [a] fraudulent inducement claim." (Id., at p. 833.)

Here, the FAC pleads that Defendants had superior and exclusive knowledge of the defective engine from consumer complaints; information provided to authorized dealers via Technica Service Bulletins and Special Service messages; information received directly from Defendants' authorized dealers; NHTSA complaints; Defendants' own records, including durability testing and failure rates; and requests from Defendants' authorized dealerships for technical assistance regarding the defective engine; and warranty costs outlaid due to defective engines. (See FAC, P.P. 20, 63-67, 112.)

Further, the FAC pleads that Defendants intentionally misrepresented and concealed the defective engine by "propagating the falsehood that the noises, hesitation, misfires, and oil leakage are 'normal' " since as early as 2012. (FAC, P.P. 68-69.)

Defendants made multiple false promises and assurances to consumers through Defendants' national, multimedia marketing campaign and advertisements, and Plaintiff purchased the subject vehicle based on such marketing materials and recommendations of the dealer salespersons assisting Plaintiff. (See FAC, P.P. 69-72.)

The FAC pleads that Defendants and their authorized dealership staff never publicly or privately disclosed to Plaintiff "any information about the persistent and dangerous concerns that plagued the Defective Engine, including the Vehicle. Defendants failed to disclose to Plaintiff that the Vehicle was equipped with a Defective Engine-not prior to Plaintiff's purchase of the Vehicle, nor during Plaintiffs research, test drive or during the sales process, nor at any point when the Vehicle was presented to Defendants for repair for the very defects that Defendants already knew plague the Defective Engine." (FAC, P.P. 72, 116.)

These omissions "were material to Plaintiff's decision to buy the vehicle;" Plaintiff "is a reasonable consumer who reasonably expected the Vehicle would not be equipped with the Defective Engine;" and Plaintiff would not have purchased the subject vehicle had Plaintiff known of the misrepresented and concealed defective engine. (FAC, P.P. 72-74, 114, 117.)

As a result of Defendants' concealment, Plaintiff has suffered damages in that the "Vehicle has diminished, including, without limitation, the resale value of the Vehicle." (FAC, P.P. 76 118-119.)

Accordingly, the Court finds that the FAC states sufficient facts to plead a Fraudulent Concealment cause of action that is not barred by the Economic Loss Rule.

To the extent Defendant contests the veracity or merit of the facts alleged in the FAC, the Court reminds Defendant that "[a] demurrer tests the pleading alone, and not the evidence or facts alleged." (E-Fab, Inc., supra, 153 Cal.App.4th at p. 1315.)

Thus, the Demurrer is OVERRULED as to the third cause of action.

Fourth Cause of Action - California Consumers Legal Remedies Act ("CLRA")

Defendant demurs to the fourth cause of action on the grounds the FAC fails to plead this cause of action with sufficient particularity. (Demurrer, pp. 10-16.)

In Opposition, Plaintiff contends the FAC sufficiently pleads the elements for this cause of action. (See Opp., pp. 7-15.)

Further, if the Court is inclined to sustain any part of the Demurrer, Plaintiff requests leave to amend the FAC. (Opp., pp. 15-16.)

In Reply, Defendant reiterates arguments raised in the Demurrer. (Reply, pp. 3-6.)

Further, Defendant requests the Court deny Plaintiff leave to amend. (Reply, p. 7.)

To plead a claim under the CLRA, a plaintiff must adequately plead defendant engaged in unfair methods of competition or unfair or deceptive acts listed in Civil Code, section 1770, in a transaction intended to result or that results in the sale or lease of goods or services to any consumer. (See Civ. Code, Sec.¿1770(a).)

The CLRA states, in pertinent part: "(a) Any consumer who suffers any damage as a result of the use or employment by any person of a method, act, or practice declared to be unlawful by Section 1770 may bring an action against that person to recover or obtain any of the following:(1) Actual damages, ... (2) An order enjoining the methods, acts, or practices. (3) Restitution of property. (4) Punitive damages. (5) Any other relief that the court deems proper." (Civ. Code, 1780, subd. (a).)

Proscribed acts and practices under the CLRA include:¿ (5) Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that they do not have or that a person has a sponsorship, approval, status, affiliation, or connection that the person does not have....¿ (7) Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another.....¿ (9) Advertising goods or services with intent not to sell them as advertised....¿[and/or] (14) Representing that a transaction confers or involves rights, remedies, or obligations that it does not have or involve, or that are prohibited by law. (Civ. Code, Sec.Sec. 1770(a)(5), (7), (9), (16).)¿

A cause of action under the CLRA "must be stated with reasonable particularity, which is a more lenient standard than is applied to common law fraud claims." (Gutierrez v. Carmax Auto Superstores California ¿(2018) 19 Cal.App.5th 1234, 1261.)

In particular, the plaintiff must plead with reasonable particularity the facts supporting the elements of the violation. (See Khoury v. Maly's of California, Inc. ¿(1993) 14 Cal.App.4th 612, 619.)¿

An omission is actionable under the CLRA if the omitted fact is (1) "contrary to a material representation actually made by the defendant" or (2) is a fact the defendant was obliged to disclose. (Gutierrez, supra, 19 Cal.App.5th at 1269.)

"In the context of the CLRA, a fact is 'material' if a reasonable consumer would deem it important in determining how to act in the transaction at issue." (Id. at p. 1258.)¿

Here, as discussed above, Plaintiff has pled a fraudulent concealment claim with requisite particularity.

Plaintiff has pled the CLRA claim with even more specificity, given that the standard for pleading is "more lenient" in CLRA claims than that applied in fraud claims. (See Gutierrez, supra, 19 Cal.App.5th at p. 1261.)

To the extent Defendant relies on Daughtery v. American Honda Motor Co. Inc. (2006) 144 Cal.App.4th 824 to support its contention that the FAC is deficiently pled as to the CLRA claim, the Court finds this case is inapt and factually distinguishable from the instant matter.

In Daughtery, the complaint failed to identify any representation by defendant that its automobiles had any characteristic or are of a standard or quality that they are not, and thus the Second District Court of Appeal found there was no CLRA claim stated. (Id., at pp. 834-836.)

Further, the complaint did not state any factual allegations showing any instance of physical injury or any safety concerns posed by the defect. (Id., at p. 836.)

By contrast, and as discussed above, the FAC in this action identifies specific misrepresentations and concealed qualities or characteristics of the subject vehicle's defective engine that also posed safety concerns.

As such, the Court finds the FAC states sufficient facts to state a CLRA cause of action.

Thus, the Demurrer is OVERRULED as to the fourth cause of action.

Accordingly, the Demurrer is OVERRULED.

C. Motion to Strike

Legal Standard

California law authorizes a party's motion to strike matter from an opposing party's pleading if it is irrelevant, false, or improper. (Code Civ. Proc. Sec.Sec. 435, 436.)

Motions may also target pleadings or parts of pleadings that are not filed or drawn in conformity with applicable laws, rules, or orders. (Code Civ. Proc. Sec. 436, subd. (b).)

The Code of Civil Procedure also authorizes the Court to act on its own initiative to strike matters, empowering the Court to enter orders striking matter "at any time in its discretion, and upon terms it deems proper." (Code Civ. Proc. Sec. 436.)

Finally, Code of Civil Procedure section 435.5 requires that "[b]efore filing a motion to strike pursuant to this chapter, the moving party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to the motion to strike for the purpose of determining whether an agreement can be reached that resolves the objections to be raised in the motion to strike." (Code Civ. Proc. Sec. 435.5, subd. (a).) (Emphasis added.)

Punitive damages are authorized by Civil Code section 3294 in non-contract cases "where the defendant has been guilty of oppression, fraud, or malice, express or implied . . . ." (Civil Code, Sec. 3294, subd. (a).)

Malice means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others. (Civil Code, Sec. 3294, subd. (c)(1).)

Oppression means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person's rights. (Civil Code, Sec. 3294, subd. (c)(2).)

Fraud means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the party of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury. (Civil Code, Sec. 3294, subd. (c)(3).)

Analysis

Defendant moves to strike the FAC's references to and requests for punitive damages; the request for injunctive relief; and irrelevant or immaterial allegations in the FAC. (Motion, pp. 3-4, 5-11.)

As an initial matter, the Court finds Defendant has not satisfied the meet and confer requirement of Code of Civil Procedure section 435.5.

Here, the Court found the FAC states sufficient facts to plead a fraud cause of action.

Punitive damages are available in actions involving fraud and CLRA actions. (Civil Code, Sec. 3294, subd. (a); Anderson, supra, 74 Cal.App.5th at p. 971.)

As to the request for injunctive relief, the Court finds this request is pled in conjunction with the CLRA claim, which allows for injunctive relief, and is thus adequately supported by the FAC.

Indeed, the CLRA states, in pertinent part: "(a) Any consumer who suffers any damage as a result of the use or employment by any person of a method, act, or practice declared to be unlawful by Section 1770 may bring an action against that person to recover or obtain any of the following: (1) Actual damages, ... (2) An order enjoining the methods, acts, or practices. (3) Restitution of property. (4) Punitive damages. (5) Any other relief that the court deems proper." (Civ. Code, 1780, subd. (a), emphasis added.)

To the extent Defendant challenges Plaintiff's ability to plead either combination or alternative theories of relief, the Court finds this contention to be legally unsupported and unpersuasive.

Finally, the Court does not find that paragraphs 39-52 of the FAC are irrelevant, immaterial, and/or superfluous as Defendant suggests. (Motion, pp. 5-6.)

Rather, the Court finds these paragraphs are relevant to Plaintiff's experience with the subject vehicle, and the issue of whether Defendant had exclusive and prior knowledge of the defective engine in Plaintiff's subject vehicle.

These topics are directly pertinent to the nature of the instant action.

For all these reasons, the Motion is DENIED.

V. Conclusion & Order

Based on the foregoing, Defendant Ford Motor Company's Demurrer is OVERRULED and Motion to Strike is DENIED. Moving party is ordered to give notice. | Home -->)" -->