Kevin Gerhardt vs. General Motors LLC, a Delaware Limited Liability Company

34-2020-00281778-CU-BC-GDS: Kevin Gerhardt vs. General Motors LLC, a Delaware Limited Liability Company 04/07/2026 Hearing on Demurrer (Lemon Law) to Plaintiffs' Third Amended Complaint in Department 54

Tentative Ruling

The Court rules on the demurrer filed by Defendant General Motors LLC (“Defendant”) as follows.

FACTS AND PROCEDURAL BACKGROUND

On or about April 25, 2018, Plaintiffs Kevin Gerhardt and Performance Trailers, Inc., (“Plaintiffs”) purchased a 2016 Chevrolet Silverado 1500, VIN 3GCUKREC2GG334281 (“Subject Vehicle”). (Third Amended Complaint (“TAC”) ¶ 5.) Plaintiffs allege that the Subject Vehicle developed various alleged “defects” during the warranty period. On July 15, 2020, Plaintiffs filed their original Complaint alleging breach of warranty and fraud claims.

On December 11, 2020, Plaintiffs filed a First Amended Complaint (“FAC”) containing additional allegations. Therein, Plaintiffs asserted claims for fraudulent inducement-concealment.

Plaintiffs filed a Second Amended Complaint on September 15, 2021, and subsequently filed a Third Amended Complaint (TAC) on October 14, 2025. In the TAC, Plaintiffs assert claims for breach of express warranty under the California Commercial Code (Count I); violation of the Magnuson-Moss Warranty Act (Count II); fraudulent inducement-concealment (Count III); and a claim for violation of the Consumers Legal Remedies Act (“CLRA”) (Count IV). (See generally TAC.) On November 10, 2025, Defendants filed a demurrer to the TAC.

Specifically, Defendants contend that the Third Cause of Action for Fraudulent Concealment fails to state facts sufficient to state a cause of action and, in addition or alternatively, fails to allege a transactional relationship giving rise to a duty to disclose. Defendants also challenge the Fourth Cause of Action for failing to allege facts sufficient to state a cause of action under the CLRA.

DISCUSSION

The function of a demurrer is to test the sufficiency of the pleading it challenges by raising

34-2020-00281778-CU-BC-GDS: Kevin Gerhardt vs. General Motors LLC, a Delaware Limited Liability Company 04/07/2026 Hearing on Demurrer (Lemon Law) to Plaintiffs' Third Amended Complaint in Department 54

questions of law. (Salimi v. State Comp. Ins. Fund (1997) 54 Cal.App.4th 216, 219; Nordlinger v. Lynch (1990) 225 Cal.App.3d 1259, 1271.) A demurrer “tests the pleadings alone and not the evidence or other extrinsic matters.” (SKF Farms v. Superior Court (1984) 153 Cal.App.3d 902, 905.) Extrinsic evidence may not properly be considered on demurrer or in a motion to strike. (Ion Equipment Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881; Hibernia Savings & Loan Soc. v. Thornton (1897) 117 Cal. 481, 482.)

For the purpose of determining the effect of a complaint, its allegations are liberally construed, with a view toward substantial justice. (Code Civ. Proc. § 452; Amarel v. Connell (1988) 202 Cal.App.3d 137, 140-141; Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 43, fn. 7.) In this respect, the Court treats the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law, and considers matters which may be judicially noticed. (Blank v.

Kirwan (1985) 39 Cal.3d 311, 318; Poseidon Development, Inc. v. Woodland Lane Estates, LLC (2007) 152 Cal.App.4th 1106, 1111-1112.)

A demurrer may be sustained only if the complaint lacks any sufficient allegations to entitle the plaintiff to relief. (Financial Corp. of America v. Wilburn (1987) 189 Cal.App.3d 764, 778.) “Plaintiff need only plead facts showing that he may be entitled to some relief . . ., we are not concerned with plaintiff's possible inability or difficulty in proving the allegations of the complaint.” (Highlanders, Inc. v. Olsan (1978) 77 Cal.App.3d 690, 696-697.)

With regard to the causes of action premised on fraudulent concealment and violation of the CLRA, the Court will address both simultaneously since the same arguments and analysis apply to each. Defendant argues that Plaintiffs have failed to plead fraud with requisite specificity. In particular, Defendant contends that Plaintiffs failed to plead facts that show that fraud occurred specific to the Subject Vehicle, as opposed to fraud regarding the quality and performance of the general automobile class to which the Subject Vehicle belongs. A review of the TAC establishes that Plaintiffs’ claims are premised on allegations that GM fraudulently concealed information regarding defects in the Subject Vehicle and other vehicles of its same make and model.

The elements of a claim for fraudulent concealment require the plaintiff to show that: “(1) the defendant ... concealed or suppressed a material fact, (2) the defendant [was] under a duty to disclose the fact to the plaintiff, (3) the defendant ... intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff [was] 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. [Citation.]” (Prakashpalan v. Engstrom, Lipscomb & Lack (2014) 223 Cal.App.4th 1105, 1130.) A duty to disclose material facts may arise not only when the defendant is in a fiduciary

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

34-2020-00281778-CU-BC-GDS: Kevin Gerhardt vs. General Motors LLC, a Delaware Limited Liability Company 04/07/2026 Hearing on Demurrer (Lemon Law) to Plaintiffs' Third Amended Complaint in Department 54

relationship with the plaintiff but also when the defendant has exclusive knowledge of material facts not known to the plaintiff or when the defendant actively conceals a material fact from the plaintiff. (LiMandri v. Judkins (1997)52 Cal.App.4th 326, 336.) While California requires that fraud must be pled specifically (general and conclusory allegations do not suffice), “[i]t is harder to apply [the requirement of specificity] to a case of simple nondisclosure. ‘How does one show ‘how’ and ‘by what means’ something didn’t happen, or “‘when’ it never happened, or ‘where’ it never happened?’” (Jones v.

ConocoPhillips Co. (2011) 198 Cal.App.4th 1187, 1199 [internal citations omitted].) “Even under the strict rules of common law pleading, one of the canons was that less particularity is required when the facts lie more in the knowledge of the opposite party.” (Id.) (internal citations omitted.) [KC1] The Court concludes that Plaintiff sufficiently alleges (1) concealment (TAC, ¶¶ 21-22, 34, 39, 48, 56-68, 81, 108, 111), (2) knowledge of falsity (FAC, ¶¶ 16-17) (3) reliance (FAC, ¶¶ 24, 34, 40, 65-67, 107-111), and (4) damages (FAC, ¶¶ 5, 25-27, 65-68, 109-111.).

The identified paragraphs in the TAC establish that Plaintiffs entered into a warranty contract with GM on April 25, 2018; Plaintiffs have identified material facts GM purportedly knew prior to their acquisition of Subject Vehicle and withheld from Plaintiffs; that Defendant had superior knowledge of the facts, including but not limited to the Transmission Defects and the safety risks posed thereby; Plaintiffs reliance on the alleged non-disclosure and damages. These allegations are sufficient and pled with the requisite level specificity for purposes of demurrer.

Accordingly, the demurrer to the Third and Fourth Causes of Action based on failure to state a cognizable claim is OVERRULED.

As noted, Defendant also demurs to the Third Cause of Action on the grounds that Plaintiffs fail to allege facts sufficient to establish a transactional relationship giving rise to a duty to disclose. Here, Plaintiffs allege that they entered into a warranty contract with Defendant GM regarding the Subject Vehicle on April 25, 2018. Accepting this allegation as true for purposes of demurrer, as the Court must, the Court concludes that it is sufficient to establish a direct transactional relationship between Plaintiffs and Defendant.

Further, as explained in OCM Principal Opportunities Fund v. CIBC World Markets Corp. (2007) 157 Cal.App.4th 935, no transactional relationship between a vendor and subsequent purchasers is necessary to bring a fraudulent omission claim because a vendor has a duty to disclose material facts not only to immediate purchasers, but to subsequent purchasers when the vendor has reason to know that the subject product will be resold. (Id. at 859-860.) Further, the legal authorities cited in GM's moving papers are inapposite.

Indeed, Defendant’s primary reliance on Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276 is factually distinguishable since the manufacturer in Bigler- Engler was not aware that its product (a medical device) was provided to the plaintiff, and in any event, the primary issues on appeal related to the sufficiency of evidence at trial. (Id. at 312- 313.) Further, Defendant's reliance on a purported lack of direct “transactional relationship” ignores the Song-Beverly Consumer Warranty Act’s provision that treat a vehicle manufacturer

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

34-2020-00281778-CU-BC-GDS: Kevin Gerhardt vs. General Motors LLC, a Delaware Limited Liability Company 04/07/2026 Hearing on Demurrer (Lemon Law) to Plaintiffs' Third Amended Complaint in Department 54

and its representatives in 'this state' as a single entity. (Ibrahim v. Ford Motor Co. (1989) 214 Cal.App.3d 878, 889.) For these additional reasons, the demurrer to the Third Cause of Action is OVERRULED. Defendant shall file an Answer to the Third Amended Complaint on or before April 21, 2026.

This Minute Order is effective immediately. No formal order or other notice is required. (Code Civ. Proc. § 1019.5; CRC Rule 3.1312.)

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NOTICE:

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

34-2020-00281778-CU-BC-GDS: Kevin Gerhardt vs. General Motors LLC, a Delaware Limited Liability Company 04/07/2026 Hearing on Demurrer (Lemon Law) to Plaintiffs' Third Amended Complaint in Department 54

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