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Rotello v. Clayton Homes of Delaware

September 25, 2006

JOSEPH ROTELLO AND NINA ROTELLO, PLAINTIFFS,
v.
CLAYTON HOMES OF DELAWARE, INC., BERKSHIRE HATHAWAY, INC., CMH SERVICES, INC., CMH MANUFACTURING, INC., CMH INSURANCE AGENCY, INC., AND GEORGE SNYDER, DEFENDANTS.



The opinion of the court was delivered by: Thomas A. Varlan United States District Judge

MEMORANDUM OPINION

This civil action is before the Court on a Motion for Judgment on the Pleadings [Doc. 60] filed jointly by defendants Clayton Homes of Delaware, Inc., Berkshire Hathaway, Inc., CMH Services, Inc., CMH Manufacturing, Inc., and CMH Insurance Agency, Inc. (collectively "Incorporated Defendants"). Plaintiffs have filed a response in opposition to the motion [Doc. 62] and incorporated defendants have filed a reply [Doc. 63].

The Court has carefully considered the parties' briefs [Docs. 61, 62, 63] and the pleadings [Docs. 1, 59] in light of the relevant law. For the reasons set forth herein, incorporated defendants' motion for judgment on the pleadings will be granted in part and denied in part.

I. Relevant Facts

This case arises from plaintiffs' purchase of a manufactured home. According to plaintiffs, on or about April 23, 2001, they entered into a purchase agreement with defendant Clayton Homes, Inc., which is owned by defendant Berkshire Hathaway, Inc., for a new 2001 model manufactured home. [Doc. 1 at ¶ 10.] Plaintiffs claim, however, that they actually received a defective 2000 model manufactured by defendant CMH Manufacturing, Inc. [Id.] Once the defective home was delivered to plaintiffs' address, which was apparently located on real property owned by defendant George Snyder, [Id. at ¶ 62], it was improperly installed by defendant CMH Services, Inc. [Id. at ¶ 12.] Over time, plaintiffs claim they complained about defects, but those defects were never repaired.*fn1 [Id. at ¶ 15.]

On November 5, 2003, Plaintiffs filed a complaint [Doc. 1] with this Court alleging jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1367. [Id. at ¶¶ 2-3. ] Plaintiffs allege breach of contract, breach of express warranty, breach of implied warranties of merchantability and fitness for a particular purpose, violation of the Magnuson-Moss Warranty Act, violation of the Tennessee Consumer Protection Act, fraud, suppression, punitive damages, retaliation, outrageous conduct, negligence, civil conspiracy, strict liability, and agency liability.

Incorporated defendants have filed a motion for judgment on the pleadings pursuant to F. R. Civ. P. 12(c) [Doc. 60]. Plaintiffs filed a response opposing the motion [Doc. 62].

II. Analysis

A. Standard of Review

Defendant has moved to dismiss the plaintiffs' claims pursuant to Fed. R. Civ. P. 12(c). The Court reviews a motion for judgment under Rule 12(c) in the same way that it reviews a motion to dismiss under Fed. R. Civ. P. 12(b)(6). Vickers v. Fairfield Medical Center, 453 F.3d 757, 761 (6th Cir. 2006). A motion to dismiss for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6) should not be granted "unless it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957). All well-pleaded allegations must be taken as true and be construed most favorably toward the non-movant. Trzebuckowski v. City of Cleveland, 319 F.3d 853, 855 (6th Cir. 2003). While a court may not grant a Rule 12(b)(6) motion based on disbelief of a complaint's factual allegations, Lawler v. Marshall, 898 F.2d 1196, 1199 (6th Cir. 1990), the court "need not accept as true legal conclusions or unwarranted factual inferences." Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987). The Sixth Circuit has made it clear that despite the liberal system of notice pleading, "the essential elements of a plaintiff's claim must be alleged in more than vague and conclusory terms" if such a claim is to survive a Rule 12(b)(6) motion. NicSand, Inc. v. 3M Co., 457 F.3d 534, 541 (6th Cir. 2006) (internal citations removed). A complaint must contain either direct or inferential allegations with respect to all material elements necessary to sustain a recovery under some viable legal theory. Weiner v. Klais and Co., Inc., 108 F.3d 86, 88 (6th Cir. 1997). Consequently, a complaint will not be dismissed pursuant to Rule 12(b)(6) unless there is no law to support the claims made, the facts alleged are insufficient to state a claim, or there is an insurmountable bar on the face of the complaint.

The Court will first address plaintiffs' claims that will be dismissed and will then address the remaining claims.

B. Common Law Suppression

Incorporated defendants argue that plaintiffs' claim of common law suppression should be dismissed because no such claim exists under Tennessee law. [Doc. 61 at 12-13.] Plaintiffs claim that Tennessee courts have recognized such a cause of action and cites two cases from the 19th century in support of that contention. [Doc. 62 at 10-11.]

Suppression can be the foundation for tort claims under Tennessee law. See, e.g. Greene v. Brown & Williamson Tobacco Corp., 72 F. Supp. 2d 882, 893 (W.D.Tenn. 1999) (where the defendant cigarette manufacturer's suppression ofresearch regarding the danger of cigarettes was one component of the plaintiff's sufficiently-pleaded claim of civil conspiracy). However, suppression is not a free-standing cause of action under Tennessee law. Both of the cases cited by plaintiffs in their response brief support this conclusion, given that in each case, the court determined that suppression was an element of a claim for fraud. George v. Johnson, 1845 WL 1843 at *1 (Tenn. 1845) (noting that "the consequences of the fraud [were] produced by the suppression of truth"); Herdon v. Lewis, 36 S.W. 953, 957 (Tenn. Ct. ...


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