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D&D Transportation v. Freightliner

April 2, 2008

D&D TRANSPORTATION, PLAINTIFF
v.
FREIGHTLINER, L.L.C., DETROIT DIESEL CORP., ARVIN MERITOR, INC, AND BENDIX COMMERCIAL VEHICLE SYSTEMS, L.L.C., DEFENDANTS



The opinion of the court was delivered by: Sylvia H. Rambo United States District Judge

JUDGE SYLVIA H. RAMBO

MEMORANDUM

This case arises out of a dispute about the performance of nine commercial vehicles leased by Plaintiff. Because of the history of maintenance required for each vehicle, Plaintiff brings suit for breach of express and implied warranty against the Defendant manufacturers of either the vehicles or certain component parts thereof. The claim for breach of implied warranty is addressed on these motions for partial summary judgment. Defendants maintain that they successfully disclaimed the implied warranties on their products or, in the alternative, that the mileage on the tractors demonstrates that they were merchantable and fit for their particular purpose. Plaintiff contends that 1) it did not receive an express warranty or a limitation of implied warranty from certain Defendants; 2) Defendants did not properly disclaim the implied warranties; and 3) the mileage on the tractors is not conclusive evidence that the tractors were merchantable or fit for their intended purpose. For the reasons that follow, the motions will be granted in part and denied in part.

I. Background

A. Facts

The following facts are undisputed, except where noted. In 2003 and 2004, Plaintiff leased*fn1 from a non-party nine commercial tractors for tractor-trailer trucks. The vehicles were manufactured by Defendant Freightliner, LLC ("Freightliner"). All vehicles contained certain component parts manufactured by Defendant Arvin Meritor Transmission ("Arvin Meritor"). The five vehicles leased in 2003 contained engines manufactured by Detroit Diesel Corporation ("Detroit Diesel").*fn2

All Defendants submit that their products were accompanied by an express warranty which contained a disclaimer of all implied warranties. Freightliner provided documentary evidence that someone authorized to act for Plaintiff signed a "Customer Warranty Acknowledgment" ("CWA") for each vehicle. The CWA acknowledges receipt of the Freightliner "Owner's Warranty Information Book" and accepts Freightliner's limited warranty, warranty disclaimer, and limitation of liability. (Doc. 25-3.) Freightliner's limited warranty is contained within a document that consists of thirteen pages of substance. (Doc. 25-4.) The first five pages contain the "Freightliner New Vehicle Warranty"which sets forth the tractor components warranted and the time for which the warranty will be in effect. Pages six and seven contain the "New Vehicle Limited Warranty." All text describing the limited warranty is the same size. Some text is printed with plain formatting, some text is in bold. Among the bold sections is the following, set off in its own paragraph:"The foregoing limited warranty is exclusive and in lieu of all other warranties whether written, oral or implied including, but not limited to any warranty of merchantability or fitness for purpose." (Id.) This excerpt follows a bolded section at the end of the previous paragraph, and precedes another sentence-long paragraph in bold type.

Detroit Diesel submits that it provided a one-page Limited Warranty for its engines. The page heading declares, in approximately eighteen- and sixteen-point font, "Limited Warranty on New Detroit Diesel Series 60 Engines Used in On-Highway Vehicle Applications." (Doc. 25-5.) The left-hand column of the page details the terms of coverage for the warranty provided by Detroit Diesel under the heading in bold and fourteen-point font, "Terms of Coverage." The right-hand column, under the heading in bold and fourteen-point font, "This Warranty Does Not Cover," describes the incidents of use not covered by Detroit Diesel's express warranty. Approximately mid-column, the heading "Other Limitations" appears in bold, fourteen-point font. Under this heading, in text written in all capital letters, is the disclaimer of limited warranty at issue. The disclaimer is in its own paragraph. It is in approximately twelve-point font and is not in bold. It states:

THIS LIMITED WARRANTY AND THE EMISSIONS CONTROL WARRANTY ARE THE ONLY WARRANTIES APPLICABLE TO THE ENGINE AND ACCESSORIES AS USED IN ON-HIGHWAY VEHICLE APPLICATIONS. DETROIT DIESEL CORPORATION MAKES NO OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. DETROIT DIESEL CORPORATION SHALL NOT BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES AS DESCRIBED ABOVE. (Id.)

Plaintiff avers that it did not receive a warranty from Detroit Diesel and was never made aware of any limitation on any implied warranty for Detroit Diesel parts. (Henninger Aff. ¶¶ 1, 4, Sept. 26, 2007.)

Arvin Meritor claims that the component parts it contributed to the vehicles came with an express warranty which contained a disclaimer of all implied warranties. The company made slight changes in its warranty manual from 2003 to 2004. The following description applies to both manuals, except where noted. The manual is twelve pages long. The first page contains a paragraph reminding the end user that understanding warranty coverage is "essential to protecting your investment." (Docs. 21-5, 21-6.) The table of contents notes a "terms and conditions" section, but does not highlight that a warranty limitation is contained therein. The entire manual is twelve pages, nine of which provide substantive warranty information. Pages four through ten set forth the warranties offered on various Arvin Meritor products. Pages eleven and twelve, comprising the "Terms and Conditions" section, limit the warranties.

The 2003 manual has all warranty limitation information on one page, in a two-column format. The text is in approximately ten-point font. About two-thirds down the right-hand column, at point number six on the page, is the "Disclaimer of Warranty." The phrase is not in bold or larger than surrounding text. Immediately below, the disclaimer of implied warranty appears in italicized capital letters, the only text in the paragraph. It states:

THIS WARRANTY IS EXPRESSLY IN LIEU OF ALL OTHER WARRANTIES OR CONDITIONS, EXPRESSED, IMPLIED OR STATUTORY INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE. (Doc. 21-5.) It is the only section of text on the page that is in italicized capital letters.

In 2004, Arvin Meritor changed the layout of its Terms and Conditions section from one page to two pages. Both pages are written with a dual-column format. Page one of the section provides "Coverage Exclusions" and "Coverage Limitations." The disclaimer of implied warranty appears in the right-hand column on page two. All text on page two is in, approximately, ten-point font. At point number six is the "Disclaimer of Warranty." The phrase is not in bold or larger than surrounding text. ...


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