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Johnson v. Thacker Enterprises, Inc.

United States District Court, D. Utah

July 25, 2017



          Dee Benson United States District Judge.

         Before the court is Defendant Manheim Remarketing, Inc.'s (“Manheim”) Motion for Summary Judgment. (Dkt. No. 41.) In its Motion, Manheim seeks dismissal on three grounds: that Manheim was not a “transferor” within the meaning of the Federal Motor Vehicle Information and Cost Savings Act, 49 U.S.C. § 32701, et seq. (the “Odometer Act”); that Manheim did not know that the vehicle's odometer had been tampered with, nor did it have any intent to defraud; and that Plaintiffs' claims are barred by the Odometer Act's two-year statute of limitations. The Motion has been fully briefed by both parties, and the court has considered the facts and arguments set forth in those filings. Pursuant to civil rule 7-1(f) of the United States District Court for the District of Utah Rules of Practice, the Court elects to determine the motion on the basis of the written memoranda and finds that oral argument would not be helpful or necessary. DUCivR 7-1(f).


         On November 28, 2011, Plaintiffs purchased a GMC Sierra 1500 pickup (the “GMC”) from Defendant Thacker Enterprises, Inc. dba One Stop Auto Sales (“One Stop”) and Fred Thacker (“Thacker”). (First Amended Complaint (“Compl.”) at ¶ 43.) At the time of the sale, the mileage listed for the GMC was 85, 103. (Id. at ¶ 50.) Prior to purchasing the vehicle, Plaintiffs requested a Carfax report but were assured by One Stop salesperson Tyson Savage that the vehicle was clean, without collisions, and had low miles. (Id. at ¶ 47.)

         In December of 2013, Plaintiffs placed the GMC for sale. (Id. at ¶ 55.) At that time, Plaintiffs were informed by a potential buyer that the Carfax for the GMC showed that the odometer reading had been altered. (Id.) Plaintiffs subsequently discovered that Samuel Ruben Garcia (“Garcia”) purchased the GMC from O'Reilly Chevrolet, Inc. (“O'Reilly”) on approximately August 27, 2007. (Id. at ¶ 29.) At the time of purchase in 2007, the GMC's odometer showed 83, 169 miles. (Id.) As of February 24, 2009, the mileage on the GMC showed 121, 789 miles. (Id. at ¶ 31.) As of June 12, 2010, the mileage shown on the odometer of the GMC was reported as 65, 448 miles. (Id. at ¶ 33.) Thus, sometime between February 2009 and June 2010, Garcia tampered with or caused the odometer on the GMC to be tampered with, reducing the mileage shown by at least 56, 000 miles less than the actual miles on the GMC (Id. at ¶ 32; Declaration of Ronald Ady (“Ady Decl.”)[1] at ¶¶ 11-12.) The mileage discrepancy was reported on Carfax as of January 1, 2011. (Id. at ¶ 34.)

         Garcia owned the vehicle until he traded it back in to O'Reilly in March of 2011. (Id. at ¶ 35.) At the time of the 2011 trade-in, the odometer for the GMC showed as few or fewer miles than it had shown when O'Reilly sold the vehicle to Garcia about three and a half years earlier. (Id. at ¶ 37.) Plaintiffs allege that Garcia informed O'Reilly that he had replaced the odometer and that the mileage was understated. (Id. at ¶ 36.) Plaintiffs alternatively allege that the odometer was non-functional at the time Garcia traded it in to O'Reilly. (Id. at ¶ 36.)

         On March 9, 2011, O'Reilly sold the GMC to One Stop at a Manheim-hosted auction sale in Tucson, Arizona. (Id. at ¶ 39; Declaration of John Duplanty (“Duplanty Decl.”) at ¶ 6.) At the auction, as with all Manheim auctions, Manheim acted as an auctioneer-a forum in which registered dealers could buy and sell motor vehicles to other registered dealers. (Duplanty Decl. at ¶ 3.) Manheim did not take ownership of, or title to, the GMC at any point during or after the auction. (Id.) After One Stop placed the winning bid on the GMC, Manheim generated an invoice for the purchase, listing the seller as O'Reilly and the purchaser as One Stop. (Id. at ¶ 7.) The invoice contains the following disclaimer:

SELLER and PURCHASER agree that AUCTION is neither responsible for odometer mileage on the consigned vehicles nor for the information contained in the odometer mileage statement which SELLER as Transferor is required to complete and sign and PURCHASER as Transferee is required to acknowledge.
SELLER and PURCHASER agree that all representations concerning the Vehicle are solely the responsibility of the SELLER. ***
AUCTION is merely performing an auction service, and expressly disclaims all express and/or implied warranties as to merchantability, fitness or any other matter whatsoever other than the title guarantee set forth above.

(Id.) For its role in the transaction, Manheim received a seller's fee of $90 from O'Reilly and a purchaser's fee of $195 from One Stop. (Id. at ¶ 10.)

         O'Reilly did not provide a certificate of title to One Stop at the time of sale. (Id. at ¶ 9.) When O'Reilly ultimately provided the title, possibly within hours of the sale, the front of the title stated that the actual miles were 83, 169, but the reassignment portion on the back of the title stated that the vehicle had 82, 096 miles. (Ady Decl. at ¶ 34.) Plaintiffs believe that, as a result of this discrepancy, O'Reilly and One Stop proceeded to arbitration to resolve the issue. (Id.) Plaintiffs also believe that this arbitration process was conducted “through the Tucson auction by Defendant Manheim[.]” (Id. at 28.)

         On April 14, 2011, a new title was issued for the GMC, with stated mileage of 83, 169 miles. (Id. at ¶ 37, Ex. H.) Plaintiffs claim that a representative of Manheim, Teresa Loera, may have notarized the title and thus that the person who signed the title as a representative of O'Reilly may also have been a representative of Manheim, acting as an agent of O'Reilly. (Id. at ΒΆ 37.) Plaintiffs request denial or deferral of Manheim's ...

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