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AMC West Housing LP v. Nibco, Inc.

United States District Court, W.D. Oklahoma

September 18, 2019

AMC WEST HOUSING LP, Plaintiff,
v.
NIBCO, INC., Defendant.

          ORDER

          TIMOTHY D. DEGIUSTI CHIEF UNITED STATES DISTRICT JUDGE.

         Before the Court is Defendant’s Motion to Dismiss for Failure to State a Claim [Doc. No. 8]. Plaintiff has responded in opposition [Doc. No. 11], and Defendant has replied [Doc. No. 12]. The matter is fully briefed and at issue.

         BACKGROUND

         This case arises out of the purchase and installation of allegedly defective plumbing products in homes owned and managed by Plaintiff at Tinker Air Force Base in Oklahoma City, Oklahoma. Plaintiff filed an Amended Complaint [Doc. No. 4] on October 25, 2018[1], alleging causes of action for breach of express and implied warranty, deceptive trade practices, manufacturer’s products liability, negligence, and fraud. Defendant moves to dismiss [Doc. No. 8], asserting that the applicable statute of limitations bar Plaintiff’s claims.[2] In response, Plaintiff asserts that the plumbing leaks in 2009 were isolated and did not start the running of the statute of limitations. Alternatively, Plaintiff argues that the triggering of the statute of limitations is a question of fact reserved for the jury. Finally, Plaintiff contends that Defendant’s fraudulent conduct tolled the statute of limitations.

         STANDARD OF DECISION

         “To survive a motion to dismiss [under Rule 12(b)(6)], a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. The “plausibility standard” announced in Twombly and Iqbal is not a “heightened standard” of pleading, but rather a “refined standard.” Khalik v. United Air Lines, 671 F.3d 1188, 1191 (10th Cir. 2012) (citing Kansas Penn Gaming, LLC v. Collins, 656 F.3d 1210, 1214 (10th Cir. 2011)). Under the “refined standard, ” plausibility refers “to the scope of the allegations in the complaint: if they are so general that they encompass a wide swath of conduct, much of it innocent, then the plaintiffs ‘have not nudged their claims across the line from conceivable to plausible.’” Khalik, 671 F.3d at 1191; see also Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir. 2008) (quoting Twombly, 550 U.S. at 570).

         Further, the Tenth Circuit has noted that “[t]he nature and specificity of the allegations required to state a plausible claim will vary based on context.” Khalik, 671 F.3d at 1191 (quoting Kansas Penn Gaming, 656 F.3d at 1215). “Thus, [it has] concluded the Twombly/Iqbal standard is ‘a middle ground between heightened fact pleading, which is expressly rejected, and allowing complaints that are no more than labels and conclusions or a formulaic recitation of the elements of a cause of action, which the Court stated will not do.’” Id. (quoting Robbins, 519 F.3d at 1247).

         “In other words, Rule 8(a)(2) still lives. There is no indication the Supreme Court intended a return to the more stringent pre-Rule 8 pleading requirements.” Id. It remains true that “[s]pecific facts are not necessary; the statement need only ‘give the defendant fair notice of what the … claim is and the grounds upon which it rests.’” Erickson v. Pardus, 551 U.S. 89, 93 (2007) (quoting Twombly, 550 U.S. at 555); see also al-Kidd v. Ashcroft, 580 F.3d 949, 977 (9th Cir. 2009) (“Twombly and Iqbal do not require that the complaint include all facts necessary to carry the plaintiff’s burden.”).

         Finally, “[w]hile the 12(b)(6) standard does not require that Plaintiff establish a prima facie case in [its] complaint, the elements of each alleged cause of action help to determine whether Plaintiff has set forth a plausible claim.” Khalik, 671 F.3d at 1192 (citing Swierkiewicz v. Sorema N.A., 534 U.S. 506, 515 (2002)). “[A] well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of [the alleged] facts is improbable, and ‘that a recovery is very remote and unlikely.’” Sanchez v. Hartley, 810 F.3d 750, 756 (10th Cir. 2016) (citing Twombly, 550 U.S. at 556).

         DISCUSSION

         According to Plaintiff’s allegations, in 2008, Plaintiff contracted with Balfour Beatty Construction Company, Inc. (“Balfour”) to construct 398 homes, which Plaintiff would, in turn, lease to service members stationed at Tinker AFB. Balfour’s subcontractor, Horizon Plumbing, purchased Defendant’s plumbing products based on Defendant’s assurances and representations. Defendant had been in the plumbing business for more than 100 years and had manufactured plumbing systems and parts for nearly that long.

         Defendant manufactures, warrants, advertises, and sells various plumbing products, including the alleged defective PEX Products[3] at issue in this case. The plumbing systems installed in properties at Tinker AFB included tubing products manufactured by Defendant – PEX Tubing, PEX Fittings, and PEX Clamps.[4] Plaintiff asserts that the PEX fittings were “easily identified” by a stamp bearing Defendant’s name on the brass insert fittings. [Doc. No. 4 at ¶ 41]. Defendant represented in its sales catalog that its PEX Tubing was the highest quality available, and that its cross-chemical binding process gave it “superior characteristics.” Id. at ¶ 23. Defendant also advertised that its PEX Products were “chlorine-resistant, corrosion-resistant, freeze damage and abrasion resistant, ” and that “the excellent thermal properties of PEX are ideal for hot and cold water distribution.” Id. at ¶ 25.

         Although Defendant warranted that its PEX Tubing would be free from defects for 25 years, Plaintiff’s homes “began to experience leaks resulting from cracks in Defendant’s PEX Tubing as early as 2009.” Id. at ¶ 62. Plaintiff alleges that Defendant’s products deteriorated prematurely, due to the tubing’s defective design and/or manufacture, which caused leaks and significant property damage throughout the homes. The leaks and property damage are ongoing, with new leaks and damage being discovered on a weekly basis.

         Defendant’s PEX Tubing comes with an express warranty that guarantees no defects in materials and workmanship when the tubing is installed by a professional contractor like Horizon Plumbing.[5] On October 20, 2017, Plaintiff made demands on Defendant pursuant to the PEX warranty. Plaintiff alleges that the entire plumbing system for each of the 398 homes will have to be replaced.

         Finally, Plaintiff alleges that any applicable statute of limitations has been tolled by Defendant’s “knowing and active concealment and denial of the facts.” Id. at ¶ 71. Plaintiff asserts that it could not have reasonably discovered the true nature of the allegedly defective PEX Products until their “catastrophic failure.” Id. A Tolling Agreement was purportedly in place from December 6, 2017 until December 31, 2018. Id; see also [Doc. No. 4-2].

         A. Statute ...


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