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Knopick v. Jayco, Inc.

United States District Court, N.D. Indiana, South Bend Division

May 22, 2017

JAYCO, INC., Defendant.


          JON E. DEGUILIO Judge.

         Plaintiff Nicholas Knopick purchased a recreational vehicle at a price of over $400, 000. Instead of purchasing the RV in his own name, though, he purchased and titled it in the name of a limited liability company that he registered in Montana. That maneuver saved him tens of thousands of dollars in sales taxes. Unfortunately for him, it also voided his warranty, which expressly excluded coverage for RVs purchased or titled in the name of a business. That undisputed fact is fatal to the claims he brought in this action against Jayco, Inc. for breach of warranty. Accordingly, the Court grants Jayco's motion for summary judgment.


         Plaintiff Nicholas Knopick arranged to buy an Entegra Coach Cornerstone RV, manufactured by defendant Jayco, Inc. He negotiated the purchase at a dealership in Florida, but he finalized the purchase and took delivery of the RV at another dealership in Des Moines, Iowa. Though documents were prepared at the Florida dealership in Mr. Knopick's own name, he did not complete the purchase or take title in his own name. Instead, he purchased the RV in the name of Montana Freedom Rider, LLC, a Montana limited liability company of which he was the sole member. A Montana title was thus issued for the RV listing Montana Freedom Rider, LLC as the owner. The warranty registration likewise names Montana Freedom Rider, LLC as the owner. Mr. Knopick also admits that Montana Freedom Rider, LLC is the owner of and holds title to the RV.

         The RV came with a two-year limited warranty covering defects in materials or workmanship. However, the warranty also set forth a number of circumstances in which coverage would be excluded or the warranty would be voided. Under the heading of “What is Not Covered” (which is set in bold, all-caps font), the warranty states:

[T]his limited warranty does not cover . . . any RV used for rental or other commercial purposes (Note: It shall be concluded that the RV has been used for commercial and/or business purposes if the RV owner or user files a tax form claiming any business or commercial tax benefit related to the RV, or if the RV is purchased, registered or titled in a business name)[.]

[DE 83-1 p. 10]. The next section, under the heading of “Events Discharging Entegra from Obligation under Warranty, ” states that “[c]ertain things completely discharge Entegra from any obligation under this warranty and void it.” Id. p. 13. One such event is “any rental or other commercial use or purchase of the RV (as defined in this warranty).” Id.

         After taking delivery of the RV in Iowa, Mr. Knopick drove it back to Jayco's factory in Indiana, where Jayco performed repairs on the RV. Mr. Knopick alleges, though, that a number of defects remained that Jayco failed to correct. He therefore filed this action, asserting a breach of the express written warranty. He initially filed this action in state court in Florida, but Jayco removed the case to federal court in the Southern District of Florida. That court then granted Jayco's motion to transfer venue to the Northern District of Indiana. Jayco has now moved for summary judgment, and that motion is fully briefed.


         Summary judgment is proper when the movant shows that there “is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A “material” fact is one identified by the substantive law as affecting the outcome of the suit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A “genuine issue” exists with respect to any material fact when “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. Where a factual record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial, and summary judgment should be granted. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citing Bank of Ariz. v. Cities Servs. Co., 391 U.S. 253, 289 (1968)). In determining whether a genuine issue of material fact exists, this Court must construe all facts in the light most favorable to the non-moving party and draw all reasonable and justifiable inferences in that party's favor. Jackson v. Kotter, 541 F.3d 688, 697 (7th Cir. 2008); King v. Preferred Tech. Grp., 166 F.3d 887, 890 (7th Cir. 1999).


         Mr. Knopick asserts two claims in this action. The first is a claim for breach of an express warranty, arising under state law. The second claim also asserts a breach of an express warranty, but arises under the Magnuson Moss Warranty Act. As to limited warranties like the one here, though, the Magnuson Moss Warranty Act does not create substantive rights, but merely provides a federal cause of action to enforce warranties in federal court, borrowing state law causes of action. Anderson v. Gulf Stream Coach, Inc., 662 F.3d 775, 781 (7th Cir. 2011). Thus, both claims boil down to whether Jayco breached an express warranty under state law. Id. (“[F]or all practical purposes, the MMWA operates as a gloss on the [plaintiffs'] state law breach of warranty claims.”).

         A claim for a breach of warranty requires a plaintiff to show that a warranty existed, that the defendant breached the warranty, and that the breach was the proximate cause of the loss. Irmscher Suppliers, Inc. v. Schuler, 909 N.E.2d 1040, 1048 (Ind.Ct.App. 2009) (applying Indiana law); Swan Lake Holdings, LLC v. Yamaha Golf Cart Co., No. 3:09-cv-228, 2010 WL 3894576, at *3 (N.D. Ind. Sept. 27, 2010).[1] Mr. Knopick's claims are based solely on the express written warranty, so he must show that Jayco failed to comply with the terms of that warranty. Sanchez-Knutson v. Ford Motor Co., 52 F.Supp.3d 1223, 1231 (S.D. Fla. 2014) (stating that under Florida law, “there can be no cause of action for breach of an express limited warranty unless the consumer can allege and prove that the manufacturer did not comply with the limited express warranty's terms.”); Aprigliano v. Am. Honda Motor Co., Inc., 979 F.Supp.2d 1331, 1339 (S.D. Fla. 2013) (applying Florida law) (“A manufacturer's liability for breach of an express warranty derives from, and is measured by, the terms of that warranty.”). In moving for summary judgment, Jayco's principal argument is that it could not have breached any obligations under the warranty because the warranty expressly excludes coverage if an RV is purchased or titled in a business name, and the RV at issue here was purchased and titled in the name of Montana Freedom Rider, LLC.

         The warranty details a number of circumstances in which coverage is excluded or the warranty is voided. Under the heading of ...

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