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Carroll v. BMW of North America, LLC

United States District Court, S.D. Indiana, Indianapolis Division

May 9, 2019

PHILLIP CARROLL, Plaintiff,
v.
BMW OF NORTH AMERICA, LLC, BAVARIAN MOTOR WORKS, Defendants.

          ORDER

          Hon. Jane Magnus-Stinson, Chief Judge United States District Court.

         Plaintiff Phillip Carroll purchased a BMW 7 Series (the “Vehicle”) in 2010 for $107, 808.40. On January 22, 2019, Mr. Carroll filed suit against Defendants BMW of North America, LLC (“BMW”) and Bavarian Motor Works seeking damages related to the Vehicle's excessive consumption of engine oil and Defendants' failure to honor the terms of their warranty in violation of the Magnuson-Moss Warranty Act and various Indiana statutes. On March 12, 2019, BMW filed a Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1), and that Motion is now ripe for the Court's review.

         I.

         Standard of Review

         The purpose of a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) is to test the sufficiency of the complaint, not to decide the merits of the case. Rule 12(b)(1) requires dismissal of claims over which the federal court lacks subject-matter jurisdiction. Jurisdiction is the “power to decide, ” Boley v. Colvin, 761 F.3d 803, 805 (7th Cir. 2014), and federal courts may only decide claims that fall within both a statutory grant of authority and the Constitution's limits on the judiciary. In re Chicago, R.I. & P.R. Co., 794 F.2d 1182, 1188 (7th Cir. 1986).

         While a court deciding a Rule 12(b)(1) motion may accept the truth of the allegations in the complaint, it should look beyond the complaint's jurisdictional allegations and view whatever evidence has been submitted on the issue to determine whether subject matter jurisdiction exists. Ciarpaglini v. Norwood, 817 F.3d 541, 543 (7th Cir. 2016). The party asserting the existence of subject matter jurisdiction bears the burden of demonstrating by competent proof that such jurisdiction in fact exists. See Thomas v. Gaskill, 315 U.S. 442, 446 (1942); see also Silha v. ACT, Inc., 807 F.3d 169, 174 (7th Cir. 2015). A Rule 12(b)(1) motion may be raised at any time, by either party or by the Court sua sponte. See Fed. R. Civ. P. 12(h).

         II.

         Background

         The following facts are drawn from Mr. Carroll's Complaint, [Filing No. 1], and are accepted as true for the purpose of resolving BMW's Motion.

         On April 15, 2010, Phillip Carroll purchased the “Vehicle for $107, 808.40 from one of Defendants' authorized dealers (the “Dealer”). [Filing No. 1 at 3.] When Mr. Carroll purchased the Vehicle, Defendants made representations as to its performance and quality and assured Mr. Carroll that the Vehicle was free from defects of workmanship. [Filing No. 1 at 4.] The Vehicle is equipped with a V8, twin-turbocharged engine, known as the N63 engine. [Filing No. 1 at 5.] At the time of purchase, the Vehicle's recommended oil service interval was the earlier of 15, 000 miles or two years. [Filing No. 1 at 10.]

         Within a few years of purchasing the Vehicle, Mr. Carroll observed that it consumed excessive engine oil. [Filing No. 1 at 3.] At some point during the warranty period, the “add oil” light illuminated on the Vehicle's dash, at which point Mr. Carroll notified the Dealer. [Filing No. 1 at 3.] In response, the Dealer told Mr. Carroll that it was normal for the Vehicle's high-performance engine to burn oil, and although the Dealer did not offer any repairs for the Vehicle's excessive consumption of engine oil, the Dealer changed the Vehicle's oil at Mr. Carroll's request. [Filing No. 1 at 3.]

         During the warranty period, Mr. Carroll took the Vehicle to the Dealer for an oil change every 3, 000 miles or whenever the add oil light was illuminated, whichever occurred first. [Filing No. 1 at 4.] After the warranty period, Mr. Carroll added one quart of oil to the Vehicle every 1, 100 miles and he now adds one quart of oil every 250 miles. [Filing No. 1 at 4.]

         In September 2018, Mr. Carroll took the Vehicle to the Dealer, again complaining about its excessive oil consumption. [Filing No. 1 at 4.] The Dealer conducted an analysis and performed an oil change. [Filing No. 1 at 4.] Thereafter, Mr. Carroll drove the Vehicle 800 miles when smoke began emitting from the Vehicle's exhaust and the add oil light illuminated. [Filing No. 1 at 4.]

         Since Mr. Carroll purchased the Vehicle, N63 engines have become widely known for consuming excessive amounts of engine oil and requiring frequent engine repairs. [Filing No. 1at 6.] Defendants have issued several technical service bulletins to address complaints of excessive oil consumption and other problems related to the ...


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