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Legal Aid of Nebraska, Inc. v. Chaina Wholesale Inc.

United States District Court, D. Nebraska

January 3, 2020

LEGAL AID OF NEBRASKA, INC., Plaintiff,
v.
CHAINA WHOLESALE, INC., d/b/a DELUXE IMPORT and AMAZON.COM, INC., Defendants.

          MEMORANDUM AND ORDER

          John M. Gerrard United States District Judge

         The plaintiff's complaint alleges products liability claims premised on theories of negligence, failure to warn, and breach of warranty regarding an infrared quartz space heater sold by defendant Chaina Wholesale, Inc., by and through defendant Amazon.com, Inc's website. Filing 1. Defendant Amazon.com moves for dismissal pursuant to Fed.R.Civ.P. 12(b)(6) arguing that the plaintiff failed to state a claim upon which relief can be granted regarding all asserted theories. Filing 6. For the reasons that follow, the Court will grant in part and deny in part Amazon.com's motion.

         I. STANDARD OF REVIEW

         To survive a Rule 12(b)(6) motion to dismiss, a complaint must set forth a short and plain statement of the claim showing that the pleader is entitled to relief. Fed.R.Civ.P. 8(a)(2). This standard does not require detailed factual allegations, but it demands more than an unadorned accusation. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The complaint must provide more than labels and conclusions; and a formulaic recitation of the elements of a cause of action will not suffice. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).

         A complaint must also contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face. Iqbal, 556 U.S. at 678. 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. Id. Where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not shown-that the pleader is entitled to relief. Id. at 679.

         In assessing a motion to dismiss, a court must take all the factual allegations in the complaint as true, but is not bound to accept as true a legal conclusion couched as a factual allegation. Twombly, 550 U.S. at 555. The facts alleged must raise a reasonable expectation that discovery will reveal evidence to substantiate the necessary elements of the plaintiff's claim. See Id. at 545. The court must assume the truth of the plaintiff's factual allegations, and a well-pleaded complaint may proceed, even if it strikes a savvy judge that actual proof of those facts is improbable, and that recovery is very remote and unlikely. Id. at 556.

         A motion to dismiss under Rule 12(b)(6) tests only the sufficiency of the allegations in the complaint, not the sufficiency of the evidence alleged in support of those allegations. Stamm v. Cty. of Cheyenne, Neb., 326 F.Supp.3d 832, 847 (D. Neb. 2018); Harrington v. Hall Cty. Bd. of Supervisors, No. 4:15-CV-3052, 2016 WL 1274534, at *4 (D. Neb. Mar. 31, 2016).

         II. BACKGROUND

         The plaintiff is a domestic non-profit located in Omaha, Nebraska, and provides legal services to disadvantaged individuals. Filing 1 at 1. Defendant Chaina Wholesale, Inc. is a foreign corporation, incorporated in California, and for the purposes of this matter, is engaged in the business of selling or distributing DLux Infrared Quartz Space Heaters. Filing 1 at 1-2. The space heater's manufacturer is alleged to be a Chinese company not subject to service in the state of Nebraska. Filing 1 at 3. Defendant Amazon.com, Inc. is a Delaware corporation with its principal place of business in Seattle, Washington. Filing 1 at 2. The plaintiff alleged that on September 23, 2016, it purchased one of Chaina's DLux Infrared Quartz Space Heaters by and through Amazon.com, and that the space heater was delivered to the plaintiff's place of business in packaging bearing Amazon.com's logo. On or about February 19, 2018, a fire broke out in the plaintiff's leased suite. Filing 1 at 3. The cause of the fire was the DLux Infrared Quartz Space Heater. Id. The fire resulted in damages exceeding $783, 000.00. Filing 1 at 4.

         The plaintiff alleged that Amazon.com "implicitly represented" that the Chaina space heater was safe by listing it on its website where thousands of other items are sold, including Amazon products, and where there exists a procedure for returns. Filing 1 at 2. Amazon.com, according to the plaintiff, affirmatively represented that Chaina's space heater had "overheat protection" and a "plastic housing which stays room temperature to the touch." Filing 1 at 3. Further, Amazon.com "promoted" the space heaters, thus implying that the representations regarding the space heater's quality and safety features are Amazon.com's statements. Filing 1 at 4.

         The plaintiff alleged that Amazon.com's affirmative representations were materially false. Testing of Chaina's space heater showed that there was no overheat protection, and no temperature limiting controls such as a thermal cut-out or high-limit thermostat. Testing also revealed that the enclosure construction was inadequate, and the plastic housing would not remain at room temperature during use. Id. The plaintiff alleged that Chaina and Amazon.com knew or should have known that the space heater was dangerous, not only because of the product's design flaws, but because of consumer complaints and media reports. Filing 1 at 6.

         The plaintiff alleged that Amazon.com played a direct role in the sale and distribution of the space heater. Amazon.com receives a promise of indemnification, and collects fees (which it sets) for the use of its distribution website from vendors such as Chaina, and other importers and China-based manufacturers. Filing 1 at 2. Further, Amazon.com reserves the right to refuse to sell any such products. The plaintiff alleged that Amazon.com had a duty to exercise reasonable care in the sale and distribution of the space heater, but instead promoted, sold and distributed the space heater in a defective condition. Filing 1 at 4-5. According to the plaintiff, Amazon.com, as the promoter, seller and distributor of the space heater, had a duty to warn users of the space heater's inherent risks. Filing 1 at 5. Finally, the plaintiff alleged that Amazon.com's conduct breached an express warranty, and also breached implied warranties of fitness and merchantability. Filing 1 at 5-6.

         III. ...


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