## Facts

- Ralph Szubski and Computer Jungle, Inc. leased a 2000 Mercedes-Benz E320S for Szubski’s personal use on or about November 29, 1999.
- A leasing bank purchased the vehicle (for purposes other than resale) and leased it to plaintiffs.
- Mercedes-Benz, U.S.A., L.L.C. (MBUSA) allegedly issued and supplied written warranties, including a 4-year/50,000-mile limited warranty described in a warranty booklet.
- At the time of the sale to the lessor, the vehicle had approximately 17 miles and was covered by the manufacturer’s written warranty.
- Plaintiffs alleged the lessor assigned its rights in the manufacturer’s written warranty to plaintiffs at the start of the lease.
- Plaintiffs alleged the vehicle had defects, MBUSA failed to adequately repair or replace it, and plaintiffs suffered damages.
- Plaintiffs sued asserting (1) breach of written warranty under the Magnuson-Moss Warranty Act, (2) breach of implied warranty of merchantability under Magnuson-Moss, and (3) an Ohio Lemon Law claim.
- MBUSA moved to dismiss only the Magnuson-Moss counts under Ohio Civ. R. 12(B)(6).

## Issues

1. Whether vehicle lessees who did not purchase the vehicle can qualify as “consumers” under the Magnuson-Moss Warranty Act and sue for breach of a manufacturer’s written warranty.
2. Whether vehicle lessees can maintain a Magnuson-Moss claim for breach of the implied warranty of merchantability where implied-warranty rights arise under Ohio law and the Act’s “consumer” definition.

## Decision

- The court denied MBUSA’s motion to dismiss Counts I (written warranty) and II (implied warranty of merchantability).
- The court held plaintiffs sufficiently alleged “consumer” status under Magnuson-Moss based on transfer of the vehicle during the warranty period and alleged entitlement to enforce warranty obligations.
- The court held plaintiffs sufficiently stated a Magnuson-Moss implied-warranty claim because implied warranties are supplied by state law and were plausibly alleged to run from the manufacturer to plaintiffs under Ohio law.

## Legal Principles

- On a Civ. R. 12(B)(6) motion, the court accepts well-pleaded factual allegations as true and dismisses only if no set of facts would permit recovery.
- Magnuson-Moss defines “consumer” to include not only buyers, but also (a) persons to whom the product is transferred during the duration of a written or implied warranty and (b) persons entitled by the warranty terms or applicable state law to enforce warranty obligations.
- A lessee may qualify as a Magnuson-Moss “consumer” where the leased product is transferred subject to an existing manufacturer warranty and warranty rights are assigned or otherwise enforceable by the lessee.
- Magnuson-Moss provides a federal cause of action for breach of implied warranties that exist under state law; it does not itself create implied warranties.
- Under Ohio law, an implied warranty of merchantability may run from a manufacturer to an ultimate user in circumstances supporting an intent to benefit that end user, permitting an implied-warranty claim to proceed at the pleading stage.

## Conclusion

The court allowed Magnuson-Moss written- and implied-warranty claims to proceed in a vehicle lease context, holding that lessees can plausibly qualify as statutory “consumers” when the vehicle is transferred during the warranty period and the lessee is alleged to have enforceable warranty rights under the warranty’s terms or Ohio law.


Szubski v. Mercedes-Benz, U.S.A., L.L.C., 124 Ohio Misc. 2d 82, 796 N.E.2d 81 (Ohio Ct. Com. Pl. 2003)