The underlying dispute centers on what plaintiffs call a corrosion defect causing paint bubbling, blistering, and other cosmetic issues in Jeep Wrangler and Jeep Gladiator vehicles manufactured by FCA US, LLC. Plaintiffs — a group of purchasers of new, used, and certified pre-owned Class Vehicles — allege the defect, which they attribute to filiform corrosion occurring beneath the paint surface, has diminished the value of their vehicles and that FCA's repair attempts have been ineffective and have caused further damage.
Judge Matthew F. Leitman of the Eastern District of Michigan granted FCA's motion for summary judgment on the unjust enrichment claims, holding that the warranty and its corrosion-specific provision governed the same subject matter as those claims. The fatal concession came from plaintiffs themselves: they acknowledged that the corrosion warranty explicitly excluded coverage for cosmetic or surface corrosion, which is precisely the category their defect falls into. Under well-settled law across the relevant states, a vehicle purchaser cannot maintain an unjust enrichment claim where an express warranty addresses which defects the manufacturer is and is not responsible for.
The court rejected plaintiffs' argument that the warranty did not govern the corrosion defect simply because it provided no right to a repair. The relevant inquiry, the court held, is not whether the contract entitles the plaintiff to relief, but whether it addresses the subject matter of the claim. Because the corrosion warranty expressly excluded the defect, the parties had already considered and allocated that risk — to the plaintiffs. The court also dismissed the claim brought by plaintiff Raynell McDaniel, who purchased his vehicle used from a third-party dealer in Illinois, on a separate ground: McDaniel produced no evidence that FCA received any benefit from his used-car purchase, a required element under Illinois unjust enrichment law.
A potentially significant part of the ruling concerns what the court permitted next. Plaintiffs' consumer-protection and fraud claims had been dismissed at the pleading stage in 2023 because the court concluded at that time that plaintiffs had not sufficiently alleged FCA's pre-sale knowledge of the corrosion defect. Plaintiffs assert that discovery has since produced evidence that FCA knew the Class Vehicles suffered from filiform corrosion around hinges on the hood, doors, and liftgates, and that FCA knew its repair attempts were ineffective. They had not moved to amend because they believed, based on comments the court made at the 2023 hearing, that further amendments were categorically foreclosed.
Judge Leitman acknowledged that his hearing remarks were not as clear as intended and that plaintiffs' reading — that the door to all future amendments was closed — was not unreasonable. He concluded that fairness required giving plaintiffs the opportunity to seek leave to file a Second Amended Complaint reasserting the previously dismissed consumer-protection claims. In any such motion, plaintiffs must explain what new facts they learned during discovery, how those facts show FCA's pre-sale knowledge of the corrosion defect, how the proposed amendments cure the deficiencies previously identified, what supporting case law exists for reviving a previously dismissed claim on the basis of newly discovered evidence, how the amended complaint would affect the posture of the action including whether additional discovery would be needed, and what prejudice FCA would face at this late stage.
The ruling illustrates the scope of the warranty-preclusion doctrine in automotive defect litigation: an express warranty that excludes a defect bars unjust enrichment recovery just as surely as one that covers it, because either way the contract has addressed the risk. Whether plaintiffs can clear the higher bar of pleading pre-sale knowledge with sufficient specificity to revive their consumer-protection claims — and whether the court will grant leave to amend — remains to be seen.