United States District Court, W.D. Virginia, Charlottesville Division
GLEN E. CONRAD, Chief District Judge.
In this diversity action, the plaintiff, Price Automotive II, LLC, claims that the defendants conspired to sell a vehicle that was represented to be an authentic 1956 Maserati 300S to the plaintiff's assignor, and that what the plaintiff and its assignor actually purchased was a counterfeit vehicle. The case is presently before the court on the defendants' motions to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons set forth below, the motions will be granted with respect to the plaintiff's claim for special damages, but will otherwise be denied.
The following facts, taken from the plaintiff's second amended complaint, are accepted as true for purposes of the defendants' motions to dismiss. See Erickson v. Pardus, 551 U.S. 89, 94 (2007).
Maserati, an Italian car manufacturer, produced a limited number of 300S racing cars between 1955 and 1958. Those still in existence are highly coveted by automobile collectors.
In 2004, Oliver Kuttner ("Kuttner"), the principal of Mass. Management, LLC, Edison 2 Motors ("Mass Management"), purchased a chassis for a Maserati 300S that was designed by Peter Shaw (the "Shaw Chassis"). The Shaw Chassis is a replica of the original Maserati chassis, and any car built upon it is far less valuable than the original model.
After purchasing the Shaw Chassis, Kuttner caused a false vehicle identification number ("VIN") plate with the number 3067 to be placed on the chassis. The Shaw Chassis was then used to assemble a vehicle that was passed off by Kuttner and Bruce Amster ("Amster"), a principal of Red Line Restorations, LLC ("Red Line"), as an authentic Maserati 300S with chassis number 3067 ("the Vehicle").
Kuttner, with Amster's assistance, initially sold the Vehicle to Scott Rosen ("Rosen") in November of 2008. During the course of that transaction, Kuttner falsely represented that the Vehicle was an original Maserati 300S with chassis number 3067. This misrepresentation was included in a sworn and notarized statement from Kuttner, in which he described the Vehicle as a "Maserati 300S #3067." 2d Am. Compl. Ex. D.
Rosen and Kuttner agreed that Amster and his employees at Red Line would perform restoration work on the Vehicle. Amster and his employees assembled the Vehicle using parts in Kuttner's inventory, with Amster exercising control over what parts were used in the process. While performing the restoration work, Amster became aware that the number 3067 VIN plate had been moved from a different chassis to the Shaw Chassis used to assemble the Vehicle.
At some point after Rosen purchased the Vehicle, Rosen questioned whether the Vehicle was constructed with a Shaw Chassis rather than an original chassis from the Maserati factory. In response, Kuttner assured Rosen that the Vehicle was an authentic Maserati 300S with chassis number 3067.
Rosen subsequently commissioned Walter Baumer, a noted Maserati historian, to authenticate the Vehicle. When Baumer expressed concerns regarding the Vehicle's authenticity, Kuttner and Amster took steps to persuade him that the Vehicle was an original Maserati 300S with chassis number 3067 from the Maserati factory. For instance, in or around November of 2010, Kuttner and Amster travelled to Germany to meet with Baumer in person. During the meeting, Kuttner and Amster described Kuttner's purported acquisition of the Vehicle in 1986, and the details on the Vehicle that appeared genuine, including the number 3067 plate on the Vehicle's chassis. Kuttner and Amster also provided Baumer with a written report prepared by Amster. In the report, Amster falsely represented that the Vehicle's chassis was a number 3067 chassis, and attempted to distinguish the Vehicle's chassis from the Shaw Chassis. Based on the false representations made by Kuttner and Amster, Baumer prepared a written report for Rosen in which he opined that the Vehicle appeared to be genuine. Baumer's report incorporated what Kuttner and Amster had told him about the Vehicle's chassis and omitted any reference to the Shaw Chassis.
In early 2013, Rosen ultimately concluded that the Vehicle was not authentic. Rosen forced Kuttner to refund the purchase price of the Vehicle, and to reimburse him for the additional expenses that he had incurred in connection with the Vehicle. After Kuttner regained possession of the Vehicle, it remained at Red Line, where Amster continued to oversee its restoration.
In August of 2013, Stephen Bell ("Bell"), the principal of the plaintiff's assignor, Classic Investments, Inc. ("Classic Investments"), was approached by a broker, Jim Carpenter ("Carpenter"), about the possibility of acquiring the Vehicle from Kuttner. At Kuttner's direction, Carpenter sent Bell various materials purporting to show the history and provenance of the Vehicle as an original Maserati 300S with chassis number 3067, including the sworn statement from Kuttner. Kuttner also directed Amster to provide Baumer's written report to Carpenter, so that Carpenter could relay the report to Classic Investments.
Amster also repeatedly represented to Carpenter that the manufacturer, Maserati, would certify the Vehicle as authentic. The plaintiff alleges that Amster knew that this statement was false, and that the statement was made with the intention and expectation that it would be relayed to and relied upon by the plaintiff and Classic Investments. Amster also spoke to Bell by telephone on multiple occasions during the course of the negotiations between Classic Investments and Kuttner regarding the Vehicle, but never disclosed to Bell that he knew that the 3067 number plate on the Vehicle had been moved from another chassis, or that another buyer had returned the Vehicle after determining that it was not authentic.
Relying on the defendants' representations regarding the authenticity of the Vehicle, Bell and the plaintiff made arrangements to purchase the Vehicle. The sale was made with Amster's acquiescence and approval, and with the understanding that Amster and Red Line would receive a commission from the sale.
In September of 2013, Bell and Kuttner executed a written sale agreement (the "Amended Bill of Sale"), which provides, in pertinent part, as follows:
FOR AND IN CONSIDERATION OF $3, 300, 000 USD (three million three hundred thousand U.S. dollars), the undersigned grants, sells, transfers, and conveys to CLASSIC INVESTMENTS INC., the Buyer, and to Buyer's heirs, personal representatives and assigns the following vehicle:
Year 1956, Make MASERATI, Model 300S, Vehicle Identification Number (VIN) 3067 Engine #3062 and all spare parts (including spare block and head etc) to have and to hold this motor vehicle forever.
The car is available for inspection at Redline Restoration, 2316 Fairfield Ave, Black Rock, Connecticut. The... contacts are Bruce and Colton Amster. The car has about four (4) weeks' worth of detail work to be done....
A deposit of $50, 000 USD (fifty thousand U.S. dollars) will be bank wired to seller's account upon signing of this agreement by both parties. This deposit becomes non-refundable after two (2) weeks of due diligence. The remainder of $3, 250, 000 USD (three million two hundred fifty thousand U.S. dollars) will be due four (4) weeks from date of signing. The buyer has the right to withhold $100, 000 USD (one hundred thousand U.S. dollars) from final payment to ...