Opinion
CIVIL ACTION NO. 02-6591
May 20, 2004
MEMORANDUM
I. INTRODUCTION
Plaintiffs Inna Rotshteyn and Eugene Stone have filed a wrongful death action arising out of an October 5, 2001 accident which allegedly occurred while decedent Mikhail Rotshteyn was operating a downstacking machine manufactured by Agnati, S.p.A. in the scope of his employment at Acme Corrugated Box Company. Plaintiffs allege that United was the exclusive distributor of Agnati products in the United States under its "Strategic Alliance Agreement" with Agnati at the time of the accident and is therefore liable for strict products liability and breach of warranty in connection with the downstacker under Restatement (Second) of Torts Section 402 A. Plaintiffs have also asserted a negligence claim against United, claiming it had a duty to install electrical sensors or other types of safety devices along with the downstacker components Acme provided. Presently before me is defendant's motion for summary judgment. For the reasons stated below I will grant defendant's motion as to the strict liability and breach of warranty claims and will deny defendant's motion as to plaintiffs' negligence claim.
II. BACKGROUND
On October 5, 2001, Mikhail Rotshteyn, a general maintenance mechanic for Acme was killed in a workplace accident, allegedly while cleaning a hydraulic oil leak inside a downstacking machine manufactured by Agnati. Acme is alleged to have purchased the downstacker on the used equipment market from Jet Corr, Inc. in Atlanta. Defendant United Container Machinery alleges it was hired to assist in the electrical installation of the previously used Agnati downstacking machine at Acme. Defendant further asserts it was not involved with the design, manufacture or sale of the subject downstacking unit and that it was not hired to provide any type of safety analysis, engineering analysis, design opinion or any related evaluation or advice concerning the downstacker's safety. Plaintiffs assert that United was the exclusive distributor of Agnati products in the United States under its "Strategic Alliance Agreement" with Agnati at the time of the accident. The agreement is dated October 22, 1999. Plaintiffs further allege that in addition to installing the subject downstacker, defendant also supplied necessary parts for its installation and agreed to provide training for the new equipment.III. STANDARD FOR SUMMARY JUDGMENT
Federal Rule of Civil Procedure 56(c) provides that summary judgment is appropriate if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." The Supreme Court has recognized that the moving party "bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions . . . which it believes demonstrate the absence of a genuine issue of material fact."Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). After the moving party has filed a properly supported motion, the burden shifts to the nonmoving party to "set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). The nonmoving party may not rest upon the mere allegations or denials of the party's pleading.See Celotex, 477 U.S. at 324.
I must determine whether any genuine issue of material fact exists. An issue is "material" only if the dispute over facts "might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 248 (1986). If the record taken as a whole in a light most favorable to the nonmoving party, "could not lead a rational trier of fact to find for the nonmoving party, there is no `genuine issue for trial.'" Matsushita Elec. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986) (citation omitted). If the evidence for the nonmoving party is merely colorable, or is not significantly probative, summary judgment may be granted. Anderson. 477 U.S. at 249-50 (citations omitted).
I. STRICT LIABILITY AND BREACH OF WARRANTY
Strict products liability does not extend to mere installers of defective products. Malloy v. Doty Container, 820 F. Supp. 217, 222 (E.D. Pa. 1993). Restatement (Second) of Torts Section 402A, which has been adopted by Pennsylvania, states that:
(1) One who sells any product in a defective condition unreasonably dangerous to the seller or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if
(a) the seller is engaged in the business of selling such a product, and
(b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.
(2) The rule stated in Subsection (1) applies although
(a) the seller has exercised all possible care in the preparation and sale of his product, and
(b) the user or consumer has not bought the product from or entered into any contractual relation with the seller.
Comment f to Section 402A further explains that the section "applies to any manufacturer of such a product, to any wholesale or retail dealer or distributor. . . . It is not necessary that the seller be engaged solely in the business of selling such products." See also. Malloy v. Doty Conveyor, 820 F. Supp. 217, 220 (E.D. Pa. 1993). quoting Burch v. Sears, Roebuck Co., 467 A.2d 615, 621 ( Pa. Super. 1983) ("seller" includes "all suppliers of a defective product in the chain of distribution, whether retailers, partmakers, assemblers, owners, sellers, lessors or any other relevant category"). Although defendant asserts it was only hired to install the downstacking machine in question, plaintiffs assert that defendant was, in fact, a distributor of Agnati products and is therefore strictly liable for installing a defective product.
Plaintiff argues that although defendant was not a seller, strict liability should extend to defendant because "(1) a proposal was submitted on behalf of `United Agnati,' and . . . (2) the installation was conducted during United's partnership with Agnati S.p.A. whereby both parties mutually promised to be eachother's co-designer, co-manufacturer, and co-marketer of equipment, parts and services for the global corrugated box industry. . . ." (Pl.'s Br. in Opp. to Mot. for S.J. at 3). However, for Section 402A liability to attach, there be some nexus between the product sold, manufactured or distributed and the injury. Section 402A limits liability to "[o]ne who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property . . . for physical harm thereby caused to the ultimate user or consumer." (Emphasis added). "The imposition of strict products liability under § 402A requires that the defendant be in the chain of distribution of the defective product . . . to place the burden for compensating injuries on those who can control the defect and spread its costs through pricing."Malloy, 820 F. Supp. at 220. citing Burch v. Sears, Roebuck Co., 467 A.2d 615, 621 (Pa.Super. 1983).
Plaintiffs have not produced evidence to show that the particular downstacker that injured decedent was sold, manufactured, or distributed by defendant. The machine was sold to Acme on the used equipment market by Jet Corr, a third party. Plaintiffs have produced no evidence to show that defendant was involved in brokering the transaction between Acme and Jet Corr in any way. Further, although defendant's agreement with Agnati may allow for liability to attach with regard to downstackers manufactured during the course of their agreement, plaintiffs have not alleged that the downstacker in question was manufactured during the time period when defendant had agreed to be "co-designer, co-manufacturer, and co-marketer" of Agnati equipment.
To allow strict liability to attach here, where defendant had no involvement with the sale, manufacture or distribution of the downstacker in question, would do nothing to further the policy behind strict liability. There is nothing defendant could have done to ameliorate any design defect or failure to warn while this downstacker was in the chain of distribution. Defendant's only involvement with this machine was after it was purchased. The justification for strict liability "`has been said to be that a seller . . . has undertaken and assumed a special responsibility' toward the user, that the public has the right to `rely upon the seller, that reputable sellers will stand behind their goods,' and that the proper persons to afford protection to consumers `are those who market the products.'"Tracey v. Winchester Repeating Arms Co., 745 F. Supp. 1099, 1108 (E.D. Pa., 1990) quoting Rest. (Second) of Torts § 402A cmt. c. Defendant assumed no such special responsibility here as it was not a seller, manufacturer or distributor of the equipment at issue and it is therefore not the proper person to afford protection to plaintiffs under a theory of strict liability. Another way of saying this is that "[a]bsent an element of causation, there can be no liability under § 402A" and because there is no nexus between the manufacture, sale or distribution of this downstacker and defendant, it is neither socially nor economically expedient to impose strict liability here.Tracey, 745 F. Supp. at 1108. I will therefore grant summary judgment in favor of defendant on the issues of strict liability and breach of warranty.
Defendant is not liable under a breach of warranty theory because 13 Pa. Cons. Stat. Section 2318 applies only to sellers.
The warranty of a seller whether express or implied extends to any natural person who is in the family or household of his buyer or who is a guest in his home if it is reasonable to expect that such person may use, consume or be affected by the goods and who is injured in person by breach of the warranty. A seller may not exclude or limit the operation of this section.13 Pa. Cons. Stat. § 2318 (emphasis added). See also Blewitt v. Man Roland, Inc. 168 F. Supp.2d 466, 469 (E.D. Pa. 2001).
II. NEGLIGENCE
Plaintiffs have provided sufficient evidence to raise a genuine issue of material fact as to whether defendants undertook a duty to do more than merely assist with the electrical installation of the downstacking unit and therefore whether defendant could be liable in negligence to plaintiffs. "At a minimum, a defendant must be found to owe a duty of care before it can be held responsible for a failure to exercise that duty reasonably."Sacks v. Thomas Jefferson Univ. Hosp., 684 F. Supp. 858, 859 (E.D. Pa. 1988) (citations omitted). "[I]n order for liability to be imposed upon the actor, he must specifically have undertaken to perform the task that he is charged with having performed negligently, for without the actual assumption of the undertaking there can be no correlative legal duty to perform that undertaking carefully."Blewitt v. Man Roland, Inc., 168 F. Supp.2d 466, 469-70 (E.D. Pa. 2001), citing Restatement (Second) of Torts, § 324A. Section 324A of the Restatement (Second) of Torts states:
One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to protect his undertaking, if
(a) his failure to exercise reasonable care increases the risk of such harm, or
(b) he has undertaken to perform a duty owed by the other to the third person, or
(c) the harm is suffered because of reliance of the other or the third person upon the undertaking.
Defendant argues, that it was hired merely to assist with the electrical installation of the downstacking unit and that it was not hired to do any work with respect to safety issues in connection with the downstacking unit. To support its assertion, defendant cites to the affidavit of Douglas Thayer, a United employee sent to Acme to assist with the installation of the downstacking equipment. Thayer explains,
"As part of my job responsibilities at United Container Machinery, I would advise a customer if I saw there were mechanical or electrical parts that were missing or required replacement. It is my understanding that my job duties did not include suggesting additional safety mechanisms or safety devices for a corrugator, including a downstacker, or to provide advice about warning signs."
(United Mot. for S.J. Ex. B). He also stated that "[d]uring the installation of the Acme downstacking machine, [he] was never asked any advice regarding the safety of the machine." Id. Although Thayer was not equipped to provide safety recommendations and believed he was not required to suggest additional safety mechanisms for the downstacker, it is not clear from his affidavit that defendant never undertook to provide such services. Unlike defendant Klos Construction, Inc., who produced a written agreement with Acme stating that it was only to "supply the labor, material, parts and knowledge required to mechanically install two (2) Agnati Corrugators," defendant has not produced conclusive evidence of the terms of its agreement with Acme.
Plaintiffs argue that defendant's agreement with Acme included addressing safety issues in connection with the downstacking unit at Acme in addition to the electrical installation of the machinery. To support their argument, they have supplied an email from Mark Schlageter at United Container to someone named Michael at Agnati which explains, in part, "I wish to review the machinery [purchased from Jet Corr] with Tom Lebonetti[, plant manager at Acme,] and make suggestions on what may be needed to bring the machines into a more modern condition." (Pl.'s Repl. in Opp. to United Mot. for S.J. Ex. E) (emphasis added). The email also states "[i]f you have any suggestions about the machinery, improvements, or training, please let me know as well."Id. (emphasis added). Although the email does not specifically refer to safety improvements, updates or training, taken in the light most favorable to plaintiff, the text of this message shows that defendant understood its job at Acme included more than the mere installation of the downstacker. Defendant therefore may have undertaken a duty to ensure that the Acme downstacker would be updated with any safety equipment or other improvements added to later models of Agnati downstackers. Without additional evidence to demonstrate that defendant's arrangements with Acme did not include the provision of safety recommendations in its advice about what components might be needed to modernize the corrugating equipment, the email from Schlageter is enough to create a material issue of fact as to whether defendant owed a duty to ensure the downstacker was upgraded to include Agnati's current safety precautions.
In further support of their argument, plaintiffs also have submitted an "Installation and Training Proposal" from "United Agnati" to Acme as evidence that defendant agreed to do more than merely supervise installation of the downstacker. (Pl.'s Repl. in Opp. to United Mot. for S.J. Ex. F). The proposal includes references to safety training for all aspects of the Agnati corrugating equipment. It is not clear, however, whether Acme ever accepted "United Agnati's" proposal. Plaintiffs refer to an affidavit from Robert Cohen, president of Acme in support of their argument that "such a proposal was accepted by Acme, and therefore, United's failure to warn Acme of the dangers involved with an unguarded machine renders them negligent." (Pl.'s Br. in Opp. to United Mot. for S.J. at 5). However, no such affidavit was ever produced and defendants allege this is because the proposal submitted by United was never accepted by Acme and plaintiffs never secured an affidavit from Cohen. Despite this, the email from Schlageter, is sufficient evidence to raise a question about defendant's position that it was hired only to install the downstacker and not to provide safety inspection or consulting services even without evidence that the safety training proposal was accepted by Acme. I will therefore deny defendant's motion for summary judgment on the issue of negligence.
If this is indeed the case, I am disturbed by plaintiffs' misrepresentation to the Court.
ORDER
AND NOW, this ___ day of May 2004, after considering defendant United Container Machinery's motion for summary judgment and all responses thereto, it is hereby ORDERED that defendant's motion is GRANTED IN PART and DENIED IN PART. Accordingly:
1) the Motion is GRANTED as to Counts I and II of the Complaint, and judgment is hereby entered in favor of Count II is hereby favor of defendant United Container Machinery and against plaintiffs Inna Rotshteyn and Eugene Stone on the issues of strict liability and breach of warranty.
2) in all other respects the motion is DENIED.