Alitalia v. Arrow Trucking Co.
| Decision Date | 29 September 1997 |
| Docket Number | No. CIV-95-2007-PHX-ROS.,CIV-95-2007-PHX-ROS. |
| Parties | ALITALIA, a foreign corporation; Assicurazioni Generali, S.p.A., a foreign corporation, Plaintiffs, v. ARROW TRUCKING COMPANY, an Oklahoma corporation; Dynair Tech of Arizona, Inc., an Arizona corporation, Defendants. ARROW TRUCKING COMPANY, an Oklahoma corporation, Cross-Claimant, v. DYNAIR Tech of Arizona, Inc., an Arizona corporation, Cross-Defendant. |
| Court | U.S. District Court — District of Arizona |
Gregory P. Gillis, Michael J. Frazelle, Ridenour Swenson Cleere & Evans, Pheonix, AZ, Emilia Gabriele, Pino & Associates, White Plains, NY, for Alitalia, Assicurazioni Generali, S.P.A.
David W. Counce, Law Offices of David W. Counce, Pheonix, AZ, for Dynair Tech of Arizona, Inc.
Jean Mahoney Gardner, Jeffrey Scott Rogoff, Schindel, Farman & Lipsius, New York City, Elizabeth Savoini Fitch, Turley, Swan & Childers PC, Phoenix, AZ, for Arrow Trucking Co.
BACKGROUND
On September 22, 1995, Plaintiffs Alitalia and Assicurazioni Generali, S.p.A. ("Generali"), foreign corporations organized and existing under the laws of Italy, commenced the instant action against Defendants Arrow Trucking Company ("Arrow"), an Oklahoma corporation, and Dynair Tech of Arizona, Inc. ("Dynair"), an Arizona corporation.1 Plaintiffs' allegations are as follows.
On some unspecified date, Alitalia entered into a 30-day lease agreement with American Airlines in which Alitalia leased a CF6-80C engine (the "engine"). (Compl. ¶ 9.) Under the terms of the lease agreement, Alitalia was required to return the leased engine in as good of an operating condition as when it was delivered to Alitalia. Id. ¶ 11. Alitalia was also required to pay leasing costs, on a per diem basis, for any extension beyond the agreed upon lease term. Id. ¶ 12.
On an unspecified date, the engine was installed on an Alitalia aircraft and flown to the Dynair facility at Sky Harbor International Airport in Phoenix, Arizona. Id. ¶ 13. The engine was removed from the Alitalia aircraft on November 5, 1994. Id. ¶ 14. Arrangements were made by and between Dynair and Arrow to transport the engine by road to American Airlines's engine facility in Tulsa, Oklahoma. Id. ¶ 15. On November 5, 1994, the engine was loaded onto a truck owned, operated, maintained, managed, and controlled by Arrow and/or Dynair and departed the Dynair facility after routing instructions were provided to the truck operator by Dynair. Id. ¶ 16. The truck carrying the engine left the Dynair facility and entered the airport road system on the route suggested by Dynair. Id. ¶ 17. After traveling approximately 1000 meters, the truck attempted to pass under a road access bridge and the engine collided with the overpass. Id. The engine was returned to the Dynair facility during which the damage to the engine was assessed and the engine was rerouted on a proper route out of the airport to Tulsa. Id. ¶ 18.
The engine was insured by an insurance policy issued by Generali to Alitalia. Id. ¶ 10. Generali incurred the costs of repair of the engine under the insurance policy. Id. ¶ 19. Generali paid $626,373.00 for the repairs. Id. Alitalia also paid the $10,000.00 deductible under the insurance policy. Id. ¶ 20. Alitalia also incurred additional leasing expenses for the engine during the time that the engine was being repaired.2 Id. ¶ 21. Alitalia incurred $391,000.00 in additional leasing expenses.3 Id.
Plaintiffs alleged causes of action based on negligence, breach of contract, and the Carmack Amendment to the Interstate Commerce Act.4
On October 31, 1995, Defendant Arrow filed a cross-claim against Defendant Dynair seeking indemnification or contribution. Defendant Arrow alleged that any injury or damage sustained as alleged in Plaintiffs' Complaint was caused solely by the negligence of Defendant Dynair without any negligence or culpable conduct on the part of Defendant Arrow.
On February 5, 1997, Defendant Arrow moved for partial summary judgment on the issue of consequential damages. On March 13, 1997, Plaintiffs cross-moved for partial summary judgment against Defendant Arrow.
On February 19, 1997, Defendant Dynair moved for summary judgment against Plaintiffs' Complaint and Defendant Arrow's Cross Claim. On March 19, 1997, Defendant Arrow cross-moved for summary judgment against Defendant Dynair.
Oral argument was set on the cross-motions for summary judgment on October 6, 1997 and November 3, 1997.5
Summary judgment is appropriate when the movant shows "there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c); California Architectural Building Products, Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir.1987), cert. denied, 484 U.S. 1006, 108 S.Ct. 698, 98 L.Ed.2d 650 (1988). There is a genuine issue of material fact "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The moving party bears the burden of demonstrating that no material fact is in dispute. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). Courts must view the evidence in the light most favorable to the nonmoving party and draw any reasonable inferences in the nonmoving party's favor. Provenz v. Miller, 102 F.3d 1478, 1483 (9th Cir.1996). However, "an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, ... the adverse party's response ... must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e).
Arrow seeks partial summary judgment against Plaintiffs' request for consequential or special damages. Arrow notes that Alitalia is seeking to recover the additional leasing expenses for the engine incurred during the time that the engine was being repaired. (Compl. ¶ 21.) Arrow contends that Plaintiffs are limited to recover the actual damage to the engine in accordance with the Carmack Amendment to the Interstate Commerce Act. Arrow claims that neither Arrow's truck driver, Danny Goynes, nor Arrow's dispatcher, Steven Savage, were informed any time prior to the transportation of the engine that the engine was owned by American Airlines and leased to Alitalia. (Goynes Dep. at 49, 55; Savage Dep. at 17.) Arrow claims that even Robert Perley of McDonnell Douglas Corporation, who engaged Arrow to transport the engine, did not know that the engine was leased by Alitalia. (Perley Dep. at 51.) Arrow notes that Plaintiffs stated in their response to question No. 20 of Arrow's Initial Request for Interrogatories, "The Plaintiffs are unaware of any particular reason why Arrow should have known about Alitalia's lease with American Airlines." (Arrow's SOF Ex. E.)
In response, Plaintiffs contend that a question of fact remains regarding the foreseeability of Alitalia's additional leasing expenses. In support, Plaintiffs assert that: (1) engines similar to the engine involved in the collision are valued as much as $7 million; (2) the value of engines is self-evident; (3) when the damage to the engine first occurred, the damage was estimated at $1.5 to $2 million; (4) the likelihood of extensive damages due to Arrow's negligence in transporting the engine existed from the outset of the accident because of the inherently high value of the engine; (5) it is common practice in the airline industry that engines are leased; (6) it is completely reasonable to assume that the time spent to repair the damaged engine would result in increased damages to Alitalia through the extension of the lease; (7) it is reasonable to conclude that Arrow had actual knowledge that Alitalia was leasing the engine from American Airlines; (8) the shipping document prepared by Dynair and provided to Arrow on the day of shipment stated, "Removed from Alitalia MD-11 FUS468, reg No. I-DUPA;" and (9) it is reasonable to infer that Arrow had actual notice that the engine was leased and that additional damages would occur if the engine was damaged, which would require an extension of the lease period. Plaintiffs argue that foreseeability is a factual question for the jury. Plaintiffs also claim that the accurate measure of damages in this case is Alitalia's out-of-pocket expenses resulting from the damage to the engine. (Pls.' Mem. Opp'n Part. Summ. J. at 6-7.)
In reply, Arrow contends that the evidence demonstrates that there was no reason for Arrow to foresee that a delay in delivery would lead to a lease extension costing Alitalia $3,400 per day. (Arrow's Reply Mem. at 3.) Arrow notes that Plaintiffs cannot point to any admissible evidence showing that anyone from Arrow was informed that the engine was leased by Alitalia. Id. Arrow reasserts that at no time prior to transportation of the engine was anyone acting on behalf of Arrow informed that the engine was owned by American Airlines and leased to Alitalia. Id. Arrow notes that Plaintiffs do not contend that Arrow was informed about the economic consequences of failing to make a timely and satisfactory delivery. Id. Arrow asserts that Plaintiffs do not even allege that Robert Perley of McDonnell Douglas, who hired Arrow, knew about the Alitalia-American Airlines lease. Id. Arrow reasserts that Plaintiffs admitted in their Response to Arrow's Initial Request for Interrogatories that they were unaware of any particular reason why Arrow should have known about Alitalia's lease with American Airlines. Id. Arrow contends that Plaintiffs' reliance upon the fact that jet engines are expensive, it is a common practice to lease engines, and that Dynair's shipping ticket indicates engine was removed from an Alitalia airplane is irrelevant and inadequate in demonstrating...
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