Allstate Ins. Co. v. Icon Health & Fitness, Inc.

• Decision Date: 16 March 2005
• Docket Number: No. CIV. 02-40242.,CIV. 02-40242.
• Citation: 361 F.Supp.2d 673
• Parties: ALLSTATE INSURANCE COMPANY, a foreign corporation as Subrogee of Denise Parker, Plaintiff, v. ICON HEALTH & FITNESS, INC., a foreign corporation, Defendant.
• Court: U.S. District Court — Eastern District of Michigan

361 F.Supp.2d 673

ALLSTATE INSURANCE COMPANY, a foreign corporation as Subrogee of Denise Parker, Plaintiff, v. ICON HEALTH & FITNESS, INC., a foreign corporation, Defendant.

No. CIV. 02-40242.

United States District Court, E.D. Michigan, Southern Division.

March 16, 2005.

Alan B. McMaster, Grotefeld & Denenberg, Bingham Farms, MI, for Allstate Insurance Company, Plaintiff.

Elizabeth A. Downey, Elizabeth A. Downey Assoc., Bloomfield Hills, MI, for Icon Health and Fitness, Incorporated, Defendant.

ORDER DENYING DEFENDANT'S MOTIONS FOR SUMMARY JUDGMENT

GADOLA, District Judge.

I. INTRODUCTION

Before the Court are five separate motions for summary judgment brought by Defendant: (1) on the claims for failure to warn, (2) on the claims for design defects, (3) on the claims of manufacturing defects, (4) on the claim for breach of implied warranty, and (5) on the claims under the Michigan Consumer Protection Act. The Court held a hearing on these motions on November 8, 2004. For the reasons stated below, the Court will deny each of these motions.

II. BACKGROUND

This diversity action involving products liability arises out of a fire that occurred at Denise Parker's property. As a result of the fire, Plaintiff Allstate Insurance Company ("Allstate") paid Ms. Parker $170,165.31, and Ms. Parker had a deductible of $500.00. Ms. Parker subrogated all her rights and claims from the incident to Allstate. Allstate alleges that the fire started because of a defect in a treadmill and therefore brings these claims against Icon Health and Fitness, Incorporated ("Icon"), the alleged designer and manufacturer of the treadmill. The treadmill was purchased by Ms. Parker in 1996. Plaintiff Allstate brings this action, seeking $170,665.31 in damages, plus costs and interest. Defendant Icon argues that the treadmill was not defective and that the fire started in the ceiling, not in the treadmill.

The Court notes that the parties previously appeared for a final pre-trial conference on May 12, 2004. At the conference it was determined that additional discovery and dispositive motions would be appropriate. Defendant subsequently filed these five separate motions that are presently before the Court.

III. LEGAL STANDARD FOR SUMMARY JUDGMENT

Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment "shall be rendered forthwith 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 judgment as a matter of law." Fed.R.Civ.P. 56(c). Summary judgment is appropriate if the moving party demonstrates that there is no genuine issue of material fact regarding the existence of an essential element of the nonmoving party's case on which the nonmoving party would bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Martin v. Ohio Turnpike Comm'n, 968 F.2d 606, 608 (6th Cir.1992).

In considering a motion for summary judgment, the Court must view the facts and draw all reasonable inferences in a light most favorable to the nonmoving party. 60 Ivy St. Corp. v. Alexander, 822 F.2d 1432, 1435 (6th Cir.1987). The Court is not required or permitted, however, to judge the evidence or make findings of fact. Id. at 1435-36. The moving party has the burden of showing conclusively that no genuine issue of material fact exists. Id. at 1435.

A fact is "material" for purposes of summary judgment if proof of that fact would have the effect of establishing or refuting an essential element of the cause of action or a defense advanced by the parties. Kendall v. Hoover Co., 751 F.2d 171, 174 (6th Cir.1984). A dispute over a material fact is genuine "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, 91 L.Ed.2d 202 (1986). Accordingly, when a reasonable jury could not find that the nonmoving party is entitled to a verdict, there is no genuine issue for trial and summary judgment is appropriate. Id.; Feliciano v. City of Cleveland, 988 F.2d 649, 654 (6th Cir.1993).

Once the moving party carries the initial burden of demonstrating that there are no genuine issues of material fact in dispute, the burden shifts to the nonmoving party to present specific facts to prove that there is a genuine issue for trial. Anderson, 477 U.S. at 256, 106 S.Ct. 2505. To create a genuine issue of material fact, the nonmoving party must present more than just some evidence of a disputed issue. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). As the United States Supreme Court has stated, "there is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party. If the [nonmoving party's] evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson, 477 U.S. at 249-50, 106 S.Ct. 2505 (citations omitted); see Celotex, 477 U.S. at 322-23, 106 S.Ct. 2548; Matsushita, 475 U.S. at 586-87, 106 S.Ct. 1348.

Consequently, the nonmoving party must do more than raise some doubt as to the existence of a fact; the nonmoving party must produce evidence that would be sufficient to require submission of the issue to the jury. Lucas v. Leaseway Multi Transp. Serv., Inc., 738 F.Supp. 214, 217 (E.D.Mich.1990) (Gadola, J.), aff'd, 929 F.2d 701, 1991 WL 49687 (6th Cir.1991). "The mere existence of a scintilla of evidence in support of the plaintiff's position will be insufficient; there must be evidence on which the jury could reasonably find for the plaintiff." Anderson, 477 U.S. at 252, 106 S.Ct. 2505; see Cox v. Ky. Dep't of Transp., 53 F.3d 146, 150 (6th Cir.1995).

IV. ANALYSIS

A. Failure to Warn

The parties have stipulated to dismiss this claim with prejudice, accordingly the Court need not address the motion regarding this issue. See docket entries 77 & 78.

B. Design Defect

Michigan law provides that:

In a product liability action brought against a manufacturer or seller for harm allegedly caused by a production defect¹, the manufacturer or seller is not liable unless the plaintiff establishes that [1] the product was not reasonably safe at the time the specific unit of the product left the control of the manufacturer or seller and that, [2] according to generally accepted production practices at the time the specific unit of the product left the control of the manufacturer or seller, a practical and technically feasible alternative production practice was available that would have prevented the harm without significantly impairing the usefulness or desirability of the product to users and without creating equal or greater risk of harm to others.

Mich. Comp. Laws 600.2946(2). Michigan law also requires "that a prima facie case for products liability requires proof of a causal connection between an established defect and injury." Skinner v. Square D Co., 516 N.W.2d 475, 478, 445 Mich. 153, 159 (1994) (citation omitted). The Michigan Supreme Court has stated that in establishing proximate cause, "[i]t is enough that the plaintiff establishes a logical sequence of cause and effect, notwithstanding the existence of other plausible theories, although other plausible theories may also have evidentiary support." Mulholland v. DEC Int'l Corp., 432 Mich. 395, 416, 443 N.W.2d 340, 349 (Mich.1989).

The parties have not been able to discover the precise design used in the treadmill in question. In particular, the design of the "PWM control board" in the treadmill was done by a third party and the parties have been unable to obtain a clear copy of the schematics for the board. At the hearing held on these motions, both parties unconditionally waived additional discovery. Even without the specific design in evidence, Plaintiff has presented circumstantial evidence to establish a design defect. As the Michigan Supreme Court has noted, "[i]t is within the province of the jury to infer the existence of a defective condition from circumstantial evidence alone." Caldwell v. Fox, 394 Mich. 401, 410, 231 N.W.2d 46 (1975).

In this case, Plaintiff has provided an expert who claims that "the fire had originated at ... these power resistors" in the treadmill. Lindsay Dep. at 140. That expert also provided an affidavit stating that the evidence "does not provide a reliable basis for a conclusion [that] there were safety devices for the PWM board to prevent an overheating condition." Lindsay Aff. at ¶ 10. The expert also opined that "this defect existed at the time the treadmill left the control of the manufacturer." Id. at ¶ 12. A jury could find this alleged omission of safety devices to constitute a design defect.

There is also evidence from which a jury could infer that the defect caused a fire and the resulting damage. See id. at ¶ 13. For example, another of Plaintiff's experts claims that after the fire, "[u]nderneath the front of the treadmill, the carpet was gone," which constitutes "more evidence that the fire originated at the front of the treadmill." Mihalek Dep. at 67. Plaintiff also claims that this is consistent with the homeowner's testimony that she saw the treadmill on fire. Parker Dep. at 15. While Defendant may rebut this evidence at trial, it is not for this Court to make a factual determination about the existence of a safety device or the origin of the fire. Therefore, the Court will deny Defendant's motion for summary judgment on this issue.

E. Manufacturing Defect

Under Michigan law, to establish a claim for a manufacturing defect, a plaintiff must show (1) the product was defectively manufactured, (2) the product reached the customer in the same condition as when it left the manufacturer, and (3) the defect was a proximate cause of the...