Crompton Greaves, Ltd. v. Shippers Stevedoring Co.

• Citation: 921 F.Supp.2d 697
• Decision Date: 05 February 2013
• Docket Number: Civil Action No. H–08–1774.
• Parties: CROMPTON GREAVES, LTD., Plaintiff, v. SHIPPERS STEVEDORING COMPANY, Defendant.
• Court: U.S. District Court — Southern District of Texas

921 F.Supp.2d 697

CROMPTON GREAVES, LTD., Plaintiff,

v.SHIPPERS STEVEDORING COMPANY, Defendant.

Civil Action No. H–08–1774.

United States District Court,

S.D. Texas,

Houston Division.

Feb. 5, 2013.

Dana Keith Martin, Daniela Oliveira, Hill Rivkins, Houston, TX, Keith B. Dalen, Hill Rivkins & Hayden, New York, NY, for Plaintiff.

Bernard H. Ticer, Baldwin Haspel et al., New Orleans, LA, Michael J. Wray, Andrew M. Stakelum, Legge Farrow Kimmitt et al., Houston, TX, for Defendant.

MEMORANDUM AND OPINION ENTERING FINDINGS OF FACT AND CONCLUSIONS OF LAW

LEE H. ROSENTHAL, District Judge.

This is a dispute over responsibility for damage to a large power transformer. The plaintiff, Crompton Greaves, Ltd. designs and manufactures power transformers in India. Tucson Electric Power (TEP), an electric utility, contracted with Crompton Greaves, through its subsidiary Pauwels Americas, to build and ship to the United States several power transformers. In March 2007, one of these transformers—referred to here as the “South Loop Transformer” or “the Transformer”—arrived by ocean vessel at the Port of Houston and was discharged. Shippers Stevedoring, a Texas corporation, provided stevedoring and terminal services. When the South Loop Transformer arrived at its final destination in Arizona, Crompton Greaves discovered that it was damaged and inoperable.

Crompton Greaves alleges that the South Loop Transformer was damaged due to Shippers Stevedoring's negligence and that Shippers Stevedoring acted as Crompton Greaves's bailee. Shippers Stevedoring contends that at least some of Crompton Greaves's claims are barred by limitations under the Carriage of Goods by Sea Act (COGSA). Shippers Stevedoring denies that it acted as Crompton Greaves's bailee and, alternatively, argues that Crompton Greaves failed to make a prima facie case of bailment liability. Shippers Stevedoring also argues that Crompton Greaves has not proven that Shippers Stevedoring's negligence caused the Transformer's damage.

This court held a seven-day bench trial. The parties presented fact and expert testimony and exhibits on the purchase, design, construction, transportation, delivery, inspection, and repair of the South Loop Transformer. Based on the testimony and exhibits, the parties' oral and written legal arguments, and the relevant law, this court finds and concludes as follows:

• Crompton Greaves's claims against Shippers Stevedoring are barred, in part, by COGSA's one-year limitations period;

• Crompton Greaves failed to make a prima facie showing of Shippers Stevedoring's liability as a bailee; and

• Shippers Stevedoring has no liability to Crompton Greaves for the damage to the Transformer.

The detailed reasons for these rulings are set out below.¹

I. Findings of FactA. The Evidence Presented

1. The Witnesses

In the bench trial, the court heard trial testimony from numerous expert and fact witnesses. The subject of their testimony is summarized below.

• Sandeep Chakravarty. Chakravarty has a B.S. in electrical engineering and an M.B.A. In 2007, Chakravarty was the general manager of the Crompton Greaves Bhopal, India plant. At the time of trial, he was responsible for Crompton Greaves's transformer sales to Europe and the Americas. (Nov. 29, 2011 Trial Excerpt at 36). Chakravarty testified about the South Loop Transformer's design, manufacturing, and transportation, and about the use of shock recorders.

• Viswanathan Shivakumar. Shivakumar is the operations head for the Crompton Greaves Bhopal, India plant. In 2006 and 2007, he was the production manager. (Docket Entry No. 204 at 441). Shivakumar has a bachelor's degree in electrical engineering. ( Id.). He began working at Crompton Greaves in 1979 and has worked at the Bhopal plant since 2002. ( Id. at 22–23). Shivakumar testified primarily about the manufacture of the South Loop Transformer, the attachment of a shock recorder to the Transformer, and the Transformer's transportation within India before shipment to the Port of Houston.

• Gautam Mazumder. Mazumder is the senior manager of customer services at the Bhopal plant. (Docket Entry No. 204 at 631). He testified about inspecting the South Loop Transformer around March 13, 2013 and when it arrived at TEP in Arizona.

• Karl E. Wolff. Wolff was called by Crompton Greaves as an expert witness. Wolff has worked as a carman apprentice, loading specialist, assistant car foreman, and lead car inspector for the Southern Pacific Railroad, where he worked with shippers on large and unusual loads. (Docket Entry No. 208 at 718–20, 726). Part of his responsibility as a railroad inspector was to ensure that cargo was properly placed on railcars. ( Id. at 720). Wolff is also a qualified crane operator. ( Id. at 719–20). Wolff testified about potential causes of damage to the Transformer on March 7, 13, and 31, 2007 and about custom and practice in the transportation industry.

• David Alan Hullender. Hullender was called by Crompton Greaves to testify as an expert witness on interpreting the shock recorder data. Hullender is a professor of mechanical engineering at University of Texas at Arlington. (Docket Entry 189 at 4). He has bachelor and master of science degrees in mechanical engineering and a Ph.D. in mechanical engineering. ( Id.). Hullender has expertise in testing machinery for vibration issues, stress levels, and force levels and in developing computer models to test equipment design and reliability. ( Id. at 4–5).

• Pravin Ghadi. Ghadi is an engineering head of the Crompton Greaves power group. (Docket Entry No. 211 at 773). He analyzes financial and commercial aspects of Crompton Greaves plants globally. Ghadi has a postgraduate degree in finance. ( Id.). He was hired by Crompton Greaves to work in corporate taxation, was promoted to the factory finance-manager position, and then became Pauwels Indonesia's CFO, ( Id. at 774–75). Ghadi testified primarily about Crompton Greaves's damages.

• Scott Anthony Butler. Butler is Shippers Stevedoring's terminal manager at the Barbours Cut Terminal. (Docket Entry No. 211 at 840). In March 2007, Butler was the assistant terminal manager at Barbours Cut, responsible for cargo movement, supervision of other employees, and yard duties. ( Id.). Butler testified about the Transformer's movement within the Terminal.

• Clarence Rego. In 2007, Rego was employed by VeriClaim as a marine surveyor. (Docket Entry No. 211 at 870). He oversaw the loading and unloading of ships and investigated claims for damaged vessels, tankers, and cargo. ( Id.). Rego was hired by Pauwels Americas to survey the South Loop Transformer's unloading from the vessel and its loading onto a railcar at the Barbours Cut Terminal. ( Id. at 871–72). He testified about his observations of the Transformer while it was located at the Barbours Cut Terminal.

• Darrel Harrelson. In March 2007, Harrelson was Shippers Stevedoring's equipment director. (Docket Entry No. 213 at 897). He was responsible for maintenance and logistics for all of Shippers Stevedoring's equipment, including its cranes. ( Id. at 898). At the time of trial, Harrelson had worked for Shippers Stevedoring for 37 years, beginning as a crane operator. ( Id. at 898). He testified about Shippers Stevedoring's crane-usage practices and about loading the Transformer onto the railcar.

• Derlin Marsh. March is the terminal manager at Shippers Stevedoring's Barbours Cut Terminal, a position he also held in 2007. He is responsible for supervising all of Shippers Stevedoring's operations at the Terminal. Marsh testified about the Transformer's movement within the Terminal and the relevant customs and practices at the Port of Houston.

• Edmund Francis Feloni. Feloni was called by Crompton Greaves to testify as an expert on transformer design and manufacturing and about the likely causes of the damage to the South Loop Transformer. He has a bachelor of science degree in electrical engineering. He specializes in power systems, including large transformers. (Docket Entry 190 at 154–55). He has worked for electrical utilities and currently consults on engineering, testing, and failure analysis primarily for government agencies, large utilities, industrial military facilities, and insurance companies. ( Id. at 155, 157). He has reviewed over a hundred transformers on damage and loss issues. ( Id. at 157).

• Robert G. Ganser. Ganser is a registered professional engineer working as a consultant on transformers. (Docket Entry No. 204 at 530–32). He received a bachelor of science degree in electrical engineering and an M.B.A. He has worked for several transformer manufacturing and repair companies on inspections and testing. ( Id. at 532–3). As a consultant, Ganser provides design and environmental impact review and root-cause failure analysis. ( Id. at 534–35). He was hired by TEP to inspect the South Loop Transformer after the damage was discovered. ( Id. at 531). Ganser testified for Shippers Stevedoring about his observations and about the likely causes of the Transformer damage.

• Bayles Brett Holliday. Holliday was called by Shippers Stevedoring as an expert on the shipping industry. Holiday has a bachelor of science degree. (Docket Entry No. 215 at 989). He has worked in various capacities in ports around the world, in both military and civilian terminal and stevedoring operations. ( Id. at 989–91). Holliday testified primarily about port customs and practices.

• Richard Mayne Bonyata. Bonyata testified as an expert for Shippers Stevedoring about interpreting shock recorder data and about the likely causes of the Transformer damage. He has a bachelor of science in electrical engineering and is a registered professional engineer. Bonyata works for McDowell Owens Engineering, specializing in failure analysis and forensic engineering. (Docket Entry No. 215 at 1074–75). He has an extensive background performing troubleshooting services for several companies. ( Id. at 1075–76).

The...