Fleck v. Gen. Motors LLC (In re Gen. Motors LLC)

• Decision Date: 30 December 2015
• Docket Number: 14–MC–2543 (JMF),14–MD–2543 (JMF)
• Citation: 154 F.Supp.3d 30
• Parties: In re: General Motors LLC Ignition Switch Litigation. This Document Relates To: Fleck, et al. v. General Motors LLC, 14-CV-8176.
• Court: U.S. District Court — Southern District of New York

154 F.Supp.3d 30

In re: General Motors LLC Ignition Switch Litigation. This Document Relates To: Fleck, et al. v. General Motors LLC, 14-CV-8176.

14–MD–2543 (JMF)

14–MC–2543 (JMF)

United States District Court, S.D. New York.

Signed December 30, 2015

OPINION AND ORDER

JESSE M. FURMAN, United States District Judge:

The first bellwether trial in this multi-district litigation (“MDL”), familiarity with which is presumed, involves claims brought by Plaintiff Robert Scheuer (“Plaintiff” or “Scheuer”) against General Motors LLC (“Defendant” or “New GM”) stemming from a May 28, 2014 car accident involving Scheuer's 2003 Saturn Ion. That car was manufactured by General Motors Corporation (“Old GM”)—which filed for bankruptcy in 2009, a bankruptcy from which New GM emerged. New GM now moves, pursuant to Rule 56 of the Federal Rules of Civil Procedure, for summary judgment on all of Scheuer's claims, contending, first, that he cannot show that an alleged ignition switch defect in the car caused or enhanced his injuries and, second, that all of his claims based solely on New GM's conduct—the only claims that could expose New GM to punitive damages—fail as a matter of law. (Docket No. 1810). For the following reasons, New GM's motion is almost entirely DENIED.

FACTUAL BACKGROUND

The following undisputed facts are taken from admissible evidence in the record and the parties' statements pursuant to Local Rule 56.1. Plaintiff, a resident of Oklahoma, purchased a 2003 Saturn Ion manufactured by Old GM in Nevada in the summer of 2003. (See Pl.'s Local Rule 56.1 Resp. Opp'n New GM's Statement Undisputed Material Facts & Statement Additional Material Disputed Facts (Docket No. 1880) (“Pl.'s 56.1 Statement”) ¶¶ 1-2; Third Am. Compl. (Docket No. 1696) (“TAC”) ¶ 9). On February 25, 2014, New GM notified the National Highway Safety Administration (“NHTSA”) of a potentially deadly defect in the ignition switches installed in many GM-brand vehicles, including the 2003 Saturn Ion, and New GM's determination to conduct a safety recall of the affected vehicles. (See Pl.'s 56.1 Statement ¶ 5; Affirmation R. Allan Pixton (Docket No. 1821) (“Pixton Decl.”), Ex. 3). The NHTSA letter stated that “[t]he ignition switch torque performance [in these vehicles] may not meet General Motors' specification. If the torque performance is not to specification, the ignition switch may unintentionally move from the ‘run’ position to the ‘accessory’ or ‘off’ position with a corresponding reduction or loss of power.” (Pixton Decl., Ex. 3, at 1).

In April and May 2014, Plaintiff received two recall notices from New GM. (See Pl.'s 56.1 Statement ¶¶ 12-15; Pixton Decl., Exs. 4-5). The notices advised Plaintiff that replacement parts were being made available and that, in the meantime, he should “remove all items from your key ring, leaving only the vehicle key. The key fob (if applicable) should also be removed from the key ring.” (Pixton Decl., Ex. 4). Following receipt of the May notice, Plaintiff called his local car dealership and was informed that replacement parts were not then available. (See Pl.'s 56.1 Statement ¶¶ 16-18). The dealership also reminded Plaintiff to take everything but his ignition switch key off his key ring, which Plaintiff did. (See id. ¶¶ 18-19). Plaintiff continued to drive the Saturn Ion. (See id. ¶¶ 19-20).

On May 28, 2014, Plaintiff was driving on a highway in Oklahoma when he was forced off the road by another car. (See id. ¶¶ 20-22). The precise sequence of what followed is heavily disputed, but Plaintiff's car ended up crashing head-on into two trees. (See id. ¶¶ 21-22). Plaintiff's frontal airbags, however, did not deploy. (See Decl. Robert C. Hilliard Supp. Pl.'s Mem. Law Opp'n New GM's Mot. Summ. J. (Docket No. 1882) (“Hilliard Decl.”), Ex. 14 (“Scheuer Dep.”), at 126). Shortly after the accident, Plaintiff's insurer, State Farm, “determined that the vehicle was a total loss,” and paid him a sum representing “the value of the vehicle.” (Mem. Law Supp. Pl.'s Mot. In Limine No. 4 (Docket No. 1712) (“Pl.'s Fourth MIL Mem.”) 4; see id ., Ex. 1). Thereafter, State Farm transferred title for the car to a salvage yard, and on September 22, 2014, the salvage yard destroyed the car. (See Pl.'s Fourth MIL Mem. 4; id. , Ex. 3; New GM's Combined Opp'n Pl.'s Mot. In Limine No. 4 (Docket No. 1816) 5). On October 10, 2014, Plaintiff filed this action against New GM, alleging that he suffered various injuries as a result of the airbag non-deployment in his crash and that the airbag non-deployment was a result of the widely publicized ignition switch defect. (Complaint, Fleck, et al. v. General Motors, LLC , No. 14–CV–8176 (JMF) (S.D.N.Y. Oct. 10, 2014), Docket No. 1; see also TAC ¶¶ 7–8). Plaintiff's case was consolidated with the MDL and eventually selected to be tried as the first of several “bellwether” cases. (See MDL Consolidated Order, Fleck , 14-CV-8176 (S.D.N.Y. Oct. 20, 2014), Docket No. 4; Order No. 25, 14–MD–2543, Docket No. 422; 14–MD–2543, Docket No. 590; 14–MD–2543, Docket No. 1217).

BANKRUPTCY PROCEEDINGS

Before turning to New GM's arguments for summary judgment, it is necessary to briefly summarize certain proceedings before the Honorable Robert E. Gerber, United States Bankruptcy Judge for the Southern District of New York, who presided over the bankruptcy of Old GM in 2009. After New GM's disclosure of the ignition switch defect in early 2014, many claims were filed against New GM—some alleging economic losses and some alleging personal injuries and wrongful deaths. In April and August 2014, New GM filed motions before the Bankruptcy Court alleging that many of those claims were barred by the 2009 Sale Order through which New GM assumed many of Old GM's assets and some of its liabilities. In April 2015, Judge Gerber ruled that many of the claims brought against New GM were in fact barred by the 2009 Sale Order. See In re Motors Liquidation Co. , 529 B.R. 510 (Bankr.S.D.N.Y.2015). In particular, he determined that New GM could be held liable for certain assumed liabilities of Old GM (namely, products liability claims that were included in the Sale Agreement), but distinguished between liability based on Old GM's conduct and liability for “claims based solely on any wrongful conduct its own part.” Id. at 583. A later Order implementing that opinion defined claims “based solely on New GM's own, independent, post-Closing acts or conduct” as “Independent Claims.” See In re Motors Liquidation Co. , 09–50026 (REG), Docket No. 13177 ¶ 4 (Bankr.S.D.N.Y. June 1, 2015).

The definition of “Independent Claims” reemerged as significant in Judge Gerber's recent opinion on punitive damages and “imputation.” See In re Motors Liquidation Co. , 541 B.R. 104 (Bankr.S.D.N.Y.2015) (“November Decision ”). There, Judge Gerber made two findings that bear on this bellwether trial. First, he determined that, as a matter of bankruptcy law, knowledge of Old GM personnel or knowledge of information contained in Old GM files could be imputed to New GM only to the extent that it could be shown, as a matter of non-bankruptcy law, that New GM actually had that knowledge (for example, through an Old GM employee who later became an employee of New GM). See November Decision at 108. Second, Judge Gerber ruled that claims for punitive damages could only be “based on New GM knowledge and conduct alone” because New GM did not assume liability for punitive damages under the Sale Agreement. See id. In light of Judge Gerber's decisions, there are three types of damages available to Plaintiff: (1) compensatory damages for products liability claims based on Old GM conduct, which were assumed by New GM in the 2009 Sale Agreement; (2) compensatory damages for “Independent Claims”—that is, claims based solely on New GM conduct (including any knowledge of Old GM properly imputed to New GM); and (3) punitive damages for “Independent Claims” (again, including any knowledge of Old GM properly imputed to New GM). In his Third Amended Complaint, Plaintiff pursues all three. (See TAC ¶¶ 418-29).

SUMMARY JUDGMENT STANDARDS

Summary judgment is appropriate where the admissible evidence and pleadings demonstrate “no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a) ; see also Johnson v. Killian , 680 F.3d 234, 236 (2d Cir.2012) (per curiam). A dispute over an issue of material fact qualifies as genuine if the “evidence is such that a reasonable jury could return a judgment for the nonmoving party.” Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248 (1986) ; accord Roe v. City of Waterbury , 542 F.3d 31, 35 (2d Cir.2008). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett , 477 U.S. 317, 325 (1986). “In moving for summary judgment against a party who will bear the ultimate burden of proof at trial, the movant's burden will be satisfied if he can point to an absence of evidence to support an essential element of the nonmoving party's claim.” Goenaga v. March of Dimes Birth Defects Found. , 51 F.3d 14, 18 (2d Cir.1995) (citing Celotex , 477 U.S. at 322–23 ); accord PepsiCo, Inc. v. Coca – Cola Co. , 315 F.3d 101, 105 (2d Cir.2002).

In ruling on a motion for summary judgment, all evidence must be viewed “in the light most favorable to the non-moving party,” Overton v. N.Y. State Div. of Military & Naval Affairs , 373 F.3d 83, 89 (2d Cir.2004), and the court must “resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought,” Sec. Ins. Co. of Hartford v. Old Dominion Freight Line, Inc. , 391 F.3d 77, 83 (2d Cir.2004). To defeat a motion for summary judgment, the non-moving party must advance more than a “scintilla of evidence,” Anderson , 477 U.S. at 252, and demonstrate more than “some metaphysical doubt as to the material facts,” Matsushita Elec. Indus. Co. v....