Moffitt v. Icynene, Inc.

• Decision Date: 27 December 2005
• Docket Number: No. 1:04-CV-115.,1:04-CV-115.
• Citation: 407 F.Supp.2d 591
• Parties: Elizabeth MOFFITT and Matthew Moffitt, Plaintiffs v. ICYNENE, INC., Nicholas Krywaka, d/b/a Environmental Foam of Vermont, Environmental Foam of Vermont, Inc., Defendants.
• Court: U.S. District Court — District of Vermont

407 F.Supp.2d 591

Elizabeth MOFFITT and Matthew Moffitt, Plaintiffs v. ICYNENE, INC., Nicholas Krywaka, d/b/a Environmental Foam of Vermont, Environmental Foam of Vermont, Inc., Defendants.

No. 1:04-CV-115.

United States District Court, D. Vermont.

December 27, 2005.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

John Lewis Franco, Jr., Burlington, VT, for Plaintiffs.

Eric Andrew Poehlmann, Downs Rachlin Martin PLLC, Lisa M. Werner, Clark, Long, Werner & Flynn, Burlington, VT, Kevin D. Szczepanski, Sheldon K. Smith, Hodgson Russ LLP, Buffalo, NY, Matthew David Gilmond, Ryan, Smith & Carbine Ltd., Rutland, VT, for Defendants.

ORDER

MURTHA, District Judge.

The Magistrate Judge's Report and Recommendation was filed December 2, 2005 (Paper 85). After de novo review and over objection, the Report and Recommendation is AFFIRMED, APPROVED and ADOPTED. See 28 U.S.C. § 636(b)(1).

Defendant Icynene, Inc.'s motion for summary judgment (Doc. 46) is GRANTED as to the implied warranty of fitness for a particular purpose, consumer fraud and negligence claims, and DENIED as to the implied warranty of merchantability claim under the UCC and MMWA.

Plaintiffs' motions for partial summary judgment on liability for consumer fraud and breach of warranty (Docs. 41 and 44) is DENIED.

Plaintiffs' motion for partial summary judgment (Doc. 43) is GRANTED as to the claim that they are "consumers," and DENIED as to the claim that they are "owners."

Plaintiffs' motion in limine (Doc. 43) is DENIED.

The referral of this case to the Magistrate Judge is hereby terminated. This case shall be placed on the first trial calendar after February 1, 2006.

SO ORDERED.

MAGISTRATE JUDGE'S REPORT & RECOMMENDATION

NIEDERMEIER, United States Magistrate Judge.

(Documents 41, 43, 44 and 46)

Plaintiffs Elizabeth and Matthew Moffitt ("Moffitts") bring this action to recover for moisture damage in their vacation home allegedly caused by the insulation. They have made claims against the manufacturer of the insulation, Icynene, Inc. ("Icynene"), the dealer/installer, Nicholas Krywka d/b/a Environmental Foam of Vermont, and Environmental Foam of Vermont, Inc. (collectively "Environmental Foam" or "Krywka"). The Moffitts' claims are based in negligence, consumer fraud, and breach of the implied warranties of merchantability and fitness for a particular purpose.

Presently before the court are Icynene's motion for summary judgment and the Moffitts' motions for partial summary judgment and motion in limine to exclude the expert testimony of William Savage.

For the reasons set forth below, I recommend that Icynene's motion for summary judgment (Doc. 46) be GRANTED in part and DENIED in part. I recommend that the Moffitts' motions for partial summary judgment (Docs. 41, 43, and 44) be GRANTED in part and DENIED in part. I also recommend that the Moffitts' motion in limine be DENIED.

FACTUAL BACKGROUND

Icynene is a Canadian corporation with its corporate headquarters and principal place of business in Mississauga, Ontario. (Doc. 31, ¶ 2). Icynene manufactures open-cell foam insulation under the trademark "Icynene." (Doc. 42, Ex. 3, ¶¶ 1-3). It sells the component chemicals to trained independent dealers who install the insulation. Id.

Environmental Foam is a Vermont corporation located in Jericho, Vermont and owned by Nicholas Krywka. (Doc. 47, ¶ 5). Environmental Foam is a licensed Icynene dealer. (Doc. 42, ¶ 3). In addition to Icynene brand insulation, Environmental Foam also sells and installs closedcell polyurethane insulating foam. (Doc. 47, ¶ 5).

The Moffitts are residents of New Jersey. (Doc. 47, ¶ 1). In 1999, they purchased land in Warren, Vermont on which they planned to build a house. (Doc. 47, ¶ 2). To this end, the Moffitts purchased a pre-fabricated 12' by 18' cabin. (Doc. 47, ¶ 3). The Moffitts have experience in the construction trade and knew that they wanted to insulate the cabin with polyurethane foam. (Doc. 71, Ex. C Deposition of Matthew Moffitt ("Mr. Moffitt Depo.") at 19, 149; Doc. 71, Ex. I Deposition of Elizabeth Moffitt ("Mrs. Moffitt Depo.") at 18-22, 83). Mr. Moffitt hired Environmental Foam to install the insulation. (Doc. 47, ¶ 6). In October 2000 when Krywka arrived to install the insulation, (Mr. Moffitt noticed the Icynene label and questioned Krywka about it. (Mr. Moffitt Depo. at 32). According to Mr. Moffitt, Krywka told him that Icynene was not polyurethane but was an equivalent product that would do the same job. (Id. at 52). According to Krywka, he and Mr. Moffitt discussed the difference in heat loss between Icynene and polyurethane foam. (Doc. 42, Ex. I Deposition of Nicholas Krywka ("Krywka Depo.") at 41-44). Krywka claims that the explained that Icynene would not function as a vapor barrier¹ and that the Moffitts would not need to apply a vapor barrier with Icynene provided they kept the indoor humidity to 30-35%. (Id.). Krywka installed the Icynene in the walls and ceiling of the Moffitts' house. (Doc. 42, ¶ 5). Mr. Moffitt did not ask for a vapor barrier and Krywka did not install one. (Id. at ¶¶ 14, 21).

The conditions that necessitate using a vapor barrier with Icynene insulation are in dispute. A 1994 study by the National Association of Home Builders ("NAHB") recommends using a vapor barrier with Icynene insulation in climates with 7,500 or more heating degree days² ("HDD"). (Doc. 42, ¶ 11). According to Krywka, during his Icynene training in 1997, Icynene's Chief Engineer Gabe Farkas advised the trainees that the NAHB study only applies to structures with vapor drive conditions such as indoor swimming pools or hot tub rooms that have high humidity. (Doc. 71, Ex. J Affidavit of Nicholas Krywka ("Krywka Aff."), ¶ 3). There is no mention of the 7,500 HDD standard in the 1997 Icynene training manual. (Id. at ¶ 5; Doc. 71, Ex. F Deposition of Gabe Farkas ("Farkas Depo.") at 49). The Icynene 2000 training manual references the NAHB study and recommends using a vapor barrier in climates with at least 8,000 HDD. (Doc. 42, ¶ 3). A 2003 Icynene specification sheet recommends using a vapor barrier in climates with 7500 HDD or more. (Id. at Ex. 3). Icynene has also recommended using of a vapor barrier in climates over 9000 HDD if there are vapor drive conditions. (Doc. 71, Ex. J).

During the winter of 2001-2002, Mrs. Moffitt noticed that the walls of the cabin were damp in certain places and that there was mildew on some of the paneling in her son's room. (Mr. Moffitt Depo. at 115; Mrs. Moffitt Depo. at 54). In October 2002, Mr. Moffitt discovered some of the interior paneling was warped and "popping off." (Mr. Moffitt Depo. at 115, 160). Again, in the winter of 2002-2003, they noticed the dampness and mildew. (Mrs. Moffitt Depo. at 54-55, 73). In 2004, the Moffitts cut into the walls of the cabin to find the source of the excess moisture. (Id. at 72; Mr. Moffitt Depo. at 126). They discovered that the insulation was saturated and even frozen in some areas. (Id.). It was then that the Moffitts suspected that the insulation was causing their moisture problems. (Mr. Moffitt Depo. at 160-161).

The Moffitts have asserted four claims against both Icynene and Krywka. First, they allege that Icynene and Krywka breached the implied warranties of merchantability and fitness for a particular purpose under Vermont's Uniform Commercial Code ("UCC"). The Moffitts also seek to recover for these alleged breaches under the Magnuson-Moss Warranty — Federal Trade Commission Improvement Act ("MMWA"), 15 U.S.C. § 2310(d). Third, the Moffitts claim that Icynene and Krywka engaged in unfair and/or deceptive business practices in violation of Vermont's Consumer Fraud Act ("VCFA"). Finally, the Moffitts allege that Icynene and Krywka were negligent in supplying and installing the insulation.

Icynene has moved for summary judgment on all counts. The Moffitts have moved for partial summary judgment that (1) they are "consumers" within the meaning of the Vermont Consumer Fraud Act, (2) they are "owners" not "contractors," (3) defendants are liable for consumer fraud, and (4) defendants are liable for breach of the implied warranty of merchantability. The Court held a hearing on November 1, 2005.

STANDARD OF REVIEW

Summary judgment should be granted when "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law," Fed.R.Civ.P. 56(c), or "`[w]here the record taken as a whole could not lead a rational trier of fact to find for the non-moving party.'" Konikoff v. Prudential Ins. Co. of Am., 234 F.3d 92, 97 (2d Cir.2000) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986)). "A fact is `material' if it `might affect the outcome of the suit under the governing law.'" O'Hara v. Weeks Marine, Inc., 294 F.3d 55, 61 (2d Cir.2002) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). An issue of fact is "genuine" where "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id.

The moving party bears the initial burden of showing an absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once that burden is met, the non-moving party must set forth "specific facts showing that there is a genuine issue for trial." Fed. R.Civ.P.56(c). "When determining whether there is a genuine issue of fact to be tried, the court must resolve all ambiguities and draw all reasonable inferences in favor of the party against whom summary judgment is sought." Winter v. United States, 196 F.3d 339, 346 (2d Cir.1999) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). As to any claim or essential element for which the non-moving party bears the burden of proof at trial, the non-moving party must make a showing sufficient to...