Suzlon Wind Energy Corporation v. Shippers Stevedoring Company
| Decision Date | 27 January 2009 |
| Docket Number | Civil Action No. H-07-155. |
| Citation | 662 F.Supp.2d 623 |
| Parties | SUZLON WIND ENERGY CORPORATION, et al., Plaintiffs, v. SHIPPERS STEVEDORING COMPANY, et al., Defendants. |
| Court | U.S. District Court — Southern District of Texas |
Paul G. Preston, The Preston Law Firm LLP, New Orleans, LA, Alicia K. Dowdy, A.K. Dowdy Brown, PLLC, Spring, TX, Devon Howard Decker, Helms & Greene, LLC, James T. Brown, David L. Stockel, Legge, Farrow, Kimmitt, McGrath & Brown, LLP, Houston, TX, for Defendants.
This suit arises from a fire that damaged a nacelle, which is part of a wind turbine generator. The nacelle was manufactured in India and shipped to the Port of Houston for inland transport to Minnesota. The fire occurred after the nacelle had been unloaded from the ship at the Port of Houston, during preparations for transport on a truck-trailer. Those preparations included "hot work" to secure the nacelle to the trailer.
Suzlon Energy Ltd. ("Suzlon Energy"), based in India, designed and manufactured the wind turbine. Suzlon Wind Energy Corporation ("Suzlon Wind") was the American distributor. The plaintiffs, Suzlon Wind and its insurer, Codan Forsikring A/S ("Codan"), sued Shippers Stevedoring Company ("Shippers"), the stevedoring company that performed the hot work; ATS Wind Energy Services, a Division of Anderson Trucking Services ("ATS"), which contracted with Suzlon Wind to handle the nacelle's inland transport to Minnesota; and Fitzley, Inc. ("Fitzley"), which was hired by ATS to provide the drivers, trucks, and trailers to transport the nacelle. Suzlon Wind and Codan alleged negligence in preparing the nacelle for its inland transport. The day after Suzlon Wind filed this suit, Shippers filed a declaratory judgment action against Suzlon Wind and Suzlon Energy seeking to eliminate or limit liability for the fire damage to the nacelle. The two suits were consolidated. (Docket Entry No. 4).
ATS and Fitzley filed a third-party complaint seeking indemnification or contribution from Andrews Boom Repair, Inc. ("ABR"), the welding company that Shippers hired, and from ABR employee Pablo Pineiro, who did the welding work. (Docket Entry No. 50). Suzlon Wind and Codan cross-claimed against ABR and Pineiro. (Docket Entry No. 52).
On June 29, 2007, Suzlon Wind and Codan moved for partial summary judgment that Shippers, ATS, and Fitzley could not rely on the terms, conditions, limitations, or defenses contained in the bill of lading for the nacelle's ocean shipment. (Docket Entry No. 33). On March 7, 2008, 2008 WL 686206, this court granted the plaintiffs' motion, concluding that defenses and limitations under the bill of lading and COGSA were not applicable. (Docket Entry No. 78). Following mediation, Suzlon Wind and Codan settled their claims against ATS and Fitzley. Those claims, as well as all cross-claims involving ATS and Fitzley were dismissed on May 30, 2008. (Docket Entry No. 134).
The following motions are pending:
• Suzlon Wind and Codan have moved for partial summary judgment granting their breach of contract claim against Shippers. (Docket Entry No. 143). Shippers filed a response, (Docket Entry No. 153); Suzlon Wind and Codan replied, (Docket Entry No. 156); Shippers filed a surreply, (Docket Entry No. 167); and Suzlon Wind and Codan replied to the surreply, (Docket Entry No. 171).
• Shippers has moved for leave to amend its answer and counterclaim, (Docket Entry No. 146). Suzlon Wind and Codan responded, (Docket Entry No. 154); Shippers replied, (Docket Entry No. 164); and Suzlon Wind and Codan filed a surreply, (Docket Entry No. 166). ABR filed a joinder to Shippers's motion for leave to amend, (Docket Entry No. 162); Suzlon Wind and Codan responded, (Docket Entry No. 169); and ABR replied, (Docket Entry No. 177).
• Shippers has moved for partial summary judgment dismissing the plaintiffs' breach of contract and negligence per se claims, (Docket Entry No. 158), to which Suzlon Wind and Codan responded, (Docket Entry No. 174). Shippers filed a motion to consider additional evidence, (Docket Entry No. 182), which Suzlon Wind and Codan opposed, (Docket Entry No. 183). Shippers filed a second motion to consider additional evidence, (Docket Entry No. 184), and Suzlon Wind and Codan responded, (Docket Entry No. 188).
• ABR moved for partial summary judgment dismissing the plaintiffs' claims against it, (Docket Entry No. 160). Suzlon Wind and Codan responded, (Docket Entry No. 170), and ABR replied, (Docket Entry No. 180).
• Suzlon Wind and Codan moved to exclude the testimony of Ruben Arredondo, a witness ABR designated, (Docket Entry No. 157). ABR responded, (Docket Entry No. 168), and Suzlon Wind and Codan replied, (Docket Entry No. 176).
• ABR moved to exclude the testimony of Dr. Lawrence M. Matta, an expert the plaintiffs designated, (Docket Entry No. 163). Suzlon Wind and Codan responded, (Docket Entry No. 173), as did Suzlon Energy, (Docket Entry No. 175), and ABR replied, (Docket Entry No. 178).
• ABR moved to exclude the testimony of Haskell Simpkins, an expert the plaintiffs designated, (Docket Entry No. 186). Suzlon Wind and Codan responded, (Docket Entry No. 189), and ABR replied, (Docket Entry No. 193).
• ABR moved to compel production of documents by Suzlon Wind and Codan, (Docket Entry No. 159). Suzlon Wind and Codan responded, (Docket Entry No. 172); ABR replied, (Docket Entry No. 179); and Suzlon Wind and Codan filed a surreply, (Docket Entry No. 181).
• ABR moved to compel the deposition of Suzlon Wind's CEO Andy Cukurs, (Docket Entry No. 187). Suzlon Wind and Codan responded, (Docket Entry No. 190), and ABR replied, (Docket Entry No. 192).
Based on a careful review of the motions, responses, and replies; the record; the parties' submissions; and the applicable law, this court:
• grants Shippers's motion to consider additional evidence in connection with the summary judgment motions, (Docket Entry No. 184);1
• grants the motions for leave to amend filed by Shippers and ABR;
• denies the plaintiffs' motion for summary judgment on their breach of contract claim;
• grants in part and denies in part Shippers's motion for partial summary judgment on the plaintiffs' breach of contract and negligence per se claims;
• grants ABR's motion for partial summary judgment on the plaintiffs' claims;
• grants in part and denies in part the plaintiffs' motion to exclude Arredondo's expert testimony;
• denies ABR's motion to exclude Matta's expert testimony;
• grants in part and denies in part ABR's motion to exclude Simpkins's expert testimony;
• grants in part and denies in part ABR's motion to compel documents from Suzlon Wind and Codan; and
• denies ABR's motion to compel the deposition of Cukurs.
The reasons for these rulings are explained below.
Suzlon Energy regularly ships wind energy equipment that it designs and manufactures from India to its United States distributor, Suzlon Wind. Shortly before the shipment at issue, two fires occurred in nacelles manufactured by Suzlon Energy. The first of the fires occurred on October 25, 2005 in a nacelle on board the BBC Canada in the Houston ship channel. The fire started while welders were performing hot work to remove a clip securing the nacelle to the ship's deck. The nacelle's polyurethane foam insulation and fiberglass shell ignited and provided fuel for the fire. The crew, which had maintained a fire watch and had multiple fire extinguishers, was able to put the fire out. The second of the fires occurred on November 11, 2005 in Minnesota. A nacelle caught fire while hot work was being performed during installation. The fire started when sparks or "slag" from a worker's oxyacetylene torch ignited the foam insulation inside the nacelle. One worker was killed. Kenneth Glazier, in-house counsel and a vice-president of Suzlon Wind, received a report on the BBC Canada fire and damage to the nacelle. Glazier also promptly learned of the Minnesota fire and wrote a report on it.
On the day of the Minnesota fire, Suzlon Wind's Chief Operating Officer, John Hewitt issued a "MANDATORY INSTRUCTION" that "NO HOT WORK" be performed near any Suzlon Wind turbine until further notice. (Docket Entry No. 153, Ex. B). Glazier testified that the instruction applied to all Suzlon employees and to anyone working on a Suzlon nacelle. ). Glazier also testified that he would want to tell anyone doing hot work on a Suzlon nacelle about the no-hot-work mandatory instruction. (Id., at 112:6-9). Suzlon Wind's position in this lawsuit is that the no-hot-work instruction applied only to nacelles undergoing assembly or being installed on the job site, not to nacelles that were being prepared for transport. (Id., at 117:14-25).
On November 17, 2005, Steve Mikel, head of Suzlon Wind's Minnesota operation, issued a memorandum on "Foam Removal Procedure." (Docket Entry No. 153, Ex. D). Glazier testified that Suzlon Wind instituted this procedure because "[t]he polyurethane foam (accoustical egg crate foam) has a potential to catch fire if an ignition source is present within the nacelle." Suzlon Wind required "[a]s a necessary precaution, [that] the polyurethane foam ... be removed from the nacelle" before hot work was performed. (Id.). After the November 2005 fire, at the request of Suzlon Wind, Suzlon Energy stopped putting insulation in the nacelles that it manufactured and shipped to the United States. ).
The nacelle at issue was shipped by Suzlon Energy to Suzlon Wind...
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