Team Biondi, LLC v. Navistar, Inc.
| Decision Date | 28 March 2023 |
| Docket Number | Civil Action 3:17-2294 |
| Parties | TEAM BIONDI, LLC, Plaintiff v. NAVISTAR, INC., PHILA. USED TRUCK CENTER, et al., Defendants |
| Court | U.S. District Court — Middle District of Pennsylvania |
Presently before the court is Defendant Navistar, Inc.'s motion for summary judgment. (Docs. 51, 55). Plaintiff Team Biondi, LLC filed a brief in opposition, (Doc. 57), to which Navistar replied, (Doc. 59). This case arises out of a dispute between Team Biondi, a Pennsylvania trucking company, and Navistar, a commercial equipment and vehicle manufacture headquartered in Illinois, regarding Team Biondi's purchase of twelve allegedly defective used trucks from Navistar around 2015. Navistar's motion raises questions pertaining to “as is” clauses and disclaimers of warranty in contracts between two sophisticated parties for the sale of goods, as well as providing a cautionary tale for those seeking to rely on extracontractual representations that are explicitly contradicted by conspicuous language in an executed agreement. Since Navistar has met its burden as the moving party to show there is no genuine dispute as to any material fact for Team Biondi's contract and tort claims, and Team Biondi has not proffered sufficient evidence to raise a genuine dispute, the court will GRANT Navistar's motion for summary judgment.[1]
I. Factual Background[2]
With respect to Navistar's motion for summary judgment, the essential, undisputed facts are as follows.[3] Plaintiff Team Biondi, LLC, is a trucking company headquartered in Lake Ariel, Pennsylvania, that hauls refrigerated food products to distribution centers across the 48 contiguous states. Defendant Navistar, Inc., is a commercial equipment and vehicle manufacturer headquartered in Lisle, Illinois. Among Navistar's products are class 8 commercial trucks; Navistar has designed and manufactured the engines that power those trucks, including the MaxxForce 13-litre engine.
More stringent emission regulations for commercial motor vehicles, promulgated by the Environmental Protection Agency, became effective beginning with model year 2010 vehicles. Leading up to this regulatory change, all American commercial diesel engine manufacturers were forced to engineer a means of reducing nitrous oxide (NOx) emissions to a lower level than ever previously attempted. Starting in 2010, the EPA standards required, among other things, qualified “families” of engines to output no more than “0.5 grams per brake horsepower-hour.” See 40 C.F.R. §86.00111. To assist in meeting the 2010 standards, a manufacturer could utilize “credits” earned from other qualifying engines that were certified at lower emission outputs than the standards required. See 40 C.F.R. §86.001-15.
For model years 2010 through 2013, Navistar manufactured the MaxxForce 13-litre heavy duty engine. The MaxxForce engine was certified compliant by the EPA at the 0.5-gram NOx level with the utilization of credits. The engines differed from Navistar's competitors in that they reduced emission output solely through an exhaust gas recirculation (EGR) system as compared to a selective catalytic reduction (SCR) system that requires additive chemicals. The MaxxForce 13-litre was used in Navistar's heavy-duty vehicles, including its “International” branded Prostars and Lonestars. In 2014, Navistar ceased using the MaxxForce engines in its heavy-duty vehicles, switching to SCR engines. The ultimate failure of the EGR system in the MaxxForce engine has been documented in numerous federal and state lawsuits across the country. The engines suffered from soot and heat issues, among other things. Team Biondi cites trial testimony from three upper-level management personnel at Navistar from a Tennessee state trial in Madison County, Tennessee, that suggests at least some of Navistar's management knew and did not disclose the apparent unreliability of the EGR engines.
Approximately two years after Navistar ended production of the heavy-duty MaxxForce engines, Team Biondi sought to expand its fleet. In three separate transactions in 2015, Team Biondi purchased twelve used International Prostars and Lonestars (the “Trucks”) from Navistar's Used Truck Center in Philadelphia, Pennsylvania. The Trucks had already accumulated significant mileage prior to Team Biondi's purchase; the mileage at purchase ranged from 142,390 to 284,152 miles.
Team Biondi's owner and president, Michael Biondi, was the sole decision maker regarding the purchase of the Trucks, and no one else from Team Biondi was present during negotiations. He negotiated solely with Steve Gunnarson, a Navistar employee and salesperson at the Used Truck Center. Prior to Team Biondi's purchase, the Trucks underwent Navistar's “Diamond Renewed” certification program. The Diamond Renewed program was created by Navistar and consisted of a 180-point pre-sale inspection, parts refurbishments and replacements, and on-board computer software upgrades.
Mr. Biondi testified that he purchased the Trucks based on representations from Navistar that the Trucks had increased uptime, complied with EPA NOx requirements, promised cost savings for purchase and operation, and had undergone extensive testing through the Diamond Renewed program. Michael Biondi also testified that ads for the Diamond Renewed vehicles were in various trade papers and represented that “reliability was up” and “computer parameters were improved.” (See Doc. 57 at 10).
Navistar sold the Trucks to Team Biondi “as is,” and for each Truck, Mr. Biondi executed a “Warranty Acceptance/Denial” form acknowledging the “as is” sale. Team Biondi also purchased from Navistar an Optional Service Contract. Under the Service Contract, Navistar agreed to “repair or replace” certain covered vehicle components for two years or 200,000 miles, whichever came first. The Service Contract contains a disclaimer of all implied and expressed warranties, consequential damages, and parol representations. Mr. Biondi executed a Service Contract for each Truck. Team Biondi used the Trucks to haul refrigerated goods across the country.
During the approximately two years in which it owned the Trucks, Team Biondi accumulated on average 237,576 miles per Truck, thereby exceeding the Service Contract's length of coverage for most of the Trucks. Even so, Team Biondi had numerous issues with the Trucks, which needed ongoing engine repairs. Mr. Gunnarson, the Navistar salesman whom Mr. Biondi dealt with, testified that the Trucks Mr. Biondi purchased had to be fixed approximately six times in the short period Mr. Biondi owned them, and there came a point where Mr. Gunnarson believed the Trucks simply could not be fixed. Mr. Gunnarson also testified that while, in his view, the trucks with the EGR system were less expensive than other trucks due to the market's perception of the truck's engine issue, he was never specifically informed by Navistar of any unresolved defects in the EGR system.
At some point leading up to July 2017, Team Biondi stopped paying its financing notes for the Trucks. In July 2017, all twelve Trucks were repossessed by Team Biondi's lenders for non-payment. After the trucks were repossessed and without providing any pre-suit notice to Navistar, Team Biondi filed suit against Navistar alleging that the Trucks' engines were defective and that the Trucks did not meet Team Biondi's expectations based on Navistar's alleged representations.
II. Legal Standard
Summary judgment is appropriate “if the pleadings, the discovery [including, depositions, answers to interrogatories, and admissions on file] and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Turner v. Schering-Plough Corp., 901 F.2d 335, 340 (3d Cir. 1990). A factual dispute is genuine if a reasonable jury could find for the non-moving party and is material if it will affect the outcome of the trial under governing substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Aetna Cas. & Sur. Co. v. Ericksen, 903 F.Supp. 836, 838 (M.D. Pa. 1995). At the summary judgment stage, “the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Anderson, 477 U.S. at 249; see also Marino v. Indus. Crating Co., 358 F.3d 241, 247 (3d Cir. 2004) (). The court must consider all evidence and inferences drawn therefrom in the light most favorable to the non-moving party. Andreoli v. Gates, 482 F.3d 641, 647 (3d Cir. 2007).
To prevail on summary judgment, the moving party must affirmatively identify those portions of the record which demonstrate the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323-24. The moving party can discharge the burden by showing that “on all the essential elements of its case on which it bears the burden of proof at trial, no reasonable jury could find for the non-moving party.” In re Bressman, 327 F.3d 229, 238 (3d Cir. 2003); see also Celotex, 477 U.S. at 325.
If the moving party meets this initial burden, the non-moving party “must do more than simply show that there is some metaphysical doubt as to material facts,” but must show sufficient evidence to support a jury verdict in its favor. Boyle v. County of Allegheny, 139 F.3d 386, 393 (3d Cir. 1998) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)). The non-moving party must direct the court's attention to specific triable facts...
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