Van Doren v. Coe Press Equipment Corp.

• Decision Date: 30 December 2008
• Docket Number: No. 06-CV-02835.,06-CV-02835.
• Parties: Walter VAN DOREN, et al., Plaintiff, v. COE PRESS EQUIPMENT CORP., et al., Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

592 F.Supp.2d 776 Walter VAN DOREN, et al., Plaintiff,
v.
COE PRESS EQUIPMENT CORP., et al., Defendants. Civil Action No. 06-CV-02835. United States District Court, E.D. Pennsylvania. December 30, 2008.

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Robert Ross, Matthew A. Casey, Roberta Golden, Ross Feller Casey, LLP, Philadelphia, PA, for Plaintiff.

Paul R. Brady, III, Marshall, Dennehy, Warner, Coleman & Goggin, Dean F. Murtagh, William C. Stubits, German, Gallagher & Murtagh, PC, Philadelphia, PA, for Defendants.

MEMORANDUM

LEGROME D. DAVIS, District Judge.

I. BACKGROUND

From approximately 2004 to 2006, Plaintiff Walter Van Doren ("Van Doren") was an employee of Columbia Lighting LCA, Inc., in Bristol; Pennsylvania ("Columbia Bristol"). His duties included operating machines used to make housings for lights. One of the machines he operated was a straightener machine, a machine used to straighten large coils of metal. The machine had two large metal rolls between which the metal would be pulled in order to be straightened. On May 2, 2006, Van Doren suffered an accident at work in which both of his arms became trapped in the straightener machine. According to Van Doren, in the minutes preceding the accident he cleaned the machine in preparation for a project and then took a cigarette break. Upon returning from his break, Van Doren was walking in front of the machine when his right hand suddenly became trapped between the rolls of the machine. The machine lifted him off the ground and pulled him in. As he attempted to free his right hand using his left hand, his left hand, too, became entrapped in the machine. Van Doren screamed for help and eventually his co-workers came to his assistance. The workers attempted to extract Van Doren from the machine. When those efforts failed, a surgeon had to perform a field amputation, removing both of Van Doren's arms while he was still trapped inside the machine.

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The straightener machine involved in the accident was manufactured by Sesco, Inc. The machine was originally built with a metal attachment called a stock support, which was used to guide material into the straightener. According to Manufacturer Defendants, the stock support also acted as a guard by ensuring that the machine operator remained approximately 18 inches away from the "pinch point," namely the space between the machine's two rolls. The machine's Operator's Maintenance Manual did not identify the stock support as a guard or safety feature. In 1981, Columbia Lighting in Spokane, Washington, ("Columbia Spokane") purchased the machine. At some point during the course of its ownership, Columbia Spokane removed the stock support from the machine and replaced it with a feeder tray. In 2002, Colombia Spokane transferred the straightener to Columbia Bristol. The straightener was conveyed with neither the stock support nor the feeder tray.

On June 28, 2006, Van Doren and his wife, Plaintiff Sandra Van Doren (together "Plaintiffs"), brought the present action in this Court. The complaint named two sets of defendants: a group referred to as the "Manufacturer Defendants" and a group referred to as the "Prior Owner Defendants." The Manufacturer Defendants are corporations that Plaintiffs allege were successors to the original manufacturer of the machine, Sesco, Inc. The Prior Owner Defendants are corporations that owned or had at some point acquired Columbia Spokane and Columbia Bristol.

The Manufacturer Defendants named in Plaintiffs' complaint are Coe Press Equipment Corporation, Sesco Corporation, and Sesco Products Group, Inc. In September 1999, Coe Press Equipment Corporation set up Sesco Acquisition Corporation, a wholly owned subsidiary, to purchase limited assets from Sesco, Inc. The purchase agreement included all the intellectual property of Sesco, Inc.; its customer, supplier, and advertising records; and a noncompetition agreement. Sesco Acquisition Corporation also purchased other manufacturing assets outside of the Asset Purchase Agreement, including computer equipment, electrical and mechanical inventory parts, and certain inventory. Approximately one and a half years after the purchase, Sesco Acquisition Corporation transferred all of its acquired assets to Sesco Corporation. In 2002, Sesco Corporation changed its name to Sesco Products Group. Sesco Products Group remains a wholly-owned subsidiary of Coe Press Equipment.

The Prior Owner Defendants named in Plaintiffs complaint are Hanson PLC, Jacuzzi Brands, Inc., Columbia Spokane, Hubbell Lighting, Inc., and Hubbell Incorporated. On September 4, 2007, this Court issued an Order granting Defendant Hanson PLC's motion to dismiss for lack of personal jurisdiction. Jacuzzi Brands, Inc., was the parent company of Columbia Spokane and Columbia Bristol until April 2002. In April 2002, Columbia Spokane and Columbia Bristol were sold to another entity. In 2004, Columbia Spokane and Columbia Bristol, through a series of mergers, became part of Hubbell Lighting, Inc. Accordingly, Plaintiffs assert their negligence claims against Hubbell Lighting, Inc., as successor in interest to Columbia Spokane. Hubbell Incorporated is the sole shareholder of Hubbell Lighting, Inc.

Manufacturer Defendants and Prior Owner Defendants moved for summary judgment on all of Plaintiffs' claims.

II. LEGAL STANDARD

Pursuant to Federal Rule of Civil Procedure 56(c), a court shall grant a motion for 3 summary judgment if "the pleadings, the discovery and disclosure materials on file,

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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." The moving party bears the initial responsibility of identifying the portions of the record "which it believes demonstrate the absence of a genuine issue of material fact." El v. SEPTA, 479 F.3d 232, 237 (3d Cir.2007). However, even if the moving party fulfills this requirement, "the non-moving party can defeat summary judgment if it nonetheless produces or points to evidence in the record that creates a genuine issue of material fact." Id. at 238 (citing Josey v. John R. Hollingsworth Corp., 996 F.2d 632, 637 (3d Cir.1993)).

In evaluating a motion for summary judgment, "the court must neither resolve factual disputes nor make judgments of credibility; instead, all `[i]nferences should be drawn in the light most favorable to the non-moving party.'" Peloro v. U.S., 488 F.3d 163, 173 (3d Cir.2007) (quoting Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1362 (3d Cir.1992)). If the non-moving party's evidence contradicts the movant's, "then the non-movant's must be taken as true." Big Apple BMW, Inc., 974 F.2d at 1363. A non-moving party may not rely solely on mere pleadings or allegations to identify unresolved genuine issues of material fact. Fed.R.Civ.P. 56(e)(1); SEPTA, 479 F.3d at 238 (citing Berckeley Inv. Group, Ltd. v. Colkitt, 455 F.3d 195, 201 (3d Cir.2006)). However, a non-moving party's affidavit is enough to present a genuine issue of fact if it clearly asserts a specific fact in question. See Schoch v. First Fidelity Bancorporation, 912 F.2d 654, 657 (3d Cir.1990).

III. DISCUSSION

A. Manufacturer Defendants

We turn first to Manufacturer Defendants' Motion for Summary Judgment. The foregoing discussion will address four main issues. Part 1 will address the appropriate choice of law to be used in this case. Part 2 will discuss Plaintiffs' negligence, breach of warranty, and punitive damages claims. Part 3 will analyze Plaintiffs' strict liability claim. Finally, Part 4 will address whether Coe Equipment Corporation can be held liable under Plaintiffs' claims.

1. Choice of Law

The parties in this matter disagree over whether this Court should apply Pennsylvania law or Michigan law in assessing Plaintiffs' claims against Manufacturer Defendants. Accordingly, at the outset we must conduct a choice of law analysis. Because this is a diversity case, we apply the choice of law rules of the forum state, namely Pennsylvania. Hammersmith v. TIG Ins. Co., 480 F.3d 220, 226 (3d Cir. 2007). The first step in a choice of law analysis under Pennsylvania law is to determine whether there is "an actual or real conflict between the potentially applicable laws." Id. at 229-30. If the jurisdictions' laws differ in relevant ways, "then the court should examine the governmental policies underlying each law, and classify the conflict as a `true,' `false,' or an `unprovided-for' situation." Id. The choice of law analysis continues past that point only if the Court finds that there is a "true" conflict, namely if "both jurisdictions' interests would be impaired by the application of the other's laws." Id. If a true conflict exists, then the court must determine "which state has the greater interest in the application of its law." Id. (internal citations omitted).

Both parties agree that there is a true conflict between Michigan law and Pennsylvania law in this case because the laws differ in the extent to which they recognize exceptions to the traditional successor

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non-liability principle in a strict liability case. (Manufacturer Defs.' Mot. 11-12; Pls.' Resp. to Manufacturer Def.'s Mot. 14.) Both states' laws recognize the general rule that a successor that acquires the assets of another company by purchasing them for cash does not automatically assume the predecessor's liabilities. Dawejko v. Jorgensen Steel Co., 290 Pa.Super. 15, 434 A.2d 106, 107 (1981); Foster v. Cone-Blanchard Mach. Co., 460 Mich. 696, 597 N.W.2d 506, 509 (1999). Both states' laws recognize five traditional exceptions to that principle.¹ We need not address those traditional exceptions here because both Plaintiffs and Manufacturer Defendants agree that they do not apply in this case. (Manufacturer Defs.' Mot. 11-12; Pls.' Resp. to Manufacturer Def.'s Mot. 17-21.)...