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Tennis v. Ford Motor Co.

July 26, 2010

RICHARD A. TENNIS, RHODA L. TENNIS, TENNIS, INC., AND TENNIS ROOFING & ASPHALT, INC., PLAINTIFFS,
v.
FORD MOTOR COMPANY, DEFENDANT.



The opinion of the court was delivered by: Judge Mcverry

MEMORANDUM OPINION AND ORDER

Presently pending before the Court for disposition is DEFENDANT FORD MOTOR COMPANY‟S MOTION TO DISMISS PURSUANT TO FED. R. CIV. P. 12(B)(6) AND MOTION TO STRIKE PURSUANT TO FED. R. CIV. P. 12(F) (Document No. 4) with brief in support, filed by Defendant, Ford Motor Company. Plaintiffs filed a brief in response to Defendant‟s Motion to Dismiss and Motion to Strike (Document No. 7) and the motions are ripe for disposition.

Factual Background

This case arises from a fire that ignited unexpectedly and spontaneously from a 1997 Ford Expedition while it was parked inside of a warehouse on or about December 23, 2007. (Compl. at ¶ 10).*fn1 As a result of the fire, Plaintiffs*fn2 allege that they suffered "loss of income, interruption of their business, loss [sic] of improvements to the warehouse, business relocation expenses, loss of use of their money, loss of use of their property, damage to their property, loss of contents in the building, and incurred interest expenses to finance the repairs." (Compl. at ¶ 15). Plaintiffs claim that the smoke and heat from the fire damaged their real and personal property. (Compl. at ¶ 26).

Plaintiffs, Richard A. Tennis and Ronda L. Tennis, husband and wife, reside in Washington County, Pennsylvania. (Compl. at ¶ 1). Plaintiff Tennis Inc., a Pennsylvania corporation, is owned by Richard Tennis. (Compl. at ¶ 2). Plaintiff Tennis Roofing & Asphalt, Inc. is also a Pennsylvania corporation owned and operated by Richard Tennis in Washington County, Pennsylvania. (Compl. at ¶ 3). Tennis, Inc. owned the 1997 Ford Expedition with vehicle Identification Number 1FMEU18W6VLA14811 ("1997 Ford Expedition"). (Compl. at ¶ 8). Defendant Ford Motor Company ("Ford") is a corporation that exists under the laws of the State of Michigan, with its principal place of business located at 1 American Road, Dearborn, Michigan 48126. (Compl. at ¶ 4).

The warehouse that was destroyed in the fire was located at 821 Morganza Road, Allegheny County, Canonsburg, PA 15317, where Plaintiffs operated a roofing and asphalt business. (Compl. at ¶ 10-11). Plaintiffs had entered into an option to purchase the warehouse building, and had done substantial repairs and additions to the building in an amount in excess of $120,000, including a new addition, a new roof, and a new driveway. (Compl. at ¶ 12).

The Complaint alleges that the fire occurred due to a defect in the 1997 Ford Expedition‟s Speed Control Deactivation Switch ("SCDS"). (Compl. at ¶ 16). The fire allegedly originated at the SCDS due to an electrical short or failure of the SCDS and/or its associated circuitry. (Compl. at ¶ 19). The heat generated by the electrical short or failure of the SCDS was sufficient to ignite the surrounding combustibles within the vehicle‟s engine compartment. (Compl. at ¶ 20).

The SCDS is a hydraulic pressure switch that functions as a redundant safety switch to stop power during brake applications. (Compl. at ¶ 27). The switch is normally closed, but contracts open at brake system pressures produced by approximately 5 to 10 pounds of force on the brake pedal. (Compl. at ¶ 28). The SCDS may be oriented so that it mounts in a vertically up, vertically down, or angled down position. (Compl. at ¶ 31). In the 1997 Ford Expedition, the SCDS was mounted in a vertically up position. (Compl. at ¶ 31). The three primary factors that contribute to the defect and failure of the SCDS are 1) vacuum pressure (duration and magnitude); 2) SCDS orientation; and 3) the presence of power at all times. (Compl. at ¶ 56). The Complaint alleges that Ford has known since 1999 that mounting the SCDS in a vertically down position greatly decreases the chances of the SCDS catching fire. (Compl. at ¶ 75).

The Complaint asserts that the switch on the 1997 Ford Expedition received uninterrupted voltage and electrical current from the battery so that it was "Powered at All Times" ("PAT"). (Compl. at ¶ 34). The switch contracts to conduct up to 0.75 amps to the speed control clutch when the speed control is engaged, and 0.005 amps when not engaged. (Compl. at ¶ 35). Depending on the model, Ford installed either a 15 or 20 amp fuse on the speed control circuit. (Compl. at ¶ 36). According to the Complaint, this is significantly more than the current needed for the normal operation of the SCDS microprocessors, and is oversized for this system. (Compl. at ¶ 36).

Even when the automobile is turned off, the SCDS has electricity running through it. (Compl. at ¶ 77). Allegedly, the SCDS circuitry does not contain a circuit breaker or fuse that will isolate, protect, or interrupt the power to the switch when the current exceeds a level essential to produce enough electrical power to overheat. (Compl. at ¶ 78). With vehicles that are powered all the time, the continuous power provides the source to produce sufficient energy to start heating the components of the switch. (Compl. at ¶ 80). According to the Complaint, it was economically, technologically, and physically feasible for Ford to make the SCDS "non PAT" prior to the design, manufacture, and marketing of the 1997 Ford Expedition. (Compl. at ¶ 81).

Plaintiffs contend that Ford knew in 2003 that it was using a "defective electrical component part" (SCDS) which it received from Texas Instruments, and it delayed in having issued a recall of its vehicles, including Plaintiff‟s 1997 Ford Expedition. (Compl. at ¶ 85).

Plaintiffs allege that Ford knew, or should have known, that the defective SCDS and component switch would cause substantial numbers of property damage, injuries, and deaths due to its combustible design, and lack of appropriate and adequate fire avoidance elements. (Compl. at ¶ 86).

According to the Complaint, Ford claims to have allegedly sent out numerous recall notices to its customers, but many customers did not receive any communique alerting them of this recall, or they received letters that were inadequate to constitute a warning of the known dangers. (Compl. at ¶ 97). In cases in which Ford customers did receive recall letter(s), the vehicles were either improperly repaired or could not be properly repaired because Ford lacked a sufficient supply of repair and/or replacement parts. (Compl. at ¶ 98). Plaintiffs claim that in March of 2008they did receive a recall notice for their 1997 Ford Expedition -- after it had already caught fire. (Compl. at ¶ 99).

The Complaint alleges the following causes of action: (I) Strict Liability, (II) Negligence, (III) Breach of Implied Warranty of Merchantability, (IV) Fraud, (V) Negligent Misrepresentation, (VI) Fraud by Non-Disclosure, (VII) Breach of Contract, (VIII) Res Ipsa Loquitur, and (IX) Punitive Damages.

In response, Defendant avers that Plaintiffs‟ claims of fraud (Count IV), negligent misrepresentation (Count V), and fraud by non-disclosure (Count VI) must be dismissed pursuant to Fed. R. Civ. P. 12(b)(6) under Pennsylvania‟s "gist of the action" doctrine. Additionally, Defendant argues that Plaintiffs‟ claims of strict liability (Count I), negligence (Count II), and negligent misrepresentation (Count V) must be dismissed pursuant to Fed. R. Civ. P. 12(b)(6) based on the economic loss doctrine. Further, Defendant asserts that Plaintiffs‟ counts of res ipsa loquitur (Count VIII) and punitive damages (Count IX) must be dismissed pursuant to Fed. R. Civ. P. 12(b)(6) for failure to state a claim upon which relief can be granted. Defendant does not challenge Count III (Breach of Implied Warranty of Merchantability) or Count VII (Breach of Contract). Defendant moves to strike paragraphs seventeen to ninety-eight (17-98) of Plaintiff‟s Complaint pursuant to Fed. R. Civ. P. 12(f), alleging that these paragraphs contain scandalous and impertinent information.

Procedural History

Plaintiffs filed their Complaint in Civil Action in the Court of Common Pleas of Allegheny County, Pennsylvania on April 8, 2010. Defendant filed a timely notice of removal on May 4, 2010 to this Court based on diversity jurisdiction. On May 11, 2010 Defendant filed a Motion to Dismiss seven of the nine counts of the Complaint, a Motion to Strike paragraphs 17-98 of the Complaint, and a supporting brief.

Legal Analysis

As a preliminary matter, jurisdiction in this case is based on the diversity of the parties.

28 U.S.C. § 1332(a). Pursuant to 28 U.S.C. § 1332(a), district courts "have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest, and is between... citizens of different States." Id. Complete diversity requires that, in cases with multiple plaintiffs or multiple defendants, no plaintiff be a citizen of the same state as any defendant. See Zambelli Fireworks Mfg. Co. v. Wood, 592 F.3d 412, 419 (3d Cir. 2010).

Further, a federal court sitting in diversity must apply substantive law of the state in which it sits, Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938), including its choice of law rules. Klaxon Co. v. Stentor Elec. Mfg. Co., Inc., 313 U.S. 487, 496 (1941). All parties have assumed that Pennsylvania law applies to this case, as will the Court.

Defendant has raised numerous legal challenges to the Complaint. The Court will first address Defendant‟s Motion to Strike paragraphs 17-98 of the Complaint based on Fed. R. Civ. P. 12(f). The Court will then address Defendant‟s Motion to Dismiss for failure to state a valid claim pursuant to Fed. R. Civ. P. 12(b)(6).

A. Motion to Strike Pursuant to Fed. R. Civ. P. 12(f)

Defendant moves to strike 82 of the first 98 paragraphs in the Complaint pursuant to Fed. R. Civ. P. 12(f) on the basis that these paragraphs are devoid of any relevant information, and are either impertinent or scandalous. Defendant contends that Plaintiffs have pled impertinent evidentiary information regarding different makes and models of Ford vehicles rather than Plaintiff‟s 1997 Ford Expedition in paragraphs 17-20, 39, 55, 82, 84, 87-90, and 92-98. Defendant also argues that Plaintiffs have improperly pled evidence in many paragraphs that is akin to an introductory statement. Defendant asserts that only the first 16 paragraphs aver facts directly related to Plaintiff‟s 1997 Ford Expedition, and Plaintiffs‟ counts averring causes of action do not begin until paragraph 99, such that all of the intervening averments should be striken.

In response, Plaintiffs contend that they are not precluded by Rule 12(f) from averring specific facts contained in paragraphs 17-98 of the Complaint because the averments are relevant, material, pertinent, and truthful. Plaintiffs argue that the material in the Complaint relates to the controversy, serves to educate the court, and demonstrates that Defendant had knowledge of the defect through illustrations of other scenarios of the same occurrence. According to Plaintiffs, all averments in the Complaint are related to the issues at hand and are essential and important to support each claim for ...


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