IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA
January 24, 2013
JOHN ZAMPITELLA, ET AL., PLAINTIFFS,
BENSALEM RACING ASS'N, ET AL., DEFENDANTS.
TN WARD CO., THIRD-PARTY DEFENDANT.
The opinion of the court was delivered by: Pratter, J.
Plaintiffs John and Marta Zampitella have filed suit against a group of entities that own and manage Parx Casino, alleging that Mr. Zampitella fell at the casino due to the defendants' negligence. These defendants subsequently filed a third-party complaint against TN Ward Company, Mr. Zampitella's employer, and TN Ward responded by filing a motion to dismiss that complaint in its entirety. For the reasons set forth below, TN Ward's motion is granted in part and denied in part.
On April 18, 2012, Plaintiffs John and Marta Zampitella filed their complaint in this action against the Parx Casino and Bensalem Racing Association, Keystone Turf Club, and Greenwood Gaming and Entertainment, three entities that allegedly manage and own Parx Casino. The complaint alleges that Mr. Zampitella was an employee of the TN Ward Company making a delivery at Philadelphia Park Casino, the predecessor of Parx Casino, when he fell through a hole in a loading dock and was injured. The Zampitellas' complaint also alleges that the parties are diverse, and brings counts against all four defendants for negligence and loss of consortium.
After answering the original complaint, Parx Casino, Keystone Turf Club, Bensalem Racing Association, and Greenwood Gaming (collectively, the "Casino Parties") filed a three-count third-party complaint against TN Ward. In this complaint, the Casino Parties allege that Greenwood Gaming contracted with TN Ward to renovate the casino, and that Section 9.15 of the contract (which the Casino Parties included as an exhibit to their complaint) contains an indemnification clause. According to the Casino Parties, TN Ward's negligence caused Mr. Zampitella's injuries, and TN Ward breached its contract by failing to indemnify them. Consequently, the Casino Parties seek indemnification and contribution from TN Ward.
On September 14, 2012, TN Ward filed a motion to dismiss the third-party complaint pursuant to Rules 12(b)(5)*fn1 and 12(b)(6) of the Federal Rules of Civil Procedure. On September 28, 2012, the Casino Parties filed a response to TN Ward's motion.*fn2
II. Legal Standard
A Rule 12(b)(6) motion to dismiss tests the sufficiency of a complaint. Although Rule 8 of the Federal Rules of Civil Procedure requires only "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed. R. Civ. P. 8(a)(2), in order to "give the defendant fair notice of what the . . . claim is and the grounds upon which it rests," Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citations and quotations omitted) (alteration in original), the plaintiff must provide "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. (citation omitted).
To survive a motion to dismiss, the plaintiff must plead "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Specifically, "[f]actual allegations must be enough to raise a right to relief above the speculative level . . . ." Twombly, 550 U.S. at 555(citations omitted). The question is not whether the claimant will ultimately prevail but whether the complaint is "sufficient to cross the federal court's threshold." Skinner v. Switzer, 131 S. Ct. 1289, 1296 (2011) (citation omitted). An assessment of the sufficiency of a complaint is thus "a context-dependent exercise" because "[s]ome claims require more factual explication than others to state a plausible claim for relief." W. Penn Allegheny Health Sys., Inc. v. UPMC, 627 F.3d 85, 98 (3d Cir. 2010) (citations omitted).
In evaluating the sufficiency of a complaint, the Court adheres to certain well-recognized parameters. For one, the Court "must only consider those facts alleged in the complaint and accept all of the allegations as true." ALA, Inc. v. CCAIR, Inc., 29 F.3d 855, 859 (3d Cir. 1994) (citation omitted); see also Twombly, 550 U.S. at 555 (stating that courts must assume that "all the allegations in the complaint are true (even if doubtful in fact)"). Concomitantly, the Court also must accept as true all reasonable inferences that may be drawn from the allegations, and view those facts and inferences in the light most favorable to the non-moving party. See Rocks v. City of Phila., 868 F.2d 644, 645 (3d Cir. 1989); see also Revell v. Port Auth. of N.Y. & N.J., 598 F.3d 128, 134 (3d Cir. 2010). Nonetheless, the Court need not accept as true "unsupported conclusions and unwarranted inferences," Doug Grant, Inc. v. Greate Bay Casino Corp., 232 F.3d 173, 183-84 (3d Cir. 2000) (citations and quotations omitted), or the plaintiff's "bald assertions" or "legal conclusions," Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997) (citations and quotations omitted).
III. Negligence Claim
The Casino Parties appear to have brought their third-party complaint under Rule 14(a) of the Federal Rules of Civil Procedure.*fn3 In Count 1 of their complaint, the Casino Parties allege that TN Ward's negligence is solely responsible for Mr. Zampitella's injuries. However, in federal practice (as distinct from Pennsylvania state court procedures with which counsel may be more familiar) under Rule 14(a) "the defendant cannot plead a claim that the third-party is directly liable to the plaintiff or a claim that the third-party defendant is solely responsible for the plaintiff's injury." Kohn, 2012 U.S. Dist. LEXIS 63751, at *11. Instead, a defendant "must plead the secondary or derivative liability of the third-party defendant, meaning that if the defendant is found liable to the plaintiff, the third-party defendant is liable to the defendant on a theory of indemnity or contribution, or some other form of derivative liability." Id. at *11-12. Because the Casino Parties use their negligence claim to plead that TN Ward is directly liable to Mr. Zampitella, the Court dismisses Count 1 of the third-party complaint with prejudice. See Slater v. Skyhawk Transp., Inc., 187 F.R.D. 185, 203 (D.N.J. 1999) ("[A] third party complaint may not set forth a claim of the third party defendant's liability to the plaintiff.") (citations and quotations omitted); Toberman v. Copas, 800 F. Supp. 1239, 1242 (M.D. Pa. 1992) ("A defendant sued for negligence, for example, cannot implead a third party whose negligence was totally responsible for [the] plaintiff's injury.") (citations and quotations omitted).
IV. Contribution Claim
In Count 3 of their complaint, the Casino Parties allege that they have a right to contribution from TN Ward should they be found liable in the underlying lawsuit. In Pennsylvania,*fn4 "when an employee's injuries are caused by a third party, that party cannot sue the employer for damages, contribution, or indemnity unless the employer expressly agrees to such liability in a written contract." Yazujian v. Merrell & Garaguso, Inc., No. 12-1450, 2012 U.S. Dist. LEXIS 95959, at *7 (E.D. Pa. July 10, 2012) (citing 77 Pa. Cons. Stat. § 481(b)). Here, the Casino Parties fail to identify any written contract in which TN Ward agreed to liability for employee injuries under a theory of contribution.*fn5 Therefore, the Court will dismiss the Casino Parties' contribution claim with prejudice.
V. Indemnification Claim
Count 3 of the third-party complaint also brings a claim for indemnification against TN Ward pursuant to the indemnification clause in Section 9.15 of the parties' contract. Preliminarily, the Court notes that "Pennsylvania case law makes clear that, for an indemnification clause to require an employer to indemnify claims brought by the employer's own employees, the clause [may] . . . state that the employer's indemnity obligations are not limited by the protections of the Workers' Compensation Act." Muth v. Rondel at Atlas Terrace, LLC, No. 08-476, 2009 U.S. Dist. LEXIS 926, at *9-10 (E.D. Pa. Jan. 8, 2009). Here, the parties' contractual indemnification clause meets this standard, as it states that the "indemnification obligation . . . shall not be limited by a limitation on amount or type of damages, compensation or benefits payable by or for [TN Ward] under workers' compensation acts[.]" In Integrated Project Servs. v. HMS Interiors, Inc., 931 A.2d 724 (Pa. Super. Ct. 2007), the Pennsylvania Superior Court noted that this precise language constituted a "waiver of workers' compensation immunity." Id. at 726. Therefore, the Casino Parties may proceed with their indemnification claim because TN Ward waived its statutory immunity for such a claim.*fn6
The Court next considers TN Ward's argument that the parties' indemnification clause is unenforceable because it fails to state clearly that TN Ward must indemnify the Casino Parties for their own negligence. In Greer v. City of Philadelphia, 795 A.2d 376 (Pa. 2002), the underlying plaintiff sued the Pennsylvania Department of Transportation ("PennDOT"), as well as a contractor and subcontractor hired by PennDOT to remove road signs, after the plaintiff's vehicle was rear-ended while signs were being removed from a highway. See id. at 377. The subcontractor signed a contract in which it agreed to indemnify PennDOT and the contractor "from and against claims . . . arising out of . . . performance of the Subcontractor's Work . . . but only to the extent caused in whole or in part by negligent acts or omissions of the Subcontractor . . . regardless of whether or not such claim[s] . . . [are] caused in part by a party indemnified hereunder." Id. After a jury found that all three defendants were negligent, PennDOT and the contractor sought to have the subcontractor indemnify them for their own negligence. See id. at 378. The Pennsylvania Supreme Court noted that a contract must use "clear and unequivocal language" to indemnify a party for its own negligence. Id. (citations and quotations omitted). The court then held that the contract provided "indemnity . . . for the amount of damage caused by the indemnitor's negligence, [but] not for damages attributable to the indemnitee's negligence." Id. at 381 (emphasis added).
Here, TN Ward correctly notes that the indemnification clause in Greer "mirrors [the language] used in the Contract in the instant matter[.]"*fn7 Docket No. 15 at 15. However, rather than compelling the Court to dismiss the Casino Parties' indemnification claim, Greer establishes that the indemnification clause in this case "require[s] [TN Ward] to provide indemnity from liability for damages that result from [its] negligence." Greer, 795 A.2d at 381. In other words, TN Ward's argument that it need not indemnify the Casino Parties for their own negligence is both correct and non-controlling. The Casino Parties have alleged that TN Ward acted negligently, and this allegation, taken together with Section 9.15, sufficiently pleads an indemnification claim under Greer. See id. at 379-80 ("[W]e read the second part of the [indemnification] provision . . . to clarify that any contributory negligence by [the indemnitees] will not bar their indemnification for damages due to [the indemnitor's] negligence.").*fn8
VI. Breach of Contract Claim
Count 2 of the third-party complaint alleges that TN Ward breached its contract with the Casino Parties by failing to indemnify them. However, the Casino Parties have failed to allege facts suggesting that, at this stage of the parties' dispute, TN Ward has breached its contractual duty to indemnify them or anticipatorily done so through a "'definite and unconditional repudiation'" of the indemnification clause. See Tri-State Prof'ls, Inc. v. Smith Barney, No. 07-1220, 2008 U.S. Dist. LEXIS 20342, at *12 (M.D. Pa. Mar. 12, 2008 ) (quoting Jonnet Dev. Corp. v. Dietrich Indus., Inc., 463 A.2d 1026, 1031 (Pa. Super. Ct. 1983)). Therefore, the Court will dismiss Count 2 of the third-party complaint without prejudice.
For the foregoing reasons, the Court denies TN Ward's Rule 12(b)(6) motion to dismiss with respect to the Casino Parties' indemnification claim, grants the motion with prejudice as to the claims for negligence and contribution, and grants the motion without prejudice with respect to the claim for breach of contract. Additionally, the Court denies the motion to dismiss under Rule 12(b)(5) and will instead quash service and give the Casino Parties 30 days to effect proper service on TN Ward.
An Order consistent with this Memorandum follows.
BY THE COURT:
GENE E.K. PRATTER United States District Judge