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Taylor Tours, LLC v. Sensata Technologies, Inc.

United States District Court, E.D. Pennsylvania

February 17, 2017

TAYLOR TOURS, LLC, and NATIONAL INTERSTATE INSURANCE COMPANY, as subrogee of Taylor Tours, LLC, Plaintiffs,
v.
SENSATA TECHNOLOGIES, INC., SENSATA TECHNOLOGIES OF MASSACHUSETTS, INC., PREVOST CAR, INC., PREVOST CAR (US), INC., and TEXAS ELECTRONIC INSTRUMENTS, Defendants.

          MEMORANDUM

          DuBois, J.

         I. INTRODUCTION

         This is a product liability case. Plaintiffs, Taylor Tours, LLC, and National Interstate Insurance Company, as subrogee of Taylor Tours, LLC, purchased a tour bus and replacement circuit breakers for the bus from defendants Prevost Car, Inc., and Prevost Car (US), Inc. (collectively “Prevost”). Following a tour bus fire allegedly caused by a defect in the bus's electrical system or a faulty replacement circuit breaker, plaintiffs filed this suit, asserting negligence, strict product liability, and breach of warranties claims under Pennsylvania law against Prevost and other defendants. Presently before the Court is Prevost's Motion to Dismiss. For the reasons that follow, the Court denies Prevost's Motion.

         II. BACKGROUND

         The facts of the case as set forth in plaintiffs' Amended Complaint are summarized as follows.

         Plaintiff Taylor Tours is an Arizona Limited Liability Company that “designs, manufactures, assembles, sells and otherwise distributes tour buses.” Am. Compl. ¶ 1.[1] Plaintiff National Interstate Insurance Company, as subrogee of Taylor Tours, is an Ohio corporation that provided insurance to Taylor Tours during the relevant time period. Am. Compl. ¶¶ 2-3. Prevost defendants, Delaware corporations with their principal place of business in Canada, design, manufacture, assemble, sell, and distribute buses, coaches, and motor homes. Am. Compl. ¶¶ 6-7.

         At some point prior to July 2, 2014, Prevost designed, manufactured, and placed into the stream of commerce tour buses, including a 2008 Prevost MTH SL2 45E tour bus. Am. Compl. ¶ 10. Taylor Tours purchased the 2008 tour bus from Prevost. Am. Compl. ¶ 11. Taylor Tours alleges that Prevost incorrectly installed a circuit breaker in the bus, constructed the bus in a manner which allowed moisture and other elements to enter into the bus's circuit breakers, failed to install proper overcurrent protection in the bus, and provided defective replacement circuit breakers for the bus. Am. Compl. ¶¶ 12-16.

         On July 2, 2014, a “fire erupted within the subject tour bus” that Taylor Tours purchased from Prevost. Am. Compl. ¶ 18. The fire allegedly caused extensive damage to Taylor Tours' real and personal property, and “other consequential and incidental damage including clean-up costs, repair, and other associated expenses.” Am. Compl. ¶¶ 18-19. Subsequent investigation of the origin of the fire “revealed significant arcing on circuitry within the bus, ” and that the “subject circuit breaker failed to open to stop the electrical event before the fire occurred.” Am. Compl. ¶ 20.

         Plaintiffs filed their initial Complaint in the Philadelphia Court of Common Pleas on July 25, 2016. On August 29, 2016, Prevost removed the case to federal court, invoking diversity jurisdiction. On September 6, 2016, Prevost filed a Motion to Dismiss. (Doc. No. 4). Plaintiffs subsequently filed an Amended Complaint. (Doc. No. 16, filed Nov. 3, 2016). In their Amended Complaint, plaintiffs assert claims against Prevost for strict product liability (Count IV), negligence (Count V), and breach of warranties (Count VI). Prevost filed the pending Motion to Dismiss on November 7, 2016. (Doc. No. 17). Prevost seeks dismissal of all claims against it.

         III. APPLICABLE LAW

         Rule 12(b)(6) of the Federal Rules of Civil Procedure permits a party to respond to a pleading by filing a motion to dismiss for “failure to state a claim upon which relief can be granted.” To survive a motion to dismiss, the complaint must allege facts that “‘raise a right to relief above the speculative level.'” Victaulic Co. v. Tieman, 499 F.3d 227, 234 (3d Cir. 2007) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). A complaint must contain “sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). A district court first identifies those factual allegations that constitute nothing more than “legal conclusions” or “naked assertions.” Twombly, 550 U.S. at 555, 557. Such allegations are “not entitled to the assumption of truth” and must be disregarded. Iqbal, 556 U.S. at 679. The court then assesses “the ‘nub' of the plaintiff['s] complaint-the well-pleaded, nonconclusory factual allegation[s]”-to determine whether it states a plausible claim for relief. Id.

         IV. DISCUSSION

         In its Motion to Dismiss, Prevost argues that plaintiffs' strict product liability and negligence claims against Prevost are barred by the economic loss doctrine. Mot. at 5. Prevost also contends that plaintiffs' breach of warranties claim is barred by the expiration of their express warranty from Prevost and by the four-year statute of limitations for breach of implied warranties contained in the Uniform Commercial Code. Mot. at 10. The Court will address each argument in turn.

         A. Strict Product Liability ...


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