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Amco Insurance Co. v. Broane-Nutone

December 27, 2009

AMCO INSURANCE COMPANY, PLAINTIFF,
v.
BROANE-NUTONE,LLC; JAKEL, INC. DOING BUSINESS IN CALIFORNIA AS JAKEL INDUSTRIES, INC., DEFENDANTS.



The opinion of the court was delivered by: Garland E. Burrell, Jr. United States District Judge

ORDER

On July 22, 2009 Defendants filed a motion for summary judgment on all Plaintiff's claims in this insurance subrogation action. The parties dispute whether a ceiling exhaust fan installed in the laundry room of Perpetuan and Crispen Soliven's residence caused a fire in that residence, and whether either or both Defendants defectively designed and/or manufactured the component of that fan alleged to have caused the fire.

The motion was heard on September 14, 2009. Subsequent to the hearing, Defendant Broane-Nutone, LLC ("Broan-Nutone, LLC") filed a notice of bankruptcy under Chapter 11 of the Bankruptcy Code, staying this case against it. However, the remaining parties, Plaintiff and Defendant Jakel, Inc. ("Defendant" or "Jakel"), have not argued that this stay applies to them. Cohen v. Stratosphere Corp., 115 F.3d 695, 697 (9th Cir. 1997) (stating a Chapter 11 bankruptcy stay does not ordinarily preclude nonbankrupt parties from proceeding in the case.)

I. BACKGROUND

Plaintiff alleges negligence and strict liability claims against Defendant Jackel for a design and manufacturing defect in a ceiling exhaust fan installed in the laundry room of the Solivens' residence. Plaintiff contends the alleged defects caused a fire in that residence on September 23, 2006. The fan was installed beside a light fixture, which had a separate on-off switch. (Plaintiff's Statement of Undisputed Facts ("PSUF") ¶¶ 7, 42). The Solivens purchased their home as new construction in 1990 and were the only two people residing there at the time of the fire. (Id. ¶¶ 11, 13.) "The Soliven residence includes two and one-half bathrooms and a laundry room, each containing an exhaust fan." (Id. ¶ 12.)

Plaintiff contends Jackel manufactured the defective component of the exhaust fan that caused the fire. "At the time of manufacture, the subject fan was comprised of the following components[:] (1) the electric motor sub-assembly, which includes the thermal cut-out protector and motor windings; (2) the power receiver, which connects the fan to the building power source (the fan plugs into the power receiver in the same manner as an appliance plugs into a wall electrical outlet); (3) the motor plate that attaches to the fan housing; and (4) the fan grille." (Id. ¶ 39.)

Jackel argues Plaintiff cannot prove the fan was used, contained a design or manufacturing defect, and caused the fire. (Def's Mot. 9:18-15:7.) Jackel also argues Plaintiff failed to preserve key evidence, and because of this failure Plaintiff's complaint should be dismissed. However, this dismissal argument "was [not] presented to . . . the Magistrate Judge during the discovery phase of this case" as required by Local Rule 302(c)(1) and the Scheduling Order filed on September 10, 2008. Toomer v. U.S., 2008 WL 4369312, at *4, n. 1 (S.D.Cal. 2008). Therefore, it is waived. See Freeman v. Allstate Life Ins. Co., 253 F.3d 533, 537 (9th Cir. 2001) (upholding district judge's declination to sanction because of party's "fail[ure] to prosecute the issue before the magistrate judge as required by . . . Local Rule . . . and the court's . . . order"); E*Trade Securities LLC v. Deutsche Bank AG, 230 F.R.D. 582 586 (D.Minn. 2005)(revealing that allegations of discovery misconduct, including the spoliation of evidence, concern discovery issues).

II. STANDARD

"Summary judgment is appropriate if the pleadings together with the affidavits show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. A material fact is one that might allow judgment in favor of the party opposing summary judgment." Pacific Northwest Venison Producers v. Smitch,20 F.3d 1008, 1013 (9th Cir. 1994)(internal citation and quotations omitted). Further, "all reasonable inferences supported by the evidence [are drawn] in favor of the non-moving party . . . " Guidroz-Brault v. Missouri Pacific R. Co., 254 F.3d 825, 828 (9th Cir. 2001).

III. ANALYSIS

A. Use and Causation

Defendant argues since undisputed evidence shows the Solivens never turned on or "used" the fan, Plaintiff cannot prove the "use" or "causation" elements of its claims. (Def's Not. of Mot. 2:3-7; Def's Mot. 9:14-15:7.) Defendant presents deposition testimony from each Soliven supporting its position that the laundry room fan was never turned on. Perpetuan Soliven's deposition testimony on this point follows:

Q: Have you ever used the laundry room fan?

A: No.

Q: During the entire time that you resided at the home since 1990, you never used it?

A: No. (Def's Mot 11:6-13, Ex. E, Perpetuan Soliven Dep. 29:1-9). Crispen Soliven's deposition testimony is as follows:

A: [W]e don't use that fan.

Q: Is that correct?

A: Yes.

Q: Have you ever ...


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