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Blue Dolphin Charters, Ltd v. Knight & Carver Yachtcenter

April 6, 2012

BLUE DOLPHIN CHARTERS, LTD.,
PLAINTIFF,
v.
KNIGHT & CARVER YACHTCENTER,
DEFENDANT.



The opinion of the court was delivered by: M. James Lorenz United States District Court Judge

ORDER GRANTING MOTION TO DISMISS WITHOUT LEAVE TO AMEND [DOC. 20]

This action arises from Plaintiff Blue Dolphin Charters, LTD's allegation that the underwing of a catamaran constructed by Defendant Knight & Carver Yachtcenter, Inc. was defective and not built to comply with applicable regulations. Defendant now moves to dismiss the Amended Complaint, which asserts a single cause of action for fraud. Plaintiff opposes.

The Court found this motion suitable for determination on the papers submitted and without oral argument. See Civ. L.R. 7.1(d.1). (Doc. 21.) For the following reasons, the Court GRANTS WITHOUT LEAVE TO AMEND Defendant's motion to dismiss.

BACKGROUND

Plaintiff offers sightseeing, scuba diving, and snorkel tours to tourists from its two sailing catamarans off of the Na Pali Coast in the Hawaiian Island of Kauai. (Am. Compl. ¶ 6 [Doc. 19].) Defendant is a full-service marine facility that specializes in the repair and refit of "megayachts," and advertises itself as a "premier luxury yacht builder" with "an experienced of master craftsmen in all marine trades, as well as on-site marine engineering professionals and naval architects." (Id. ¶ 7.)

In 1998, "[P]laintiff commissioned [Defendant] to co-design, construct, and equip a 62' x 25' catamaran sailing vessel that was in full compliance with all applicable Coast Guard regulations under 46 Code of Federal Regulations ('CFR'), Subchapter T-Small Passenger Vessels (Under 200 Gross Tons)." (Am. Compl. ¶ 9.) Plaintiff alleges that Defendant "had the legal duty under federal regulation to meet these requirements." (Id. ¶ 12.)

On or about December 8, 1999, Plaintiff took possession of the catamaran, which was commissioned as the Blue Dolphin II, and transported it to Kauai. (Am. Compl. ¶ 13.)

Leading up to and during 2010, Plaintiff learned of "an alarming number of demastings of sailing vessels in the Hawaiian Islands resulting in injuries and/or deaths to passengers." (Am. Compl. ¶ 14.) As a result, the United States Coast Guard began inspecting sailing vessels in Hawaii. (Id.) In anticipation of the inspection, Plaintiff retained a marine surveyor to pre-inspect its vessels, including the Blue Dolphin II. (Id.)

On or about April 10, 2010, the marine surveyor discovered that "the underwing beneath the Blue Dolphin II's mast step was flexing and causing her entire sail rig to move in a dangerous manner." (Am. Compl.¶ 15.) To investigate the problem, Plaintiff alleges that "the Blue Dolphin II's mast was removed by crane whereupon it was discovered that the underwing did not comply with the structural design requirements outlined in Title 46 CFR Subchapter T.") As a result, Plaintiff alleges that the catamaran was taken out of service and that it will be forced to make over $160,000.00 in repairs. (Id. ¶ 16.) It also adds that "[d]ue to the latency of the defect, [Plaintiff] was blamelessly ignorant of its rights and could not have discovered the facts giving rise to the claims set forth herein until the vessel was dismantled and inspected."

¶ 17.)

On March 22, 2011, Plaintiff filed a complaint in this Court asserting six causes of action:

(1) breach of contract; (2) fraud; (3) negligence; (4) negligent interference with prospective business advantage; (5) negligent misrepresentation; and (6) breach of warranty. On May 31, 2011, Defendant moved to dismiss Plaintiff's First (breach of contract), Second (fraud), Fourth (negligent interference with prospective business advantage), and Sixth (breach of warranty) Causes of Action. (Doc. 6.) The Court granted the motion, but gave Defendant leave to amend its complaint. (Doc. 14.)

On December 8, 2011, Plaintiff filed an Amended Complaint asserting a single cause of action for fraud. (Doc. 19.) Defendant now moves to dismiss the Amended ...


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