PMA Companies v. Genox Transportation, Inc. et al

Filing 44

ORDER granting 39 Motion for Leave to File Third-Party Complaint. Cleancor SHALL file the third-party complaint attached to its Motion within seven (7) days of the electronic docketing of this Order. Signed by Judge Janis L. Sammartino on 7/19/2021. (jmr)

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Case 3:20-cv-02540-JLS-RBM Document 44 Filed 07/19/21 PageID.233 Page 1 of 4 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 PMA COMPANIES, Case No.: 20-CV-2540 JLS (RBM) Plaintiff, 12 13 14 16 GENOX TRANSPORTATION, INC.; APPLIED LNG TECHNOLOGIES, LLC; LAIRD TRANSPORTATION, LLC; and DOES 1 to 20, inclusive, 17 ORDER GRANTING CLEANCOR LNG, LLC’S MOTION FOR LEAVE TO FILE THIRD-PARTY COMPLAINT v. Defendants. 15 (ECF No. 39) 18 19 20 Presently before the Court is Third-Party Defendant Cleancor LNG, LLC’s 21 (“Cleancor”) Motion for Leave to File Third-Party Complaint (“Mot.,” ECF No. 39). No 22 Party filed an opposition to the Motion. See generally Docket. Cleancor seeks leave to 23 file a third-party complaint against Phillips Cattle Company (“Phillips”), which is a cattle 24 and feed company insured by Plaintiff PMA Companies (“PMA”). See generally Mot. 25 BACKGROUND 26 This is a subrogation action by PMA, an insurer of Phillips, to recover insurance 27 benefits paid for damages to Phillips’s property as a result of a fire that occurred on 28 Phillips’s premises on or about May 15, 2019. See ECF No. 1-2 (“Compl.”) ¶ 1. PMA 1 20-CV-2540 JLS (RBM) Case 3:20-cv-02540-JLS-RBM Document 44 Filed 07/19/21 PageID.234 Page 2 of 4 1 alleges that Phillips contracted with Applied LNG Technologies, LLC (“Applied”) to 2 deliver liquid natural gas to Phillips’s grain milling facility. Id. ¶ 9. Applied allegedly 3 subcontracted with GenOx Transportation, Inc. (“GenOx”) and Laird Transportation, LLC, 4 (“Laird”) to complete the delivery. Id. ¶ 3. PMA claims that Defendants were negligent 5 during the unloading process of the liquid natural gas, which caused a fire and damaged 6 Phillips’s property. Id. ¶¶ 14, 16. PMA asserts claims for negligence, negligence per se, 7 and strict liability against Applied, GenOx, and Laird. See generally id. 8 On December 31, 2020, GenOx filed for removal of PMA’s action to this Court. See 9 ECF No. 1. On January 29, 2021, Applied filed a third-party action against Cleancor for 10 contractual indemnity and declaratory relief. See ECF No. 9. Pursuant to Federal Rule of 11 Civil Procedure 14(a)(1), Cleancor moves for leave to file a third-party complaint against 12 Phillips for contractual indemnity, breach of contract, and declaratory judgment pursuant 13 to the parties’ contract. See generally Mot. 14 LEGAL STANDARD 15 Rule 14(a)(1) provides, in pertinent part, that with the court’s leave, “a defending 16 party may, as third-party plaintiff, serve summons and complaint on a non party who is or 17 may be liable to it for all or part of the claim against it.” Accordingly, a third-party claim 18 may be asserted under Rule 14(a)(1) only when the third-party’s liability is in some way 19 dependent on the outcome of the main claim, or when the third-party is secondarily liable 20 to the defending party. See Stewart v. Am. Int’l Oil and Gas Co., 845 F.2d 196, 199–200 21 (9th Cir. 1988). In other words, a defendant bringing a third-party claim must be attempting 22 to transfer to the third-party a liability asserted by the original plaintiff against that 23 defendant. Id. at 200; C. Wright, et al., 6 Federal Practice and Procedure § 1446 (3d ed. 24 2018). 25 Whether to grant a Rule 14(a)(1) impleader motion rests in the sound discretion of 26 the trial court. United States v. One Mercedes Benz, 708 F.2d 444, 452 (9th Cir. 1983). 27 “In a non-exhaustive list of considerations, the court will seek to balance the benefits 28 afforded by liberal federal third-party practice against the possible prejudice to the plaintiff 2 20-CV-2540 JLS (RBM) Case 3:20-cv-02540-JLS-RBM Document 44 Filed 07/19/21 PageID.235 Page 3 of 4 1 and the third-party defendant, complexity of the issues, likelihood of delay, and timeliness 2 of the motion to implead.” Three Rivers Provider Network, Inc. v. Jett Integration, No. 3 14cv1092 JM (KSC), 2015 WL 859448, at *7 (S.D. Cal. Feb. 27, 2015) (citing Irwin v. 4 Mascott, 94 F. Supp. 2d 1052, 1056 (N.D. Cal. 2000)). 5 ANALYSIS 6 Here, Cleancor satisfies the requirements for impleader. With respect to Rule 14’s 7 derivative liability requirement, the basis for Cleancor’s proposed complaint is that 8 Cleancor leased a liquid natural gas tank trailer to Phillips, and that the lease agreement 9 included an indemnity clause. See Ex. A ¶¶ 7, 9, ECF No. 39-2. Cleancor alleges the 10 agreement requires Philips to defend or indemnify Cleancor “for any claims arising from 11 or relating to injury to any personal property, from whatever the cause, by reason of any 12 spill or leak.” Id. ¶ 9. In its third-party complaint against Cleancor, Applied alleges 13 Cleancor is at least partially liable for the fire at issue in this action because of Cleancor’s 14 failure to comply with safety procedures related to the tank trailer. See ECF No. 9, ¶ 6. 15 The allegations set forth in Cleancor’s proposed third-party complaint could possibly 16 impose liability on Phillips. Accordingly, without addressing the merits or ultimate 17 viability of the third-party complaint, this threshold requirement is satisfied. 18 With regard to timeliness and prejudice, the Court finds that the other Parties to this 19 action and Phillips will not be prejudiced. The Court set June 21, 2021, as the deadline to 20 join other parties, amend pleading, or file additional pleading, see ECF No. 37, and 21 Cleancor timely filed the present Motion. The Court also finds that Phillips’s joinder will 22 not substantially complicate the action, and the impact on the timely resolution of this case 23 will not be seriously compromised. The Court concludes that the judicial economy benefits 24 of allowing Cleancor to implead Phillips outweigh any prejudice. 25 CONCLUSION 26 Accordingly, the Court GRANTS Defendants’ Motion (ECF No. 39). Therefore, 27 the Court VACATES the hearing date set for July 22, 2021, at 1:30 p.m. Cleancor SHALL 28 /// 3 20-CV-2540 JLS (RBM) Case 3:20-cv-02540-JLS-RBM Document 44 Filed 07/19/21 PageID.236 Page 4 of 4 1 file the third-party complaint attached to its Motion within seven (7) days of the electronic 2 docketing of this Order. 3 4 IT IS SO ORDERED. Dated: July 19, 2021 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4 20-CV-2540 JLS (RBM)

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