Wylie v. Powerscreen International Distribution, Ltd et al

Filing 32

RULING (see attached) granting Defendants' unopposed 31 Motion for Leave to File Third Party Complaint. For the reasons described in the attached Ruling, Defendants may serve their third-party complaint forthwith and must e-file said third-party complaint on or before February 3, 2017. Signed by Judge Charles S. Haight, Jr. on January 30, 2017. (Kahl, A)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF CONNECTICUT

GRAHAM WYLIE,
Plaintiff,
v.

3:16-cv-00464 (CSH)

POWERSCREEN INTERNATIONAL
DISTRIBUTION, LTD, and
POWERSCREEN USA, LLC,

JANUARY 30, 2017

Defendants.

RULING ON DEFENDANTS' MOTION FOR LEAVE TO FILE THIRD PARTY
COMPLAINT [DOC. 31]
HAIGHT, Senior District Judge:
I.

Background1
Defendant Powerscreen International Distribution Ltd. manufactured a Powerscreen Warrior

1800 Screener (the "Screen") and distributed it to Defendant Powerscreen USA, LLC a product
seller and distributor in the United States, who in turn sent the screen to Powerscreen Connecticut,
LLC in Connecticut. Doc. 1 at 1. Powerscreen Connecticut, LLC employed Plaintiff Graham Wylie.
Id. On March 24, 2014, while demonstrating the product to a customer, Plaintiff fell off the end of
the platform of the product and broke his spine. Id. at 4-5 ¶¶ 9-22. Plaintiff alleges that the Screen
was defectively designed and manufactured with insufficient warnings. Id. at 6 ¶ 27.
Plaintiff filed the instant action on March 22, 2016. Doc. 1. Plaintiff brings two Connecticut
products liability claims in this action: (1) a claim pursuant to Conn. Gen. Stat. § 52-572m et seq.

1

The facts recounted here are assumed only for purposes of this Ruling.

against manufacturer Powerscreen International Distribution Ltd., and (2) a claim pursuant to Conn.
Gen. Stat. § 52-572m et seq. against Powerscreen USA, LLC as seller of the product. Id. at 6 ¶ 23.
Plaintiff's Complaint recites that he cannot directly sue his employer, Powerscreen Connecticut, LLC
by statute. Id. at 4 ¶ 8. Plaintiff seeks monetary damages, costs associated with the litigation and
any other remedies deemed appropriate by this Court. Id. at 14.
The Court has jurisdiction over this action solely based on the diversity of citizenship. 28
U.S.C. § 1332. Defendants filed an Amended Answer to Plaintiff's Complaint on June 7, 2016.
Docs. 21-22. The Court entered a Scheduling Order on June 13, 2016 with the deadline for the
completion of fact discovery on or before April 28, 2017. Doc. 26.
On December 21, 2016, Defendants filed the instant motion ("Motion") for leave to file a
third party complaint against Plaintiff's employer, Powerscreen Connecticut, LLC asserting "a
contractual right of indemnity that the Defendants possess against Powerscreen Connecticut, which
requires Powerscreen Connecticut to defend, indemnify, and hold the Defendants harmless for
Plaintiff's claim" in this action. Doc. 31 at 1. Defendants have attached its proposed third party
complaint as Exhibit A to its motion and filed a Memorandum of Law ("Defs. Br.") in support of
their motion. Doc. 31. The contractual indemnity comes from the "Terms and Conditions on
Invoice PS1-005132 and the Machine Sales Order and Confirmation issued by Powerscreen USA"
related to the Screen. Doc. 31, Ex. A ¶ 11.
In support of their motion, Defendants argue that allowing leave to serve the third party
complaint supports judicial economy by saving Defendants from filing an entirely separate action.
Defs. Br. at 3. Defendants assert that their claim will not in any way prejudice Plaintiff or impact
his damages and that the claim will not unduly complicate the case or delay the trial because it is

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a "simple contractual claim" and the case is "still in the early stages of discovery." Id. Defendants
also argue that the claim is not "obviously unmeritorious" as it is based on "clear, express
contractual language providing them with a right[] of defense and indemnity." Id.
Plaintiff did not respond or object to Defendant's motion for leave to file the third party
complaint. The time to file such a response has expired. See D. Conn. L. Civ. R. 7(a)(2) (“Unless
otherwise ordered by the Court, all opposition memoranda shall be filed within twenty-one (21) days
of the filing of the motion."). The Motion is ripe for decision.
II.

Standard of Review
Federal Rule of Civil Procedure 14(a)(1) provides that "[a] defending party may, as third-

party plaintiff, serve a summons and complaint on a nonparty who is or may be liable to it for all or
part of the claim against it." Rule 14(a) "promote[s] judicial economy by eliminating the need for
a defendant to bring a separate action against a third-party who may be secondarily or derivatively
liable to the defendant for all or part of the plaintiff’s claim." Hines v. Citibank, N.A., No. 96-2565,
1999 WL 440616, *2 (S.D.N.Y. June 28, 1999) (citing Gross v. Hanover Ins. Co., 138 F.R.D. 53,
54 (S.D.N.Y. 1991)); see also Rodolico v. Unisys Corp., 189 F.R.D. 245, 249 (E.D.N.Y. 1999).
Nonetheless, "the right to implead third parties is not automatic." Consol. Rail Corp. v. Metz, 115
F.R.D. 216, 218 (S.D.N.Y. 1987) (citing Oliner v. McBride's Indus., Inc., 106 F.R.D. 14, 20
(S.D.N.Y. 1985)).
"The decision whether to permit a defendant to implead a third-party defendant rests in the
trial court's discretion." Kenneth Leventhal & Co. v. Joyner Wholesale Co., 736 F.2d 29, 31 (2d Cir.
1984) (per curiam) (citing Laffey v. Nw. Airlines, Inc., 567 F.2d 429, 477 (D.C. Cir. 1976)); see also
Nova Prods. Inc. v. Kisma Video, Inc., 220 F.R.D. 238, 240 (S.D.N.Y. 2004) (citing Kenneth

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Leventhal & Co., 736 F.2d at 31). Leave should be "freely granted 'unless to do so would prejudice
the plaintiff, unduly complicate the trial, or would foster an obviously unmeritorious claim.'" Wilson
v. Home Depot U.S.A., Inc., No. 11-1000, 2012 WL 5463298, at *1 (D. Conn. Nov. 8, 2012)
(quoting Farrell Family Ventures, LLC v. Sekas Assocs., LLC, 863 F. Supp. 2d 324, 331 (S.D.N.Y.
2012)).
In general, "[i]mpleader is appropriate when the third-party defendant's liability to the thirdparty plaintiff is dependent upon the outcome of the main claim or the third-party defendant is
potentially secondarily liable as a contributor to the defendant." Id. (quoting Too, Inc. v. Kohl's
Dep't Stores, Inc., 213 F.R.D. 138, 140 (S.D.N.Y. 2003)) (internal quotation marks omitted); see
also Bank of India v. Trendi Sportswear, Inc., 239 F.3d 428, 438 (2d Cir. 2000) ("To sustain an
impleader action, the third-party . . . must be liable secondarily to the original defendant . . . for all
or part of the plaintiff's . . . recovery . . . . This means that the impleader action must be dependent
on, or derivative of, the main . . . claim." (citations, internal quotation marks, and bracketed material
omitted)). Thus, impleader is often "successfully utilized when the basis of the third-party claim is
indemnity." Charles Alan Wright et al., 6 Fed. Prac. & Proc. § 1446, at 377 (3d ed. Westlaw April
2016).
III.

Discussion
Before considering the substance of Defendants' third party claim, it is incumbent on the

Court to determine whether there is adequate subject matter jurisdiction over that claim. Defendants
assert that jurisdiction over the third party claims exists pursuant to this Court's supplemental
jurisdiction, 28 U.S.C. § 1367. See Defs. Br. at 2. Section 1367 provides that "in any civil action
of which the district courts have original jurisdiction, the district courts shall have supplemental

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jurisdiction over all other claims that are so related to claims in the action within such original
jurisdiction that they form part of the same case or controversy under Article III of the United States
Constitution." 28 U.S.C. § 1367(a). "Such supplemental jurisdiction shall include claims that
involve the joinder or intervention of additional parties." Id. "It is well-settled that a third-party
action for indemnification comes within a court's ancillary jurisdiction." Bank of India, 239 F.3d
at 436-37. Thus, the Court has subject matter jurisdiction over Defendants' third party claim
pursuant to § 1367.2
The Court next examines the substance of the proposed third party claim to determine
whether it alleges an "obviously unmeritorious claim." See Wilson, 2012 WL 5463298, at *1
(internal quotation marks and citation omitted). Pursuant to Connecticut state law,3 "to state a
contract-based indemnification claim, the claimant must allege either an express or implied
contractual right to indemnification." Danbury Bldgs., Inc. v. Union Carbide Corp., 963 F. Supp.
2d 96, 103 (D. Conn. 2013) (internal quotation marks and citation omitted). Defendants' Third Party

2

The exceptions that permit a Court to decline the exercise of supplemental jurisdiction,
28 U.S.C. § 1367(c)(1)-(4), are inapplicable here.
3

Neither Defendants' brief nor the Third Party Complaint assert which state law would
apply to determine the contractual indemnity claim. The Court assumes that Connecticut law
would apply as it appears to have the most significant relationship to the contract. See Levy v.
Gen. Elec. Co., No. 15-857, 2015 WL 7722389, *2 (D. Conn. Nov. 30, 2015) (holding that in
diversity cases a "Connecticut federal court will apply Connecticut's choice of law rules" and
that choice of law for a contract claim is "determined according to the most significant
relationship test of the Restatement (Second) Section 188, which provides that unless another
state has an overriding policy-based interest in the application of its law, the law of the state in
which the bulk of the contracting transactions took place should be applied" (citing Reichhold
Chems., Inc. v. Hartford Accident & Indem. Co., 243 Conn. 401, 414 (1997))). To the extent
Defendants seek to apply another state's laws or assert a different legal basis for such a claim,
Defendants must so correct the Third Party Complaint and file a corrected motion seeking leave
of this Court to serve such a Complaint.
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Complaint asserts one cause of action, contractual indemnification based upon an express provision
in the "Terms and Conditions on Invoice PS1-005132 and Machine Sales Order and Confirmation."
Doc. 31, Ex. A ¶ 11. The indemnity included in the agreement appears to cover claims made by
Powerscreen Connecticut, LLC's employees, even those based on the negligence "relating to the
manufacture [and] design" of the Screen. Id. ¶ 12. Thus, Defendants have plausibly alleged a
contractual indemnification claim against Powerscreen Connecticut, LLC.4
IV.

Conclusion
For the foregoing reasons, the Court hereby GRANTS Defendants' Motion for Leave to File

Third-Party Complaint (Doc. 31). Pursuant to Federal Rule of Civil Procedure 14(a)(1), Defendants
may serve a summons and their third-party complaint upon Powerscreen Connecticut, LLC forthwith
and e-file said third-party complaint on or before February 3, 2017. The Court notes that the
deadlines already set for this action must be adhered to unless a party or third party files for an
extension, which will only be granted for good cause shown.

4

Despite Connecticut's worker's compensation statutory scheme that makes it the
exclusive remedy for employees' claims against employers (thus shielding them from products
liability actions), Defendants may likely maintain their indemnity claim against Plaintiff's
employer in light of the independent contractual obligation. See Thibeault v. Mark Indus., No.
50-43-96,1992 WL 361779, at *1-2 (Conn. Super. Ct. Nov. 30, 1992) (applying independent
relationship test to products liability indemnification claim against employer); see also Barry v.
Quality Steep Prods. Inc., 263 Conn. 424, 451 (2003).
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It is SO ORDERED.
Dated: New Haven, Connecticut
January 30, 2017

/s/ Charles S. Haight. Jr.
CHARLES S. HAIGHT, JR.
SENIOR UNITED STATES DISTRICT JUDGE

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