Great Northern Insurance Company v. Recall Total Information Management, Inc. et al
Filing
59
MEMORANDUM OPINION. Signed by Judge Theodore D. Chuang on 10/14/2014. (aos, Deputy Clerk)
UNITED STATES DISTRICT COURT
DISTRICT OF MARYLAND
GREAT NORTHERN INSURANCE
COMPANY, as subrogee of Wilmer Cutler
Pickering Hale and Dorr, LIP,
Plaintiff,
v.
Civil Action No. TDC-13-1829
RECALL TOTAL INFORMATION
MANAGEMENT, INC., ef 01.,
Defendants.
MEMORANDUM
OPINION
Before the Court is a Motion for Reconsideration, ECF No. 49, tiled by Defendants
Recall Total Information Management, Inc. and Recall Secure Destruction Services, Inc.
(collectively, "Recall"), in which Recall requests that the Court reconsider its prior decision to
deny Recall's Motion to Dismiss Counts I, II, and III of the First Amended Complaint. In the
alternative, Recall requests that the Court strike Paragraphs 15, 16,25,27,29,30,
& 34(a), (b),
(c), (e), (t), (g), (h), (I), (m), (n), (p), (q), (r), & (s) of the First Amended Complaint.
Having
reviewed the pleadings, the Court finds no hearing necessary. See Local Rule 105.6 (D. Md.
2014). For the following reasons, Recall's Motion is DENIED.
BACKGROUND
This dispute arises from an accident that occurred on June 28, 2012, during which a large
section of the roof of Recall's document storage warehouse collapsed, killing a Recall worker
and causing the destruction of property, including property that belonged to the nonparty
subrogor of Plaintiff Great Northern Insurance Company ("Great Northern"). Great Northern
brought suit against Recall; Lorenzo Piard ("Piard"), the temporary worker who allegedly caused
the roof collapse; and Kelly Services, Inc., the temporary employment agency that hired Piard to
work at Recall.
accompanying
On August
1, 2013. the Court issued a Memorandum
Opinion
and
Order denying Recall's Motion to Dismiss Counts I, II, and III of the First
Amended Complaint.
I
ECF No. 45-46. Recall filed the present Motion 14 days later, requesting
that the Court reconsider its decision under Federal Rule of Civil Procedure 54(b).
As the
relevant facts in this case are explained in the Memorandum Opinion, ECF No. 45, the Court will
not repeat them here.
DISCUSSION
I. Motion for Reconsideration
Because the Court's ruling on the Motion to Dismiss was an interlocutory order, Recall's
Motion for Reconsideration is brought under Federal Rule of Civil Procedure 54(b). Under Rule
54(b), a court may revise interlocutory orders "at any time before the entry of a judgment
adjudicating all the claims and all the parties' rights and liabilities."
Fed. R. Civ. P. 54(b).
Because the district court "retains the power to reconsider and modify" its interlocutory orders,
"[m]otions
for reconsideration
of interlocutory orders are not subject to the strict standards
applicable to motions for reconsideration of a final judgment" and are instead "committed to the
discretion of the district court." Am. Canoe Ass 'n., Inc. v. Murphy Farms, Inc., 326 F.3d 505,
514-15 (4th Cir. 2003). Among the factors that the court may consider are whether (1) there has
been an intervening change in controlling law; (2) there is additional evidence that was not
previously available; or (3) the prior decision was based on clear error or would work manifest
I Not at issue on this Motion for Reconsideration
is the Court's Memonmdum Opinion and
accompanying Order denying the separate Motion to Dismiss filed by Kelly Services, Inc. and
Piard. ECF No. 47-48.
2
injustice.
See Reyazuddin v. Montgomery Cnty., Md, No. DKC 11-0951,2012
WL 642838, at
*2-3 (D. Md. Feb. 27, 2012) (citations and internal quotation marks omitted); Beyond Sys., Inc.
v. Kraft Food,', Inc., No. PJM-08-409, 2010 WL 3059344, at *2 (D. Md. Aug. 4, 2010).
Here, Recall argues neither that there have been intervening changes in controlling law,
nor that there is additional evidence that was previously unavailable.
Instead, Recall's main
argument is that the Court erred in its consideration of certain allegations in the Complaint which
reference the Maryland Occupational Safety and Health ("MOSH") report, ECF No, 14-2, that
was attached to the First Amended Complaint. The Court, however, does not find clear error or
manifest injustice in its consideration of these allegations, nor does it find any other grounds on
which it should exercise its discretion to reconsider its prior decision.
lberefore, Recall's
Motion for Reconsideration is denied.
In its Memorandum of Law in Support of its Motion for Reconsideration, Recall restates
the argument previously made in its Motion to Dismiss that the Court should compare the
MOSH report to the Complaint and consider only the report where Great Northern's allegations
indicate they rely on the MOSH report but conflict with the contents of the report. Mem. Supp.
Mot. Recons. at 7, ECF No. 49-1. As discussed in the Court's Memorandum Opinion, generally,
an exhibit attached to the complaint prevails over the pleading when there is a conflict between
the material facts in the exhibit and the allegations of the complaint.
Fed. R. Civ. P. IO(c);
Fayetteville Inveslors v. Commercial Builders, Inc., 936 F.2d 1462, 1465-68 (4th Cir. 1991)
(relying on the time period stated in the contract and performance
bond attached to the
complaint, rather than the incorrect period alleged in the complaint. to conclude that a claim was
time-barred).
In this instance. however, the findings in the MOSH report, which is not an
evidentiary document. are the hearsay conclusions of an investigator, and therefore it would be
3
inappropriate to take everything stated in the report as true and find that it refutes the allegations
in the Complaint.
See Gan' v. Wallingford Bd of Educ., 69 F.3d 669, 674-75 (2d. Cir. 1995)
(finding that the district court erred when it adopted as true the full contents of a superintendent's
report that was attached to the complaint and found that it refuted the plaintiffs' allegations).
In its Memorandum
of Law, Recall states that it does not challenge
the Court's
application of Gam, but argues that it would be consistent with Ganl for the Court to use the
MOSH report to reject any allegation in the Complaint which Great Northern erroneously asserts
is supported by the MOSH report.
The Court, however, finds no such direct contradiction
between the MOSH report and the allegations in the First Amended Complaint.
Recall identifies several allegations in the Complaint that it claims are attributed to the
MOSH report, but in fact directly contradict statements in the MOSH report.
First, Recall takes
issue with the allegations relating to Piard's level of training and certification,
such as the
allegation that: "Based on the MOSH investigation and report, Lorenzo Piard was not properly
trained or certified to safely operate Recall's order picker inside the Recall warehouse facility.',2
Am. Compl.
125,
ECF No. 14. Recall argues that the MOSH report states only that Recall was
not in possession of a training certificate for Piard, that it "states the opposite"
Northern's
of Great
allegation that Piard was not properly trained, and that, in fact, it states, "The
employer had a copy of the evaluation with the date and name of both the operator and the
2 Great Northern makes similar allegations relating to whether Piard was properly trained and
certified elsewhere in the Amended Complaint: "Based on the investigation conducted by
[MOSH], Recall did not certify that defendant Lorenzo Piard was properly trained and certified
to operate order pickers as required ... ," id. ~ 13; "Based on MOSH's investigation, neither
Recall, Kelly, nor Mr. Piard has produced a certification from the order picker manufacturer or
an individual certified to provide training on the subject order picker confirming that Mr. Piard
was properly trdined and certified:' id. ~ 14; "Based on the MOSH investigation, Defendant
Lorenzo Piard, who was not properly trained and certified to operate an order picker ... struck
an overloaded and overstressed rack ... causing the rack to tip over onto an adjoining rack ... ,"
id. 130.
4
trainer."
Mem. Supp. Mot. Recons. at 8. The Court, however, finds no irreconcilable conflict
between the Complaint and the MOSH report. In fact, the portions of the MOSH report to which
Recall cites state, consistent with the pleadings, that Recall "did not have any documentation that
the employee had been trained in the use of the order picker," as required by Recall's safety
procedures, but that Recall did tell the MOSH investigator that it "had evaluated the operator
while he was operating the order picker" and conducted "an oral evaluation of his knowledge,"
and that it had "a copy of th[is] evaluation with the date and name of both the operator and the
trainer." MOSH Report, ECF No. 14-2, at 19,22. The report notes that under the applicable
standard operating procedures, training and certification must be "conducted by an individual
from the manufacturer or an individual certified to provide training." Jd. To find that Great
Northern's allegation is refuted by the report would require a conclusion that the report's account
of Recall's
informal
evaluation,
which the report indicates did not comply
with safety
procedures, is proof that Piard was properly trained and certified to operate the order picker. As
the Court has explained, it would be inappropriate to adopt the contents of the MOSH report in
this way.3
Second, Recall asks the Court to reject Great Northern's allegation that Piard operated the
order picker that struck the storage rack because the MOSH report does not explicitly state that it
was Piard who caused the damage. The full allegation at issue is:
Based on the MOSH investigation, Defendant Lorenzo Piard, who was not
properly trained and certified to operate an order picker, carelessly, negligently
and with disregard for the safety and property of others stored in the warehouse,
struck an overloaded and overstressed rack while operating an order picker in one
of the enclosed tunnel spaces, causing the rack to tip over onto an adjoining rack
which resulted in a domino effect of collapsing rack systems.
3 Under Gunt, the Court is not required to accept as true the arguably self-serving statements of
Defendants Recall and Piard to the MOSH investigator, as recounted in the MOSH report,
simply because the report was attached to the Complaint. See Gant, 69 F.3d at 674.
5
Am. CompI.
30.
Great Northern states in its Opposition to Recall's Motion for
Reconsideration that it based this allegation not solely on the MOSH report, but also on its own
investigation and review of Recall employee statements, which led to the identification of Piard
as the order picker operator. Opp. Mot. Recons. at 7, ECF No. 57.
A fair reading of this
allegation, therefore, is that it relies on the MOSH investigation for the circumstances of the
accident, including that it was caused by an order picker striking a shelf that caused a "domino
effect," but not necessarily for the identity of the operator. Recall is effectively asking the Court,
at this pre-discovery stage, to bar Great Northern from alleging that Defendant Piard caused the
accident because it, perhaps inartfully, failed to specify precisely which facts it derived from the
MOSH report. Notably, the MOSH report does not contradict this aJlegation. Wbere Great
Northern has represented that it has another source for this information, such a ruling would
effectively require a finding that the MOSH report's silence on the identity of the order picker
operator is conclusive evidence that Piard did not cause the accident. Such a conclusion,
particularly at the pleadings stage, is inappropriate. See Gant, 69 F.3d at 674.
Third, Recall argues that the MOSH report contradicts the allegations that, "[b]ased on
the MOSH investigation, the storage racks were overloaded, overstressed and deformed," Am.
Compl.
29; see also id. ~ 30, and that "{tJhe storage racks were designed and installed in a
manner that created small enclosed tunnels at floor level," id. ~ 27. As with the allegations
regarding Piard, the Court does not find that the MOSH report directly contradicts Great
Northern's allegations regarding the storage racks. Although the MOSH report does not use the
word "overloaded," it states that the storage racks appeared to be "overstressed and deformed,"
MOSH Report, ECF No. 14-2 at 37. Significantly, the report attacbes photographs showing
6
racks that are arguably "overloaded" and fonn enclosed tunnel-like spaces.
See id at 24, 32.
Under these circumstances, there is no basis to reject Great Northern's allegation.
Finally, Recall also takes issue with the allegation that Recall was "'involved in modifying
the building or the racks in 2000" because that allegation is not contained in the MOSH report.
Mem. Supp. Mot. Recons. at 9. However, the actual allegation on this point never attributed to
Recall the modifications to the building:
Based on the MOSH investigation and reports, Recall's warehouse was 600 feet
by 560 feet and the roof of the warehouse was approximately 36 feet high. The
roof of the building had been raised in 2000 to increase the storage space. At that
time, the buildings' [sic] columns were jacked up and the southwest comer of the
roof failed and had to be rebuilt.
Am. Compl.
26. Furthennore, as is clear from the Court's Memorandum Opinion, the Court
neither interpreted this allegation to claim that Recall had made these modifications nor relied on
that assumption in its analysis. Rather, it understood that the modifications had been performed
by others, but that Recall chose to operate the warehouse under those conditions.
See Mem. Op.
at 3-4, 9. Great Northern did make the separate allegation, which the Court relied upon, that
"[aJfter the roof of the building was raised, Recall modified its storage racks," Am. Compl. '127,
but that allegation was not linked to the MOSH report and thus presumably is based on other
sources of information. At the pleading stage, there is no basis to reject such an allegation.
Thus, the Court finds neither clear error nor manifest injustice in its consideration of the
pleadings and the MOSH Report in its prior decision to deny Recall's Motion to Dismiss, nor
does it find any other grounds on which it should exercise its discretion to reconsider that
decision. Accordingly, the Motion for Reconsideration is denied.
7
II. Motion to Strike Pleadings
In the alternative, Recall asks that the Court strike Paragraphs IS, 16, 25, 27, 29, 30, &
34(a), (b), (c), (c), (I), (g), (b), (I), (m), (n), (p), (q), (r), & (s) of the First Amended Complaint,
which Recall argues "depend directly on mischaracterizing the MOSH report or that are
dependent upon mischaracterization of the MOSH report as a predicate to the claim." Mem.
Supp. Mot. Recons. at 10. Federal Rule of Civil Procedure 12(1) allows a court to strike from a
pleading "an insufficient defense or any redundant, immaterial, impertinent, or scandalous
matter." Fed. R. Civ. P. 12(1). Rule 12(1) motions are "generally viewed with disfavor because
striking a portion of a pleading is a drastic remedy." Waste Mgmt. Holdings, Inc. v. Gilmore,
252 F.3d 316, 347 (4th Cir. 200\) (citations and internal quotation marks omitted). As discussed
above, the Court finds that these allegations do not directly contradict or mischaracterize the
MOSH report and thus finds no basis to strike them.
Recall further argues that the paragraphs it has identified are "immaterial because they
can never be proven as true" and prejudicial because they will put Recall in a position to "defend
a claim of gross negligence based on alleged findings and conclusions that do not exist." Mem.
Supp. Mot. Recons. at 10-11. However, a court should grant a Rule 12(1) motion only in cases
where the pleadings are clearly immaterial. See Rackley v. Bd Trustees
0/ Orangeburg
Reg 'f
Hasp., 310 F.2d \4\, \43 (4th Cir. \962) (holding that the district court should not have stricken
a paragraph in the complaint where "it did not conclusively appear that this circumstance was not
germane to the claimants' case"). An opposing party's prediction that an allegation will never be
sufficiently proven does not satisfy this high bar, nor does Recall cite any case law that suggests
that it docs. Therefore, Recall's Motion to Strike Paragraphs 15, 16,25,27,29,30,
(c), (e), (I), (g), (h), (I), (m), (n), (p), (q), (r), & (s) is denied.
8
& 34(a), (b),
CONCLUSION
For the foregoing reasons, Recall's
Motion for Reconsideration
of Order Denying
Recall's Motion to Dismiss First Amended Complaint or in the Alternative to Strike Paragraphs
is denied. A separate Order follows.
Date: October 14, 2014
9
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?