Warren W. Fane, Inc. v. Tri-State Diesel, Inc. et al

Filing 61

DECISION AND ORDER granting Defts' 33 , 34 , and 35 Motions for Summary Judgment. Signed by Senior Judge Thomas J. McAvoy on 5/7/14. (sfp, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
-------------------------------WARREN W. FANE, INC.,
Plaintiff,
v.

No.

1:12-cv-1903

TRI-STATE DIESEL, INC.,
KENWORTH TRUCK COMPANY, and
CUMMINS NORTHEAST, INC.,
Defendant.
-------------------------------THOMAS J. McAVOY
Senior United States District Judge
DECISION and ORDER
Plaintiff commenced the instant action against Defendants, alleging that they
violated warranties and contracts in delivering tractors that failed to perform as
promised. Presently before the Court are Defendants’ motions for summary judgment
pursuant to Federal Rule of Civil Procedure 56(a). See dkts. # 33-35.
I.

FACTS
This case concerns Plaintiff’s purchase of ten tractors manufactured by

Defendant Kenworth Truck Company (“Kenworth”) from Defendant Tri-State Diesel, Inc.
(“Tri-State”). The tractors’ engines were manufactured by Defendant Cummins
Northeast, LLC (“Cummins”). Plaintiff contends that the tractors, which were purchased
to haul heavy loads as a part of Plaintiff’s trucking business, were defective, did not
perform properly or as promised, and caused Plaintiff’s business considerable
disruption and loss of income. Plaintiff alleges that Defendants’ conduct breached

warranties and contracts between the parties and demands a variety of damages.
Plaintiff Warren W. Fane, Inc., is an excavating and hauling company based
in Mechanicville, New York. (Defendant Kenworth’s Statement of Material Facts, dkt. #
33-1 (“Kenworth’s Statement”), at ¶ 1).1 In or around September 2010, Plaintiff, through
its President and Owner, Warren W. Fane, decided to purchase ten new trucks. (Id. at
¶ 2). One of the reasons for purchasing these new trucks was Plaintiff’s concerns
about new Environmental Protection Agency regulations. (Id.). Plaintiff also sought
new trucks as part of its regular purchase of vehicles for the business. (Plaintiff’s
Statement of Material Facts in Response to Defendant Kenworth’s Statement, dkt. #
43-1 (“Plaintiff’s Response to Kenworth”) at ¶ 2). Greg Fane, who had many years
experience in purchasing trucks, served as Plaintiff’s chief negotiator. (Kenworth’s
Statement, at ¶ 3-4; Plaintiff’s Response to Kenworth, at ¶ 3-4). Greg and Warren
Fane were both very experienced and knowledgeable in the hauling industry and in
reference to the truck specifications required for efficient hauling. (Kenworth’s
Statement, at ¶ 5).
Defendant Cummins Northeast, LLC, (“Cummins”), is the northeast regional
distributor for Cummins Inc. (Defendant Cummins Northeast, LLC’s State of Material
Facts, dkt. 35-1 (“Cummins Statement”) at ¶ 2). Cummins provides warranty service
and parts for diesel engines that Cummins, Inc., manufactures. (Id. at ¶ 3). Cummins

1

The Court will cite to the Defendants’ statements for material facts which are
uncontested. The Court will note where disputes over facts exist. Each of the
Defendants filed a statement of material facts, and Plaintiff responded to each one.
The Court will add facts from the other Defendants’ statements and Plaintiff’s
responses to them, as necessary.
2

does not manufacture diesel engines or sell such engines to truck manufacturers like
Kenworth, but did provide repairs to the engines at issue in this case. (Id. at ¶ 4;
Plaintiff’s Response to Defendant Cummins Northeast, LLC’s Statement of Material
Facts and Statement of Additional Material Facts, dkt. #42-1, (“Plaintiff’s Response to
Cummins”) at ¶ 4).
Plaintiff sought trucks and engines with similar capabilities to those already in
its fleet. (Plaintiff’s Response to Kenworth at ¶ 6). Greg Fane testified that Plaintiff had
a set of specifications that it was seeking in the new trucks. (See Greg Fane
Deposition, Exh. B to Defendant Kenworth’s Motion for Summary Judgment, dkt. # 33,
at 11-13). Plaintiff sought a thirteen-speed manual transmission, 14,600-pound front
axle, 46,000-pound rear axle, a 391 gear ratio, and an engine similar to the 475horsepower Caterpillar engines on other trucks owned by Plaintiff. (Id.). Kenworth
models offered a 485-horsepower Cummins engine, which to Greg Fane seemed
similar to the Caterpillar engine with which Plaintiff was familiar. (Id. at 15). Greg Fane
did not do any independent research on Kenworth Trucks and Cummins engines before
purchasing the truck, though he did consult with Warren Fane. (Kenworth’s Statement
at ¶ 7; Plaintiff’s Response to Kenworth at ¶ 7). Warren Fane himself did not do
research prior to purchasing trucks, though the Plaintiff notes that he “continually
received literature regarding the newest lines of trucks and engines, including those
manufactured by Cummins.” (Kenworth Statement at ¶ 9, Plaintiff’s Response to
Kenworth at ¶ 9). Defendant Kenworth alleges that Warren Fane relied on information
from colleagues in the trucking industry in deciding to seek trucks with a 485horsepower Cummins engine, but did not rely on any advertising when deciding to
3

purchase the trucks. (Kenworth’s Statement at ¶¶ 8, 10). Plaintiff alleges that Fane
relied on the representations of Defendant’s agent, Thomas Jennings, about the
performance he could expect from the 485-horsepower Cummins engine. (Plaintiff’s
Response to Kenworth at ¶¶ 8, 10).
Plaintiff solicited prices from several dealers in the area before deciding to
purchase ten Kenworth vehicles from Defendant Tri-State. (Kenworth Statement at ¶
11). Plaintiff alleges that price alone did not guide its decision to purchase the trucks
from Defendants; Plaintiff also relied on assurances from Defendant that the trucks
would offer performance comparable to Plaintiff’s current fleet. (Plaintiff’s Response to
Kenworth at ¶ 11). Plaintiff purchased eight tandem trucks and two tri-axle trucks.
(Kenworth Statement at ¶ 12). Warren and Greg Fane negotiated the truck sale over
the telephone with Thomas Jennings. (Id. at ¶ 13; Plaintiff’s Response to Kenworth at ¶
13). They did not meet Jennings in person or inspect any trucks before the purchase.
(Id.). Plaintiff initially relayed exact specifications to Defendant, including the purchase
of a 485–horsepower Cummins engine. (Kenworth Statement at ¶ 14; Plaintiff’s
Response to Kenworth’s Statement at ¶ 14). Plaintiff alleges that Thomas Jennings
recommended that Fane purchase the trucks at issue. (Plaintiff’s Statement at ¶ 14).
On Jennings’ recommendation, Plaintiff purchased trucks with horsepower greater than
the 485-horsepower engines that Plaintiff originally sought. (Kenworth Statement at ¶
15). Jennings made this recommendation after being informed of how Plaintiff intended
to use the trucks. (Id.). The parties disagree about whether Jennings actually
recommended to Greg Fane that Plaintiff purchase trucks with 500-horsepower
Cummins engines. (See Kenworth’s Statement at ¶¶ 15-16; Plaintiff’s Response to
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Kenworth’s Statement at ¶¶ 15-16). Defendant alleges that Jennings recommended
purchasing a 525-horsepower engine, while Plaintiff insists that Jennings did not
recommend an engine that large. (Kenworth’s Statement at ¶ 17; Plaintiff’s Statement
at ¶ 17).
Plaintiff placed an order for the ten Kenworth trucks from Tri-State on August
16, 2010. (Kenworth’s Statement at ¶ 18). The trucks each had a 500-horsepower
Cummins ISXI5 engine. (Id.; Cummins Statement at ¶ 9). Tri-State inspected the
trucks upon receipt. (Kenworth’s Statement at ¶ 19). Greg Fane periodically examined
these trucks as they arrived at Tri-State to ensure that they contained all of the
components that Plaintiff had requested. (Id. at ¶ 20). William Deegan, Plaintiff’s office
manager, inspected the trucks to ensure that they matched the purchase orders when
those trucks were delivered to Plaintiff. (Id. at ¶ 21). Deegan’s inspections revealed
that the trucks matched the specifications required in the purchase contract, with the
exception that two trucks had a lower rating on the axles than requested. (Id. at ¶ 22).
Plaintiff denies that the trucks matched the requirements in the purchase order, but
“admits that based upon Mr. Deegan’s inspection of the trucks it appeared that, minus
two trucks with an incorrect rating, the trucks delivered matched the specifications
agreed to by Plaintiff and Tri-State.” (Plaintiff’s Response to Kenworth’s Statement at ¶
22). Plaintiff admits that Tri-State corrected the improper axle ratings when brought to
Defendant’s attention. (Id. at ¶ 23). Plaintiff eventually approved and took possession
of the ten trucks. (Kenworth’s Statement at ¶ 24). Plaintiff did not have any contact
with anyone at Defendant Kenworth before taking delivery of the trucks. (Id. at ¶ 25).

5

When Plaintiff agreed to purchase the trucks, Plaintiff received and executed
Retail Purchase Orders for the two tri-axle trucks and eight tandem tractors. (Id. at ¶
26). The Purchase Orders contained all the specifications for the trucks Plaintiff
purchased. (Id. at ¶ 27). They did not contain any estimates for fuel mileage. (Id. at ¶
29). The Orders indicated that Plaintiff intended to purchase an extended warranty for
five years and 400,000 miles on the Cummins engine. (Id. at ¶ 28). Plaintiff executed
the Retail Purchase Orders, which indicates that Plaintiff approved the specifications
contained in the Orders. (Id. at ¶ 30). Plaintiff contends, however, that Plaintiff’s
acceptance of the specifications contained on the Orders was premised, in part, on
Thomas Jennings’ promises about the trucks’ capabilities. (Plaintiff’s Response to
Kenworth at ¶ 30).
In or about November 2010, Jennings provided Plaintiff with Kenworth’s
invoices for the purchase, as well as the Kenworth Truck Company Limited Warranty
Agreement–Class 8 Standard Service Warranty, the Cummins Plan 11 Warranty
Agreement and a form for component extended coverage election forms. (Kenworth’s
Statement at ¶ 31). Jennings also traveled to Plaintiff’s facility to go over all of the
documents with Plaintiff prior to having Plaintiff execute them. (Id. at ¶ 32). Jennings
specifically reviewed and discussed the Kenworth Warranty and the Cummins Warranty
with Plaintiff. (Id. at ¶ 33). Plaintiff signed the invoices and the Kenworth Warranty.
(Id. at ¶ 34). Plaintiff declined extended warranties on the components, but did sign an
extended Cummins Warranty. (Id. at ¶ 35).
The Kenworth Warranty expressly disclaims any warranties other than those
contained in the agreement, and expressly disclaims any warranties for merchantability
6

or fitness for a particular purpose. (Id. at ¶ 36). The Kenworth warranty also excludes
from coverage the engine or engine accessories. (Id. at ¶ 37). The Kenworth warranty
also provides that the warranty applies only to original factory equipment and is subject
to the terms and conditions contained in the warranty. (Id. at ¶ 38). The warranty limits
remedies under the warranty to repair or replacement of failed parts. (Id. at ¶ 39). No
coverage is provided for incidental and consequential damages. (Id.). Warren Fane
signed the warranty on Plaintiff’s behalf. (Id. at ¶ 40).
The warranty provided by Defendant Cummins applied expressly to the new
EPA 2010 ISXI1.9 and ISXI5 series engines that had been sold by Cummins. (Id. at ¶
41). The Cummins warranty covered any failures of the Engine under normal use and
service caused by defects in Cummins material or factory workmanship. (Id. at ¶ 42).
Cummins promised to pay for all parts and labor needed to repair damage to the engine
from warrantable failure. (Id. at ¶ 43). Plaintiff purchased an extended warranty, which
increased the warranty from two years and 250,000 miles to five years and 500,000
miles. (Id. at ¶ 44).
Warren Fane admitted at his deposition that the instant action in this case
concerns the performance of the Cummins engine. (Id. at ¶ 45). Plaintiff
acknowledges that the case concerns problems with the engine, but alleges as well that
the lawsuit concerns the supposed failure of Kenworth and Tri-State to address
problems with the vehicles and engines at issue. (Plaintiff’s Response to Kenworth at ¶
45). The engines in the trucks Plaintiff purchased suffered from performance issues.
(Kenworth’s Statement at ¶ 46). Plaintiff emphasizes that problems with the trucks’ fan
hubs and flexible exhaust pipes also occurred. (Plaintiff’s Response to Kenworth’s
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Statement at ¶ 46). Problems with the trucks’ engines included lack of hauling power,
backfiring and/or coughing, lurching, constant illumination of check-engine lights and
engine deratings, which required Plaintiff to take the trucks out of service. (Kenworth’s
Statement at ¶ 47). Plaintiff blamed the problems with coughing, loss of power, lurching
and poor fuel mileage on the engines. (Id. at ¶ 48). The trucks jerked when ascending
on elevated roads, had a coughing problem that appeared to stem from the trucks’
turbo chargers, and suffered breakdowns due to engine issues. (Id. at ¶ 50). The fuel
mileage on the trucks was less than that on comparable vehicles in Plaintiff’s fleet. (Id.
at ¶¶ 51-52). All ten of the trucks Plaintiff purchased had similar problems. (Id. at ¶
53).
In November 2011, Cummins replaced the turbo charges on every truck and
recalibrated the engines’ Electronic Control Modules to increase their horsepower from
500 to 525. (Id. at ¶ 54). Kenworth alleges that this repair resolved the coughing and
lurching issues, but that problems with engine power and fuel economy persisted. (Id.
at ¶ 55). Without pointing to contrary evidence, Plaintiff denies these claims. (Plaintiff’s
Response to Kenworth’s Statement at ¶ 55). The deposition of William Deegan, cited
by Defendant for this proposition, indicates that the repairs made the coughing stop, but
that other problems persisted. (William Deegan Deposition, Exh. C to Defendant
Kenworth’s Motion, at 56). The parties disagree over whether Defendant ever
requested that Tri-State take the trucks back and refund the purchase price.
(Kenworth’s Statement at ¶ 56; Plaintiff’s Response to Kenworth at ¶ 56). Plaintiff
informed Defendant of the problems with the truck and demanded an adequate
remedy. (See Exh. I to Plaintiff’s Response, dkt. # 49).
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Faced with problems that were “continual,” William Deegan began keeping a
handwritten log of the problems and the amount of time those problems kept trucks out
of service. (Kenworth’s Statement at ¶ 57). Defendant contends that Plaintiff
eventually created a truck-by-truck table of problems, testing, and any resolution of
those problems from Deegan’s notes. (Id. at ¶ 58). Plaintiff admits to using the notes
to respond to discovery requests. (Plaintiff’s Response to Kenworth at ¶ 58). The
notes identified engine problems. (Kenworth’s Statement at ¶ 59). They also described
a variety of efforts to make the trucks function as Plaintiff expected. (Kenworth’s
Statement at ¶ 60; Plaintiff’s response to Kenworth’s Statement at ¶ 60).
Beyond issues with the engines, the charts created by Plaintiff also note
numerous problems with air sensors, flex pipes, and fan hubs, which were covered by
the Kenworth Warranty. (Kenworth’s Statement at ¶ 61; see also Exh. A to Plaintiff’s
Brief in Opposition to Kenworth’s Motion, dkt. # 43-3). Deegan and Warren Fane
admitted that the exhaust pipe and fan hub replacements were minor jobs. (Kenworth’s
Statement at ¶¶ 62-3). Plaintiff admits that Deegan made this statement, but contends
that “Plaintiff lost use of the trucks during the time period that exhaust pipe and fan
hubs were being replaced[.]” (Plaintiff’s Response to Kenworth’s Statement at ¶¶ 6263). Moreover, the labor required to replace the parts was performed by Plaintiff’s
employees. (Id.). The fan hubs and flex pipes that were replaced were covered by the
Kenworth warranty. (Kenworth’s Statement at ¶¶ 64-65). Plaintiff points out, however,
that Plaintiff’s employees performed the labor. (Plaintiff’s Response to Kenworth’s
Statement at ¶¶ 64-65). Plaintiff admits that Plaintiff elected to have the fan hubs and
flex pipes sent to its facility to have Plaintiff’s mechanics install the new parts.
9

(Kenworth’s Statement at ¶ 66; Plaintiff’s Response to Kenworth’s Statement at ¶ 66).
The repairs took about 30 minutes to perform, but Plaintiff complains that Fane lost use
of the trucks during the time when these parts were being replaced. (Kenworth’s
Statement at ¶ 67; Plaintiff’s Response to Kenworth’s Statement at ¶ 67). The only
other problems with the vehicles that did not involve the Cummins engines were broken
air sensors and excessive anti-freeze use on the two tri-axle trucks. (Kenworth’s
Statement at ¶ 68). These issues were fully resolved under the Kenworth warranty.
(Id.).
Plaintiff admits that Fane did not have to pay for any warranty repairs to the
trucks or for any replacement parts, but alleges that it was required to “pay for (i) the
loss of use of the trucks while the repairs were being performed, (ii) added fuel and fuel
additive costs associated with the lower than anticipated and represented fuel
economy; and (iii) additional administrative costs associated with truck and engine
failures.” (Kenworth’s Statement at ¶ 69; Plaintiff’s Response to Kenworth at ¶ 69).
Plaintiff eventually replaced all of the vehicles in question with vehicles manufactured
by a competitor. (Kenworth’s Statement at ¶ 70). Plaintiff traded in the Kenworth trucks
on those new vehicles. (Id.). In calculating damages, Plaintiff includes losses due to
the resale of the trucks, loss of use of the trucks, increased fuel costs due to lowerthan-expected gas mileage, lost time for trips taken to get trucks repaired, and lost time
for workers whose trucks broke down or required repair. (Kenworth’s Statement at ¶ 71
71; Plaintiff’s Response to Kenworth’s statement at ¶ 71).
Plaintiff filed a Complaint in the Supreme Court of New York, Rensselaer

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County, November 20, 2012. See Notice of Removal, dkt. #1, at ¶ 1. Defendant
Cummins Northeast, Inc., removed the action to this Court on December 28, 2012. Id.
After the parties engaged in discovery, Defendants filed motions for summary
judgment, bringing the case to its present posture.
II.

ANALYSIS
A.

Legal Standard

Defendants seek summary judgment. It is well settled that on a motion for
summary judgment, the Court must construe the evidence in the light most favorable to
the non-moving party, see Tenenbaum v. Williams, 193 F.3d 581, 593 (2d Cir. 1999),
and may grant summary judgment only where "there is no genuine issue as to any
material fact and . . . the moving party is entitled to a judgment as a matter of law." FED.
R. CIV. P. 56(c). An issue is genuine if the relevant evidence is such that a reasonable
jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, 477
U.S. 242, 248 (1986).
A party seeking summary judgment bears the burden of informing the court of
the basis for the motion and of identifying those portions of the record that the moving
party believes demonstrate the absence of a genuine issue of material fact as to a
dispositive issue. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the movant is
able to establish a prima facie basis for summary judgment, the burden of production
shifts to the party opposing summary judgment who must produce evidence
establishing the existence of a factual dispute that a reasonable jury could resolve in his
favor. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). A

11

party opposing a properly supported motion for summary judgment may not rest upon
"mere allegations or denials" asserted in his pleadings, Rexnord Holdings, Inc. v.
Bidermann, 21 F.3d 522, 525-26 (2d Cir. 1994), or on conclusory allegations or
unsubstantiated speculation. Scotto v. Almenas, 143 F.3d 105, 114 (2d Cir. 1998).
B.

Defendant Kenworth’s Motion

Defendant Kenworth seeks summary judgment on several grounds, which the
Court will address in turn. See dkt. # 33.
i. Breach of Express/Implied Warranty
Defendant Kenworth first argues that the Court should grant Kenworth
summary judgment on all of Plaintiff’s breach of express warranty claims. Kenworth
contends that it has met all of the obligations under the warranty agreement by
repairing the parts of the vehicle covered by the Kenworth warranty. The Plaintiff’s
complaint was with the Cummins engine, not the Kenworth vehicle. The Cummins
engine was not warrantied by Kenworth, and thus none of the issues involved in this
dispute are related to the warranty Kenworth provided. Plaintiff responds by arguing
that Defendant offered express warranties on the trucks, and breached those
warranties by delivering trucks that failed to meet the standard promised in the
warranties. Plaintiff points to the Kenworth Warranty, which promised that the trucks
delivered would “‘be free from defects in materials and factory workmanship.” Plaintiff
argues that the trucks, and not just the motors, were defective upon delivery, and the
Defendant did nothing to correct the problems. The problems that Plaintiff experienced
with fan hubs and flexible exhaust pipes continued even after making repairs.

12

Defendant also argues that Plaintiff cannot sustain any breach of implied warranty
claims. Plaintiff does not respond to this argument.
The issue here is Defendant Kenworth’s obligations under the alleged express
warranty. As a general matter, “a cause of action on an express warranty asks only
that a manufacturer make good on the contractual commitment that it voluntarily
undertook by placing that warranty on its product.” Bates v. Dow Agrosciences, L.L.C.,
544, U.S. 431, 444 (2005). In New York, a “seller can create an express warranty by
affirmation, promise, description or sample.” Kraft v. Staten Island Boat Sales, Inc., 715
F.Supp.2d 464, 472 (S.D.N.Y. 2010).2 To prevail on an express warranty claim, a
Plaintiff must “show that there was an ‘affirmation of fact or promise by the seller, the
natural tendency of which [was] to induce the buyer to purchase’ and that the warranty

2

New York’s Uniform Commercial Code provides that:

(1) Express warranties by the seller are created as follows:
(a) Any affirmation of fact or promise made by the seller to the buyer which
relates to the goods and becomes part of the basis of the bargain creates an
express warranty that the goods shall conform to the affirmation or promise.
(b) Any description of the goods which is made part of the basis of the bargain
creates an express warranty that the goods shall conform to the description.
(c) Any sample or model which is made part of the basis of the bargain creates
an express warranty that the whole of the goods shall conform to the sample or
model.
(2) It is not necessary to the creation of an express warranty that the seller use formal
words such as ‘warrant’ or ‘guarantee’ or that he have a specific intention to make a
warranty, but an affirmation merely of the value of the goods or a statement purporting
to be merely the seller’s opinion or commendation of the goods does not create a
warranty.”
NY CLS UCC § 2-313.
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was relied upon[.]” Schimmenti v. Ply Gem Indus., 156 A.D.2d 658, 659, 549 N.Y.S.2d
152, 154 (2d Dept., 1989) (quoting Friedman v. Medtronic, Inc., 42 A.D.2d 185, 190
(N.Y. App. Div., 2d Dept., 1973)); see also Promuto v. Waste Mgmt., Inc., 44 F.Supp.2d
628, 642 (S.D.N.Y. 1999) (In New York a breach of warranty claim requires a “showing
that: (1) plaintiff and defendant entered into a contract; (2) containing an express
warranty by the defendant with respect to a material fact; (3) which warranty was part of
the basis of the bargain; and (4) the express warranty was breached by defendant[.]”);
Kraft, 715 F.Supp.2d 473 (express warranty exists under New York law when a planitiff
shows “that the statement falls within the definition of a warranty, that she relied on it,
and that it became the basis for the bargain.”). An express warranty is interpreted like
a contract, and a Plaintiff can provide evidence of the warranty through various means.
Mill Printing & Lithography Corp. v. Solid Waste Management Systems, Inc., 65 A.D.
590, 590-91, 409 N.Y.S.2d 257, 258 (2d Dept. 1978). “[A]ffirmative representations”
can create express warranties. Symphony Fabrics Corp. v. Creations by Aria, Inc., 111
A.D.2d 650, 651, 490 N.Y.S.2d 212, 213 (1st Dept. 1985). An “express warranty is as
much a part of the contract as any other term. Once the express warranty is shown to
have been relied on as part of the contract, the right to be indemnified in damages for
its breach does not depend on proof that the buyer thereafter believed that the
assurances of fact made in the warranty would be fulfilled.” CBS, Inc. v. Ziff-Davis Pub.
Co., 75 N.Y.2d 496, 503, 553 N.E.2d 997, 1001 (1990). A party seeking
indemnification under the warranty need only “[establish] that the warranty was
breached.” Id. at 504.
The parties do not dispute the existence of a warranty agreement, or that the
14

warranty helped induce the bargain between the parties. The question here is whether
Defendant breached some portion of the warranty. Plaintiff’s brief attempts to address
this issue. Plaintiff describes the express warranty connected to the Kenworth vehicle
as the Kenworth Truck Company Limited Warranty Agreement, which promised that
“the ‘Kenworth vehicle,’ i.e., the trucks, would ‘be free from defects in materials and
factory workmenship [sic].’” In describing the breach, Plaintiff alleges that Fane began
to experience problems with both the engines and trucks as soon as the vehicles were
delivered. Because these problems existed and Kenworth never corrected them,
Plaintiff argues, the Defendant breached the express warranty that the trucks would be
free from defects in materials and workmanship and summary judgment must be
denied on this issue. Defendant insists that any problems were corrected, meaning that
no breach of warranty occurred. Because the warranty specifically disclaims any
incidental damages, Plaintiff cannot recover on any breach-of-warranty claim.
The warranty in question provides that “Kenworth warrants directly to you that
the Kenworth vehicle (“Vehicle”) identified below will be free from defects in materials
and factory workmanship (“Warrantable Failures”) appearing under normal commercial
use and service during the time or mileage limitations set forth in the attached Warranty
schedule[.]” (Exh. Y to Plaintiff’s Brief in Opposition (“Kenworth Warranty”) at 1). The
warranty also provides that “YOUR SOLE AND EXCLUSIVE REMEDY AGAINST
KENWORTH AND THE SELLING DEALER ARISING FROM YOUR PURCHASE AND
USE OF THIS VEHICLE IS LIMITED TO THE REPAIR AND REPLACEMENT OF
‘WARRANTABLE FAILURES’ AT AUTHORIZED UNITED STATES AND CANADIAN
KENWORTH DEALERS,” subject to the time and mileage limitations stated in the
15

warranty. Id. (capitalization in original). The warranty does not cover the entire vehicle,
stating that certain components “MAY” be covered by warranties by their
manufacturers, but “are NOT warrantied by Kenworth: engine and engine accessories,
Allison automatic transmission, fifth wheel, tires, wheels and rims, tubes, pintle hook,
hitch, batteries not listed in the Vehicle Schedule, trade accessories (such as fire
extinguishers, chains, emergency kits, and tools) and items not installed by the
Kenworth factory at the time of the vehicle’s manufacture.” Id. (capitalization in
original). The warranty also provides that “Kenworth is not responsible for damage or
loss resulting from engine horsepower upgrades.” Id. at 2. The warranty also contains
a section entitled “WARRANTY DISCLAIMER AND LIMITATIONS OF LIABILITY.” Id.
at 1 (bolding and capitalization in original). The warranty expressly disclaims “ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.” Id. (capitalization in original). That section also states, in relevant part:
IT IS AGREED THAT KENWORTH AND THE SELLING DEALER SHALL
NOT BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES
INCLUDING, BUT NOT LIMITED TO: LOSS OF INCOME OR LOST
PROFITS; VEHICLE DOWNTIME; THIRD PARTY DAMAGE, INCLUDING
DAMAGE OR LOSS TO OTHER VEHICLES OR PROPERTY,
ATTACHMENTS, TRAILERS AND CARGO; LOSS OR DAMAGE TO
PERSONAL CONTENTS; COMMUNICATION EXPENSES; LODGING
AND/OR MEAL EXPENSES; FINES; APPLICABLE TAXES OR BUSINESS
COSTS OR LOSSES; ATTORNEY’S FEES; AND ANY LIABILITY YOU MAY
HAVE IN RESPECT TO ANY OTHER PERSON OR ENTITY.
Id. (capitalization in original). The warranty goes on to provide time and mileage limits
for coverage on particular components, establishing that “[p]ursuant to the terms of the
attached Limited Warranty Agreement, Kenworth Truck Company will pay warranty
claims for Warrantable Failures[.]” (Id.).
16

This document, which Plaintiff claims is the source of its express warranty
claims against Defendant Kenworth, makes clear that Kenworth is obligated to pay for
repairing and replacing the parts of the vehicle covered by the warranty if those parts
prove defective. The warranty provides coverage for “warrantable failures,” which are
defined as “defects in materials and factory workmanship.” Plaintiff argues that the
failure of the truck to operate properly gives rise to a claim under this express warranty.
Plaintiff’s position, however, ignores the terms of the warranty and Plaintiff’s own
evidence presented in opposition to the motion for summary judgment.
The warranty upon which Plaintiff relies requires the Defendant to pay any
warranty claims for “defects in materials and factory workmanship.” Plaintiff’s evidence
points to several claims made for such failings. The evidence supplied by the Plaintiff,
however, also indicates that Plaintiff was not charged for parts or repairs made for
these defects. By the plain terms of the warranty, Defendant acted as the warranty
required. Defendant paid warranty claims. As such, Plaintiff cannot make out a claim
for breach of warranty on the basis of such defects, since a breach of express warranty
claim in New York requires a showing that Defendant actually breached its obligations
under the warranty. See Promuto, 44 F.Supp.2d at 642; see also, Craig v. American
Dist. Tel. Co., 91 Misc. 2d 1063, 1065, 399 N.Y.S.2d 164, 165 (Monroe Cty., 1977)
(granting judgment on express warranty claim because “[t]he complaint contains no
allegation of fact stating in what respect any warranty was breached nor does it contain
a statement of fact indicating that any breach was the proximate cause of the [plaintiff’s
injuries].”).
Plaintiff’s claim that the vehicles were unfit for the jobs for which they were
17

purchased could be construed as a claim for breach of an implied warranty of fitness for
a particular purpose. That claim is no more availing, since the warranty plainly
disclaims any implied warranties. Plaintiff’s brief does address Defendant’s argument
in this respect. In any case, the New York Uniform Commercial Code provides that “to
exclude or modify the implied warranty of merchantability or any part of it the language
must mention merchantability and in case of a writing must be conspicuous, and to
exclude or modify any implied warranty of fitness the exclusion must be in writing and
conspicuous.” NY CLS UCC §2-316(b). “Warranties of merchantability and fitness for
use are implied by” the UCC, therefore, “but may be excluded using the proper
language.” Basic Adhesives, Inc. v. Robert Matzkin Co., 101 Misc.2d 283, 288, 420
N.Y.S.2d 983, 986 (Bronx Cty. 1979). Thus, “the Uniform Commercial Code allows
parties, within limits established by the code, to modify or exclude warranties and to
limit remedies for breach of warranty.” Wilson Trading Corp. v. David Ferguson, Ltd.,
23 N.Y.2d 398, 402, 244 N.E.2d 685, 687 (1968); Maltz v. Union Carbide Chems. &
Plastics Co., 992 F.Supp. 286, 304 (S.D.N.Y 1997) (“It is well settled that under New
York law, parties to a contract may exclude or modify implied warranties so long as the
warranty disclaimer is conspicuous and specific.”). The disclaimer must use “‘language
which in common understanding calls the buyer’s attention to the exclusion of
warranties and makes plain that there is no implied warranty.’” Basic Adhesives, 101
Misc.2d at 288 (quoting NY CLS UCC 2-316, subd [3] par [a]).
Warranty disclaimers “in all capital letters and [specifying] the warranties that
are being disclaimed” have been found valid. Maltz, 992 F.Supp. at 304. By contrast, a
disclaimer that “does not alert or call the readers attention to the exclusion of any
18

warranty of fitness for a particular purpose” has been found invalid. Deven
Lithographers v. Eastman Kodak Co., 199 A.D.2d 9, 604 N.Y.S.2d 563,564 (1st Dept.
1993); Verdier v. Porsche Cars N. Am. Inc., 255 A.D.2d 436, 437, 680 N.Y.S.2d 596
(2d Dept. 1998) (summary judgment denied because “[q]uestions exist with respect to
whether the disclaimer upon which [defendant] relies was sufficiently conspicuous and
whether it was communicated to the plaintiff.”). The New York UCC defines
“conspicuous,” stating that “[a] term or clause is conspicuous when it is so written that a
reasonable person against whom it is to operate ought to have noticed it.” NY CLS
UCC § 1-201(10). “A printed heading in capitals . . . is conspicuous,” as is “[l]anguage
in the body of a form” that “is in larger or other contrasting type or color.” Id.
The disclaimer cited above meets the requirements for enforcement
described by the New York Courts. The disclaimer sets out clearly, in capital letters
and set apart in a section entitled “warranty disclaimer and limitations of liability,” that
Kenworth offers no warranty of merchantability or fitness for a particular purpose.
Kenworth Warranty, at 1. The disclaimer is conspicuous and obvious, and sets out in
all capital letters the specific warranties that are being disclaimed. A reasonable person
reading the warranty could not help but notice the disclaimer. Thus, to the extent that
Plaintiff’s claim is that the trucks were not suitable for the purpose for which they were
sold, Defendant has expressly disclaimed any warranty for those trucks. Summary
judgment is appropriate on that portion of the claim as well.
Moreover, the warranty also expressly disclaims most of the damages that
Plaintiff seeks to recover from the Defendant. The affidavit of Warren Fane, in
explaining the continued problems with the trucks, provides that “[w]hile the attempts by
19

Tri-State, Kenworth and Cummins came at no additional cost to Fane, Fane did incur
costs associated with the loss of use of the trucks while those repair attempts were
being made, incurred costs as a result of having [to] pay its own in-house mechanics to
repair the trucks’ fan hubs and exhaust pipes, incurred costs as a result of having direct
shipments and/or change trucks when engine failures occurred, and, ultimately,
incurred a loss when Fane sold the ten (10) trucks due to repeated failure of Tri-State,
Kenworth and Cummins to correct the issues and problems identified above.” (Warren
Fane Affidavit, un-lettered exhibit to Plaintiff’s Response in Opposition, dkt. # 43-29, at
¶ 28).
Defendant argues that the limitation in liability clause contained in the
warranty must be enforced. Plaintiff does not address this issue, but instead cites to
the general law of damages under the UCC to argue that Plaintiff can recover the
difference between the cost paid for the trucks and the cost for Plaintiff of purchasing
replacement vehicles. Plaintiff admits that it can claim no damages for repairs not
completed on the trucks or materials not replaced, but instead seeks damages for the
consequences of the malfunctioning engines, such as lost time for employees,
replacement vehicles, and the loss that Fane took when reselling the trucks. To the
extent that such damages are consequential damages, they are prohibited by the terms
of the warranty and Plaintiff cannot recover them. “A limitation on liability provision in a
contract represents the parties’ agreement on the allocation of the risk of economic loss
in the event that the contemplated transaction is not fully executed, which the courts
should honor.” Metropolitan Life Ins. Co. v. Noble Lowndes Int’l, 84 N.Y.2d 430, 436,
643 N.E.2d 504, 507 (1994). Courts enforce such provisions “absent a special
20

relationship between the parties, a statutory prohibition, or an overriding public policy.”
Smith-Hoy v. AMC Prop. Evaluations, Inc., 52 A.D.3d 809, 810, 862 N.Y.S.2d 513, 516
(2d Dept. 2008). A party can also avoid such limitations by demonstrating that “the
party seeking to avoid liability has engaged in grossly negligent conduct evincing a
‘reckless disregard for the rights of others.’” Pacenet Network Ltd. v. KDDI Corp., 912
N.Y.S. 2d 178, 180 (1st Dept. 2010) (quoting Colnaghi, U.S.A. v. Jewlers Protection
Servs., 81 NY2d 821, 823-24, 611 N.E.2d 282 (1993)).
The warranty expressly disclaims a right to consequential damages. Plaintiff
has not pointed to any evidence or made any argument to demonstrate either special
conditions preventing the enforcement of the limitation on liability or conduct in reckless
disregard for others’ rights on the part of the Defendant. To the extent that the
damages Plaintiff seeks are consequential damages, Plaintiff could not recover even if
there were evidence to support the breach-of-warranty claims.
Plaintiff argues, however, that Fane could recover for the cost of purchasing
replacement vehicles.3 Unfortunately for the Plaintiff, no breach of warranty has been

3

Plaintiff eventually sold the 10 trucks at a loss and replaced them with other
vehicles which better fit the Plaintiff’s needs. Plaintiff contends that New York’s version
of the Uniform Commercial Code permits recovery for such damages, since the Code
provides that “[t]he measure of damages for breach of warranty is the difference at the
time and place of acceptance between the value of the goods accepted and the value
they would have had if they had been as warranted, unless special circumstances show
proximate damages of a different amount.” NY UCC § 2-714(2). The Second Circuit
Court of Appeals, applying New York law, has found the recovery permitted under this
provision to be distinct from consequential damages, holding that “[t]here is a difference
between the loss of the inherent economic value of the contractual performance as
warranted . . . and the loss of profits that the buyer anticipated garnering from
transactions that were to follow the contractual performance.” T.Co Metals, LLC v.
Dempsey Pipe & Supply, Inc., 592 F.3d 329, 340 (2d Cir. 2010). Because diminished
value is distinct from damages flowing from the breach, “a buyer may recover the
21

shown, and the only breach of warranty that would likely cover the diminished value of
the tractors would be the breach of an implied warranty of fitness for a particular
purpose. Since Plaintiff does not address Defendant’s argument that any implied
warranties were validly disclaimed in the written warranty, there was no breach of
warranty that could give rise to a claim of diminished value. The Court finds that
Plaintiff could not recover any damages with respect to diminished value, and that
summary judgment must be granted with respect to this portion of the claim as well.
ii. Breach of Contract
Defendant next argues that Plaintiff’s breach-of-contract claims must be
dismissed. Defendant contends that almost all of Plaintiff’s claims relate to engine
issues. The engine was not produced by Kenworth, and thus no claims can exist for
those claims. Any problems with the vehicles that may have been subject to
Kenworth’s warranty or any promises made by Kenworth were resolved pursuant to the
warranties. Moreover, Kenworth built the vehicles to Plaintiff’s specifications. Plaintiff
therefore has no claim for breach of contract against Kenworth. Again, Plaintiff offers
no response to this portion of the motion. Plaintiff apparently agrees with the
Defendant that no claim for breach of contract can be maintained based on the facts in
the record. The Court agrees, as the evidence indicates that the Defendant delivered
the trucks as specified in the purchase order, the contract here at issue. The Court will

diminution in the value of the contractual goods as warranted even where there is a
contractual exclusion of consequential damages.” Id. Thus, Plaintiff could conceivably
recover the diminished value of the trucks that was the result of the Defendant’s breach
of warranty.
22

grant the motion for summary judgment in this respect as well.4
iii. Damages
Finally, Defendant argues that the warranty in question contained an express
provision disclaiming any potential liability for incidental or coincidental or coincidental
damages. The Court has already explained that Plaintiff cannot prove Defendant liable
on any claims. As such, the question of damages is moot.
C.

Defendant Tri-State’s Motion

Defendant Tri-State Diesel, Inc. (“Tri-State”), also seeks summary judgment
on several grounds, which the Court will address in turn, as appropriate. See dkt. #34.
i. Warranty Claims Based on the Written Kenworth Warranty
Tri-State first argues that Plaintiff cannot prevail on any warranty claims,
whether express or implied. Tri-State contends that the only warranty that can apply in
this case is the express warranty provided by Kenworth and discussed above.
Defendant points out that the Kenworth Warranty represents that the warranty applies
to both Kenworth and the “Selling Dealer,” Tri-State. Tri-State offered no distinct
warranty separate from the Kenworth warranty. Since Plaintiff has not pointed to any

4

Plaintiff’s claim here is for breach of contract. In New York, “an action for
breach of contract requires proof of (1) a contract; (2) performance of the contract by
one party; (3) breach of contract by the other party; and (4) damages.” Rexnord
Holdings v. Bidermann, 21 F.3d 522, 525 (2d Cir. 1994). In general, “when parties set
down their agreement in a clear, complete document, their writing should as a rule be
enforced according to tits terms. Evidence outside the four corners of the document as
to what was really intended but unstated or misstated is generally inadmissible to add to
or vary the writing.” W.W.W. Assocs. v. Giancontieri, 77 N.Y.2d 157, 162, 566 N.E.2d
639, 642 (1990). “Whether or not a writing is ambiguous is a question of law to be
resolved by the courts.” Id.
23

provision of the warranty agreement between the parties which Defendant Tri-State
breached, Tri-State argues, no warranty claim can be made. Any breach of warranty on
the engine is an argument between Cummins and Plaintiff, and does not involve TriState. Tri-State also contends that no breach of the Kenworth warranty occurred.
Plaintiff responds by claiming that Defendant breached the Kenworth warranty by
providing trucks that were not free from defects, and never fully corrected those
defects.
Plaintiff’s arguments here are essentially the same arguments Plaintiff makes
in connection with Kenworth’s motion for summary judgment on the express warranty
claim. Plaintiff’s arguments here fail for the same reasons: the Defendant did not
breach the warranty but instead acted as obligated under the warranty’s terms.
Summary judgment will be granted to Defendant Tri-State on the same basis as for
Kenworth, supra.
ii. Warranty Allegedly Created During Purchase of the Vehicles
Defendant Tri-State also contends that the negotiations surrounding the
purchase of the trucks did not create any sort of express warranty. Any statements
made by Tri-State representatives were merely generalized ones and did not create any
sort of express warranty. No promises were made about the suitability of the vehicles
for Plaintiff’s purposes, the performance of the engines, or the fuel economy those
engines delivered. Instead, Tri-State’s representative offered a simple commendation
of the Cummins engine. Any other statements were merely puffery and cannot be seen
as warranties. Tri-State likewise argues that none of the comments made in

24

negotiations for the purchase of the truck could be considered warranties concerning
gas mileage. Plaintiff disagrees, contending that Tri-State’s representative, Tom
Jennings, made express representations concerning the performance and fuel milage
that could be obtained using the Kenworth machines. Plaintiff relied on these
representations and purchased the trucks. Only after purchase did Plaintiff discover
that the vehicles did not provide the promised performance.
The question in this instance is whether the parties created an express
warranty during the negotiations that led to the purchase of the vehicles. As explained
above, “a cause of action on an express warranty asks only that a manufacturer make
good on the contractual commitment that it voluntarily undertook by placing that
warranty on its product.” Bates, 544, U.S. at 444. In New York, a “seller can create an
express warranty by affirmation, promise, description or sample.” Kraft, 715 F.Supp.2d
at 472 (S.D.N.Y. 2010). To prevail on an express warranty claim, a Plaintiff must “show
that there was an ‘affirmation of fact or promise by the seller, the natural tendency of
which [was] to induce the buyer to purchase’ and that the warranty was relied upon[.]”
Schimmenti, 156 A.D.2d at 659 (quoting Friedman, 42 A.D.2d at 190); see also
Promuto, 44 F.Supp.2d at 642 (In New York a breach of warranty claim requires a
“showing that: (1) plaintiff and defendant entered into a contract; (2) containing an
express warranty by the defendant with respect to a material fact; (3) which warranty
was part of the basis of the bargain; and (4) the express warranty was breached by
defendant[.]”); Kraft, 715 F.Supp.2d 473 (express warranty exists under New York law
when a plaintiff shows “that the statement falls within the definition of a warranty, that
she relied on it, and that it became the basis for the bargain.”).
25

An express warranty is interpreted as a contract, and a Plaintiff can provide
evidence of the warranty through various means. Mill Printing & Lithography Corp., 65
A.D. at 590-91. “[A]ffirmative representations” can create express warranties.
Symphony Fabrics Corp., 111 A.D.2d at 651. An “express warranty is as much a part
of the contract as any other term. Once the express warranty is shown to have been
relied on as part of the contract, the right to be indemnified in damages for its breach
does not depend on proof that the buyer thereafter believed that the assurances of fact
made in the warranty would be fulfilled.” CBS, Inc., 75 N.Y.2d at 503. A party seeking
indemnification under the warranty need only “[establish] that the warranty was
breached.” Id. at 504.
Although there is evidence from which it could be concluded that an express
warranty by Tri-State existed5, the Court must find, however, that no such claim can be

5

The evidence in this case indicates that Plaintiff began looking to purchase ten
new trucks in September 2010. (Defendant Tri-State’s Statement of Material Facts
(“Tri-State Statement”), dkt. # 34-1 at ¶ 2). Greg Fane, son of the Plaintiff’s founder
and president Warren Fane, was directly involved in attempting to purchase the
vehicles in question. (Id. at ¶¶ 4-7). In negotiating the purchase of the ten additional
trucks, Plaintiff had specific expectations as to power, transmissions, gear ratios, and
weight. (Id. at ¶ 8; Plaintiff’s Response to Tri-State Statement of Material Facts
(“Plaintiff’s Response to Tri-State”), dkt. # 44-1, at ¶ 8). Plaintiff sought trucks similar in
performance to those already in Plaintiff’s fleet. (Id., at ¶¶ 8-9).
Eventually, Greg Fane, with assistance from Warren Fane, negotiated the
purchase of the ten trucks from Defendant Tri-State. (Tri-State Statement at ¶ 16;
Plaintiff’s Response to Tri-State at ¶ 16). Edward Thomas (“Tom”) Jennings negotiated
this sale with the Plaintiff. (Id.). Jennings had been employed by Tri-State since 1996.
(Tri-State Statement at ¶ 17). Greg Fane called Tri-State and spoke with Tom
Jennings. (Id. at ¶ 22). Jennings had initially contacted Plaintiff in July 2010. (Id. at ¶
23). The parties negotiated the deal over the telephone and by fax. (Id. at ¶ 24). Fane
sought specific features on the trucks: a 240 inch wheel base, 485 horsepower engine,
391 gear ratio, 13-speed transmission, 13,200 pound front axle and 46,000 pound rear
axle. (Id. at ¶ 25). According to the Defendant, Jennings helped Fane “fine tune” these
specifications. (Id. at ¶ 26). Plaintiff contends that, after hearing of Fane’s needs,
26

established. The Kenworth Warranty provides that “This limited warranty is the sole
warranty made by Kenworth and the Selling Dealer. Except for the above
warranty, Kenworth and the Selling Dealer make no other warranties, express or
implied.” (Kenworth Warranty, at 1) (bolding in original). The Warranty is signed by a
representative of the Kenworth Truck Company, Warren Fane and a representative of
Jennings “recommended that Plaintiff purchase the trucks at issue.” (Plaintiff’s
Response to Tr-State, at ¶ 26). After being informed of Plaintiff’s intended uses,
Jennings suggested that Plaintiff purchase 500 horsepower engines. (Id. at ¶ 28).
Greg Fane testified that after informing Jennings of Plaintiff’s needs for the
trucks, he had a second conversation with Jennings by telephone. (See Greg Fane
Deposition (“Fane Dep.”), exh. C to Plaintiff’s Response to Defendant’s Motion, dkt. #
44-5, at 42). After receiving Fane’s specifications, Jennings had “talked to his
engineer–engineers or the people at Cummins . . . and they had recommended this
bigger–this 500.” (Id.). “It was more suitable for our application.” (Id. at 42-43). Fane
responded that “‘[y]ou know what I’m looking for . . . If that’s what it takes to do what I
need it to do, you know, we’ll do the 500.’” Id. at 43. Jennings had convinced Fane that
he needed a bigger engine to meet his needs. Id. at 44. Fane at first had requested a
485-horsepower Cummins engine because he believed that engine would deliver 17001800 foot-pounds of torque. (Id. at 45-46). Jennings, however, told him that he
needed a 500-horsepower engine to achieve that much torque. (Id. at 46). Fane also
testified that Jennings informed him that his fuel mileage would improve with such
engines. (Id.). Jennings told him that the larger engines would “help fuel economy.”
(Id. at 47). Fane soon contacted Jennings to inform him that they had a deal. (Id. at
55).
Defendant argues that no evidence exists to support Plaintiff’s claim that TriState offered an express warranty as to the performance and fuel mileage that the
trucks would provide. The Court finds, however, that there is evidence in the record
which, if believed by a jury, could lead to a finding that there was an “‘affirmation of fact
or promise by the seller, the natural tendency of which [was] to induce the buyer to
purchase’ and that the warranty was relied upon[.]” Schimmenti, 156 A.D.2d at 659.
The evidence related above indicates that Jennings, when given the information on the
performance that Plaintiff sought from a vehicle, informed Fane that a larger engine
was necessary. He told Fane that a 500-horsepower engine would meet the Plaintiff’s
performance requirements. He also informed Fane that such an engine would deliver
improved gas mileage. Based on this information, Plaintiff purchased the vehicles. The
vehicles, once delivered, were deficient in power, gas mileage, reliability, and other
aspects of performance that were part of Jenning’s promises to Fane. This evidence
could be used by a jury to find the existence of an express warranty by Tri-State, and
also to find that the vehicle delivered did not meet that warranty.
27

the authorized dealer. (Id. at 2). The name of the Dealer is listed as Tri-State
Kenworth, the moving Defendant here. Thus, the Defendant disclaimed all warranties
not contained in the written document. For the reasons stated above with respect to
other disclaimers, this court finds the disclaimer of other warranties valid with respect to
any express warranties. The warranty clearly applies to Tri-State, as well as to
Kenworth, and clearly excludes any prior oral representations like the ones at issue
here. Courts in New York have enforced such exclusions when the language of the
exclusion, as here, indicates that the written warranty represents the sole agreement
between the parties and excludes all other representations. See, e.g., Pennsylvania
Gas Co. v. Secord Bros., Inc., 73 Misc. 1031, 1038, 343 N.Y.2d 256, 263-64
(Chautauqua Cty., 1973) (rejecting an express warranty claim based on oral
representations about the product based on a clause in the written warranty “indicat[ing]
that the parties intended that there would be no survival or application of warranties
either express or implied.”).
Because the parties agreed that no warranty except those in the written
warranty could apply to this case, the Court must grant summary judgment to Plaintiff
on the express warranty claims arising from the sales negotiations in this matter.
iii. Implied Warranties
Defendant next argues that the disclaimer in the Kenworth warranty
preventing any implied warranty claims applies to Tri-State as well. Plaintiff does not
respond to this argument, which is based on the same legal grounds as Kenworth’s
argument on implied warranties. The motion will be granted for the same reason as
Kenworth’s motion was granted: the Kenworth warranty clearly and unequivocally
28

disclaims any implied warranties and such a disclaimer is enforceable in this context.
iv. Limitation on Damages
Finally, Tri-State contends that the limitation on damages contained in the
Kenworth warranty apply to this case and establish that Plaintiff cannot obtain any
consequential damages on its warranty claims. Plaintiff responds that Tri-State can be
liable for the damages associated with the cost of replacing the deficient trucks and
engines sold by Tri-State. As the Court has found that Plaintiff cannot prevail on any of
its claims against Tri-State, this portion of the motion is moot, and the Court will not
address it.
D.

Defendant Cummins Northeast’s Motion

Defendant Cummins Northeast, LLC, has also filed a motion for summary
judgment, alleging that Cummins cannot be liable because Defendant played no role in
the manufacture or sale of the engines about which Plaintiff complains. See Dkt. 35.
Defendant contends that Plaintiff cannot prevail on either claim raised against
Cummins: breach of express warranty or breach of implied warranty. Defendant argues
that Plaintiff cannot establish the existence of an express warranty by Cummins
Northeast and cannot demonstrate the privity of contract required to establish an
implied warranty.
i. Expresss Warranty
Defendant Cummins argues that Plaintiff cannot establish an express
warranty claim because Plaintiff cannot establish the existence of any such warranty
provided by the Defendant. Cummins argues its business was not the sale or

29

manufacture of the engines, and that Cummins did not make any warranty to Plaintiff
upon the purchase of the engines. Instead, Cummins Northeast simply provided
warranty repairs as an agent of Cummins, Inc., which had actually manufactured the
engines and provided the warranty. Plaintiff responds that Cummins breached an
express warranty by “failing to adequately and appropriate [sic] diagnosis [sic],
remediate and/or repair the litany of engine-related problems that Plaintiff experienced
with the” Cummins engine. Plaintiff argues that the engines were purchased with a
warranty from Cummins that covered parts and labor, that Cummins undertook to repair
the engines under the warranty, and that these repairs did not solve the problems with
the engines. Since Cummins had represented that its repairs would solve the engine
failures and deficiencies and Plaintiff relied upon those representations, Cummins
breached an express warranty.
Plaintiff apparently does not dispute that the warranty supplied with the
Cummins engines was not a warranty that Defendant Cummins Northeast issued.
Instead, Plaintiff simply contends that the repairs made by Defendant Cummins
Northeast were inadequate and failed to cure the defects in the engine as promised. In
other words, Plaintiff alleges that Defendant breached an express warranty created
when Plaintiff brought the trucks in for repair to Defendant Cummins Northeast.
Without citing to any evidence of statements by agents or representatives of Defendant
Cummins, or any written guarantees at the time the repairs to the engines were
performed, Plaintiff now argues that the express warranty claim is based on the failure
of the repairs to make the trucks work as Plaintiff desired. Defendant responds that this
claim amounts to a change in the theory of liability after discovery has closed, and one
30

not supported by any evidence in the record.
Plaintiff does not point to any place in the record where evidence exists to
support its claim that “Cummins expressly represented that it was capable of fixing the
many engine failures and deficiencies suffered by Plaintiff.” Dkt. #42 at 9. Plaintiff
simply asserts that such a promise existed without citing to who made that promise,
where, or when. Indeed, in responding to Defendant Cummins’ statement of material
facts, Plaintiff admitted that all repairs were performed pursuant to the Cummins, Inc.,
warranty, and were performed by Defendant Cummins Northeast at no cost to the
Plaintiff. (See Defendant Cummins Statement at ¶¶ 19-20). To the extent that Plaintiff
seeks to raise a warranty claim based on the repairs performed, Plaintiff could not
prevail against Cummins Northeast–assuming that Cummins Northeast had actually
issued the warranty–for the same reasons that Plaintiff cannot prevail against Kenworth
on an express warranty claim. Cummins fixed the parts at no cost, and continued to
attempt to do so under the terms of the warranty. As with the claims against Kenworth,
Plaintiff’s claim here is really an implied warranty claim based on an implied warranty of
merchantability or implied warranty of fitness for a particular purpose. As explained
below, Plaintiff could not prevail on either claim.
Plaintiff therefore points to no record evidence to support its claim that
Defendant Cummins, which was performing repairs pursuant to a warranty issued by
Cummins, Inc., not a defendant, had somehow warrantied that those repairs would
completely solve any problems caused by the trucks. In the context of the instant
motion, the burden is on the Plaintiff to point to evidence which, if believed, would
cause a jury to find for the non-moving party. Defendant has produced evidence to
31

establish that it made no express warranty related to the engines, and, as explained
previously, Plaintiff must produce evidence establishing the existence of a factual
dispute that a reasonable jury could resolve in his favor. Matsushita Elec. Indus. Co.,
475 U.S. at 587. A party opposing a properly supported motion for summary judgment
may not rest upon "mere allegations or denials" asserted in his pleadings, Rexnord
Holdings, Inc. v. Bidermann, 21 F.3d 522, 525-26 (2d Cir. 1994), or on conclusory
allegations or unsubstantiated speculation. Scotto v. Almenas, 143 F.3d 105, 114 (2d
Cir. 1998). Plaintiff does not even point to the pleadings, much less any evidence in the
record, but simply asserts in its brief that evidence exists. Plaintiff therefore simply
relies on “‘conclusory allegations’” and “‘unsubstantiated speculation’” without citation to
the record. Northeast Research, LLC v. One Shipwrecked Vessel, 729 F.3d 197, 214
(2d Cir. 2013) (citing Scotto, 143 F.3d at 114). Such assertions cannot defeat a
property-supported motion for summary judgment. Id. Plaintiff has failed to meet its
burden, and the Court will grant the motion on these grounds.
ii. Implied Warranty
Defendant next argues that Plaintiff cannot prevail on its breach-of-implied
warranty claims against Cummins. Such claims require privity of contract between
Cummins and Plaintiff at the time the engine was purchased, and no such privity
existed. While Plaintiff urges the Court to deny the Defendant’s motion in its entirety,
the Plaintiff offers no actual argument in response to Defendant’s position that no
implied warranty was ever offered, and does not deny that Cummins never had any
contact with the Plaintiff’s representatives before the engines were purchased.
New York law is clear that where there is “no privity between the purchaser
32

and the defendant there can be no implied warranty.” Arthur Jaffee Assocs. v. Bilsco
Auto Serv., 58 N.Y.2d 993, 995, 448 N.E. 2d 792 (1983); see also, Kolle v. Mainship
Corp., No. 04cv711, 2006 U.S. Dist. LEXIS 28956, *13 (S.D.N.Y., Apr. 20, 2006) (“New
York law requires privity in order for Plaintiff to assert a breach of an implied warranty.”).
The Second Circuit Court of Appeals has emphasized that this privity requirement
applies to an “implied warranty of fitness for a particular purpose,” because such a
warranty arises “only when a seller knows or has reason to know the particular purpose
for which a buyer requires goods, and also knows or should know that the buyer is
relying on his special knowledge.” Abraham v. Volkswagen of America, Inc., 795 F.2d
238, 249 (2d Cir. 1986). Privity is required “because the creation of the warranty
requires a direct exchange between buyer and seller.” Id. Thus, “no implied warranty
will extend from a manufacturer to a remote purchaser not in privity with the
manufacturer where only economic loss and not personal injury is alleged.” Lexow &
Jenkins v. Hertz Commercial Leasing Corp., 504 N.Y.S.2d 192, 193-94, 122 A.D.2d 25,
26 (2d Dept. 1986).
Courts in New York have noted that “privity of contract” has been “traditionally
defined by Black’s Law Dictionary as ‘that connection or relationship which exists
between two or more contracting parties[.]” Piper Acceptance Corp. v. Barton, No. 83
Civ. 4998, 1987 U.S. Dist. LEXIS 175, at *4 (S.D.N.Y. Jan. 14, 1987); see also, Impulse
Mtkg. Group, Inc. v. Nat’l Small Bus. Alliance, No. 05cv7776, 2007 U.S. Dist. LEXIS
42725 (S.D.N.Y., Jun. 12, 2007) (“Several courts, relying on Black’s Law Dictionary,
have defined ‘privity of contract’ to mean ‘[t]he relationship between the parties to a
contract, allowing them to sue each other but preventing a third party from doing so.’”)
33

(quoting BLACK’S LAW DICTIONARY 1237-38 (8th Ed. 2004)); Diarama Trading Co. v. J.
Walter Thompson USA, Inc., No 01 Civ. 2950, 2005 U.S. Dist LEXIS 19496, at *33
(S.D.N.Y. Sept. 6, 2005) (“The Black’s Law Dictionary definition of privity makes no
mention of a written contract, defining the term as ‘the connection or relationship
between two parties, each having a legally recognized interest in the same subject
matter (such as a transaction, proceeding, or piece of property); mutuality of interest.”)
(quoting BLACK’S LAW DICTIONARY at 1237 (8th Ed. 2004)).
Plaintiff admits facts that undermine any claim to privity of contract, and thus
any implied warranty. Defendant states, for instance, that “Cummins Northeast did not
manufacture or warrant the engines in the trucks purchased by Fane, or sell them to
anyone in the chain of distribution of those engines and trucks, including Kenworth or
Tri-State.” (Cummins Statement at ¶ 10). Plaintiff admits this statement, and only adds
that Cummins Northeast worked to repair the engines. (Plaintiff’s Response to
Cummins Statement at ¶ 10). Plaintiff also admits, with the same caveat, that “the
Cummins engines were manufactured and warranted by Cummins Inc. and sold to
Kenworth, who built the trucks that Tri-State sold to Fane.” (Cummins Statement at ¶
11; Plaintiff’s Response to Cummins Statement at ¶ 11). Moreover, “Cummins
Northwest was not involved in the selection of the Cummins engines for Fane’s trucks.”
(Cummins Statement at ¶ 12). Indeed, Plaintiff admits that “Cummins Northwest was
not aware of Fane’s purchase of the 10 Kenworth trucks containing Cummins engines
until sometime after Fane took delivery of the trucks in the fall of 2010.” (Id. at ¶ 13).
Thus, Plaintiff admits that no contractual relationship was formed by the
parties and no privity of contract existed at the time that an implied warranty would have
34

been created. Plaintiff admits that no relationship existed between Defendant Cummins
and Fane outside of Defendant’s express warranty-related repairs on the Cummins
Engines. Plaintiff does not even attempt to argue that these repairs created an implied
warranty that Defendant has breached, and could not. Defendant Cummins did not
provide an implied warranty, and summary judgment will be granted Defendant on this
claim.
Even if the Court could conclude that an implied warranty existed, the
Cummins Warranty issued when the trucks were purchased disclaims any implied
warranties. The disclaimer is prominently displayed in a section of the warranty entitled
“limitations,” and is stated in all capital letters and bold type. (See Exh. A. to Affidavit of
Dan Davis, dkt. #35-11). The disclaimer states:
THIS WARRANTY AND THE EMISSION WARRANTY SET FORTH
HEREWITH ARE THE SOLE WARRANTIES MADE BY CUMMINS IN
REGARD TO THESE ENGINES. CUMMINS MAKES NO OTHER
WARRANTIES, EXPRESS OR IMPLIED, OR OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE
(Id.) (capitalization and bolding in original). The manufacturer of the engine thus clearly
disclaimed any implied warranties. For the same reasons that the disclaimer in the
Kenworth warranty prevents Plaintiff from making any claim of an implied warranty, this
disclaimer prevents Plaintiff from succeeding on its implied warranty claims against
Cummins. The Court will therefore grant the motion with respect to Plaintiff’s implied
warranty claims.
III.

CONCLUSION
For the reasons stated above, the Court will grant each of the moving

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Defendants’ motions for summary judgment, dkts. 33-35.
IT IS SO ORDERED.
Dated:May 7, 2014

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