LIBERTY INSURANCE UNDERWRITERS, INC., V. BEAUFURN, LLC, ET AL.
Filing
76
MEMORANDUM OPINION AND ORDER signed by JUDGE WILLIAM L. OSTEEN, JR on 09/23/2019, that Plaintiff's Motion for Partial Summary Judgment, (Doc. 65 ), is GRANTED IN PART AND DENIED IN PART, in that the motion is GRANTED as to all sales conducted pursuant to purchase orders dated prior to or on January 15, 2007, and DENIED as to all sales conducted pursuant to purchase orders dated after January 15, 2007. FURTHER ORDERED that Defendant Beaufurn, LLC's Motion for Summary Judgment, (Doc. 63 ), is GRANTED IN PART AND DENIED IN PART, in that the motion is DENIED as to all sales conducted pursuant to purchase orders dated prior to or on January 15, 2007, GRANTED as to all sales conducted pursuant to purchase orders dated after January 15, 2007, and DENIED as to Plaintiff's Third Cause of Action. FURTHER ORDERED that the Seventh, Eighth and Ninth Causes of Action are hereby DISMISSED. A partial judgment reflecting this memorandum opinion andorder will be entered contemporaneously herewith.(Taylor, Abby)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
LIBERTY INSURANCE UNDERWRITERS, )
INC., an Illinois corporation,
)
)
Plaintiff,
)
)
v.
)
)
BEAUFURN, LLC, a North Carolina )
limited liability company;
)
and DOES 1–10,
)
)
)
Defendants.
)
1:16CV1377
MEMORANDUM OPINION AND ORDER
OSTEEN, JR., District Judge
Currently before the court are two motions for summary
judgment. (Docs. 63, 65.) Plaintiff Liberty Insurance
Underwriters, Inc., has moved for partial summary judgment on
the issue of whether certain insurance and indemnification
provisions are included in the underlying contracts between The
Cheesecake Factory, Inc. (“TCF”) and Defendant Beaufurn, LLC
(“Beaufurn”). Plaintiff argues that TCF’s terms were accepted
and should govern each contract. Defendant Beaufurn has also
moved for summary judgment and argues that all claims against it
should be dismissed. Beaufurn contends that its order
acknowledgments expressly rejected TCF’s terms, which thus did
not become part of the relevant contracts. For the reasons set
forth herein, this court finds that each motion should be
granted in part and denied in part.
I.
FACTUAL & PROCEDURAL BACKGROUND
On June 14, 2013, Janet Kinzler was injured when she fell
from a high top chair while seated at a high top table with some
colleagues at a TCF restaurant in Maryland. (First Am. Compl.
(“Am. Compl.”) (Doc. 52) ¶ 11.) TCF regularly purchases barstools
from Beaufurn for use in its “restaurants across the country,
including in its location at 7002 Arundel Mills Circle, Hanover,
Maryland.” (Denise Hall Declaration (Doc. 63-1) ¶ 4.) The chair
from which Kinzler fell was “designed, manufactured and/or
distributed by Beaufurn.” (Am. Compl. (Doc. 52) ¶ 11.) TCF
investigated the incident, concluded that Kinzler’s injuries were
most likely caused by her own actions, and returned the subject
chair to service in its restaurant. (William Ivar Bongaerts
Deposition (Doc. 63-5) at 24; Cook Dep. (Doc. 63-4) at 2.)
On March 18, 2014, Kinzler sued TCF in federal court in the
Western District of Pennsylvania, alleging that TCF was
negligent by “utilizing chairs that were unstable and subject to
overturning” and by maintaining and failing to warn customers of
slippery floors in its restaurant. (Kinzler v. The Cheesecake
Factory, Inc. Am. Compl. (Doc. 52-2) ¶ 35.) Plaintiff alleged
damages in an amount greater than $75,000.00. (See Am. Compl.
-2-
(Doc. 52-2).) TCF requested that Beaufurn defend TCF against
Kinzler’s claim and indemnify TCF for any resulting damages,
pursuant to the terms of the purchase order for the subject
chair. (Am. Compl. (Doc. 52) ¶ 19–20; TCF Demand Letter to
Beaufurn (Doc. 52-3).) Beaufurn apparently passed this demand
along to The Cincinnati Insurance Company (“CIC”), its primary
and umbrella insurer.
(Am. Compl. (Doc. 52) ¶¶ 21–22.) Neither
CIC nor Beaufurn agreed to defend or indemnify TCF in the
Kinzler lawsuit. (Id. ¶¶ 21–24.)
TCF, Plaintiff (TCF’s primary insurer), and ACE American
Insurance Company (TCF’s excess insurer), subsequently settled
the Kinzler action for the total “sum of $4,375,000, of which
LIU [Liberty Insurance Underwriters] paid the sum of
$3,558,284.39, TCF paid $316,715.61 and ACE American paid
$500,000.” (Id. ¶ 29.) Plaintiff now seeks to recover from
Beaufurn the following amounts: (1) $61,554.56 in defense costs
paid directly by Plaintiff, (2) $183,284.39 in defense costs
paid by TCF, which Plaintiff alleges “eroded TCF’s self-insured
retention under the ACE” policy, causing this policy to be
depleted faster and causing spillover into Plaintiff’s policy,
and (3) $3,558,284.39, the Kinzler settlement amount paid
directly by Plaintiff. (Id. ¶¶ 31, 45.)
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Plaintiff originally brought suit in California state
court. Defendants then removed the case to federal court in the
Central District of California. (See generally Notice of Removal
(Doc. 1).) Defendants moved to transfer the case to this
district; that motion was granted by Judge Fernando M. Olguin
November 30, 2016. (See Venue Order (Doc. 34).)
Beaufurn has moved for summary judgment. (See Doc. 63.)
Beaufurn argues that the purchase orders and order
acknowledgments contained conflicting insurance and
indemnification provisions and that each expressly limited
acceptance to its own terms.1 Therefore, under Uniform Commercial
Code {“UCC”) 2-207, the insurance and indemnification terms in
the purchase orders “were not part of the contract, so Beaufurn
could not have breached those terms.” (Def.’s Mem. of Law in
Supp. of Mot. for Summ. J. (“Def.’s Mem.”) (Doc. 64) at 13–14.)
The “Terms and Conditions of Sale” attached to TCF’s
purchase orders required the “Seller,” or Beaufurn, to carry
commercial general liability insurance of a specified amount and
type and to indemnify the “Buyer,” or TCF, for damage “arising
out of, or in connection with the use of any Product provided by
Seller.” (TCF Purchase Order No. 5616 (“TCF Purchase Order
5616”) (Doc. 52-8) at 3.) Beaufurn’s “Terms & Conditions of
Sale,” which were attached to the signature sheet for at least
some transactions, provided that the “Seller,” or Beaufurn, was
obligated only to carry the minimum amount of insurance coverage
required by law and that the “Purchaser,” or TCF, agreed to
indemnify Beaufurn for damage “arising out of the death or
injury to person or damage to property resulting from the sale,
marketing or use of the Products by Purchaser.” (Beaufurn Pro
Forma Invoices (“Beaufurn Pro Forma”) (Doc. 65-11) at 14.)
1
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Plaintiff has moved for partial summary judgment. (See Pl.’s
Mot. for Partial Summ. J. (Doc. 65).) Plaintiff argues that the
purchase orders were offers to purchase the subject chairs, that
Beaufurn’s order acknowledgments were valid acceptances not
expressly conditioned on Plaintiff’s acceptance of any
additional terms, and that therefore the insurance and
indemnification provisions in the purchase orders govern the
relevant contracts. (See Pl.’s Mem. of Law in Supp. of Mot. for
Partial Summ. J. (“Pl.’s Mem.”) (Doc. 66) at 15–20.) Plaintiff
requests summary judgment on the issue of whether “the terms and
conditions of TCF’s purchase orders controlled the contract for
the sale of goods” and an order “precluding Beaufurn from
invoking its terms and conditions as a defense to Plaintiff’s
claims.” (Pl.’s Mot. for Partial Summ. J. (Doc. 65) at 2.)
II.
GOVERNING LAW
The parties agree that choice of law is immaterial to this
case because both North Carolina and California have adopted the
relevant UCC provision without change. (Compare Def.’s Mem.
(Doc. 64) at 10, with Pl.’s Mem. (Doc. 66) at 13.) Though the
ultimate result may be the same regardless of the law chosen, a
proper choice-of-law analysis is still required.
A federal district court sitting in diversity applies the
choice-of-law rules of the forum. See Klaxon Co. v. Stentor
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Elec. Mfg. Co., 313 U.S. 487, 496–97 (1941). When either party
is granted transfer under 28 U.S.C. § 1404(a),2 however, the
transferee court applies the choice-of-law rules of the
transferor court. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 243
n.8 (1981); see also Ferens v. John Deere Co., 494 U.S. 516, 519
(1990) (superseded by statute on other grounds); Volvo Constr.
Equip. N. Am., Inc. v. CLM Equip. Co., 386 F.3d 581, 600 (4th
Cir. 2004). The rule in Piper and Ferens for Section 1404(a) and
choice-of-law is inapplicable in cases governed by valid forum
selection clauses. See Atl. Marine Constr. Co. v. U.S. Dist. Ct.
for W. Dist. of Tex., 571 U.S. 49, 65—66 (2013). As will be
discussed infra, TCF and Beaufurn had conflicting forum
selection clauses that were “knocked out” under California’s
“battle of the forms provision.” (See Venue Order (Doc. 34) at
6-7.) Therefore, in this case, there was no valid forum
Transfer under Section 1404(a) is appropriate when venue
was first properly laid in the transferor district. Compare 28
U.S.C. § 1404(a), with § 1406(a); see also Van Dusen v. Barrack,
376 U.S. 612, 634 n.30 (1964). Though the district court in
California did not expressly state that venue was proper in the
Central District of California, (see generally Venue Order (Doc.
34)), that court did transfer this case under Section 1404(a)
and declined to rule on an argument that venue was not properly
laid, (id. at 14 n.13). As the Supreme Court has said, Section
1404(a) “operates on the premises that the plaintiff has
properly exercised his venue privilege.” Van Dusen, 376 U.S. at
634. For these reasons, this court concludes that venue was
properly laid in the transferor district and that transfer was
appropriate under 1404(a).
2
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selection clause, (see id.), and the matter was transferred to
this court under Section 1404(a), (id. at 14–15). In light of
these facts, the court concludes that California’s choice-of-law
rules apply.
California has adopted the governmental interest test for
most of its conflict-of-laws issues. See, e.g., Reich v.
Purcell, 67 Cal. 2d 551, 555–56 (1967). Under that approach,
courts “must search to find the proper law to apply based upon
the interests of the litigants and the involved states.”
Offshore Rental Co. v. Cont'l Oil Co., 22 Cal. 3d 157, 161
(1978), holding modified by I.J. Weinrot & Son, Inc. v. Jackson,
40 Cal. 3d 327 (1985). The first step in the governmental
interest test is to determine if there is, in fact, a true
conflict3 between California law and foreign law. Washington Mut.
Bank v. Superior Court, 24 Cal. 4th 906, 919 (2001). When there
is “no material difference [between two laws], there is no
choice-of-law problem and the court may proceed to apply
California law.” Frontier Oil Corp. v. RLI Ins. Co., 153 Cal.
App. 4th 1436, 1465, as modified (Sept. 5, 2007).
See Michael Traynor, Conflict of Laws: Professor Currie’s
Restrained and Enlightened Forum, 49 Cal. L. Rev. 845, 856
(1961) (“If the domestic policies of both states are the same,
there is no true conflict of laws.”).
3
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As stated above, both California and North Carolina have
adopted the UCC in its entirety, to include Section 2-207, the
most relevant provision in this case. Comparison of the two
states’ UCC 2-207 provisions reveal that there is no “material
difference” between them. Compare Cal. Com. Code § 2207, with
N.C. Gen. Stat. § 25-2-207. For that reason, this court will
specifically apply Cal. Com. Code § 2207, Frontier Oil Corp.,
153 Cal. App. 4th at 1465,4 and thus adopt the parties’
In the realm of contract interpretation, some California
courts have held that the governmental interest test does not
supplant the interpretation instructions in Section 1646 of the
California Civil Code. That provision states that “[a] contract
is to be interpreted according to the law and usage of the place
where it is to be performed; or, if it does not indicate a place
of performance, according to the law and usage of the place
where it is made.” Cal. Civ. Code § 1646. Other courts, however,
seem to disagree that Section 1646 overcomes the newer
governmental interest test. See Strassberg v. New England Mut.
Life Ins. Co., 575 F.2d 1262, 1263–64 (9th Cir. 1978) (per
curiam); see also Arno v. Club Med Inc., 22 F.3d 1464, 1468 n.6
(9th Cir. 1994) (collecting cases and noting conflict). The Arno
court pointed out that it was not necessary for it to resolve a
conflict in state law since the outcome under either test was
the same. Id.
4
This court is in the same position as the one in Arno. Even
if this court applied Section 1646, California law would still
result. Here, the purchase order was issued from California to
North Carolina via e-mail, and the chairs were shipped to a
Beaufurn warehouse in California prior to delivery. (See TCF
Purchase Order No. 5614 (Doc. 52-6); Kathy Ann Daywalt
Deposition (“Daywalt Dep.”) (Doc. 65-8) at 26-27.) This court is
satisfied that the contract was formed in California, either
when TCF sent the purchase order or received the order
acknowledgment. The place of performance was arguably also
California; chairs were shipped from North Carolina to an
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stipulation “that California law applies to the substantive
contractual issues.” (See Venue Order (Doc. 34) at 5.)
III. STANDARD OF REVIEW
In reviewing a motion for summary judgment, this court must
determine whether there remains a “genuine dispute as to any
material fact.” Fed. R. Civ. P. 56(a). “Once a defendant makes a
properly supported motion for summary judgment, the burden
shifts to the plaintiff to set forth specific facts showing that
there is a genuine issue for trial.” Sylvia Dev. Corp. v.
Calvert Cty., 48 F.3d 810, 817 (4th Cir. 1995). “On summary
judgment the inferences to be drawn from the underlying
facts . . . must be viewed in the light most favorable to the
party opposing the motion.” United States v. Diebold, Inc., 369
U.S. 654, 654 (1962) (per curiam). If there is no genuine
dispute about any fact material to the moving party’s claim,
then “the movant is entitled to judgment as a matter of law.”
Fed. R. Civ. P. 56(a).
A factual dispute is genuine when “the evidence is such
that a reasonable jury could return a verdict for the nonmoving
“Advance location” in California where they were held until
released by TCF to various TCF locations across the country.
(Daywalt Dep. (Doc. 65-8) at 10.) Whether analyzing under place
of performance or place of formation, California law would
apply.
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party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986); see also First Nat’l Bank of Ariz. v. Cities Serv. Co.,
391 U.S. 253, 289–90 (1968) (stating that a dispute is not
genuine for summary judgment purposes when one party rests
solely on allegations in the pleadings and does not produce any
evidence to refute alternative arguments). This court must look
to substantive law to determine which facts are material — only
those facts “that might affect the outcome of the suit under the
governing law will properly preclude the entry of summary
judgment.” Anderson, 477 U.S. at 247.
In addition, “the mere existence of some alleged factual
dispute between the parties will not defeat an otherwise
properly supported motion for summary judgment.” Id. Ultimately,
“there is no issue for trial unless there is sufficient evidence
favoring the nonmoving party for a jury to return a verdict for
that party.” Anderson, 477 U.S. at 249.
IV.
LAW OF THE CASE DOCTRINE
A.
Prior Venue Order & Arguments
Judge Olguin, in his order transferring this case to the
Middle District of North Carolina, thoroughly analyzed the
parties’ competing forms under UCC 2-207. Judge Olguin concluded
that “neither TCF nor Beaufurn provided specific and unequivocal
assent to the other parties’ additional terms and conditions”
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and that these additional terms were thus “trimmed” from the
contract. (Venue Order (Doc. 34) at 7.)
Beaufurn argues that, under the “law-of-the-case doctrine,”
Judge Olguin’s analysis should control and apply with equal
force to the insurance and indemnification provisions that are
the subject of the motions for summary judgment. (Def.’s Resp.
in Opp’n to Pl.’s Mot. for Partial Summ. J. (“Def.’s Resp.”)
(Doc. 67) at 6–9.) Specifically, Beaufurn argues that “the
California federal court explicitly held that all terms in
conflict between the parties’ two agreements were not part of
the final contract” and that this holding should govern unless
it is “clearly erroneous.” (Id.)
Plaintiff argues that Judge Olguin’s venue order is not the
law of the case. First, Plaintiff asserts that the analysis of
the forum selection and insurance/indemnification provisions is
substantively different. (Pl.’s Reply to Def.’s Resp. to Pl.’s
Mot. for Partial Summ. J. (“Pl.’s Reply”) (Doc. 70) at 2–3.)
Second, Plaintiff argues that this court has already rejected
the California order as the law of the case because this court
permitted Plaintiff to amend the complaint despite Defendants’
argument that amendment was futile in light of Judge Olguin’s
order. (See id. at 3.) Third, Plaintiff contends that new
evidence has now surfaced. (See id. at 4–5.) Specifically,
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Plaintiff argues that the record before Judge Olguin may have
suggested that Beaufurn initiated each transaction by sending
inventory sheets that constituted offers to sell. However,
Plaintiff argues that the deposition of Kathy Daywalt
(“Daywalt”), Beaufurn’s office manager responsible for the TCF
relationship, revealed new material facts relating to the
parties’ course of dealing — because Daywalt testified that
these inventory spreadsheets did not contain price or other
forward-looking information, these sheets were not offers and
the fact that Judge Olguin may have interpreted them as offers
justifies a new analysis of the substantive issues. (See Pl.’s
Reply (Doc. 70) at 4–5.)
Applying the law-of-the-case doctrine is a threshold issue
in this matter. If Judge Olguin’s analysis governs this court’s
decision on summary judgment, then this court can only conclude
that the conflicting insurance and indemnification provisions
drop out of the contracts. If, however, there is a valid reason
not to apply some or all of Judge Olguin’s analysis, then this
court must conduct its own independent examination of the
relevant contractual provisions.
B.
Legal Framework
“When a court decides upon a rule of law, that decision
should continue to govern the same issues in subsequent stages
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of the same case.” Arizona v. California, 460 U.S. 605, 618
(1983). And the Supreme Court has clearly explained “that the
doctrine applies as much [and sometimes with even greater force]
to the decisions of a coordinate court in the same case as to a
court’s own decisions” or those of the immediate appellate
court. Christianson v. Colt Indus. Operating Corp., 486 U.S.
800, 816 (1988). The law of the case “doctrine does not preclude
[a transferee court’s] reconsideration of previously decided
issues in extraordinary circumstances such as where: (1) new
evidence is available; (2) a supervening new law has been
announced; or (3) the earlier decision was clearly erroneous and
would create manifest injustice.” In re City of Philadelphia
Litigation, 158 F.3d 711, 718 (3d Cir. 1998); see also Arizona
v. California, 460 U.S. at 618 n.8 (“[I]t is not improper for a
court to depart from a prior holding if convinced that it is
clearly erroneous and would work a manifest injustice.”); Sejman
v. Warner-Lambert Co., 845 F.2d 66, 69 (4th Cir. 1988). The fact
that a transferor court did not adequately explain its decision
to apply a certain legal rule does not, by itself, render the
law of the case inapplicable in future proceedings.
Christianson, 486 U.S. at 817.
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C.
Analysis
Here, Judge Olguin of the Central District of California
ruled that neither party had clearly assented to the terms in
the other party’s boilerplate form, that the case fell under UCC
2-207(3), and that, under that rule, the conflicting forum
selection provisions dropped out of the contracts. (Venue Order
(Doc. 34) at 7.)
Judge Olguin’s determination that this case falls within
UCC 2-207(3) is equally applicable to whether any of the
competing insurance or indemnification provisions became part of
the contracts. First, Judge Olguin’s decision to disregard the
dueling form provisions and apply UCC 2-207(3) is exactly the
type of legal rule that constitutes the law of the case. This
decision was a necessary and integral step to reaching the
ultimate transfer decision; it was not dicta and thus should
apply with full force in later stages of the case barring any
extraordinary circumstance. See City of Philadelphia Litigation,
158 F.3d at 718–20 (stating that, where a certain legal
“determination was necessarily subsumed within the court’s
analysis of” a broader issue, that intermediate determination
qualified as the law of the case).
Second, despite Plaintiff’s arguments to the contrary, (see
Pl.’s Reply (Doc. 70) at 1-2), the Supreme Court has clearly
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explained that decisions of coordinate transferor district
courts are the law of the case and that the doctrine applies
with equal force to those decisions as to decisions of a
superior appellate court.5 Christianson, 486 U.S. at 816. And
this court disagrees with United States v. Lentz, 384 F. Supp.
2d 934, 939 (E.D. Va. 2005), to the extent that case may be read
to impose additional hurdles beyond those set forth in
Christianson to applying prior coordinate court rulings as the
law of the case.6 This court does not believe it would be proper
to disregard a coordinate court decision in the same case
addressing a substantive issue (as present here), outside of the
While these issues usually arise in the context of reevaluating the transfer decision itself, see, e.g.,
Christianson, 486 U.S. at 816 (“[T]ransferee courts that feel
entirely free to revisit transfer decisions of a coordinate
court threaten to send litigants into a vicious circle of
litigation.”), there are powerful reasons to apply Judge
Olguin’s ruling even to a subsequent decision that is not
directly related to venue. This court finds that, whenever
possible, it should seek to maintain internal consistency of
legal decisions within the same case to fulfill the parties’
expectations and promote respect for the law. If this court
disregarded Judge Olguin’s ruling for anything less than an
“extraordinary circumstance,” the parties would be improperly
subjected to inconsistent constructions of the same contractual
arrangement; this might create future uncertainty about how such
provisions will be interpreted. The three exceptions articulated
in Christianson strike an appropriate balance between
consistency and fairness.
5
Lentz dealt with evidentiary rulings, which present a
different question from the substantive legal ruling present
here. This court finds nothing in Lentz to be inconsistent with
its application of Judge Olguin’s venue order.
6
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three specific “extraordinary circumstances” listed in
Christianson. This court will follow the Supreme Court’s
directive that the doctrine applies equally to coordinate court
decisions.
This court also rejects Plaintiff’s characterization of
this court’s prior order granting Plaintiff’s motion to amend
the complaint. When this court permitted Plaintiff to amend its
complaint, the court stated: “Because the Central District of
California was analyzing forum selection clauses, not the
provisions at issue here, the court declines to adopt
Defendants’ view [that the venue order made the proposed
amendments futile].” (Doc. 50 at 3 n.3.) At that time discovery
was still ongoing, and this court was without the necessary
information to find whether or not any exception to the law-ofthe-case doctrine applied. While this court’s order could
perhaps have been drafted more clearly, futility is a high
standard and, at that early stage of the proceedings, it is
difficult to find that a proposed amendment is futile. See,
e.g., Johnson v. Oroweat Foods Co., 785 F.2d 503, 510 (4th Cir.
1986) (“Leave to amend . . . should only be denied on the ground
of futility when the proposed amendment is clearly insufficient
. . . on its face.”). Daywalt had not yet been deposed, and at
the time of this court’s order, it was entirely possible that
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new material evidence would come to light. This court merely
found that the proposed amendments were not futile at that time
and under the circumstances. This court did not disclaim future
application of the law of the case in accordance with
Christianson.
Plaintiff does not argue that Judge Olguin’s decision was
clearly erroneous or manifestly unjust, nor does Plaintiff
identify any change in the supervening law of contract
interpretation relevant to the UCC 2-207 analysis. Therefore,
the only question is whether new or substantially different
evidence justifies disregarding the law of the case and
conducting independent legal analysis of the substantive issues.
See City of Philadelphia Litigation, 158 F.3d at 718; Sejman,
845 F.2d at 69; see also Bishop v. Smith, 760 F.3d 1070, 1090
n.12 (10th Cir. 2014).
Evaluating all the evidence now before the court, Daywalt’s
deposition provides new, uncontroverted evidence that the
Beaufurn signature sheet making the sale of goods “expressly
conditioned upon” Beaufurn’s additional terms, (see Beaufurn Pro
Forma (Doc. 65-11) at 12), did not exist on or before
January 15, 2007. (See Daywalt Dep. (Doc. 65-8) at 35–36, 41,
46–48, 90.) According to Daywalt, the order acknowledgments, or
pro forma invoices, that were issued for purchase orders up to
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and including Purchase Order (“P.O.”) 3667 (Beaufurn Order No.
8144), stated only that the contract would be “subject to” or
“entered under” Beaufurn’s standard terms and conditions.
(Daywalt Dep. (Doc. 65-8) at 46–47; Beaufurn Pro Forma (Doc.
65-11) at 2–3.) This new evidence was not before Judge Olguin
when he issued his venue order. The evidence is material because
the “subject to” or “entered under” language is, as a matter of
law, generally insufficient to make Beaufurn’s acceptance
“expressly conditioned upon” TCF’s assent to additional terms
within the meaning of UCC 2-207(1). See, e.g., Dorton v. Collins
& Aikman Corp., 453 F.2d 1161, 1167 (6th Cir. 1972).
This court, therefore, finds that extraordinary
circumstances in the form of new evidence exist to abrogate the
law of the case as to any purchase order dated on or prior to
January 15, 2007. This includes P.O. 2716 placed on June 29,
2006, (see TCF Purchase Order No. 2716 (Doc. 65-4); TCF Purchase
Order No. 3619 (Doc. 65-5) (placed on December 29, 2006);
Beaufurn Pro Forma (Doc. 65-11) at 2–3 (documenting TCF Purchase
Order No. 3667 placed on January 15, 2007).) The court will
proceed to substantive analysis based on the new evidence
demonstrating that Beaufurn sent only a pro forma invoice, and
not a signature sheet, to TCF for these orders.
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As to the purchase orders dated after January 15, 2007,
this court finds that Judge Olguin’s decision to “trim” the
conflicting form provisions and apply UCC 2-207(3) is the law of
the case, that this decision was not clearly erroneous or
unjust, and that no new evidence has been introduced that would
materially impact this analysis. It appears Plaintiff did not
argue before Judge Olguin that it had not received signature
sheets for any relevant purchase orders. (See, e.g., Rebecca
Stobie Declaration (Doc. 17-9) (stating generally that signature
sheets were not signed and returned to Beaufurn, implying that
TCF did receive signature sheets for all orders but did not do
anything with those sheets).) While Plaintiff maintains that UCC
2-207(3) should not apply even conceding the receipt of
signature sheets, Plaintiff now argues that it is unclear
whether signature sheets were received for any purchase order
other than P.O. 5616. (See Pl.’s Mem. (Doc. 66) at 18–19.) But
this merely represents the evolution of Plaintiff’s legal
arguments. There is no new, material evidence proving that
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signature sheets were or were not received for the later
purchase orders.7
Plaintiff has made a stronger argument before this court
that signature sheets may not have been sent for these later
orders, based on both Daywalt’s uncertainty, (see Daywalt Dep.
(Doc. 65-8) at 92–93), and the lack of signature sheets for
certain purchase orders in Beaufurn’s records. But those facts
alone are insufficient to constitute an extraordinary
circumstance. Judge Olguin found that signature sheets were sent
for all purchase orders, that the acknowledgment constituted a
counteroffer, and that contracts were formed under UCC 2-207(3).
This court finds that new evidence renders his opinion erroneous
as to pre-January 15, 2007 purchase orders because Daywalt’s
testimony indicates the separate Beaufurn signature sheet did
not exist at that time. While Daywalt expressed uncertainty
about the lack of signature sheets in Beaufurn’s records for
certain later purchase orders, she also stated that “[s]tandard
procedure would be that we had a signature sheet with each
This court also finds that, even if Judge Olguin did in
fact consider the purchase orders to be acceptances of an
earlier offer to purchase from Beaufurn as Plaintiff suggests,
(see Pl.’s Reply (Doc. 70) at 4–5), this distinction ultimately
would not change the outcome. Assuming that TCF did receive
signature sheets for these later orders, in neither situation
would either party be deemed to have consented to the other’s
additional provisions under UCC 2-207(1).
7
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order.” (Daywalt Dep. (Doc. 65-8) at 92.) The brewing dispute
about the receipt of signature sheets for later orders is merely
a dispute about how to characterize Daywalt’s testimony; it is
not new evidence that constitutes an extraordinary circumstance
under Christianson. This court will apply the law-of-the-case
doctrine to any post-January 15, 2007 purchase orders, adopt
Judge Olguin’s analysis and decision to apply UCC 2-207(3), and
find that the conflicting insurance and indemnification
provisions did not become part of those contracts.
V.
UCC 2-207: BATTLE OF THE FORMS
A.
Legal Framework
Under Cal. Com. Code § 2207:
(1) A definite and seasonable expression of
acceptance or a written confirmation which is sent
within a reasonable time operates as an acceptance
even though it states terms additional to or different
from those offered or agreed upon, unless acceptance
is expressly made conditional on assent to the
additional or different terms.
(2) The additional terms are to be construed as
proposals for addition to the contract. Between
merchants such terms become part of the contract
unless:
(a) The offer expressly limits acceptance to
the terms of the offer;
(b) They materially alter it; or
(c) Notification of objection to them has
already been given or is given within a reasonable
time after notice of them is received.
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(3) Conduct by both parties which recognizes the
existence of a contract is sufficient to establish a
contract for sale although the writings of the parties
do not otherwise establish a contract. In such case
the terms of the particular contract consist of those
terms on which the writings of the parties agree,
together with any supplementary terms incorporated
under any other provisions of this code.
Judge Olguin clearly and capably analyzed the legal
framework of UCC 2-207 and the battle of the forms, as adopted
in California under Cal. Com. Code § 2207. (See Venue Order
(Doc. 34) at 6–7.) This court will not revisit that analysis
here, and instead incorporates Judge Olguin’s discussion of the
relevant legal standard in its entirety. See id.; see also
Steiner v. Mobil Oil Corp., 20 Cal. 3d 90, 98–108 (1977)
(explaining and applying § 2207 in the context of a “battle of
the forms” dispute).
B.
Arguments & Analysis
1.
Pre-January 15, 2007 Purchase Orders
This court agrees with Plaintiff that an acknowledgment
which simply purports to be made “under” or “subject to” the
offeree’s standard terms and conditions, (see, e.g., Beaufurn
Pro Forma (Doc. 65-11) at 22), operates as an acceptance under
Dorton and forms a contract under UCC 2-207(1). See, e.g.,
Dorton, 453 F.2d at 1168 (“Although Collins & Aikman’s use of
the words ‘subject to’ suggests that the acceptances were
conditional to some extent, we do not believe the acceptances
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were “expressly made conditional . . . .’”); see also Luria
Bros. & Co. v. Pielet Bros. Scrap Iron & Metal, Inc., 600 F.2d
103, 113 n.12 (7th Cir. 1979); MHD-Rockland Inc. v. Aerospace
Distribs. Inc., No. CCB–13–2442, 2014 WL 31677, at *4 & n.4 (D.
Md. Jan. 3, 2014) (collecting cases). This language gave no
express indication that Beaufurn was unwilling to proceed with
the transaction unless TCF consented to additional terms.
Therefore, the pro forma invoice did not constitute a
counteroffer but rather accepted TCF’s initial offer. TCF’s
terms became part of the contract and Beaufurn’s proposed
additions dropped out pursuant to UCC 2-207(2) because they
would have materially altered the agreement. See, e.g., TransAire Int’l, Inc. v. N. Adhesive Co., 882 F.2d 1254, 1261–63 (7th
Cir. 1989); C9 Ventures v. SVC-West, L.P., 202 Cal. App. 4th
1483, 1488 (2012) (“[A]n indemnification provision is deemed a
material alteration to an agreement as a matter of law.”).
Beaufurn attempts to distinguish the Dorton holding because
that case did not involve a true “battle of the forms”
situation. (See Def.’s Resp. (Doc. 67) at 14–15.) Beaufurn
argues that “Dorton involved one party who purportedly sought to
impose an arbitration provision while the other party’s document
was silent on the matter.” (Id.) In this case, on the other
hand, the parties exchanged documents with separate, conflicting
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contractual provisions. However, that factual distinction is
irrelevant to the specific point on which Dorton is most
persuasive: whether purporting to make an acceptance “subject
to” additional terms suffices to make that acceptance “expressly
conditional” and thus transforms it into a rejection and
counteroffer. Beaufurn offers no case law to support the
proposition that “subject to” means “expressly conditioned upon”
under UCC 2-207(1). Once the pro forma invoices are viewed as
acceptances rather than counteroffers, a plain reading of UCC
2-207(1) shows that the offeror’s terms become part of the
contract. This court finds Dorton applicable and finds that
TCF’s insurance and indemnification provisions became part of
the contractual agreement for the earlier purchase orders.
For all purchase orders prior to and including P.O. 3667,
this court finds the evidence in its entirety (accounting for
Daywalt’s deposition testimony and other new evidence not before
Judge Olguin) sufficient to determine beyond any doubt that a
separate signature sheet was not sent to TCF. According to
Daywalt’s uncontroverted testimony, the sheet did not exist at
that time. (See Daywalt Dep. (Doc. 65-8) at 35–36, 46–48.)
Therefore, as to the following orders — P.O. 2716 placed on
June 29, 2006, (see Doc. 65-4), P.O. 3619 placed on December 29,
2016, (see Doc. 65-5), and P.O. 3667 placed on January 15, 2007,
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(see Beaufurn Pro Forma (Doc. 65-11) at 4–5) — and any other
purchase orders placed prior to or on January 15, 2007,
Beaufurn’s response accepted TCF’s terms pursuant to UCC
2-207(1). For those orders, this court finds that the terms and
conditions attached to TCF’s purchase orders controlled the
contracts between TCF and Beaufurn and that summary judgment
should be granted to Plaintiff on that issue. This court further
finds that summary judgment should be granted to Plaintiff,
precluding Beaufurn from using its own terms and conditions as a
defense and striking Beaufurn’s Fifteenth Affirmative Defense,
as it relates to those specific purchase orders.
2.
Post-January 15, 2007 Purchase Orders
This court will apply Judge Olguin’s analysis to the postJanuary 15, 2007 purchase orders as the law of the case. (See
Venue Order (Doc. 34) at 6–7.) Beaufurn’s signature sheet made
acceptance of TCF’s offers expressly conditional on TCF’s assent
to new terms. Because TCF did not return a signed signature
sheet and thus did not seasonably indicate acceptance of those
new terms, no contract was formed until performance. That
contract, pursuant to UCC 2-207(3), included only those terms on
which the parties had expressly agreed — price and quantity, but
not the conflicting insurance and indemnification provisions.
While the law-of-the-case doctrine is sufficient to decide the
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issue, this court will also briefly explain why it agrees with
Judge Olguin’s analysis.
Plaintiff would have this court hold, under Dorton, that
even an order acknowledgment stating it is “expressly
conditioned upon” assent to new, material terms in the
acknowledgment (thus directly tracking the language of UCC
2-207(1)) will accept the offer and bind the offeree to the
terms contained in the offer. (See Pl.’s Mem. of Law in Opp’n to
Def.’s Mot. for Summ. J. (“Pl.’s Resp.”) (Doc. 68) at 16 (“In
any event, the language of the above clause is insufficient
under Dorton to invalidate Beaufurn’s acceptance because it
merely attempted to make Beaufurn’s sale of any goods
conditioned on Beaufurn’s ‘terms.’ This language did not make
Beaufurn’s acceptance of TCF’s purchase orders expressly
conditioned on TCF’s ‘assent’ to those terms.”).) This court
finds that Plaintiff is attempting to make a distinction without
substantive meaning, one that even the Dorton court was not
required to make to reach its holding.
Plaintiff argues that an acknowledgment which states it is
“expressly conditioned upon” new terms is not really “expressly
conditional” unless it unequivocally makes acceptance
conditional upon the counterparty’s assent to those terms.
(Pl.’s Mem. (Doc. 66) at 17.) First, the acknowledgment in
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Dorton itself stated only that “the acceptances (or orders) were
‘subject to all of the terms and conditions on the face and
reverse side hereof, including arbitration, all of which are
accepted by buyer.’” Dorton, 453 F.2d at 1167 (emphasis added).
Any piece, therefore, of the Dorton holding that might be read
to require use of the terms “expressly conditioned upon” and
“assent to,” directly following one another and in that specific
order, would be dicta because the court was considering an
acknowledgment that looked significantly less like the actual
language of UCC 2-207(1) than the acknowledgment at issue here.
Second, the Beaufurn signature sheet states: “The sale of
any goods covered by this Order Acknowledgment is expressly
conditioned upon the terms contained herein (including the Terms
and Conditions on the attached and/or located on Seller’s
website at www.beaufurn.com). Purchaser’s assent to [those]
terms . . . shall be conclusively presumed . . . .” (Beaufurn
Pro Forma (Doc. 65-11) at 12 (emphasis added).) Beaufurn’s
acknowledgment, therefore, does in fact reference the
counterparty’s assent to additional terms.
As other courts have observed, “an acceptance which
precisely follows § 2-207(1) clearly forestalls contract
formation.” PCS Nitrogen Fertilizer, L.P. v. Christy
Refractories, L.L.C., 225 F.3d 974, 979 (8th Cir. 2000); see
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also Ionics, Inc. v. Elmwood Sensors, Inc., 110 F.3d 184, 185
189 (1st Cir. 1997); C. Itoh & Co. (Am.) Inc. v. Jordan Int’l
Co., 552 F.2d 1228, 1235–36 (7th Cir. 1977). And “[t]o require
the exact language of the UCC would be too formalistic and
inconsistent with the UCC’s requirement that its provisions be
liberally construed.” White v. Consol. Indus., Inc. v. McGill
Mfg. Co., 165 F.3d 1185, 1191 (8th Cir. 1999); see also Ralph
Shrader, Inc. v. Diamond Int’l Corp., 833 F.2d 1210, 1215 & n.4
(6th Cir. 1987) (finding that an acknowledgment which stated
additional terms and provided that those terms “are the only
ones upon which we will accept orders” was expressly
conditional; rejecting the argument that language must exactly
mimic UCC 2-207(1)).
Beaufurn’s signature sheet used the words “expressly
conditioned upon” and referenced TCF’s “assent” to additional
terms. This court finds that the signature sheet language is
sufficiently similar to UCC 2-207(1) to make Beaufurn’s
acceptance of the offer “expressly conditional” on TCF’s assent
to new material terms. Therefore, Beaufurn’s later
acknowledgments were counteroffers that rejected TCF’s
boilerplate provisions and brought the parties into the realm of
UCC 2-207(3).
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For those purchase orders dated after January 15, 2007 —
P.O. 5597 dated December 3, 2007, (see Doc. 65-3), P.O. 5614
dated December 3, 2007, (see Doc. 52-6), P.O. 5615 dated
December 3, 2007, (see Doc. 52-7), P.O. 5616 dated December 3,
2007, (see Doc. 52-8), and any other such purchase orders — this
court finds that neither party’s insurance or indemnification
provisions became part of the contractual agreement. Beaufurn,
therefore, is entitled to summary judgment for any claims
premised upon a breach of those provisions. For purchase orders
dated after January 15, 2007, all claims against Beaufurn based
upon the alleged breach of the insurance or indemnification
provisions in TCF’s terms and conditions will be dismissed (the
first, second, tenth, and eleventh causes of action).
VI.
MISCELLANEOUS ISSUES
Two issues remain for this court to address. First is
Plaintiff’s claim for equitable subrogation; this claim is
allowed to proceed. Second is the issue of alleged defendants
John Does 1–10. Though Defendant Beaufurn did not move for
summary judgment on the counts related to the Doe defendants
(claims 7, 8, and 9), those counts are dismissed for the reasons
stated below.
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A.
Equitable Subrogation Claim
1.
Legal Framework & Arguments
Beaufurn further argues that the third cause of action,
Plaintiff’s claim for equitable contribution or subrogation
against Beaufurn, should be dismissed because “Plaintiff either
insufficiently pleaded and cannot maintain that cause of action,
and/or Plaintiff has not and cannot present evidence
demonstrating Beaufurn’s fault or negligence in the underlying
lawsuit.” (Def.’s Mem. (Doc. 64) at 22.) Plaintiff responds that
“TCF’s decision to not draw Beaufurn into the Kinzler Action”
did not absolve Beaufurn of liability for the chair that
allegedly caused Kinzler’s injuries, that the third cause of
action is a proper subrogation claim, and that “conflicting
expert opinions” regarding whether the subject chair was
negligently designed by Beaufurn preclude summary judgment on
the claim. (Pl.’s Resp. (Doc. 68) at 18–22.) Beaufurn replies
that “any fault-based equitable subrogation claim against
Beaufurn must fail” because Plaintiff cannot identify above a
50% probability which specific chair caused Kinzler’s injury.
(Def.’s Reply to Pl.’s Resp. to Def.’s Mot. for Summ. J.
(“Def.’s Reply”) (Doc. 69) at 11-12.)
As one California court explained,
[e]quitable contribution permits reimbursement to the
insurer that paid on the loss for the excess it paid
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over its proportionate share of the obligation, on the
theory that the debt it paid was equally and
concurrently owed by the other insurers and should be
shared by them pro rata in proportion to their
respective coverage of the risk.
Fireman’s Fund Ins. Co. v. Md. Cas. Co., 65 Cal. App. 4th 1279,
1293 (1998) (“Fireman’s 1998”). “The reciprocal rights and
duties of multiple insurers which cover the same event do not
arise out of contract, for their agreements are not with each
other” but rather with the insured party (here, TCF). Certain
Underwriters at Lloyds, London v. Arch Specialty Ins. Co., 246
Cal. App. 4th 418, 428–29 (2016). Equitable contribution “exists
independently of the rights of the insured . . . and assumes the
existence of two or more valid contracts of insurance covering
the particular risk of loss and the particular casualty in
question.” Fireman’s 1998, 65 Cal. App. 4th at 1295.
Equitable contribution claims are separate and distinct
from equitable subrogation claims, where an insurer stands in
the shoes of the insured and brings a derivative suit “against
the party legally and primarily responsible for the loss.” Id.
at 1295–96. “Equitable subrogation permits a party who has been
required to satisfy a loss created by a third party’s wrongful
act to step into the shoes of the loser and pursue recovery from
the responsible wrongdoer.” Fireman’s Fund Ins. Co. v. Md. Cas.
Co., 21 Cal. App. 4th 1586, 1595–96 (1994) (“Fireman’s 1994”).
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“The subrogated insurer . . . has no greater rights than the
insured and is subject to the same defenses assertable against
the insured.” Reliance Nat’l Indem. Co. v. Gen. Star Indem. Co.,
72 Cal. App. 4th 1063, 1078 (1999).
When an insurer seeks equitable subrogation after
it has paid a claim for an insured, the insurer must
establish that (1) the insured suffered a loss for
which the defendant is liable, either (a) because the
defendant is a wrongdoer whose act or omission caused
the loss or (b) because the defendant is legally
responsible to the insured for the loss caused by the
wrongdoer; (2) the insurer has compensated the insured
for the loss for which the defendant is liable; (3)
the insured has an existing, assignable cause of
action against the defendant which the insured could
have asserted had it not been compensated by the
insurer; (4) the insurer has suffered damages caused
by the act or omission upon which the liability of the
defendant depends; (5) justice requires that the loss
should be shifted from the insurer to the defendant,
whose equitable position is inferior to that of the
insurer; and (6) the insurer’s damages are in a stated
sum, usually the amount paid to its insured.
Fireman’s Fund Ins. Co v. Wilshire Film Ventures, Inc., 52 Cal.
App. 4th 553, 555–56 (1997).
Plaintiff labeled the third cause of action “Equitable
Contribution,” (see Am. Compl. (Doc. 52) ¶¶ 46–49), leading
Beaufurn logically to conclude that the claim most likely
alleged equitable contribution, (see Def.’s Mem. (Doc. 64) at
16). However, in its response to Beaufurn’s motion for summary
judgment, Plaintiff cited Fireman’s 1998 for the difference
between an equitable contribution and subrogation claim and
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argued that the third cause of action is an equitable
subrogation claim. (Pl.’s Resp. (Doc. 68) at 18–19.) This court
finds that Plaintiff intended to bring an equitable subrogation
claim against Beaufurn: Plaintiff alleges that Beaufurn’s
negligence caused Kinzler’s injury, that TCF was forced to
compensate Kinzler for the harm caused by this negligence, and
that equity demands Plaintiff (standing in the shoes of TCF)
should be compensated by Beaufurn for the loss.
Once Plaintiff clarified that it intended to bring an
equitable subrogation claim, Beaufurn argued that such a claim
is precluded because there is no dispute of material fact as to
whether Beaufurn is “a wrongdoer whose act or omission caused
the loss” to TCF that Plaintiff now attempts to recover. (See
Def.’s Reply (Doc. 69) at 12 (“There were other possible causes
unrelated to the design of the chair, such as the way Kinzler
sat, the movement of her body on the chair, and the condition of
the floor.”).) Specifically, based on the injured customer’s
expert testimony provided in the Kinzler matter, Beaufurn argues
“there was just a 10% chance Kinzler was sitting on a chair with
issues,” (id.), and that Plaintiff therefore cannot establish to
the required degree of certainty that the “allegedly defective
product was actually the product that caused harm to a
plaintiff.” (Id. at 11.) Because even Kinzler’s own expert
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conceded in that litigation that only three out of twenty-nine
chairs might be defective, and because there were other possible
causes of Kinzler’s fall, Beaufurn argues that “the jury would
be left with mere speculation as to what product caused the
plaintiff to be injured.” (Id. at 12.) Plaintiff, on the other
hand, points to “[t]he conflicting expert opinions” in the
underlying case and argues that those opinions illustrate a
dispute of material fact that precludes summary judgment. (Pl.’s
Resp. (Doc. 68) at 21.)
2.
Analysis
This court understands Beaufurn’s argument as follows:
there is no dispute of material fact regarding whether an
allegedly defective chair manufactured by Beaufurn caused
Kinzler’s injury because the facts uncovered in the Kinzler
litigation all point strongly to other causes and because TCF
argued in the Kinzler litigation that the chairs were not
defective. First, this court does not accept Beaufurn’s
contention that proximate cause requires a showing that the
allegedly defective product “more likely than not” caused the
injury. (See Def.’s Reply (Doc. 69) at 11–12.) Rather,
California courts have consistently held that: (1) proximate
cause normally requires the defendant’s action be a but-for
cause of the harm and liability be consistent with public policy
-34-
considerations, see State Dep’t of State Hosps. v. Superior
Court, 61 Cal. 4th 339, 352–53 (2015), and (2) when there are
concurrent independent causes, proximate cause requires that the
defendant’s actions be a “substantial factor” in causing the
injury, see, e.g., Mitchell v. Gonzales, 54 Cal. 3d 1041, 1052–
54 (1991). Further, “[o]rdinarily, proximate cause is a question
of fact which cannot be decided as a matter of law from the
allegations of a complaint.” Weissich v. Cty. of Marin, 224 Cal.
App. 3d 1069, 1084 (1990).
To this court, neither test described above would require a
showing that a manufacturing defect in the chairs “more likely
than not” caused Kinzler’s fall. And, in any event, this court
is not satisfied that proximate cause should be decided as a
matter of law in this case so long as there is a dispute of
material fact over whether a defective chair caused the injury.
On the contrary, the very outcome of the Kinzler litigation
suggests that there is at least some outstanding dispute of
material fact regarding whether the subject chairs were or are
defective. Kinzler submitted expert reports in that case
stating, among other things, that “the front-to-back placement
of the seats over the front legs” was abnormal and unstable and,
when combined with the slippery floor, caused Kinzler to fall.
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(See Kinzler v. The Cheesecake Factory, Inc., No. 2:14-cv-346MRH (W.D. Pa.) (Doc. 23-1) at 8.)
TCF proffered competing expert testimony stating that
“[t]he cause of Ms. Janet Kinzler’s fall was her sliding off the
chair while she was adjusting herself, as opposed to the chair
kicking out while she was toasting.” (See id. (Doc. 49-1) at
19.) But TCF neither moved for nor obtained summary judgment on
that issue; in fact, it appears from the docket that the parties
were preparing for trial at the time they settled.
Second, this court does not believe that any of TCF’s
representations in the Kinzler litigation should bind Plaintiff
here. “When the insured makes affirmative statements or
admissions about the facts of his claim, particularly those
facts within the insured’s own knowledge, it may be appropriate
to hold that the subrogated insurer is bound by those statements
or admissions” in a subsequent subrogation claim. Great Am. Ins.
Cos. v. Gordon Trucking, Inc., 165 Cal. App. 4th 445, 452
(2008). Here, however, any statement or admission by TCF is
based on “matters not within [its] personal knowledge” — namely,
the design and construction of Beaufurn’s bar stools. Id. TCF
has no specialized knowledge of Beaufurn’s design and
manufacturing process. Rather, it merely engaged an expert to
examine the subject chairs in the same way that Kinzler did. The
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fact that TCF’s expert reached a certain conclusion should not
bind Plaintiff, where there was no final adjudication or release
of liability in the underlying action. See id.
While Beaufurn may ultimately be correct “that there is
nothing defective about the subject barstool . . . or any other
barstools of the same or similar type,” this court cannot grant
summary judgment solely on the basis of “strong evidence” when
any material fact remains legitimately in dispute. (Def.’s Mem.
(Doc. 64) at 21.) This court finds that Beaufurn’s motion for
summary judgment on the third cause of action should be denied.
B.
Doe Defendants
Plaintiff also brings three separate causes of action
against ten unidentified defendants (John Does 1-10). (See Am.
Compl. (Doc. 52) ¶¶ 68–82.) John Does 1-10 are alleged to be
excess, umbrella or other insurers of Beaufurn. (Id. ¶¶ 8–9.)
Neither party addresses these claims in its motion for summary
judgment. Because this case has proceeded through discovery
without identification of John Does 1-10, the claims are now
subject to dismissal. See Hindes v. F.D.I.C., 137 F.3d 148, 155
(3d Cir. 1998) (“The case law is clear that fictitious parties
must eventually be dismissed, if discovery yields no identities,
and that an action cannot be maintained solely against Doe
defendants.”) (internal citations and punctuation omitted); see
-37-
also Johnson v. City of Ecorse, 137 F. Supp. 2d 886, 892 (E.D.
Mich. 2001). While Beaufurn has not specifically moved for
summary judgment on these claims, this court finds that the
seventh, eighth and ninth causes of action should be dismissed.
VII. CONCLUSION
For the foregoing reasons, this court finds that
Plaintiff’s motion for partial summary judgment should be
granted in part and denied in part and that Beaufurn’s motion
for summary judgment should be granted in part and denied in
part.
IT IS THEREFORE ORDERED that Plaintiff’s Motion for Partial
Summary Judgment, (Doc. 65), is GRANTED IN PART AND DENIED IN
PART, in that the motion is GRANTED as to all sales conducted
pursuant to purchase orders dated prior to or on January 15,
2007, and DENIED as to all sales conducted pursuant to purchase
orders dated after January 15, 2007.
IT IS FURTHER ORDERED that Defendant Beaufurn, LLC’s Motion
for Summary Judgment, (Doc. 63), is GRANTED IN PART AND DENIED
IN PART, in that the motion is DENIED as to all sales conducted
pursuant to purchase orders dated prior to or on January 15,
2007, GRANTED as to all sales conducted pursuant to purchase
orders dated after January 15, 2007, and DENIED as to
Plaintiff’s Third Cause of Action.
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IT IS FURTHER ORDERED that the Seventh, Eighth and Ninth
Causes of Action are hereby DISMISSED.
A partial judgment reflecting this memorandum opinion and
order will be entered contemporaneously herewith.
This the 23rd day of September, 2019.
_______________________________________
United States District Judge
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