Dansie et al v. Eaton Corporation et al

Filing 40

MEMORANDUM DECISION granting 7 Motion to Dismiss; granting 9 Motion to Dismiss for Failure to State a Claim; finding as moot 9 Motion for Judgment on the Pleadings. Signed by Judge Robert J. Shelby on 03/18/2013. (tls)

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
CENTRAL DIVISION

TOM DANSIE and CATHERINE DANSIE,
Plaintiffs,

MEMORANDUM DECISION
AND ORDER

vs.

EATON CORPORATION, et al.,

Case No. 2:12-cv-214

Defendants.

On February 13, 2013, the court held a hearing in the above-captioned matter on two
motions: (1) a Motion to Dismiss and for Judgment on the Pleadings filed by Defendants Eaton
Corporation and Eaton Aeroquip, Inc. (collectively “Eaton”); and (2) a Motion to Dismiss filed
by Defendant CBS Corporation (CBS). For the reasons stated at the hearing, and for the reasons
discussed below, the court GRANTS both motions.
BACKGROUND
Plaintiffs Tom Dansie and Catherine Dansie bring this action to recover for damages that
Mr. Dansie received in a serious industrial accident. On February 2, 2006, Mr. Dansie was
working at an incinerator facility in Aragonite, Utah when flammable materials escaped from a
hose. These materials erupted into a fire ball and Mr. Dansie sustained extensive injuries over
the majority of his body. Mr. Dansie alleges that his past medical bills exceed $2 million. The
Dansies contend that the cause of the accident was a tear in a Teflon hose that was covered by a
stainless steel mesh. According to the Plaintiffs, the tear may have been caused by defective

manufacturing, improper installation, or improper adjustment.
The case currently pending before the court is not the first action that the Plaintiffs have
filed against these Defendants. The Dansies previously filed an action that was heard by the
Honorable Dee Benson. See Dansie v. Eaton Corp., Case No. 2:07-cv-963. In this case, the
causes of action that the Dansies alleged against Eaton were divided into two categories of
claims. First, the Dansies asserted that Eaton was directly liable for the Dansies’ injuries as the
manufacturer or seller of the hose allegedly involved in the injurious fire under theories of strict
product liability, negligence, breach of implied warranties, and breach of express warranty. (Am.
Complaint, at 5-8, Dkt. No. 72 in Case No. 2:07-cv-963.) Second, the Dansies alleged that Eaton
was liable for the Dansies’ injuries under a successor liability theory. (Id. at 8.) The Dansies
later filed a Motion for Leave to Amend the Complaint. (Dkt. No. 114 in Case No. 2:07-cv-963.)
In its Proposed Second Amended Complaint, the Dansies sought to add a new claim for relief
against Eaton under the theory of successor liability contained in the Restatement (Third) of
Torts: Products Liability § 13. This new cause of action alleged that Eaton, as a successor to the
company who manufactured or sold the hose, owed an independent, post-asset sale duty to warn
its predecessor’s customers of defects in the hose.
Judge Benson dismissed the Dansies’ first category of claims because he found that the
Plaintiffs “set forth no facts to demonstrate the plausibility of their claim that Eaton
manufactured or sold the hose at the center of this litigation.” (Order, at 3, May 3, 2011.) In his
ruling, Judge Benson took judicial notice of facts that supported the theory that Eaton was not the
manufacturer of the faulty hose. These facts included an investigative report issued by the Utah
Labor Commission that concluded that the hose was installed in 1994, eight years before Eaton
2

acquired any hose manufacturing assets from its predecessor company, Dana Corporation (Dana).
(Id.)
Judge Benson dismissed the Dansies’ direct liability claims without prejudice and
provided that “Plaintiffs may revive their claims against Eaton upon timely discovery of facts
that make plausible an allegation that Eaton manufactured or sold the subject hose.” (Id. at 4.)
Judge Benson also noted that Eaton had consented to provide responses to limited, focused
discovery on the sole issue of the manufacture and sale of the hose between September 30, 2002
(the date when Eaton acquired the hose manufacturing assets from Dana), and the date of Mr.
Dansie’s injury. (Id.) Judge Benson dismissed the Dansies’ successor liability claim with
prejudice because he found that the Dansies voluntarily extinguished this claim when they settled
their claims with Dana. (Id. at 4.)
Finally, Judge Benson denied the Dansies leave to amend their complaint. (Id. at 7.) He
found that the factual allegations underlying the Dansies’ successor liability claim based on a
post-sale duty to warn were insufficient to satisfy the Twombly pleading standards. (Id.); Bell
Atlantic Corp. v. Twombly, 550 U.S. 544 (2007).
CBS was also a Defendant in the lawsuit in front of Judge Benson. According to the
Dansies, CBS was liable for the Dansies’ injuries as a former operator of the hazardous waste
incinerator in which Mr. Dansie was injured. Judge Benson dismissed the claims against CBS
because he concluded that CBS was not an operator of the incinerator: “CBS Corporation’s only
connection to the facility was as a shareholder to National Electric, Inc., which was a shareholder
of Aptus, Inc., an entity that owned the incinerator in the 1990s.” (Id. at 6.) The court found that
the Dansies “failed to allege any fact that would lead the Court to conclude that there was a
3

plausible cause of action against CBS Corporation due to its remote, both in time and ownership,
interest in and control over the incinerating facility.” (Id.)
On February 24, 2012, the Dansies filed the action that is currently pending before this
court. The Dansies have alleged many of the same causes of action against Eaton and CBS, and
these two parties now move the court to dismiss this second case against them.
ANALYSIS
1.

Eaton’s Motion to Dismiss and for Judgment on the Pleadings
As in the action in front of Judge Benson, the Dansies allege a number of causes of action

against Eaton based on the theory that Eaton is directly liable for Mr. Dansie’s injuries as the
manufacturer or seller of the hose. This claims include causes of action for strict liability,
negligence, breach of implied warranties, and breach of express warranty. The Dansies also
maintain that Eaton is liable under the theory that it owed a post-sale duty to warn end users
about defects in any products manufactured by its predecessor, Dana.
The court finds that these claims are almost identical to the claims that were dismissed by
Judge Benson. While those claims were dismissed without prejudice, a dismissal without
prejudice is not an invitation to submit largely identical claims to a new judge. By submitting
almost identical claims, the Dansies have placed the court in the unusual position of an almost
appellate review of Judge Benson’s decision. The court declines to substitute its own judgment
for the judgment of Judge Benson unless the Dansies can demonstrate that their new claims are
sufficiently distinct.
The court finds that the Dansies have failed to carry this burden. Judge Benson was clear
that, in order to re-assert any direct liability claims against Eaton, the Plaintiffs would have to
4

come forward with “facts that make plausible an allegation that Eaton manufactured or sold the
subject hose.” But the only new information provided by the Dansies in the current action is an
allegation that Eaton used the same Boston Weatherhead products and part numbers that were
used by Dana. That information, which is not materially different from the information that was
in front of Judge Benson, is insufficient to overcome the findings from the Utah Labor
Commission and the Dansies’ previous admissions demonstrating that the hose was likely
manufactured in 1994 and therefore must have been manufactured by Dana and not Eaton.
Without more compelling evidence, the court cannot allow the Dansies to re-argue the same
claims against Eaton simply because they have brought their case before a new judge.
The court notes that the Dansies declined to engage in any discovery permitted by Judge
Benson, even though Eaton consented to participate in that discovery. The court will not allow
the Plaintiffs a second chance to conduct this discovery now.
The court also dismisses the Dansies’ claim that Eaton owed a post-sale duty to warn end
users about defects in the products created by its predecessor. Judge Benson already denied the
Dansies leave to amend their complaint to add a claim that is not materially different from the
claim that the Dansies now present to the court. The only new information the Dansies identified
in their latest Complaint is the existence of an Asset Purchase Agreement (APA) between Dana
and Eaton. But the Dansies have not demonstrated that any provision of the APA required Eaton
to assume a duty to monitor, service, or maintain hoses sold by Dana before Eaton purchased
Dana’s assets.
In order to show that Eaton had a post-sale duty to warn, the Dansies must allege that
Eaton undertook or agreed to provide service for maintenance or repair of Dana’s products or
5

entered into a similar relationship with purchasers of Dana’s products giving rise to actual or
potential economic advantage to Eaton. See Restatement (Third) of Torts: Products Liability
§ 13. While the Dansies recite this language in their Complaint, the provisions of the APA that
the Dansies point to simply state that Eaton assumed all product warranty obligations for
products manufactured by Dana and agreed to hold Dana harmless for any future liability arising
out of accidents involving Dana’s products. The product warranty provision does not establish a
service and maintenance relationship with users of Dana’s products, but merely states that Eaton
will honor any product warranties. And the hold harmless provision is not applicable here
because Judge Benson held that Dana’s liability was extinguished when it reached a settlement
with the Dansies.
In any event, the Dansies must also plead sufficient facts to meet the second prong of
Section 13 of the Restatement, which requires the Plaintiffs to show that a reasonable person in
the position of the successor company would provide a warning. The Dansies’ argument that
Eaton should have warned end users of possible defects in Dana’s products, even if those
products were purchased twelve years earlier, would greatly expand liability under Section 13.
The court is not persuaded by this argument, especially since the Dansies have not pled any facts
to suggest why a reasonable person in Eaton’s position would have even known of possible
defects in the hose at the incinerator, let alone provide a warning. Even with the addition of the
provisions in the APA that the Dansies cite, the court agrees with Judge Benson that the Dansies
have not pled a plausible claim for relief for a post-sale duty to warn.
The Dansies’ final claim against Eaton for loss of consortium is derivative of the Dansies’
other claims. Because the court dismisses the Dansies’ allegations of direct and successor
6

liability against Eaton, there is no basis on which the Dansies may proceed with their loss of
consortium claim.
For the reasons discussed above, the court finds that the Dansies failed to cure the
deficiencies that Judge Benson mentioned in his Order dismissing the claims against Eaton in
their first case. Accordingly, the Court GRANTS Eaton’s Motion to Dismiss and for Judgment
on the Pleadings.
2. CBS’s Motion to Dismiss
The court finds that the claims asserted by the Dansies against CBS are indistinguishable
from the claims that Judge Benson dismissed in the previous case. If anything, the Dansies’ have
altered the language in their current Complaint to make the allegations against CBS more vague
than the allegations in Judge Benson’s case. The Dansies have not pled facts to show that CBS
has any connection to the incinerating facility that is more direct than as the shareholder of a
shareholder of an operator. As Judge Benson ruled, the court finds that CBS’s interest and
control over the facility is too remote to support liability.
Because the Dansies failed to cure the deficiencies that Judge Benson found in the
previous case, the court GRANTS CBS’s Motion to Dismiss.
CONCLUSION
As discussed above, the court GRANTS Eaton’s Motion to Dismiss (Dkt. No. 9) and
CBS’s Motion to Dismiss (Dkt. No. 7). Because the Dansies were unable to bring forward
sufficient facts to support their claims against these two parties after Judge Benson denied their
original claims without prejudice, the court declines to allow the Plaintiffs a second opportunity
to do so. Accordingly, the court DISMISSES WITH PREJUDICE all claims against Eaton and
7

CBS, and each party shall bear its own attorneys’ fees and costs.
The court notes that its reasoning in this Order does not apply to the remaining
Defendants in this lawsuit, who have not yet been served but who may have a more direct
connection to the facility and accident that were the subject of the Plaintiffs’ claims. The court
has granted the Dansies the time that is allowed under Rule 4(a) of the Federal Rules of
Appellate Procedure for filing a notice of appeal based on the dismissal of Eaton and CBS to
decide whether to proceed with the remaining claims against these Defendants.
SO ORDERED this 18th day of March, 2013.
BY THE COURT:

______________________________
ROBERT J. SHELBY
United States District Judge

8