By Leah S. Poniatowski, J.D.
Yacht insurer did not offer plausible evidence of a defect or that the alleged defect was the proximate cause of an engine fire.
A products liability lawsuit, arising out of a yacht engine fire, filed against the manufacturer of marine impeller pumps failed for lack of sufficient direct or circumstantial evidence of a defect, a federal district court in Florida ruled, applying admiralty law. In addition, the court determined that there was evidence that there was an intervening cause leading to the damaging engine fire. Thus, even if the insurer had satisfied its burden establishing evidence of a defect, the alleged failure of the affected engine’s impeller pump was not the proximate cause of the damage to the vessel, the court concluded (National Union Fire Insurance Co. of Pittsburgh PA v. SPX Flow US, LLC, August 15, 2019, Bloom, B.).
A motor yacht was damaged after the engine overheated and a fire broke out. National Union Fire Insurance Company of Pittsburgh PA, the vessel’s insurer, filed a products liability lawsuit against SPX Flow US, LLC, the distributor and seller of marine impeller pumps, asserting that the pump was defective and that it caused the engine incident.
Pump operation. The vessel’s engines were attached with impeller pumps at the time it was sold. The pumps were part of the engine cooling system, pulling in seawater via spinning blades and pumping the water into the heat exchanger. The cooling system was monitored by several sensors, notably the seawater flow sensor, which alerts when there is insufficient seawater circulating through the engine. However, it was discovered after a prior engine incident that the engine temperature sensor of the vessel at issue had not been connected to the alarm buzzer, and the vessel’s owner did not check or have anyone else check to ensure that all the sensors were properly connected as instructed by the operation manual. The owner also had expressed his concern that the alarm might not be sufficiently audible to his mechanic.
Engine failure. The owner took out the vessel in order to place it in summer storage 120 miles away, and after an hour into the journey, the alarm sounded. The light bulb in the starboard engine temperature gauge had burned out, but the owner was able to use a flashlight to see that the gauge was pegged, prompting him to turn off the starboard engine. He proceeded to operate the vessel with the port engine and he stopped at a mile marker to inspect the engine. He discovered a fire in the engine room and extinguished the flames with the on-board fire extinguishers. He returned to his home using the port-side engine. When the owner tried again to operate the boat in the water, the port-side engine emitted heavy black smoke. He had the vessel taken to a boatyard for inspection.
Expert analyses. According to the insurer’s expert, the impeller pump failed because of residual stresses accompanied with porosity and voids, which arose during manufacture. The insurer’s expert was not able to observe any direct evidence of residual stresses because that could only be seen with a "scientific type" of equipment, and the equipment he usually used did not work with rubber products. Although the expert identified voids and areas of porosity in some of the impeller blades, he stated that some would be acceptable but did not clarify the amount that would be acceptable. He also testified that he would expect a pump with weakened material to fracture at a different point than where it actually fractured. The manufacturer’s expert stated that voids or porosity are normal to the wear of a pump and that he found no defect where the crack had formed.
"Running dry." Additional experts testified for both parties as to the mechanics of the pump failure. The manufacturer’s experts asserted that a hull obstruction could have blocked seawater from entering, causing the pump to "run dry" and fail, and that it is an occurrence known in the marine pump industry. The insurer’s second expert observed water in the system, but the manufacturer’s expert stated that water could have entered when the vessel was operated in the water after the initial incident. The experts all agreed that if the pump had failed bit-by-bit, in contrast to an abrupt failure from "running dry," the blade’s fragments would have been found in the heat exchanger—but no such parts were found there. Instead, the majority of the fragments were on the filtered side of the sea strainer, which was consistent with "running dry."
The manufacturer’s experts offered reasoned explanations offsetting the conclusions of the insurer’s experts. The manufacturer’s experts stated that: there was no suction hose collapse as would be expected in a "run dry" event because the hose had been reinforced and designed to withstand the pump’s maximum suction; the hardness test results showed no heating up, which was consistent with the pump "running dry"; there was evidence of material flow on the pump blades supporting the conclusion that the pump burnt up from "running dry," which was not present on the other pump; the energy-dispersive spectroscopy (EDS) analysis used by the insurer’s expert was not a sound method because of the composition of the rubber; and the absence of direct evidence of an obstruction, which was true in the case at bar, was not remarkable because once the pump fails, so does the suction contributing to the blockage.
Negligence. Under admiralty law, the common law principles of negligence apply. Because the insurer did not proffer evidence of a duty or breach thereof, this claim against the manufacturer failed.
Strict liability. The court, applying admiralty law, held that the insurer did not satisfy the elements required for a strict liability claim of products liability against the manufacturer. First, the insurer did not provide adequate direct evidence of a defect. The insurer’s expert admitted that he did not have the proper equipment to evaluate the pump in addition to not having evidence of residual stresses in the pump. The court also found the manufacturer’s expert was more persuasive on the issue.
Second, the insurer did not eliminate all reasonable explanations for the pump failure, namely the possibility that the pump "ran dry." The court was largely persuaded by the manufacturer’s experts’ testimonies, holding that the presence of water in the vessel could be explained by the operation of the vessel after the incident, that the impeller fragments were found in the locations consistent with the pump "running dry," and that the manufacturer’s experts’ testimony as to the suction hose’s integrity and the hardness test results were credible. The court found the microscopic analysis of the blade fragments to be the most compelling evidence that the pump "ran dry," adding that the EDS analysis was not reliable and the lack of an obstructing object was not fatal to the "run dry" theory. Thus, there was not enough circumstantial evidence that the pump was defective.
Causation. Finally, the court held that the insurer failed to establish that the alleged defect caused the damage to the vessel. The court determined that the manufacturer did not waive the affirmative defense of a superseding cause. The court explained that had the seawater flow sensor been connected to the alarm buzzer, the owner would have been alerted to shut off the affected engine and prevented the failure and fire. The operating manual provided that the alarm buzzer should be checked each time the engine is started; thus, it was not foreseeable to the manufacturer that the vessel’s operator would not be able to easily hear the buzzer. Accordingly, even if the pump was defective, the insurer did not establish that the defect proximately caused the damage. Therefore, the manufacturer was entitled to judgment in its favor.
The case is No. 18-cv-80332-BLOOM/Reinhart.
Attorneys: Alvaro Luis Mejer (Mejer Law, P.A.) for National Union Fire Insurance Co. of Pittsburgh PA. John J. Haggerty (Fox Rothschild LLP) for SPX Flow US, LLC.
Companies: National Union Fire Insurance Co. of Pittsburgh PA; SPX Flow US, LLC
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