By David Yucht, J.D.
There were no allegations that the manufacturers owed the property owner a duty of care or that any such duty was breached. Consequently, negligence claims were dismissed.
A federal district court in Connecticut dismissed negligence and express warranty claims filed against manufacturers of a furnace and a furnace blower motor brought by an insurance company as subrogee of a property owner whose building was damaged by a fire which allegedly started in the furnace. The court, however, found that the insurance company’s strict liability claims for design defect, manufacturing defect, and failure to warn were plausibly pleaded. Consequently, the court declined to dismiss the strict liability claims (Philadelphia Indemnity Ins. Co. v. Lennox Industries, Inc., February 12, 2020, Haight, C.).
Lennox Industries, Inc. designs, manufactures, and distributes furnaces; and Nidec Motor Corporation designs, manufactures, and distributes blower motors for furnaces. Almost Home Day Care, LLC purchased a building that contained a Lennox furnace with a Nidec blower motor. A fire allegedly started in the furnace originating in the blower motor. The fire caused substantial damage throughout the property. Philadelphia Indemnity Insurance Company, the insurer of Almost Home’s property at issue, brought a subrogation suit against Lennox and Nidec alleging that the fire was caused by a defective manufacture and/or design of the furnace and blower motor. Specifically, the insurer alleged that because of defective manufacture and design, the furnace and the blower motor were unable to compensate for foreseeable airflow restrictions, causing overheating, arcing, and failure of the furnace blower motor’s internal windings. Lennox also claimed that there was repeated cycling and failure of the blower motor’s thermal cut off switch. The insurance company asserted claims under the Connecticut Product Liability Act (CPLA), which is the "exclusive remedy" for products liability claims under Connecticut law, alleging strict product liability—for design defect, manufacturing defect, and failure to warn—as well as negligence and breach of warranty. The manufacturers moved to dismiss all claims.
Design defect. The court found that the complaint contained allegations that raised a reasonable inference that the products were defective in their design. Specifically, because of defective manufacture and design, the furnace and the blower motor were unable to compensate for foreseeable airflow restrictions, causing overheating, arcing and failure of the furnace blower motor’s internal windings. It was also asserted that there was repeated cycling and failure of the blower motor’s thermal cut off switch. These allegations linked the specific components and mechanisms of the products to a clearly defined problem that rendered their design defective. The court disagreed with Lennox’s argument that the allegations pointed solely to Nedic’s blower motor. Although Lennox was not involved in the design or manufacture of the blower motor, Lennox still had a duty to design its furnace in a manner that would account for any "foreseeable and anticipated restrictions of airflow" that might negatively impact the operation of the furnace, including the blower motor.
Manufacturing defect. The court also determined that the complaint contained sufficient allegations to sustain claims of a manufacturing defect. The insurance company alleged that the furnace and the blower motor were defective in their manufacture because they were unable to "compensate for foreseeable and anticipated restrictions of airflow" and prevent "overheating, arcing and failure of the furnace blower motor’s internal windings." Moreover, it alleged that the defective condition of the products resulted from failure to comply with relevant regulations and standards. Although these allegations did not identify the specific manufacturing specifications that were disregarded, they were adequate, at a preliminary stage in the litigation, to show that the products suffered from a manufacturing defect.
Failure to warn. The court additionally ruled that the failure to warn claims contained enough factual content to survive the motions to dismiss. The court noted that detailed allegations concerning the exact instructions that should have been provided were not required to plausibly state a failure to warn claim. Here, the complaint alleged that the fire was caused by the manufacturers’ failure to warn users of the unreasonably dangerous risk of fire based on the propensities of the furnace and blower motor to overheat during foreseeable use because of, among other things, restricted airflow.
Negligence. The court dismissed the insurance company’s negligence claims. The court found that the complaint did not allege any specific content to support an inference of negligence. Unlike strict liability, which "focuses on the product itself" and finds the manufacturer liable if the product is defective, negligence centers on the manufacturer’s conduct. Here, there were no allegations in the complaint alleging that the manufacturers owed a duty of care to Almost Home. Moreover, the insurance company did not plead any facts suggesting that the manufacturers breached any duty by acts or omissions causing their products to be defective.
Other issues. The insurance company failed to state a claim for breach of express warranty because it did not plead factual content identifying any representation, affirmation of fact, promise, or statement made and breached by either manufacturer. However, the court ruled that it plausibly alleged that the manufacturers breached an implied warranty of merchantability when they sold the furnace and the blower motor in a defective and not merchantable condition. Because the insurer had plausibly stated a claim against both manufacturers for design and manufacturing defects, the court found it had established sufficiently that the products were defective and not merchantable for the purposes of its breach of implied warranty claims. Further, the court held that the insurer plausibly alleged that the manufacturers also breached an implied warranty of fitness for a particular purpose because Lennox and Nidec had reason to know of the intended purpose of the furnace and the blower motor, yet failed to design or manufacture the products in a way that would be safe to operate. In addition, Almost Home claimed that it actually relied on the manufacturers, expecting their products to be "free of defects" and to "operate in an ordinary and foreseeable manner."
Finally, the court refused to allow the insurance company to amend its complaint to correct the deficiencies in its negligence and express warranty claims. The court noted that this complaint had already been amended four times and allowing a further amendment would be futile and result in unnecessary motion practice.
The case is No. 3:18-cv-00217-CSH.
Attorneys: Mark D. O'Hara (Law Offices of Stuart G. Blackburn LLC) for Philadelphia Indemnity Ins. Co. Bryan J. Haas (Howd & Ludorf LLC) for Lennox Industries, Inc. Peter T. Fay (Neubert Pepe & Monteith PC) for NIDEC Motor Corp.
Companies: Philadelphia Indemnity Ins. Co.; Lennox Industries, Inc.; NIDEC Motor Corp.
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