August 13, 2013
ROCKY STAYTON, Plaintiff,
CLARIANT CORPORATION, Defendant.
Submitted: April 1, 2013
Upon Defendant's Motion for Summary Judgment.
William D. Fletcher, Esquire of Schmittinger and Rodriguez, P.A., Dover, Delaware; attorney for the Plaintiff.
Kevin J. Connors, Esquire of Marshall Dennehey Warner Coleman & Goggin, Wilmington, Delaware; attorney for Defendant.
Defendant Clariant Corporation ("Clariant") filed this Motion for Summary Judgment on February 25, 2013. Plaintiff Rocky Stayton ("Plaintiff") filed a memorandum in opposition on March 18, 2013. Based upon the reasons set forth below, Clariant's Motion for Summary Judgment must be granted.
II. Relevant Factual and Procedural Background
Although this case has a protracted procedural history, the salient facts of Plaintiff's injury are not in dispute and can be succinctly recited. On May 20, 2003, Plaintiff, an employee of Clariant, was injured when a four-wheeled pelletizer machine ("Pelletizer No. 10") weighing nearly 1700 pounds toppled over on him while being moved. The accident was allegedly due to defects in the floor and the top-heavy nature of the machine. Stayton suffered injuries to his left leg and hand, and underwent numerous surgeries as a result of the accident.
The chain of ownership of Pelletizer No. 10 is as follows. The original owner of Pelletizer No. 10 was American Enka Corp. ("Enka"), who purchased the machine in 1961 from its manufacturer, Cumberland Engineering Co. At some point after 1970, Plastic Materials Co., Inc. ("Plastic Materials") purchased Pelletizer No. 10 and used the machine in the same manufacturing facilities where Stayton was injured. In May 1996, PMC Acquisition Co., Inc. ("PMC Acquisition"), purchased the business assets of Plastic Materials. Pelletizer No. 10 was among those assets purchased by PMC Acquisition. On December 20, 1996, PMC Acquisition merged with Polymer Color North America, Inc. ("Polymer Color"). Pursuant to the merger agreement, Polymer Color was the surviving corporation. On December 31, 1997, Polymer Color, a Delaware corporation, merged with Clariant, a New York corporation. Clariant was the surviving corporation. In 1999, Stayton began his employment with Clariant.
Pelletizer No. 10 was manufactured in 1961 by Cumberland Engineering Company, Inc. ("Cumberland"). Cumberland designed and manufactured the model with two swivel casters and two fixed casters, as the machine was designed to be moved short distances. Pelletizer No. 10 was furnished with V-grooved track casters for use with a floor-mounted track system. It was intended to be moved only along its long axis. At some point between 1961 and the day of Plaintiff's injury, Pelletizer No. 10's fixed casters were replaced with two swivel casters of differing sizes. Both parties' respective engineering experts agree that this modification decreased Pelletizer No. 10's stability and made it more prone to tip over.
Plaintiff, even after extensive discovery, has failed to uncover which corporation was responsible for the alleged modifications. Few maintenance records were kept, and the first date of entry in the machine's maintenance log was not made until 1984. It is not even clear from the record just when and from whom Plastic Materials purchased Pelletizer No. 10. There is no evidence of what changes, if any, were made to Pelletizer No. 10's base and wheel structure between 1961, when the machine was purchased by Enka, and 1970, when Joseph Warnell ("Warnell"), Plastic Materials' owner, purchased it from Enka. Plaintiff deposed several Plastic Materials employees and managers, but they all testified that they had no recollection of any modifications made to the pelletizer's wheel or base during Plastic Materials' ownership of the machine. The record reveals no evidence that the pelletizer was modified between the time that Clariant acquired the machine on December 31, 1997, and Plaintiff's accident on May 20, 2003. Moreover, the record is wholly silent as to whether the pelletizer was modified during the 19-month period that PMC Acquisition and Polymer Color owned the machine.
Plaintiff filed his original complaint in this action on May 19, 2005, naming, among other defendants, Polymer Color, PMC Acquisition, and Plastic Materials.Clariant was joined as a third-party defendant by Mill Pond Properties, Inc. ("Mill Pond"), owner of the premises where the accident occurred. Plaintiff then moved to amend the original complaint to add Clariant as a direct defendant, which Clariant opposed. Plaintiff was granted leave to amend his complaint on the basis that amendments to complaints are liberally granted.
Plaintiff thereafter filed an Amended Complaint containing a new Count IV, which alleged that Polymer Color, by virtue of its purported merger with PMC Acquisition, assumed statutory liability for PMC Acquisition's alleged negligent maintenance, alteration or modification of the pelletizer. The same count also alleged that Clariant, by virtue of its merger with Polymer Color, assumed statutory liability for the alleged negligence of its predecessors, including Polymer Color. In April of 2008, Clariant and Polymer Color filed motions to dismiss Plaintiff's Complaint and Amended Complaint. In an order issued on August 29, 2008, the Court granted both motions to dismiss on the basis that the claims against Polymer Color and Clariant were barred by the exclusivity provision of the Worker's Compensation Act. Plaintiff timely filed a motion for Reargument of the Court's August 29, 2008 order, pursuant to Superior Court Civil Rule 59(e). The Court denied Plaintiff's Motion for Reargument on December 30, 2008. Plaintiff then appealed both orders to the Delaware Supreme Court.
The Delaware Supreme Court issued an opinion on December 13, 2010, reversing this Court's order dismissing Plaintiff's Amended Complaint against Clariant. The Supreme Court held that the Workers' Compensation Act's exclusivity provision did not bar Plaintiff's claim against Clariant because Clariant was acting as a second persona unrelated to its status as Plaintiff's employer when it assumed the liabilities and obligations of Polymer Color through the merger of the two corporations. In so holding, the Supreme Court stated that ". . . it is unnecessary for this Court to consider the merits of other issues raised, such as whether Polymer Color owed any duty to Stayton or whether Stayton's claim is barred by the statute of limitations. Those matters will be decided in the proceedings upon remand."
In considering the present motion, the Court must now determine (1) the extent of Clariant's liabilites as a successor-in-interest to the alleged third-party tortfeasor, and (2) whether Plaintiff has presented enough evidence to establish a prima facie case of negligence.
III. Standard of Review
Summary Judgment should be granted only if the record shows that there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. The facts must be viewed in the light most favorable to the non- moving party. Summary Judgment may not be granted if the record indicates that a material fact is in dispute, or if it seems desirable to inquire more thoroughly into the facts in order to clarify the application of the law to the circumstances. However, when the facts permit a reasonable person to draw but one inference, the question becomes one for decision as a matter of law.
IV. Parties' Contentions
Defendant contends that Clariant's liability is limited to any torts allegedly committed by Clariant itself because all of the potential tortfeasors have been dismissed from the action. Without an original tortfeasor, Defendant argues, there can be no successive liability. Defendant also contends that it is entitled to summary judgment because Plaintiff has presented no evidence which supports his allegations that either Polymer Color or one of its predecessors negligently maintained, altered, or modified the pelletizer in question, and that this negligence was the proximate cause of Plaintiff's injury.
In opposition, Plaintiff argues that there was no basis to appeal those allegations against Polymer Color and its corporate predecessors because they were no longer legally existing corporations at the time of Plaintiff's accident. Plaintiff contends that Clariant assumed the liabilities of Polymer Color, PMC Acquisition, and Plastic Materials when it merged with Polymer Color in December of 1997. Therefore, Count IV of Plaintiff's Amended Complaint is still viable as Plaintiff timely sued and served Clariant, the successor entity. Finally, Plaintiff contends that he has offered sufficient factual support from which a jury could deduce that either PMC Acquisition or Polymer Color was the original tortfeasor.
The sole claim remaining in this case is found in Count IV of Plaintiff's Amended Complaint. That Count alleges negligence claims against both Polymer Color and its successor corporation, Clariant. Specifically, Count IV charges Polymer Color and Clariant with assuming liability for their respective corporate prede cesso rs's alleged negligent maintenance, alteration or modification of Pelletizer No. 10 by virtue of their mergers with PMC Acquisition and Polymer Color, respectively. Clariant has now moved for summary judgment as to Count IV of Plaintiff's Amended Complaint.
A. Plaintiff's Negligence Claim Against Polymer Color
As a prefatory matter, the Court must clarify the status of Plaintiff's negligence claim against Polymer Color as the surviving corporation in its merger with PMC Acquisition, an alleged third-party tortfeasor. Plaintiff's negligence claim against Polymer Color was dismissed by this Court's order dated August 28, 2009. Plaintiff chose not to appeal the portion of this order dismissing all claims against Polymer Color, and thus, the order was a final adjudication of Plaintiff's claim against Polymer Color as a corporate successor. In their briefs, the parties quibble whether this dismissal was made with or without prejudice, but defense counsel seemingly misappreciates that Plaintiff needs not perfect service on or even name the original tortfeasor in his suit in order to hold Clariant liable as a corporate successor.Polymer Color dissolved in December of 1997 by virtue of its merger with Clariant, and Clariant, the surviving entity, assumed Polymer Colo r's liabilities and obligations by statute. It follows then that any claim against Polymer Color as the surviving corporation in its merger with PMC Acquisition must be directed at Clariant, who assumed Polymer Color's liabilities and obligations as its successor-by-merger.
B. The Extent of Clariant's Successor Liability
The Court must next determine whether Clariant is liable, under the dual persona doctrine, for any tortious conduct allegedly committed by PMC Acquisition or Plastic Materials. The dual persona doctrine, a narrow exception to the exclusivity provision of Delaware's Workers' Compensation Act, recognizes that an injured employee may sue his employer in tort when that employer is the corporate successor of a third-party tortfeasor. Undoubtedly, Clariant expressly assumed all of Polymer Color's liabilities and obligations when the two corporations merged. What is less clear is whether those liabilities include any tort allegedly committed by PMC Acquisition, Plastic Materials, or their respective employees.
After a review of the exhibits attached to Plaintiff's opposition memorandum, it is clear that Clariant assumed the liabilities of PMC Acquisition, but not Plastic Materials, when it merged with Polymer Color. Warnell sold the assets of Plastic Materials to PMC Acquisition on May 10, 1996. The asset purchase agreement expressly disclaims "all liabilities and obligations of Seller, except as specifically assumed by Buyer in the agreement." Gene rall y, a corporation that merely purchases the assets of another corporation is not liable for the seller's debts and liabilities. An exception is made to this rule in four instances, specifically, if (1) [the successor corporation] expressly or impliedly assumed the predecessor's tort liability, (2) there was a consolidation or merger of seller and purchaser, (3) the purchasing corporation was a mere continuation of the selling corporation, or (4) the transaction is entered into fraudulently to escape such obligations. Plaintiff has not shown that any of these exceptions apply. Therefore, Clariant cannot be held liable for Plastic Materials' allegedly tortious acts.
However, assuming arguendo that Plaintiff can show that PMC Acquisition was the original tortfeasor, Clariant can be held liable as a successor-in-interest. Polymer Color, a Delaware corporation, entered into a valid merger with PMC Acquisition, a Delaware corporation, on December 20, 1996. Therefore, pursuant to 8 Del. § 259, Polymer Color, the surviving corporation, "assumed all debts, liabilities, and duties" of PMC Acquisition. Clariant assumed the liabilities of both Polymer Color and PMC Acquisition when it merged with Polymer Color in December 1997.
C. Plaintiff's Negligence Claim Against Clariant
Count IV of Plaintiff's Amended Complaint advances two theories of liability. The first theory is that Clariant is liable as a successor for the negligent modification of Pelletizer No. 10. The second theory alleges that Clariant is liable as a successor for its predecessors-in-interest's failure to inspect Pelletizer No. 10 to ascertain whether the machine was inherently unstable or prone to tip.
Generally, negligence cases are not susceptible to summary judgment.However, if a plaintiff cannot prove the essential elements of his case against a defendant, then summary judgment is appropriate. To state a prima facie claim for negligence, a plaintiff must establish that (1) defendant owed plaintiff a duty of care; (2) defendant breached that duty; (3) defendant's breach was the proximate cause of plaintiff's injury; and (4) plaintiff incurred damages as a result of the defendant's breach.
Viewing the evidence and all reasonable inferences that can be drawn therefrom in a light most favorable to Plaintiff, as the non-moving party, the Court concludes that Plaintiff failed to present sufficient evidence to support a prima facie negligence claim against Clariant under either theory of liability. Accordingly, Clariant is entitled to summary judgment on Count IV.
i. Negligent Modification
As noted at the outset of this section, on a motion for summary judgment, the Court will draw all reasonable inferences in favor of the nonmoving party. However, a party opposing a motion for summary judgment must present more than mere conjecture and speculation to provide a basis upon which to deny the motion. Plaintiff's contention that Clariant or one of its predecessors for whom Clariant assumed liabilities modified the pelletizer's wheels or casters appears to be nothing more than speculation.
Plaintiff contends that the jury can deduce, from the evidence presented, that the caster modifications were made during the periods in which PMC Acquisition or Polymer Color exercised ownership over Pelletizer No. 10, but Plaintiff has submitted no evidence or affidavits to support that the alleged caster changes were made during either entity's tenure. PMC Acquisition and Polymer Color owned Pelletizer No. 10 during a 19-month period which began on May 10, 1996 and ended on December 31, 1997, when Polymer Color merged with Clariant. Upon a review the record, I find no evidence that either PMC Acquisition or Polymer Color replaced the casters or otherwise modified the pelletizer during this period. In fact, Craig Clauser, Plaintiff's own expert, testified that he could not decipher which entity allegedly modified Pelletizer No. 10 in a way that would have reduced its stability.
Moreover, Plaintiff has presented no evidence to confirm (1) whether Enka made the alleged caster changes before it sold Pelletizer No. 10 to Plastic Materials, (2) what happened to the pelletizer between the date of its sale to Enka in 1961 and 1970, when Warnell founded Plastic Materials, and whether any unknown intervening owner changed the casters; and (3) just when Plastic Materials purchased Pelletizer No. 10. The earliest entry listed in Pelletizer No. 10's maintenance log is dated 1984. Plaintiff cannot eliminate the period between 1961 and 1984 as the time period during which the caster changes were allegedly made. Plaintiff's assertion that either PMC Acquisition or Polymer Color is the original tortfeasor is unsupported. Accordingly, Clariant's motion for summary judgment must be granted insofar as Count IV seeks to recover damages based upon a theory of negligent modification.
ii. Failure to Inspect
Count IV also asserts that Clariant is liable for its predecessors' failure to inspect Pelletizer No. 10. Plaintiff posits in his summary judgment motion that there was ample opportunity for PMC Acquisition and Polymer Color to inspect, identify and correct Pelletizer No. 10's instability. Clariant contends that it is entitled to summary judgment on this theory of liability because Plaintiff has not introduced expert testimony to show that Clariant's predecessors' failure to inspect Pelletizer No. 10 for a dangerous condition fell below the appropriate standard of care.
Expert testimony is required to establish the standard of care applicable to an inspection of the pelletizer in question because laypersons are not familiar with the frequency, methods, and requirements for conducting inspections of pelletizers. This Court previously determined that Clauser is not qualified as an expert in industrial safety. Plaintiff has identified no other expert qualified to opine that the alleged failure of Clariant or its predecessors in interest to inspect the pelletizer for dangerous modifications was a deviation from the standard of care. Therefore, Clariant is entitled to summary judgment on this theory of liability.
In sum, there is no evidence from which a person could reasonably infer that Clariant is legally responsible, by way of its merger with Polymer Color, for the purported tortious conduct of PMC Acquisition and Polymer Color. There is simply a dearth of evidence from which a jury could infer that PMC Acquisition or Polymer Color negligently modified or maintained Pelletizer No. 10. Accordingly, Clariant's Motion for Summary Judgment must be granted.
For the foregoing reasons, Defendant's Motion for Summary Judgment is GRANTED.
IT IS SO ORDERED.