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LLC v. Dassault Falcon Jet-Wilmington Corp.

United States District Court, D. Delaware

January 27, 2017

33 IDC, LLC and SALTCHUK RESOURCES, INC., Plaintiffs,
v.
DASSAULT FALCON JET -WILMINGTON CORP., a Delaware Corporation, Defendant.

          MEMORANDUM ORDER

          HON. LEONARD P. STARK, UNITED STATES DISTRICT COURT JUDGE

         At Wilmington this 27th day of January, 2017, having reviewed the parties' briefing (D.I. 16, 19, 20, 21, 23, 24) and related filings regarding Plaintiffs 331DC, LLC ("331DC") and Saltchuk Resources, Inc.'s ("Saltchuk") Motion for Partial Summary Judgment (D.I. 15) ("Plaintiffs' Motion") and Defendant Dassault Falcon Jet - Wilmington Corp.'s Motion for Summary Judgment or Partial Summary Judgment (D.I. 18) ("Defendant's Motion"), and having heard oral argument, IT IS HEREBY ORDERED that, for the reasons below, Plaintiffs' Motion (D.I. 15) is GRANTED and Defendant's Motion (D.I. 18) is GRANTED IN PART and DENIED IN PART.

         I. BACKGROUND

         Plaintiffs filed this action in diversity under 28 U.S.C. § 1332 to recover damages allegedly caused by Defendant's negligent handling of an aircraft leased by Plaintiffs. (See D.I. 1 ¶¶ 5, 13-15) The parties stipulated to certain facts relevant to their disputes. (See D.I. 9)("Stipulation") The facts recited herein are taken from the parties' Stipulation, unless otherwise noted.

         33 IDC leased a 2008 Falcon Model 2000DX aircraft ("Aircraft") from GC Air, LLC ("GC Air") pursuant to an Aircraft Lease Agreement dated March 7, 2008.[1] (D.I. 9 ¶ 4) The Aircraft, a twin-engine transcontinental business jet, was manufactured by Dassault Aviation. (Id:¶ 6) By a Transfer and Assumption Agreement dated July 11, 201.1, 331DC and Saltchuk became co-lessees of the Aircraft.[2] (Id.¶ 5) Saltchuk is the sole, and managing, member of 331DC. (Id.¶ 3)

         Defendant operates a service center for Falcon business jets at the New Castle County Airport in Delaware ("Dassault Aircraft Services"). (Id. ¶ 8) The Dassault Aviation-owned facility offers aircraft on-ground services, scheduled and unscheduled maintenance, complete interior refurbishment, avionics retrofits, strip and paint, structural repairs, and on-site engine maintenance. (Id.)

         During the fourth quarter of 2012, Saltchuk scheduled the Aircraft for maintenance and repairs at Dassault Aircraft Services pursuant to an Aircraft Work Proposal and Agreement between Saltchuk and Defendant ("Proposal").[3] (Id. ¶ 9) Saltchuk's authorized agent accepted and agreed to the Proposal. (Id.)

         Saltchuk presented the Aircraft to Defendant at Dassault Aircraft Services on January 14, 2013 for the maintenance and repair work to be performed by Defendant. (Id. ¶ 10) At that time, Saltchuk's authorized agent executed an Aircraft Work Authorization ("Authorization").[4] (Id.) The Court will refer to the Proposal and Authorization collectively as the "Contract." Defendant stored the Aircraft at Dassault Aircraft Services until maintenance and repair work could be completed. (Id. ¶ 11) Accordingly, Defendant had possession of the Aircraft up to and including February 24, 2013. (Id.)

         A portion of the maintenance and repair work involved partial removal of the Aircraft's interior. (Id. ¶ 12) To compensate for the impact that the partial interior removal had on the Aircraft's center of gravity, Defendant's personnel placed 600 pounds of ballast - in the form of lead plates and modified barbell weights - on boards inside the cabin. (Id.) With the ballast weights in place, the Aircraft was within the empty weight and balance envelope as specified in the Aircraft's loading manual. (Id.)

         On the afternoon of February 24, 2013, the Aircraft was located in Hangar 3B. (Id. ¶ 13) Defendant moved the Aircraft out of Hangar 3B to facilitate moving other aircraft out of the hangar. (Id.) After towing the Aircraft out of Hangar 3 B, Defendant left the Aircraft on a ramp outside of Hangar 3B. (Id. ¶ 14) Approximately 20 minutes after being parked on the ramp, the Aircraft's nose lifted off the ground, and the Aircraft tipped back on its main gears, causing the aft fuselage to come in contact with the ground (the "Incident"). (Id. ¶ 15) At the time of the Incident, winds at the New Castle County Airport were at 21.9 miles per hour and gusting to 31.1 miles per hour. (Id. ¶ 16) The ramp on which the Aircraft was parked sloped downward relative to the longitudinal axis of the Aircraft, increasing the angle of attack of the wing of the Aircraft and thereby increasing lift. (Id.)

         As a result of the Incident and the Aircraft's impacting the ground, the Aircraft sustained internal and external damage, including damage to fuselage skins and to the Aircraft's frame. (Id. ¶ 17) In addition, aft bulkhead interior panels sustained damage when the ballast weight that had been placed inside the Aircraft slid aft as the Aircraft tipped back. (Id.)

         Defendant repaired the damage - at Defendant's expense and to Saltchuk's satisfaction -that had been caused during the Incident. (Id. ¶ 18) The repairs were completed on September 22, 2013. (Id.) Defendant remained in possession of the Aircraft from the date of the Incident, on February 24, 2013, through completion of the Aircraft's repair, on September 22, 2013 (the "Repair Period"). (Id.) During the Repair Period, Plaintiffs were not able to use the Aircraft. (Id. ¶ 22)

         Saltchuk and Defendant entered into a tolling agreement on February 20, 2015 to toll the applicable statute of limitations for claims relating to Defendant's alleged tort liability. (See generally D.I. 20-1 Ex. A)

         Plaintiffs sued Defendant on December 29, 2015, alleging "breach of bailment" under a negligence theory. (D.I. 1 ¶¶ 13-15)[5] Plaintiffs seek loss-of-use damages in the form of "more than $1.1 million in lease payments for the Aircraft and roughly $500, 000 in additional damages proximately caused by Defendant's negligence." (D.I. 16 at 1) Plaintiffs do not seek damages for diminution in value of the Aircraft. (D.I. 9 ¶ 22) Plaintiffs pleaded recovery of attorney fees and costs (D.I. 1 at 5) but now acknowledge that "they are not entitled to recover attorney fees at this stage of the case" (D.I. 20 at 12 n.2).

         Defendant answered the complaint on January 20, 2016. (D.I. 5) Defendant argues that Plaintiffs are not entitled to any relief in light of (1) provisions in the Contract barring recovery of damages sought by Plaintiffs; (2) Plaintiffs' failure to show breach of bailment; (3) the economic loss doctrine; (4) Delaware's statute of limitations for tort liability; and (5) Plaintiffs' failure to allege damages that are compensable under Delaware law. (See generally D.I. 19)

         The parties completed briefing on their motions on August 26, 2016. (D.I. 16, 19, 20, 21, 23, 24) The Court heard oral argument on October 25, 2016. (See Transcript ("Tr."))

         II. LEGAL STANDARDS

         Pursuant to Rule 56(a) of the Federal Rules of Civil Procedure, "[t]he court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." The moving party bears the burden of demonstrating the absence of a genuine issue of material fact. See Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 585-86 (1986). An assertion that a fact cannot be - or, * alternatively, is - genuinely disputed must be supported either by citing to "particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials, " or by "showing that the materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact." Fed.R.Civ.P. 56(c)(1)(A) & (B). If the moving party has carried its burden, the nonmovant must then "come forward with specific facts showing that there is a genuine issue for trial." Matsushita, 475 U.S. at 587 (internal quotation marks omitted). The Court will "draw all reasonable inferences in favor of the nonmoving party, and it may not make credibility determinations or weigh the evidence." Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000).

         To defeat a motion for summary judgment, the nonmoving party must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita, 475 U.S. at 586; see also Podobnikv. U.S. Postal Sen?., 409 F.3d 584, 594 (3d Cir. 2005) (stating party opposing summary judgment "must present more than just bare assertions, conclusory allegations or suspicions to show the existence of a genuine issue") (internal quotation marks omitted). The "mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment;" a factual dispute is genuine only where "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). "If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Id. at 249-50 (internal citations omitted); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) (stating entry of summary judgment is mandated "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial"). Thus, the "mere existence of a scintilla of evidence" in support of the nonmoving party's position is insufficient to defeat a motion for summary judgment; there must be "evidence on which the jury could reasonably find" for the nonmoving party. Anderson, 477 U.S. at 252.

         III. DISCUSSION

         A. Choice of Law

         The parties appear to agree that Delaware law governs the issues addressed in their Motions. (See D.I. 16 at 6; D.I. 19 at 1-2) "'The conflict of laws rules to be applied by the federal court in Delaware must conform to those prevailing in Delaware's state courts.'" Under hill Inv. Corp. v. Fixed Income Disc. Advisory Co., 319 F.App'x 137, 140 (3d Cir. 2009) (quoting Klaxon Co. v. Stentor Elec. Mfg. Co.,313 U.S. 487, 496 (1941)). Under Delaware law, "where the parties agree to a choice-of-law provision to govern their contractual rights and duties, that choice should be enforced." Id. at 141 (internal quotation marks omitted). The ...


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