Kendall Dealership Holdings, LLC v. Warren Distribution, Inc.

WO IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ALASKA
KENDALL DEALERSHIP HOLDINGS, LLC, )
)
Plaintiff, )
)
vs. )
)
WARREN DISTRIBUTION, INC., a Nebraska )
Corporation, )
)
Defendant. )
_______________________________________)
)
WARREN DISTRIBUTION, INC., ) No. 3:18-cv-0146-HRH
)
Third Party Plaintiff, )
)
vs. )
)
ELECTRICAL COMPONENTS )
INTERNATIONAL, INC. and ELECTRICAL )
COMPONENTS CANADA, INC., )
)
Third Party Defendants. )
_______________________________________)
O R D E R
Motion for Summary Judgment
Defendant moves for summary judgment.1 Third-party defendants join in this
motion.2 Defendant’s motion is opposed.3 Oral argument was requested but is not deemed
necessary.
1Docket No. 43.
2Docket No. 46.
3Docket No. 47.
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Facts
Plaintiff is Kendall Dealership Holdings, LLC. Defendant is Warren Distribution, Inc.
Third-party defendants are Electrical Components International, Inc. (ECI) and Electrical
Components Canada, Inc. (ECC).
Plaintiff alleges that it has purchased engine block heaters from defendant since at
least 2014.4 Plaintiff alleges that the engine block heaters it purchased from defendant were
“identical to an engine block heater that is the subject of a safety recall in vehicles sold in
Canada by Toyota Canada.”5 Defendant contends that the engine block heaters that are the
subject of the recall were manufactured by ECC and are not the same engine block heaters
it sold to plaintiff.
Plaintiff alleges that the engine block heaters it purchased from defendant “were
improperly manufactured due to either [a] short circuit in the electrical cord of the engine
block heater and/or too much wattage produced by the engine block heaters.”6 Plaintiff
alleges that “[s]everal vehicles sold by Kendall with the engine block heaters installed have
caused a fire as a result of the improperly manufactured engine block heaters.”7
4Complaint at 2, ¶¶ 5-6, Exhibit A, Notice of Removal, Docket No. 1.
5Id. at 2, ¶ 9.
6Id. at 2, ¶ 11.
7Id. at 2, ¶ 13.
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On June 21, 2018, plaintiff commenced this action. Plaintiff asserts breach of
contract, UTPA, breach of the implied warranty of merchantability, and breach of the implied
warranty of fitness for a particular purpose claims against defendant.
On October 19, 2018, defendant filed a third-party complaint against ECC and ECI.
Defendant alleges that it “purchased Pyroil brand block heaters from ECI, which it then
resold to Kendall” and that “the Pyroil block heaters were manufactured by ECC.”8
Defendant alleges that “[i]f . . . the block heaters manufactured by ECC and sold by ECI are
found to be defective, Warren is entitled to be indemnified or reimbursed by them for any
damages or judgment it is required to pay Kendall.”9
Defendant now moves for summary judgment on all of plaintiff’s claims, arguing that
plaintiff has no evidence that the engine block heaters it purchased from defendant were
defective. Third-party defendants join in defendant’s motion.10
Discussion
Summary judgment is appropriate when there are no genuine issues of material fact
and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The
initial burden is on the moving party to show that there is an absence of genuine issues of
8Third Party Complaint at 3, ¶ 8, Docket No. 21.
9Id. at 3, ¶ 10.
10Third-party defendants do not argue that they are entitled to summary judgment on
Warren’s claims against them. Rather, they argue that Warren is entitled to summary
judgment on plaintiff’s claims against Warren.
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material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). If the moving party meets
its initial burden, then the non-moving party must set forth specific facts showing that there
is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).
In deciding a motion for summary judgment, the court views the evidence of the non-movant
in the light most favorable to that party, and all justifiable inferences are also to be drawn in
its favor. Id. at 255.
Defendant contends, and plaintiff does not dispute, that in order for plaintiff to prevail
on any of its claims it will have to prove that the engine block heaters that it purchased from
defendant were defective. But, defendant argues that plaintiff has no evidence that will
prove that the engine block heaters in question were defective.
First, defendant argues that plaintiff has no evidence that shows that the engine block
heaters it purchased were identical to the recalled Canadian block heaters. Defendant asked
plaintiff to “produce all documents showing that the engine block heater(s) at issue in this
case are identical to the engine block heater that was subject to the block heater recall
relating to Toyotas sold in Canada.”11 Plaintiff responded that “[d]ocuments responsive to
this request[] are not within the possession, custody, or control of [p]laintiff.”12 Because
11Kendall Dealership Holdings, LLC’s Responses to Defendant’s First Discovery
Requests at 8, Exhibit 1, Defendant Warren Distribution’s Motion for Summary Judgment
[etc.], Docket No. 43.
12Id.
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plaintiff produced no evidence in response to this interrogatory, defendant contends that
plaintiff has no evidence on this issue.
Plaintiff disagrees and cites to its responses to ECC & ECI’s first set of discovery
requests. Although “[a] plaintiff’s discovery responses generally are not proper ‘evidence’
to establish a genuine dispute of material fact[,]” they can be when they are “are verified,
signed under penalty of perjury and based in part on . . . personal knowledge.” Griffin v.
Johnson, Case No. 1:13–cv–01599–LJO–BAM (PC), 2017 WL 4012817, at *2 (E.D. Cal.
Sept. 11, 2017). Plaintiff’s responses were verified by Dave Blewett, plaintiff’s president,
and some of the statements in the responses are plainly based on Blewett’s personal
knowledge. Thus, the court can consider plaintiff’s discovery responses in determining
whether plaintiff has come forward with evidence to show that there are genuine issues of
material fact as to whether the engine block heaters were defective.
In its responses to ECI and ECC’s interrogatories, plaintiff states that “Jimmy
O’Connor, the National Accounts Manager with Warren Distribution, told Dave Blewett,
President of Kendall, that the engine block heaters sold to Kendall were the same engine
block heaters that were subject to the Canadian recall.”13 Plaintiff also states that “Dave
Blewett spoke with Jeff Harbaugh and Steve Haag with Toyota USA who spoke with
13Kendall Dealership Holdings, LLC’s Responses to Third Party Defendants’ First Set
of Discovery Responses [etc.] at 2, Exhibit A, Kendall Dealership Holdings, LLC’s
Opposition to Warren Distribution Inc.’s Motion for Summary Judgment [etc.], Docket No.
47.
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representatives of Toyota Canada, who confirmed the block heaters sold to Kendall were the
same block heaters as those subject to the Canadian recall.”14
Defendant argues that anything Blewett was told is inadmissible hearsay, but that is
not necessarily so. What O’Connor told Blewett could be an admission of a party opponent
and thus it would not be hearsay. FRE 801(d)(2). Plaintiff has come forward with sufficient
evidence to show that there are material questions of fact as to whether the engine block
heaters it purchased from defendant were the same as the ones that were subject to the
Canadian recall.
Defendant next argues that plaintiff has no evidence that the Canadian block heaters
that were recalled were actually defective. Defendant asked plaintiff to produce “all
documents showing that the engine block heater recalled by Toyota Canada in fact was
defective.”15 Plaintiff again responded that “[d]ocuments responsive to this request[] are not
within the possession, custody, or control of [p]laintiff.”16 Because plaintiff produced no
evidence in response to this interrogatory, defendant contends that plaintiff has no evidence
on this issue. Moreover, defendant offers evidence that it contends shows that there was no
defect with the Canadian engine block heaters. In an email, one of defendant’s employees
14Id.
15Kendall Dealership Holdings, LLC’s Responses to Defendant’s First Discovery
Requests at 8, Exhibit 1, Defendant Warren Distribution’s Motion for Summary Judgment
[etc.], Docket No. 43.
16Id.
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informed one of plaintiff’s employees that “the smoke issues that arose and resulted in the
Toyota Canada recall were not able to be recreated during months of testing between Toyota
and ECI.”17 Thus, defendant insists that plaintiff has no evidence that the Canadian block
heaters were in fact defective.
Plaintiff, however, argues that the notice of recall itself creates a question of fact as
to whether the Canadian block heaters were actually defective. The Canadian recall notice
states that “the electrical power cords on some dealer installed block heaters may have been
improperly manufactured, causing the wires to contact each other, resulting in a short
circuit.”18
Third-party defendants argue that the recall notice is not evidence that the Canadian
block heaters were defective because it does not state that it has been determined that the
block heaters were improperly manufactured. Rather, the recall notice only states that the
electrical cords on some vehicles may have been defective.
But the recall notice at least suggests that the Canadian engine block heaters were
defective. Plaintiff has come forward with sufficient evidence to create an issue of fact as
to whether the Canadian engine block heaters were actually defective.
17Exhibit 4 at 1, Defendant Warren Distribution’s Motion for Summary Judgment
[etc.] Docket No. 43.
18Exhibit D at 1, Kendall Dealership Holdings, LLC’s Opposition to Warren
Distribution Inc.’s Motion for Summary Judgment [etc.], Docket No. 47.
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Finally, defendant argues that plaintiff has no evidence as to any specific defect in the
block heaters it purchased from defendant. Defendant asked plaintiff to produce “all
documents relating to any investigation of defects to or testing you performed on (or had
performed on) block heaters for the period 2013 to present.”19 Plaintiff responded “[s]ee
attached[,]”20 but defendant argues that all plaintiff produced was a complaint from a
customer that his Toyota truck was “plugged into [the] block heater and exploded and burned
for [a] total loss.”21 But, defendant argues that plaintiff has not produced any evidence that
ties the fire to a defective block heater. The customer reported that he had previously
complained of “hot engine smells” and difficulties with the vehicle starting at 40 degrees.22
But, defendant argues that these problems do not necessarily suggest that there was a
problem with the block heater.
Plaintiff argues that it does have evidence that the block heaters it purchased from
defendant were defective and again cites to its responses to ECC & ECI’s first discovery
requests. In answer to an interrogatory, plaintiff identified nine vehicles “in which a block
19Kendall Dealership Holdings, LLC’s Responses to Defendant’s First Discovery
Rquests at 7, Exhibit 1, Defendant Warren Distribution’s Motion for Summary Judgment
[etc.], Docket No. 43.
20Id.
21Exhibit 2 at 4, Defendant Warren Distribution’s Motion for Summary Judgment
[etc.] Docket No. 43.
22Id.
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engine hea[ter] cord melted or was physically damaged. . . .”23 Plaintiff argues that this is
sufficient evidence to create an issue of fact as to whether the block heaters it purchased from
defendant were defective.
Defendant argues that this list of nine vehicles is not sufficient to create an issue of
fact because it is not clear that the engine block heater was the cause of the cord melting or
being physically damaged. Defendant also argues that the number of vehicles is too small
to suggest that there was any kind of defect. Defendant suggests that it is just as likely that
the cause of the problem was that plaintiff had installed the engine block heaters incorrectly.
Third-party defendants, for their part, offer a report done by an insurance investigator on one
of the nine vehicles, in which the investigator stated that he “could not find a[ny] specific
evidence that would indicate the block heater or the installation by the dealer certainly or
potentially caused or contributed to a fire in the engine compartment.”24 Thus, third-party
defendants argue that plaintiff’s contention that it has evidence showing that the engine block
heaters installed in the nine vehicles were defective is questionable.
While the report offered by the third-party defendants does suggest that plaintiff’s
evidence of actual defects might not be as robust as plaintiff made out, the fact remains that
plaintiff has come forward with evidence that there were eight other vehicles that had engine
23Kendall Dealership Holdings, LLC’s Responses to Third Party Defendants’ First Set
of Discovery Requests [etc.] at 5, Exhibit A, Kendall Dealership Holdings, LLC’s Opposition
to Warren Distribution Inc.’s Motion for Summary Judgment [etc.], Docket No. 47.
24Shideh Engineering Report at KDH 005455, Exhibit 1, Memorandum in Reply to
Motion for Summary Judgment, Docket No. 49.
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block heaters installed and that either caught fire or the cord on the heater melted.
Circumstantial evidence is sufficient to prove a defect. Alaska Rent-A-Car, Inc. v. Ford
Motor Co., 526 P.2d 1136, 1141 (Alaska 1974). Plaintiff has come forward with sufficient
circumstantial evidence to survive defendant’s motion for summary judgment.
Conclusion
Plaintiff’s request25 for oral argument is denied. Defendant’s motion for summary
judgment26 is denied.27
DATED at Anchorage, Alaska, this 12th day of August, 2019.
/s/ H. Russel Holland
United States District Judge
25Docket No. 50.
26Docket No. 43.
27Because defendant’s motion for summary judgment is denied, the court need not
consider plaintiff’s request for a 180-day continuance pursuant to Rule 56(d), Federal Rules
of Civil Procedure.
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