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SILIVANCH v. CELEBRITY CRUISES
September 28, 2001
JOHN AND JOYCE SILIVANCH, PLAINTIFFS,
CELEBRITY CRUISES, INC., FANTASIA CRUISING INC., ESSEF CORP., PAC-FAB, INC., AND STRUCTURAL EUROPE, N.V. (F/N/A SFC), DEFENDANTS. CELEBRITY CRUISES, INC. AND FANTASIA CRUISING INC., THIRD-PARTY PLAINTIFFS, V. STRUCTURAL EUROPE, ESSEF CORP., AND PAC-FAB, INC., THIRD-PARTY DEFENDANTS.
The opinion of the court was delivered by: Francis, United States Magistrate Judge.
In July 1994, there was an outbreak of Legionnaires' Disease,
a form of pneumonia, among passengers who had disembarked from
the cruise ship Horizon after a voyage to Bermuda. An
investigation by the United States Centers for Disease Control
and Prevention revealed the presence of Legionella bacteria in
the filters of the ship's whirlpool spa. Many of the victims
(collectively, the "Passenger Plaintiffs") brought suit against
Celebrity Cruises Inc. and Fantasia Cruising Inc. (collectively,
"Celebrity"), the owners and operators of the Horizon. They also
sued Essef Corporation, Pac-Fab, Inc., and Structural Europe,
N.V. (collectively, the "Essef Defendants"), affiliated
companies that had designed, manufactured, and distributed the
filters. In addition, Celebrity filed a complaint and
cross-claims against the Essef Defendants seeking
indemnification and contribution and also seeking damages for
products liability, breach of warranty, fraud, and negligent
The cases were consolidated for discovery, and the parties
consented to refer each action to me for all purposes including
trial pursuant to 28 U.S.C. § 636(c). The parties also
stipulated that the Silivanch action would be tried as a
bellwether case and would result in a determination of the
liability of Celebrity and the Essef Defendants to the Passenger
Plaintiffs, an allocation of responsibility among the
defendants, a determination of the Essef Defendants' liability
on Celebrity's claims, and an assessment of any punitive
damages. The parties also agreed that the jury in the bellwether
case would award compensatory damages to the Silivanch
plaintiffs, but that separate compensatory damage trials would
be held with respect to the remaining plaintiffs and with
respect to Celebrity's claims against the Essef Defendants.
After receiving evidence over a period of six weeks in the
Silivanch case, the jury rendered its verdict. It found
Celebrity liable to the Passenger Plaintiffs for negligence and
the Essef Defendants liable to these plaintiffs for negligence
and strict products liability, as well as breach of express and
implied warranties. Further, the jury held the Essef Defendants
liable to Celebrity for fraud, negligence, strict products
liability, breach of express and implied warranties, and
negligent misrepresentation. The jury allocated thirty percent
of the responsibility for the Passenger Plaintiffs' injuries to
Celebrity and seventy percent to the Essef Defendants. It also
held the Essef Defendants liable both to the Passenger
Plaintiffs and to Celebrity for punitive damages.
Thereafter, the jury calculated the amount of damages to be
found the Essef Defendants liable for $7 million in punitive
damages, of which it awarded sixty percent to the Passenger
Plaintiffs and forty percent to Celebrity. The jury then awarded
John Silivanch $110,000 for medical expenses, $1,350,000 for
lost earnings, and $900,000 for pain and suffering, and it
awarded $300,000 to his wife Joyce for loss of society.
Following the jury determination, I granted the plaintiffs'
application for an award of prejudgment interest.
The defendants now move pursuant to Rules 50(b) and 59(a) of
the Federal Rules of Civil Procedure for judgment as a matter of
law or for a new trial. The Essef Defendants seek judgment or a
new trial with respect to all claims of strict liability and
negligence, and in particular with respect to proof of
causation.*fn1 They also move for judgment as a matter of law
striking the awards for punitive damages and loss of society,
and they seek a new trial on compensatory damages as well as
judgment as to certain elements of that award. In addition,
these defendants request a new trial based on purported errors
in the admission of evidence, the jury instructions, and the
conduct of the proceedings. They also renew their motion for
judgment as a matter of law or seek a new trial with respect to
Celebrity's claims of fraud. Finally, Essef Corporation and
Pac-Fab, Inc. seek judgment or a new trial, arguing that there
is no evidence of direct liability as to them and no basis for
finding them vicariously liable for the acts of Structural
Celebrity, in turn, has filed posttrial motions on two
narrower points. It seeks judgment as a matter of law striking
the award for loss of society and it challenges the award of
With respect to all of the defendants' applications, the
relevant facts will be discussed in the context of each legal
Judgment as a matter of law may be granted under Rule 50 only
if "(1) there is such a complete absence of evidence supporting
the verdict that the jury's findings could only have been the
result of sheer surmise and conjecture, or (2) there is such an
overwhelming amount of evidence in favor of the movant that
reasonable and fair minded [persons] could not arrive at a
verdict against [it]." Galdieri-Ambrosini v. National Realty &
Development Corp., 136 F.3d 276, 289 (2d Cir. 1998) (citations
omitted) (alterations in original). The court must view the
evidence in the light most favorable to the party opposing the
motion and must defer to all of the jury's credibility
determinations and reasonable inferences. Reeves v. Sanderson
Plumbing Products, Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147
L.Ed.2d 105 (2000); Raniola v. Bratton, 243 F.3d 610, 616 (2d
Cir. 2001); Caruolo v. John Crane, Inc., 226 F.3d 46, 51 (2d
Cir. 2000); Galdieri-Ambrosini, 136 F.3d at 289. On a
Rule 50 motion, the court "may not weigh the credibility of witnesses or
otherwise consider the weight of the evidence." Caruolo, 226
F.3d at 51 (citing Galdieri-Ambrosini, 136 F.3d at 289).
Indeed, "although the court should review the record
as a whole, it must disregard all evidence favorable to the
moving party that the jury is not required to believe."
Reeves, 530 U.S. at 151, 120 S.Ct. 2097 (citation omitted).
The standard for granting a new trial under Rule 59 is less
stringent. "[U]nlike a motion for judgment as a matter of law, a
trial judge considering a motion for a new trial is free to
weigh the evidence himself and need not view it in the light
most favorable to the verdict winner." United States v.
Landau, 155 F.3d 93, 104 (2d Cir. 1998) (internal quotations
and citation omitted). Accordingly, "`a motion for a new trial
may be granted even if there is substantial evidence to support
the jury's verdict.'" Caruolo, 226 F.3d at 54 (quoting
Landau, 155 F.3d at 104). A new trial is warranted if the
court "is convinced that the jury has reached a seriously
erroneous result or that the verdict is a miscarriage of
justice." Caruolo, 226 F.3d at 54 (internal quotations and
Each of the defendants' motions may now be judged against
I previously determined that this litigation falls within the
admiralty jurisdiction of the court. In re Horizon Cruises
Litigation, 101 F. Supp.2d 204, 207-09 (S.D.N.Y. 2000). "With
admiralty jurisdiction comes the application of substantive
admiralty law." East River Steamship Corp. v. Transamerica
Delaval, Inc., 476 U.S. 858, 864, 106 S.Ct. 2295, 90 L.Ed.2d
865 (1986). And, in admiralty law, common law principles of
negligence apply. See Smith v. Mitlof, 130 F. Supp.2d 578, 582
(S.D.N.Y. 2001); Jurgens v. Poling Transportation Corp.,
113 F. Supp.2d 388, 396-97 (E.D.N.Y. 2000); Diesel Tanker Ira S.
Bushey, Inc. v. Tug Bruce A. McAllister, No. 92 Civ. 5559, 1994
WL 320328, at *6 (S.D.N.Y. June 29, 1994); see also East River
Steamship, 476 U.S. at 863-66, 106 S.Ct. 2295 (incorporating
principles of product liability into maritime law).
The elements of negligence are: (1) a duty owed by the
defendant to the plaintiff; (2) breach of that duty; (3)
proximate causation of the plaintiffs injuries; and (4) damages.
See Stagl v. Delta Air Lines, Inc., 117 F.3d 76, 79 (2d Cir.
1997); see also Alfaro v. Wal-Mart Stores, Inc. 210 F.3d 111,
114 (2d Cir. 2000) (conflating the elements of causation and
damages). This formula is routinely applied in maritime cases.
See Petitt v. Celebrity Cruises, Inc., 153 F. Supp.2d 240,
252-53 (S.D.N.Y. 2001); Jurgens, 113 F. Supp.2d at 397; In re
Queen of Hearts Cruises, Inc., Nos. 96 Civ. 6712, 98 Civ. 0111,
1999 WL 195298, at *6 (S.D.N.Y. April 7, 1999). The evidence at
trial amply supported the jury's finding of negligence against
the Essef Defendants.
1. Facts Relevant to Negligence
The Essef Defendants designed and manufactured the model
TR-140 high rate sand filter used aboard the Horizon. The main
body of the filter is a hollow cylinder. Water from the
whirlpool spa is introduced into the filter by a diffuser that
operates like a shower head and disperses the water when the
filter is operating in filtration mode. The water then seeps
through the filter medium, consisting of silica sand, which
captures particulate matter such as hair, dirt, and oils. Below
the sand is a gravel bed that contains a hub from which laterals
radiate like the spokes of a wheel. While the filter is in
filtration mode, the water passes through holes in the laterals
and returns to the whirlpool spa.
Periodically, the filter must be backwashed to remove
particulate matter that has built up during the filtration
phase. Essentially, the flow is reversed. Clean water is forced
through the laterals and up through the sand, dislodging the
dirt and debris that has accumulated. It is forced out of the
filter and is ultimately released overboard. (Tr. 1346-47).
There is substantial evidence in the record that the TR-140
filter did not backwash properly. Because the laterals did not
extend all the way to the walls of the cylinder, the filter was
subject to "coring," also known as "channeling." This means that
during backwash the water flowed up primarily through the center
of the sand, leaving the outer edges of the medium uncleansed.
(Tr. 1355-58). Moreover, testing demonstrated that the sand did
not completely fluidize during backwashing. In order for the
filter medium to be properly cleaned, it is necessary for the
entire sand bed to be lifted so that the water can circulate
around each silica grain. (Tr. 1346-47). The TR-140 did not
Because of the small size of Legionella bacteria, it is highly
unlikely that individual microbes would be trapped by a sand
filter, since they would pass through the interstices between
the grains of silica. However, according to the evidence in this
case, organic matter in the form of biofilms developed in the
filters. These biofilms provided a medium for Legionella
bacteria to proliferate and also protected them from halogens
such as chlorine and bromine which are added to the spa water as
disinfectants. (Tr. 1173-75, 1684-85, 1704-06, 1755, 2306). As
the water containing the bacteria was released into the
whirlpool, it became aerosolized and was inhaled by bathers,
causing Legionnaires' Disease among those most susceptible. (Tr.
1164-65; Pl. Exh. 36 at 5, 7).
The Essef Defendants maintain that they owed no duty to the
plaintiffs both because the filter was not designed to interdict
Legionella or other bacteria and because no one could have
foreseen that a sand filter would be a source of Legionnaires'
Disease. Neither argument is persuasive.
First, a manufacturer owes a duty to consumers broader than
merely the duty to produce products that will achieve their
intended purpose; it is obligated to market only those products
that are reasonably safe when used for the intended purpose.
See Cacciola v. Selco Balers, Inc., 127 F. Supp.2d 175, 185
(E.D.N.Y. 2001); Hamilton v. Accu-Tek, 62 F. Supp.2d 802, 822
(E.D.N.Y. 1999); Liriano v. Hobart Corp., 92 N.Y.2d 232, 237,
677 N.Y.S.2d 764, 766, 700 N.E.2d 303 (1998). Thus, for example,
an automobile manufacturer may be liable for producing a car
with a gas tank which, although it adequately supplies the
engine with fuel, is susceptible to explosion in the event of a
rear-end collision. More to the point, the manufacturer of a
device that creates conditions conducive to the proliferation of
bacteria may be liable to persons who become ill as a result,
even if the device otherwise performs as required. For example,
the maker of functionally effective tampons has a duty to design
them to minimize the incidence of toxic shock syndrome, see,
e.g., Graham v. Playtex Products, Inc., 993 F. Supp. 127,
128-29, 134 (W.D.N.Y. 1998), and the manufacturer of an
intra-uterine device must minimize the danger of pelvic
regardless of how well the product works as a contraceptive.
See, e.g., Worsham v. A.H. Robins Co., 734 F.2d 676, 681-82
(11th Cir. 1984). In this case, the Essef Defendants had a duty
not to distribute a filter that facilitated the growth of
Second, the Essef Defendants construe the foreseeability
requirement too narrowly. A manufacturer may be liable for
marketing a product that causes injuries that were generally
foreseeable; a plaintiff need not demonstrate that the defendant
should have foreseen the precise type of injury that actually
occurred. The Restatement (Second) of Torts states:
(1) If the actor's conduct is a substantial factor in
bringing about harm to another, the fact that the
actor neither foresaw nor should have foreseen the
extent of the harm or the manner in which it occurred
does not prevent him from being liable.
(2) the actor's conduct may be held not to be a legal
cause of harm to another where after the event and
looking back from the harm to the actor's negligent
conduct, it appears to the court highly extraordinary
that it should have brought about the harm.
Restatement (Second) of Torts § 435. Thus, if a defendant's
conduct could predictably contribute to the transmission of
disease, that defendant is liable even if the particular disease
contracted by a plaintiff is rare. For example, because it is
well-known that mishandling of blood supplies may result in the
infection of persons who receive transfusions, blood services
may be liable to a victim who contracted Acquired Immune
Deficiency Syndrome ("AIDS"), even if the defendant's conduct
occurred before AIDS was identified. See Wadleigh v.
Rhone-Poulenc Rorer, Inc., 157 F.R.D. 410, 420 (N.D.Ill. 1994);
Doe v. United States, 737 F. Supp. 155, 162 (R.I. 1990);
Gaffney v. United States, No. 88-1457-Z, 1990 WL 57625, at *7
(Mass. April 26, 1990).
In this case, the jury heard evidence that by the 1980's the
spa industry, including officials of the Essef Defendants, had
become aware that certain illnesses, including Legionnaires'
Disease, were associated with the operation of whirlpool spa
systems. (Tr. 1664-67, 1669-71, 1680-81, 1757; Deposition of
Stanley H. Frederick dated May 17, 1999 ("Frederick May 17, 1999
Dep."), at 129, 161-66, attached as Exh. 2 to Declaration of
Robert A. Jacobs dated Feb. 16, 2001 ("Jacobs Decl.");
Deposition of Stanley H. Frederick dated May 18, 1999
("Frederick May 18, 1999 Dep."), at 278-80, 382-83, attached as
Exh. 3 to Jacobs Decl.; Deposition of Ronald Robol dated May 20,
1999 ("Robol May 20, 1999 Dep."), at 1116-17, attached as Exh. 5
to Jacobs Decl.; Exhs. C-116, C-324, attached as Exhs. 7 and 8,
respectively, to Jacobs Decl.).*fn4 Significantly, it was
known that the build-up of organic materials reduced the
effectiveness of chemical disinfectants. (Tr. 1683-84, 1704-06).
Accordingly, in 1984, the National Sanitation Foundation ("NSF")
modified its standards for sand filters to require them to
demonstrate that backwashing would thoroughly remove organics.
(Tr. 1703-06). Thus, there is evidence that the connection
between the operation of sand filters and the transmission of
disease was sufficiently well-known to satisfy the
The TR-140 filter had been designed for use in swimming pools.
(Tr. 342-44). Nevertheless, the Essef Defendants marketed it for
use in spas as well, and included a sticker that falsely stated
that the National Sanitation Foundation had approved it for such
purposes. (Frederick May 17, 1999 Dep. at 170-71; Pl. Exh. 54 ¶¶
33, 34). Prior to doing so, they never conducted tests to
determine whether it was suited for use in spas. (Tr. 239, 403;
Frederick May 17, 1999 Dep. at 191; Pl. Exh. 54 ¶¶ 11-14).
Indeed, the TR-140 failed the NSF's sand bed flatness test (Tr.
615-16), a result that indicated that the filter might have
problems with coring or channeling. (Tr. 341, 641). One of Essef
Corporation's own employees, Steven Suchanek, had warned the
president of that company that the TR-140 was defectively
designed and that its inability to backwash properly was
preventing disinfectants from circulating throughout the filter
medium. (Tr. 1344, 1355-62, 1373-79). Similarly, Stanley
Frederick, Pac-Fab's former vice president for engineering,
testified that the TR-140 was not well suited for spas because
it could not be completely cleansed of accumulated organic
materials. (Frederick May 17, 1999 Dep. at 88-89, 184-85; Exh.
C-152). Indeed, Pac-Fab's chief engineer stated that he would
not recommend using the filter in spas. (Robol May 20, 1999 Dep.
at 1133-34). Nevertheless, the TR-140 continued to be marketed
for just such purposes.
There is no dispute that John Silivanch, along with other
passengers, acquired Legionnaires' Disease from the whirlpool
spa aboard the Horizon. The Essef Defendants do, however,
contest two aspects of causation. First, they argue that the
most severe of Mr. Silivanch's injuries are not attributable to
the disease. This issue will be considered below in connection
with the analysis of compensatory damages. Second, these
defendants contend that there was insufficient proof that the
TR-140 filters contributed to the presence of Legionella
bacteria in the spa. That argument is not persuasive.
In the investigation of the outbreak aboard the Horizon, the
Centers for Disease Control and Prevention (the "CDC") recovered
Legionella bacteria from the sand filters of the spa system.
(Pl. Exh. 37 at 6, 11). These bacteria were indistinguishable
from organisms found in the respiratory system of one of the
victims of the outbreak. (Pl. Exh. 37 at 6). Furthermore, the
CDC found that "[v]isual examination of the filter material
showed extremely heavy organic loading. This loading remained in
the filter despite reports that a routine (daily) filter
backwash cycle was implemented." (Pl. Exh. 37 at 11). These
objective observations provided the basis for the inferences
drawn by the plaintiffs' expert witnesses. Linden Witherell, an
expert in public health engineering and epidemiology, testified
that the failure of the TR-140 filter to backwash properly had
allowed the accumulation of organic matter in the filters, which
in turn trapped Legionella bacteria and provided an environment
for them to proliferate. (Tr. 1690-93, 1705-09, 1753-56,
1783-85, 2274-76, 2306-08, 2317-20). Similarly, Dr. Joseph
Plouffe, an epidemiologist, also identified the filters as the
point of amplification for Legionella within the
spa system on the Horizon. (Tr. 1174-75, 1177, 1196, 1203-04).
The jury thus had sufficient evidence from which it could find
causation. None of the Essef Defendants' efforts to undermine
that evidence warrant either judgment as a matter of law or a
The Essef Defendants maintain that the outbreak was
attributable not to the filters but to the failure of the crew
to utilize chemical disinfectants properly. The Essef
Defendants' expert, Dr. William Rowley, testified that with
adequate halogenation, no Legionella should have been able to
survive and infect the passengers. (Tr. 2196). The plaintiffs'
experts, however, had testified as to the mechanisms by which
the build-up of organic material in the filters would protect
the bacteria and render the halogens less effective. The jury
was entitled to credit this evidence.
To the extent that the Essef Defendants now argue that
Celebrity's negligence was a superceding cause that relieves
them of liability, this contention, too, must be rejected. The
party seeking to establish a superceding cause has the burden of
demonstrating that the act in question was the sole proximate
cause of the injuries incurred. See Exxon Co. v. Sofec, Inc.,
54 F.3d 570, 574-75 (9th Cir. 1995), aff'd, 517 U.S. 830, 116
S.Ct. 1813, 135 L.Ed.2d 113 (1996). And, whether a party has met
that burden is generally an issue for the jury. See Parsons v.
Honeywell, Inc., 929 F.2d 901, 905 (2d Cir. 1991). Here, it was
rational for the jury to determine that Celebrity's negligence
was a concurrent, not superceding, cause of the outbreak. See
Hirsch v. Polymark Corp., 889 F. Supp. 714, 715-16 (S.D.N.Y.
1995) (employee's removal of safety guard concurrent cause of
plaintiffs injury along with defective design of machine). The
jury could reasonably have concluded that the accumulation of
organics in a negligently designed TR-140 filter was the
principal cause of the outbreak and, at the same time, determine
that Celebrity was also negligent for failing to take
precautions against filter failure such as periodically
superchlorinating the spa system.*fn5
With respect to the issue of Celebrity's negligence, the Essef
Defendants also complain that their expert, Dr. Rowley, was
precluded from testifying that the spa was operated with one
pump at a time rather than two. (Tr. 2104-08). This witness did,
however, offer his opinion that operation in this manner was
"unbelievable." (Tr. 2104). He was prevented only from offering
calculations of flow based on a single pump because these
calculations had not been disclosed during expert discovery
prior to trial. (Tr. 2107). This preclusion order was
appropriate under Rule 37(c)(1) of the Federal Rules of Civil
Procedure since this failure to disclose would have prejudiced
the plaintiffs and Celebrity by preventing them from effectively
challenging at trial the somewhat arcane analysis. See Lamarca
v. United States, 31 F. Supp.2d 110, 122 (E.D.N.Y. 1999).
Moreover, Dr. Rowley's failure to include these calculations in
his expert report cannot be excused on the basis that the
factual predicate for them was only revealed at trial: the fact
that the spa was operated with a single pump was disclosed in a
deposition in 1997 (Deposition of Ioannis Ladakis dated March 3,
1997, at 89, attached as Exh. 19 to Jacobs Decl.), as well as in
the spa system operations
manual produced in pretrial discovery. (Pl. Exh. 19 attached as
Exh. 20 to Jacob Decl.).
b. Post Hoc, Ergo Propter Hoc
The Essef Defendants next argue that the mere fact that the
passengers became ill after the spa water had passed through the
TR-140 filters does not prove that the filters caused the
disease. This proposition is unassailable. "[A] temporal
relationship by itself provides no evidence of causation." In
re Breast Implant Litigation, 11 F. Supp.2d 1217, 1238 (Colo.
1998) (citation omitted). But such a temporal relationship can
corroborate other proof of a causal nexus, see Zuchowicz v.
United States, 140 F.3d 381, 385 (2d Cir. 1998), and, as
discussed above, there is much evidence here beyond the mere
fact that the spa water passed through the filters at a point in
time before the passengers were infected.
Next, the Essef Defendants reason that any inference of
causation is negated by the fact that there was never an
outbreak of Legionnaires' Disease on the Zenith, a sister ship
to the Horizon that was also operated by Celebrity and which had
an identical spa system including TR-140 filters. There is no
merit to this rationale. In the real world causation is rarely
so uncomplicated that seemingly similar conditions will always
lead to the same outcome. While it could certainly be argued to
the jury that the experience of the Zenith indicated that the
filters were not at fault for the outbreak on the Horizon, the
jury was not obligated to credit that argument.
The Essef Defendants also contend that the TR-140 filters were
substantially altered after sale in that the laterals were
deformed, apparently by heat, and thus rendered less effective.
"[I]f a consumer alters a product in a way that creates a
defect, the consumer's conduct rather than the manufacturer's is
the proximate cause of any ensuing accident." Hood v. Ryobi
America Corp., 181 F.3d 608, 612 (4th Cir. 1999) (citation
omitted). Put another way,
[t]he injuries suffered by [the plaintiff] must be
the proximate result of a defect which existed in the
product at the time it was sold, and if the product
has been materially altered or modified by a third
party after the sale, those injuries cannot be traced
to be the proximate result of [the defendant's]
Lamb v. Sears, Roebuck & Co., 1 F.3d 1184, 1188 (11th Cir.
1993) (citations omitted). See also Valentin v. C.G. Bretting
Manufacturing Co., 278 A.D.2d 230, 231, 717 N.Y.S.2d 281, 282
(2d Dep't 2000) (issue of fact regarding material modification
precludes summary judgment); Rios v. Rockwell ...