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Haym Salomon Home for the Aged, LLC v. HSB Group

January 20, 2010

HAYM SALOMON HOME FOR THE AGED, LLC, PLAINTIFF,
v.
HSB GROUP, INC. D/B/A/ THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY, AND AMERICAN STANDARD, INC. D/B/A TRANE U.S., INC., DEFENDANTS.



The opinion of the court was delivered by: John Gleeson, District Judge

MEMORANDUM AND ORDER

In July 2006, Haym Salomon Home for the Aged LLC ("Haym Salomon," or the "Home") filed this case against several defendants, including Hartford Steamboiler Inspection and Insurance Company ("HSB") and Trane U.S., Inc. ("Trane"). Haym Salomon filed an amended complaint on September 29, 2006, which alleges that HSB and Trane breached their insurance and maintenance contracts, respectively, HSB by refusing to cover the replacement of the Home's air conditioning unit, and Trane by failing to repair the unit. On September 15, 2009, Haym Salomon filed a motion in limine to preclude HSB's experts from testifying at trial. Trane joined in this motion. Also on September 15, 2009, Haym Salomon filed a motion for partial summary judgment as against HSB. On October 15, 2009, Trane filed a motion for summary judgment as against Haym Salomon. On October 16, 2009, HSB opposed Haym Salomon's motion and cross-moved for partial summary judgment. I heard oral argument on all four motions on December 18, 2009. For the reasons stated below, the motions are granted in part and denied in part.

BACKGROUND

For the purposes of the instant motions, I accept undisputed facts as true and resolve disputed facts in favor of the non-moving party where there is evidence to support its allegations.

In approximately 2000, Haym Salmon purchased an Air Conditioning Unit ("ACU") from Trane. Contained within the ACU was a Direct Fire Generator ("DFG"), which contained 177 tubes. Beginning when the ACU was installed at the Home, Haym Salomon maintained service contracts with Trane for the ACU. In addition, Haym Salomon had an insurance policy with HSB, which insured the ACU.

On approximately June 1, 2005, the ACU stopped working. Upon inspecting the unit, Trane determined that the DFG had at least two leaks, at least one of which was in the length of one of the DFG tubes. Specifically, Dean Tsioptsias, the service specialist who went to the Home when Trane was notified of the ACU's failure, stated in his deposition that when he took the cover off of the DFG unit, he saw one tube spraying liquid while another was dripping with liquid. An employee of Haym Salomon, Mark Jarvis, also observed the liquid coming out of the tubes and determined that there were at least two leaks. The tubes are not covered by the Trane service contract. Further, Trane advised Haym Salomon that the tubes in the DFG could not be repaired or replaced at the installation site and, instead, a new DFG should be purchased.

On approximately June 8, 2005, Haym Salomon informed HSB that the ACU was not operational. On June 10, 2005, Trane advised HSB that no DFG tubes had ever been replaced or repaired in an onsite ACU. Trane also advised HSB, as well as Haym Salomon, that the unit would have to be replaced. Haym Salomon subsequently purchased a new DFG from Trane.

In July and August 2005, HSB retained Atlas Welding and Par Mechanical ("Par"). At the request of HSB, Atlas Welding removed the rear of the DFG and cut into it. On August 17, 2005, Par performed a test of the DFG on behalf of HSB. Par's representative, Dennis Casey, stated that there were two positive tests, which suggested there was a leak in a DFG tube. John Bevington and Karen T. Fuentes, who are HSB's proposed experts in this case, witnessed the test on behalf of HSB. At the end of October 2005, HSB directed Atlas Welding to cut out tubes from the DFG for testing at M&M Engineering's facility.

In June 2007, HSB stated that Haym Salomon had failed to provide documentation demonstrating that the damage to the DFG was the result of an "accident" within the meaning of HSB's policy. HSB further told Haym Salomon that there was no evidence that a leak existed in the DFG.

In October 2008,Fuentes, on behalf of M&M Engineering, provided an Expert Report regarding her examination of the DFG. She found that "[n]o leaks could be located in the [DFG] during pressure testing of the unit." Ex. D. to Decl. of Arthur J. Liederman. Bevington also issued a report. His report stated that no leaks were found in the tubes when they were subjected to pressure up to 19 pounds per square inch ("psi"), even though Trane had purportedly found a leak at 3 psi. Further, Bevington stated that, contrary to Trane's assertion, there was no tube failure in the DFG. Bevington further stated that even if there were a leak in a DFG tube, Haym Salomon could have patched it.

Robin R. Lee, Trane's Technical Service Engineer, stated in a letter dated September 1, 2005, that repairing the leaky tubes would cause additional damage, potentially damaging the entire ACU. Further, she noted that no repair on a DFG tube has ever been successfully performed.

DISCUSSION

A. Admission of Expert Testimony

Haym Salomon and Trane move to preclude the expert testimony of Karen Fuentes and John Bevington, HSB's proposed experts. Rule 702 of the Federal Rules of Civil Procedure provides that an expert can testify in the form of an opinion if: "(1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case." Fed. R. Civ. P. 702. Rule 702 requires me to ensure that "any and all scientific testimony or evidence is not only relevant, but reliable." Daubert v. Merrell Dow Pharmaceuticals, Inc.,509 U.S. 579, 589 (1993).Haym Salomon and Trane do not argue that the expert testimony is irrelevant, but rather that the experts are not qualified to testify as experts.

1. Fuentes

Karen Fuentes has been a registered professional engineer in the State of Texas since 1985. She received a degree in engineering from the University of Texas in 1980 and is a member of the American Society of Mechanical Engineers. Fuentes is president and senior consulting engineer of M&M Engineering Associates, Inc., which performs accident investigations, failure analysis and materials testing of a wide range of components. Her resume states that she "conducts the on-site analysis of in-service failures." She has performed several investigations to determine the cause and origin of a failure in equipment, the scope of the damage and any options for repair. Fuentes's educational background and work experience appropriately cover the disputed factual issues in this case. Accordingly, Fuentes has sufficient "knowledge, skill, experience, training, or education" in the engineering field to qualify her as an expert witness. Fed. R. Civ. P. 702. Furthermore, ...


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