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Angela Pirrello v. Gateway Marina

September 30, 2011

ANGELA PIRRELLO, PLAINTIFF,
v.
GATEWAY MARINA, BRUNSWICK FAMILY BOATS CO., INC. D/B/A MAXUM MARINE, AND U.S. MARINE CORPORATION, DEFENDANTS,
GATEWAY MARINA, THIRD-PARTY PLAINTIFF,
v.
JAMES PIRRELLO, THIRD-PARTY DEFENDANT.
BRUNSWICK FAMILY BOATS CO., INC. D/B/A MAXUM MARINE, THIRD-PARTY PLAINTIFF,
v.
RDS MANUFACTURING, INC., THIRD-PARTY DEFENDANT.



The opinion of the court was delivered by: Go, United States Magistrate Judge

MEMORANDUM AND ORDER

In this personal injury action arising from an explosion on a boat, plaintiff Angela Pirrello asserts claims against defendants Gateway Marina ("Gateway"), Brunswick Family Boats Co., Inc. and U.S. Marine Corporation ("Brunswick"). Gateway filed a third-party complaint against the owner of the boat and Ms. Pirrello's father, James Pirrello, and Brunswick brought third-party claims against RDS Manufacturing, Inc., the manufacturer of the boat's gas tank. Gateway, Brunswick, and RDS move for dismissal or lesser sanctions for the spoliation of evidence.

BACKGROUND

In her complaint, Ms. Pirrello alleges that on July 2, 2006, she was injured as a result of an explosion aboard a 1993 Maxum boat on which she was a passenger and her father James was the owner and operator. Amended Verified Complaint ("Am. Comp.") (ct. doc. 11) at ¶¶ 20-23. Plaintiff alleges that the explosion was caused by a gas leak that resulted from water accumulating and remaining stagnant in the gas tank compartment, causing the tank to corrode and leak fuel. Id. at ¶ 23. She claims that Brunswick is liable for a defect in the boat design or manufacture and that Gateway failed to adequately maintain the boat during the winter season preceding the explosion. Id. at ¶¶ 24, 31, 35. In response, Gateway alleges that the accident was a result of Mr. Pirrello's negligence and Brunswick claims that any defect was in the fuel tank manufactured by RDS. Gateway Third Party Complaint (ct. doc. 22) at ¶ 19; Brunswick Third Party Complaint (ct. doc. 52) at ¶ 26. Shortly after the accident, Baron & Associates, plaintiff's former counsel, advised Gateway by letter dated July 28, 2006, that it anticipated filing a claim against it for plaintiff's injuries. See ct. doc. 117 (attached to Supplemental Affirmation in Opposition to Motion to Dismiss as Exh. E). In September 2006, Mr. Pirrello hired Scott J. Schiffman, a marine surveyor, to investigate the cause of the incident.*fn1 10/5/09 Schiffman Dep. at 15 (ct. docs. 77, 78). Mr. Schiffman inspected the boat on August 25, October 3, and October 7, 2006 at Performance Marine Towing and Salvage d/b/a Sea Tow ("Performance Marine"), where the boat was towed after the accident. Mr. Schiffman or Mr. Pirrello asked the marina to remove the gas tank to enable Mr. Schiffman to visually inspect the bottom of the gas tank and the compartment where the gas tank was installed.*fn2 Catapano Dep. at 27, 94-95 (ct. doc. 75); 10/5/09 Schiffman Dep. at 66-69. On October 6, 2006, the marina removed the tank after obtaining the consent of Mr. Pirrello. Catapano Dep. at 27, 29; J. Pirrillo Dep. at 75 (ct. doc. 74). The original gas tank was placed on the top of a nearby container or shed and a "dummy" gas tank was placed in its stead for sizing purposes. Catapano Dep. at 42-43, 48, 87; 10/5/09 Schiffman Dep. at 69; 12/14/09 Schiffman Dep. at 53 (ct. docs. 79, 80). According to Cody Catapano, the owner of Performance Marine, Mr. Pirrello did not expressly instruct the marina to preserve the gas tank. Catapano Dep. at 29, 36. At one point in his deposition, Mr. Pirrello testified that he instructed Mr. Schiffman to preserve the gas tank but later testified that he could not recall whether he gave such a direction. J. Pirrello Dep. at 84-85, 137-38. Mr. Schiffman denied that he received any such instructions from Mr. Pirrello. 12/14/09 Schiffman Dep. at 140. Plaintiff, who had been recovering from her injuries, did not instruct anyone to preserve the gas tank. A. Pirrello Dep. at 22-23.

Mr. Schiffman prepared a report for Mr. Pirrello concluding that water under the vessel's gas tank caused corrosion which led to the gas leak and the resulting explosion. See ct. doc. 76-2. He opined that water seeped into the gas tank compartment because the boat may have been pitched improperly when it was stored for the winter season preceding the accident. Id. He further stated that water was able to flow into the gas tank compartment due to a flaw in the design. Id. A gas tank compartment should be water tight and sealed so that water cannot seep in. Id.

The boat has remained at Performance Marine since the accident and substantial storage fees have accrued. On August 4, 2007, Intimidator Boat Works, which is affiliated with Sea Tow, served on James Pirrello a Notice of Lien and Sale advising that it claimed a lien on the boat in the amount of $21,559.90 and that the boat would be auctioned on September 5, 2007. Nichols Aff., Exh. B (ct. doc. 88-2). According to the Notice, the estimated value of the boat was $3,000. See id. Mr. Catapano spoke with Mr. Pirrello after the Notice was served but the outstanding charges remained unpaid. Catapano Dep. at 51-52. No buyers appeared at the auction. Id. at 47. Sometime in 2008 or 2009, the gas tank was discarded as scrap. Id. at 63-64.

Plaintiff commenced this action on January 9, 2008 in Supreme Court Kings County. See ct. doc. 1. Gateway removed the state court action to this Court on May 2, 2008. See id.

On May 30, 2008, Gateway served plaintiff with a Notice of Discovery and Preservation of Evidence demanding preservation of the subject vessel. See ct. doc. 71-5. In June or July 2008, plaintiff, James Pirrello and plaintiff's former counsel, Seth Katz, met at counsel's office. Katz Dep. at 27-28, 37 (ct. doc. 114). Mr. Katz testified that at the meeting, he advised plaintiff, in the presence of her father, that they had a duty to preserve the boat in its present condition and make the boat and the gas tank available for inspection. Id. at 25, 29, 31, 36-37, 40-41, 59, 65-66, 80. By her affidavit, plaintiff denied being so advised. Supp. Nichols Aff., Exh. B at ¶¶, 7, 9 (ct. doc. 117). On the other hand, Mr. Katz also testified that "[b]ecause Ms. Pirrello was not the owner of the boat, because the boat was not within her control or supervision, there is no way that we could have instructed her to preserve or maintain something that she did not own, and was not in control over." Katz Dep. at 56; see also id. at 59. Mr. Katz never contacted the marina to ask that the boat be preserved in its present condition.*fn3 Id. at 31, 33, 36-37, 54-55.

On June 17, 2008, Gateway filed a third party complaint against James Pirrello. On July 28, 2008, Gateway served upon Mr. Pirrello a Notice of Discovery and Preservation of Evidence demanding preservation of the subject vessel.

An initial conference was held before the undersigned on July 29, 2008. It is undisputed that counsel for Mr. Pirrello notified all parties at the conference that Mr. Pirrello was not in possession of the boat because of a lien. Gallo Aff. at ¶ 9 (ct. doc. 85). Following the conference, the Court filed a minute entry stating that "Plaintiff and/or third-party defendant must provide access to the vessel, including the gas tank, for inspection by the parties and counsel, in addition to a later examination by any liability expert." See minute entry filed on July 30, 2008.

On August 8, 2008, Mr. Katz sent a letter to counsel for defendants and Mr. Pirrello providing the boat's location and stating that "in accordance with the Court's Order of July 29, 2008, access to the vessel, including the gas tank, for inspection by the parties and counsel will be provided upon sufficient advance notice to ensure availability of the marina staff."*fn4 Mr. Katz did not receive a response from any of the attorneys to schedule an inspection.

On August 19, 2008, Mr. Pirrello served initial disclosures on the parties which included a copy of the Notice of Lien and Sale. See Nichols Aff., Exh. D. Counsel for Mr. Pirrello also served a copy of the Notice of Lien and Sale on September 17, 2008, in response to document requests made by then-defendant Islander Boat Center and copied plaintiff's counsel and counsel for Gateway. See Nichols Aff., Exh. E.

On September 12, 2008, Mr. Katz filed a motion to be relieved as counsel. See ct. doc. 42. On October 17, 2008, this Court granted Mr. Katz's motion to withdraw and stayed the action until December 12, 2008 to give plaintiff an opportunity to obtain new counsel. See ct. doc. 47.

Regina Nichols, plaintiff's current counsel, entered a notice of appearance on December 16, 2008. On the same day, the Court held a status conference and directed that an inspection of the boat be conducted by January 30, 2009. See minute entry dated December 17, 2009.

On December 17, 2008, counsel for Mr. Pirrello filed a letter informing the parties that the boat was sent to auction on September 5, 2007 but that no buyers appeared. See ct. doc. 49.

In January 2009, counsel for all the parties, except for RDS which had not yet been joined, visited the facility where the vessel had been towed. Unbeknownst to counsel at the time of the inspection, the vessel did not contain the original gas tank that was in the boat at the time of the accident. However, the original gas tank may have been on top of a shipping ...


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