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Burnett v. Damon Corp.

United States District Court, Second Circuit

December 2, 2013

KAREN L. BURNETT, Plaintiff,
v.
DAMON CORP., previously d/b/a Damon Motor Coach and n/k/a Thor Motor Coach, Inc., a wholly-owned subsidiary of Thor Industries, Inc., Defendant. DAMON CORP., previously d/b/a Damon Motor Coach and n/k/a Thor Motor Coach, Inc., a wholly-owned subsidiary of Thor Industries, Inc., Third-Party Plaintiff,
v.
FLAGG ENTERPRISES, INC., d/b/a Flagship RV's, Third-Party Defendant.

MARTIN A. LYNN, ESQ., LYNN LAW FIRM, LLP, Syracuse, NY, Attorneys for Plaintiff Burnett.

TIMOTHY P. MURPHY, ESQ., JAMES P. YOUNGS, ESQ., ZACHARY M. MATTISON, ESQ., HANCOCK ESTABROOK, LLP, Syracuse, NY, Attorneys for Damon Corp./Thor.

JEFFREY F. BAASE, ESQ., R. ANTHONY RUPP, III, ESQ., RUPP, BAASE, PFALZGRAF, CUNNINGHAM & COPPOLA, LLC, Buffalo, NY, Attorneys for Flagg Enterprises, Inc.

MEMORANDUM-DECISION

DAVID N. HURD, District Judge.

I. INTRODUCTION

On November 4, 2010, Karen L. Burnett ("plaintiff" or "Burnett")-a resident of Onondaga County, New York-initiated this action against defendant Damon Corp., now known as Thor Motor Coach, Inc. ("Thor"), a Delaware corporation that designs and manufactures recreational motor homes. Plaintiff filed an amended complaint on March 2, 2011, and asserts three state claims for strict products liability, negligence, and failure to warn arising from personal injuries allegedly caused by harmful mold that grew in her motor home.[1]

Thor subsequently filed a third-party complaint, and ultimately a second amended third-party complaint, against Flagg Enterprises, Inc. ("Flagg"), a Florida corporation that owns and operates several motor home dealerships in Florida. Thor alleges negligence on the part of Flagg and seeks contribution and/or indemnification from Flagg. Flagg filed a counterclaim against Thor for indemnification.

Thor has filed a motion seeking to preclude the testimony of plaintiff's experts and, in turn, for summary judgment on the three claims in the amended complaint. Plaintiff responded in opposition, [2] and Thor replied. Flagg has filed a motion for summary judgment with regard to Thor's second amended third-party complaint. Thor has responded in opposition, and Flagg replied. Oral argument was heard on June 14, 2013, in Utica, New York. Decision was reserved.

II. FACTUAL BACKGROUND

Unless otherwise noted, the following facts are undisputed. Further factual allegations will be developed as needed in the discussion. Flagg was founded in 1998 by Gary and Lori Flagg and was an authorized distributor of Thor vehicles in Florida during the relevant time period. The Dealer Agreement that guided this business relationship contains an "Indemnification by Manufacturer" clause as well as an "Indemnification by Dealer" clause.[3]

On December 16, 2005, Burnett purchased a Thor Daybreak recreational vehicle ("the RV") from a Flagg dealership in Florida. Thor manufactured the RV in August 2004, and it had over 1000 miles on the odometer when plaintiff purchased it. She alleges that the RV was constructed using organic, untreated material that is susceptible to mold growth. Thor conducted a "rain booth" test on the RV before shipping it to Flagg's dealership. This test consists of placing the vehicle inside a large booth and spraying water on it while a Thor employee performs a visual inspection for leaks inside the RV. This is completed after all of the fixtures, carpeting, and furniture have been installed inside the vehicle. Plaintiff maintains that several lines of Thor motor homes, including the Daybreak, the Intruder, and the Challenger, all experienced water leakage and mold growth of which Thor was aware. According to Lori Flagg, all motor homes are visually inspected after delivery to the Flagg dealership.

Burnett owned two similar motor homes in the past and was aware that some parts of such a vehicle may leak. The RV she purchased on December 16 came with an owner's manual that contained notices regarding warranties and outlined recommended maintenance intervals. Notices were also posted on different areas of the RV itself. The RV was covered by a limited warranty that lasted twelve months or 12, 000 miles, whichever occurred first.[4]

Within a few months after purchasing the RV, Burnett noticed that the driver-side window was not aligned properly. She also discovered water damage on the inside passenger-side wall in the front of the RV, near the passenger window. She brought the RV back to the Flagg dealership for repairs at least three times between January and April 2006. In January Flagg performed work on the window on the driver's side. This window was jammed, and Flagg staff loosened and reset the window frame. In February Flagg adjusted the rubber seal around the driver's door. On April 6, 2006, Flagg repaired the water-damaged wall panel and resealed the passenger window. The RV had 2100 miles on the odometer at that time. In October 2006 plaintiff noticed leakage around the windshield on the passenger side and brought the RV to two separate vendors in Syracuse, New York, where the windshield was repaired and/or resealed.

Plaintiff next observed a leak around the driver's window in December 2006. At that time the RV had sat at her sister's home in Virginia for a period of time, and mold and mushrooms had formed on the driver's-side floor. She dug out the mushrooms with a knife and removed the mold by scrubbing the carpet with bleach. She kept some of the mushrooms, which she showed to Flagg employees when she brought the RV back to the Florida dealership in early 2007. At that time, Flagg performed a "Sealtech" inspection and found extensive leaks in the RV. However, plaintiff did not request, and Flagg did not perform, any repairs at that time. Burnett claims water continued to leak into various areas of the RV thereafter, and mold again grew inside the passenger compartment. She again attempted to remove the mold herself using various methods in 2009 and 2010.

Between 2006 and 2010 Burnett resided in upstate New York during the summer and in Florida during the winter. As such, she slept in the RV in Florida during the winter months-typically November through April. In May 2010 a routine CAT scan revealed a mass in her left lung.[5] In July 2010 she underwent surgery to remove the mass. This procedure was performed by Dr. Suhas V. Pradhan, M.D. ("Dr. Pradhan"), a thoracic surgeon at the Veterans Affairs Medical Center in Syracuse. Upon completion of the surgery, and after consulting with pathology, Dr. Pradhan diagnosed plaintiff with aspergilloma caused by inhalation of aspergillus mold.

Burnett retained four experts. In July 2010 CRAL Contracting, Inc. ("CRAL") examined the RV and issued a report on August 5, 2010. Murphy Decl., Ex. 22, ECF No. 37-23, 46-72.[6] CRAL noted visible mold in the front of the RV and found aspergillus/penicillium in the air inside the RV at a concentration sixteen times higher than that of ambient air. A second examination was conducted in August 2012 by Matthew DaRin, an indoor environmental hygienist with Bluepoint Environmental, LLC ("DaRin"), who issued a report on September 19, 2012. DaRin Aff., Ex. B, ECF No. 55-2. DaRin observed mold, mushroom growth, and water damage in the front of the vehicle on the passenger side and near the "slide-out" behind the driver's seat. He claimed that this damage was indicative of chronic and long-term moisture intrusion. He further noted that over forty percent (40%) of the living space inside the RV was contaminated with mold, and he measured higher concentrations of mold in the air inside the RV than in outdoor air. He faulted the design of the RV and Thor's allegedly inadequate rain booth testing.

Professional engineer Eugene Camerota ("Camerota") completed an investigation, which included three inspections of the RV between July 2011 and August 2012, and issued a report on September 20, 2012. Camerota Aff., Ex. A, ECF No. 57-1. He noted carpet discoloration and/or mushroom growth near the slide-out behind the driver's seat, on the floor near the bottom of the driver's door, below the passenger-side window, and on the floor under the dashboard on the passenger side. He reported that the extensive damage suggests water had been leaking into the RV "for a considerable time prior to Burnett taking delivery of the motor coach." Id . 9. He concluded that manufacturing flaws caused the leaks, and he faulted Thor's testing process for failing to discover the leaks prior to delivery to the dealership. Specifically, he claims the rain booth test should have been conducted on the empty shell of the RV, not after all the fixtures had been installed, to allow for easy identification of leaks.

A fourth report was issued on September 24, 2012, by Dr. William Sawyer of Toxicology Consultants & Assessment Specialists, LLC ("Dr. Sawyer"). Murphy Decl., Ex. 22, ECF No. 37-23, 77-90 ("Dr. Sawyer Report"). Dr. Sawyer noted that the levels of aspergillus found by CRAL in the RV "are in the extreme upper range of any values ever reported in the literature for living quarter environments." Id . 87. He opined that Burnett was "exposed to hazardous levels of toxic molds" in the RV, which is consistent with her diagnosis of aspergilloma. Id . 90.

Thor has also retained and identified four experts, including Dr. Hung K. Cheung, M.D., an environmental and occupational medicine specialist ("Dr. Cheung"), and Dr. Michael Larranaga, Ph.D., a professional engineer ("Dr. Larranaga"). Dr. Cheung found plaintiff's experts' opinions to be unreliable and concluded that her "medical conditions were not causally related to any alleged exposure to mold" in the RV. Cheung Decl., ΒΆ 7, ECF No. 37-31. Dr. Cheung further opined that there is a lack of medical evidence to support a diagnosis of aspergilloma. Dr. Larranaga inspected the RV in October 2011 and performed a peer review of plaintiff's experts' reports. Larranaga Decl., Ex. 2, ECF No. 37-46. He criticized their opinions and methodology, and specifically faulted their failure to consider alternative sources of exposure to aspergillus.

Thor also relies on the examinations and testimony of Thomas Bailey ("Bailey") and Thomas Fribley ("Fribley"). Bailey conducted an infrared thermography investigation of the RV on October 6, 2011. He noted mold growth on the driver's side "slide out" and near the windshield on the passenger's side. However, he reported that these areas were not moist despite a recent rainfall and concluded that "[t]he area above and below the passenger side front window that was sealed by Flagship RV in April of 2006 showed no mold or water intrusion." Baase Decl., Ex. Q-6, ECF No. 39-25, 18.

Fribley also inspected the RV on October 6, 2011. He observed heavy mold growth in the front corner of the slide out and on the passenger side near the windshield. He concluded that there was no manufacturing defect by Thor nor any negligent repair work by Flagg. Baase Decl., Ex. Q-7, ECF No. 39-26, 7. Bailey and Fribley instead suggest that the water leakage and mold growth was caused by the natural deterioration of the seals and rubber moldings on the RV, and plaintiff's failure to properly maintain same as directed in the owner's manual.

Although it is undisputed that the RV sustained water damage and contained mold during the relevant time period, the parties vigorously dispute the cause of the water intrusion and subsequent mold growth. They also dispute whether plaintiff's lung condition was caused by the mold in the RV and whether the mold found in the RV is of the same type that could have caused such an injury. Burnett has been unable to use the RV since 2011, and it currently sits in storage in Syracuse, New York, at her expense. Flagg went out of business in 2011.

III. DISCUSSION

A. Motion for Summary Judgment-Legal Standard

Thor and Flagg have each moved for summary judgment pursuant to Federal Rule of Civil Procedure 56. The entry of summary judgment is warranted when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett , 477 U.S. 317, 322 (1986) (citing FED. R. CIV. P. 56(c)); see also Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247 (1986). A fact is "material" for purposes of this inquiry if it "might affect the outcome of the suit under the governing law." Anderson , 477 U.S. at 248; see also Jeffreys v. City of New York , 426 ...


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