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HARTFORD INS. CO. v. BROAN-NUTONE

April 16, 2004.

The HARTFORD INSURANCE CO. a/s/o HARRY MAJOR, and STATE FARM INSURANCE COMPANIES a/s/o DORTHEA HOLLAND, Plaintiffs
v.
BROAN-NUTONE, LLC, a Delaware corporation, Defendant



The opinion of the court was delivered by: JAMES MORAN, Senior District Judge

MEMORANDUM OPINION AND ORDER

Hartford Insurance Company (Hartford) and State Farm Insurance (State Farm) brought this subrogation action to recover for property damage to an apartment owned by Harry Major and rented by Dorthea Holland. The damage was caused by a fire, which plaintiffs allege started in a range hood manufactured by defendant Broan-Nutone LLC (Broan-Nutone). In their second amended complaint, each plaintiff brings a count of strict liability and negligence against defendant. Broan-Nutone moves for summary judgment, and, for reasons hereinafter set forth, its motion is denied.

BACKGROUND

  In the early morning of December 19, 2001, a fire broke out in apartment 301 at 1304 Lunt Avenue in Chicago. Harry Major owned the apartment building and Dorthea Holland rented the apartment. On December 18, 2001, Holland arrived home between 10:30 and 11pm and soon thereafter fell asleep on the couch. When she awoke, Holland noticed smoke in the living room and heard knocking at the door. She walked down a hallway toward the kitchen, where she saw flames "shooting out" the top of the range hood. After an attempt to throw water on the flames, Holland left her apartment. The fire caused substantial damage to Major's and Holland's property.

  Major is insured by Hartford and Holland is insured by State Farm. In the aftermath of the fire, the plaintiff insurance companies hired two experts, John Agosti and Erik Anderson, to determine the cause of the kitchen fire. John Agosti specializes in the point of origin of fires. He was a member of the Skokle, Illinois, Fire Department for twenty-eight years, including six years as the Deputy Fire Chief. After leaving the department, Agosti started his own firm of fire analysts, John Agosti & Assoc. In his investigation report, Agosti states that he reviewed the Chicago Fire Department Incident Report; Holland's transcript; a paper on range hood fires; engineering notes from Anderson Engineering, the forensic engineering firm hired by plaintiffs to investigate the cause of the fire; and letters and photographs. He also examined the burn patterns at the scene of the fire. He thereafter concluded that the fire in Holland's apartment originated in the kitchen's range hood, identifying the cause of the fire as an electrical malfunction in the hood. However, he admitted that his review of the technical literature for the hood, the exemplar hood, and the remnants of the hood in Holland's apartment, did not reveal any design or manufacturing defects. Agosti stated that the proximate cause of the electrical malfunction was beyond the scope of his investigation.

  Plaintiffs hired Anderson Engineering to analyze whether an electrical element caused the fire. Erik Anderson, a co-owner of the firm, conducted the analysis for plaintiffs. He has a degree in electrical and electronic engineering, is a licensed professional engineer in three states, and from 1987 through 2001 he attended six conferences on fire investigation. Since 1987, Anderson has performed product tests, fire investigations and failure analyses for his clients, and has testified in a number of cases. After examining the range hood and various other artifacts from Holland's apartment, the exemplar hood from a neighboring apartment, as well as photographs of the fire scene, Anderson concluded that the fire "was caused by a breakdown of insulation on energized conductors internal to the Broan vent hood above the stove." He noted arcing in the hood's copper wires and determined that the arcing, in conjunction with the breakdown of insulation, ignited the fire. When asked during his deposition whether his investigation revealed any design or manufacturing defects, Anderson replied that he had not "come to that opinion" and had "not formulated that opinion . . . ." He stated that he could not identify the cause of the breakdown in the insulation that led to the arcing in the wires, and, in his opinion, the fire.

  DISCUSSION

  The court's function in ruling on a motion for summary judgment is merely to determine if there is a genuine issue of material fact for trial. Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 249 (1986). Only if the evidence on file shows that no such issue exists and that the moving party is entitled to judgment as a matter of law will the court grant the motion, Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Bennett v. Roberts, 295 F.3d 687, 694 (7th Cir. 2002). Broan-Nutone argues that it is entitled to summary judgment for two reasons. First, it contends that the opinions of both of plaintiffs' experts, Agosti and Anderson, should be disregarded because they do not meet the standard of scientific reliability set by the Federal Rules of Evidence and Daubert v. Merrill Dow Pharmaceuticals. Inc., 509 U.S. 579 (1993). Without the experts' opinions, defendant argues, plaintiffs have not evidenced their prima facie case and therefore summary judgment is proper. Second, Broan-Nutone maintains that even if the experts' opinions are admissible, they do not criticize the design, manufacture, or instructions of the range hood, and thus there is no evidence of a defect or unreasonable danger related to the hood. Both of these arguments fail.

  Under Federal Rule of Evidence 702, an expert may testify as to his/her opinion if it will assist the trier of fact in understanding the evidence or determining an issue, and 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." Thus, the court must determine whether the experts' testimony is a reliable opinion based on sound methodology and will assist the trier of fact. See Dhillon v. Crown Controls Corp., 269 F.3d 865, 869 (7th Cir. 2001), Defendant argues that the experts' opinions are not reliable because they are not based on sound methodology.

  In reaching his opinion regarding the origin of the fire, Agosti relied on an examination of the flame damage patterns, the remnants of the hood, the destruction to the structures above and adjacent to the hood, an exemplar Broan-Nutone range hood in the apartment next to Holland's, a review of the statement from Holland, and several other documents listed in his report. This is sufficient data. As explained in his report, Agosti's evaluation of the heat and flame damage patterns led him to conclude that the fire began in the range hood. This evaluation also eliminated the stove as a possible origin of the fire. Analysis of burn patterns, including the lowest area of burn, is a reliable method used by fire analysts in determining the origin of a fire. Agosti applied these methods to the evidence to reach a conclusion, which satisfies the requirements for the admissibility of expert opinion.

  Likewise, Anderson's opinion also satisfies the requirements listed in Rule 702. He applied his knowledge in electrical engineering to information gathered at the scene of the fire — he examined the range hood and other remnants from the fire. He also reviewed documentation of the scene and Holland's eyewitness report. During his investigation, Anderson was able to rule out certain electrical elements, such as the kitchen lighting and stove, as possible causes of the fire. Based on Agosti's report regarding the origin of the fire, and his observations of the hood wiring and photographs of the fire scene, including the gas stove, Anderson determined that the fire was caused by the breakdown of insulation and arcing of copper wires in the hood.

  Yet, defendant contends that Agosti's and Anderson's opinions are unreliable. In support of its argument defendant cites four factors that courts use in assessing the reliability of an expert's opinion: (1) whether it can be tested, (2) whether it has been subjected to peer review, (3) the known or potential rate of error, and (4) its general acceptance among the relevant scientific community. Dhillon, 269 F.3d at 869 (citing Daubert, 509 U.S. at 593-94). Defendant highlights the experts' failure to test the range hood before reaching their conclusions. It contends that Bourelle v. Crown Equipment Corp., 220 F.3d 532 (7th Cir. 2000), illustrates the importance of testing when evaluating the reliability of an expert opinion. In Bourelle, as in Dhillon, the plaintiff alleged that a forklift was defectively designed. Bourelle, 220 F.3d at 537. In both cases the court held that expert testimony that a forklift should have been designed in another manner was not reliable because there was no testing regarding the alternative design theories. In Dhillon, the plaintiff did not allege that the forklift he was using was defective. In fact, an inspection showed it to be in proper working order. 269 F.3d at 868. Rather, the plaintiff claimed that the design of the forklift, and all others like it, was defective. Id. In rejecting the opinion of plaintiffs expert the court emphasized that in cases that involve an allegation of defective design "we have consistently recognized the importance of testing the alternative design." Id. at 870.

  Hartford and State Farm's second amended complaint does not specifically state whether they are alleging a design or manufacturing defect. Given the importance of testing alternative designs when alleging a design defect, plaintiffs have failed to provide sufficient evidence to support a claim under that theory. However, plaintiffs' response to the motion for summary judgment indicates that they are alleging a manufacturing defect, not a design defect. Therefore, the importance of testing an alternative design does not apply. Unlike in Dhillon and Bourelle, Hartford and State Farm allege there was a failure specific to the product that gave rise to the alleged injury — an electrical malfunction in the range hood due to improper wiring by defendant The experts' opinions finding the origin of the fire to be the range hood and the cause of the fire to be an electrical malfunction in the hood, certainly support plaintiffs' allegations. The lack of testing by Agosti and Anderson does not render their opinions inadmissible. See Allstate Ins. Co. v. Mavtag Corp., 1999 WL 203349 (N.D.Ill. 1999) (quoting Cummins v. Lyle Industries, 93 F.3d 362, 369 (7th Cir. 1996) ("[T]esting is not `an absolute prerequisite to the admissibllity of expert testimony.'") The Seventh Circuit has emphasized that a court's inquiry into the reliability of an expert's opinion should be flexible and that the factors of reliability listed in Daubert should not be viewed as an exhaustive list. See Bourelle, 220 F.3d at 536; United States v. Vitek Supply Corp., 144 F.3d 476, 485 (7th Cir. 1998).

  In Spearman v. St. Paul Fire & Marine Ins. Co., 138 F. Supp.2d 1088 (N.D.Ill. 2001), the court held that a roofing expert's opinion regarding the cause of roof damage was reliable where he combined extensive experience in the field with a personal examination of the roof. Defendant attempts to distinguish the facts in Spearman from those in this case. However, as with the expert in Spearman, both Agosti and Anderson applied their expertise while conducting a personal investigation. Agosti went to Holland's apartment and observed the fire patterns and Anderson personally inspected the range hood. Agosti's and Andersen's investigations are substantially similar to the roofing expert's investigation in Spearman. The ...


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