The opinion of the court was delivered by: HARRY LEINENWEBER, District Judge
MEMORANDUM OPINION AND ORDER
Before the Court are the Partial Motions for Summary Judgment
of Defendants System Transport, Inc. (hereinafter, "System"),
Genie Industries, Inc. (hereinafter, "Genie"), and Market
Transport, Ltd. (hereinafter, "Market").
This diversity action arises from a tragic auto accident that
occurred on September 1, 2001. On that day, System's driver
Gregory Maine, was transporting two Z-60 lifts manufactured by
Genie on a flatbed tractor-trailer. Maine loaded the lifts at the
Genie facility in Moses Lake, Washington and was traveling
southbound toward North Carolina on I-65. The Pierce family which included husband, wife and infant son, was also traveling in
their family car on I-65 when they sustained a flat tire outside
Hobart, Indiana. Mr. Pierce pulled over to the shoulder and began
fixing the tire with Mrs. Pierce's assistance. Their son Allen
remained in the car.
While Mr. Pierce was fixing the flat tire, Maine lost control
of the System trailer after driving through a construction zone
lane shift and hitting a dip in the highway. The trailer fell to
its right and the two Genie Z-60 lifts broke loose of their
securement chains and straps. One lift hit the Pierce family car,
which burst into flames and killed the couple's son, who was
trapped inside the car. Mary Pierce watched the crash and the
subsequent death of her son while standing outside the car.
Another lift collided with Mr. Pierce and severed his leg, which
he lost as a result of the accident.
The Third Amended Complaint seeks compensatory and punitive
damages based on theories of negligence, wrongful death, strict
liability, and negligent infliction of emotional distress as a
result of the collision.
Summary judgment is appropriate 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." FED. R. CIV. P. 56(c). A
genuine issue of triable fact exists only if "the evidence is
such that a reasonable jury could return a verdict for the
nonmoving party." Pugh v. City of Attica, 259 F.3d 619, 624
(7th Cir. 2001) (quoting Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986)).
A. System's Partial Motion for Summary Judgment
System leased the flatbed tractor-trailer involved in the
accident and employed the driver, Gregory Maine. Its partial
summary judgment motion involves Plaintiffs' punitive damages
claim against System. The Court already has concluded that
Indiana law applies to this case. (See 4/23/02 Minute Order).
System claims that Indiana law does not support punitive damages
under the facts here.
Under Indiana law, punitive damages will not stand if the facts
demonstrate negligence only (i.e., merely failing to act as a
reasonable person does not constitute the type of conduct
punishable by punitive damages). See, e.g., Austin v. Disney
Tire Co., Inc., 815 F. Supp. 287 (S.D. Ind. 1993). The purpose
of punitive damages is to identify and deter conduct that is
driven by a mental state of obduracy. Id. at 288. For conduct
to be punishable by punitive damages, one must look to the
actor's subjective state of mind and determine that the actor
recognized the danger that would probably result in injury, and consciously
and intentionally disregarded it. Id. at 288-89; see also
Purnick v. C.R. England, Inc., 269 F.3d 851, 852 (7th Cir. 2001)
(stating that the "punitive damages standard in Indiana . . .
presents a high hurdle"). "Punitive damages may be awarded upon a
showing of defendants' will and wanton misconduct, even absent
malice, ill will, or intent to injury." Wanke v. Lynn's Trans.
Co., 836 F. Supp. 587, 599-600 (N.D. Ind. 1993) (citing
Picadilly, Inc. v. Colvin, 519 N.E.2d 1217, 1221 (Ind. 1988)).
Negligent conduct, on the other hand, is judged by a reasonable
person objective standard. Punitive damages must be proved by
clear and convincing evidence and the analysis is fact-driven.
Ind. Code § 34-51-3-2; Wanke, 836 F. Supp. at 599-600.
System argues that the evidence shows that Maine did not act in
an obdurate or iniquitous manner and was instead conscientious
about the safety of the load, thus precluding punitive damages.
System points out several factors to indicate Maine's safe and
cautious driving: he drove 1900 miles without incident before the
accident; he sped up beyond the 45 mile-per-hour limit in a
construction zone only in an attempt to stabilize his load; he
conducted a pre-trip inspection of the trailer and the load; he
stopped and investigated the trailer when he initially felt the
load lean to the right in Moses Lake, Washington; upon arriving
at the System Spokane, Washington facility he asked a System
mechanic to inspect the trailer; an Indiana Motor Carrier Enforcement
Inspector found that the trailer load was in compliance with DOT
regulations; and he tightened the chains and replaced the strap
securing the Genie lift in Lake Station, Indiana on August 31
one day before the accident. (Sys. Br. at 9-10).
System also points to the fact that Maine initially requested
that the lifts be loaded facing each other, but his request was
denied. Also, both of Plaintiffs' experts, Nathan Ware and
Kenneth Baker, opined that more likely than not, the accident
would not have occurred if Genie had specified and loaded the
lifts facing each other (basket-to-basket), and would not have
occurred if loaded on a stepdeck trailer. System notes that
Plaintiffs' experts state that Maine's speed above 45 m.p.h. only
contributed to the accident, which was defined by the
above-stated conditions. (Id. at 11; Pl. App. Exhs. 12 & 14).
In addition, System points out that there is no evidence to show
that Maine was impaired in his driving for example, he was not
intoxicated, he was not on drugs, and he had rested for twenty
hours in Indiana shortly before the accident. These facts, System
contends, indicate that any fault on System's part only could be
attributed to mistaken judgment or human error, which actions do
not contemplate a punitive award.
Plaintiffs argue that System failed to paint a complete picture
of the relevant facts. Plaintiffs indicate that beyond the above stated facts, Maine never hauled a Z-60 lift before and
that System did not provide Maine with specific directions for
Genie lift securement or Genie load tie-down instructions prior
to the accident. Plaintiffs emphasize the fact that from the
moment Maine left the Genie facility in Moses Lake, Washington,
he felt that the load was insecure. Even after Maine and a System
mechanic checked the load, he still felt that it was leaning
"bad" and was "scary." (Pl. Res. at 3). While still in the
Spokane area, Plaintiff alerted his dispatcher of the problem via
a text message, who instructed him with urgency to return to
System's Spokane yard due to the instability, but he did not and
System did not further press the order. Throughout the trip,
Maine indicated that he felt "uncomfortable" with the load,
experiencing "instability" in left turns, but that he did not
notify anyone. Maine's dispatcher Robert DeBolt testified that he
may have resolved the situation by phone, but could not recall
and there is no other record to indicate any conversation.
The facts do not independently substantiate a punitive damage
award. However, the analysis examines the totality of the
circumstances. Wanke, 836 F. Supp. 604. By itself, the fact
that Maine never transported a Z-60 lift before the accident is
not enough. At the time of the accident, Maine was an experienced
truck driver and in good standing. Further, Maine had a System
safety manual, but it is disputed as to whether Maine also had a copy of recommended Genie tie-down securement instructions at the
time of the accident. (System admits in response to Plaintiffs
interrogatories that Genie communicated instructions to System
regarding the Z-60 lifts and other products (Market App., Exh.
9)). Maine's actual securement method of the lifts, using three
binders, three chains, and one strap is undisputed. Genie's
tie-down instructions recommended further securement for safe
transport. Even if Maine had no knowledge of Genie's specific
instructions, outstanding issues remain as to whether the
securement loop holes located throughout the lifts were obvious
to Maine and whether their use in securement was a necessity for
safe transport. Further, Maine's dispatcher at System, Robert
DeBolt, stated in his deposition that if he had noticed the lifts
only were secured with three chains, he would have resecured the
lifts with at least five chains on each lift.
With respect to Maine and System's load stability concerns,
even given the facts in the light most favorable to Plaintiffs,
there is no evidence to infer that System followed-up to resolve
the potentially dangerous situation. Also, although Maine
continually checked the securement chains throughout the trip, he
never ceased to feel uncomfortable with his leaning load and
never wholly rectified the problem. After the initial text
message to System, Maine did not mention the leaning load to his
supervisors again. Although it remains a fact issue, Maine's speed in the
construction zone, somewhere between 45 and 60 m.p.h., as well as
the "dip" in the construction zone and the lane shift, probably
contributed to the accident. The speed limit was 45 m.p.h.
Speeding alone, however, does not give rise to punitive damages.
See Wanke, 836 F. Supp. at 604. System points to Maine's own
statements regarding speeding through the construction zone that
indicate he was consciously attempting to restabilize the lifts
and avoid an accident by pushing on the throttle, which made the
load feel more comfortable. (System 56.1 ¶ 41) (Pl. 56.1 Resp. ¶
41). Plaintiffs contend, however, that slowing down, especially
through turns, is intuitive to avoid tipping when transporting a
load that has a high center of gravity. (Pl. Res. Br. at 5; see
Beckley deposition). Also, Maine stated that throughout the trip
the load felt unstable, but that it was more comfortable when
slowing down through left turns.
Maine's subjective mental state is at issue. The jury may
determine that Maine and System's actions account only for gross
misjudgment or human error. However, their actions also indicate
a dangerous pattern of warning signs that were apparent and
acknowledged by Maine and System, but that were insufficiently
attended to or disregarded in order to proceed with the scheduled
delivery. Because issues of intent and securement remain, the
jury must make those factual determinations at trial. Based on
the evidence, a reasonable jury could find that System and Maine
acted with the requisite state of mind to justify a punitive
award by clear and convincing evidence. Accordingly, System's
motion for partial summary judgment is denied, and the punitive
damage claim against System survives for trial.
B. Genie Industries' Partial Motion for Summary Judgment
Genie filed a motion for partial summary judgment on three
issues. First, that strict liability is not applicable under
Indiana's product liability statute. Second, that there is no
basis for Allen Pierce's emotional distress damages claim. Third,
that there is not enough evidence to support a punitive ...