Opinion
Civ. Action No. 96-1814(JBS).
October 22, 2002
Philip Licht, Esquire, Mount Laurel, NJ and Beverly C. Moore, Jr. Esquire, MOORE BROWN, Washington, D.C., Attorneys for Plaintiffs.
C. Scott Toomey, Esquire, CAMPBELL, CAMPBELL, EDWARDS CONROY, P.C., Washington Professional Campus II, Turnersville, NJ, Attorneys for Defendants Ford and UTA, Inc.
Brian C. Anderson, Esquire, Neil Gilman, Esquire, O'MELVENY MYERS, LLP, Washington, D.C., Attorneys for Defendant Ford Motor Co.
Scott L. Winkelman, Esquire, CROWELL MORING LLP, Washington, D.C., Attorney for Defendant United Technologies Automotive, Inc.
OPINION
This matter comes before the Court upon Ford's motion for partial summary judgment on plaintiff Swiklinski's state law claim under Pennsylvania's Unfair Trade Practices and Consumer Protection Law ("UTPCPL"). The Court had previously reinstated Swiklinski's claim for implied warranty of merchantability in the Opinion and Order of June 27, 2002. Defendant Ford filed this motion for partial summary judgment on September 27, 2002, and this Court heard oral argument on October 21, 2002. For the reasons stated herein, defendant's motion will be granted.
Jeffrey Swiklinski also claims recovery under the implied warranty of merchantability; attorneys' fees pursuant to the UTPCPL or the Magnuson-Moss Act; and enhanced damages under the UTPCPL. See Def.'s Br. at 1.
Plaintiff Jeffrey Swiklinski resided in Pennsylvania when he purchased a new 1990 Ford Escort LX on December 28, 1989. On June 21, 1995, at a mileage of 57,234, the car caught fire. He makes no claim for personal injury. He seeks damages for the loss of the automobile itself, in the amount of $4,675. Defendant moves for partial summary judgment on Swiklinski's UTPCPL claim based on the recent Third Circuit decision in Werwinski v. Ford Motor Co., 286 F.3d 661 (3d Cir. 2002), which affirmed the district court's holding that the economic loss doctrine applies to transactions between manufacturers and ordinary consumers and therefore barred plaintiffs' fraudulent concealment and UTPCPL claims. "The economic loss doctrine `prohibits plaintiffs from recovering in tort economic losses to which their entitlement flows only from a contract.'" Id. at 671 (quoting Duquesne Light Co. v. Westinghouse Elec. Corp., 66 F.3d 604, 618 (3d Cir. 1995)). The Third Circuit in Werwinski, first noting that the Pennsylvania Supreme Court had not addressed the two issues of whether the doctrine applied to only commercial entities and whether it barred actions for intentional fraud, stated that "[i]n the absence of guidance from the state's highest court, we are to consider decisions of the state's intermediate appellate courts for assistance in predicting how the state's highest court would rule." Werwinski, 286 F.3d at 670 (quoting Gares v. Willingboro Township, 90 F.3d 720, 725 (3d Cir. 1996)).
A court may grant summary judgment only when the materials of record "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). In deciding whether there is a disputed issue of material fact the court must view the evidence in favor of the non-moving party by extending any reasonable favorable inference to that party. See Aman v. Cort Furniture Rental Corp., 85 F.3d 1074, 1080-81 (3d Cir. 1996);Meyer v. Riegel Prods. Corp., 720 F.2d 303, 307 n. 2 (3d Cir. 1983), cert. denied, 465 U.S. 1091 (1984). The threshold inquiry is whether there are "any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986).
"The nonmoving party creates a genuine issue of material fact if it provides sufficient evidence to allow a reasonable jury to find for him at trial." Brewer v. Quaker State Oil Refining Corp., 72 F.3d 326, 330 (3d Cir. 1995) (citing Anderson, 477 U.S. at 248). Once the moving party has carried its burden of establishing the absence of a genuine issue of material fact, "its opponent must do more than simply show that there is some metaphysical doubt as to material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Thus, if the non-movant's evidence is merely "colorable" or is "not significantly probative," the court may grant summary judgment. Anderson, 477 U.S. at 249-50.
Under this approach, the Third Circuit relied in part on a decision by the en banc panel of the Pennsylvania Superior Court in REM Coal Co. v. Clark Equip. Co., 563 A.2d 128 (Pa.Super. 1989), which held that "negligence and strict liability theories do not apply in an action between commercial enterprises involving a product that malfunctions where the only resulting damage is to the product itself." Werwinski, 286 F.3d at 671 (quoting REM Coal, 563 A.2d at 134). The Superior Court had adopted the doctrine set forth in the United States Supreme Court decision of East River S.S. Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 871 (1986) (applying the economic loss doctrine in an admiralty products liability case, noting that "a manufacturer in a commercial context has no duty under either negligence or strict-liability theory to prevent a product from injuring itself"). The Superior Court further dismissed the tort remedy in such situations, stating that "contract theories such as breach of warranty are specifically aimed at and perfectly suited to providing complete redress in cases involving . . . economic losses." Werwinski, 286 F.3d at 671 (quoting REM Coal, 563 A.2d at 129).
The Third Circuit in Werwinski also relied on the Pennsylvania Superior Court decision in Jones v. Gen. Motors Corp., 428 Pa. Super. 544 (1993), to predict how the Pennsylvania Supreme Court would resolve the matter. The Superior Court in Jones affirmed the trial court's summary judgment determination in favor of the manufacturer, finding that the economic loss doctrine barred the consumer's strict liability claim. The Superior Court, finding the economic loss doctrine applicable to the individual consumer as well as a commercial entity, reasoned that "[r]egardless of whether a consumer is a commercial entity or an individual, a manufacturer's warranty as to the quality of its product is a bargained for condition of sale, the effect of which must not be undermined." Werwinski, 286 F.3d at 672 (quotingJones, 428 Pa. Super. at 666).
Plaintiffs raise Zwiercan v. Gen. Motors Corp., No. 3234, 2002 WL 31053838 (Pa. Com. Pl., Sept. 11, 2002), suggesting that this subsequent state trial court ruling overrides the Third Circuit's decision in Werwinski. The Zwiercan decision discussed the Werwinski case, noting that the Third Circuit "applied the economic loss doctrine to UTPCPL claims . . . on the belief that exempting statutory claims from the doctrine would nullify the doctrine." Zwiercan, 2002 WL 31053838, at *7. TheZwiercan court reasoned that "[t]o apply the economic loss doctrine to all claims under the UTPCPL has the potential to eviscerate the UTPCPL itself. The instant case is an example of the danger of applying the economic loss doctrine too broadly."Id. Indeed, the situation presented in Zwiercan was one where the plaintiff no longer had a viable breach of contract claim,see id. at *7, unlike the plaintiffs in Werwinski, who maintained a claim for breach of express warranty, see Werwinski, 286 F.3d at 665, and unlike plaintiff Swiklinski in the present case who maintains his claim for implied warranty of merchantability. The court in Zwiercan stated that to apply the economic loss doctrine to bar her UTPCPL claim "would frustrate the intent of the UTPCPL, in this context, and would be inconsistent with the purpose of the economic loss doctrine."Id. Rather than expressly disagree with the Third Circuit inWerwinski, the court distinguished itself from the Third Circuit's holding in allowing the plaintiff to proceed with her UTPCPL claim where she was unable to bring a breach of contract claim, in order to effectuate the legislative purpose of the statute.
The present claim cannot be distinguished from Werwinski. In this case, like Werwinski, Swiklinski's claim under the UTPCPL asserts damages arising solely out of alleged property damages; he has not alleged any personal injury damages. See Fifth Amended Compl. ¶ 5(l); Def.'s Br. at 4. The asserted damages have allegedly occurred solely to plaintiff's vehicle, not his person, and his UTPCPL claim should therefore be dismissed underWerwinski and the economic loss doctrine, which "prohibits plaintiffs from recovering in tort economic losses to which their entitlement flows only from a contract," Werwinski, 286 F.3d at 671. In addition, neither the principle of Zwiercan nor the purpose of the UTPCPL statute are diminished by this result, as Swiklinski's claim for implied warranty of merchantability survives, thereby not impeding the statutory purpose of preventing unfair or deceptive practices.
Furthermore, the Zwiercan decision, particularly as it does not render the Werwinski decision clearly wrong, is not automatically binding upon this Court. In adjudicating substantive issues of state law, a federal court must apply the law of the state. See Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938). As for state law issues, "the State's highest court is the best authority on its own law. If there be no decision by that court then federal authorities must apply what they find to be the state law after giving `proper regard' to relevant rulings of other courts of the State." Commissioner v. Estate of Bosch, 387 U.S. 456, 465 (1967). On issues of state law, "the decisions of lower state courts are not automatically binding upon this court," Lundy v. Adamar of New Jersey, Inc., Civ. A. No. 91-3183, 1993 WL 724802, at *12 (D.N.J. Mar. 31, 1993) (citing 19 Wright et al. Federal Practice and Procedure: Jurisdiction § 4507), aff'd, 34 F.3d 1173 (3d Cir. 1994), nor are they automatically binding upon a federal court of appeal.See Assicurazioni Generali, S.P.A. v. Clover, 195 F.3d 161, 166 (3d Cir. 1999) (citing Robinson v. Jiffy Executive Limousine Co., 4 F.3d 237, 242 (3d Cir. 1993)). Here, where the Pennsylvania Supreme Court has not spoken on the issue, and where the Third Circuit has issued a decision on the matter, absent a contrary ruling or change in statutory law that renders it clearly wrong or incorrect, this Court must abide by it.
Plaintiffs' reference to Grant v. Bridgestone Firestone, Inc., 2002 WL 372941 (Pa. Com. Pl. Jan. 10, 2002) does not change this fact. Plaintiffs raise Grant, issued three months prior to the Third Circuit's issuance of Werwinski, as another Pennsylvania state court decision that also rejected the contention that the economic loss doctrine barred UTPCPL claims. It can be safely assumed that the Third Circuit gave "proper regard" to the relevant rulings of other courts of the state prior to its determination in Werwinski, see Robertson v. Allied Signal, Inc., 914 F.2d 360, 378 (3d Cir. 1990). Moreover,Grant also represents the decision of a trial court, not an appellate court, and it remains an unpublished ruling of no precedential value, so far as this Court can determine. To the extent that plaintiffs seek this Court to disregard the ruling by the Third Circuit, there is no authority cited by plaintiffs that would allow this Court to do so.
CONCLUSION
For the reasons discussed above, defendant's motion for partial summary judgment as to Swiklinski's UTPCPL claim will be granted, and the UTPCPL claim will be dismissed. The accompanying Order will be entered.
ORDER
THIS MATTER having come before the Court upon defendant Ford's motion for partial summary judgment on plaintiff Swiklinski's state law claim under Pennsylvania's Unfair Trade Practices and Consumer Protection Law ("UTPCPL"); and the Court having considered the parties' submissions; and the Court having heard oral argument on October 21, 2002; and for the reasons discussed in the Opinion of today's date;
IT IS on this day of October, 2002, hereby
ORDERED that defendant's motion for partial summary judgment of plaintiff Swiklinski's UTPCPL claim be, and hereby is, GRANTED ; and plaintiff Swiklinski's UTPCPL claim is hereby DISMISSED.