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Travelers Lloyds Insurance Co. v. All-Glass Aquarium Co., Inc.

United States District Court, Fifth Circuit

January 17, 2014

THE TRAVELERS LLOYDS INSURANCE COMPANY, as Real Party in Interest and Subrogee of MANNATECH, INC., Plaintiff,
DALLAS NORTH AQUARIUM, Third-Party Defendant.


SAM A. LINDSAY, District Judge.

Before the court is Defendant All-Glass's Motion for Summary Judgment (Doc. 22), filed September 16, 2013. After careful consideration of the motion, response, briefs, evidence, record, and applicable law, the court grants Defendant All-Glass's Motion for Summary Judgment (Doc. 22).

I. Procedural and Factual Background

On September 6, 2012, Plaintiff The Travelers Lloyds Insurance Company ("Plaintiff" or "Travelers"), as the real party in interest and subrogee of insured Mannatech, Inc. ("Mannatech") brought this products liability case against All-Glass Aquarium, Co. Inc. ("Defendant" or "All-Glass") asserting claims based on strict liability and negligence. Travelers seeks subrogation damages in the amount of $371, 434.28 that it paid to its insured Mannatech for property loss sustained to Mannatech's commercial business place. Travelers also seeks costs of court and prejudgment and postjudgment interest. Travelers contends that Mannatech's place of business was damaged when an allegedly defective aquarium fluorescent light component ("AFLC")[1] manufactured by All-Glass caught fire on May 14, 2011. With regard to strict liability, Travelers asserts that there were defects in the design, manufacturing, and marketing of All-Glass's AFLC. In support of its products liability claim based on negligence, Travelers alleges that All-Glass failed to use ordinary care with respect to the design, manufacturing, and marketing of the AFLC.

All-Glass filed its Original Answer on October 14, 2012, denying Travelers's substantive allegations. All-Glass also asserts affirmative defenses, contending that Travelers is contributorily negligent for failing to properly maintain the premises and AFLC. All-Glass alleges in the alternative that it is not liable to Travelers because the alleged damages: (1) were caused by the negligent acts of third parties over which All-Glass had no control; (2) were caused by an unvoidable accident; or (3) resulted from Mannatech failing to use ordinary care in reducing, avoiding, or mitigating the alleged damages. On May 16, 2013, All-Glass filed its Third Party Complaint against Dallas North Aquarium Service, Inc. ("Dallas North Aquarium"). Dallas North Aquarium has not entered an appearance in the action, and there is no indication from the docket that service of process has been effected as to Dallas North Aquarium. Further, there has been no request for entry of default and motion for default judgment against Dallas North Aquarium. For these reasons, the court determines that Dallas North Aquarium has not been served, that it lacks personal jurisdiction over Dallas North Aquarium, and that it will dismiss the third-party complaint against Dallas North Aquarium for lack of personal jurisdiction.

On September 16, 2013, All-Glass moved for summary judgment on Travelers's claims, contending that Travelers has "no evidence" to support the elements of any of its claims based on manufacturing defects, design defects, marketing defects, and negligence. All-Glass asserts that, while circumstantial evidence may be used to establish any fact material to a products liability claim, Travelers's evidence of the single fire that occurred on May 14, 2011, is legally insufficient to survive summary judgment because proof of a product failure alone is insufficient under Texas law. According to All-Glass, Travelers must also eliminate the existence of other possible causes of the incident by showing that other possible causes are impossible or improbable.[2] With regard to Travelers's products liability claim based on negligence, All-Glass states: "Whereas strict products liability focuses on whether the product was sold in a defective condition unreasonably dangerous to the user, negligence focuses on the supplier's standard of care... [and] the acts of the manufacturer and asks whether it exercised ordinary care in design and production." Def.'s Br. 7. All-Glass contends that Travelers has no evidence that it failed to comply with its duties of ordinary care in designing, manufacturing, or marketing the fish tank light.

In response to the summary judgment motion, [3] Travelers concedes that it does not have sufficient summary judgment evidence to establish a genuine dispute of material fact that the AFLC manufactured by All-Glass was defectively designed or marketed. Travelers therefore agrees that All-Glass is entitled to judgment on these claims. Travelers nevertheless contends that there is sufficient evidence to raise a genuine dispute of material fact as to whether the AFLC was defectively manufactured. In this regard, Travelers contends that there is a genuine dispute of material fact whether, on May 14, 2011, the AFLC manufactured by All-Glass "was defective or unreasonably dangerous; that such condition existed when it left [All-Glass]; and that the [AFLC] was the cause of the fire and [P]laintiff's damages." Pl.'s Br. 34. Travelers also requests the opportunity to present oral argument regarding its response to the summary judgment motion. With respect to its negligence claim, or what it refers to as its "negligent manufacturing claim, " Travelers "concedes that... [it] is subsumed within its defective product theories. Id. 32.

All-Glass did not file a reply in support of its summary judgment motion and therefore appears not to dispute the factual matters upon which Travelers relies. The court will therefore consider these factual matters to be undisputed and true as long as they are supported by the record and competent summary judgment evidence. Applying the applicable summary judgment standard, the court concludes, for reasons herein explained, that Travelers's evidence is insufficient to raise a genuine dispute of material fact with respect to any of the elements of its manufacturing defect claim, the only claim remaining after Travelers's aforementioned concessions. All-Glass is therefore entitled to judgment on all of Travelers's claims.

II. Motion for Summary Judgment Standard

Summary judgment shall be granted when the record shows that there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986); Ragas v. Tennessee Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998). A dispute regarding a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When ruling on a motion for summary judgment, the court is required to view all facts and inferences in the light most favorable to the nonmoving party and resolve all disputed facts in favor of the nonmoving party. Boudreaux v. Swift Transp. Co., Inc., 402 F.3d 536, 540 (5th Cir. 2005). Further, a court "may not make credibility determinations or weigh the evidence" in ruling on a motion for summary judgment. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000); Anderson, 477 U.S. at 254-55.

Once the moving party has made an initial showing that there is no evidence to support the nonmoving party's case, the party opposing the motion must come forward with competent summary judgment evidence of the existence of a genuine dispute of material fact. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 586 (1986). On the other hand, "if the movant bears the burden of proof on an issue, either because he is the plaintiff or as a defendant he is asserting an affirmative defense, he must establish beyond peradventure all of the essential elements of the claim or defense to warrant judgment in his favor." Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986) (emphasis in original). "[When] the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine [dispute] for trial.'" Id. (citation omitted). Mere conclusory allegations are not competent summary judgment evidence, and thus are insufficient to defeat a motion for summary judgment. Eason v. Thaler, 73 F.3d 1322, 1325 (5th Cir. 1996). Unsubstantiated assertions, improbable inferences, and unsupported speculation are not competent summary judgment evidence. See Forsyth v. Barr, 19 F.3d 1527, 1533 (5th Cir.), cert. denied, 513 U.S. 871 (1994).

The party opposing summary judgment is required to identify specific evidence in the record and to articulate the precise manner in which that evidence supports his or her claim. Ragas, 136 F.3d at 458. Rule 56 does not impose a duty on the court to "sift through the record in search of evidence" to support the nonmovant's opposition to the motion for summary judgment. Id .; see also Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 915-16 & n.7 (5th Cir.), cert. denied, 506 U.S. 832 (1992). "Only disputes over facts that might affect the outcome of the suit under the governing laws will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. Disputed fact issues that are "irrelevant and unnecessary" will not be considered by a court in ruling on a summary judgment motion. Id. If the nonmoving party fails to make a showing sufficient to establish the existence of an element essential to its case and on which it will bear the burden of proof at trial, summary judgment must be granted. Celotex, 477 U.S. at 322-23.

III. Undisputed Facts

On May 14, 2011, a fire occurred at the office space leased by Mannatech at 600 Royal Lane, Suite 200, Coppell, Texas, in the vicinity of where a fresh water fish aquarium was located. Mannatech's office space and the aquarium were damaged in the immediate vicinity of the fire. The aquarium and AFLC were both manufactured by All-Glass or by Aqueon, a company purchased by All-Glass. When an aquarium of the kind at issue is purchased or sold as new, the aquarium, glass, lid, and light are all included in one unit.

In response to All-Glass's summary judgment motion, Travelers presented evidence in the form of expert testimony.[4] As previously noted, All-Glass did not file a reply or attempt to refute this evidence by Travelers. It is therefore undisputed. Travelers's expert, Richard Taylor ("Taylor"), conducted an investigation and concluded that the May 2011 fire originated in the AFLC, which he referred to as the "top plastic cover to the aquarium housing the fluorescent light fixture." Pl.'s App. ...

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