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Certain Underwriters v. Doncasters

March 30, 2011

CERTAIN UNDERWRITERS, SUBSCRIBING TO POLICY NUMBERS DG055707, DG061908, 4N65010001, RMP201072954 AND PCA9002942-00 AND AS SUBROGEE OF LAKE ROAD GENERATING COMPANY, LP AND BG NORTH AMERICA, LLC PLAINTIFF,
v.
DONCASTERS, INC. ET AL DEFENDANTS.



The opinion of the court was delivered by: Hon. Vanessa L. Bryant United States District Judge

MEMORANDUM OF DECISION DENYING THE DEFENDANTS' [DOC. #19] MOTIONS TO DISMISS, GRANTING THE DEFENDANTS' MOTION FOR A MORE DEFINITE STATEMENT [DOC. #19], AND GRANTING THE PLAINTIFF'S MOTION FOR LEAVE TO FILE AN AMENDED COMPLAINT [DOC. #23]

Before the Court are motions filed by defendants Doncasters Group, Ltd., Doncasters, LLC, Doncasters, Inc. and Doncasters, Inc. -- Doncasters Precision Castings -- New England Division ("Doncasters" or "the Defendants"). The Defendants move to dismiss all counts and allegations brought by the plaintiff, Certain Underwriters Subscribing To Policy Numbers DG055707, DGO61908, 4N65010001, RMP201072954 and PCA9002942-00 ("Certain Underwriters" or "the Plaintiff") as Subrogee of Lake Road Generating Company, LP ("Lake Road"), and BG North America, LLC ("BG") pursuant to Federal Rules of Civil Procedure Rules 12(b)(1) and 12(b)(6) [Doc. #19]. The Defendants assert that: 1) the Court lacks subject matter jurisdiction due to an absence of diversity of citizenship, 2) that the complaint consists of conclusory allegations unsupported by factual assertions resulting in the Plaintiff's failure to state a claim upon which relief can be granted, and 3) that Counts II through V of the complaint are improperly alleged in conjunction with the Plaintiff's products liability count. Alternatively, the Defendants move pursuant to Federal Rule of Civil Procedure Rule 12(e) for an order requiring the Plaintiff to re-plead its Complaint. [Doc. #19]. Also before the Court is the Plaintiff's [Doc. #23] Motion for Leave to File an Amended Pleading, pursuant to Federal Rule of Civil Procedure Rule 15(a), by which the Plaintiff seeks to address and dispose of the issues raised by the Defendants in their Motion to Dismiss and Motion for a More Definite Statement. The Defendants object to the Plaintiff's requested amendment on the ground that the Court, lacking subject matter jurisdiction, is obliged to dismiss the action. [Docs. ##24-25].

Background

Certain Underwriters initiated the instant action against Doncasters in connection with the failure of a blade installed in a gas turbine generating unit located at Lake Road's facility in Dayville, Connecticut on or about June 12, 2008. Certain Underwriters alleges that the Lake Road was owned by its insured BG at the time of the failure and that it has reimbursed its insured for costs relating to the blade failure. Certain Underwriters alleges "based on information and belief" that the "Defendants manufactured, assembled, distributed, sold, constructed, serviced, inspected, tested and/or supplied the blade at issue" and therefore asserts subrogation rights to recover payment from the Defendants pursuant to a complaint consisting of five counts, including: 1) product liability; 2) a malfunction theory of liability; 3) general negligence; 4) specific negligence; and 5) a res ipsa loquitur theory of negligence. [Doc. #1].

Standard of Law

Federal courts are courts of limited jurisdiction and may not entertain matters over which they do not have subject matter jurisdiction. Wynn v. AC Rochester, 273 F.3d 153, 157 (2d Cir. 2001). Subject matter jurisdiction cannot be waived by parties to an action, and it also cannot be created through consent of those parties. Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 701-702 (1982). "A federal court has subject matter jurisdiction over a cause of action only when it 'has authority to adjudicate the cause' pressed in the complaint." Arar v. Ashcroft , 532 F.3d 157, 168 (2d Cir. 2008) vacated on other grounds , 585 F.3d 559 (2d Cir. 2009), cert. denied , 130 S. Ct. 3409 (2010) (quoting Sinochem Int'l Co. v. Malay Int'l Shipping Corp. , 549 U.S. 422, 425 (2007)).

"Determining the existence of subject matter jurisdiction is a threshold inquiry and a claim is properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it." Id . (internal citations and quotation marks omitted). Federal courts are presumptively without jurisdiction over civil matters and the burden of establishing the contrary rests upon the party asserting it. Kokkonen v. Guardian Life Ins. Co. of Am. , 511 U.S. 375, 377 (1994). "When jurisdiction is challenged, the plaintiff bears the burden of showing by a preponderance of the evidence that subject matter jurisdiction exists, and the district court may examine evidence outside of the pleadings to make this determination." Id . (internal citations and quotation marks omitted). The court should determine questions of subject matter jurisdiction before considering the merits of a case. Steel Co. v. Citizens for a Better Environment , 523 U.S. 83, 94-95 (1998).

The United States Supreme Court recently reexamined the standard governing a motion to dismiss, made pursuant to Rule 12(b)(6), for failure to state a claim upon which relief may be granted. See Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009). "Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a 'short and plain statement of the claim showing that the pleader is entitled to relief.'" Id. at 1949. While Rule 8 does not require detailed factual allegations,

A pleading that offers labels and conclusions or a formulaic recitation of the elements of a cause of action will not do. Nor does a complaint suffice if it tenders naked assertion[s] devoid of further factual enhancement. To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face. A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.

Id. (internal citations and quotation marks omitted).

In evaluating a motion to dismiss, the court should follow a "two-pronged approach" to evaluate the sufficiency of the complaint. Hayden v. Paterson, 594 F.3d 150, 161 (2d Cir. 2010). "A court 'can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth.'" Id. (quoting Iqbal, 129 S.Ct. at 1950). "At the second step, a court should determine whether the [remaining] 'well-pleaded factual allegations,' assumed to be true, 'plausibly give rise to an entitlement to relief.'" Id. (quoting Iqbal, 129 S.Ct. at 1950).

A district court has broad discretion to allow amendment of complaints, and leave to amend should be freely given where the interests of justice so require. Fed. R. Civ. P. 15(a); Gurary v. Winehouse, 235 F.3d 792, 801 (2d Cir. 2000).

Analysis

While Certain Underwriters asserts diversity jurisdiction pursuant to 28 U.S.C. ยง1332, Doncasters contends that diversity jurisdiction is lacking as the operative complaint identifies Certain Underwriters as a foreign entity, domiciled in the United Kingdom with a principal place of business in London, ...


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