BNSF Railway Co. v. L.B. Foster Co.

917 F. Supp. 2d 959, 2013 WL 97925, 2013 U.S. Dist. LEXIS 3487
CourtDistrict Court, D. Nebraska
DecidedJanuary 8, 2013
DocketNo. 4:11CV3076
StatusPublished
Cited by2 cases

This text of 917 F. Supp. 2d 959 (BNSF Railway Co. v. L.B. Foster Co.) is published on Counsel Stack Legal Research, covering District Court, D. Nebraska primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
BNSF Railway Co. v. L.B. Foster Co., 917 F. Supp. 2d 959, 2013 WL 97925, 2013 U.S. Dist. LEXIS 3487 (D. Neb. 2013).

Opinion

MEMORANDUM AND ORDER ON DEFENDANT’S MOTION FOR SUMMARY JUDGMENT

WARREN K. URBOM, Senior District Judge.

The plaintiff, BNSF Railway Company (BNSF), filed a six-count amended complaint against the defendant, L.B. Foster Company (L.B. Foster), on August 5, 2011. (ECF No. 15.) Now before me is L.B. Foster’s motion for summary judgment. (ECF No. 43.) For the following reasons, I find that L.B. Foster’s motion must be granted.

I. BACKGROUND1

BNSF is a Delaware corporation. (Def.’s Statement of Material Facts (Def.’s Facts) ¶ 11, ECF No. 45.) Though its principal place of business is located in Fort Worth, Texas, (see id.), it is registered and authorized to do business in Nebraska, (Pl.’s Statement of Additional Material Facts (Pl.’s Facts) II15, ECF No. 54). Indeed, BNSF has conducted a substantial amount of its business in Nebraska since its formation. (See Pl.’s Facts ¶¶ 17-22.) L.B. Foster is a Pennsylvania Corporation that is registered and authorized to do business in Nebraska. (Def.’s Facts ¶ 12; Pl.’s Facts ¶ 1.)

On or about June 19, 2002, Darrell Leibhart, a Roadmaster for BNSF’s Butte Subdivision, ordered a 132-pound bonded insulated rail joint (the insulated joint) from L.B. Foster. (Pl.’s Facts ¶¶ 6-7; Pl.’s Index, Ex. 6, Liebhart Aff. ¶¶ 6-7 & Exs. [961]*9616A-6B, ECF No. 55-6.) The insulated joint was manufactured in Indiana by L.B. Foster’s subcontractor, Midwest Rails, Inc., (Def.’s Facts ¶ 10), and shipped to BNSF in Crawford, Nebraska, (Pl.’s Index, Ex. 6, Liebhart Aff. Ex. 6A, ECF No. 55-6). On or about June 11, 2003, the insulated joint was installed on BNSF’s railroad track near Ardmore, South Dakota. (Pl.’s Index, Ex. 6, Liebhart Aff. ¶ 6; Def.’s Facts ¶ 1.)

According to L.B. Foster, the sale of this insulated joint was “governed” by an agreement between L.B. Foster and BNSF dated April 1, 1998 (the Agreement). (Def.’s Facts ¶¶ 4-6, 8.) The Agreement states that it became effective on April 1, 1998, and would “continue in force until March 31, 2001, unless terminated by either party” in accordance with the Agreement’s terms. (Def.’s Index, Ex. 2, Shue Aff. Ex. 2A at 5, ECF No. 44-3.) It also states, “This Agreement shall be governed by the laws of the State of Kansas.” (Id. at 6.) There is no evidence, however, that BNSF ever signed the Agreement. (See id. at 8. See also Pl.’s Index, McKee Aff. ¶¶ 6, ECF No. 55-7.) Moreover, the order for the insulated joint was placed beyond the effective term of the Agreement. Although BNSF and L.B. Foster did enter into an “Agreement for Purchase of Insulated Joints” on November 1, 2003, it appears there was no signed written agreement between the parties in effect between March 1, 2001, and November 1, 2003, pertaining to the sale of insulated joints. (See Pl.’s Index, McKee Aff. ¶¶ 5, 7,13-21, ECF No. 55-7.)

On or about January 22, 2008, a BNSF train departed from Edgemont, South Dakota, and derailed while passing over the insulated joint on the track near Ardmore, South Dakota. (Def.’s Facts ¶ 2.) At the time of the derailment, the train was bound for Alliance, Nebraska. (Pl.’s Facts ¶ 12.) Kenneth Willey, who has served as BNSF’s Trainmaster for the Butte Subdivision since 2007, states that as far as he is aware, “no South Dakota residents were personally injured in the derailment, and no South Dakota residents suffered any property losses.” (PL’s Index, Ex. 8, Willey Aff. ¶ 10, ECF No. 55-8.) He adds, “No injuries or property damage to South Dakota residents or businesses were reported to BNSF as a result of the derailment at issue. There were no service interruptions to local South Dakota businesses caused by the derailment on my section of track (because there are no businesses in this area to be affected).” (Id.)

BNSF filed a complaint against L.B. Foster on May 19, 2011, (ECF No. 1), and, as noted above, it filed a six-count amended complaint on August 5, 2011, (ECF No. 15). In its amended complaint, BNSF alleges that its post-accident investigation revealed defects in the insulated joint that could not have been reasonably discovered by BNSF prior to the derailment. (Id. ¶ 14.) BNSF adds, “As a proximate result of the failure of the defective insulated joint and the aforementioned derailment, BNSF has incurred damages to its property, including its rolling stock, vehicles and equipment, to its locomotives, railcars, lading, signal equipment, rails, ties, and other track structures, and BNSF has suffered business interruption costs, including without limitation, train delay and train crew charges, all at a cost to BNSF in excess of One Million Dollars.... ” (Id. ¶ 15.) It also alleges, “BNSF’s operations in Nebraska were directly impacted by the derailment. BNSF employees from Nebraska provided the labor and material related to the post-derailment cleanup effort. Consequently, all of the costs associated with the cleanup, which totaled approximately $110,000, were charged to BNSF facilities in Nebraska.” (Id. ¶ 16.)

[962]*962In Count I, which is titled “Negligence,” BNSF alleges that L.B. Foster “was negligent in failing to ensure that the insulated joint was safe for the use for which it was manufactured, assembled, supplied, distributed, sold or otherwise placed into interstate commerce!,] and [L.B.] Foster breached its duty of reasonable care owed to BNSF by failing to properly and adequately research, develop, design, test, manufacture, assemble, inspect, specify, instruct, advise, warrant, warn, maintain, recall and correct defects in the insulated joint.” (Id. ¶ 18.)

In Count II, which is titled “Negligent Misrepresentation,” BNSF alleges that L.B. Foster “failed to exercise reasonable care or competence in obtaining, managing and communicating accurate and truthful information related to its insulated joints and thereby misrepresented facts concerning their use, quality, specifications and performance characteristics” “for the purpose of inducing NBSF to rely upon said misrepresentations and purchase insulated joints.” (Id. ¶¶ 22-23.) It adds that “BNSF reasonably and justifiably relied upon the facts misrepresented by [L.B.] Foster related to the insulated joint and purchased a defective insulated joint to its ultimate detriment.” (Id. ¶ 24.) BNSF also claims that the derailment “was a direct and proximate result of said misrepresentations of facts by [L.B.] Foster.” (Id.)

In Count III, which is titled “Strict Liability,” BNSF alleges that when L.B. Foster “sold the insulated joint to BNSF, the insulated joint was in a defective condition, unreasonably dangerous to BNSF’s personnel, property and premises when put to its intended use[,] and [L.B.] Foster knew or in the exercise of reasonable care should have known that the insulated joint would be used by BNSF without an inspection for such latent defects.” (Id. ¶ 27.) BNSF also alleges that the defective insulated joint reached “BNSF without substantial change in the condition in which it was when it was supplied, distributed or, otherwise placed in interstate commerce,” and that “BNSF used the insulated joint in a manner reasonably anticipated by [L.B.] Foster and for the general purpose for which it was designed, manufactured, and sold.” (Id. ¶¶ 28.) It adds, “As a result of said defective condition, the insulated joint failed!,] resulting in the derailment....” (Id. ¶ 30.)

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Cite This Page — Counsel Stack

Bluebook (online)
917 F. Supp. 2d 959, 2013 WL 97925, 2013 U.S. Dist. LEXIS 3487, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bnsf-railway-co-v-lb-foster-co-ned-2013.