Crossing at Eagle Pond, LLC v. Lubrizol Corp.

346 F. Supp. 3d 1048
CourtDistrict Court, E.D. Michigan
DecidedSeptember 28, 2018
DocketCivil Action No. 16-13432
StatusPublished
Cited by2 cases

This text of 346 F. Supp. 3d 1048 (Crossing at Eagle Pond, LLC v. Lubrizol Corp.) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Crossing at Eagle Pond, LLC v. Lubrizol Corp., 346 F. Supp. 3d 1048 (E.D. Mich. 2018).

Opinion

Denise Page Hood, Chief Judge

I. BACKGROUND

A. Procedural Background

On September 19, 2016, Plaintiff The Crossing at Eagle Pond, LLC ("Eagle Pond") brought this products liability action against Defendants Lubrizol Corp. and its subsidiary Lubrizol Advanced Materials, Inc. ("LZAM") (collectively, "Defendants") in the Sixth Judicial Circuit Court for Oakland County, Michigan, alleging Defendants were negligent in designing and selling a defective compound that contributed to leaks that occurred within the plumbing system of an apartment building owned by Eagle Pond.1 (Doc # 1) On September 22, 2016, Defendants removed this action to the United States Court for the Eastern District of Michigan, based on diversity. (Id. )

This matter is before the Court on Defendants' Motion for Summary Judgment, filed on October 31, 2017. (Doc # 17) Pursuant to a Stipulation and Order (Doc # 19), Eagle Pond filed a Response on January 3, 2018. (Doc # 20) Defendants filed a Reply on January 25, 2018. (Doc # 21) Defendants argue that:

(1) Lubrizol Corp. should be dismissed;
*1052(2) Eagle Pond lacks standing to bring this products liability action;
(3) Michigan's Economic Loss Doctrine limits Eagle Pond to damages under the Uniform Commercial Code (UCC) and bars Eagle Pond from seeking damages in tort;
(4) if the Economic Loss Doctrine applies, the four year Statute of Repose contained in Michigan's UCC bars Eagle Pond from pursuing this action;
(5) if the Economic Loss Doctrine does not apply, the three year statute of limitations for products liability claims in Michigan bars Eagle Pond from pursuing this action; and
(6) Eagle Pond's purchase of the Eagle Pond Apartments with knowledge of the leaks in the plumbing system forecloses this products liability action.

For the reasons that follow, Defendants' Motion for Summary Judgment is GRANTED

B. Factual Background

The Crossing at Eagle Pond, LLC ("Eagle Pond") is the owner of an apartment complex in Walled Lake, Michigan known as The Crossing at Eagle Pond Apartments (the "Eagle Pond Apartments"). Eagle Pond was established by Bleznak Real Estate Investment Group ("BRI Group"), a commercial holding company. In October 2011, the BRI Group purchased the Eagle Pond Apartments from Walled Lake Granite, LLC through five separate, but related, BRI Group owned entities: BRI-W # 1, LLC; BRI-W # 2, LLC; BRI-W # 3, LLC; BRI-W # 5, LLC; BRI-W # 6, LLC (collectively, the "Five LLCs"). (Doc # 20, Pg. 5) While under the ownership of the Five LLCs, the Eagle Pond Apartments' plumbing system experienced leaks on October 26, 2011; April 15, 2012; March 31, 2013; and June 14, 2013. (Id. ) The Five LLCs subsequently hired Delta Mechanical to re-pipe the entire Eagle Pond Apartments plumbing system. (Id. ) Eagle Pond acquired the Eagle Pond Apartments from the Five LLCs in January 2016. (Id. ) Eagle Pond is owned by the same owners of the Five LLCs. The Five LLC owners retained the same ownership percentages in the Eagle Pond Apartments each held respectively before the acquisition. Eagle Pond and the Five LLCs are Michigan companies.

Defendant LZAM, a subsidiary of Lubrizol Corp., is the manufacturer of a chemical compound commercially known as FlowGuard Gold. (Doc # 17, Pg. 12) LZAM sells the compound to manufacturers of chlorinated polyvinyl chloride (CPVC) plumbing pipes and fittings. (Id. ) Lubrizol Corp. is an Ohio corporation with its principal place of business in Ohio. LZAM is a Delaware corporation with its principal place of business in Ohio. (Doc # 1, Pg. 4)

Samples of the failed Eagle Pond Apartment pipes were submitted to Kent Engineering for forensic analysis. (Doc # 1, Pg. 14) The tests performed by Kent Engineering revealed: (1) that the subject CPVC pipe and fittings contained defective materials causing embrittlement; (2) the embrittlement was detrimental to the operation and maintenance of the plumbing system; (3) and the embrittlement was caused by faulty component materials manufactured and provided to the piping manufactured by LZAM. (Id. ) Neither party contests these facts.

II. ANALYSIS

A. Standard of Review

The Court will grant summary judgment if "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a) ;

*1053Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 250-57, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A fact is material if it could affect the outcome of the case based on the governing substantive law. Id. at 248, 106 S.Ct. 2505. A dispute about a material fact is genuine if, on review of the evidence, a reasonable jury could find in favor of the nonmoving party. Id.

The moving party bears the initial burden to demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the movant meets this burden, the nonmoving party must "go beyond the pleadings and ... designate specific facts showing that there is a genuine issue for trial." Id. at 324, 106 S.Ct. 2548.

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346 F. Supp. 3d 1048, Counsel Stack Legal Research, https://law.counselstack.com/opinion/crossing-at-eagle-pond-llc-v-lubrizol-corp-mied-2018.