1 UNITED STATES DISTRICT COURT 2 DISTRICT OF NEVADA 3
4 The Whiting-Turner Contracting Case No. 2:25-cv-00111-ART-DJA Company, 5 Plaintiff, ORDER ON THIRD-PARTY 6 v. DEFENDANT’S MOTION TO DISMISS (ECF NO. 21) 7 Mollerup Glass Company; Employers Mutual Casualty Company, et al., 8 Defendants. 9 Mollerup Glass Company, 10 Third-Party Plaintiff, 11 v. 12 Northwestern Industries-Arizona, Inc., 13 Third-Party Defendant. 14
15 The Third-Party Complaint at issue in this order arises out of a subcontract 16 for glass installation at a high-rise commercial office structure. (ECF No. 11.) 17 Third-Party Plaintiff Mollerup Glass Company alleges several claims arising out 18 of its agreements with Third-Party Defendant Northwestern Industries-Arizona, 19 Inc., premised on allegations of providing defective insulated glass units. Before 20 the Court is Third-Party Defendant’s Motion to Dismiss the Third-Party 21 Complaint. (ECF No. 21.) 22 I. FACTUAL AND PROCEDURAL BACKGROUND 23 The Whiting Turner Contracting Company (“Plaintiff”) serves as a 24 construction manager on a high-rise commercial office structure (“Subject 25 Property”) owned by Howard Hughes Corporation, Inc or its affiliated entities. 26 (ECF No. 1-1 at 5.) Plaintiff contracted with subcontractor Mollerup Glass 27 Company (“Mollerup”) for glass and glazing, including the installation of insulated 28 1 glass units (“IGUs”) at the Subject Property for $5,831,700. (Id.) 2 As part of its work on the Subject Property, Mollerup solicited and 3 purchased, and Northwestern Industries-Arizona, Inc. (“NWI”) manufactured and 4 provided, the IGUs for installation. (ECF No. 11 at 19.) Mollerup provided NWI 5 with project specifications and project-specific American Society for Testing and 6 Materials requirements. (Id. at 20.) NWI allegedly indicated its compliance with 7 the plans and specifications in the form of Submittals, which Mollerup provided 8 to Plaintiff. (Id.) 9 Prior to placing its order, Mollerup completed and signed NWI’s Credit 10 Application, which included its Standard Terms and Conditions (the 11 “Agreement”). (ECF No. 21-1.) When Mollerup placed its orders for the IGUs, it 12 received Order Confirmations which said that “all sales are governed by [NWI’s] 13 STANDARD TERMS AND CONDITIONS, which are incorporated herein.” (ECF No. 14 21-1 at 10-11) (emphasis in original). The purchase was also covered by NWI’s 15 Ten Year (10) Standard Limited Warranty Insulating Glass Unit (Dual Seal Unit) 16 (the “Limited Warranty”). (ECF No. 21-1 at Ex. C.) 17 The IGUs appeared to be in conformance to the plans and specifications 18 confirmed by the Submittals, the Agreement, and the Limited Warranty. (ECF No. 19 11 at 20.) The last IGUs were installed on or about May 2022. (ECF No. 1-1 at 6.) 20 On or about August 15, 2022, Plaintiff advised Mollerup of periodic IGU 21 breakages. (Id.) Mollerup then notified NWI of the breakages and demanded it 22 honor its warranties. (ECF No. 11 at 21.) NWI allegedly refused or ignored all such 23 requests. (Id.) Mollerup provided and installed select replacement IGUs at the 24 Subject Property as requested by the Plaintiff. (Id.) 25 Mollerup alleges that the breakages to that point constituted a small 26 fraction of the total number of IGUs installed. (Id.) Around February 22, 2023, 27 Plaintiff provided a notice of default to Mollerup and demanded that Mollerup 28 replace every IGU at the Subject Property (the “Total Replacement”). (Id; ECF No. 1 1-1 at 6.) Mollerup refused to undertake the Total Replacement, and 2 subsequently Plaintiff removed and replaced all the IGUs at the Subject Property 3 at its own expense, at an estimated $6,000,000. (ECF No. 1-1 at 7.) 4 On January 17, 2025, Plaintiff sued Mollerup for breach of contract, breach 5 of the implied covenant of good faith and fair dealing, breach of warranty, express 6 indemnity, equitable indemnity, implied indemnity, unjust enrichment, 7 negligence, and declaratory relief. (ECF No 1-1.) On February 25, 2025, Mollerup 8 brought its Third-Party Complaint (“TPC”) against NWI, alleging that in the event 9 that Plaintiff’s claims involve defects and damages relating to the Subject 10 Property, damages were caused by NWI as a result of its defective performance 11 under their Agreement. (ECF No. 11 at 21.) 12 NWI filed the Motion to Dismiss Mollerup’s TPC on May 9, 2025, and 13 attached copies of the Agreement and Limited Warranty (ECF Nos. 21 and 21-1.) 14 Mollerup responded (ECF No. 31) and NWI replied (ECF No. 32). 15 II. LEGAL STANDARD 16 A court may dismiss a complaint for “failure to state a claim upon which 17 relief can be granted.” Fed. R. Civ. P. 12(b)(6). A properly pled complaint must 18 provide “a short and plain statement of the claim showing that the pleader is 19 entitled to relief.” Fed. R. Civ. P. 8(a)(2); Bell Atlantic Corp. v. Twombly, 550 U.S. 20 544, 555 (2007). While Rule 8 does not require detailed factual allegations, it 21 demands more than “labels and conclusions” or a “formulaic recitation of the 22 elements of a cause of action.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing 23 Twombly, 550 U.S. at 555). “Factual allegations must be enough to rise above the 24 speculative level.” Twombly, 550 U.S. at 555. Thus, to survive a motion to 25 dismiss, a complaint must contain sufficient factual matter to “state a claim to 26 relief that is plausible on its face.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 27 U.S. at 570). Under this standard, a district court must accept as true all well- 28 1 pleaded factual allegations in the complaint and determine whether those factual 2 allegations state a plausible claim for relief. Id. at 678-79. 3 III. ANALYSIS 4 NWI moves to dismiss the TPC on the plain language of the contract, arguing 5 it excludes liability for glass breakage, does not provide for indemnity to the 6 Mollerup, and narrowly limits the scope of available damages. Mollerup argues 7 that the terms of the contract are either ambiguous or provide for remedies that 8 should be construed in its favor. 9 a. Analyzing the Claims Using Material Not Alleged in the 10 Complaint 11 Mollerup objects to NWI’s use of extrinsic evidence in its Motion to Dismiss, 12 because courts generally do not look beyond the pleadings in ruling on a Rule 13 12(b)(6) motion. United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003). It 14 claims that if the Court considers this additional material, it will convert the 15 Motion to Dismiss into one for summary judgment. See id. at 907. The 16 “incorporation by reference” doctrine offers an exception to this rule in situations 17 in which “the plaintiff’s claim depends on the contents of the document, the 18 defendant attaches the document to its motion to dismiss, and the parties do not 19 dispute the authenticity of the document, even though the plaintiff does not 20 explicitly allege the contents of that document in the complaint.” Knievel v. ESPN, 21 393 F.3d 1068, 1076 (9th Cir. 2005). 22 The contract between Mollerup and NWI forms the basis of Mollerup’s 23 claims. Mollerup’s claim for express indemnity alleges that NWI “entered into one 24 or more written agreements” with Mollerup (ECF No. 11 at 22), its breach of 25 contract claim relies on the “terms of said agreements” (Id.), and its breach of 26 express warranty that “written agreements . . . provide . . . the guarantee and 27 warranty of said products” (Id. at 24). The resolution of those claims turns on the 28 language of the agreements that are provided by Defendant in its Motion to 1 Dismiss. See Clifford v. Geico Casualty Co., 428 F. Supp. 3d 317, 322 (D. Nev. 2 2019). Mollerup does not dispute the authenticity of the documents that 3 Defendant cites in its brief and goes on to quote the language of their agreement 4 in support of its claims. (ECF No. 31 at 12.) Therefore, the Court can properly 5 consider these materials without converting the Motion to Dismiss into one for 6 summary judgment. 7 b. Breach of Contract 8 In its TPC, Mollerup identifies two possible breaches: first, NWI failed to 9 insure and indemnify Mollerup, and second, that it failed to provided its products 10 and materials and performing its work in a good and workmanlike manner. (ECF 11 No. 11 at 23.) Defendant alleges that Mollerup fails to state a claim for breach of 12 contract because the contract does not include any insurance or indemnification 13 provisions, does not warrant against defect resulting in glass breakage, and 14 strictly limits liability and damages. (ECF No. 32 at 9-10.) 15 Under Nevada law, to show a breach of contract a plaintiff must show “(1) 16 the existence of a valid contract, (2) a breach by the defendant, and (3) damage 17 as a result of the breach.” Keife v. Metro. Life Ins. Co., 797 F. Supp. 2d 1072 (D. 18 Nev. 2011) (citing Saini v. Int’l Game Tech., 434 F.Supp.2d 913, 919-920 (D. Nev. 19 2006). Neither party disputes the existence of a valid contract, or the validity of 20 Exhibit A as accurately representing an agreement between the parties. (ECF No. 21 21-1.) 22 i. Breach 23 To determine a breach, the Court looks to whether a party “fail[ed] to 24 perform [its] obligations within the express terms of an agreement.” Creative 25 Surfaces, Inc. v. Swonger, 2:17-cv-2494-JCM-VCF, 2018 WL 4279225 at *3 (D. 26 Nev. Jun. 19, 2018) (citing Saini v. Int’l Game Tech., 434 F. Supp. 2d 913, 923 27 (D. Nev. 2006)). “A party cannot breach an obligation that was not in the 28 contract.” Id. When a contract is ambiguous, courts construe ambiguities against 1 the drafter. Dickenson v. State, Dept. of Wildlife, 877 P.2d 1059, 1061 (Nev. 1994). 2 A contract is ambiguous where it is “reasonably susceptible to more than one 3 interpretation.” Oracle USA, Inc. v. Rimini Street, Inc., 6 F. Supp. 3d 1086, 1094 4 (D. Nev. 2014) (citing Shelton v. Shelton, 78 P.3d 507, 510 (Nev. 2003)). “An 5 interpretation which results in a fair and reasonable contract is preferable to one 6 that results in a harsh and unreasonable contract.” Id. “An interpretation is not 7 reasonable if it makes any contract provisions meaningless, or if it leads to an 8 absurd result.” Nevada State Ed. Ass’n v. Clark Cnty. Ed. Ass’n, 482 P.3d 665, 9 673 (Nev. 2021) (citing Washoe Cty. Sch. Dist. v. White, 396 P.3d 834, 839 (2017)). 10 a. Indemnity and Insurance 11 NWI argues that it has no duty under the terms of the contract to defend 12 or indemnify Mollerup for the cost of replacing the IGU’s. Mollerup does not cite 13 the portion of the contract that states that NWI owes a duty to maintain liability 14 insurance, indemnify, or defend Mollerup. 15 NWI argues that all obligations between the parties are defined by the 16 contract, as established by section 19. (ECF No. 21-1 at 8.) Section 13 of the 17 Agreement requires Mollerup to indemnify, defend, and hold harmless the NWI 18 for any claims related to its products. (ECF No. 21-1 at 8) (Mollerup “shall 19 indemnify, defend, and hold NWI-AZ . . . against and hold them harmless from 20 any and all claims, actions, suits, procedures, costs, expenses, damages, losses 21 and liabilities, including any actual attorney’s fees and costs arising out of, 22 connected with, or resulting from any of NWI-AZ’s products following their 23 shipment . . .”) 24 The Court agrees with NWI that the Agreement does not require it to 25 maintain liability insurance for, indemnify, nor defendant Mollerup. Accordingly, 26 Mollerup fails to state a breach of contract claim on that basis. 27 28 1 b. Warranty 2 Mollerup also alleges that NWI breached its warranty against defects by 3 supplying defective IGUs. (Id. at 21.) It incorporates the allegations from the 4 original Complaint that claim the subcontract was breached “by supplying or 5 installing defective IGUs.” (ECF No. 31 at 10, citing ECF No. 1-1 at 34.) The 6 alleged warranty is premised on the Section 10 of the Agreement and the Limited 7 Warranty. The Agreement states that “products sold by NWI-AZ are warranted to 8 be free from manufacturing defects for one (1) year from date of shipment to 9 Buyer.” (ECF No. 21-1 at 7.) The Limited Warranty states that NWI “warrants for 10 a period of TEN (10) years from date of manufacture and under normal condition, 11 the insulated glass shall be free of material and workmanship defects.” (ECF No. 12 21-1 at 13.) 13 The parties dispute, however, whether the contents of the Agreement and 14 the Limited Warranty disclaim warranties against glass breakage, and to what 15 extent. Section 10, clauses (b) and (e) of the Terms and Conditions purport to 16 disclaim warranties for failure of the product due to glass breakage or glass 17 breakage of any kind: 18 WARRANTY. THERE ARE NO EXPRESS WARRANTIES EXCEPT AS SET 19 FORTH IN THESE TERMS AND CONDITIONS AND NWI-AZ EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, WITH REGARDS TO PRODUCTS 20 SOLD BY NWI-AZ, WHETHER EXPRESS, IMPLIED, OR STATUTORY, 21 INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Unless otherwise limited or extended by NWI-AZ 22 in writing, products sold by NWI-AZ are warranted to be free from 23 manufacturing defects for one (1) year from date of shipment to Buyer. The sole obligation of NWI-AZ under this warranty is to repair, or at its option, 24 replace, defectively manufactured product(s) without charge to Buyer 25 within the warranty period. No other remedies are available. NO WARRANTY IS MADE BY NWI-AZ WITH RESPECT TO: (a) Defectively 26 manufactured product(s), notice of which is not provided within the 27 applicable warranty period; (b) Failure of the product(s) due to . . . glass 28 1 workmanship of the relevant product(s); . . . (e) Glass breakage of any kind. 2 (capitalization in original) (ECF No. 21-1 at 8.) The Limited Warranty, which 3 warrants against defects, also states: “NWI-AZ will have no liability under this 4 Warranty, if any of the following events have occurred: Glass breakage, product 5 failure due to improper usage . . .” (ECF No. 21-1- at 13.) 6 NWI argues that it is not liable for glass breakage, even due to defect. 7 Specifically, NWI argues that clauses (b) and (e) of section 10 disclaiming 8 warranties for “failure of the product[s] due to . . . glass breakage” and “[g]lass 9 breakage of any kind” respectively should be interpreted to mean that regardless 10 of manufacturing defect, it cannot be held liable if glass breaks. (ECF No. 32 at 11 9-10.) It also claims that the clause exempting it from liability for “[g]lass 12 breakage, product failure due to improper usage . . .” should be read as two 13 separate clauses, indicating that it will not be liable for any glass breakage. (Id.) 14 Mollerup argues that the glass breakage exclusions do not apply to defects, 15 relying on conditional language in section 10(b) and the Limited Warranty that 16 affects the definition of “glass breakage.” Section 10(b) concludes with the phrase, 17 “or any reason not related to defects in material or workmanship of the relevant 18 products.” (ECF No. 31 at 12.) This suggests that glass breakage due to defect is 19 warranted. This interpretation is reinforced by the Limited Warranty, which also 20 applies to defective IGU’s but disclaims liability for “Glass breakage, product 21 failure due to improper usage.” (Id.) While Third Party Defendant argues this 22 phrase could be interpreted to exclude all glass breakage, Third Party Plaintiff 23 plausibly alleges that these provisions support an interpretation that the 24 warranty applies to defects, including “glass breakage,” but does not apply to 25 glass breakage due to other causes, including improper handling, installation, 26 loading, etc. 27 28 1 The Court finds that Mollerup at a minimum has plausibly alleged that 2 there is an ambiguity as to what kind of glass breakage the warranty disclaimer 3 addresses, such that Defendant might have breached the contract. There is more 4 than one reasonable interpretation of the contractual warranties provided in the 5 Agreement and Limited Warranty. 6 ii. Damages 7 NWI argues that Mollerup’s alleged damages are not recoverable under the 8 terms of their agreement, pointing to a sectionof the Agreement titled 9 “LIMITATIONS ON NWI-AZ’s LIABILITY.” (ECF No. 21 at 13) (capitalization in 10 original). Third-Party Plaintiff maintains that it states a claim because the 11 Agreement does not preclude or is ambiguous as to the limitations on NWI’s 12 liability for damages. 13 “Damages for a breach of contract claim are limited to those specifically 14 outlined in the contract, if any, and those expectation damages sufficient to put 15 the non-breaching party in the position it would have been had the breach not 16 occurred.” Shaw v. CitiMortgage, Inc., 201 F.Supp.3d 1222, 1249 (D. Nev. 2016). 17 Mollerup seeks actual damages for the IGUs it replaced, attorney’s fees, and the 18 potential damages that may result from the original Complaint. (ECF No. 31 at 19 16-17.) It points to a choice of remedies in the Agreement that allow for “the 20 reasonable cost of repairing and replacing the defective products.” (Id. at 17-18.) 21 NWI argues that none of Mollerup’s proposed damages are recoverable under the 22 Agreements, since its actual and potential liability was incurred by “removing and 23 reinstalling” IGUs. (ECF No. 21 at 13.) The Agreement disclaims liability for “the 24 cost of removing and reinstalling” as well as disclaiming “indirect, consequential, 25 special, economic, incidental, or punitive damages.” (Id.) Therefore, NWI argues, 26 there is no viable path to the damages that Mollerup claims in the TPC. 27 The Agreement acknowledges that NWI may incur liability for “repairing or 28 replacing” but not “removing or reinstalling” defective IGUs. Section 10 (titled 1 “WARRANTY”) of the Terms and Conditions in the Agreement concludes, “[a]ny 2 liability of NWI-AZ to Buyer . . . shall be limited to NWI-AZ’s choice of any one of 3 the following: (a) the repair of the defective products by NWI-AZ; (b) the delivery 4 of non-defective and conforming product to BUYER or to BUYER’s customer; (c) 5 the payment by NWI-AZ to Buyer of the reasonable cost of repairing or replacing 6 the defective products, but not the cost of removing or reinstalling the products; 7 or (c) [sic] the cancellation of the contract, Buyer’s return of the products in 8 question to NWI-AZ, and NWI-AZ’s refund of the purchase price to buyer.” 9 Similarly, section 11 of the Terms and Conditions in the Agreement 10 disclaims liability for the cost of removing or reinstalling defective or 11 nonconforming products, while limiting other forms of damages: 12 LIMITATIONS ON NWI-AZ’S LIABILITY. NWI-AZ shall not, under any 13 circumstances, even if advised of the possibility of such damages, be liable to BUYER or BUYER’s customer for indirect, consequential, special, 14 economic, incidental, or punitive damages whether the damages were 15 foreseeable or arise out of tort, strict liability, products liability, or any other legal theory, except as precluded by law. Without limiting the 16 generality of the preceding, NWI-AZ’S [sic] shall not be liable for: loss of or 17 damage to other property, lost profits or revenue, damage to reputation, the labor and material cost of removing or reinstalling defective or 18 nonconforming products, or damages caused by delays, back-charges, or 19 loss of use. 20 (ECF No. 21-1 at 8.) This limitation does not extend to “repairing or replacing.” 21 Then, the Limited Warranty states that NWI warrants for a period of ten years 22 “the insulated glass units shall be free from material and workmanship defects” 23 and that it will incur liability for “replacing [defective] insulated glass unit[s] 24 without charge F.O.B. nearest shipping point of NWI-AZ to place of original 25 delivery, or in the alternative, a refund of 100% of NWI-AZ original selling price 26 for such insulated glass product.” (Id. at 13.) 27 Mollerup alleged damages already incurred replacing defective IGUs and 28 potential liability for the Total Replacement of IGUs that WTCC is litigating in the 1 original Complaint. (ECF No. 11 at 20-21.) Because the Agreement acknowledges 2 that NWI can be liable for “replacing” defective glass units, Mollerup has stated a 3 cognizable claim for damages. 4 iii. Causation 5 Having established that their Agreement does not unambiguously disclaim 6 warranties against all glass breakage nor completely limit Mollerup’s remedies, 7 the Court turns to the element of causation. Mollerup alleges that despite timely 8 and repeated notice to NWI of the breakages and presumed defects in the glass, 9 as per requested in the Agreement, NWI did not respond or provide any of the 10 remedies it said it could elect as an option as described in its warranties. (ECF 11 No. 11 at 21.) NWI does not contest that it did not respond to Mollerup’s requests. 12 As a result of its failure to provide replacement IGUs, Mollerup incurred the cost 13 of replacing select IGUs, and now faces the original lawsuit at issue. Therefore, 14 Mollerup has sufficiently stated a breach of contract at this stage. 15 a. Breach of Express Warranty 16 Mollerup’s allegations under breach of express warranty are the same as 17 its arguments under breach of contract. To bring a breach of express warranty 18 claim under Nevada law, a plaintiff must demonstrate “(1) a warranty existed; (2) 19 defendant breached the warranty; and (3) the breach was the proximate cause of 20 the loss sustained by the plaintiff.” Underwood v. O’Reilly Auto Parts, Inc., 671 21 F.Supp.3d 1180, 1191 (D. Nev. 2023) (citing Nevada Contract Servs., Inc. v. 22 Squirrel Cos. Inc., 68 P.3d 896, 899 (Nev. 2003)). “Courts in Nevada have held 23 that general contract-interpretation principles govern the interpretation of 24 express warranties, and unambiguous contracts must be construed according to 25 their plain language.” RSO Corporation v. Navistar, Inc., 796 F.Supp.3d 678, 681 26 (D. Nev. 2025) (internal citation omitted). “Exclusions of warranties are generally 27 disfavored, and standardized take it or leave it form contracts . . . are construed 28 1 against the drafter.” Sierra Diesel Injection Service, Inc. v. Burroughs Corp., Inc., 2 890 F.2d 108, 114 (9th Cir. 1989) (construing Nevada law). 3 Mollerup’s breach of express warranty claim is based on the same 4 allegations as its breach of contract claim. Mollerup identifies an express 5 warranty that the IGUs would be “free from manufacturing defects” and “free from 6 of material and workmanship defects” (ECF No. 21-1 at 7, 13.) It alleges that the 7 IGUs shattered because they were defective, a breach of the warranty. (ECF No. 8 11 at 21.) And it alleges that as a result of the IGUs shattering, it was required to 9 replace and reinstall new IGUs at its own cost. (Id.) Having previously identified 10 that the Agreement and Limited Warranty pose ambiguities that should be 11 construed in favor of the non-drafting party, the Court finds that Mollerup has 12 stated a claim for breach of express warranty. 13 b. Breach of Implied Covenant of Good Faith and Fair Dealing 14 NWI argues that Mollerup’s claim for breach of the implied covenant of good 15 faith and fair dealing inherently relies on the same conduct as its breach of 16 contract claim, the provision of allegedly defective IGUs, and therefore fails under 17 Nevada law. Mollerup counters that it can plead for breach of the implied 18 covenant in the alternative. 19 In Nevada, every contract implies the covenant of good faith and fair 20 dealing. Virgin Valley Water District v. Paradise Canyon, LLC, 567 P.3d 962, 972 21 (Nev. 2025). A contractual breach of the implied covenant of good faith and fair 22 dealing occurs “[w]here the terms of a contract are literally complied with but one 23 party to the contract deliberately countervenes [sic] the intention and spirit of the 24 contract.” Hilton Hotels Corp. v. Butch Lewis Prods., Inc., 808 P.2d 919, 922-23 25 (Nev. 1991). “To state a claim for breach of the implied covenant of good faith and 26 fair dealing, a plaintiff must allege (1) plaintiff and defendant were parties to a 27 contract; (2) defendant owed a duty of good faith the plaintiff; (3) defendant 28 breached that duty by performing in a manner that was unfaithful to the purpose 1 of the contract; and (4) plaintiff's justified expectations were denied.” Arminas 2 Wagner Enterprises, Inc. v. Ohio Sec. Ins. Co., 658 F. Supp. 3d 883, 892 (D. Nev. 3 2023) (citing Hilton Hotels Corp., 808 P.2d at 922). Whether a party acted in good 4 faith is a question of fact. Mitchell v. Bailey and Selover, Inc., 605 P.2d 1138, 1139 5 (Nev. 1980). “It is well established that a claim alleging breach of the implied 6 covenants of good faith and fair dealing cannot be based on the same conduct 7 establishing a separately pled breach of contract claim.” Jimenez v. GEICO Gen. 8 Ins. Co., 448 F. Supp. 3d 1108, 1113 (D. Nev. 2020) (internal citation omitted). 9 In the TPC, Mollerup alleges that if the IGUs are considered defectively 10 designed, developed, and/or constructed, then NWI breached the implied 11 covenant. (ECF No. 11 at 29.) This allegation constitutes the same facts behind 12 its claims for breach of contract and breach of express warranty. In its opposition, 13 Mollerup clarifies that to the extent that NWI has “technically complied with the 14 contract by refusing to warrant breakages,” it contravened the intention and 15 spirit of the contract because it simultaneously provided an express warranty 16 against defective products. (ECF No. 31 at 20.) This is a dispute about the 17 interpretation of a contractual term, not the bad faith performance of NWI. 18 Therefore, Mollerup’s claim for breach of the implied covenant of good faith and 19 fair dealing is dismissed without prejudice and with leave to amend. 20 c. Implied Warranties 21 NWI also argues that Mollerup’s claim for implied warranty is directly 22 contradicted by unambiguous terms of the agreement, therefore rendering its 23 claim for implied warranty unsuccessful. (ECF No. 21 at 16.) Mollerup argues 24 that Nevada recognizes implied warranties on the sale of goods that includes that 25 the product is fit for ordinary purpose of which such goods are used. (ECF No. 26 31 at 19.) 27 Nevada law allows a seller to limit or exclude implied warranties of 28 merchantability so long as the writing is conspicuous. NRS 104.2316(2). NWI 1 explicitly excluded the implied warranty of merchantability in the Terms, writing, 2 in all caps, “NWI-AZ expressly disclaims all other warranties, with regards to 3 products sold by NWI-AZ, whether express, implied, or statutory, including any 4 warranty of merchantability or fitness for a particular purpose.” (ECF No. 21-1 at 5 7.) This is conspicuous and unambiguous, and Mollerup makes no argument 6 addressing the plain text. Therefore, Mollerup’s claim under the breach of the 7 implied warranty of merchantability or fitness for a particular purpose is 8 dismissed. 9 d. Negligence 10 In its Complaint, Mollerup argues that NWI negligently manufactured the 11 IGUs and was damaged in the form of exposure to potential liability as well as 12 costs, expenses, and attorney’s fees incurred in the preparation and presentation 13 of its defense of the WTCC lawsuit. (ECF No. 11 at 28-29.) Mollerup argues that 14 because WTCC also mentioned health and safety issues for tenants that risked 15 personal injury, the damages are not purely based on economic loss. (ECF No. 31 16 at 23.) NWI argues that the economic loss doctrine bars this claim, because 17 WTCC’s requested damages are related to the removal, repair, and replacement 18 of IGUs in connection with the Total Replacement, as well as other economic 19 losses, such as attorneys’ fees and costs, investigative costs, and prejudgment 20 interest. (ECF No. 21 at 18-19.) The mentions of personal injury in the WTCC 21 only refers to “potential” for injury or “potentially dangerous” conditions. (ECF 22 No. 32 at 14.) 23 To state a claim for negligence, a plaintiff must allege: (1) the existence of 24 a duty of care, (2) breach of that duty, (3) legal causation, and (4) damages. 25 Sanchez ex rel. Sanchez v. Wal-Mart Stores, Inc., 221 P.3d 1276, 1280 (Nev. 2009). 26 While the tort of negligence can be committed by parties to a contract, the alleged 27 breach must be of a duty imposed by law independent of any contractual duty. 28 Contreras v. Am. Fam. Mut. Ins. Co., 135 F. Supp. 3d 1208, 1220 (D. Nev. 2015). 1 In Nevada, the economic loss doctrine also bars unintentional tort claims when 2 a plaintiff seeks to recover purely economic losses. Peri & Sons Farms, Inc. v. Jain 3 Irr., Inc., 933 F.Supp.2d 1279, 1283 (D. Nev. 2013) (internal citation omitted). 4 “Purely economic loss has been defined as the loss of the benefit of the user's 5 bargain ... including ... pecuniary damage for inadequate value, the cost of repair 6 and replacement of the defective product, or consequent loss of profits, without 7 any claim of personal injury or damage to other property.” Id. (internal citation 8 omitted). 9 Whether in its TPC or Plaintiff’s original Complaint, Mollerup does not cite 10 to an actual personal injury to individuals at the property nor property damage 11 beyond the allegedly defective product. There is no “imminent-threat-of-harm 12 theory” that qualifies for an exception to the economic loss doctrine under Nevada 13 law. Nevada Power Company v. Trench France, S.A.S., No. 2:19-cv-01252-JAD- 14 VAF, 2020 WL 6689340 at *3 (D. Nev. Nov. 12, 2020) (holding that “[e]xpanding 15 tort recovery to include economic losses based on a foreseeable risk of harm . . . 16 would essentially nullify the economic loss doctrine entirely . . .”). Additionally, 17 the Court agrees with NWI that WTCC’s allegation that the IGUs “creat[ed] 18 property damage” is insufficiently pled. See Nevada Power Co. v. Trench France 19 S.A.S., No. 2:15-cv-264-JCM-NJK, 2016 WL 309337 at *2 (D. Nev. Jun. 1, 2016) 20 (vague description of “substantial damage” insufficient to put the opposing party 21 on notice of claim for negligence). 22 Therefore, Mollerup’s negligence claim is barred by the economic loss 23 doctrine and is dismissed. 24 e. Express Indemnity 25 NWI argues there is no contractual provision under which Mollerup could 26 base a claim for express indemnity, because the only indemnification agreement 27 says that Mollerup will indemnify NWI. (ECF No. 21-1 at 8.) Mollerup does not 28 dispute this conclusion in its response. (ECF No. 31 at 20.) “[C]ontractual 1 indemnity is where, pursuant to a contractual provision, two parties agree that 2 one party will reimburse the other party for liability resulting from the former's 3 work.” United Rentals Hwy. Techs. v. Wells Cargo, 289 P.3d 221, 226 (Nev. 2012). 4 Indemnification agreements are “strictly construed and will not be held to provide 5 indemnification unless it is so stated in clear and unequivocal language.” Casun 6 Invest, A.G. v. Ponder, No. 2:16-cv-2925, 2020 WL 59812 at *4 (D. Nev Jan. 6, 7 2020) (citing George L. Brown Ins. v. Star Ins. Co., 237 P.3d 92, 96 (Nev. 2010)). 8 Because there is no contractual provision granting indemnity to Mollerup within 9 the express indemnity provision of the Agreement, its claim for express indemnity 10 is dismissed. 11 f. Equitable Indemnity 12 The Supreme Court of Nevada has held that “implied indemnity theories 13 are not viable in the face of express indemnity agreements.” FDIC v. Nev. Title. 14 Co., 2014 WL 4798523 at *4 (D. Nev. Sept. 25, 2014) (citing Calloway v. City of 15 Reno, 939 P.2d 1020, 1029 (Nev. 1997) opinion withdrawn on grant of reh'g, 971 16 P.2d 1250 (1998); see also Wells Cargo, 289 P.3d at 226 (“When the duty to 17 indemnify arises from contractual language, it generally is not subject to 18 equitable considerations; rather it is enforced in accordance with the terms of the 19 contracting parties' agreement.”) (internal quotes omitted). To plead implied 20 indemnity, Mollerup must allege that “(1) it has discharged a legal obligation owed 21 to a third party; (2) the party from whom it seeks liability was also liable to the 22 third party; (3) as between the claimant and the party from whom it seeks 23 indemnity, the obligation ought to be discharged by the latter.” Rodriguez v. 24 Primadonna Co., LLC, 216 P.3d 793, 801 (Nev. 2009). 25 Because the Agreement contains an express indemnity provision that 26 benefits only NWI, Mollerup’s theory of implied indemnity is not available. 27 Therefore, Mollerup’s claim is dismissed. 28 1 g. Contribution and Apportionment 2 Mollerup argues that it is not responsible for the damages or defects alleged 3 by WTCC in the original Complaint, and any liability found on its end is due to 4 the negligence or fault of NWI. (ECF No. 11 at 27.) Therefore, Mollerup argues 5 that it would be entitled to contribution over and against NWI for all such 6 amounts that the trier of fact may determine were the result of acts or omissions 7 of NWI, as well as costs, expenses, and attorney’s fees. (Id.) Mollerup similarly 8 argues that if WTCC should recover judgment against it, then it will be entitled 9 to apportionment against NWI for its negligence and fault. (ECF No. 11 at 28.) 10 Contribution and apportionment are both causes of action that sound in 11 tort, not contract. N.R.S. § 17.225 (“The right of contribution exists only in favor 12 of a tortfeasor who has paid more than his or her equitable share of the common 13 liability”); see Halcrow, Inc. v. Eighth Jud. Dist. Ct., 302 P.3d 1148, 1154 n.4 (Nev. 14 2013) (finding that contribution and apportionment were not available where 15 defendant was not found to be a joint tortfeasor). Having dismissed Mollerup’s 16 negligence claim under the economic loss doctrine, it has no surviving claims of 17 tort under which Mollerup and NWI could share liability requiring contribution 18 and apportionment. Therefore, Mollerup’s claims for contribution and 19 apportionment are dismissed. 20 h. Declaratory Relief 21 To plead a claim for declaratory relief, Mollerup must allege “(1) a justiciable 22 controversy exists between persons with adverse interests, (2) the party seeking 23 declaratory relief has a legally protectable interest in the controversy, and (3) the 24 issue is ripe for judicial determination.” Cnty. of Clark, ex rel. Univ. Med. Ctr. V. 25 Upchurch, 961 P.2d 754, 757 (Nev. 1998). 26 Mollerup requests declaratory relief that NWI owes Mollerup a duty to 27 defend and a duty to name Mollerup as an additional insured. As stated in the 28 analysis of breach of contract, NWI does not owe Mollerup this duty. Mollerup 1 || also requests declaratory relief that NWI owes Mollerup a duty to indemnify. As 2 || stated in the analysis of express and implied indemnity, the Court follows the 3 || express terms of the contract, which only indemnifies NWI in the case of loss. 4 Therefore, Mollerup’s claims for declaratory relief are dismissed. 5 IV. Conclusion 6 It is therefore ordered the Court GRANTS IN PART NWI’s Motion to Dismiss 7 || (ECF No. 21) as to Mollerup’s claims for breach of implied covenant of good faith 8 || and fair dealing, breach of implied warranty, express and implied indemnity, 9 || negligence, contribution, apportionment, and declaratory relief without prejudice 10 || and with leave to amend. 11 It is further ordered that the Court DENIES NWI’s Motion to Dismiss (ECF 12 || No. 21) as to Mollerup’s claims for breach of contract and breach of express 13 || warranty. 14 15 DATED THIS 234 day of January, 2026. 16 17 Ans lossd Jer 18 ANNE R. TRAUM 19 UNITED STATES DISTRICT JUDGE 20 21 22 23 24 25 26 27 28