Thompson v. Budd Co.

199 F.3d 799
CourtCourt of Appeals for the Sixth Circuit
DecidedDecember 9, 1999
DocketNos. 99-5518, 99-5585, 99-5613
StatusPublished
Cited by13 cases

This text of 199 F.3d 799 (Thompson v. Budd Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thompson v. Budd Co., 199 F.3d 799 (6th Cir. 1999).

Opinion

OPINION

WISEMAN, District Judge.

Anthony Thompson (“Thompson”), a Merrick Mechanical, Inc. (“Merrick”) employee, sustained serious injuries while working at The Budd Company’s (“Budd”) Shelbyville, Kentucky manufacturing plant. Thompson sued Budd alleging common law tort claims. The district court entered summary judgment for Budd, finding that Budd qualified as a “contractor” under Kentucky Workers’ Compensation law and that Budd was immune from liability. Thompson appeals the district court’s decision that Budd is a “contractor.”

Stemming from the same set of events, Budd brought common law indemnification claims against Barton-Malow Company, [803]*803Inc. (“Barton”) and Albert Kahn Associates, Inc. (“Kahn”) and brought contractual indemnity claims against Barton and Merrick. The district court noted that without legal liability there can be no indemnification. Because Budd was not liable to Thompson, the district court dismissed the common law and contractual indemnification claims. Budd appeals.

We find that Budd is a contractor under Kentucky’s Workers’ Compensation system and AFFIRM the district court’s summary judgment against Thompson. Because we find that contractual indemnification, unlike common law indemnification, does not require legal liability to a third party, we REVERSE in part the district court’s entry of summary judgment against Budd.

I. FACTUAL AND PROCEDURAL BACKGROUND

Anthony Thompson was an employee of Merrick Mechanical, Inc. Merrick had contracted with The Budd Company to maintain Budd’s heating, ventilation, and air conditioning (“HVAC”) system. In November 1995, Thompson was working at Budd’s automobile part stamping plant. The plant contained a mezzanine level electrical substation. This substation was a restricted area; it remained locked to ensure limited access. Within this area was a set of double doors which opened to the plant floor — sixteen feet below the mezzanine level.

Chuck Cummings (“Cummings”), another Merrick employee, was generally responsible for maintaining Budd’s HVAC system. The day prior to Thompson’s injury, Cummings had requested and received Thompson’s aid in changing filters and filter frames. Thompson also helped Cummings the next morning. When they ran out of filters, Cummings and Thompson went to obtain more. The filters were stored in the mezzanine level electrical substation. Cummings unlocked the substation entrance giving Thompson access to the substation. Thompson was unfamiliar with the area and the plant design. While searching for the stored filters, Thompson opened the double doors and fell sixteen feet to the plant floor. Injuries resulting from the fall left him a paraplegic. Since then Thompson has received workers compensation payments through Merrick.

Anthony Thompson originally filed a negligence claim in the Shelby Circuit Court of Kentucky on 19 March 1996. Thompson sued Budd for failing to provide a safe working environment. On the basis of diversity jurisdiction, Budd removed the case to the United States District Court for the Eastern District of Kentucky, Frankfort Division, on 16 April 1996. Thereafter, Thompson amended the complaint to include as defendants Barton, who constructed the facility, and Kahn, who provided engineering and consulting services to Barton. Thompson alleged that Barton and Kahn failed to design and construct a safe working environment that complied with all applicable laws and regulations. Budd filed cross claims against Barton, Kahn, and Merrick.

In March of 1997, Budd filed a Motion for Summary Judgment against Thompson. After oral argument on this motion in July, 1997, the district court granted Budd’s motion for summary judgment. Thompson filed a notice of appeal to this court on 18 August 1997. Finding that the order entering judgment against Thompson was not final because of Budd’s pending indemnity claims, this Court dismissed the appeal for lack of jurisdiction.

On remand the district court entered a final order dismissing Budd’s claims for indemnity against Barton, Kahn, and Merrick. Thereafter, Thompson, Budd, and intervening plaintiff Liberty Mutual Insurance Company filed notices of appeal to this Court.

On 18 July 1997, Thompson entered into a settlement agreement with Barton and Kahn which resolved Thompson’s claims against these two defendants. In accor[804]*804dance with the settlement agreement, Thompson agreed to defend Barton and Kahn against Budd’s remaining claims.

II. DISCUSSION

We review de novo the district court’s grant or denial of summary judgment. See DePiero v. City of Macedonia, 180 F.3d 770, 776 (6th Cir.1999). We, thus, consider whether there are any issues of material fact and, if not, whether Budd is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c); DePiero, 180 F.3d at 776. Additionally, in reviewing summary judgment decisions we view the factual evidence and draw all reasonable inferences in favor of the nonmoving party. Id. (citing Matsushita Elec. Indus, v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986)). The district court ultimately dismissed Budd’s indemnity claims for failure to state a claim. Since the court considered affidavits and matters outside the pleadings, the dismissal is treated as a summary judgment. See Fed.R.Civ.P. 12(c).

The lynchpin of the district court’s resolution of this case is the holding that Kentucky Workers’ Compensation law immunizes Budd from liability for Thompson’s injuries. We, therefore, first address Budd’s argument that Kentucky’s Workers’ Compensation system shields it from Thompson’s common law tort claims. Only after addressing this issue can we address Budd’s various claims for summary judgment.

A. Kentucky Workers’ Compensation and Immunity from Common Law Tort

Analysis of Budd’s motion for summary judgment depends on the meaning of two provisions of the Kentucky Workers’ Compensation law. See Ky.Rev.Stat. Ann. §§ 342.610(2)(b) and 342.690(1) (Banks-Baldwin 1997). Section 342.610(2)(b) defines “contractor” as a “person who contracts with another ... [t]o have work performed of a kind which is a regular or recurrent part of the work of the trade, business, occupation, or profession of such person.” Section 342.690(1) provides in relevant part;

If an employer secures payment of compensation as required by this chapter, the liability of such employer under this chapter shall be exclusive and in place of all other liability of such employer to the employee ... and anyone otherwise entitled to recover damages from such employer at law or in admiralty on account of such injury or death. For purposes of this section, the term “employer” shall include a “contractor” covered by subsection 2 of KRS 342.610, whether or not the subcontractor has in fact, secured the payment of compensation.

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199 F.3d 799, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thompson-v-budd-co-ca6-1999.