FORT MYERS – The U.S. District Court for the Middle District of Florida, Fort Myers Division, recently granted a boat manufacturer's motion to dismiss claims of negligence in an insurance company’s lawsuit alleging a defect caused a boat to sink, but the case will continue as their motions to dismiss claims of warranty breaches were denied.
U.S. District Judge John E. Steele issued the order on May 23 to grant a motion by Brunswick Corp., d.b.a. Sea Ray Boats, to dismiss claims of negligence and denied the motions to dismiss claims of express and implied warranty breach.
Atlantic Specialty Insurance Co. sued Brunswick for a boat they manufactured and sold to Atlantic’s insured, Joseph Campbell, that Atlantic claims sunk after catching on fire due to Brunswick’s faulty Zeus pods.
In 2016, Campbell was driving his Sea Ray off the coast of Naples when the boat ran aground, court documents said. When he tried to move the boat, the Zeus pods “failed to sheer, causing the vessel to sink." Sea Tow Naples, a company operating under Mercier Marine Enterprise LLC, used a pump to keep the boat from taking on more water in a salvage attempt when fuel from the pump leaked onto the boat, causing the vessel to catch fire. Atlantic paid Campbell $936,622, the agreed upon value of the boat, court documents said.
Atlantic sued Brunswick to recover the amount it paid to Campbell, claiming negligence and product liability for the defective Zeus pods. Court documents said Brunswick owed Atlantic and their insured “a duty to construct, design, formulate, install, prepare and assemble a safe vessel.” Atlantic also claimed breaches of implied warranty for merchantability and express warranty, noting that Brunswick had a duty to provide a boat free of defects, and breach of implied warranty of fitness for a particular purpose.
Brunswick moved to dismiss all claims against it, arguing that Atlantic’s “negligence claim is barred by the economic loss rule,” the court filing said. Brunswick also claimed that Atlantic has not adequately pleaded privity, failing to state causes of action for breach of express and implied warranties.
The motion to dismiss the claims of breach of express warranty and breach of implied warranty were dismissed. Steele noted that Atlantic had established privity as Campbell purchased a boat from Brunswick who “issued an express warranty to Campbell.”
Steele granted the motion to dismiss Atlantic’s claims for negligence, agreeing with Brunswick that the claims are “barred by the economic loss rule, noting “federal maritime law does not permit recovery in tort for such purely economic loss.” The order dismissed the negligence claim without prejudice, giving Atlantic 30 days to amend their complaint.
United States District Court Middle District of Florida, Fort Myers Division, Case Number 2:18-cv-93-FtM-29CM