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Marine Power Holdings, LLC v. Malibu Boats, LLC

United States District Court, E.D. Louisiana

November 5, 2014

MARINE POWER HOLDINGS, LLC,
v.
MALIBU BOATS, LLC., Section

ORDER AND REASONS

MARTIN L. C. FELDMAN, District Judge.

Before the Court is the defendant's motion, pursuant to Federal Rule of Civil procedure 13(a)(1) and the rule against claim splitting, to dismiss this case or to transfer it to the Eastern District of Tennessee for potential consolidation with two previously filed lawsuits between the parties. For the reasons that follow, the motion is DENIED WITHOUT PREJUDICE.

Background

Marine Power is a Louisiana company that designs, manufactures, and sells engines for sport boats. Malibu is a Tennessee and Delaware company that manufactures and sells sport boats. In 2013, Marine Power and Malibu entered into an agreement for Malibu to purchase engines for its boats from Marine Power.

There are currently three lawsuits pending between Marine Power and Malibu. The first two concern a purchase order (557 PO) for 571 engines, and the third concerns a warranty on LS3 engines. The purchase order was not for LS3 engines.

First, on April 15 of this year, Malibu filed suit against Marine Power in the Eastern District of Tennessee (3:14-cv-152). Malibu sought a declaratory judgment on its purported cancellation of the 557 Purchase Order. Then, on April 22, Marine Power filed suit against Malibu in this district (2:14-cv-912). Both of these lawsuits concerned the 557 Purchase Order, and Judge Africk transferred the second case to the Eastern District of Tennessee under the "first to file" rule. He found that the two cases might substantially overlap, requiring transfer. He also noted that he expressed no opinion as to which case should proceed or as to where venue was proper.

In the Eastern District of Tennessee, this second case (now 3:14-cv-242) was assigned to the same judge as the first, but the cases have not been consolidated.

Pending in the first lawsuit are four motions:

(1) Motion to enjoin Marine Power from maintaining a laterfiled lawsuit in the Eastern District of Louisiana, by Malibu Boats
(2) Motion to dismiss for improper venue or in the alternative to transfer, by Marine Power
(3) Motion for temporary restraining order or preliminary injunction, by Malibu Boats
(4) Motion to amend complaint, by Malibu Boats (Filed 10/29/2014).

Marine Power filed the third lawsuit in this Court. This third case concerns a warranty on LS3 engines. Dealers of Malibu's boats contacted Marine Power about the failure of eight LS3 engines. Marine Power believes that the engines failed due to water intrusion because of a design defect in Malibu's boats. Malibu disagrees and claims that it has no responsibility for the failure of the LS3 engines. Marine Power invoiced Malibu for the costs of replacing the engines, and Malibu refuses to pay. Marine Power claims that this is contrary to the terms of Marine Power's warranty. Marine Power seeks a declaration from this Court that it has no obligation to repair or replace the failed engines per its warranty and that it is not responsible for the costs of manufacturing and installing corrective parts to prevent water from leaking into the LS3 engines. Marine Power also seeks damages for the engines it has already replaced and for the injury to its business reputation.

On October 29, Malibu moved to amend its complaint in the first lawsuit in Tennessee. In its proposed amended complaint, Malibu includes many assertions concerning the LS3 warranty at issue in the case pending here. Malibu seeks to add two new causes of action to the Tennessee ...


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