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Taylor v. Clarke Power Services

United States District Court, E.D. Louisiana

October 11, 2017

MARIANA ALVARADO TAYLOR
v.
CLARKE POWER SERVICES

         SECTION I

          ORDER & REASONS

          LANCETM. AFRICK, UNITED STATES DISTRICT JUDGE.

         Before the Court is a motion by defendants Clarke Power Services, Inc. d.b.a. VehiCare (“VehiCare”) and its insurer Continental Casualty Company (“CCC”) to dismiss the plaintiff's claims for punitive damages.[1] For the following reasons, the motion is granted.

         I.

         On July 22, 2015, Rahn Taylor was killed in a crash on Interstate 12 between Lacombe and Slidell, Louisiana. At the time of the accident, Taylor was driving a tractor-trailer owned by his employer, Crescent City Distributing (“CCD”), which had contracted with VehiCare for the inspection and maintenance of its tractor-trailer fleet. The crash allegedly resulted from a sudden tire failure on the right front steering axle.

         Taylor's wife brought the present lawsuit on behalf of herself and her minor children. As pertinent here, she claims that VehiCare was negligent in failing to properly inspect and maintain the tractor-trailer driven by her husband at the time of his death. She further asserts that VehiCare is liable for punitive damages. VehiCare now seeks to dismiss the latter claim.

         II.

         Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a district court may dismiss a complaint, or any part of it, when a plaintiff has not set forth well-pleaded factual allegations that would entitle him to relief. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); Cuvillier v. Taylor, 503 F.3d 397, 401 (5th Cir. 2007). A plaintiff's factual allegations must “raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. In other words, a complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570)).

         On a Rule 12(b)(6) motion to dismiss, a court limits its review “to the complaint, any documents attached to the complaint, and any documents attached to the motion to dismiss that are central to the claim and referenced by the complaint.” Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010); see also Spivey v. Robertson, 197 F.3d 772, 774 (5th Cir. 1999). In assessing the complaint, the Court must accept all well-pleaded factual allegations as true and liberally construe all such allegations in the light most favorable to the plaintiff. Spivey, 197 F.3d at 774; Lowrey v. Tex. A&M Univ. Sys., 117 F.3d 242, 247 (5th Cir. 1997). Where “the complaint ‘on its face show[s] a bar to relief, '” then dismissal is the appropriate course. Cutrer v. McMillan, 308 Fed. App'x. 819, 820 (5th Cir. 2009) (quoting Clark v. Amoco Prod. Co., 794 F.2d 967, 970 (5th Cir. 1986)).

         III.

         The complaint alleges that, under the terms of the inspection and maintenance contract between VehiCare and CCD, VehiCare was responsible for inputting maintenance schedules for CCD's vehicles.[2] This task was supposed to be performed at VehiCare's corporate offices in Ohio.[3] It was purportedly never performed.[4] Mrs. Taylor claims that this “failure to implement preventative maintenance schedules in Ohio demonstrates that VehiCare and/or VehiCare's agents or employees acted with conscious disregard for the rights and safety of other persons that had a great probability of causing substantial harm.”[5] This failure, she contends, entitles her to punitive damages under Ohio law.[6]

         This Court must apply Louisiana conflicts law to determine which state's substantive law governs the availability of punitive damages. See Erie R.R. v. Tompkins, 304 U.S. 64, 78-79 (1938); Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941). Article 3546 of the Louisiana Civil Code provides that punitive damages may not be awarded by a court in Louisiana unless authorized:

(1) By the law of the state where the injurious conduct occurred and by either the law of the state where the resulting injury occurred or the law of the place where the person whose conduct caused the injury was domiciled; or
(2) By the law of the state in which the injury occurred and by the law of the state where the person whose conduct caused the injury was domiciled.

         In general, then, punitive damages may be awarded when they are “authorized under the law of the state or states with two or more of the following contacts (a) place of the injurious conduct; (b) place of the resulting injury; and (c) place of the defendant's domicile.” Arabie v. Citgo Petroleum Corp., 89 So.3d 307, 327 (La. 2012) (Knoll, J.concurring in part and dissenting in part). In other words, “[a]n award of punitive damages is authorized when such damages are imposed by the laws of all three or any two of the states referenced in [Article 3546].” In re Train Derailment Near Amite, LA., on October 12, 2002, No. 03-cv-1531, 2004 WL 169805, at *2 (E.D. La. Jan 26, 2004) (Zainey, J.); La. Civ. Code. art 3546 cmt. (b).

         A.

         It is undisputed that the relevant injury in this case-Mr. Taylor's fatal crash-occurred in Louisiana. “Under Louisiana law, punitive or other ‘penalty' damages are not allowable unless expressly authorized by statute.” International Harvester Credit Corp. v. Seale, 518 So.2d 1039, 1041 (La. 1988). There is no Louisiana statute authorizing the recovery of punitive damages with respect to the claims asserted in this case. Hence, punitive damages are not authorized by the law of the state in which the injury occurred. Accordingly, to satisfy Article 3546, Mrs. Taylor must assert facts sufficient to show that punitive damages are authorized both by the law of the state where the injurious conduct occurred and by the law of the place where VehiCare was domiciled. The Court considers each of these requirements in turn.

         B.

         To be entitled to punitive damages in this case, Mrs. Taylor must establish that such damages are allowed by the law of the state where the injurious conduct occurred. As punitive damages are generally not allowed under Louisiana law, this requires her to show that the injurious conduct in this case occurred in Ohio.

         The complaint asserts that VehiCare had a duty, under its contract with CCD, to input maintenance schedules for CCD's vehicles.[7] This task was supposed to be performed at VehiCare's corporate offices in Ohio, but it was allegedly never completed.[8] This failure to implement maintenance schedules, Mrs. Taylor claims, constitutes injurious conduct occurring in Ohio that entitles her to punitive damages under Ohio law.

         In Arabie, the Louisiana Supreme Court held that “[i]n light of the State's general policy against punitive damages . . . in determining the location where injurious conduct occurred, management or corporate level decisions must outweigh tortious activity which occurs locally in order for the location of the corporate or management decision to be considered the locale of the injurious conduct.” 89 So.3d at 317. Reading the complaint as a whole and construing all factual assertions in a light most favorable to Mrs. Taylor, the Court concludes that Mrs. Taylor has not sufficiently alleged that corporate-level decisions occurring in Ohio outweigh the allegedly tortious activity that occurred in Louisiana.

         The complaint makes numerous allegations of conduct that occurred, or failed to occur, in Louisiana. For example, among other things, the complaint asserts that upon conducting an initial fleet inspection of Mr. Taylor's tractor on April 14, 2015 in Louisiana, VehiCare: (1) found a shallow tread on the right front steering tire and neither changed the tire nor scheduled the tire to be changed; (2) found mismatched tires having significantly different tread depths on the front steering tires and neither changed the tires nor scheduled the tires to be changed; (3) failed to discover or note visible and significant uneven wear on the right front steering tire; (4) found conditions of the right front steering tires that would probably deleteriously affect the handling of the vehicle and neither changed the tires nor scheduled the tires to be changed; and (5) failed to measure and note tread depth of the right front steering tire in multiple places.[9] It further alleges that VehiCare conducted its initial fleet inspection of Mr. Taylor's tractor in a Louisiana parking lot, at night, without access to a shop, and in conjunction with the inspection of numerous other vehicles.[10] It alleges that VehiCare failed to check the front steering tire alignment at the time of the initial fleet inspection; that it failed to convey to the New Orleans VehiCare facility certain deficiencies found in the initial fleet inspection; that it failed to conduct preventive maintenance on Mr. Taylor's tractor-trailer between the initial fleet inspection and his accident; that it failed to correct issues related to the tires on Mr. Taylor's tractor-trailer after a tire failure occurred prior to his accident; and that it failed to timely rotate Mr. Taylor's tires.[11]

         The complaint proceeds to allege that VehiCare failed to implement certain preventive maintenance standards and other policies at its New Orleans facilities.[12]It also alleges that VehiCare negligently forwarded out-of-service reports to CCD; that it failed to reasonably and reliably inform CCD of all fleet vehicles that were out of service for repairs at the end of the business day; that it failed to clearly designate the out-of-service parking area in which vehicles were pending repair; that it failed to have a procedure for removing keys from vehicles that were parked awaiting repair; that it failed to have a procedure in place to put placards on vehicles that were out of service; and that it failed to attempt to contact Mr. Taylor or his supervisor after learning that Mr. Taylor's tractor-trailer had been put back into service without being repaired.[13] Additionally, it alleges VehiCare failed to have proper processes in place for responding to drivers' complaints about vehicle conditions and that it failed to properly train and supervise its employees.[14]

         All of this allegedly negligent conduct, which Mrs. Taylor contends contributed to Mr. Taylor's crash and resulting death, took place in Louisiana. Furthermore, the alleged failure to take preventive care measures-the seemingly logical result of VehiCare's failure to input preventive maintenance schedules in Ohio-occurred in Louisiana. Accordingly, the Court finds that the injurious conduct in this case took place in Louisiana, not Ohio. Punitive damages are generally not allowed in Louisiana. Thus, Mrs. Taylor has not shown that punitive ...


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