E-Alert Case Updates

Counter-Claim For Indemnification And Contribution Denied For Being Conclusory

Arguetta v. McGill Airflow, LLC
Civ. No. JKB-11-1102 (D.Md.) (Jan. 4, 2012)
by Kevin M. Cox, Associate
Semmes, Bowen & Semmes (www.semmes.com)

Plaintiff, Gillermo Arguetta, filed suit against Defendants, McGill Airflow, LLC, McGill Airsilence, LLC and United McGill Corporation (hereinafter, collectively, the “McGill Defendants”), and Cincinnati Fan Co., (“CFC”), alleging negligence, products liability, and breach of warranty, and seeking compensatory and punitive damages. The McGill Defendants sought leave to file a Cross-Claim against CFC for indemnification and contribution. The McGill Defendants’ Motion for Joinder and for Leave to File Cross-Claim was denied for the reasons below.

The case arose from Plaintiff’s injuries while using a tool called a Leak Detective Testing Kit, allegedly designed and manufactured by Defendants. While Plaintiff was using the Leak Detective to locate and seal leaks at a bio-medical facility his hand was sucked through the machine’s air inlet and into its unguarded fan housing. The blade of the fan allegedly struck Plaintiff’s hand and crushed the bones in three (3 of his fingers, leading to his fingers being amputated.

Plaintiff filed suit in the Circuit Court for Frederick County against only the McGill Defendants, whom he alleged designed, manufactured, and distributed the Leak Detective. The McGill Defendants removed this case to Federal court on April 27, 2011. During discovery, however, the parties discovered labels under the machine’s fan indicating that the fan was manufactured by CFC. Plaintiff then filed an Amended Complaint, adding CFC as a Defendant. The McGill Defendants then moved for leave to file a Cross-Claim against CFC for indemnification and contribution.

Pursuant to FED. R. CIV. PROC. 15(a)(2), leave to file an amended or supplemental pleading should be “freely give[n] where justice so requires.” A district court may deny leave, however, if the new pleading would prejudice the opposing party, if the moving party has acted in bad faith, or if the pleading would be futile.

CFC attacked the McGill Defendants’ motion on three (3) grounds: (1) that the motion was untimely; (2) that the Cross-Claim would be more appropriately adjudicated in State court; and (3) that the Cross-Claim failed to allege sufficient facts to state claims for indemnification or contribution. The Court held that the first of these two (2) arguments was plainly without merit, citing to Charles Allan Wright, et al., FED. PRAC. & PROC. CIV. § 1431 (3d ed.). The Court agreed with CFC, however, that the McGill Defendants’ proposed Cross-Claim was factually deficient.

According to the Court, the Cross-Claim did not allege any facts supporting an inference that the McGill Defendants were entitled to the relief they sought; indeed, it did little more than describe the parties and subject matter of the underlying action, and make conclusory declarations that it was entitled to indemnification and contribution from CFC if the McGill Defendants were found liable to Plaintiff. Courts, including the United States District Court for the District of Maryland, have repeatedly held such statements to be insufficient to support Cross-Claims for these remedies.

Therefore, because the McGill Defendants’ proposed Cross-Claim failed to meet the general pleading standards of FED. R. CIV. P. 8(C), the cross-claim could not survive a Motion to Dismiss under FED. R. CIV. P 12(b)(6). The McGill Defendants’ Motion for Leave to File the Cross-Claim was therefore denied without prejudice. The Court stated that the McGill Defendants were free to renew their motion if and when they had drafted a Cross-Claim that set out a plausible legal theory, with adequate factual support, under which CFC would be liable to them for indemnity and contribution.