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Petroleum Helicopters, Inc. v. Rolls Royce Corp

United States District Court, S.D. Indiana, Indianapolis Division

January 17, 2017

PETROLEUM HELICOPTERS, INC., Plaintiff,
v.
ROLLS ROYCE CORP., Defendant.

          ORDER ON MOTION FOR RECONSIDERATION

          TANYA WALTON PRATT, JUDGE

         Before the Court is Defendant Rolls Royce Corp.'s (“Rolls Royce”) Motion for Reconsideration filed pursuant to Federal Rule of Civil Procedure 59(e). On January 30, 2013, Plaintiff Petroleum Helicopters, Inc. (“PHI”) filed an Amended Complaint in the Western District of Louisiana against several parties to recover damages for the loss of a helicopter which was forced to make an emergency landing onto the Gulf of Mexico after an engine, manufactured by Rolls-Royce, malfunctioned. (Filing No. 15.) PHI asserts that redhibitory defects[1] in Rolls Royce's engine caused its helicopter to malfunction, resulting in the destruction of the helicopter. On May 29, 2015, PHI's claims against Rolls Royce were severed and transferred to this Court. (Filing No. 160.)

         On July 18, 2016, Rolls Royce moved for summary judgment, asserting that PHI is bound by a Limited Warranty, PHI's claims are barred by the “economic loss” doctrine, and a superseding cause caused the destruction of PHI's helicopter. (Filing No. 192.) In response, PHI argued a design defect in the engine was not subject to the Limited Warranty and the economic loss and superseding cause doctrines were inapplicable. (Filing No. 197.) In reply, Rolls Royce asserted, among other things, a statute of limitations defense regarding PHI's engine defect claim under Indiana law. (Filing No. 199.) Thereafter, on December 9, 2016, the Court concluded that Rolls Royce waived its statute of limitations defense because it filed an answer to PHI's Amended Complaint, but failed to argue that PHI's engine defect claim was time barred. The Court also found that Rolls Royce raising the defense in a Reply Brief amounted to a surprise and undue prejudice to PHI, as it failed to afford PHI prior notice or the opportunity to respond to the defense. (Filing No. 204.) Rolls Royce now requests reconsideration, asserting that the Court's Order denying Rolls Royce's Motion for Summary Judgment regarding the statute of limitations defense runs contrary to the Federal Rule of Civil Procedure 11. (Filing No. 206.) For the following reasons, Roll Royce's Motion for Reconsideration is denied.

         I. BACKGROUND

         A. Undisputed Facts

         Rolls Royce manufactures turbine aircraft engines and parts used in helicopters. (Filing No. 193 at 1.) PHI, one of Rolls Royce's long standing customers, operates one of the largest fleet of rotary aircraft in the world, and also offers helicopter transport services. Id. In 1999, Rolls-Royce designed, manufactured, and sold an engine to Bell Helicopter Canada. (Filing No. 15 at 3; Filing No. 193 at 2.) In 2009, Bell Helicopter Canada installed Rolls Royce's engine into the helicopter at issue. (Filing No. 193 at 2.) Thereafter, in 2011, PHI purchased a replacement engine component known as a No. 2 bearing from Rolls Royce and independently installed it into the helicopter's engine. Id. at 3. The replacement No. 2 bearing included a Limited Warranty for spare modules and parts. Id. at 7.

         On December 1, 2011, the No. 2 bearing failed, causing the entire engine to lose power. (Filing No. 197 at 3.) This malfunction forced the pilot to perform an emergency landing onto the Gulf of Mexico. (Filing No. 15 at 3.) During the emergency landing, the pilot inflated skid mounted floats which were designed to keep the helicopter from sinking. Id. The pilot and his passenger then entered inflated life rafts and were rescued within ten minutes. (Filing No. 193 at 2.) The rescuers returned to the floating helicopter and attempted to tow the helicopter to a platform for recovery. Id. at 8. After towing the helicopter for approximately an hour, the float deflated. Id. The helicopter inverted into the salt water, resulting in the helicopter's destruction. Id. at 2.

         B. The Louisiana Litigation

         In December 2012, PHI filed a Complaint in the Western District of Louisiana. On January 30, 2013, PHI amended its Complaint against Rolls Royce, APICAL Industries, Inc. (“APICAL”), and Offshore Helicopter Support Services, Inc., (“OHS”), requesting compensatory damages and attorney's fees. (Filing No. 15.) PHI asserted redhibition claims against Rolls Royce, and APICAL, as well as a strict products liability claim against APICAL, and a breach of contract claim against OHS. Id. PHI specifically contends that Rolls Royce is liable because the “engine contained defects in its manufacture or design that rendered it useless, or its use so inconvenient that it must be presumed that PHI would not have bought the Engine had it known of the defects.” Id. at 4. On July 22, 2013, Rolls Royce moved the United States District Court for the Western District of Louisiana to dismiss or transfer PHI's claims against it to the Southern District of Indiana, pursuant to a forum selection clause contained in the Limited Warranty. (Filing No. 62.) Rolls Royce renewed that Motion on December 16, 2013. (Filing No. 106.) On May 29, 2015, PHI's redhibition claims against Rolls Royce was severed and transferred to this Court. (Filing No. 160.)

         Thereafter, on July 18, 2016, Rolls Royce moved for summary judgment under Indiana law, asserting PHI is bound by the Limited Warranty, PHI's claims are barred by the “economic loss” doctrine, and a superseding cause caused the destruction of PHI's helicopter. (Filing No. 192.) In response, PHI argued a material issue of fact remains because a design defect in the engine was not subject to the Limited Warranty and the economic loss and superseding cause doctrines were inapplicable. (Filing No. 197.) In reply, Rolls Royce asserted, among other things, that PHI's engine defect claim was time-barred pursuant to Ind. Code Ann. § 26-1-2-725. (Filing No. 199.) Thereafter, the Court granted in part and denied in part Rolls Royce's Motion for Summary Judgement, specifically concluding that Rolls Royce waived its statute of limitations defense because it filed an answer to PHI's Amended Complaint, but failed to argue that PHI's design defect claim was time barred. The Court also found that Rolls Royce's act of raising the defense in a Reply Brief amounted to a surprise and undue prejudice to PHI, as it failed to afford PHI prior notice or the opportunity to respond to the defense. (Filing No. 204.)

         Rolls Royce now requests the Court to reconsider its Order asserting, among other things, that the Court's ruling conflicts with Federal Rule of Civil Procedure 11. (Filing No. 206.)

         II. LEGAL STANDARD

         The purpose of a motion to alter or amend judgment under Rule 59(e) is to ask the court to reconsider matters properly encompassed in a decision on the merits. Osterneck v. Ernst & Whinney, 489 U.S. 169, 174 (1989). A Rule 59(e) motion will be successful only where the movant clearly establishes: (1) that the court committed a manifest error of law or fact, or (2) that newly discovered evidence precluded entry of judgment. Cincinnati Life Ins. Co. v. Beyrer, 722 F.3d 939, 954 (7th Cir. 2013); United States v. Resnick, 594 F.3d 562, 568 (7th Cir. 2010). Relief pursuant to a Rule 59(e) motion to alter or amend is an “extraordinary remed[y] reserved for the exceptional case.” Foster v. DeLuca, 545 F.3d 582, 584 (7th Cir. 2008). In this regard, a manifest error is not demonstrated by merely presenting “the disappointment of the losing party.” Oto v. Metro. Life Ins. Co., 224 F.3d 601, 606 (7th Cir. 2000) (a manifest error is “the wholesale disregard, misapplication, or failure to recognize controlling precedent.”). Further, a motion to alter or amend a judgment is not an opportunity to “relitigate motions or present arguments, issues, or facts that could and should have been presented earlier.” Brownstone Publ'g, LLC v. AT&T, Inc., No. 1:07-CV-1630-SEB, 2009 WL 799546, at *3 (S.D. Ind. Mar. 24, 2009). See also Sigsworth v. City of Aurora, Ill., 487 F.3d 506, 512 (7th Cir. 2007).

         III. ...


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