United Statesa Cas. Ins. Co. v. Metro. Edison Co.

USAA CASUALTY INSURANCE

COMPANY, a/s/o JOAN SONNEN, Plaintiff, v. METROPOLITAN EDISON COMPANY,Defendant/Third Party Plaintiff, v. SCHNEIDER ELECTRIC USA, INC.f/k/a SQUARE D COMPANY, Third Party Defendant.

CIVIL ACTION NO. 1:12-CV-1178

UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

Dated: July 16, 2014

(Chief Judge Conner)

MEMORANDUM

Plaintiff USAA Casualty Insurance Company ("USAA"), as subrogee of Joan Sonnen, filed the above-captioned action against defendant Metropolitan Edison Company ("Met-Ed"), alleging negligence and willful and/or wanton misconduct arising from an electrical fire in Ms. Sonnen's home. (Doc. 1). Met-Ed subsequently impleaded Schneider Electric USA, Inc. ("Schneider"), formerly known as Square D Company, as a third-party defendant pursuant to Federal Rule of Civil Procedure 14. (Doc. 48). Presently before the court is Met-Ed's motion for summary judgment (Doc. 58) against USAA, relying on a motion in limine to exclude the testimony of USAA's expert witness, Ronald J. Panunto, P.E., C.F.E.I.,C.F.C. (Doc. 56). For the reasons that follow, the court will deny Met-Ed's motion in limine as well as the motion for summary judgment.

I. Factual Background & Procedural History

A. Factual Background

On November 17, 2010, a fire occurred at the home of Joan Sonnen in Manchester, Pennsylvania as a result of an electrical malfunction. (Doc. 59 ¶ 5; Doc. 71 ¶ 5). Ms. Sonnen has a property insurance policy with plaintiff USAA, a Texas corporation licensed to do business in Pennsylvania. (Doc. 10 ¶¶ 1, 6).

Defendant Met-Ed is a Pennsylvania corporation that provides electricity to Ms. Sonnen's home via its 720 distribution line. (Id. ¶ 2; Doc. 59 ¶ 7; Doc. 71 ¶ 7). On November 17, 2010, the breaker at the Zionsview substation for the 720 distribution line opened at 12:57 p.m. and reclosed seven seconds later. (Doc. 59 ¶ 8; Doc. 71 ¶ 8). Thereafter, an electrical fire ignited at the main circuit breaker in the electrical panel in Ms. Sonnen's basement. (Doc. 59 ¶ 9; Doc. 71 ¶ 9). This fire was initially reported to the Union Fire Department at approximately 5:40 p.m. (Doc. 59 ¶ 6; Doc. 71 ¶ 6).

B. Procedural History

On June 20, 2012, USAA, as subrogee of Joan Sonnen, filed a complaint (Doc. 1) against Met-Ed and thereafter filed an amended complaint (Doc. 10) on August 1, 2012, alleging claims for negligence and willful and/or wanton misconduct related to the electrical fire. (Doc. 59 ¶¶ 1-2; Doc. 71 ¶¶ 1-2). Met-Ed filed a motion to dismiss (Doc. 14) pursuant to Federal Rule of Civil Procedure 12(b)(1) and 12(b)(6). (Doc. 59¶ 3; Doc. 71 ¶ 3). On January 10, 2013, the court adopted the Report and Recommendation of Magistrate Judge Methvin (Doc. 23) and denied the motion to dismiss. (Doc. 30; Doc. 59 ¶ 4; Doc. 71 ¶ 4).

On May 5, 2013, Met-Ed filed a third-party complaint against Schneider, alleging strict liability for a defective main circuit breaker and contribution or indemnification for negligence. (Doc. 48). Schneider filed an answer on June 11, 2013 and included a cross-claim against Met-Ed for contribution or indemnification. (Doc. 51).

C. Expert Testimony

USAA proffers the expert report and testimony of Ronald J. Panunto, P.E., C.F.E.I., C.F.C. in support of its claims. (See Doc. 59-1, Ex. 1; Doc. 71-1, Ex. 1). Mr. Panunto earned a Bachelor of Science degree in electrical engineering from Drexel University and is a registered professional engineer in Pennsylvania, New York, New Jersey, North Carolina, Delaware, and Connecticut. (See Doc. 71-4, Ex. 4). He is a senior member of the Institute of Electrical and Electronic Engineers and a Certified Fire and Explosion Investigator with the National Association of Fire Investigators. (Id.) Mr. Panunto has previously held positions as a Field Engineering and Substation Design Branch Manager at PECO Energy and as a Project Manager at Gannett Fleming, Inc. (Id.) Currently, Mr. Panunto is the President of Dawson Engineering, an electrical design and forensic engineering company. (Id.; Doc. 59-2, Ex. 2, Panunto Dep. 5:22-7:6, Dec. 19, 2013; Doc. 71-3, Ex. 3, Panunto Dep. 5:22-7:6, Dec. 19, 2013). As a forensic engineer, Mr. Panunto hasinvestigated or provided testimony in approximately 226 cases during the past five years. (Panunto Dep. 12:2-14:2). Significantly, Mr. Panunto has over 40 years of experience in the field of electrical utility and power system engineering. (See Doc. 71-4, Ex. 4).

In his expert report, Mr. Panunto opines that Met-Ed did not adequately maintain trees and tree branches along the 720 distribution line as required by Rule 218 of the National Electric Safety Code ("NESC") and the Pennsylvania Public Utility Commission ("PPUC"). (Doc. 59 ¶ 11; Doc. 71 ¶ 11; see also Doc. 59-1, Ex. 1 at 4; Doc. 71-1, Ex. 1 at 4). As a result of inadequate vegetation management, Met-Ed's customers, including Ms. Sonnen, suffered many power outages prior to the electrical fire at issue. (Doc. 59 ¶ 11; Doc. 71 ¶ 11; see also Doc. 59-1, Ex. 1 at 4; Doc. 71-1, Ex. 1 at 4). These repeated power outages caused repeated high-voltage transients, which in turn caused accelerated wear and eventual failure of the main circuit breaker in Ms. Sonnen's electrical panel. (Doc. 59 ¶ 11; Doc. 71 ¶ 11; see also Doc. 59-1, Ex. 1 at 5; Doc. 71-1, Ex. 1 at 5). Despite Met-Ed's awareness of customer complaints and repeated power outages on the 720 distribution line, Met-Ed did not perform necessary vegetation management to troubleshoot the problem. (Doc. 59 ¶ 11; Doc. 71 ¶ 11; see also Doc. 59-1, Ex. 1 at 5; Doc. 71-1, Ex. 1 at 5).

Mr. Panunto concludes that, on November 17, 2010, a power outage and resultant high-voltage transients (due to vegetation contact) caused the electrical failure at the main circuit breaker in Ms. Sonnen's electrical panel. (Doc. 59 ¶ 11; Doc. 71 ¶ 11; see also Doc. 59-1, Ex. 1 at 5; Doc. 71-1, Ex. 1 at 5). Specifically, thehigh-voltage transients caused the main circuit breaker to flash over and electric arcing ignited the insulation on the electrical panel's wiring. (Doc. 59 ¶ 11; Doc. 71 ¶ 11; see also Doc. 59-1, Ex. 1 at 5; Doc. 71-1, Ex. 1 at 5).

Met-Ed and Schneider filed motions for summary judgment on January 13, 2014. (Docs. 58, 61). As part and parcel of its motion for summary judgment, Met-Ed moves in limine to exclude the expert testimony of Mr. Panunto.¹ (Doc. 56). Met-Ed argues that USAA cannot meet its burden of proof as to the negligence claim because Mr. Panunto's expert opinions are not sufficiently reliable under Federal Rule of Evidence 702 to constitute admissible evidence. (Doc. 60 at 4-9). Thus, as a threshold issue, the court must determine whether Mr. Panunto's testimony and report are admissible. Thereafter, the court will address Met-Ed's motion for summary judgment.

II. Legal Standard

Under Federal Rule of Civil Procedure 56, summary judgment is appropriate only when "there is no genuine dispute as to any material fact," and the moving party is entitled to judgment as a matter of law. FED. R. CIV. P. 56(a). A factual dispute is material if it might affect the outcome of the action under applicable law, and it is genuine only if there is a sufficient evidentiary basis that would allow areasonable factfinder to return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986).

The burden of proof is upon the non-moving party to come forth with "affirmative evidence, beyond the allegations of the pleadings," in support of its right to relief. Pappas v. City of Lebanon, 331 F. Supp. 2d 311, 315 (M.D. Pa. 2004); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). "Such affirmative evidence—regardless of whether it is direct or circumstantial—must amount to more than a scintilla, but may amount to less (in the evaluation of the court) than a preponderance." Saldana v. Kmart Corp., 260 F.3d 228, 231-32 (3d Cir. 2001) (quoting Williams v. Borough of West Chester, 891 F.2d 458, 460-61 (3d Cir. 1989)). This evidence must be adequate, as a matter of law, to sustain a judgment in favor of the non-moving party on the claims. See Anderson, 477 U.S. at 250-57; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-89 (1986); see also FED. R. CIV. P. 56(c), (e). Only if this threshold is met may the cause of action proceed. Pappas, 331 F. Supp. 2d at 315.

"A party may object that the material cited to support or dispute a fact cannot be presented in a form that would be admissible in evidence." FED. R. CIV. P. 56(c)(2). When there is a proper challenge to the admissibility of evidence, such as a motion in limine to exclude expert testimony, the party offering the expert bears the burden of establishing the admissibility of such expert's testimony and report by a preponderance of the evidence. See Burke v. TransAm Trucking, Inc., 617 F. Supp. 2d 327, 331 (M.D. Pa. 2009); see also In re Paoli R.R. Yard PCB Litig.("Paoli II"), 35 F.3d 717, 744-46 (3d Cir. 1994).

Admissibility of expert testimony is a question of law governed by Federal Rule of Evidence 702. See Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 58889 (1993). Trial courts must act as gatekeepers to "ensure that any and all scientific testimony or evidence admitted is . . . reliable." Id. at 589. Rule 702 provides that:

A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if: (a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue; (b) the testimony is based on sufficient facts or data; © the testimony is the product of reliable principles and methods; and (d) the expert has reliably applied the principles and methods to the facts of the case.

FED. R. EVID. 702. The Third Circuit has explained that Rule 702 sets forth three separate restrictions on the admission of expert testimony: qualification,...