HARRY D. LEINENWEBER, District Judge.
Before the Court is Defendant Office Depot, Inc.'s motion to dismiss. For the reasons that follow, the Court grants the motion.
This case involves a subrogation action which arises from a fire in the 25-story Bank of America, N.A. ("BOA") banking center located at 33 North Dearborn, in Chicago, Illinois. On March 6, 2011, an electrical counterfeit currency bill detector started a fire at BOA. The fire spread and caused significant damage to BOA and adjacent properties in the building. Plaintiffs Lexington Insurance Company, Arch Specialty Insurance, Hanover Insurance Company, Cincinnati Insurance Company, State Farm Fire & Casualty Company, Certain Underwriters at Lloyds of London and Certain London Market Insures, and American Family Insurance Group (collectively, "Plaintiffs") insured the building and various tenants against the loss at the time of the fire. Plaintiffs have reimbursed each of their insureds for their losses and now seek to recover amounts they paid their insureds in connection with the fire. They seek to be reimbursed from Defendants Hilton Trading Corporation d/b/a Accubanker USA, ("Accubanker"), Office Depot, Inc. ("Office Depot") and Bank of America, N.A. (collectively, "Defendants").
On December 14, 2012, Defendant Office Depot removed this case to Federal Court. Shortly after removing the case, it filed the instant motion, seeking to dismiss Plaintiffs' negligence (Count III) and strict liability (Count IV) claims.
"A motion under Rule 12(b)(6) challenges the sufficiency of the complaint to state claim upon which relief may be
Plaintiffs assert a negligence claim against Defendant Office Deport for its part in selling the defective electrical counterfeit currency bill detector. Office Depot contends Plaintiffs' negligence claim should be dismissed because Plaintiffs fail to allege Office Depot owed and breached a legal duty to Plaintiffs. Plaintiffs argue their complaint alleges Office Depot owed a duty to Plaintiffs because of its involvement in the design, manufacture, testing and inspecting of the electrical counterfeit currency bill detector.
"[I]n any negligence action, a plaintiff must establish the existence of a duty, a breach of that duty, an injury that was proximately caused by that breach, and damages." Jablonski v. Ford Motor Co., 353 Ill.Dec. 327, 955 N.E.2d 1138, 1153-54 (2011). "The touchstone of this [C]ourt's duty analysis is to ask whether a plaintiff and a defendant stood in such a relationship to one another that the law imposed upon the defendant an obligation of reasonable conduct for the benefit of the plaintiff." Marshall v. Burger King, 222 Ill.2d 422, 305 Ill.Dec. 897, 856 N.E.2d 1048, 1057 (2006). In determining whether a defendant owed a duty, the Court considers (1) likelihood of injury; (2) reasonable foreseeability of such injury; (3) the magnitude of the burden of guarding against the injury; and (4) consequences of placing that burden on defendant. Brewster v. Rush-Presbyterian-St. Luke's Med. Center, 361 Ill.App.3d 32, 296 Ill.Dec. 884, 836 N.E.2d 635, 637 (2005).
In relevant part, Plaintiffs' complaint states, "Office Depot owed a duty to Plaintiffs to exercise reasonable skill and care in designing, constructing, manufacturing, testing, inspecting and selling the subject Accubanker D62 [the electrical counterfeit currency bill detector]." ECF No. 1-1 at ¶ 70. Plaintiffs allege Office Deport breached this duty by, "[f]ailing to properly construct the subject Accubanker D62... failing to properly design the subject Accubanker D62, failing to properly warn of the dangerous condition that existed ... failing to correct and/or remedy the unreasonable defects ... failing to maintain proper process and quality control over the manufacture, assembly of completeness..." Id. at ¶ 71.
Office Depot argues these allegations are insufficient because 1) it did not design or manufacture the electrical counterfeit currency bill detector; and because 2) the complaint fails to allege the electrical counterfeit bill detector was in a dangerous condition when it arrived at BOA or that Office Depot had knowledge of the said defects. The Court agrees.
The electrical counterfeit currency bill detector in this case is not analogous to a smoke detector. As a seller of this product, the Court does not find it was reasonable for Office Depot to foresee that the sale of the said product would result in fire to multiple property owners.
As further support for dismissal, Office Depot references Judge St. Eve's recent opinion in the related case, Brenner, Ford & Monroe et. al. v. Bank of America and Office Depot, Inc. See No. 12-C-6400, ECF No. 33. In that subrogation case, the insurance companies representing the adjacent tenants have sued BOA and Office Depot to recover amounts they paid to the insureds in connection with the same fire. The court there granted Office Depot's motion to dismiss plaintiffs' negligence claims, finding plaintiffs failed to allege Office Depot owed plaintiffs a legal duty. Id.
Office Depot argues that because Plaintiffs' complaint in this case has nearly identical allegations as the one in Brenner, Ford & Monroe, this Court should follow suit. In response, Plaintiffs make no attempt to distinguish the instant complaint from the one in Brenner, Ford & Monroe. Instead, they suggest Judge St. Eve erred because she focused "simply on the allegation of warning, not the inspection, testing, design and manufacture allegations." Pls.' Resp. to Def. Office Depot's Mot. to Dismiss Pls.' Comp. at 6.
This Court disagrees with Plaintiffs' characterization. In her ruling, Judge St. Eve noted that the dismissal of the negligence claim against Office Depot was appropriate because plaintiffs failed to "establish that Office Depot could foresee the injuries sustained by Plaintiffs who were not purchasers, users, or foreseeable users of the product." Brenner, Ford & Monroe et al. v. Bank of America and Office Depot, Inc., No. 12-C-6400, (Dec. 7, 2012), ECF No. 33. The same is true here. Plaintiffs are not purchasers or foreseeable users of the electrical counterfeit currency bill detector. Thus, the Court fails to see how the claim here warrants different treatment.
Furthermore, Plaintiffs fail to allege that Office Depot knew or should have known that the electrical counterfeit currency bill detector was in a defective condition at the time it was sold to BOA. See Jablonski, 353 Ill.Dec. 327, 955 N.E.2d at 1159 ("[W]hen a design defect is present at the time of sale, the manufacture has a duty to take reasonable steps to warn at
Accordingly, the Court finds Plaintiffs have not pled that Office Depot owed Plaintiffs a duty. As such, their negligence claim against Office Depot must be dismissed.
Plaintiffs also allege a strict liability tort claim based on products liability. They claim Office Depot is liable under this theory because it distributed the defective electrical counterfeit currency bill detector and failed to "properly design, manufacture, test, inspect and sell" the product. Pls.' Comp. at 16. Office Depot argues that this claim should be dismissed pursuant to Illinois' "seller's exception." 735 Ill. Comp. Stat. 5/2-621 (West 2010).
To establish a strict liability claim in Illinois, a plaintiff must plead that 1) an injury resulted from a condition in a product; 2) the condition of the product was unreasonably dangerous; and 3) the condition existed at the time the product left the manufacturer's control. Saieva v. Budget Rent-A-Car of Rockford, 227 Ill.App.3d 519, 169 Ill.Dec. 334, 591 N.E.2d 507, 515 (1992). "At common law, all entities in the distributive chain of an allegedly defective product, including manufacturers, sellers, wholesalers, distributors, and lessors of the product, are strictly liable in the products liability actions for injuries resulting from that product." Brobbey v. Enter. Leasing Co., 404 Ill.App.3d 420, 343 Ill.Dec. 856, 935 N.E.2d 1084, 1091 (2010). In 1979, Illinois enacted the "seller's exception." See 735 Ill. Comp. Stat. 5/2-621. This exception allows the Court to dismiss a nonmanufacturer defendant from a strict liability product claim, if the defendant certifies the correct identity of the manufacturer of the defective product. Id.
Attached with Office Depot's motion is an affidavit from its National Account Manager. See Tierney v. Vahle, 304 F.3d 734, 738-39 (7th Cir.2002) (explaining that while courts are typically confined to the pleadings on 12(b)(6) motion to dismiss, the court can consider documents that are central to the plaintiff's claim). This affidavit certifies that "[t]he only counterfeit bill detector Office Depot ever sold was product number 937747, [the electrical counterfeit currency bill detector at issue] which was manufactured by and purchased from Hilton Trading Corp. d/b/a Accubanker USA." See ECF No. 7-4 at ¶ 11.
Despite this certification, Plaintiffs contend dismissal is not appropriate because Office Depot's affidavit "fails to certify the correct identity of the manufacturer of the defective product ..." Pls.' Resp. to Def. Office Depot's Mot. to Dismiss Pls.' Comp. at 10. In light of the language quoted above, the Court finds this assertion baffling. It is undeniable that the affidavit states that the electrical counterfeit bill detector "was manufactured by and purchased from Hilton Trading Corp. d/b/a Accubanker USA." See ECF No. 7-4 at ¶ 11. Because of this, the Court finds Office Depot has satisfied the requirements for the seller's exception.
However, the Court's inquiry does not end here. There are certain exceptions
735 Ill. Comp. Stat. 5/2-621(c)(1)(3).
Plaintiffs argue that their complaint alleges that Office Depot exercised significant control over the design and manufacture of the product. They contend that Office Depot's affidavit fails to refute this allegation. The Court disagrees.
Paragraph 12 of the affidavit states that after Office Depot received the electrical counterfeit currency bill detectors it "never opened or otherwise altered the individual "D-62" counterfeit detection unit boxes [and] these boxes were shipped to Bank of America, N.A. per order specifications in their original unaltered unit boxes." ECF No. 7-4 at ¶ 12. The Court finds this statement sufficient to establish that Office Depot was not in significant control of the design or manufacturing of the product at issue. Therefore, the Court finds the exception to the seller's exception inapplicable.
As a final note, the Court points out that if Plaintiffs engage discovery and find that the information in Office Depot's affidavit is inaccurate, Plaintiffs are permitted to bring Office Depot back in this litigation. See 735 Ill. Comp. Stat. 5/2-621(b)(2); see also LaRoe v. Cassens & Sons, Inc., 472 F.Supp.2d 1041, 1053 (S.D.Ill.2006) (stating that non-manufacturing defendant dismissed from an action pursuant to the seller's exception to products liability claims "remains functionally a party, susceptible of reinstatement at any time before judgment"). At this juncture, however the Court finds dismissal appropriate.
For the foregoing reasons, the Court grants Defendant Office Depot's motion to dismiss.