Free Brief in Opposition to Motion - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No.

01-cv-2056-JLK

UNITED STATES AVIATION UNDERWRITERS, INC., a New York corporation; PAUL LEADABRAND, an Idaho resident; and JEFLYN AVIATION, INC. dba ACCESS AIR, an Idaho corporation, Plaintiffs, vs. PILATUS BUSINESS AIRCRAFT, LTD., a Colorado corporation; PILATUS FLUGZEUGWERKE AKTIENGESELLSCHAFT, a Swiss corporation; PILATUS AIRCRAFT, LTD., a Swiss corporation; PRATT & WHITNEY CANADA, INC., a Canadian corporation; and DOES 1 through 500, Inclusive, Defendants.

PLAINTIFFS' OPPOSITION TO "MOTION IN LIMINE BY PILATUS DEFENDANTS RE COMPLIANCE WITH FARS" (Doc. 110)

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TABLE OF CONTENTS

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INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . THE ISSUANCE OF A TYPE CERTIFICATE BY THE FAA DOES NOT PREVENT THE JURY FROM DECIDING THAT THE AIRPLANE AND ITS FLIGHT MANUAL DID NOT COMPLY WITH APPLICABLE FEDERAL AVIATION REGULATIONS . . . . . . . . . . . . . . . . . . . 3.1 The Jury May Conclude That The Products Were Defective, Even Though The FAA Issued A Type Certificate . . . . . . . . . . . . . . . . . . . . . . . . . .

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THE DEFENDANTS' ARGUMENTS HAVE ALREADY BEEN PROPERLY CONSIDERED AND REJECTED BY THIS COURT . . . . . . . . . . . . . . . . . . . . . . IF GIVEN BY THE COURT, THE INSTRUCTION REQUESTED BY THE DEFENDANTS WOULD CONSTITUTE REVERSIBLE ERROR UNDER COLORADO LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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TABLE OF AUTHORITIES

Cases Bruce v. Martin-Marietta Corp., 544 F.2d 442 (10th Cir. (W.D.Okla. 1976) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cleveland v. Piper Aircraft Corp., 985 F.2d 1438 (10th Cir. (D.N.M.) 1993) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Elsworth v. Beech Aircraft Corp., 37 Cal.3d 540 [691 P.2d 630] (Cal. 1984) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . In re Air Crash Disaster at Stapleton Intern. Airport, 721 F.Supp. 1185 (D.Colo. 1988) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mile Hi Concrete v. Matz, 842 P.2d 198 (Colo. 1992) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sunbird Air Services, Inc. v. Beech Aircraft Corp., 789 F.Supp. 360 (D.Kan. 1992) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . U.S. Aviation Underwriters, Inc. v. Pilatus Business Aircraft, Ltd., 358 F.Supp.2d 1021 (D.Colo. 2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . U.S. Aviation Underwriters, Inc. v. Pilatus Business Aircraft, Ltd., ­­ F.Supp.2d ­­, 2006 WL 2844173 (D.Colo. 2006) . . . . . . . . . . . . . . . . . . . Wagner v. Case Corp., 33 F.3d 1253 (10th Cir. (D.Colo.) 1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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TABLE OF AUTHORITIES Statutes and Rules 49 U.S.C. § 44701 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 U.S.C. § 40120(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . COLO.REV.ST.ANN. § 13-21-403(1)(a) . . . . . . . . . . . . . . . . . . . . . . . . . COLO.REV.ST.ANN. § 13-21-403(1)(b) . . . . . . . . . . . . . . . . . . . . . . . . . COLO.REV.ST.ANN. § 13--21-403(2) . . . . . . . . . . . . . . . . . . . . . . . . . . COLO.REV.ST.ANN. § 13-21-403(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . FED.R.CIV.P. 56 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 4 9 2-3, 8 9 8 2

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INTRODUCTION. Although styled as a "motion in limine," the defendants' motion (Doc. 110) does

not seek to exclude any particular evidence.

Instead, the defendants' motion seeks

dispositive relief in the form of an order instructing the jury that the airplane and its flight manual did comply with applicable Federal Aviation Regulations (FARs). The

defendants demand such an instruction in support of their defense that the products are rebuttably presumed to be non-defective under Colorado law. (COLO.REV.ST.ANN. § 1321-403(1)(b).) For several reasons, the defendants' motion (Doc. 110) must be denied.

1.

First, the time for filing dispositive motions (like this one) expired a long time ago. The defendants' motion does not even suggest that it complies with the requirements of FED.R.CIV.P. 56 (it does not), and the parties vigorously dispute the issue of whether the products did (or did not) comply with applicable FARs. (Pretrial Order, Doc. 98, pp. 12-14.) Outside of Rule 56, there is no authority for the Court to summarily adjudicate this disputed factual issue.

2.

Second, the same arguments that are now being made by the defendants in support of this motion (Doc. 110) have already been rejected by this Court as "facile." (Order, Doc. 88, pp. 14-15.) The defendants' arguments had no merit when they were made the first time, and they have no merit today.

3.

Third, as a matter of well-established law, the fact that the FAA issued a Type Certificate for the airplane does not mean that the jury is barred from finding that the products were defective and did not comply with applicable FARs.

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4.

Fourth, it would be reversible error to give the instruction requested by the defendants. The rebuttable presumption found in C.R.S. § 13-21-403(1)(b) is a meaningless legal nullity. Regardless of whether the products did (or did not) comply with applicable FAR's, the products are still deemed to be non-defective until such time as the plaintiffs meet their burden of proving otherwise.

Based on the foregoing, the plaintiffs respectfully submit that the defendants' motion in limine (Doc. 110) should be denied. 2.0 BACKGROUND. An almost brand-new airplane was ditched in the ocean after the pilot reported unusual noises and sounds coming from the airplane's only engine. The plaintiffs in this lawsuit seek to recover $3.1 million in stipulated damages for the loss of the airplane, which has never been recovered. (See, Pretrial Order [Doc. 98, ¶ III(A)(2)(b), pp. 5-6].) Additional facts are set forth in the Pretrial Order, and in this Court's previous orders. (U.S. Aviation Underwriters, Inc. v. Pilatus Business Aircraft, Ltd., 358 F.Supp.2d 1021 (D.Colo. 2005), and U.S. Aviation Underwriters, Inc. v. Pilatus Business Aircraft, Ltd., ­ ­ F.Supp.2d ­­, 2006 WL 2844173 (D.Colo. 2006).) 3.0 THE ISSUANCE OF A TYPE CERTIFICATE BY THE FAA DOES NOT PREVENT THE JURY FROM DECIDING THAT THE AIRPLANE AND ITS FLIGHT MANUAL DID NOT COMPLY WITH APPLICABLE FEDERAL AVIATION REGULATIONS. The defendants' motion in limine says: "Since this court must give deference to the FAA's findings of fact, it must also conclude as a matter of law that the PC-12 was in compliance with the applicable FARs." (Def. Mtn., pp. 2 and 7.) But there are no -3Access Air 0NR/PO/WO Lg24186/20070104

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"findings of fact." There is only a Type Certificate Data Sheet (TCDS) (Def. Exh. "B") which shows that the FAA accepted the Swiss government's representation that the airplane and its flight manual satisfied the minimum requirements of applicable Federal Aviation Regulations (FARs). As a matter of well-established law, the fact that the FAA issued a TCDS for the PC-12 airplane does not mean that the jury is precluded from determining that the airplane or its flight manual did not comply with applicable FARs. "Compliance with governmental air-safety regulations is admissible, but not conclusive, evidence in a suit arising out of an airplane crash." (Bruce v. Martin-Marietta Corp., 544 F.2d 442, 446 (10th Cir. (W.D.Okla. 1976).)

3.1

The Jury May Conclude That The Products Were Defective, Even Though The FAA Issued A Type Certificate. The same legislation that authorizes the Administrator of the FAA to promulgate

FARs (49 U.S.C. § 44701) includes a savings clause. (49 U.S.C. § 40120(c) ["A remedy under this part is in addition to any other remedies provided by law."]) This savings clause "recognizes that the statutory scheme established by the Federal Aviation Act

is designed merely to complement existing statutory and common law remedies, not supplant them." (Sunbird Air Services, Inc. v. Beech Aircraft Corp., 789 F.Supp. 360, 362 (D.Kan. 1992).) Therefore, as a matter of law, compliance with FARs "does
not preempt traditional tort remedies which have the effect of regulating that same conduct." (In re Air Crash Disaster at Stapleton Intern. Airport, Denver, Colo., on Nov. 15, 1987, 721 F.Supp. 1185, 1187 (D.Colo. 1988).)

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Moreover, the allowance of state law remedies does not create an irreconcilable conflict between federal and state regulations. [Plaintiff] does not challenge the power of the FAA to adopt safety regulations or to certify aircraft as complying with those regulations. Nor does it seek to revoke the certification of the [subject] aircraft. The regulations promulgated by the FAA are merely minimum safety standards and do not preclude a finding of negligence where a reasonable person would take additional precautions. [Citations omitted.] Thus, even if the trier of fact should find that the fuel control unit was defective, this would have no effect on the FAA's power to certify aircraft, or on the validity of its certification decision. [Citation omitted.] For this reason, the court also concludes that plaintiff's claims are not an impermissible collateral attack on the FAA's decision to certify the aircraft. (Sunbird Air Services v. Beech Aircraft Corp., supra, 789 F.Supp. at p. 362.)

The defendants argue that the jury cannot conclude that the airplane and its flight manual do not comply with the FARs, because the FAA has already decided that the airplane and its flight manual do comply with the FARs. (Def. Mtn., pp. 2 and 7.) A substantially similar argument was made by the defendant airplane manufacturer in Elsworth v. Beech Aircraft Corp., 37 Cal.3d 540 [691 P.2d 630] (Cal. 1984), where "[t]he FAA had certified the design of the [airplane] as complying with all applicable safety regulations." (Id. at p. 546 [691 P.2d at p. 633].) The trial court "read to the jury five FAA safety regulations that plaintiffs alleged [the airplane] failed to meet," and "the jury returned a general verdict against" the manufacturer. (Id. at p. 547 [691 P.2d at p. 633].) On appeal, the manufacturer (like the defendants here) argued "that the jury should have been compelled to give determinative effect to the FAA decision that the [airplane] complied with all applicable safety regulations," and the jury should not have been allowed "to second-guess the FAA decision that the [airplane] -5Access Air 0NR/PO/WO Lg24186/20070104

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complied with the regulations." (Ibid.) This argument was squarely rejected by the Supreme Court of California: "Plaintiffs do not challenge the power of the FAA to adopt safety regulations or to certify aircraft as complying with those regulations. Nor do they seek to revoke the certification of the Travel Air." (Id. at pp. 549-550 [691 P.2d at p. 635].) Elsworth was cited with approval by the Tenth Circuit in Cleveland v. Piper Aircraft Corp., 985 F.2d 1438 (10th Cir. (D.N.M.) 1993). In Cleveland, the airplane manufacturer (like the defendants here) argued that it could not be held liable because the FAA had already approved the design of the airplane. (Id. at p. 1445.) The Tenth Circuit rejected this argument:

FAA approval is not intended to be the last word on safety. ... [¶] 'The FAA certification process is founded upon a relatively simple notion: the duty to ensure that an aircraft conforms to FAA safety regulations lies with the manufacturer and operator, while the FAA retains the responsibility for policing compliance. Thus, the manufacturer is required to develop the plans and specifications and perform the inspections and tests necessary to establish that an aircraft design comports with the applicable regulations; the FAA then reviews the data for conformity purposes by conducting a "spot check" of the manufacturer's work.' [Citation omitted.] Thus, FAA certification is, by its very nature, a minimum check on safety. (Cleveland v. Piper Aircraft Corp., supra, 985 F.2d at pp. 1445-1446.)

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THE DEFENDANTS' ARGUMENTS HAVE ALREADY BEEN PROPERLY CONSIDERED AND REJECTED BY THIS COURT. In its order denying the defendants' motions for summary judgment and partial

summary judgment (Doc. 88), this Court ruled:

Defendants' suggestion that FAA certification affords all aircraft and aircraft component part manufacturers a presumption of nonliability for defects that may only later manifest themselves is facile. There is no suggestion the FAA certification process entails actual testing of all aircraft and aircraft components it covers and no suggestion the FAA shut down and restarted the Pratt & Whitney engine 'certified' in this case during flight. Defects such as the PT blade weakness/friability alleged here may be latent and reveal themselves only over a period of time or through usage clearly foreseeable by the manufacturer. Any statutory presumption that would operate to shift the risk of loss from such defects away from manufacturers and toward consumers (or the FAA) as Defendants suggest runs directly contrary to § 402A and the public policy choices it embodies. (Doc. 88, pp. 14-15)

The arguments now being made by the defendants in this motion in limine are substantially similar (if not identical) to the arguments that have already been rejected by this Court. The defendants have offered no new facts or authorities to suggest that this Court's analysis was wrong, and therefore, the Court should summarily deny this motion in limine as repetitive and frivolous.

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IF GIVEN BY THE COURT, THE INSTRUCTION REQUESTED BY THE DEFENDANTS WOULD CONSTITUTE REVERSIBLE ERROR UNDER COLORADO LAW. Section 13-21-403(1)(b) of the Colorado Product Liability Act creates a

rebuttable presumption that a product is not defective if the product "[c]omplied with, at the time of sale by the manufacturer, any applicable code, standard, or regulation adopted or promulgated by the United States or by this state, or by any agency of the United States or of this state." (COLO.REV.ST.ANN. § 13-21-403(1)(b).) This statutorily created rebuttable presumption has no real legal effect, since (of course) the product is already rebuttably presumed to be not defective until the plaintiffs meet their burden of proving otherwise. An identical rebuttable presumption found in COLO.REV.ST.ANN. § 13-21-403(3) was addressed by the Supreme Court of Colorado in Mile Hi Concrete v. Matz, 842 P.2d 198 (Colo. 1992).) In Mile Hi Concrete, jury returned a verdict in favor of the

defendants. On appeal, the plaintiff "asserted that the district court erred in instructing the jury that [the defendant] was entitled to a presumption of non-defectiveness" under C.R.S. § 13-21-403(3). (Id. at pp. 201-202.) The Court of Appeals agreed with plaintiff, and reversed the judgment. (Ibid.) The Supreme Court of Colorado concurred, holding that "[t]he district court committed reversible error in giving an improper instruction on the statutory presumption contained in section 13-21-403(3)." (Id. at p. 2-6.) The Supreme Court of Colorado noted that "[i]t is precisely because the plaintiff (the party against whom the presumption is directed) already has the burden of going forward with evidence in this case that an instruction based on the statutory presumption of section 1321-403(3) is meaningless." (Id. at p. 205.)

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If a plaintiff fails to present sufficient evidence that a product is defective, he cannot satisfy the burden of persuasion or establish a prima facie case and a court will direct a verdict for the defendant. On the other hand, a plaintiff who has presented sufficient evidence to defeat a motion for a directed verdict has necessarily rebutted the presumption of section 13-21403(3). Therefore, no reason exists for a trial judge to instruct a jury on the statutory presumption of section 13-21-403(3). (Mile Hi Concrete v. Matz, supra, 842 P.2d at pp. 205-206.)

The same can be said about the statutory presumption favored by the defendants in this case. That rebuttable presumption is "meaningless," and the instruction sought by the defendants (if given) would constitute reversible error. (Wagner v. Case Corp., 33 F.3d 1253, 1257 (10th Cir. (D.Colo.) 1994) [reversible error to instruct jury on rebuttable presumption created by COLO.REV.ST.ANN. § 13-21-403(1)(a)].)1

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The plaintiffs have asked the Court to instruct the jury on the rebuttable presumption

found in COLO.REV .ST.ANN . § 13-21-403(2) ["In like manner, noncompliance with a government code, standard, or regulation existing and in effect at the time of sale of the product by the manufacturer which contributed to the claim or injury shall create a rebuttable presumption that the product was defective or negligently manufactured."]) (See Amend. Jury Instr., Doc.95, p. 78.) But the rebuttable presumption sought by plaintiffs does not stand on the same shaky legal footing as the presumption sought by defendants, because the plaintiffs' presumption is consistent with the plaintiffs' burden of proof.

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CONCLUSION. Based on the foregoing, the plaintiffs respectfully request that the defendants'

motion in limine (Doc. 110) be denied.

Respectfully Submitted, Dated: January 25 , 2007 s/ Jeffrey J. Williams Jon A. Kodani, Esq. Jeffrey J. Williams, Esq. LAW OFFICES OF JON A. KODANI Attorneys for Plaintiffs United States Aviation Underwriters, Inc. et al. 2200 Michigan Avenue Santa Monica, CA 90404-3906 Tel: (310) 453-6762 Fax: (310) 829-3340 Email: [email protected]

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CERTIFICATE OF SERVICE U.S. Aviation Underwriters et al. v. Pilatus Business Aircraft etc. et al. D.Colorado Case No. 01-K-2056 [XXXXX] I hereby certify that on January 25, 2007 , I electronically filed the foregoing with the Clerk of Court using the CM/ECF system which will send notification of such filing to the following e-mail addresses: For Defendant Pratt & Whitney Thomas J. Byrne, Esq. Byrne, Kiely & White 1120 Lincoln Street, Suite 1300 Denver, CO 80203 Tel. (303) 861-5511 Fax (303) 861-0304 Email: [email protected] [email protected]

For Pilatus Defendants Robert B. Schultz, Esq. Law Offices of Robert B. Schultz 9710 W. 82nd Avenue Arvada, CO 80005 Tel. (303)456-5565 Fax (303)456-5575 Email: [email protected]

[

]

I hereby certify that on , I have mailed or served the document or paper to the following non CM/ECF participants in the manner (mail, hand delivery, etc.) indicated by the non-participant's name: s/ Jeffrey J. Williams Jeffrey J. Williams, Esq. LAW OFFICES OF JON A. KODANI Attorneys for Plaintiffs United States Aviation Underwriters, Inc. et al. 2200 Michigan Avenue Santa Monica, CA 90404-3906 Tel: (310) 453-6762 Fax: (310) 829-3340 Email: [email protected]

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