United States District Court, E.D. Kentucky, Central Division, Lexington
MITSUI SUMITOMO INSURANCE USA, INC. as subrogee of ASAHI BLUEGRASS FORGE CORPORATION, Plaintiff,
DENHAM-BLYTHE COMPANY, INC., et al., Defendants.
AMENDED MEMORANDUM OPINION AND ORDER
M. Hood Senior U.S. District Judge.
matter comes before the Court on Defendant Denham-Blythe
Company, Inc's (“Denham-Blythe”) Motion to
Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6)
[DE 20] and Defendant BlueScope Buildings North America,
Inc.'s (“BlueScope”) Motion for Judgment on
the Pleadings [DE 28]. Having considered the matter fully,
and being otherwise sufficiently advised, the undersigned
will grant Defendant Denham-Blythe's Motion to Dismiss
Pursuant to Federal Rule of Civil Procedure 12(b)(6) [DE 20]
and deny Defendant BlueScope's Motion for Judgment on the
Pleadings [DE 28].
AND PROCEDURAL BACKGROUND
case arises from a January 31, 2011 design-build contract
(“the Contract”) between Asahi Bluegrass Forge
Corporation (“Asahi”) and Denham-Blythe for the
construction of a 68, 000 square foot manufacturing facility
(“the Building”). [DE 20-1, at 2]. “As part
of its obligations as general contractor, Denham-Blythe
contracted with several Contractors to complete the design
and construction process[, ]” including BlueScope,
Varco Pruden Buildings (“Varco”) (a division of
BlueScope), and Arrow Metals and Coatings, Inc.
(“Arrow”). [DE 29, at 2].
and Asahi utilized AIA Document A141 - 2004 Standard Form of
Agreement Between Owner and Design-Builder, with
modifications specific to this job, for the Contract.”
[DE 20-1, at 2 (citing [DE 20-2])]. The Contract defines a
“Contractor” as follows:
§ A.1.1.4 CONTRACTOR A Contractor is a person or entity,
other than the Architect, that has a direct contract with the
Design-Builder to perform all or a portion of the
construction required in connection with the Work. The term
"Contractor" is referred to throughout the
Design-Build Documents as if singular in number and means a
Contractor or an authorized representative of the Contractor
. . . .
[DE 29, at 2-3 (citing [DE 23-1, at 14])]. On March 2, 2012,
the roof of the Building was damaged by severe winds and was
subsequently repaired by Denham-Blythe. [DE 20-1, at 2].
Again, on March 1, 2017, the roof of the Building sustained
damage from severe winds, and Denham-Blythe completed both
the temporary repair work and permanent repair work.
the roof was damaged on March 1, 2017, Asahi submitted
property damages claims to its insurer, Plaintiff Mitsui
Sumitomo Insurance USA, Inc. (“Mitsui”).
Id. “According to the Complaint, Mitsui
Sumitomo made payments to Asahi in response to the claims in
the amount of $1, 315, 092.00 under policy PKG3126694
(hereinafter referred to as ‘the Policy') with
effective dates of October 1, 2016 through October 1,
2017.” Id. (citing [DE 20-3]). On February 22,
2018, Mitsui, as subrogee of Asahi, filed its Complaint [DE
1] against Denham-Blythe, BlueScope, Varco, and Arrow
asserting subrogation rights against Defendants for the
amounts paid to repair the property damage caused by the 2017
severe winds. [DE 1]. Mitsui's claims against
Denham-Blythe include negligence, breach of contract, breach
of warranty of workmanlike services, and negligent
misrepresentation. Id. Mitsui's allegations
against BlueScope and Varco include negligence, negligent
misrepresentation, breach of warranty of workmanlike service,
and breach of contract and third-party beneficiary.
Id. On April 13, 2018, Denham-Blythe filed the
present Motion to Dismiss [DE 20], and on February 15, 2019,
BlueScope filed the present Motion for Judgment on the
Pleadings [DE 28] requesting Mitsui's claims against
BlueScope and Varco be dismissed. BlueScope's Motion for
Judgement on the Pleadings [DE 28] is nearly identical to
Denham-Blythe's Motion to Dismiss [DE 20]. The only
substantial difference between the two Motions [DE 20; DE 28]
is that BlueScope's Motion [DE 28] omitted
Denham-Blythe's argument that the claim is barred by the
dispute resolution clauses in the contract.
Rule of Civil Procedure 12(b)(6) provides that a complaint
may be attacked for failure “to state a claim upon
which relief can be granted.” To survive a Rule
12(b)(6) motion to dismiss, a complaint must “contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). “A motion to dismiss is properly granted if it
is beyond doubt that no set of facts would entitle the
petitioner to relief on his claims.” Computer
Leasco, Inc. v. NTP, Inc., 194 Fed.Appx. 328, 333 (6th
Cir. 2006). When considering a Rule 12(b)(6) motion to
dismiss, the court will presume that all the factual
allegations in the complaint are true and draw all reasonable
inferences in favor of the nonmoving party. Total
Benefits Planning Agency v. Anthem Blue Cross & Blue
Shield, 552 F.3d 430, 434 (6th Cir. 2008) (citing
Great Lakes Steel v. Deggendorf, 716 F.2d 1101, 1105
(6th Cir. 1983)). “The court need not, however, accept
unwarranted factual inferences.” Total Benefits
Planning Agency, 552 F.3d at 434 (citing Morgan v.
Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir.
standard of review for a judgment on the pleadings [pursuant
to Federal Rule of Civil Procedure 12(c)] is the same as that
for a motion to dismiss under Federal Rule of Civil Procedure
12(b)(6).” Roger Miller Music, Inc. v. Sony/ATV
Publishing, LLC, 477 F.3d 383, 389 (6th Cir. 2007).
DEFENDANT DENHAM-BLYTHE'S MOTION TO DISMISS PURSUANT TO
support of dismissal, Defendant Denham-Blythe argues the
following: (1) “Kentucky law recognizes the sacred
right to contract;” (2) “[t]he claim is barred by
the waiver of subrogation clause contained in the design
build contract between Denham-Blythe and Asahi Bluegrass
Forge Corporation;” (3) “[t]he insurance policy
issued by Plaintiff to Asahi Bluegrass Forge Corporation
granted Asahi the right to waive subrogation;” and (4)
“[t]he claim is barred by the dispute resolution
clauses in the contract.” [DE 20-1, at 1].
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