Opinion
NO: 3:18CV166-M-P
2021-03-11
STATE FARM FIRE AND CASUALTY CO., as subrogee of Taylor Boone and Laurel Boone, Plaintiff v. AMAZON.COM, INC., Samsung SDI Co., John and Jane Does 1-10, and ABC Corporations 1-10, Defendants
David Lee Gladden, Jr., Bridget K. Harris, Gladden & Ingram, PLLC, Madison, MS, for Plaintiff. Franklin P. Brannen, Jr., King & Spalding, Atlanta, GA, for Defendants.
David Lee Gladden, Jr., Bridget K. Harris, Gladden & Ingram, PLLC, Madison, MS, for Plaintiff.
Franklin P. Brannen, Jr., King & Spalding, Atlanta, GA, for Defendants.
ORDER
Michael P. Mills, UNITED STATES DISTRICT JUDGE
This cause comes before the Court on the defendant Samsung SDI Co., Ltd.'s ("Samsung") motion for summary judgment [106]. The Court, having considered the memoranda and submissions of both parties, along with relevant case law and evidence, is now prepared to rule.
I. Factual Background
This is a products liability subrogation case arising from a March 16, 2016 house fire. Taylor Boone, Laurel Boone and their two children lived in a home in Oxford, Mississippi. The Boones gave their children two self-balancing smart scooters, or "hoverboards," for Christmas in 2015.
Both hoverboards were purchased through Amazon.com. One hoverboard was ordered by Laurel Boone herself on October 31, 2015, and the other was purchased by the Boones through an elementary school fundraiser/raffle on November 10, 2015. The school fundraiser hoverboard was also shown to have been purchased through Amazon.com.
Ms. Boone did not know the actual model name, manufacturer or seller of the hoverboard she herself purchased via Amazon. The email receipt indicates the item was listed on Amazon as "Smart Scooter Two Wheels Self Balance Electronic w/ Samsung Battery Red" and the seller was "Sanway." It is important to note that any person or entity can list items for sale on Amazon and title their listing however they so choose.
The product purchased from the school fundraiser was sold by a seller called "DISCOUNTST" and there is no assertion that the information provided on the Amazon listing indicated that Samsung batteries were included.
A fire erupted just before noon on March 16, 2016, and completely destroyed the Boone's home and most of their personal belongings. Ultimately State Farm indemnified the Boones for over $600,000.00 in losses related to the fire.
The plaintiff alleges the fire resulted from the malfunction of one or both of the hoverboards or the hoverboards' batteries. However, no definitive cause of fire can be determined. Additionally, both sides' experts agree that none of the eight batteries from the hoverboards which were actually recovered after the fire are Samsung batteries.
When the plaintiff attempted to send a notice of the subrogation claim and inspection to Sanway, the seller of the hoverboard, the delivery driver notified the plaintiff that the address provided was an empty field in China.
At the end of the day, the issues before us boil down to: (1) Plaintiff's only actual evidence that Samsung manufactured the batteries in either hoverboard is an email receipt from an Amazon listing, and (2) The parties' experts agree that none of the batteries recovered from the fire were Samsung batteries, but neither parties' expert can conclusively say that any of the 32 batteries which could not be recovered after the fire were or were not a Samsung battery.
II. Analysis
Federal Rule of Civil Procedure 56 provides that summary judgment is appropriate when evidence indicates that there is no genuine issue as to any material fact, only at that point is a movant entitled to judgment as a matter of law. Celotex Corp. v. Catrett , 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).
The movant must support its assertion that a genuine issue of fact does not exist by (a) citing to the record; or (b) showing that the record does not establish the presence of a genuine dispute, or that the adverse party cannot produce admissible evidence to support the fact. United States ex rel. Jamison v. McKesson Corp. , 784 F. Supp. 2d 664 (N.D. Miss. 2011). In this vein of "required proof," "the hearsay rule applies with equal force in the context of a summary judgment." Warfield v. Byron , 436 F.3d 551, 559 (5th Cir. 2006). Thus, "summary judgment evidence cannot be based on hearsay." Fowler v. Smith , 68 F.3d 124, 125 (5th Cir. 1995).
A. Admissibility of Amazon Receipt
The Court must first examine the admissibility of the Amazon receipt. If the receipt is deemed to be hearsay, it will affect whether the Plaintiff has sufficient evidence to create a question of fact in regards to the presence of Samsung batteries.
"Hearsay is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted." Fed. R. Evid. 801(c). Unless covered within an exception, hearsay evidence is inadmissible. Fed. R. Evid. 802.
The Amazon receipt at issue here was submitted as Exhibit A to Plaintiff's Response to the Motion for Summary Judgment. [109] The exhibit depicts an email received by Taylor Boone at his Gmail address providing what appears to be a purchase receipt and shipment confirmation of a "Smart Scooter Two Wheels Self Balance Electronic w/ Samsung Battery Red " "Sold by: Sanway." [109 see Ex. A] To be clear, the receipt has been submitted into evidence by the plaintiff to prove that Samsung batteries were present in this particular hoverboard.
However, "[w]hen purchasing products on Amazon.com, customers must agree to Amazon's "Conditions of Use," which specify that both Amazon and third parties sell products on the website. The conditions [also] inform customers that Amazon isn't responsible for third-party product descriptions nor does Amazon provide any warranties for those products." McMillan v. Amazon.com, Incorporated , 983 F.3d 194, 197 (5th Cir. 2020).
In essence, the plaintiff has offered the email receipt into evidence in an effort to demonstrate that the content of the receipt is truthful and supports her allegations. This distinction of attempting to use the contents of the receipt to prove that Samsung batteries were present in at least one of the hoverboards requires the Court to examine if the receipt is admissible under any of the hearsay exceptions before it considers whether summary judgment is appropriate. See also U.S. v. Redd , 2009 WL 348831, at *13 (5th Cir. 2009).
To be sure, this analysis is a novel issue in evidence which is being pushed to its limits by the quickly and ever changing nature of the internet and the rise of online marketplaces.
1. Business Record Hearsay Exception
Rule 803(6) of the Federal Rules of Evidence provides that a business record, such as a receipt may be admissible if:
(A) the record was made at or near the time by – or from information transmitted by – someone with knowledge;
(B) the record was kept in the course of a regularly conducted activity of a business, organization, occupation, or calling, whether or not for profit;
(C) making the record was a regular practice of that activity;
(D) all of these conditions are shown by the testimony of the custodian or another qualified witness, or by a certification that complies with Rule 902(11) or (12) or with a statute permitting certification; and
(E) the opponent does not show that the source of information or the method or circumstances of preparation indicate a lack of trustworthiness.
Here, the computer-generated purchase order from Amazon.com meets many of the requirements enumerated under Rule 803(6) to show that a purchase was made through Amazon.com in that it is made at or near the time of the transaction, is kept in the course of a regularly conducted activity of business, and that making the record was a regular practice of that activity. Where the plaintiff runs into problems though, is that the attempt to use the contents of the record to prove that a component was present in the item, the plaintiff has not stated that it has a custodian, other qualified witness, or other certification method to verify the record in compliance with Rule 803(6)(D), and more importantly the plaintiff's inability to locate the seller, Sanway, necessarily means that the considerations listed under Rule 803(6)(E) such as the source of information for the listing, and therefore the trustworthiness cannot be meaningfully examined.
Indeed, the absent seller is the missing link in this case. But nonetheless, because the plaintiff can offer no witness, custodian or otherwise, to indicate trustworthiness of the contents of the receipt, Rule 803(6), the business record exception to hearsay, does not apply here.
2. Residual Exception to Hearsay
Finding no other potential hearsay exception to admit the receipt, the Court must turn to Rule 807, the residual exception to hearsay. Rule 807, known as the residual exception to hearsay, states that:
(a) In General. Under the following conditions, a hearsay statement is not excluded by the rule against hearsay even if the statement is not admissible under a hearsay exception in Rule 803 or 804 :
(1) the statement is supported by sufficient guarantees of trustworthiness – after considering the totality of the circumstances under which it was made and evidence, if any, corroborating the statement; and
(2) it is more probative on the point for which it is offered than any other evidence that the proponent can obtain through reasonable efforts.
(b) Notice. The statement is admissible only if the proponent gives and adverse party reasonable notice of the intent to offer the statement – including its substance and the declarant's name – so that the party has a fair opportunity to meet it. The notice must be provided in writing before the trial or hearing–or in any form during the trial or hearing if the court, for good cause, excuses a lack of earlier notice.
District Courts have a considerable amount of discretion in applying the residual exception to the hearsay rule. A court of appeals will not disturb the district court's ruling "absent a definite and firm conviction that the court made a clear error of judgment in the conclusion that it reached based upon the weighing of the relevant factors." Page v. Barko Hydraulics , 673 F.2d 134, 140 (5th Cir. 1982).
The defendant asserts that the email receipt is inadmissible because the listing entity identified only as Sanway on the receipt has not been identified, which essentially makes the contents of the receipt a statement of an "anonymous declarant," meaning there is no way to verify the veracity or accuracy of the statement. Since the declarant cannot be identified and the receipt does not fall under any of the other hearsay exceptions, the receipt must be inadmissible as to any assertion of proof that a Samsung battery was in Sanway's hoverboard.
The plaintiff argues that the receipt should be admissible as an exception to hearsay under Fed. R. Evid. 807 because they were unable to locate the actual manufacturer or seller of the hoverboard, thus making the receipt their "best evidence" that Samsung manufactured batteries contained in the hoverboard.
The plaintiff has several hurdles which it cannot overcome to admit the receipt under Rule 807. The first being under 807(a)(1) requiring sufficient guarantees of trustworthiness. As previously stated, the seller of the item on the receipt has not been located. No party can guarantee the trustworthiness of an unidentified declarant. This inability to gauge trustworthiness outweighs the fact that the receipt is "more probative on the point for which it is offered than any other evidence that the proponent can obtain through reasonable efforts." Secondly, under 807(b) the plaintiff must provide certain information about the statement to allow the defendant a chance to "meet it." Here, the plaintiff is unable to provide notice of the declarant's name – meaning the defendant has no fair opportunity to depose them, conduct discovery, or in any meaningful way combat the statement.
As such, when neither prong of Fed. R. Evid. 807 can be met, the proposed hearsay must be excluded.
B. Claims against Samsung
The Plaintiff seeks to impose liability upon Samsung as the alleged designer and manufacturer of 18650 lithium-ion battery cells, which it asserts were present in at least one of the hoverboards. Indeed, the very baseline inquiry of whether or not the plaintiff can show that the defendant actually manufactured any batteries in either of the hoverboards seems necessary before analyzing liability under the Mississippi Products Liability Act or any other theory of negligence.
"Where the opposing party bears the burden of proof at trial, the moving party need not submit evidentiary documents to properly support its motion, but need only point out the absence of evidence supporting the essential elements of the opposing party's case." Ledet v. Fleetwood Enterprises, Inc. , 245 F.3d 791, at *2 (5th Cir. 2000). And "[o]nce a properly supported motion for summary judgment is presented, the burden shifts to the non-moving party who bears the burden of proof at trial to show with ‘significant probative’ evidence that there exists a triable issue of fact." Conkling v. Turner , 18 F.3d 1285, 1295 (5th Cir. 1994) ; citing In re Municipal Bond Reporting Antitrust Litig. , 672 F.2d 436, 440 (5th Cir. 1982). Specifically, after the motion was filed alleging that the plaintiff lacked the evidence to prove the essential elements of its case, it must "do more than simply rely on the pleadings or merely rest ‘upon conclusory allegations, improbable inferences, and unsupported speculation." Clinton v. Johnson , 2014 WL 4851086, at *3 (S.D. Miss 2014).
As such, we must begin with an accounting of the evidence before us. First, we have the Amazon.com purchase receipt. The Court has discussed this document at length above and has determined it is inadmissible hearsay, the contents of which cannot be used in the summary judgment inquiry before the Court. This leaves expert witness testimony as the only other evidence to examine.
Here, both parties agree that only 8 of 40 battery cells (20 battery cells per hoverboard) were recovered after the fire. The parties also agree that 0 of the 8 batteries recovered were Samsung batteries. Therefore, the resulting implication is that there is no physical evidence which can be presented to show that Samsung batteries were present in either of the hoverboards. In its response, the plaintiff asserts that "the fact remains that there are thirty-two unidentifiable batteries that were component parts of the two hoverboards in question that no one can state with absolute certainty belonged to Samsung or some other manufacturer." [110 at p. 4]. Curiously, the plaintiff has made no effort to join any other lithium-ion battery makers in this suit, yet their expert would not be able to rule out those manufacturers either. In sum, the statement by the plaintiff and its experts amounts to no more than unsupported speculation, which Clinton v. Johnson advised is insufficient to overcome summary judgment.
Upon the motion of Samsung, the burden shifted to State Farm. State Farm's inability to provide significant probative evidence to indicate the presence of any battery manufactured by Samsung SDI, Co. means that there is no genuine issue of fact to put before a jury and that dismissal is necessary.
IT IS HEREBY ORDERED that defendant Samsung SDI Co., Ltd.'s motion for summary judgment [106] is GRANTED and judgment will be entered in favor of the defendants and seeing no other claims or defendants remaining, the case shall be DISMISSED WITH PREJUDICE.