Opinion
Civ. No. 21-638
2023-11-30
George M. Belfield, Southampton, PA, for Plaintiff. Charles W. Spitz, Joel H. Feigenbaum, Post & Schell, P.C., Philadlephia, PA, for Defendant.
George M. Belfield, Southampton, PA, for Plaintiff.
Charles W. Spitz, Joel H. Feigenbaum, Post & Schell, P.C., Philadlephia, PA, for Defendant.
ORDER
Paul S. Diamond, District Judge.
This suit arises from the loss of sixteen VHS tapes delivered to Defendant CVS Pharmacy for conversion to DVDs. Plaintiff Marie Lamb (who is represented by counsel) brings replevin and breach of contract claims against CVS and seeks punitive and compensatory damages, including damages for emotional distress. (Doc. No. 17.) CVS moves for summary judgment on the replevin claim and damages (Doc. No. 42), which I will grant.
I. LEGAL STANDARDS
Upon motion of any party, summary judgment is appropriate "if there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). I "must view the facts in the light most favorable to the non-moving party," and take every reasonable inference in that party's favor. Hugh v. Butler Cnty. Family YMCA, 418 F.3d 265, 267 (3d Cir. 2005).
The moving party must initially show the absence of any genuine issues of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). An issue is material only if it could affect the result of the suit under governing law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The opposing party must then support each essential element with concrete evidence in the record. See Celotex, 477 U.S. at 322-23, 106 S.Ct. 2548; Jones v. UPS, 214 F.3d 402, 407 (3d Cir. 2000) (requiring more than "unsupported allegations" to defeat summary judgment); Hugh, 418 F.3d at 267 ("[T]he non-moving party cannot solely rest upon her allegations.").
"[C]onclusory, self-serving affidavits are insufficient to withstand a motion for summary judgment." Paladino v. Newsome, 885 F.3d 203, 208 (3d Cir. 2018) (quoting Kirleis v. Dickie, McCamey & Chilcote, P.C., 560 F.3d 156, 161 (3d Cir. 2009)); see also Parker v. Sch. Dist. of Phila., 823 F. App'x 68, 72 (3d Cir. 2020) ("[A] litigant cannot rely on suspicions, simple assertions, or conclusory allegations. Nor can a summary judgment motion be defeated by speculation and conjecture, or conclusory, self-serving affidavits."); Gentles v. Portock, No. 19-cv-0581, 2022 WL 4586136, at *5 (E.D. Pa. Sept. 29, 2022) ("[T]his Court is not 'required to accept unsupported, self-serving testimony as evidence sufficient to create a jury question.'" (quoting Hammonds v. Collins, No. 12-cv-00236, 2016 WL 1621986, at *3, (M.D. Pa. April 20, 2016))).
Moreover, I may not consider settlement offers or settlement documents on the issue of liability or damages. Fed. R. Evid. 408; Liptok v. Bank of Am., No. 3:15-cv-156, 2016 WL 6818362, at *12 (M.D. Pa. Oct. 20, 2016), report and recommendation adopted, No. 3:15-cv-156, 2016 WL 6780757 (M.D. Pa. Nov. 16, 2016), aff'd, 773 F. App'x 97 (3d Cir. 2019) ("[A] settlement
offer is not tantamount to a confession, may not be admitted into evidence, and cannot defeat a motion for summary judgment, where only evidence which is admissible at trial may be considered in ruling on a motion for summary judgment.").
II. BACKGROUND
On December 3, 2019, Lamb's son, Thomas Austin, took sixteen VHS video tapes to the CVS Pharmacy at 259 Market Street in Philadelphia for conversion to DVDs. (Doc. No. 42 at 78; Doc. No. 43 at 22.) Austin had seen CVS's advertisements showing a three-week turnaround and hoped to have them done by Christmas. (Doc. No. 42 at 78; Doc. No. 43 at 22; see Doc. No. 43 at 34-35.) CVS Shift Manager Theresa Jones gave Austin sixteen separate envelopes and told him that the mailman would shortly pick up the tapes from CVS to be delivered to a processing lab. (Doc. No. 42 at 78-79; Doc. No. 43 at 22.) Austin wrote his name, phone number, and the date on the form on each of the sixteen envelopes, put the tapes in each separate envelope, and was given sixteen receipts corresponding with each tape. (Doc. No. 42. at 78; Doc. No. 43 at 22; see Doc. No. 42 at 52-53.)
Each receipt is labeled "CVS Pharmacy / Photo" and states in large letters: "Please Read Limit of Liability" and "READ THIS NOTICE":
the submission of film, prints, slides, negatives, videos, CD or any other media for processing, printing, or any other handling, constitutes an agreement by you that if such film, slides, negatives, videos, CD or any other media is damaged, lost or mishandled by FUJIFILM North America Corporation, its affiliates, retailers, agents or employees, even though due to the negligence or other fault of any of the foregoing, liability will be limited to replacement of an equivalent amount of unexposed film or media and processing. The forgoing will be your exclusive remedy for any such loss, damage or mishandling. Except for such replacement, the acceptance for processing, printing, or handling of any film, slides, negatives, videos, CD or any other media is without warranty whatsoever (whether expressed or implied) or other liability of any kind. Recovery for incidental, punitive, indirect or consequential damages is specifically waived and excluded. NOT RESPONSIBLE FOR PROPERTY LEFT OVER 30 DAYS.
(Doc. No. 42 at 99-114 (emphasis added).) Austin denies reading this or having any discussions regarding limitations of liability or damages. (Doc. No. 43 at 22.) The sixteen bags labeled "CVS Pharmacy / Photo" and printed with the order forms—which require signature—include similar clauses on the back, with one distinction: rather than read Fujifilm, they state "Our Company." (Doc. No. 42 at 52-53.)
CVS sent the VHS tapes from CVS's store to the third-party vendor, Fujifilm, for conversion. (Id. at 46.) The tapes never returned to CVS. (Id. at 47.) Austin checked with CVS several times and was told the DVDs had not arrived. (Id. at 79; Doc. No. 43 at 22.) CVS corresponded with Fujifilm and the U.S. Postal Service "but could not ascertain the whereabouts of the VHS tapes." (Doc. No. 42 at 79.) Accordingly, CVS could not recover the videos. (Id.; Doc. No. 43 at 32.) Lamb then wrote to CVS Chief Financial Officer Larry Menlo alleging a "run around" and requesting information, including the results of any related investigation. (Doc. No. 42 at 79; Doc. No. 43 at 26-28.)
On January 7, 2021, Lamb brought this action in the Philadelphia Common Pleas Court for alleging replevin, breach of contract, negligence, and intentional infliction of emotional distress. (Doc. No. 1.) CVS
removed to this Court. (Id.) June Judges (to whom this matter was assigned) granted CVS's Motion to Dismiss the negligence and IIED claims. (Doc. Nos. 4, 7, 8.) In her Amended Complaint, Lamb brought claims for replevin, breach of contract, negligent infliction of emotional distress, and fraud. (Doc. No. 9). CVS moved to dismiss the NIED and fraud claims, which Judge Jones granted. (Doc. Nos. 10, 15, 16.) Remarkably, Lamb filed a Second Amended Complaint bringing the same claims, and Judge Jones again granted CVS's motion to dismiss the NIED and fraud claims. (Doc. Nos. 17, 22, 23).
On November 3, 2022, this case was reassigned to me. (Doc. No. 36.) CVS now moves for partial summary judgment on the replevin claim, and to limit damages for breach of contract. (Doc. No. 42.) Lamb responded, attaching affidavits signed by her and her son, Thomas Austin. (Doc. No. 43.)
III. REPLEVIN
CVS argues that Lamb's replevin claim is moot because CVS does not possess the tapes. Lamb responds that even if the tapes are lost, the replevin claim is not moot because the tapes "were indisputably in CVS' actual or constructive possession" when they were lost. (Doc. No. 43 at 2.) I agree with CVS.
"Replevin is an action undertaken to regain possession of goods and chattels and to recover damages for their caption and detention, by the illegal act of the defendant." Int'l Elec. Co. v. N.S.T. Metal Prods. Co., 370 Pa. 213, 88 A.2d 40, 42 (1952). To make out a replevin claim, Lamb must prove that CVS is "in actual or constructive possession of the property which is the subject of the action." Langbord v. U.S. Dep't of the Treasury, 749 F. Supp. 2d 268, 274 (E.D. Pa. 2010), aff'd in part 832 F.3d 170 (3d Cir. 2016) (quoting Commonwealth v. Dean, 245 Pa.Super. 322, 369 A.2d 423, 425 (1976)). This has long been the law in Pennsylvania:
"An action of replevin cannot be maintained against one not in the actual or constructive possession of the property sought to be recovered, so that the defendant, if judgment be rendered against him, may make delivery thereof to the plaintiff. That proposition is so plain as to require little discussion."
Winner v. Messinger, 165 Pa.Super. 507, 69 A.3d 172, 174 (1949) (internal citations omitted); see also Herdic v. Young, 55 Pa. 176, 178 (1867) ("The primary purpose of replevin is to recover the property in specie; not its value.")
It is undisputed that CVS does not have the tapes, having mailed the tapes to Fujifilm for processing. (Doc. No. 42 at 46.) It is also undisputed that if the tapes (or DVDs) were sent back, they never reached CVS, which has not been able to locate them. (Id. at 47, 79.) In these circumstances, Lamb's replevin claim fails as a matter of law.
IV. DAMAGES
CVS does not dispute that it breached the bailment contract, but argues that damages are limited by the Receipt's Limit of Liability Clause. Lamb contends that the Clause is an unenforceable exculpatory clause. She is mistaken.
Because the Clause limits damages and does not bar any cause of action, it is a limitation of liability clause, not an exculpatory clause. See Valhal Corp. v. Sullivan Assocs., Inc., 44 F.3d 195, 202 (3d Cir. 1995). The cases Lamb relies on all relate to exculpatory clauses, however, "Pennsylvania appellate courts recognize that there are differences between a contract which insulates a party from liability and one which merely places a limit upon that liability." Id. (citing DeFrancesco v. Western Pa. Water Co., 329 Pa.Super. 508,
478 A.2d 1295, 1306 (1984)). Indemnity and exculpatory provisions are "disfavored and must meet certain conditions to be enforceable." Id. Because the difference between these provisions and a limitation of liability clause "is ... a real one," there are "no Pennsylvania cases in which a limitation of liability clause has been disfavored or been tested by the same stringent standards developed for exculpatory, hold harmless, and indemnity clauses." Id. (quoting Posttape Assocs. v. Eastman Kodak Co., 537 F.2d 751, 755 (3d Cir. 1976)).
"[U]nder Pennsylvania law, contractual provisions ... excluding liability for special, indirect and consequential damages are generally valid and enforceable." New York State Elec. & Gas Corp. v. Westinghouse Elec. Corp., 387 Pa.Super. 537, 564 A.2d 919, 924 (1989); Valhal, 44 F.3d at 204 ("[L]imitation of liability clauses are not disfavored under Pennsylvania law" as they "are a way of allocating 'unknown or undeterminable risks'" and "are a fact of everyday business and commercial life."); see, e.g., Greenspan v. ADT Sec. Servs. Inc., 444 F. App'x 566, 569 (3d Cir. 2011) (collecting cases); Eimco Corp. v. Joseph Lombardi & Sons, 193 Pa.Super. 1, 162 A.2d 263, 266 (1960) (manufacturer's limitation of liability enforced against buyer-contractor); Posttape, 537 F.2d at 755 (film manufacturer's limitation of liability enforced against producer); Shafer v. Reo Motors, Inc., 205 F.2d 685, 687-88 (3d Cir. 1953) (manufacturer's limitation of warranty enforced against buyer).
Liability limiting clauses are enforced, provided they are "reasonable and not so drastic as to remove the incentive to perform with due care." Valhal, 44 F.3d at 204. Lamb urges that the Clause here is unreasonable because, given the nature of the tapes and CVS's advertisements, damages far exceeding the cost of unused tapes were foreseeable. Liability limiting provisions may provide for damages significantly below actual foreseeable damages, however. See Comment to the Restatement of Contracts § 339 ("[T]he contracting parties can by agreement limit their liability in damages to a specified amount, either at the time of making their principal contract, or subsequently thereto. Such a contract, or subsequent thereto, does not purport to make an estimate of the harm caused by a breach; nor is its purpose to operate in terrorem to induce performance.")
As the Third Circuit has noted, Pennsylvania courts "uniformly" uphold liability limiting provisions in favor of installers of home security and burglar alarm systems where "the cap on liability is well below the total amount of" foreseeable damages. Greenspan, 444 F. App'x at 569; see, e.g., LoBianco v. Prop. Prot., Inc., 292 Pa.Super. 346, 437 A.2d 417 (1985) (clause limiting liability of security alarm company upheld against owner whose home was burglarized); Wedner v. Fidelity Sec. Systems, 228 Pa.Super. 67, 307 A.2d 429, 432 (1973) (alarm system installer's liability limited to $312 annual service charge notwithstanding $46,180 in damages suffered by business operator); Magar v. Lifetime, 187 Pa.Super. 143, 144 A.2d 747, 748 (1958) (alarm installer's limitation of liability enforced against private homeowner). Damages are regularly limited to the cost of the device or installation even though the probable damages resulting from a breach of contract could be large given the value of stolen items. I will assume, arguendo, that the loss of Lamb's tapes is as serious as a home invasion (although the latter obviously presents the risk of vastly greater harm). The uniform upholding of damages limitations respecting such security devices compels the same result here.
Lamb next argues that the provision is unenforceable because neither
she nor Austin read or signed the Customer Receipt. (Doc. No. 43 at 12-13.) Given the astonishing importance they attach to the tapes, however, that statement seems dubious, to say the least. I will nonetheless credit the statement, as I must at summary judgment. Absent fraud, failure to read a release is "an unavailing excuse or defense and cannot justify an avoidance, modification, or nullification of the contract." Scott-Moncrieff v. Los Trails, LLC, No. 3:16-cv-1105, 2018 WL 4110742, at *6 (M.D. Pa. Aug. 29, 2018) (quoting Germantown Sav. Bank v. Talacki, 441 Pa.Super. 513, 657 A.3d 1285, 1289 (1995)). Accordingly, Austin's after-the-fact, self-serving affidavit in which he states that he did not read or understand the meaning of the release—and Lamb's statement to the same effect—is not enough to defeat summary judgment. See Paladino, 885 F.3d at 208 (self-serving affidavit insufficient on own to defeat summary judgment); Hess v. Allstate Ins. Co., 614 F. Supp. 481, 485 (W.D. Pa. 1985) ("[A]n insured may not avoid the effect of a clear and unambiguous exclusion clause in an insurance contract by showing that it was either unaware or did not understand the effect of the exclusion") (citing Standard Venetian Blind Co. v. Am. Empire Ins. Co., 503 Pa. 300, 469 A.2d 563, 564, 566-67 (1983)). Moreover, "Pennsylvania law does not condition enforcement of a limitation of liability provision upon any specific form of consent, and an unsigned contract can include an enforceable agreement to limit liability if both parties manifest their approval of the terms." DiPietro v. Glidewell Lab'ys, No. 07-cv-1591, 2011 WL 5403568, at *3 (M.D. Pa. Nov. 8, 2011) (quoting Valhal, 44 F.3d at 201).
In DiPietro, the court denied summary judgment because the liability limiting clause appeared on the back of the prescription form the plaintiff used to acquire products, and the front of the form had no indication that the reverse side included any additional terms. Id. By contrast, here, the Liability Limiting Clause is conspicuous—it covers half of the front side of each of the sixteen receipts given to Austin. The text reading "Please Read Limit of Liability on This Receipt" is large, and "READ THIS NOTICE" is written in capital letters. Cf. Tareila v. Scandanavian World Cruises (Bahamas) Ltd., No. 84-cv-5626, 1985 WL 3773, at *1 (E.D. Pa. Nov. 14, 1985) (upholding liability limiting provision on cruise ticket and receipt directing parties in bold to read ticket carefully); Strauss by Strauss v. Norwegian Caribbean Lines, Inc., 613 F. Supp. 5, 8 (E.D. Pa. 1984) (enforcing liability limiting provision on cruise ticket where ticket contained conspicuous notice directing passenger's attention to contractual provisions). Austin was given the Receipts and left without objection before CVS mailed the tapes. See Dolan Mechanical, Inc. v. Thackray Crane Rental, Inc., No. 21-cv-3020, 2022 WL 3452747, at *5 (E.D. Pa. Aug. 18, 2022) (signature not necessary where receipt provided terms, party did not object, and party continued with transaction). Moreover, Austin filled out sixteen separate Home Movie Transfer Order Forms—each of which required a signature and list a similar liability limiting clause. (Doc. No. 42 at 52-53.) As with security system decisions, where the insured "had a choice as to how to protect his property," here, too, Austin had a choice as to whether or not to convert the tapes, and where to have them converted. Wedner, 307 A.2d at 431. In sum, Austin manifested approval as a matter of law.
Lamb next urges that the Liability Limiting Clause is unenforceable because it does not sufficiently identify CVS as a covered party. (Doc. No. 43 at 14.) "It is well established that the language of a contract clause which limits liability coverage must be clear and precise in order to
prevent unfair surprise." Hess, 614 F. Supp. at 485 (citing Bishop v. Washington, 331 Pa.Super. 387, 480 A.2d 1088, 1095 (1984)). Where "the language of the contract is clear and unambiguous, a court is required to give effect to that language." Id. "The language of a contract is unambiguous if we can determine its meaning without any guide other than a knowledge of the simple facts on which, from the nature of the language in general, its meaning depends." State Farm Fire & Cas. Co. v. PECO, 54 A.3d 921, 928 (Pa. Super. Ct. 2012) (quoting Baney v. Eoute, 784 A.2d 132, 136 (Pa. Super. Ct. 2001)). "When terms in a contract are not defined, we must construe the words in accordance with their natural, plain, and ordinary meaning." Id. (quoting Cordero v. Potomac Ins. Co. of Illinois, 794 A.2d 897, 900 (Pa. Super. Ct. 2002)). I "will not modify the plain meaning of the words under the guise of interpretation or give the language a construction in conflict with the accepted meaning of the language used." Id.
By contrast, a "contract is ambiguous if it is reasonably susceptible of different constructions and capable of being understood in more than one sense." Nissley v. Candytown Motorcycle Club, Inc., 913 A.2d 887, 889-90 (Pa. Super. Ct. 2006); see also Musisko v. Equitable Life Ins. Co., 344 Pa.Super. 101, 496 A.2d 28, 31 (1985) (contract ambiguous if "reasonably intelligent persons ... would differ regarding its meaning"). "If extrinsic evidence will aid in the resolution of ambiguities, the court must look to it." DiFabio v. Centaur Ins. Co., 366 Pa.Super. 590, 531 A.2d 1141, 1142 (1987). "[A] court will only construe ambiguous language against the drafter in the absence of relevant extrinsic evidence." 12th St. Gym, Inc. v. Gen. Star Indem. Co., 93 F.3d 1158, 1166 (3d Cir. 1996); see Hutchison v. Sunbeam Coal Corp., 513 Pa. 192, 519 A.2d 385, 391-92 n.2 (1986).
The clause at issue here is unambiguous. The Receipts are printed with CVS Pharmacy letterhead and stamped with the CVS location. (See Doc. No. 42 at 99-114); Muller v. Aquatic and Fitness Center, No. 1636 EDA 2014, 2015 WL 7430572, at *6 (Pa. Super. Ct. Mar. 9, 2015) ("contract having been presented ... on letterhead bearing [defendant's] name" supports contract being sufficiently particular as to who is released from liability). The Liability Limiting Clause also states: "NOT RESPONSIBLE FOR MEDIA LEFT OVER 30 DAYS." Because customers may pickup and drop-off videos only at CVS, the Clause clearly refers to CVS in its role as a retailer or agent of Fujifilm. A retailer is "[a] person or entity engaged in the business of selling personal property to the public or to consumers." "Retailer." Black's Law Dictionary (11th ed. 2019); see also "Retailer." Oxford Dictionaries Online, https://premium.oxforddictionaries.com/us/definition/american_english/vendor (last visited Nov. 28, 2023) (retailer means "[a] person or business that sells goods to the public in relatively small quantities for use or consumption rather than for resale"). A retailer may also sell "services that are acquired for family or personal use." Idaho Sheet Metal Works, Inc. v. Wirtz, 383 U.S. 190, 203, 86 S.Ct. 737, 15 L.Ed.2d 694, (1966). Here, CVS sells Fujifilm conversion services and DVDs to customers. As a result, CVS is plainly a retailer of Fujifilm goods and services and is thus covered by the clause.
Even if I found the Clause ambiguous, undisputed extrinsic evidence supports my finding. First, by identifying Fujifilm as a third-party vendor, CVS demonstrates again that it is a retailer. (See Doc. No. 42 at 46); Oberdorf v. Amazon.com Inc., 818 F. App'x 138, 139-40 (3d Cir. 2020) (referring to Amazon as retailer that sells products of third-party vendors).
Second, read together with the almost identical liability limiting clause found on the home movie transfer envelope and form, the Liability Limiting Clause on the Receipt is not reasonably susceptible to a construction by which CVS is not covered. (See Doc. No. 42 at 52-53, 99-114.)
Finally, Lamb argues that the Clause should not apply here because CVS's conduct may be willful or wanton. (Doc. No. 43 at 7-8, 14.) Pennsylvania law prohibits enforcement of exculpatory and liability limiting clauses for grossly negligent, willful, or wanton behavior. Valhal, 44 F.3d at 204; see, e.g., Valley Forge Con. & Visitors v. Visitor's Serv., 28 F. Supp. 2d 947, 950 (E.D. Pa. 1998); Fidelity Leasing Corp. v. Dun & Bradstreet, Inc., 494 F. Supp. 786, 789 (E.D. Pa. 1980); Public Serv. Enter. Group, Inc. v. Phila. Elec. Co., 722 F. Supp. 184, 205 (D.N.J. 1989) (applying Pennsylvania law). "Pennsylvania courts have defined gross negligence as 'a failure to perform a duty in reckless disregard of the consequences or with such want of care and regard for the consequences as to justify a presumption of willfulness or wantonness.'" Home Indem. Co. v. Nat'l Guardian Sec. Servs. Corp., No. 94-cv-4964, 1995 WL 298233, at *3 (E.D. Pa. May 11, 1995) (quoting Williams v. State Civil Serv. Comm'n, 9 Pa.Cmwlth. 437, 306 A.2d 419, 422 (1973), aff'd, 457 Pa. 470, 327 A.2d 70 (1974)).
There is no evidence that CVS behaved in a willful or wanton manner. Lamb bases her contention on statements purportedly made in after-the-fact inadmissible settlement discussions. (Doc. No. 43 at 7-8); see Fed. R. Evid. 408; Liptok, 2016 WL 6818362, at *12. In any event, this evidence shows that, even though CVS could not provide specifics of its investigation, the tapes were lost after they left the CVS store, and CVS made an effort to find them. This hardly shows that CVS acted grossly negligent, willfully, or wantonly.
Accordingly, damages in this case will be limited by the Liability Limiting Clause on each of the sixteen Receipts.
V. CONCLUSION
In sum, I will grant CVS's Motion for Partial Summary Judgment.
* * *
AND NOW, on this 30th day of November, 2023, it is hereby ORDERED that Defendant's Motion for Partial Summary Judgment (Doc. No. 42) is GRANTED.