v.
Alltranstek LLC
J-A22025-23 J-A22026-23
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37
AXIALL CORPORATION : IN THE SUPERIOR COURT OF : PENNSYLVANIA : v. : : : ALLTRANSTEK LLC, RESCAR, INC. : T/B/D/A RESCAR COMPANIES AND : SUPERHEAT FGH SERVICES, INC. : No. 966 WDA 2022 : : APPEAL OF: ALLTRANSTEK LLC AND : RESCAR, INC., T/B/D/A RESCAR : COMPANIES :
Appeal from the Judgment Entered August 10, 2022 In the Court of Common Pleas of Allegheny County Civil Division at No(s): GD-18-010944
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37
AXIALL CORPORATION : IN THE SUPERIOR COURT OF : PENNSYLVANIA Appellant : : : v. : : : ALLTRANSTEK LLC; RESCAR, INC., : No. 1016 WDA 2022 T/B/D/A RESCAR COMPANIES; : SUPERHEAT FGH SERVICES, INC :
Appeal from the Judgment Entered August 10, 2022 In the Court of Common Pleas of Allegheny County Civil Division at No(s): GD-18-010944
BEFORE: BOWES, J., OLSON, J., and KING, J. MEMORANDUM BY OLSON, J.: FILED: JUNE 3, 2024 J-A22025-23 J-A22026-23 In this cross-appeal,1 AllTranstek LLC (“AllTranstek”) and Rescar, Inc. t/b/d/a Rescar Companies (“Rescar”) appeal from the August 10, 2022 judgment entered in the Court of Common Pleas of Allegheny County upon a jury verdict in favor of Axiall Corporation (“Axiall”), and against AllTranstek and Rescar. On cross-appeal, Axiall also appeals from the August 10, 2022 judgment, challenging the jury verdict in favor of Superheat FGH Services, Inc. (“Superheat”). In the appeal filed by AllTranstek and Rescar (966 WDA 2022), we affirm the judgment, in part, and vacate the portion of the judgment awarding attorney’s fees in the amount of $8,324,073.25, and we remand this case for further proceedings in accordance with this memorandum. In the cross-appeal (1016 WDA 2022), we dismiss Axiall’s cross-appeal as moot. The trial court summarized the factual history as follows: Axiall owns and operates [a] 564-acre facility [] in Natrium, West Virginia (“the Natrium Plant”), where it manufactures chlorine and other products. The chlorine manufactured at the Natrium Plant is transported exclusively by railroad [tank] car and barge, for which purpose Axiall owns and operates a fleet of railroad tank cars. The Natrium Plant was previously owned and operated by PPG Industries, Inc. (“PPG”), until [a business unit of] PPG merged with Georgia Gulf Corporation [(“Georgia Gulf”)] in 2013 to create Axiall. AllTranstek and Rescar [] performed work for PPG prior to the formation of Axiall. In late August [] 2016, Axiall was acquired by Westlake [Corporation]. AllTranstek provides railroad tank car fleet management services, including the monitoring of fleet movement, ensuring equipment ____________________________________________ 1 For decisional purposes, we sua sponte consolidate the appeals filed with this Court at dockets 966 WDA 2022 and 1016 WDA 2022.
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condition, managing regulatory requirements, and auditing repair and mileage activity. AllTranstek provided these services to PPG and continued to do so under year-to-year “contracts” with Axiall. These contracts came in the form of purchase orders, which the jury found to incorporate by reference Axiall’s Purchase Order General Conditions (“Terms and Conditions”). Under these contracts, Axiall retained AllTranstek to manage the inspection and maintenance of Axiall’s fleet of [railroad tank cars]. Axiall relied upon AllTranstek’s expertise and knowledge of the regulatory landscape that governed [railroad tank car] maintenance. Rescar provides railroad tank car maintenance services including, among other things, mechanical repair, exterior painting, interior coating, and cleaning. As with AllTranstek, Axiall contracted with Rescar to provide these maintenance services using similar purchase orders that incorporated Axiall’s Terms [and] Conditions.
The railroad tank car at issue in this case, AXLX 1702, was built [] in June 1979, [] and is a DOT 105A500W pressure [railroad] tank car[.2 AXLX 1702, in this case,] was constructed of non-normalized steel and equipped with an ACF200 stub sill underframe. Non-normalized steel was commonly used in constructing [railroad] tank cars, such as AXLX 1702, prior to 1982. Axiall and PPG used AXLX 1702 to transport chlorine from 1979 until 2013 when a division of PPG was “spun off” and merged with Georgia Gulf to form Axiall. AXLX 1702 was requalified per federal regulations for the first time in 2000 by Millennium Rail[, Inc.]
There was significant argument and expert testimony at trial surrounding the reasonableness of Axiall’s continued use of AXLX 1702 in light of its non[-]normalized steel [construction] and [ACF200] stub sill underframe. In 2006, the Federal Railroad Administration (“FRA”) promulgated a Safety Advisory and Corresponding Maintenance Bulletin TC-200 with regard to the use ____________________________________________
2 The United States Department of Transportation (“DOT”) employs a classification system for railroad tank cars that indicates the type of chemical or liquid the railroad tank car is authorized to transport. In this instance, a designation of “DOT 105A500W” indicates that the railroad tank car is a pressurized tank car with top and bottom shelf couplers, with a test pressure of 500 pounds per square inch (“PSI”), and, currently, would be constructed using carbon steel and fusion welding. 49 C.F.R. §§ 179.100 to 179.103-5.
[*3]J-A22025-23 J-A22026-23
of [railroad tank] cars equipped with ACF200 underframes (the “2006 Safety Advisory”). In April [] 2017, months after the incident in question, the Association of American Railroads (“AAR”) promulgated a rule that phased out the use of non-normalized steel [railroad tank] cars for transporting toxic inhalation hazards, such as chlorine gas. [AllTranstek and Rescar] attempted to prove at trial that Axiall was aware, even before the promulgated rule, of the issues with non-normalized steel [railroad tank] cars and that such [railroad tank] cars were no longer manufactured for those reasons. Additionally, evidence presented at trial showed that Axiall was aware of the 2006 Safety Advisory and that many of [its railroad] tank cars may have had cracks around their stub sill [under]frames. Thus, [AllTranstek and Rescar] attempted to show at trial that Axiall’s knowledge of these potential defects in a [railroad tank] car like AXLX 1702, [together with Axiall’s failure to take remedial action], established Axiall’s contributory negligence in the ultimate rupture of the [railroad] tank [car]. The jury ultimately apportioned 40% of fault to Axiall.
In 2010, Rescar performed a federally required ten-year qualification inspection on AXLX 1702. The [railroad tank] car was then shipped straight from [Rescar’s inspection facility] to Texana Tank to be re-jacketed in 2010. Texana Tank did other work on AXLX 1702, including post[-]weld heat treatment. In February [] 2016, AXLX 1702 was sent to Rescar’s DuBois[, Pennsylvania] facility for a five-year interim inspection required on chlorine tank cars in accordance with Axiall’s maintenance manual and Axiall’s [shipping] instructions. Rescar’s work included cleaning, thickness testing, build-up welding for corrosion repair, post-weld heat treatment, and hardness testing. The interior inspection of AXLX 1702, performed by Rescar[ at its Dubois facility], revealed many corroded areas on the interior of the tank shell that fell below Axiall’s minimum tank shell thickness requirements. Due to the extensive nature of the repairs, a repair estimate of approximately $58,000[.00] was provided to Axiall for approval.
After Axiall[ approved] the repairs to AXLX 1702, Rescar employees repaired the corroded areas on the interior of the tank shell by welding in May [] 2016. After weld repairs [were performed], and consistent with the applicable procedures and regulations, local post-weld heat treatment was performed. [Local post-weld heat treatment] is performed after welding is completed on a [railroad tank car] in an effort to reduce and redistribute the residual stresses present in the steel after
[*4]J-A22025-23 J-A22026-23
welding. The process involves placing ceramic fiber heating pads on the areas of the tank shell where weld repairs were performed in order to heat the metal [] to a particular temperature, hold that temperature for three hours, and then control the [cooling] of the metal. Thermocouples must be centered under each heating element to monitor the temperatures reached during [local post-weld heat treatment.] Insulation is placed on the opposite side of the tank shell during the process.
Prior to the [local post-weld heat treatment performed] on AXLX 1702 [] in 2016, Rescar entered into a contract with Superheat whereby Superheat provided certain [local post-weld heat treatment] equipment to Rescar and remotely monitored the temperatures reached during the [local post-weld heat treatment] process from its facility located in Kincardine, Ontario[, Canada]. The [local post-weld heat treatment] of AXLX 1702 in 2016 occurred on six dates in late May and early June. Superheat’s function was to monitor the temperatures and [local post-weld heat treatment] equipment power outputs during [local post-weld heat treatment] and advise Rescar[’s] technicians of potential issues evident through the monitoring of this data. While Rescar was responsible for most of the maintenance work, Superheat was responsible for monitoring the [local post-weld heat treatment] of the railroad tank car, and AllTranstek was responsible for inspecting the work [upon completion]. While Axiall alleged that Superheat negligently failed to perform a successful [monitoring of the local post-weld heat treatment], the jury found no liability on the part of Superheat. Axiall also alleged that the AllTranstek inspector assigned to [] Rescar[’s] DuBois facility[] failed to conduct any in-process inspections in connection with the work performed on AXLX 1702.
On July 20, 2016, [the AllTranstek inspector] performed a final inspection of AXLX 1702 and declared [the railroad tank car] fit for return to chlorine [transport] service. This final inspection included a review of the [railroad tank] car file associated with AXLX 1702 indicating that it is constructed of non-normalized steel and is equipped with an ACF200 stub sill [underframe]. The inspection failed to include an interior inspection [of the tank] and a stub sill [underframe] inspection. [Rescar] argued at trial that the purpose of this five-year inspection was principally to conduct a cleaning inspection of the interior [of the railroad tank car], rather than a federal qualification inspection in which the stub sill [underframe] would have been inspected.
[*5]J-A22025-23 J-A22026-23
On August 27, 2016, AXLX 1702 was loaded with liquid chlorine at the Natrium [Plant] for the first time after the maintenance work performed by Rescar and Superheat. Shortly thereafter, the tank ruptured, causing a pre-existing crack to widen and rupture, out of which escaped more than 178,000 pounds of liquid chlorine into the atmosphere. The liquid chlorine vaporized and formed a plume of chlorine gas that spread across much of Axiall’s Natrium chloralkali plant in Proctor, West Virginia, as well as neighboring properties. There were only minor injuries to some employees who were exposed at the time of the release.
Axiall filed its complaint [against AllTranstek, Rescar, and Superheat] on August 24, 2018. In addition to [causing] lawsuits [to be filed by third parties] against Axiall for the damage to [neighboring] properties, Axiall claimed that the rupture and leakage caused hundreds of millions of dollars of damage to its own property. Axiall alleged that both AllTranstek and Rescar agreed to and breached Axiall’s [T]erms and [C]onditions by failing to properly perform their respective work and inspect the same. Additionally, Axiall alleged that AllTranstek and Rescar were negligent in their respective work on AXLX 1702. A National Transportation Safety Board (“NTSB”) inspection after the incident concluded that the probable cause [of the railroad tank car rupture and ensuing leak] was an undetected, subsurface, pre-existing crack near the inboard end of the stub sill cradle pad.
This case was ultimately tried by [a] jury for approximately six weeks. . . . The jury ultimately returned a verdict on October 18, 2021, in favor of Axiall on its contract and tort claims. Specifically, on Axiall’s claim for negligence, the jury apportioned 40% fault to Axiall contributorily, 20% [fault] to AllTranstek, 40% [fault] to Rescar, and 0% [fault] to Superheat. The jury awarded [$12,800,000.00] in damages.
Trial Court Opinion, 12/21/22, at 2-7 (extraneous capitalization omitted).
On October 25, 2021, AllTranstek and Rescar jointly filed a motion for post-trial relief, requesting, inter alia, that the trial court enter judgment non-obstante veredicto, or, alternatively, “remit the verdict to an amount commensurate with the damages[.]” AllTranstek and Rescar Post-Trial
[*6]J-A22025-23 J-A22026-23
Motion, 10/25/21, at 3-23. The post-trial motion also included a motion to mold the verdict to the amount of $7,680,000.00, which, according to
AllTranstek and Rescar, reflected the amount of factual cause attributed by the jury to both AllTranstek and Rescar, combined. Id. at 23. That same
day, Axiall filed a motion to mold the verdict, requesting, inter alia, that the trial court “find any casual negligence attributed to [Axiall] by the jury does
not reduce the verdict awarded to it” on its breach of contract and breach of warranty claims. Axiall Post-Trial Motion, 10/25/21, at 7-8.
On November 3, 2021, Axiall filed a second motion for post-trial relief, seeking a new trial, or, alternatively, judgment non-obstante veredicto. Axiall
Post-Trial Motion, 11/3/21. In its motion for a new trial, Axiall asserted that
the trial court improperly admitted evidence related to non-normalized steel, ACF200 stub sill underframes, remedial actions by Axiall, and post-rupture changes to regulations and industry guidance, as well as testimony from
AllTranstek’s and Rescar’s expert. Id. at 2-6. Axiall requested judgment non-obstante veredicto on the contributory negligence claims forwarded by
AllTranstek, Rescar, and Superheat on grounds that the defendant-parties
failed to establish that Axiall was contributorily negligent in the cause of the AXLX 1702 rupture. Id. at 6-7. That same day, Superheat filed a post-trial
motion, requesting that, in the event the trial court were to grant a new trial, the trial court should enter judgment in favor of Superheat as a matter of law, on the grounds the jury found in favor of Superheat concerning Axiall’s J-A22025-23 J-A22026-23 negligence claim against Superheat. Superheat Post-Trial Motion, 11/3/21, at 3-9 (unpaginated).
[*7]On November 12, 2021, AllTranstek and Rescar jointly filed a motion to
strike Axiall’s motion for post-trial relief, together with a joint response in opposition to Axiall’s motion to mold the verdict. On November 17, 2021, Superheat filed a motion to strike, or, alternatively, to deny, Axiall’s motion for post-trial relief. Axiall filed an omnibus response in opposition to the motions to strike on November 29, 2021.
After the submission of briefs supporting and opposing the pending post-trial motions, the trial court, on February 16, 2022, denied Axiall’s request for a new trial and entry of judgment non-obstante veredicto. Trial
Court Order, 2/16/22, at ¶1. In that same order, the trial court granted
Axiall’s motion for entry of judgment against AllTranstek and Rescar, declaring that both parties are contractually bound to indemnify, defend, and hold Axiall harmless from all damages; granted Axiall’s motion to enter an unreduced verdict of $12,800,000.00 based upon the jury’s finding in favor of Axiall on its breach of contract and breach of warranty claims; granted Axiall’s request for delay damages from August 24, 2019, to October 14, 2021, calculated at the statutory rate of six per cent per annum on 60% of the full verdict, reduced in accordance with the suspension of such calculations due to the COVID-19 global pandemic; granted Axiall’s request for post-judgment interest from
October 14, 2021, to the date payment is effectuated; granted Axiall’s request for attorney’s fees, costs, and expenses, the amount of which was to be
[*8]J-A22025-23 J-A22026-23
determined at a future evidentiary hearing; and denied Axiall’s request for pre-judgment interest. Id. at ¶¶2-3. In a separate order, entered on
February 16, 2022, the trial court denied the motions for post-trial relief filed by AllTranstek and Rescar (jointly), as well as Superheat.
On February 25, 2022, Superheat filed a praecipe for entry of judgment
in favor of Superheat and against Axiall. Judgment in favor of Superheat, and against Axiall, in the amount of $0.00 was entered that same day. On March
9, 2022, Axiall filed an emergency motion to strike the judgment entered in favor of Superheat. On Monday, March 28, 2022, Axiall filed a timely notice
of appeal, which was docketed by this Court at 484 WDA 2022, from the February 25, 2022 judgment entered in favor of Superheat.[3] On June 9, 2022, this Court, in a per curiam order, quashed Axiall’s appeal without prejudice to seek a new appeal once final judgment was entered as to all claims.[4] Per
Curiam Order, 6/9/22 (484 WDA 2022). ____________________________________________
3 See Pa.R.A.P. 903(a) (requiring notice of appeal to be filed within 30 days
after entry of order from which appeal is taken); see also 1 Pa.C.S.A. § 1908 (stating that, whenever the last day of any period of time referred to in a statute “shall fall on Saturday or Sunday, or on any day made a legal holiday by the laws of this Commonwealth or of the United States, such day shall be omitted from the computation”).
4 The entry of judgment as to one party, but fewer than all parties is not a
final judgment from which an appeal may be taken. See Gutteridge v. A.P. Green Serv., Inc., 804 A.2d 643, 650 (Pa. Super. 2002), appeal denied, 829 A.2d 1158 (Pa. 2003); see also Pa.R.A.P. 341(a) and (b)(1) (stating that, a final order from which an appeal may be taken is an order that, inter alia, “disposes of all claims and all parties”). In the case sub judice, the entry of judgment on August 10, 2022, as to the remaining parties, AllTranstek and
[*9]J-A22025-23 J-A22026-23
Meanwhile, on April 12, 2022, Axiall filed a motion for reconsideration of the trial court’s order reducing the award of delay damages in accordance with the suspension of such calculations due to the COVID-19 global pandemic. AllTranstek and Rescar jointly filed a response in opposition to
Axiall’s motion for reconsideration on May 9, 2022.
On August 8, 2022, the trial court awarded Axiall attorney’s fees, costs, and expenses in the amount of $8,324,073.25. That same day, in a separate order, the trial court granted Axiall’s motion for reconsideration and amended the award of delay damages such that the damages would be calculated from
August 24, 2019, through October 14, 2021, at the statutory rate of six per cent per annum on 60% of the full verdict ($12,800,000.00) without reduction due to the COVID-19 global pandemic.
On August 10, 2022, upon praecipe for entry of judgment filed by Axiall, judgment was entered in favor of Axiall and against AllTranstek and Rescar in the amount of $22,589,524.71.5 On August 23, 2022, AllTranstek and Rescar filed a joint notice of appeal, which was docketed by this Court at
966 WDA 2022. On August 30, 2022, Axiall filed a notice of cross-appeal, ____________________________________________
Rescar, resulted in a final, appealable judgment as to all parties, including Superheat.
5 A break-down of the judgment is as follows:
Verdict $12,800,000.00 Attorney’s fees, costs, and expenses $8,324,073.25 Delay damages $403,802.46 Post-judgment interest (through 8/9/22) $1,061,649.00 - 10 - J-A22025-23 J-A22026-23 which was docketed by this Court at 1016 WDA 2022. AllTranstek and Rescar filed a concise statement of errors complained of on appeal pursuant to Pennsylvania Rule of Appellate Procedure 1925(b) on September 13, 2022, and the trial court filed its corresponding Rule 1925(a) opinion on December 21, 2022. Axiall filed its Rule 1925(b) statement pertaining to the cross-appeal on September 20, 2022, and the trial court filed its Rule 1925(a) opinion pertaining to the cross-appeal on December 21, 2022. AllTranstek and Rescar raise the following issues for our review: