Aris Helicopters, Ltd. v. Allison Gas Turbine General Motors Corporation Bell Helicopter

932 F.2d 825 ARIS HELICOPTERS, LTD., Plaintiff-Appellant, v. ALLISON GAS TURBINE; General Motors Corporation; Bell Helicopter, Defendants-Appellees. No. 90-15278. United States Court of Appeals, Ninth Circuit. Submitted April 10, 1991. * Decided May 9, 1991. Peter Axelrod, Reid, Axelrod & Ruane, Corte Madera, Cal., for plaintiff-appellant. Richard G. Grotch, Coddington, Hicks & Danforth, Redwood City, Cal., for defendants-appellees. Appeal from the United States District Court for the Northern District of California. Before PREGERSON, NOONAN, and THOMPSON, Circuit Judges. NOONAN, Circuit Judge: 1 Aris Helicopters, Ltd. (Aris) brought suit against Bell Helicopter Textron, Inc. and Allison Gas Turbine Division, General Motors Corporation (the defendants). Federal jurisdiction was based upon diversity of citizenship. The federal district court dismissed the complaint for failure to state a claim upon which relief can be granted. We reverse and remand. ALLEGATIONS Aris's complaint alleged the following: 2 The defendants are the designers, manufacturers, sellers, and distributors of the Bell 206L-1 helicopter, which is equipped with an Allison 250-C28 engine, fuel system, fuel…

Aris Helicopters, Ltd. (Aris) brought suit against Bell Helicopter Textron, Inc. and Allison Gas Turbine Division, General Motors Corporation (the defendants). Federal jurisdiction was based upon diversity of citizenship. The federal district court dismissed the complaint for failure to state a claim upon which relief can be granted. We reverse and remand.

ALLEGATIONS

Aris’s complaint alleged the following:

The defendants are the designers, manufacturers, sellers, and distributors of the Bell 206L-1 helicopter, which is equipped with an Allison 250-C28 engine, fuel system, fuel control and governor, collectively known as a Bell Long Ranger. Aris bought a Bell Long Ranger. On August 27, 1987 this helicopter crashed near Cove-lo, California due to a sudden loss of engine power.

The Bell Long Ranger was defective in design, material and manufacture so that it was unreasonably dangerous and unsafe for its intended use. Aris was unaware of its defects.

The crash of the helicopter caused damage to the helicopter itself and a loss of income to Aris along with additional insurance expenses and the expenses of the lease for a substitute helicopter in the total amount of…

concurring:

I concur in the majority opinion. I write separately to set forth in a little more detail what I believe to be the law of California on the question whether property damage, limited to damage to the product itself, may be recovered in a strict liability action.

In Seely v. White Motor Co., 63 Cal.2d 9 , 403 P.2d 145 , 45 Cal.Rptr. 17 (1965), the California Supreme Court held that the plaintiff had not stated a claim in strict liability for damage to the product because there was no evidence of causation. Id. at 19 , 403 P.2d at 152 , 45 Cal.Rptr. at 24 . The court did not hold that recovery in strict liability is not available if the only damage is to the product itself. Seely did hold that “economic loss” is not a loss recoverable in strict liability, but Seely did not hold that damage to the product alone is such an “economic loss.”

The United States Supreme Court in East River S.S. Corp. v. Transamerica Delaval, 476 U.S. 858, 871 , 106 S.Ct. 2295, 2302 , 90 L.Ed.2d 865 (1986), gave Seely a broader reading than its holding. There, in an admiralty case, the Court held that damages for injury to the product itself could not be recovered on a theory of strict…