Pacific Gas & Electric Co. v. Westinghouse Electric Corp.

MEMORANDUM

Pacific Gas and Electric (“PG & E”) timely appeals the district court’s grant of summary judgment to CBS Corporation f7k/a Westinghouse Electric Corporation (“Westinghouse”). PG & E sued for breach of express contractual warranty because of metal cracking discovered in turbine rotors it had purchased from Westinghouse. The district court held that PG & E’s claim was barred by the California statute of limitations. Because the parties are familiar with the facts and procedural history of this case, it is unnecessary to recount it here.

Under California law, the applicable statute of limitations is four years from the time the warranty breach was discovered. Cal. Com.Code § 2725(1) (West Supp.2000). The pivotal question in this appeal is when the cause of action for breach of warranty accrued. Under California law, when “a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance!,] the cause of action accrues when the breach is or should have been discovered.” Id.

*625 The district court erred in holding that PG & E should have discovered the breach in 1992. Although PG & E expressed concern…