Date of Verdict: April 30.

Court and Case No.: U.S. District Court for the Eastern District 2:09-cv-02948.

Judge: L. Felipe Restrepo.

Type of Action: Products liability.

Injuries: Property damage.

Plaintiffs Counsel: Raymond E. Mack, Daniel J. de Luca, Nelson, Levine, de Luca & Horst, Blue Bell, Pa.

Defense Counsel: Elizabeth A. Chalik, Marks, O’Neill, O’Brien, Doherty & Kelly, Philadelphia; Patrick J. Moran, Jim H. Fields Jr., William J. Ferren & Associates, Blue Bell, Pa.; Keisha A. Parker, Campbell, Campbell, Edwards & Conroy, Berwyn, Pa.; Gary A. Hurwitz, March, Hurwitz & DeMarco, Media, Pa.

Plaintiffs Expert:Victor Donatelli, automotive, Berea, Ohio.

Defense Expert:Kenneth McLauchlan, engineering, Annapolis, M.D.

Comment: In 2006, co-plaintiffs Timothy and Mary Reese purchased a used Mercury Monterey minivan from Faulkner-Ciocca Ford Mercury in Quakertown, Pa.

The Reeses claimed that Faulkner-Ciocca had acquired the Monterey after arranging a swap with a New Jersey dealership, Magarino Ford-Mercury Inc. As a result of the swap, Faulkner-Ciocca received a fully loaded Monterey from Magarino in exchange for another vehicle.

At the time of the Reeses’ purchase, the vehicle had 129 miles on it. The Monterey came with a new-vehicle limited warranty, which stated that the warranty did not cover damages caused by the installation of a non-Ford part. The Reeses also purchased an extended warranty that advanced the warranty’s coverage period to 72 months, which was the length of the term of the loan the couple took out to pay for the minivan.

The Reeses had the Monterey for approximately three years, logging roughly 33,000 miles on it. During that time, Timothy Reese, a Pep Boys store manager, reportedly performed oil changes, filter changes and tire rotations on the vehicle. He also brought the Monterey in to a Pep Boys location for two state inspections and a fuel filter change.

One evening in May 2009, Timothy Reese drove the Monterey home and parked it in his garage. As he exited the vehicle, he later claimed, he smelled a burning odor, but did not notice any smoke or flames coming out of the car. He proceeded into his house and started to eat dinner with his wife. Shortly thereafter, the Reeses both smelled a burning odor coming from the garage. Timothy Reese opened the door to the garage and saw flames emerging from the front driver’s-side corner of the Monterey. The fire spread and damaged the Reeses’ property.

At the time, the couple had policies with State Farm Fire and Casualty Co. and Allstate Insurance Co., respectively for homeowners’ and vehicular coverage. The two insurers covered the costs stemming from the property damage sustained in the fire.

The Reeses then sued Faulkner-Ciocca and Ford Motor Co., stating causes of action for breach of implied warranty of merchantability, breach of contract, strict liability and negligence.

When the couple learned through discovery that Faulkner-Ciocca had acquired the Monterey from Magarino, the Reeses brought a separate action against Magarino, asserting claims for breach of warranty, strict liability and negligence. Magarino initiated a third-party action against Pep Boys.

The Reeses were later replaced as plaintiffs by State Farm and Allstate in their capacities as subrogees. The only defendant to proceed to trial was Faulkner-Ciocca, because the other claims were dismissed by summary judgment prior to trial.

Prior to trial, the parties stipulated that the fire had originated in an area of the engine compartment that included aftermarket wiring. State Farm and Allstate’s forensic mechanics expert opined that the fire was caused by improper installation of the aftermarket wiring; the wire was described as running from the battery toward the driver’s-side headlight. Because of the improper installation, the expert concluded, the wiring was exposed to a sharp object that, over time, wore through and penetrated the wiring, thereby compromising the integrity of the insulation and resulting in a fire.

The defense maintained that because the vehicle was part of a swap with Magarino, the vehicle was only in Faulkner-Ciocca’s possession for two hours before the Reeses purchased it. Faulkner-Ciocca’s counsel argued that the dealership did not install the aftermarket wiring at issue. Counsel also noted that Reese, an employee of Pep Boys for more than 37 years, had performed maintenance on the vehicle during his possession of the minivan.

Reese testified that he had only performed oil changes, filter changes and tire rotations on the vehicle.

State Farm and Allstate sought to recover approximately $467,000 in compensation for payouts made in conjunction with the Reeses’ fire-related vehicular and residential damage.

The jury found that the Monterey was not defective at the time it was sold to the Reeses by Faulkner-Ciocca. The jurors also determined that Faulkner-Ciocca had not breached the implied warranty of merchantability.

— This report first appeared in VerdictSearch, an ALM publication. •