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Everkrisp Vegetables Inc. v. Otto

United States District Court, North Dakota

April 12, 2013

Everkrisp Vegetables Inc., an Arizona corporation and Bickman Farms, an Arizona general partnership, Plaintiffs,
v.
Bruce Otto; and Crystal Seed Potato Company, a North Dakota corporation, Defendants

For Everkrisp Vegetables Incorporated, named as: Everkrisp Vegetables, Inc./ an Arizona corporation, Plaintiff: Craig E. Johnson, LEAD ATTORNEY, JOHNSON RAMSTAD & MOTTINGER, PLLP, FARGO, ND; Michael D. Martin, LEAD ATTORNEY, MARTIN LAW OFFICE, LAKELAND, FL.

For Bickman Farms, an Arizona general partnership, Plaintiff: Craig E. Johnson, LEAD ATTORNEY, JOHNSON RAMSTAD & MOTTINGER, PLLP, FARGO, ND; Michael D. Martin, PRO HAC VICE, MARTIN LAW OFFICE, LAKELAND, FL.

For Tobiason Potato Company Incorporated, named as: Tobiason Potato Company, Inc./ a North Dakota corporation, Crystal Seed Potato Company, a North Dakota Corporation, Susan Otto, wife, Bruce Otto, husband, Defendants: Charles A. Stock, LEAD ATTORNEY, RUST STOCK RASMUSSON & KNUTSON, P.A., CROOKSTON, MN.

OPINION

Page 1133

MEMORANDUM OPINION AND ORDER DENYING DEFENDANTS BRUCE OTTO AND CRYSTAL SEED POTATO COMPANY'S MOTION TO DISMISS AND FOR SUMMARY JUDGMENT

Ralph R. Erickson, Chief United States District Judge.

Before the Court is Defendants Bruce Otto (hereafter " Otto" ) and Crystal Seed Potato Company, Inc.'s (hereafter " Crystal Seed" ) motion for dismissal and for summary judgment (Docs. #135, 138). Otto contends that he should be dismissed as an individual defendant because he neither owed a duty, nor breached a duty, to Everkrisp. Crystal Seed contends it is entitled to summary judgment on the negligence claim alleged in the Amended Complaint because there is no evidence of breach of a duty and, alternatively, the claim is barred by the economic loss doctrine.

Plaintiffs Everkrisp Vegetables Inc. and Bickman Farms (hereafter collectively referred to as " Everkrisp" ) have filed a brief in opposition to the motion (Doc. #143). Everkrisp contends that Crystal Seed and Bruce Otto were negligent in failing to properly sanitize and disinfect the equipment, containers, and warehouse, which caused the seed potatoes to become infected with bacterial ring rot. Everkrisp alleges that because of the defective seed potatoes, it sustained a loss of its potato crop and it was unable to use the land from 2009 to 2011.

SUMMARY OF DECISION

While the infected seed potatoes were produced and sold by Crystal Seed, Bruce Otto managed the day-to-day operations of the business and there is evidence from which a reasonable jury could find him personally negligent for failing to sanitize and disinfect the equipment, containers, or the warehouse, which allowed the tubers to

Page 1134

become infected. There is also a genuine issue of material fact as to whether Crystal Seed breached a duty to maintain proper sanitary conditions in the warehouse, in its containers, or on its equipment and whether the breach is a proximate cause of the alleged damages. Thus, Otto and Crystal Seed's motions to dismiss and for summary judgment on the negligence claims are DENIED.

PROCEDURAL BACKGROUND

On May 11, 2011, this Court granted Tobiason Potato Company's motion to dismiss under N.D. Cent. Code ยง 28-01.3-04 (liability of a nonmanufacturing seller) (Doc. #73). In doing so, the Court determined North Dakota law applied in this diversity action. Judgment ...


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