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Luzerne County

The plaintiffs in this action were nine commercial businesses which all stored documents in the defendant’s West Pittston warehouse. The plaintiffs contended the defendant warehouse operator failed to safely store the documents, resulting in a substantial fire loss. The company which designed and installed the warehouse sprinkler system was also named as a defendant on strict liability and negligence theories. The plaintiff claimed the sprinkler system in the warehouse failed during the fire. The defendant warehouse argued it relied on the codefendant sprinkler system company to design and install adequate fire protection for the building. The codefendant sprinkler company maintained the warehouse was fully aware that connection of the sprinkler system had been delayed until shelving inside the building was completed.

All plaintiffs, except for First Union Bank and Mobil, settled their claims prior their respective damage trials. The warehouse owner as well as three other defendants, an architect, general contractor and fire alarm company also settled prior to the verdict on damages. The settling defendants remained parties to the case for the assessment of liability. The case was bifurcated and tried first by all plaintiffs on liability. The second stage of the trial involved each of the two remaining plaintiff’s separate claims for damages.

The defendant storage company, Diversified Records Services "Diversified," constructed the storage building designated "8.0" in ________-95. In ________ Buildings 8.1 and 8.2 were added to the facility. The buildings, unheated metal structures on concrete foundations, were located across from the defendant’s corporate headquarters in West Pittston. The interior of the buildings consisted of metal storage racks containing cardboard file boxes four tiers high with narrow access aisles.

The defendant Diversified retained the codefendant, Grinnell Fire Protection Systems, Inc., to provide the buildings’ sprinkler systems and fire alarms. When installed and wired into Diversified’s central security station, the alarm systems were designed to electronically alert Diversified’s personnel when a sprinkler head opened and sprayed water.

On May 5, ________, a fire of unknown origin erupted in Building 8.2.

At the time, the sprinkler system to Building 8.2 was not functional. The fire quickly traveled through the separating wall and into Building 8.0, igniting file storage boxes and triggering the sprinkler system in Building 8.0. The sprinkler system of Building 8.0 was overwhelmed and the fire spread to Building 8.1.

The fire ultimately consumed some ________ storage boxes stored in the three buildings.

The plaintiffs argued that millions of banking, trust, administration, acquisition, tax-related and other corporate documents were destroyed by the fire. The plaintiff First Union p 7 3 Bank contended it will suffer loss of income in the future as a result of loss of irreplaceable trust documents. First Union Bank also argued that loss of loan documents prevented it from selling non-performing loans to companies which would otherwise have purchased them.

The plaintiff Mobil Oil claimed it lost the records to support its federal income tax returns as well as a large library of architectural drawings required for its offshore drilling operations.

The defendant Grinnell Fire Protection Systems argued the codefendant Diversified interrupted work on the sprinkler system and began to store its customers’ records before the sprinkler systems were fully operational. Grinnell claimed Diversified was well aware that completion of the sprinkler system for Buildings 8.1 and 8.2 was not complete and was not operational at the time of the fire. Grinnell contended the codefendant did not request that the sprinkler work resume. Grinnell argued that Diversified was filling each storage rack as it became completed. Grinnell also argued it had no duty to protect the plaintiffs’ records against the risks created by Diversified.

In addition, Grinnell maintained it was not contractually obligated to connect and program the sprinkler system alarms with Diversified’s central security and alarm system, work which is typically completed by the alarm contractor not the sprinkler contractor. The alarm contractor previously performed the connection work for the sprinkler system in Building 8, according to Grinnell’s arguments.

The defendant Diversified argued that Grinnell had issued "Material and Test Certificates" in December ________, indicating the fire protection system for the buildings was in service and fully operational. Grinnell additionally issued an invoice to Diversified and been paid for its work, according to evidence offered.

Diversified maintained that, at no time before the fire, did Grinnell properly notify it or the plaintiffs that water to the sprinkler system in Buildings 8.1 and 8.2 had not been turned on and the system was not functional.

The jury found the defendant Diversified 60% negligent and the defendant Grinnell 40% negligent. The jury also found the sprinkler system to have been defectively designed. All other defendants were found not negligent. The plaintiff First Union National Bank, now known as Wachovia Corporation, was awarded $________ in damages. The plaintiff Mobil Oil, now known as Exxon Mobil, was awarded $________. The trial judge denied posttrial motions and awarded delay damages to the plaintiffs in the amount of approximately $11.8 million. Interest is accruing at approximately $________ per day. The case is currently on appeal.

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