Pycsa Panama, S.A. v. Tensar Earth Technologies
Pycsa Panama, S.A. v. Tensar Earth Technologies, 625 F.Supp.2d 1198 (S.D. Fla. 2008), aff'd, 329 Fed. Appx. 257 (11th Cir. 2009).
Following the deadly collapse of a roadway retaining wall in the Republic of Panama, the company in charge of the construction project, Pycsa Panama, S.A., filed a $44 million lawsuit against the Atlanta-based wall component supplier, Tensar Earth Technologies, Inc., alleging that Tensar was liable for the collapse. After considering the laws of Panama, Georgia, and Florida and their application to the facts of this suit as well as the arguments of counsel, the U.S. District Court for the Southern District of Florida issued a 98-page opinion in which it granted summary judgment on all counts in favor of Tensar.
Rumberger, Kirk & Caldwell, P.A represented Tensar in the case.
The Plaintiff, Pycsa, had a contract with the government of Panama to build a tollroad around the country’s capital. A Pycsa affiliate, acting as the general contractor, purchased Tensar products for the construction of various retaining walls along the highway. In December of 2003, one of the retaining walls collapsed leading to the deaths of three Panamanian children. The Ministry of Public Works in Panama investigated the incident and blamed the collapse on improper construction practices, and also assessed a fine against PYCSA. Two years later, Pycsa filed a four-count products liability action against Tensar consisting of strict liability, negligence, negligent hiring, and negligent supervision. Specifically, Pycsa claimed that Tensar negligently designed the retaining wall, failed to provide defect-free products, and that Tensar’s distributor and licensee in Panama, Fundaciones, negligently installed the retaining wall causing it to collapse. Pycsa claimed $44 million in damages, consisting of lost profits, delay damages, demolition costs, reconstruction costs, idle machinery costs and interest, among others.
At the conclusion of the discovery period, Tensar moved for summary judgment, arguing that Panama law should be applied to bar Pycsa's negligence and strict products liability claims. The defense also argued that Florida law barred the negligent hiring and supervision counts as Pycsa did not have any evidence that Fundaciones was Tensar’s agent. Tensar further moved for summary judgment on Pycsa's lost profits and delay damages claims - arguing that these were too speculative as a matter of law - and on Pycsa’s $10.5 million damage claim belonging to general contractor affiliate.
The parties’ summary judgment briefs included extensive choice-of-law analysis on Panama, Florida, and Georgia law. In support of Panama law, the parties presented affidavits by former Justices of the Panamanian Supreme Court and held an 8-hour evidentiary hearing on the issue of Panamanian law in which the former Justices were cross-examined by counsel and the Court. Further, the District Court ordered additional briefing on the effect of the economic loss doctrine of Florida, Georgia, and Panama, as well as the applicability of the "Conditions of Sale" on back of the Tensar invoices to Pycsa’s products liability claims. In its 98-page opinion, the District Court granted summary judgment on all counts, finding that Panama law bars Pycsa’s negligence and strict liability claims and that Florida law bars the counts for negligent hiring and supervision. The Court has reserved jurisdiction to award costs to the prevailing party.