United States District Court, D. Arizona
ORDER
G.
MURRAY ENOW CHIEF UNITED STATES DISTRICT JUDGE
Pending
before the Court is Defendant Honeywell International
Incorporated (“Honeywell's”) Motion to
Dismiss for Failure to State a Claim (Doc. 19). For the
following reasons, the Motion is denied.
BACKGROUND
Sky Jet
AG (“Sky Jet”) owned and operated a Hawker Model
125-8000 Aircraft. (Doc. 13 at ¶ 5). In 1993, Sky Jet
purchased this aircraft. (Id. at ¶ 6). To
ensure the aircraft was properly maintained, Sky Jet has
continuously contracted with Honeywell for support services.
(Doc. 13 at ¶ 8). Two of these maintenance service plans
are at issue here: the 2006 MSP Contract, and the 2013 MSP
Contract. (Doc 13 at ¶ 14; Doc. 13-1). The 2013 MSP
Contract contains a limited liability provision, which
provides that “IN NO EVENT SHALL HONEYWELL BE LIABLE
FOR CONSEQUENTIAL OR INCIDENTAL DAMAGES.” (Doc. 13-1 at
13).
In
2006, Honeywell replaced the aircraft's electronic engine
controller with a digital engine controller. (Doc. 13 at
¶ 14). Following this upgrade, the aircraft began to
experience issues that prevented it from operating properly.
(Doc. 13 at ¶ 15). These issues became significantly
worse in 2015, when the aircraft experienced many days on the
ground. (Doc. 13 at ¶ 16). After trying several
different methods to fix the ongoing issues, Honeywell and
Sky Jet agreed to downgrade the digital engine controller
back to the electric engine controller that was replaced in
2006. (Doc. 13 at ¶ 27). This ultimately fixed the
issues that Sky Jet was having with the aircraft. (Doc. 13 at
¶ 28).
In
2017, Sky Jet submitted a formal claim to Honeywell that
sought damages for the malfunctions of the aircraft from 2006
to 2016. (Doc. 13 at ¶ 40). Honeywell rejected Sky
Jet's request, so Sky Jet filed this lawsuit. In its
First Amended Complaint (“FAC”), Sky Jet raises
four grounds for relief: breach of contract, breach of the
covenant of good faith and fair dealing, negligence, and
unjust enrichment. (Doc. 13 at 1).
There
are two issues raised by Honeywell in its Motion to Dismiss
(Doc. 19): (1) whether Sky Jet's claim for consequential
and incidental damages is barred by the limitation-of-loss
language in the 2013 MSP Contract, and (2) whether Sky
Jet's breach of contract claim as to Honeywell's 2006
conduct is barred by the Arizona statute of limitations.
DISCUSSION
I.
Legal Standard
To
survive dismissal for failure to state a claim pursuant to
Federal Rule of Civil Procedure 12(b)(6), a complaint must
contain more than Alabels and conclusions'' or a
''formulaic recitation of the elements of a cause of
action''; it must contain factual allegations
sufficient to Araise a right to relief above the speculative
level.'' Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007). While Aa complaint need not contain
detailed factual allegations . . . it must plead >enough
facts to state a claim to relief that is plausible on its
face.''' Clemens v. DaimlerChrysler
Corp., 534 F.3d 1017, 1022 (9th Cir. 2008) (quoting
Twombly, 550 U.S. at 570). AA claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.''
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing
Twombly, 550 U.S. at 556). The plausibility standard
Aasks for more than a sheer possibility that a defendant has
acted unlawfully. Where a complaint pleads facts that are
>merely consistent with'a defendant's liability,
it 'stops short of the line between possibility and
plausibility of entitlement to relief.'''
Id. (internal citations omitted) (quoting
Twombly, 550 U.S. at 557).
When
analyzing a complaint for failure to state a claim under Rule
12(b)(6), A[a]ll allegations of material fact are taken as
true and construed in the light most favorable to the
nonmoving party.'' Smith v. Jackson, 84 F.3d
1213, 1217 (9th Cir. 1996). However, legal conclusions
couched as factual allegations are not given a presumption of
truthfulness, and Aconclusory allegations of law and
unwarranted inferences are not sufficient to defeat a motion
to dismiss.'' Pareto v. FDIC, 139 F.3d 696,
699 (9th Cir. 1998).
II.
Analysis
A.
Whether the Liability Limitation in the MPC is
Enforceable
In
Arizona, limitation of liability clauses can be held
unenforceable if one party acted fraudulently or in bad
faith. Airfreight Inc. Ltd v. Evergreen Air Center
Inc., 215 Ariz. 103, 110-111, 158 P.3d 232, 239-240 (Az.
Ct. App. 2007). “As a matter of public policy, a party
...