Karim v. American Airlines Inc.

          REPORT AND RECOMMENDATION

          ERIC J. MARKOVICH UNITED STATES MAGISTRATE JUDGE.

         This is a premises liability and negligent training and supervision action against Defendant American Airlines, Inc. (“American Airlines” or “Defendant”) and ten unnamed Defendants brought by Plaintiff Hemayeth Karim. (Doc. 1-1 Ex. A at ¶¶ 33- 50). Pending before the Court is Defendant's Motion for Summary Judgment. (Doc. 21). Defendant requests this Court to dismiss the Complaint in its entirety because workers' compensation is Plaintiff's exclusive remedy against Defendant under Arizona law. Plaintiff filed a Response opposing the motion and claims that because he was not an employee of American Airlines, there is a genuine dispute of material fact as to whether workers' compensation was his exclusive avenue for recovery. (Doc. 28). Defendant filed a Reply and argues that even if Plaintiff is not an employee of American Airlines, ^[1] the Arizona statute still applies because American Airlines provides workers' compensation coverage for all of its wholly owned subsidiaries including Piedmont Airlines, Inc. (Plaintiff's employer) and is self-insured. (Doc. 32).

         Pursuant to the Rules of Practice of this Court, this matter was referred to the undersigned for a Report and Recommendation. (Doc. 8). The motion has been fully briefed, and the Court heard oral argument from the parties on August 9, 2019. For the reasons stated below, the Magistrate Judge recommends that the District Court enter an ordering granting Defendant's Motion for Summary Judgment.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         Plaintiff Hemayeth Karim was employed as a ramp agent for Piedmont Airlines at Phoenix Sky Harbor Airport. (Doc. 23 at ¶ 1; Doc. 29 at ¶ 1). Piedmont is a wholly owned subsidiary of Defendant American Airlines. (Doc. 23 at ¶ 2; Doc. 29 at ¶ 2). Piedmont has its own staff, buildings, aircraft, and gates at Sky Harbor, and Plaintiff receives checks from, and monitors his employment-related documents through, Piedmont. (Doc. 29 at ¶¶ 15-17; Doc. 30 Karim Decl. at ¶¶ 5-12).

         On or about May 28, 2016, Plaintiff alleges that he was injured when a 10, 000-pound Lektro Pushback Tug ran over him and pinned him to the ground “for an extended period of time with tarmac ground temperatures in excess of 125 degrees.” (Doc. 29 at ¶ 3). Plaintiff was acting in the scope of his employment for Piedmont and receiving on-the-job training on the tarmac at the time of this incident and had previously received in-class training. (Doc. 23 at ¶ 4-5; Doc. 29 at ¶ 4-5). Plaintiff was acting as the “wing-walker” during the training while a fellow Piedmont employee, Hunter Landvatter, operated the Tug. (Doc. 23 at ¶ 7; Doc. 29 at ¶ 7). Mr. Landvatter lost control of the Tug while steering and collided with Plaintiff. (Doc. 23 at ¶¶ 8-9; Doc. 29 at ¶¶ 8-9). After the incident Plaintiff received workers' compensation benefits. (Doc. 23 at ¶ 12; Doc. 29 at ¶ 12).

         Plaintiff originally sued Defendants in Maricopa County Superior Court on May 29, 2018, but the case was removed to the Federal District Court for the District of Arizona on October 5, 2018. (Doc. 1). Defendant American Airlines filed an Answer to Plaintiff's Complaint on October 12, 2018 denying any liability. (Doc. 6). Defendant then filed the present Motion for Summary Judgment on March 1, 2019. (Doc. 21).

         II. STANDARD OF REVIEW

         Summary judgment is appropriate when the “pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). A material fact is one that might affect the outcome of the case under governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In addition, a “genuine” issue means that a reasonable jury could find in favor of the nonmoving party. Id. Thus, “there is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party.” Id. at 249. The nonmoving party “may not rest upon mere allegations or denials of [the moving party's] pleadings, but . . . must set forth specific facts showing that there is a genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986) (quoting Fed.R.Civ.P. 56(e)).

         In evaluating a motion for summary judgment, the Court must make all inferences in the light most favorable to the nonmoving party. Anderson, 477 U.S. at 255. Finally, “at the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Anderson, 477 U.S. at 249; see also Musick v. Burke, 913 F.2d 1390, 1394 (9th Cir. 1990) (court may not make credibility determinations or weigh conflicting evidence).

         III. ANALYSIS

         Arizona's constitution directs its legislature to enact a workers' compensation law that requires employers to compensate employees who are injured or die while acting in the scope of their employment if those injuries or deaths are caused by the employer's negligence. See ARIZ. CONST. art. XVIII, § 8. Arizona's workers' compensation statutory scheme, which codified the state constitutional guarantees, provides in relevant part:

The right to recover compensation . . . for injuries sustained by an employee or for the death of an employee is the exclusive remedy against the employer or any co-employee acting in the scope of his employment, and against the employer's workers' compensation insurance carrier or administrative service representative, except as provided by § 23-906, and except that if the injury is caused by the employer's wilful misconduct, or in the case of a co-employee by the co-employee's wilful misconduct, and the act causing the injury is the personal act of the employer, or in the case of a co-employee the personal act of the co-employee . . . and the act indicates a wilful disregard of the life, limb or bodily safety of employees, the injured employee may either claim compensation or maintain an action at law for damages against the person or entity alleged to have engaged in the wilful misconduct.

A.R.S. § 23-1022(A) (emphasis added). Therefore, employers are not liable for negligence damages at common law or by statute so long as they have adequately secured workers' compensation, notified employees of the existence of that compensation, and the damages were not a result of willful misconduct. A.R.S. § 23-906(A). However, an employee has the option to reject the workers' compensation scheme and instead maintain his or her right to sue the employer. Id. In order to maintain this right, the employee must notify the employer of the intention to do so prior to sustaining any injuries. A.R.S. § 23-906(B)-(C). Any employee who does not notify the employer is presumed to have chosen to take workers' compensation. A.R.S. § 23-906(B). Furthermore, “an employee . . . who accepts compensation ...