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American Family Mutual Insurance Co. v. TAMKO Building Products, Inc.

United States District Court, D. Colorado

April 13, 2016

AMERICAN FAMILY MUTUAL INSURANCE COMPANY, a Wisconsin Corporation, Plaintiff,
v.
TAMKO BUILDING PRODUCTS, INC., a Missouri Corporation, Defendant.

ORDER GRANTING MOTION TO COMPEL ARBITRATION

ROBERT E. BLACKBURN, UNITED STATES DISTRICT JUDGE

The matters before me are (1) Defendant TAMKO Building Products, Inc.’s Motion To Dismiss or Compel Arbitration [#14], [1] filed October 29, 2015; and (2) Defendant TAMKO Building Products, Inc.’s Motion for Stay Pending Ruling on Its Motion To Dismiss or Compel Arbitration [#29], filed January 27, 2016.[2] I grant the motion to compel arbitration and dismiss this action, mooting consideration of defendant’s motion to stay.

I. JURISDICTION

I have putative jurisdiction over this matter under 28 U.S.C. §§ 1331 (federal question) and 1367 (supplemental jurisdiction).

II. STANDARD OF REVIEW

The decision whether to enforce an arbitration agreement involves a two-step inquiry. First, I must determine whether the parties agreed to arbitrate the dispute. Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473 U.S. 614, 626, 105 S.Ct. 3346, 3353, 87 L.Ed.2d 444 (1985); Williams v. Imhoff, 203 F.3d 758, 764 (10th Cir. 2000). Second, I then must consider whether any statute or policy renders the claims non-arbitrable. Mitsubishi Motors Corp., 105 S.Ct. at 3355; Williams, 203 F.3d at 764.

III. ANALYSIS

This case arises out of the installation of the roofs of two Aurora, Colorado, condominium complexes, referred to herein collectively as “the insureds.” After the roofs were damaged by hail in May 2014, the insureds elected to replace them with “impact resistant” shingles manufactured by defendant. The insureds hired a general contractor to do the work, who, in turn, subcontracted the work to Schall Construction, Inc. (“Schall”), which installed the shingles.

In September 2014, while the installation was still in progress, a second hail storm caused further damage to the roofs, both those portions that had been replaced with defendant’s shingles and those that as yet had not. Thereafter, defendant’s shingles were used to replace both the old roof and the new shingles damaged by the second storm.

At some point soon thereafter, the insureds became aware that defendant’s shingles did not conform to their advertised “Class 4" impact rating. If they had, according to plaintiff, the damage from the September 2014 hail storm to the new shingles “should have been limited to shingles with unique support conditions such as those draped over ridges, hips and valleys.” (Compl. ¶ 8(b).) The insureds made a claim against their insurance policy for the costs of removing and replacing the shingles. Plaintiff, their insurer, paid those claims. It now brings this lawsuit as subrogee of the insureds and asserts claims sounding in negligence, strict liability, breach of express and implied warranties, and misrepresentation.

By this motion, defendant moves to compel arbitration of all plaintiffs’ claims pursuant to an arbitration clause included in a Limited Warranty which was printed on the wrapper of each bundle of shingles. Printed on the wrapper is a prominent, horizontal text box which reads “IMPORTANT, READ CAREFULLY BEFORE OPENING BUNDLE.” Beneath this text is printed, relevantly, the following:

In this paragraph, “You” and “Your” refer to the installer of the shingles and the owner of the building on which these shingles will be installed. This is a legally binding agreement [between] You and TAMKO Building Products, Inc. (“TAMKO”). By opening this Bundle, You agree: (a) to the terms and conditions of the limited warranty in effect for these shingles, including the agreement to arbitrate any and all disputes between you and TAMKO; . . . .

(Def. Motion App., Exh. A-1.) The paragraph concludes by advising, “[i]f you are not satisfied with the terms and conditions of this Limited Warranty, return all unopened marketable product to the original place of purchase for a refund.” (Id.)

The Limited Warranty itself is printed in five columns to the left of this text box. It ...


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