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Arakelian v. Verizon New Jersey, Inc.

United States District Court, D. New Jersey, Camden Vicinage

December 21, 2018



          JOEL SCHNEIDER United States Magistrate Judge.

         This matter is before the Court on the “Motion[s] for Summary Judgment” (“Motion”) [Doc. Nos. 29, 14] filed by defendant Verizon New Jersey, Inc. The Court received the opposition filed by plaintiffs Nubar Arakelian [C.A. No. 17-02635, Doc. No. 35] and Dennis Bell a/k/a KBAZ Taste of Philly [C.A. No. 17-12640, Doc. No. 17], and defendant's replies [C.A. No. 17-02635, Doc. No. 38; C.A. No. 17-12640, Doc. No. 18]. Defendant seeks summary judgment on all claims raised in these two consolidated actions. Pursuant to 28 U.S.C. § 636(c), the parties consented to the jurisdiction of this Court to hear the case. [C.A. No. 17-02635, Doc. No. 9; C.A. No. 17-12640, Doc. No. 16]. The Court recently heard oral argument. For the following reasons, defendant's motions are DENIED.


         This is a consolidated action originally filed by plaintiff Nubar Arakelian in federal court. Shortly thereafter, another case was filed by plaintiff Dennis Bell a/k/a KBAZ Taste of Philly (hereinafter, “Bell”) in New Jersey state court. Defendant removed Bell's case to federal court where it was consolidated with the Arakelian case for discovery and case management purposes only. See Order, Dec. 22, 2017 [Doc. No. 21]. Both actions concern the same property and course of events.

         On or about March 25, 2011, Arakelian's limited liability company (“LLC”) - Marara, LLC - entered into a Commercial Lease Agreement with Bell's LLC - KABZ, LLC - for a five (5) year term for a property located at 7801 Maple Avenue in Pennsauken, New Jersey.[1] Arakelian Compl. ¶ 8 [Doc. No. 29-4]. Plaintiff Arakelian alleges he is a Pennsylvania citizen and the sole member of Marara, LLC, which was formed on April 14, 2008. Arakelian Opp. at 16; see id., Ex. J. Plaintiff Bell alleges he is a Pennsylvania citizen and the sole member of KABZ, LLC and KKBAZ, LLC, both of which were formed around mid-2012 and engaged in business as a pretzel bakery and frozen yogurt shop at 7801 Maple Avenue. Letter, Dec. 14, 2018 [C.A. No. 17-12640, Doc. No. 23]; see Bell's Resp. to Def.'s Interrog. Nos. 5, 6 [Doc. No. 18-1]. Bell alleges that KBAZ, LLC and KKBAZ, LLC were dissolved on April 13, 2016. See Bell's Resp. to Def.'s Interrog. Nos. 5, 6. Arakelian stated at oral argument his company, Marara, LLC, was recently dissolved as well but counsel also indicated that, if necessary, plaintiff would revive the LLC for purposes of this litigation.

         Around late 2012 or early 2013, Bell contends his businesses were impeded when he began experiencing problems with plumbing, including “poor drainage, backing up of drainage into the street, and lack of water pressure.” Arakelian Compl. ¶ 9. Despite Arakelian's efforts as landlord to resolve the issue, the problem persisted. On July 31, 2014, Bell contends he was forced to terminate business and vacate the property. Bell Compl. ¶ 3 [Doc. No. 29-4]; see Arakelian Compl. ¶ 11. The building was subsequently quarantined by the Pennsauken Sewer Department due to the backup of drainage into the street. Arakelian Compl. ¶ 12. Sometime in early 2015, Arakelian hired a project manager to investigate possible causes for the plumbing issue. Id. ¶ 13. The investigation ultimately determined that it resulted from defendant's installation of a “Verizon duct conduit bank.” Id. ¶ 14. Specifically, plaintiff was informed defendant and/or its employees, agents, or subcontractors “ripped out a [3 to 4 foot] portion of the Property's sanitary sewer lateral” when it installed the conduit bank. Id. ¶ 15.

         By late 2015, Arakelian was in contact with defendant and its representatives to coordinate the necessary repairs. See Arakelian Opp. at 8-9. Defendant proceeded to file a claim with its insurance carrier, Sedgwick Claims Management Services, Inc., listing Arakelian as the claimant and “[Verizon] conduit installed in 1997 Maple Ave” as the claim. Id., Ex. D. Around the same time, defendant “retained a contractor to rearrange four (4) PVC conduits in front of the property . . . to allow for placement of a new sewer lateral.” Caniglia Cert. ¶ 7 [Doc. No. 29-2]. However, since the remediation, defendant has maintained it is neither at fault nor able to identify the contractor responsible for the conduit's installation and plaintiffs' subsequent injuries and damages. See Arakelian Opp., Exs. E-G.

         Defendant now moves for summary judgment alleging plaintiffs' claims are barred by the New Jersey statute of repose. Defendant also argues that plaintiffs are not the real parties in interest and therefore lack standing to sue. In support of its motion, defendant submits the Certification of Mike A. Caniglia, Verizon's Local Manager of Contract Services whose territory includes plaintiffs' property. See Caniglia Cert. ¶ 1. Caniglia attests he has “personally reviewed the conduit print, ” and asserts that this “section of the conduit was installed in 1997 under work order number 31-4704C.” Id. ¶ 4. Caniglia states the “duct conduit bank was installed as an addition to existing underground conduit in this area in order to expand the availability of Verizon's services for this territory.” Id. ¶ 5. Caniglia also states he is “unaware of any records showing any other underground work performed on this duct conduit bank by Verizon and/or its subcontractor in front of the property since . . . [it] was installed in 1997.” Id. ¶ 8.

         Plaintiffs oppose defendant's motion, contending defendant cannot assert the statute of repose as a defense because it is “a utility provider that 1) installed the conduit in order to expand its business in the geographical area, [who] 2) continues to exert dominion, ownership and control over the conduit and 3) does not fall within the class of persons entitled to repose.” Arakelian Opp. at 2. Plaintiffs further contend that defendant's reliance on Caniglia's Certification is insufficient to support its motion for summary judgment as to the issue of repose. See Bell Opp. at 6.


         A. Summary Judgment Standard

         Summary judgment is appropriate when, drawing all reasonable inferences in the non-movant's favor, there exists “no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); see Anderson v. Liberty Lobby, 477 U.S. 242, 256 (1986). Summary judgment is not appropriate, however, if the dispute over a material fact is “genuine, ” that is, if the evidence is such that a reasonable jury could return a verdict in favor of the non-moving party. Anderson, 477 U.S. at 248. “[T]he substantive law will identify which facts are material.” Id. at 248. Only disputes over facts that weigh on the case's outcome “will properly preclude the entry of summary judgment.” Id. The Court must view all evidence and draw all reasonable inferences in a light most favorable to the non-moving party. See Startzell v. City of Philadelphia, 533 F.3d 183, 192 (3d Cir. 2008) (citation omitted).

         The moving party bears the initial burden of informing the Court of the basis for its motion and demonstrating the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Once satisfied, the burden shifts to the non-moving party to demonstrate “a genuine issue for trial.” Anderson, 477 U.S. at 250 (“[W]hether, in other words, there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party.”). The party opposing summary judgment may not “rest upon mere allegation[s] or denials of his pleading, ” but must set forth specific facts and evidence demonstrating a genuine dispute for trial. Id. at 256; Fed.R.Civ.P. 56(c)(1)(A).

         B. Statute of Repose

         The New Jersey statute of repose, N.J.S.A. 2A:14-1.1(a), provides that:

a. [n]o action . . . to recover damages for any deficiency in the design . . . or construction of an improvement to real property . . . shall be brought against any person performing or furnishing the design, . . . or construction of such improvement . . . more than 10 years after the performance or furnishing of such services and construction. This limitation shall serve as a bar to all such actions.

         The New Jersey Legislature enacted the statute of repose in response to construction-defect cases and with the intent of insulating construction professionals (such as architects, planners, designers, builders, and contractors) from indefinite liability through operation of the discovery rule. The Palisades at Fort Lee Condo. Ass'n, Inc. v. 100 Old Palisade, LLC, 230 N.J. 427, 453 (2017) (citing Town of Kearny v. Brandt, 214 N.J. 76, 93 (2013)). “Unlike a statute of limitations, the statute of repose ‘does not bar a cause of action; its effect, rather, is to prevent what might otherwise be a cause of ...

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