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Aerovation, Inc. v. Airtec, Inc.

United States District Court, D. Maryland

August 16, 2019

AEROVATION, INC., Plaintiff/Counter-Defendant/Third-Party Plaintiff,
v.
AIRTEC, INC., Defendant/Counter-Plaintiff, STEVENS AVIATION, INC. and AERY AVIATION, LLC, Third-Party Defendants.

          MEMORANDUM OPINION

          THEODORE D. CHUANG UNITED STATES DISTRICT JUDGE.

         Plaintiff and Third-Party Plaintiff Aerovation, Inc. ("Aerovation") has filed a civil action against Defendant Airtec, Inc. ("Airtec") alleging breach of contract. After Airtec filed counterclaims, Aerovation impleaded Aery Aviation, LLC ("Aery") and Stevens Aviation, Inc. ("Stevens"), alleging Maryland indemnification and contribution claims. Presently pending before the Court are separate Motions to Dismiss filed by Aery and Stevens. Upon reviewing the submitted materials, the Court determines that no hearing is necessary. See D. Md. Local R. 105.6. For the reasons set forth below, Aery's Motion is DENIED, Stevens's Motion is GRANTED, and Aerovation's request for leave to amend the Third-Party Complaint as to Stevens is DENIED.

         BACKGROUND

         In early 2018, Airtec and Aerovation entered into a contract for Aerovation to provide materials for the modification of an Airtec Gulfstream aircraft ("the Aerovation Contract"). Aerovation completed delivery of the materials in April 2018, and Airtec subsequently contracted with Aery to install them. After securing that contract ("the Aery Contract"), Aery subcontracted with Stevens for labor. The installation of the parts was primarily conducted at Stevens's hangar in South Carolina. Aerovation's only contract was with Airtec; it did not have a contract with Stevens or Aery.

         Although Airtec made one payment to Aerovation for the aircraft parts, Airtec did not make full payment to Aerovation as required by the Aerovation Contract. Airtec contends that the strongback component and ventral fin delivered by Aerovation did not meet the contract requirements.

         I. Aery

         Aery, a limited liability company, is headquartered in Newport News, Virginia. It has no offices or employees in Maryland. Aery entered into a contract with Airtec, a Maryland company, in or about early January 2018 to oversee the modification of Airtec's Gulfstream aircraft. Airtec made the initial contact with Aery to discuss the project in November 2017. In turn, Aery submitted at least three formal proposals to Airtec at its offices in California, Maryland, in January, February, and April 2018. Airtec and Aery communicated by telephone, email, and text to discuss the proposed contract. The Aery Contract was executed on January 5, 2018, and pursuant to the contract, four purchase orders totaling more than $2 million were executed between May and October 2018. After the award of the contract, Aery's representatives traveled to Airtec's offices in Maryland six times between January and August 2018. These visits included a meeting within two weeks after the execution of the contract, a meeting to discuss engineering and certification content, a meeting to discuss transportation to the assembly location in Greenville, South Carolina, and separate deliveries of parts, component racks, and a data drive to Airtec.

         Aery's proposals to Airtec sought a Virginia forum selection clause and a choice-of-law clause providing that the contract would be governed by Virginia law. Airtec's standard purchase order for the receipt of services from Aery, however, contained a Maryland choice-of-law clause and a clause providing for mandatory mediation to occur in Maryland. The actual purchase orders issued by Airtec and accepted by Aery incorporated Airtec's standard purchase order by reference.

         After securing the contract for the Gulfstream project at issue, Aery received another contract from Airtec in February 2018, for work referred to as the "King Air" project.

         II. Stevens

         Stevens provided engineering labor and facilities during the installation of the aircraft parts Aerovation provided to Airtec. In its Counterclaim, Airtec states that after Stevens engineers had unsuccessfully attempted to install the parts on the Gulfstream aircraft, Airtec communicated to Aerovation that the parts were not suitable and would require further modification or replacement. According to Aerovation, at Airtec's request, it sent technicians to Stevens's facilities to "provide technical assistance" during the installation. Third-Party Compl. ¶ 15, ECF No. 11. Aerovation contends that if the parts could not be properly installed on the Gulfstream aircraft, this failure was due to the faulty work performed by Aery, Stevens, or both, rather than any defective manufacture by Aerovation. Aerovation further claims that Stevens's engineers lacked the capacity to conduct proper installation. Airtec tendered only partial payment for the materials supplied by Aerovation due to the alleged defects.

         III. Procedural History

         On September 25, 2018, Aerovation filed its Complaint against Airtec for breach of contract due to Airtec's failure to pay for the aircraft parts. Airtec counterclaimed on October 17, 2018 for breach of contract, breach of express warranty, and breach of implied warranty, claiming that the materials did not conform to the contract specifications. In response to Airtec's Counterclaim, Aerovation impleaded Aery and Stevens as third-party defendants, asserting claims for common law indemnification and contribution against both companies.

         DISCUSSION

         In its Motion, Aery seeks dismissal of the claims against it pursuant to Federal Rule of Civil Procedure 12(b)(2) based on a lack of personal jurisdiction. Stevens seeks dismissal of both the indemnification and contribution claims against it pursuant to Federal Rule of Civil Procedure ...


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