Delaware Federal Court Dismisses Negligent Misrepresentation Claims Against Engine Manufacturers for Failure to Conform to the Heightened Pleading Standards for Claims Sounding in Fraud

Schnader Harrison Segal & Lewis LLP

Schnader Harrison Segal & Lewis LLPPlaintiffs, surviving family and estate representatives of two decedents killed in an airplane crash in June 2017, brought suit in federal court in Delaware against various manufacturers. Plaintiffs brought negligent misrepresentation claims against three of the defendants. Defendants moved to dismiss on the grounds that plaintiffs failed to plead their claims with the requisite particularity.

Claims for negligent misrepresentation under Delaware law must sufficiently allege that: (1) “the defendant had a pecuniary duty to provide accurate information”; (2) “the defendant supplied false information”; (3) “the defendant failed to exercise reasonable care in obtaining or communicating the information”; and (4) “the plaintiff suffered a pecuniary loss caused by justifiable reliance upon the false information.” If a negligent misrepresentation claim is pled in a manner that sounds in fraud then the claim must meet the elevated requirements of Federal Rule 9(b), which requires a plaintiff to plead the circumstances constituting fraud or mistake with particularity.

The plaintiffs alleged, in part, that “Defendants made misrepresentations and omissions about the safety of [their] products – misrepresentations that … were made despite Defendants’ actual knowledge of the unreasonably dangerous nature of those products … and Defendants were thus guilty of having committed fraud.” While under the heading of Negligent
Misrepresentation, the Court determined the plaintiffs’ claims sounded in fraud and thus were subjected to the heightened pleading standards of Rule 9(b), requiring Plaintiffs to “plead or allege the date, time and place of the alleged fraud or otherwise inject precision or some measure of substantiation into a fraud allegation.”

Regarding Plaintiffs’ allegations, the Court inquired: “[W]ho made these statements that amounted to misrepresentations or that included such omissions? When, where and to whom were those statements made? What exactly about the statements was false? Or what exactly was omitted from the statements that made them false?” Plaintiffs’ failure to provide this information amounted to a failure to plead with particularity pursuant to Rule 9(b). The Court granted the Defendants’ motion to dismiss the negligent misrepresentation claims without prejudice.

King highlights the importance of analyzing whether claims sounding in fraud, including those presented as negligent misrepresentation claims, are pled with the sufficient particularity. King v. Pratt & Whitney Canada Corp., No. 20-cv-359, 2021 U.S. Dist. LEXIS 30728 (D. Del. Feb. 19, 2021)

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