                                                                              F I L E D
                                                                       United States Court of Appeals
                                                                               Tenth Circuit

                                                                                JAN 7 1998
                        UNITED STATES COURT OF APPEALS

                                    TENTH CIRCUIT                         PATRICK FISHER
                                                                                    Clerk


 DAISY ALMEGARD, personal
 representative of the estate of Benna J.
 Almegard, deceased,

          Plaintiff-Appellant,

 v.                                                           No. 96-2279
                                                      (D.C. No. CIV-94-677-JP)
 SAN JUAN PILOT TRAINING, INC.,                        (District of New Mexico)
 doing business as Mesa Pilot
 Development; and MESA AIRLINES,
 INC., a corporation,

          Defendants-Appellees.




                                 ORDER AND JUDGMENT*


Before PORFILIO, LUCERO, and MURPHY, Circuit Judges.




      Benna Almegard died when a small aircraft in which he was a passenger crashed

into Mt. Wilson in Colorado. His wife, Daisy Almegard, as personal representative of her



      *
        This order and judgment is not binding precedent, except under the doctrines of
law of the case, res judicata, and collateral estoppel. This court generally disfavors the
citation of orders and judgments; nevertheless, an order and judgment may be cited under
the terms and conditions of 10th Cir. R. 36.3.
husband’s estate, brought this wrongful death action against Mesa Airlines, Almegard’s

one time employer, and San Juan Pilot Training, Inc., the owner of the crash aircraft. The

district court granted Mesa’s motion for summary judgment, concluding workers’

compensation provided Mrs. Almegard’s exclusive remedy. Plaintiff asserts error

claiming: (1) Mesa was not Almegard’s employer for purposes of workers’ compensation;

or, alternatively, (2) Mesa’s conduct rose to the level of an intentional tort. Under either

theory, plaintiff maintains, workers’ compensation would not bar an action in tort.

However, because Mrs. Almegard failed to create a genuine issue of material fact

concerning the identity of Almegard’s employer, and, because she cannot demonstrate the

requisite level of culpability on the part of Mesa, we affirm the grant of summary

judgment for Mesa.

       In addition, the court granted San Juan’s motion for summary judgment against

Mrs. Almegard on her negligent entrustment claims. Because plaintiff has failed to raise

a genuine issue of fact regarding San Juan’s negligence, we affirm.

       Mesa originally hired Benna Almegard as a pilot for its flight operations

headquartered in Farmington, New Mexico. When Mesa began operating Florida Gulf

Airlines, Inc., as a wholly owned subsidiary, Almegard moved to Florida and began flying

for Florida Gulf. The following year, Mesa and Florida Gulf merged, leaving Mesa as the

surviving corporation. Subsequently, Almegard was temporarily reassigned to Mesa’s

Farmington operation to begin training as a check airman. A check airman’s duties


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include flying from Mesa’s headquarters to various locations throughout the country to

assess the performance capabilities of other pilots.

       One April night, Tad Feazell, another Mesa check airman, and Almegard

“borrowed” one of defendant San Juan’s aircraft and flew from Farmington to Grand

Junction, Colorado.1 That night, while in Grand Junction, Almegard flew two check

flights with Mesa pilots. After flying the check flights, Almegard and Feazell departed

Grand Junction to return to Farmington. At 4:00 A.M., shortly after takeoff, the plane,

with Feazell at the controls, crashed into Mt. Wilson near Telluride, Colorado. Both men

were killed. The cause of the crash is unknown.

       Almegard’s wife applied for and received workers’ compensation benefits in

Florida where she resided. Subsequently, Mrs. Almegard brought this wrongful death

action against defendants Mesa and San Juan.2

                              A. Mesa Summary Judgment

       Prior to trial, Mesa filed a motion for summary judgment asserting Mrs.

Almegard’s exclusive remedy was workers’ compensation. In response, plaintiff argued

workers’ compensation did not bar her action against Mesa because: (1) Florida Gulf, not

       1
        Defendant San Juan Pilot Training, Inc., is a wholly owned subsidiary of Mesa
and provides flight training to pilots who seek employment with Mesa. Under an
“informal agreement” with San Juan, Mesa’s check airmen would occasionally pilot San
Juan’s aircraft to check sights instead of flying on a commercial carrier.
       2
         Feazell’s survivors also brought a wrongful death action against San Juan, and the
district court consolidated the cases. However, Feazell and San Juan settled their action
prior to oral argument.

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Mesa, was Almegard’s actual employer; or, alternatively, (2) Mesa committed an

intentional tort. The district court granted Mesa summary judgment, rejecting both of

plaintiff’s arguments.

       We review the grant of summary judgment de novo, applying the same legal

standards as the district court under Fed. R. Civ. P. 56. Aramburu v. The Boeing Co.,

112 F.3d 1398, 1402 (10th Cir. 1997). Summary judgment is appropriate if “there is no

genuine issue as to any material fact and ... the moving party is entitled to a judgment as a

matter of law.” Fed. R. Civ. P. 56(c). A genuine issue is one in which “the evidence is

such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

                                     1. Intentional Tort

       Under Florida law, “employers are provided with immunity from suit by their

employees so long as the employer has not engaged in any intentional act designed to

result in or that is substantially certain to result in injury or death to the employee.” Eller

v. Shova, 630 So. 2d 537, 539 (Fla. 1993).3 This “substantial certainty test” requires

“more than a strong probability of injury. It requires virtual certainty.” State v. V.E.

Whitehurst & Sons, Inc., 636 So. 2d 101, 105 (Fla. Dist. Ct. App. 1994) (emphasis




       3
        The district court determined Florida law governs this issue, a conclusion neither
party challenges.

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added). Under this standard, plaintiff must demonstrate Mesa engaged in an intentional

act that was virtually certain to result in Almegard’s death.

         In support of her claim, Mrs. Almegard argues Mesa overworked its pilots,

particularly Feazell, to the extent his fatigue would lead to the death of Almegard. In

fact, the district court found substantial evidence Feazell and Almegard had suffered from

excessive fatigue in the months prior to the crash. However, this evidence is insufficient

to create an issue of fact for two reasons.

         First, as the district court concluded, the record reveals no evidence Feazell, the

pilot of the aircraft, was fatigued on the night of the crash. On the contrary, the only

evidence presented, the testimony of two pilots who saw Almegard and Feazell prior to

their fatal flight, indicates Feazell and Almegard did not seem tired. One of these pilots

even asked to accompany the men on their trip. As the district court noted, “[t]his is

inconsistent with plaintiffs’ theory that John Feazell was noticeably fatigued on April 28

or 29, as a pilot would not entrust himself to a fellow pilot who he believed to be a flight

risk.”

         More importantly, even if plaintiff had presented competent evidence Feazell was

fatigued on the night of the accident and Mesa caused his condition, we do not believe

this rises to the necessary level of intentional conduct under Florida law. We find

Connelly v. Arrow Air, Inc., 568 So. 2d 448 (Fla. Dist. Ct. App. 1990), upon which

plaintiff primarily relies, particularly instructive. In Connelly, an overloaded airplane


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crashed killing the crew and all 248 United States servicemen aboard. In a suit filed by

the widow of an airline co-pilot, the trial court entered summary judgment for the airline

based on workers’ compensation exclusivity. In reversing, the appellate court found

evidence indicating the airline “intentionally misstated its capacity to carry the

mandatory maximum weight,” “deliberately used an average of passenger weights in

order to conceal the actual flight load,” and “purposefully” failed to notify the crew of a

mechanical problem. Id. at 449-50 (emphasis added). The evidence also revealed each

of these affirmative acts proximately contributed to the ultimate accident.

       Applying Florida law as reflected in Connelly and assuming admission of all

plaintiff’s evidence, we do not believe plaintiff has created a genuine issue of material

fact demonstrating Mesa acted with the requisite culpability. Here, unlike Connelly,

plaintiff has not presented any evidence Mesa took any affirmative actions to place

Almegard’s life in danger. Compare id. at 450. Moreover, plaintiff presented no

evidence Mesa deliberately, wilfully, or purposefully withheld information from Feazell

or Almegard. See, e.g., GMAC v. David, 632 So. 2d 123, 126 (Fla. Dist. Ct. App. 1994)

(“[Connelly] involved conduct in which the employer deliberately or maliciously

withheld information of a known defect or hazard which posed a great threat of injury or

death, thereby eliminating the chance for the employee to exercise an informed judgment

whether to perform the assigned tasks.”); Emergency One, Inc. v. Keffer, 652 So. 2d

1233, 1235 (Fla. Dist. Ct. App. 1995) (“It is particularly significant that [the evidence in


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Connelly evinced a] strong indication to deceive or cover up the danger involved, so that

the employees had no way to apprise themselves of the dangers involved and thereby

make a reasoned judgment as to their course of action.”). Feazell and Almegard knew

their condition better than any other person could have; yet, they still chose to fly. On this

record, we cannot find Mesa’s conduct rose to the level of intentional conduct required

under Florida’s standard.

       Mrs. Almegard’s remaining arguments suffer from a similar absence of evidence

demonstrating sufficiently culpable conduct. For instance, plaintiff argues Mesa’s

conduct was virtually certain to cause the death of Almegard when it allowed Feazell and

Almegard to fly over 10,000 feet without oxygen. Yet, the record reveals a portable

oxygen system was available in Grand Junction for the pilots’ use and neither of these

experienced pilots chose to carry the oxygen. Mesa did not “deliberately withhold” the

oxygen.

       Finally, Mrs. Almegard argues Mesa forced its pilots to violate rules and fly unfit

airplanes. However, all of plaintiff’s supporting evidence focused on mechanical

difficulties with Mesa’s airplanes and allegations that Mesa’s mechanics were pressured

to sign-off on unfit aircraft. It is undisputed the plane in which Almegard flew was not

mechanically defective in any manner. Accordingly, any evidence of shoddy maintenance

operations is irrelevant to our present inquiry. Compare Connelly, 568 So. 2d at 450




                                             -7-
(“There was substantial and competent evidence in the record that defective conditions in

the aircraft, ... all known to the employer, were contributing factors in the crash.”).

                                 2. Almegard’s Employer

       Plaintiff contends Florida Gulf and Mesa were separate entities; therefore, Florida

Gulf was Almegard’s employer for workers’ compensation purposes. Under this theory,

payment of workers’ compensation benefits by one entity, Florida Gulf, should not bar an

action in tort against a separate entity, Mesa. In support of this argument, plaintiff cites

two cases holding an employee of a wholly owned subsidiary who has obtained workers’

compensation benefits from the subsidiary may still bring an action in tort against the

parent corporation. See Gulfstream Land & Dev. Corp. v. Wilkerson, 420 So. 2d 587

(Fla. 1982); Gigax v. Ralston Purina Co., 136 Cal. App. 3d 591 (1982).

       Here, however, the district court found Mesa and Florida Gulf were “a single

entity for purposes of the exclusive remedy analysis.” The record provides ample support

for this conclusion. It is undisputed Mesa originally formed and operated Florida Gulf as

a wholly owned subsidiary. It is also undisputed that, prior to the crash, Mesa and Florida

Gulf merged leaving Mesa as the surviving corporation. The merger agreement between

Mesa and Florida Gulf provides “the separate existence of Florida Gulf shall cease” upon

the effective date of the merger. In addition, the agreement provides for the cancellation

of all issued and outstanding shares of Florida Gulf stock. This clearly distinguishes the

present case from Gigax and Gulfstream where two corporate entities were involved,


                                             -8-
each with the attendant status as a separate legal entity. Here, Florida Gulf was no longer

a corporation. While it may be a question of fact whether two corporations are separately

controlled thus creating two potential defendants, in this case, there is only one

corporation and, we conclude, only one employer -- Mesa.

                            B. San Juan Summary Judgment

       In addition to her claims against Mesa, Mrs. Almegard also brought suit against

San Juan, the owner of the crash aircraft, alleging it had negligently entrusted the plane to

Feazell. Concluding Mrs. Almegard had failed to create an issue of fact whether San

Juan knew or should have known of the alleged dangers of the fatal flight, the district

court granted San Juan’s summary judgment.

       Mrs. Almegard bases her claim on various sections of the Restatement (Second) of

Torts which hold lessors and suppliers of chattels liable for negligently failing to make

the chattel safe or disclose the chattel’s dangerous condition. See, e.g., Restatement

(Second) of Torts §§ 390, 408 (1965). She argues San Juan knew or should have known

the aircraft in question was defective and failed to make the aircraft safe. Alternatively,

Mrs. Almegard maintains San Juan knew or should have known Feazell was unfit to fly

the airplane. We will address these contentions in turn.

       According to plaintiff, the aircraft in question was defective because it was not

pressurized and it did not have a portable or permanent oxygen system on board.

However, this aircraft can be safely operated at a wide range of altitudes. Here, the


                                            -9-
record reveals Feazell could have chosen to fly on a route where oxygen was not required.

In fact, the accident occurred at an altitude at which the FAA does not even require the

use of oxygen. See, e.g., 14 C.F.R. § 91.211 (1997). With the record before us, we

cannot conclude the airplane was defective merely because it lacked an oxygen system.

       Plaintiff also maintains San Juan knew or should have known Feazell was unfit to

pilot the plane because Feazell regularly failed to follow procedures and was fatigued.

The record reveals pilot Feazell made numerous errors prior to the fatal flight. He did not

file a flight plan, failed to initiate flight following, and did not monitor the airplane’s

altitude relative to the surrounding terrain. While this may demonstrate negligence on

Feazell’s part, we can find no evidence in the record San Juan knew or should have

known Feazell would have made these errors. At most, the record demonstrates San Juan

knew Feazell had a habit of “borrowing” aircraft without signing the aircraft out; thus,

San Juan could not appropriately track airplane hours for billing purposes. Such evidence

is not probative of the issues in this case.

                                   C. Evidentiary Rulings

       Finally, Mrs. Almegard asserts the district court erred when it struck numerous

affidavits and exhibits from her opposition to the Mesa summary judgment. Because we




                                               - 10 -
believe the district court correctly entered Mesa’s summary judgment even assuming all

of the evidence was not stricken, we need not assess the admissibility of this evidence.

       AFFIRMED.

                                          ENTERED FOR THE COURT

                                          John C. Porfilio
                                          Circuit Judge




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