The Pennsylvania Superior Court ruled a parent-company was not responsible for its subsidiary’s actions.

In Barnes v. Alcoa, Inc., Kawneer Company Inc. was a wholly owned subsidiary of Alcoa Inc. Kawneer hired G&M Crawford Inc. to remove snow and ice from Kawneer’s parking lot.  A Kawneer employee, David Barnes, slipped and fell on ice while walking through the Kawneer parking lot, and sued Alcoa (among others) based on a theory of negligent hiring and negligent supervision.  In response, Alcoa filed a motion to dismiss. In opposition, Barnes attempted to argue that the Kawneer employees who were responsible for the hiring and supervision of G&M were actually Alcoa employees.  In assessing the validity of this argument, the court noted that the relevant employees had testified that they were employees of Kawneer (not Alcoa) and that Barnes had produced no evidence that Alcoa exercised direction or control over the employees’ actions.  Conversely, the only evidence that had been produced by Barnes were paychecks that were issued from Alcoa to the employees, which the court deemed insufficient.  Barnes also attempted to argue that the G&M snow and ice contract, at issue, was actually a contract between G&M and Alcoa.

The court disagreed.  Specifically, the court reasoned since the contract expressly stated that it was between G&M and Kawneer, the contract could not be found to be between G&M and Alcoa.  Finally, Barnes attempted to argue that Alcoa exercised control over the parking lot.  The court again disagreed. Although the court noted that Alcoa did send safety inspectors to the Kawneer facility, there was no evidence that the inspectors conducted any inspections / provided any services in connection with the parking lot.  Consequently, the court concluded that Barnes could not sustain a claim for negligent hiring or negligent supervision against the Alcoa, the parent-company of the owner of the parking lot in which Barnes fell.

This case reveals that Pennsylvania courts will likely analyze a parent company’s liability for the actions of its subsidiary on a case-by-case and fact-by-fact basis.

Thanks to Colleen Hayes for her contribution to this post.