Lincoln General Insurance Company v. Detroit Diesel Corporation

Senators Rental, Inc. bought a bus manufactured by Prevost Car (US) Inc. (defendant), containing an engine made by Detroit Diesel Corporation (defendant); the bus caught fire allegedly due to an engine defect, damaging only the bus itself. Senators' insurer, Lincoln General Insurance Company (plaintiff), sued Prevost and Detroit Diesel for breach of warranty, negligence, and strict products liability; Prevost moved to dismiss the tort claims based on the economic loss doctrine, and Lincoln General argued it should be able to recover for damage resulting from a sudden, calamitous event. The federal district court certified to the Tennessee Supreme Court whether the state recognizes an exception to the economic loss doctrine for such sudden calamitous damage to the defective product itself.