Canal Electric Co. v. Westinghouse Electric Co.

BREYER, Chief Judge.

The consolidated appeals in this diversity case arise out of the discovery, between 1983 and 1985, of tiny cracks (called “fretting”) in the turbine blades of a Canal Electric Company generator. Canal Electric Company sued the firm that had promised to service the generator, Westinghouse Electric Corporation, claiming that Westinghouse had breached both the generator’s service and equipment warranties. Several Canal customers (the third-party plaintiffs) also sued Westinghouse, claiming that the cracks harmed them, by disrupting Canal’s operations, and thereby bringing…