Federal Insurance Company wants more than $350,000 back from CET Color, Inc. after a fire at a Minnesota plant, blaming a faulty UV printer for the loss.
On Sept. 4, Federal Insurance Company filed a lawsuit in the U.S. District Court for the District of Minnesota, aiming to recover a payout it made to Trystar, LLC f/k/a Trystar, Inc., a manufacturer of temporary power distribution systems. The story starts in Faribault, Minnesota, where Trystar’s facility at 15765 Acorn Trail suffered a fire on February 9, 2024. The fire, according to the complaint, broke out while the plant was closed, and an investigation revealed the blaze originated at or near the control panel of a CET Color model Q5-1000 UV flatbed printer, referred to as “CET 1.”
Federal Insurance, which had insured Trystar’s property, says it reimbursed Trystar for claims in an amount in excess of $350,000. Now, the insurer wants CET Color, Inc., the Georgia-based company that made and sold the printer, to pay up. The complaint claims CET 1 was unreasonably defective, hazardous, and susceptible to causing fires because of an internal defect and the absence of appropriate safeguards such as fuses. It also alleges the printer was defective when it left CET Color, Inc.’s care and control.
The insurance company’s argument is straightforward: CET Color, Inc. didn’t do enough to ensure the printer was safe before it reached Trystar. Federal Insurance lists several alleged failures, including design, manufacturing, testing, inspection, and warning users about dangers. The insurer also claims the printer was not fit for its ordinary purpose – printing directly onto metal as part of Trystar’s process - and that CET Color, Inc. should have known about the risks.
Federal Insurance isn’t just relying on claims of negligence. The complaint also alleges strict product liability and breaches of implied warranties of merchantability and fitness for a particular purpose under Minnesota law. In short, the insurer claims CET 1 was supposed to be safe and reliable, but it wasn’t – and that CET Color, Inc. should be held responsible for the resulting damages.
The complaint does not specify particular insurance policy clauses but states that Federal Insurance had in full force and effect a policy of insurance issued to Trystar, which provided coverage for its property at the facility. After paying the claim, Federal Insurance is now subrogated to Trystar’s claims against CET Color, Inc., seeking to recover what it paid out.
For insurance professionals, this case underscores the risks associated with insuring commercial property and the potential for product failures to lead to significant claims. It also highlights the insurer’s role in seeking recovery from third parties when a loss occurs, especially when equipment defects are alleged.
At this stage, these are only allegations – CET Color, Inc. has not yet responded in court, and no findings have been made. The case is set for a jury trial, and its progress will be of interest to those in the business of insuring manufacturing operations and commercial equipment.
