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PARENT CORPORATION NOT LIABLE, UNDER A STRICT PRODUCTS LIABILITY THEORY, FOR ASBESTOS-CONTAINING PRODUCTS MANUFACTURED AND DISTRIBUTED BY A WHOLLY OWNED SUBSIDIARY.

The Court of Appeals, in a full-fledged opinion by Judge Pigott, reversing the Appellate Division, determined the products liability complaint against Ford USA, based upon asbestos brake linings manufactured and distributed by Ford UK, should have been dismissed. The Court of Appeals concluded Ford USA could only be held liable for a product manufactured and distributed by a wholly owned subsidiary by piercing the corporate veil, a theory unsupported by the facts alleged:

Ford USA was not a party within the distribution chain, nor can it be said that it actually placed the parts into the stream of commerce. Although plaintiff submitted evidence tending to show that Ford USA provided guidance to Ford UK in the design of certain tractor components, absent any evidence that Ford USA was in fact a manufacturer or seller of those components, Ford USA may not be held liable under a strict products liability theory … . * * *

Ford USA, as the parent corporation of Ford UK, may not be held derivatively liable to plaintiff under a theory of strict products liability unless Ford USA disregarded the separate identity of Ford UK and involved itself directly in that entity's affairs such that the corporate veil could be pieced … a conclusion that neither Supreme Court nor the Appellate Division reached in this instance. Finerty v Abex Corp., 2016 NY Slip Op 03411, CtApp 5-3-16

PRODUCTS LIABILITY (PARENT CORPORATION NOT LIABLE, UNDER A STRICT PRODUCTS LIABILITY THEORY, FOR ASBESTOS-CONTAINING PRODUCTS MANUFACTURED AND DISTRIBUTED BY A WHOLLY OWNED SUBSIDIARY)/CORPORATION LAW (PRODUCTS LIABILITY, PARENT CORPORATION NOT LIABLE, UNDER A STRICT PRODUCTS LIABILITY THEORY, FOR ASBESTOS-CONTAINING PRODUCTS MANUFACTURED AND DISTRIBUTED BY A WHOLLY OWNED SUBSIDIARY)/PIERCING THE CORPORATE VEIL (PRODUCTS LIABILITY, PARENT CORPORATION NOT LIABLE, UNDER A STRICT PRODUCTS LIABILITY THEORY, FOR ASBESTOS-CONTAINING PRODUCTS MANUFACTURED AND DISTRIBUTED BY A WHOLLY OWNED SUBSIDIARY)

EXPERT AFFIDAVIT RAISED QUESTION OF FACT WHETHER NAIL GUN WAS DEFECTIVELY DESIGNED.

The Fourth Department determined plaintiffs raised a question of fact whether a nail gun was defectively designed based upon an affidavit from an expert engineer. The nail gun could be operated in a “bump” mode where the nail is released when the tip of the gun comes into contact with a surface. And the nail gun could be operated by squeezing a trigger. Here the nail gun was in “bump” mode when it came into contact with plaintiff's head and a three-inch nail went into plaintiff's brain:

Plaintiffs' expert opined to a reasonable degree of engineering certainty that the nail gun is defective “because it did not have[,] as a sole means of actuation, a full sequential trip trigger” and instead also provided for the option for a “contact trip” or a bump trigger. The expert explained that the center of gravity of the nail gun causes the operator to maintain a finger on the trigger when lowering the nine-pound gun, as was the case here; that the sequence of the use of the trigger to determine the mode of operation causes operator confusion as to which mode of operation is in use, which he opined happened here based upon the testimony of the employee that he thought the nail gun was in sequential fire mode; that government safety studies he reviewed found a much higher rate of injury when the nail gun was in the bump mode; and that tests he performed and studies he reviewed established that the utility of the bump mode does not outweigh the danger of its use because it is “only 10% faster” than the sequential fire mode … . ” Where, as here, a qualified expert opines that a particular product is defective or dangerous, describes why it is dangerous, explains how it can be made safer, and concludes that it is feasible to do so, it is usually for the jury to make the required risk-utility analysis' ” … . Terwilliger v Max Co., Ltd., 2016 NY Slip Op 02226, 4th Dept 3-25-16

PRODUCTS LIABILITY (EXPERT AFFIDAVIT RAISED QUESTION OF FACT WHETHER NAIL GUN WAS DEFECTIVELY DESIGNED)/DEFECTIVE DESIGN (PRODUCTS LIABILITY, EXPERT AFFIDAVIT RAISED QUESTION OF FACT WHETHER NAIL GUN WAS DEFECTIVELY DESIGNED)

QUESTIONS OF FACT WHETHER AUTOMOBILE LIFT WAS INTENDED TO BE USED WITHOUT A PROTECTIVE DEVICE AND WHETHER WARNINGS WERE ADEQUATE.

The Second Department determined plaintiff had raised questions of fact whether the automobile lift was defectively designed and whether there were inadequate warnings about its use. When the lift was originally shipped, there was a plastic cover over an opening which exposed the mechanism. The plastic cover was inexplicably missing. Two of plaintiff's fingers were partially amputated when plaintiff put his hand inside the hole. Although the manufacturer demonstrated the product was safe with the cover in place, plaintiff raised questions of fact in opposition, including a question whether the lift was intended to be used without the cover:

Manufacturers may be held strictly liable for injuries caused by their products “because of a mistake in the manufacturing process, because of defective design or because of inadequate warnings regarding use of the product” … . Furthermore, “[a] manufacturer has a duty to warn against latent dangers resulting from foreseeable uses of its product[s] of which it knew or should have known” … .

Here, the manufacturer made a prima facie showing of entitlement to judgment as a matter of law dismissing so much of the complaint as alleged products liability based upon a design defect. The manufacturer demonstrated that the lift was shipped with a plastic cover over the hole in the lift but the cover had been removed by the time of the accident … . The manufacturer further demonstrated, prima facie, that, if the cover were in place, it would have prevented the plaintiff from placing his hand or other body parts inside the lift while the lift was in operation … . However, in opposition, the plaintiff raised triable issues of fact as to whether the lift was defective at the time it was manufactured and sold, or whether a post-sale modification of the product rendered the otherwise safe product defective, and the modification was the proximate cause of the plaintiff's injuries … . Among other things, the plaintiff raised a triable issue as to whether the lift was intended to be used without the plastic cover in place … .

With respect to the plaintiff's inadequate warning claim, the manufacturer failed to establish, prima facie, that it had adequately warned users of the hazards posed by operating the lift without the cover in place or, more broadly, the dangers of placing a hand or other body part in the hole while operating the lift … . Singh v Gemini Auto Lifts, Inc., 2016 NY Slip Op 01826, 2nd Dept 3-16-16

 

PRODUCTS LIABILITY (QUESTIONS OF FACT WHETHER AUTOMOBILE LIFT WAS INTENDED TO BE USED WITHOUT A PROTECTIVE DEVICE AND WHETHER WARNINGS WERE ADEQUATE)

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EXPERT EVIDENCE OF A RECALL AND EVIDENCE OF CUSTOMER COMPLAINTS ABOUT DEFENDANTS’ MOTORCYCLE RELEVANT TO DEFENDANTS’ DUTY TO WARN.

The Fourth Department, eliminating restrictions on the evidence imposed by Supreme Court, determined evidence from plaintiffs’ electrical expert and evidence of customer complaints were relevant to defendants’ duty to warn. Plaintiffs alleged an electrical defect in their motorcycle (manufactured by defendants) caused the accident. Plaintiffs sought to introduce evidence of a recall made prior to the accident and evidence of customer complaints:

… [W]e conclude that the court erred in granting that part of defendants’ motion seeking to preclude the testimony of plaintiffs’ electrical engineer expert and the customer complaints to the extent that such evidence is relevant to defendants’ continuing duty to warn. We therefore modify the order accordingly. “A manufacturer or retailer may . . . incur liability for failing to warn concerning dangers in the use of a product which come to his attention after manufacture or sale . . . through being made aware of later accidents involving dangers in the product of which warning should be given to users . . . Although a product [may] be reasonably safe when manufactured and sold and involve no then known risks of which warning need be given, risks thereafter revealed by user operation and brought to the attention of the manufacturer or vendor may impose upon one or both a duty to warn” … . “What notice . . . will trigger [this] postdelivery duty to warn appears to be a function of the degree of danger which the problem involves and the number of instances reported . . . [Whether] a prima facie case on that issue has been made will, of course, depend on the facts of each case” … .

Defendant’s recall was first issued in March 2004, prior to plaintiffs’ accident on April 30, 2004. A determination that plaintiffs’ motorcycle should have been included in the recall would be relevant to defendants’ duty to warn plaintiffs of the defect that, plaintiffs allege, caused a “quit while riding” event in their motorcycle and thereby caused or contributed to their accident. Plaintiffs’ expert, an electrical engineer, expects to testify in part that plaintiffs’ motorcycle does not differ in any material respect from those included in the 2004 recall, despite the fact that plaintiffs’ motorcycle did not have the same stator as the motorcycles affected by the recall. In our view, the expert’s qualifications as an electrical engineer qualify him to opine whether the motorcycles “were the same in all significant respects” … , and the fact that the expert has done no testing goes to the weight to be given to his testimony, not its admissibility … . Smalley v Harley-Davidson Motor Co. Group LLC, 2015 NY Slip Op 09712, 4th Dept 12-31-15

NEGLIGENCE (PRODUCTS LIABILITY, EVIDENDE OF RECALL AND CUSTOMER COMPLAINTS RE: DEFENDANT’S MOTORCYCLE RELEVANT TO DEFENDANTS’ DUTY TO WARN)/PRODUCTS LIABILITY (EVIDENCE OF RECALL AND CUSTOMER COMPLAINTS RE: DEFENDANT’S MOTORCYCLE RELEVANT TO DEFENDANTS’ DUTY TO WARN)/DUTY TO WARN (PRODUCTS LIABILITY, EVIDENCE OF RECALL AND CUSTOMER COMPLAINTS RE: DEFENDANT’S MOTORCYCLE RELEVANT TO DEFENDANTS’ DUTY TO WARN)

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MANUFACTURER OF A TUBE SLIDE AND THE PROPERTY OWNER WHERE THE TUBE SLIDE WAS LOCATED ENTITLED TO SUMMARY JUDGMENT; INFANT PLAINTIFF FELL WHEN CLIMBING ON THE OUTSIDE OF THE TUBE SLIDE.

The Second Department determined both the manufacturer (Slip N Slide) of a tube slide (an enclosed plastic spiral tube) and the property owner (Philip Howard) where the tube slide was located were entitled to summary judgment. Infant plaintiff (ten years old) was injured when she fell while climbing on the outside of the tube slide. The Second Department determined the dangers of climbing on the outside of the tube were obvious and the tube slide was not inherently dangerous or defectively designed. In addition, the property owner demonstrated it did not create the hazardous condition or have constructive notice of it:

Contrary to the plaintiffs’ contention, Swing N Slide established its prima facie entitlement to judgment as a matter of law by demonstrating that the tube slide was not inherently dangerous or otherwise defectively designed … . In addition, as here, “there is no liability for failure to warn where [the] risks and dangers are so obvious that they can ordinarily be appreciated by any consumer to the same extent that a formal warning would provide . . . or where they can be recognized simply as a matter of common sense” … . In opposition, the plaintiffs failed to raise a triable issue of fact. Accordingly, the Supreme Court properly granted that branch of Swing N Slide’s motion which was for summary judgment dismissing the complaint insofar as asserted against … .

Philip Howard also was entitled to judgment as a matter of law. “A landowner has a duty to exercise reasonable care to maintain its premises in a reasonably safe condition in view of all the circumstances, including the likelihood of injury to others, the seriousness of the injury, and the burden of avoiding the risk'” … . “A defendant in a premises liability case may establish its prima facie entitlement to judgment as a matter of law, inter alia, by establishing that it neither created the hazardous condition nor had actual or constructive notice of its existence for a sufficient time to remedy it, or that the accident was not foreseeable” … .

Here, Philip Howard demonstrated its prima facie entitlement to judgment as a matter of law by submitting proof that the tube slide, which was neither inherently dangerous nor defectively designed, was installed and maintained in a reasonably safe condition. Moreover, there is no duty imposed upon a landlord to supervise children who are properly upon its premises … . Moseley v Philip Howard Apts. Tenants Corp., 2015 NY Slip Op 09080, 2nd Dept 12-9-15

NEGLIGENCE (PLAINTIFF FELL WHILE CLIMBING ON OUTSIDE OF TUBE SLIDE)/PRODUCTS LIABILITY (PLAINTIFF FELL WHILE CLIMBING ON THE OUTSIDE OF A TUBE SLIDE)

Where Plaintiff Does Not Know Which of Two Defendants Distributed the Product Which Caused the Injury, the Doctrine of Alternative Liability Applies—Doctrine Explained

The Second Department determined the doctrine of alternative liability applied to a strict products liability case where it was not possible for the plaintiff to determine which of two defendants distributed the product. The doctrine places the burden on the defendants to demonstrate which of them distributed the product, and if that is not possible, the two defendants would be jointly and severally liable:

Generally, a plaintiff seeking to recover for injuries sustained due to the use of a product is required to prove that it was the defendant who placed the product that injured him or her into the stream of commerce … . However, the doctrine of alternative liability is “available in some personal injury cases to permit recovery where the precise identification of a wrongdoer is impossible” … .

Under that doctrine, where the conduct of two or more defendants is tortious, and ” it is proved that harm has been caused to the plaintiff by only one of them, but there is uncertainty as to which one,'” the burden is placed on those defendants to prove that they did not cause the harm … . If the defendants cannot meet that burden, they are jointly and severally liable … . “Recovery under an alternative liability theory requires joinder of all the parties who could have been responsible for a plaintiff’s injuries” … . Silver v Sportsstuff, Inc., 2015 NY Slip Op 06232, 2nd Dept 7-22-15

 

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Striking Answer for Spoliation of Evidence Too Severe a Sanction—Spoliation Was Not “Willful or Contumacious,” Both Parties Were Prejudiced by the Loss, Plaintiff Was Not Deprived of Means of Proving the Claim

The Second Department determined striking the defendant’s answer was too severe a sanction for spoliation of evidence which was not “willful or contumacious.”  Plaintiff was injured attempting to use a tranquilizer gun. The gun was sent out for repairs after the incident and a portion of the gun was not found after a diligent search.  The sanction was too severe because both parties were prejudiced by the loss and the loss did not deprive plaintiff of the means of proving his claim:

Under the common-law doctrine of spoliation, a party may be sanctioned where it negligently loses or intentionally destroys key evidence (see CPLR 3126…). “The nature and severity of the sanction depends upon a number of factors, including, but not limited to, the knowledge and intent of the spoliator, the existence of proof of an explanation for the loss of the evidence, and the degree of prejudice to the opposing party” … .

“The party requesting sanctions for spoilation has the burden of demonstrating that a litigant intentionally or negligently disposed of critical evidence, and fatally compromised its ability to'” prove its claim or defense … . However, ” striking a pleading is a drastic sanction to impose in the absence of willful or contumacious conduct'” and, thus, the courts must ” consider the prejudice that resulted from the spoliation to determine whether such drastic relief is necessary as a matter of fundamental fairness'” … . When the moving party is still able to establish or defend a case, a less severe sanction is appropriate …. Furthermore, where the plaintiffs and the defendants are equally affected by the loss of the evidence in their investigation of the accident, and neither have reaped an unfair advantage in the litigation, it is improper to dismiss or strike a pleading on the basis of spoliation of evidence … .

The determination of the appropriate sanction for spoliation is within the broad discretion of the court … . This Court will substitute its judgment for that of the Supreme Court only if that court’s discretion was improvidently exercised … .

Here, the Supreme Court, upon renewal and reargument, improvidently exercised its discretion in imposing the sanction of striking the City defendants’ answer, as the plaintiff failed to establish that the City defendants’ failure to preserve the subject tranquilizer gun was willful or contumacious … , or that their conduct deprived him of the means of proving his claim … . The City defendants’ repair of the subject gun prejudiced all parties, but does not prevent the plaintiff from proving his claim … . Morales v City of New York, 2015 NY Slip Op 06121, 2nd Dept 7-15-15

 

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Absence of a Safety Device Which Would Reduce the Functionality of a Table Saw is Not a Design Defect–Criteria Explained

The Second Department determined summary judgment should have been granted as a matter of law to the manufacturer of a table saw. Plaintiff alleged the absence of an interlock device which would not allow the saw to operate without a protective guard in place was a design defect.  However, it is settled that such an interlock device on a table saw renders the saw unusable for some cuts and, therefore, the absence of the device is not a design defect:

The definition of a design defect, for purposes of imposing products liability, is that “if the design defect were known at the time of manufacture, a reasonable person would conclude that the utility of the product did not outweigh the risk inherent in marketing a product designed in that manner” … . “This standard demands an inquiry into such factors as (1) the product’s utility to the public as a whole, (2) its utility to the individual user, (3) the likelihood that the product will cause injury, (4) the availability of a safer design, (5) the possibility of designing and manufacturing the product so that it is safer but remains functional and reasonably priced, (6) the degree of awareness of the product’s potential danger that can reasonablely be attributed to the injured user, and (7) the manufacturer’s ability to spread the cost of any safety-related design changes” … . Liability attaches when an analysis of these factors leads one to conclude that “the utility of the product did not outweigh the risk inherent in marketing” it … .

An interlock on a table saw, which would prevent the operation of the table saw without the guard in place, could make the table saw unusable for certain cuts, thereby impairing its functionality … . Therefore, a theory of liability based upon an allegation that a table saw should have been designed with an interlock has been “explicitly rejected as a matter of law” … . Chavez v Delta Intl. Mach. Corp., 2015 NY Slip Op 05903, 2nd Dept 7-8-15

 

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Dismantling, Salvaging or Demolishing a Product Is Not a Foreseeable Use of the Product

The First Department determined the dismantling, salvaging and demolishing of valves containing asbestos did not constitute a foreseeable use of the valves.  The complaint against the manufacturer of the valves, sounding in strict products liability and negligence, was dismissed.

“A manufacturer who sells a product in a defective condition is liable for injury which results to another when the product is used for its intended purpose or for an unintended but reasonably foreseeable purpose” (Lugo v LJN Toys, 75 NY2d 850, 852 1990] [citations omitted]; see also New Holland at 53-54). The issue, which has not been squarely addressed by the courts of this State, is whether dismantling constitutes a reasonably foreseeable use of a product.  * * *

“To recover for injuries caused by a defective product, the defect must have been a substantial factor in causing the injury, and the product must have been used for the purpose and in the manner normally intended or in a manner reasonably foreseeable'” … . As plaintiff did not use [defendant’s] manufactured product in a reasonably foreseeable manner and his salvage work was not an intended use of the product, the complaint should have been dismissed. Hockler v William Powell Co., 2015 NY Slip Op 04765, 1st Dept 6-9-15

 

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Elements of a Defective Design Cause of Action Described

The Third Department determined questions of fact had been raised about whether a machine was defectively designed. Plaintiff was injured when he attempted to make adjustments while the machine was running.  There was evidence the adjustments could have been made safely using another access point. The court provided a good explanation of the elements of a defective-design cause of action:

Liability for a defectively designed product “attaches when the product, as designed, presents an unreasonable risk of harm to the user” … . A successful cause of action for defective design exists where a plaintiff is able to establish “that the manufacturer breached its duty to market safe products when it marketed a product designed so that it was not reasonably safe and that the defective design was a substantial factor in causing plaintiff’s injury” … . To demonstrate a product was not “reasonably safe,” the injured party must demonstrate both that there was a substantial likelihood of harm and that “it was feasible to design the product in a safer manner” .. . A claim may be defeated where a defendant demonstrates that the product’s “utility outweighs its risks [because] the product has been designed so that the risks are reduced to the greatest extent possible while retaining the product’s inherent usefulness at an acceptable cost” … . This “risk-utility analysis” requires consideration of “‘(1) the product’s utility to the public as a whole, (2) its utility to the individual user, (3) the likelihood that the product will cause injury, (4) the availability of a safer design, (5) the possibility of designing and manufacturing the product so that it is safer but remains functional and reasonably priced, (6) the degree of awareness of the product’s potential danger that can reasonably be attributed to the injured user, and (7) the manufacturer’s ability to spread the cost of any safety-related design changes'” … . Generally, the risk/utility analysis presents a factual question for a jury … . Barclay v Techno-Design, Inc., 2015 NY Slip Op 04708, 3rd Dept 6-4-15

 

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