Friday Links

As our regular readers know all too well, we here at Abnormal Use typically adorn our weekly Friday Links posts with legal themed comic books covers. Today, of course, shall be no exception, as we feature the covers of issues #2 and #3 of the NCSC Justice Case Files. However, we must confess that we, as well as our firm of Gallivan, White, & Boyd, P.A., played a role in distributing these comic books to schoolchildren across South Carolina to better acquaint them with the legal process. That’s right, dear readers! We’re now comic book distributors!

Well, kind of.

The comics themselves are actually the brainchild of the National Center for State Courts (NCSC), which sought to advance civics education by creating the three issues, all of which address legal topics in an attempt to educate the public. Our firm, along with another South Carolina firm, purchased more than 3,000 of the comics books to donate to South Carolina teachers. Apparently, they’re a hot property, as 65 schools requested them for their students.

So, now we here are now just bloggers, we’re in the comics industry! Who knows what will be next? Perhaps DC Comics will now ask us to write a few issues of Batman?

(Side note: Don’t you think the guy holding his hand to his heart on the cover of issue #3 – depicted below – looks a lot like Dwight Schrute?)

See here for our official press release on this project.

Soda: The New Carcinogen?

“Every absurdity has a champion to defend it.” – Oliver Goldsmith. Here’s another thought: Drinking a soda is just as detrimental to your health as smoking an entire pack of cigarettes. Now, we here at Abnormal Use don’t have any proof for that last statement, but we’re sure you’ll soon see the campaign about the evils of “caramel color.” According to the Center for Science in the Public Interest, the caramel coloring in popular colas contains carcinogens.

The culprit it seems, is 4-Methylimidazole, an innocent-sounding substance, don’t you think? Do not be fooled. The Executive Director of CSPI, Michael Jacobson, has taken to the Huffington Post, where all great news stories are faithfully told, to spread the word that cola contains cancer causing agents. California has added 4-Methylimidazole to its Proposition 65 list [PDF]. 4-Meth has caused various types of cancers in lab rats. CSPI has even gone so far to warn us of this danger by concocting a Toxi-Cola graphic, showing all of the terrible things in the product.

Let us first say that we do not trust the public interest. We look after our own interest, and, as rational people all look after their individual interests, order and efficiency are maintained. Second, while we do occasionally wear tin foil hats, we have to believe that, if cola really caused cancer, we as a society would have figured it out before now. Such is the opinion of the author of the appropriately named CSPIscam website. Ben Forer of ABC News filed this report quoting one Dr. Fred Guengerich, a biochemist, who appears to be a very smart dude:

“Is it a carcinogen? The tests have shown in mice it can increase the risk of cancer. On the other hand, there is also evidence in male rats, it prevented several kinds of cancer,” said Guengerich. “Basically my advice would be just to relax . . . I did some simple math. … If you look at the study in terms of what the mice got, in terms of causing any effect, a human being would have to drink more than 1,000 sodas a day.”

We don’t know of any associate that drinks 1,000 sodas a day, but this has all the makings of a nice lawsuit. A Plaintiff sues and claims that caffeine addicted him to cola and that he drank hundreds of colas per day, ingesting tons of carcinogens and high fructose corn syrup. Hey, that’s not his fault, purports his attorney. Someone should have told him that its perilous to drink hundreds of colas per day. How else was he to know, after all?

We think the best option is a class action settlement where the settlement includes a lifetime supply of cola. Perhaps this is an advertising gambit of Pepsi to bring back the long lost product Crystal Pepsi, which we know we have all spent the past 18 years pining for. Nevertheless, be on the lookout for junk science, and take pride in your caramel-colored beverage.

When is a Product Sold? We Now Have the Answer!

Many months ago, we here at Abnormal Use discussed the critical question, “When does a bucket truck become a bucket truck?” At that time, we were discussing Campbell v. Altec Indus., Inc., 605 F.3d 839 (11th Cir. 2010) [PDF], which involved a plaintiff allegedly injured when a cylinder on a bucket truck owned by Georgia Power failed. The plaintiff sued not only the manufacturer of the truck but that of the lift cylinder, as well. The problem for the plaintiff, however, was the statute of repose, which limited the action to “ten years from the date of the first sale or use or consumption of the personal property causing or otherwise bringing about the injury.” If that seems unclear to you, well, the Eleventh Circuit wasn’t so sure about what it all meant, either. So, they certified the following question to the Georgia Supreme Court: Does the ten-year statute of repose begin to run when:

(1) a component part causing an injury is assembled or tested, (2) a finished product, which includes an injuring component part, is assembled, or, (3) a finished product, which includes an injuring component part is delivered to its initial purchaser?

Well, we finally have our answer. The Georgia Supreme Court recently issued its decision in Campbell v. Altec Indus., Inc., —S.E.2d—, 2011 WL 356110 (Ga. Feb. 7, 2011) [PDF]. The Court held that the statute of repose began to run on the action when the truck was delivered as new to its intended consumer (choice number 3 in the excerpt above, in case you are keeping track).
In coming to its decision, the Court relied heavily on statutory interpretation of OCGA section 51-1-11(b)(1), which imposes liability on a manufacturer “of any personal property sold as new property directly or through a dealer or any other person” when a person is injured because the manufacturer’s product “when sold by the manufacturer was not merchantable and reasonably suited to the use intended, and its condition when sold is the proximate cause of the injury sustained.” The Court reasoned that:

In crafting OCGA § 51-1-11(b), the General Assembly did not choose to begin the period of repose “on the date of the ‘first sale’ of a product by its manufacturer. [Rather, OCGA § 51-1-11(b)(2) ] provides that the period of repose commences on the date of the ‘first sale for use or consumption.’ The General Assembly could have chosen to begin the period of repose on the date that the product was last in the hands of the manufacturer, but it did not. The choice of “the date of the first sale for use or consumption” to trigger the running of the statute of repose is in keeping with OCGA § 51-1-11(b)(1)’s imposition of liability on a manufacturer who sells its product “directly or through a dealer or any other person” as new; regardless of any chain of middlemen, the end sale of the product as new is what brings the manufacturer within the ambit of OCGA § 51-1-11(b)(1), if the other conditions for imposing liability exist.

In so holding, the Court specifically overruled the prior decision of Johnson v. Ford Motor Co., 281 Ga. App. 166, 637 S.E.2d 202 (2006), which the Court called “wrongly decided.” The Court of Appeals had held in that case that the statute of repose began to run when a defective switch, the cause of the plaintiff’s injuries in that case, was installed in the Ford automobile (choice number 2 from the certified question above). Instead, the Campbell Court adopted the reasoning of Pafford v. Biomet, 264 Ga. 540, 448 S.E.2d 347 (1994), which drew the distinction between the sale of a product to “the individual who initially purchased a manufactured product for mere static retention in his inventory” and the individual who purchases the product and intends to actually use it. It is only when the purchase is made to the user that the statute of repose begins to run, because, in the words of the Pafford Court “it is that individual who is the intended beneficiary of the liability imposed” through the statute.

This ruling means that a manufacturer of a defective component part will not be able to avoid liability to an injured plaintiff when the end-product simply sits on the retailer’s shelf for a long time before being sold to the user, effectively shortening the statute of repose. The decision does not undermine a plaintiff’s burden to prove that the product is actually defective, or that the allegedly defective product proximately caused his or her injuries; it simply closes the procedural loophole that Johnson created.

A Rose by Any Other Name: The Economic Loss Rule and the Independent Duty Doctrine

There has been a lot of buzz about the recent Washington Supreme Court decision in Eastwood v. Horse Harbor Foundation, Inc., 241 P.3d 1256 (Wash. 2010) concerning the economic loss rule. Or, rather, what used to be the economic loss rule in the State of Washington, and which has now been re-named and re-vamped as the independent duty doctrine.

As we all know, the economic loss rule bars recovery in tort for purely economic losses caused by a defective product. In other words, without injury to a person or to personal property, there can be no recovery for pecuniary loss. Several jurisdictions, of which Washington used to be one, subscribe to a more liberal interpretation, finding that the rule barred liability in tort cases between parties who had entered into a contract. The theory behind this expansive approach is that the parties could have built the risk of the loss into the contract. That was approach taken by the Washington Supreme Court previously in Alejandre v. Bull, 153 P.3d 864 (Wash. 2007).

Enter Eastwood, which involved the failure of a tenant to maintain a horse farm and centered on the tortious waste of property. Instead of following their own lead, the Washington Supreme Court performed the legal equivalent of a 180 and renamed the doctrine the “independent duty doctrine,” which now focuses on whether some separate duty of care exists independent of the parties’ contractual relationship, rather than focusing on the harm that was suffered:

In sum, the economic loss rule does not bar recovery in tort when the defendant’s alleged misconduct implicates a tort duty that arises independently of the terms of the contract. In some circumstances, a plaintiff’s alleged harm is nothing more than a contractual breach or a difference in the profits, revenue, or costs that the plaintiff had expected from a business enterprise. In other circumstances, however, the harm is simultaneously the result of the defendant breaching an independent and concurrent tort duty. Thus, while the harm can be described as an economic loss, it is more than that: it is an injury remediable in tort. The test is not simply whether an injury is an economic loss arising from a breach of contract, but rather whether the injury is traceable also to a breach of a tort law duty of care arising independently of the contract. The court defines the duty of care and the risks of harm falling within the duty’s scope.

Opinions about the implications of the new rule run the gamut, including speculation whether it is a new rule at all, or simply a narrowing of the interpretation of the economic loss rule. Indeed, the Eastwood court itself, in a footnote, argued that it was not disturbing “[t]he general rule . . . that a party to a contract can limit liability for damages resulting from negligence.” There is also a difference of opinion as to whether the new approach in Washington is a more, or less, fact-intensive inquiry for a court to undertake.

The real question is, given the wide range of interpretations of the economic loss rule across the country, how many courts will follow Eastwood? Will other states continue to narrow the interpretation? For that matter, how many other states will rename the doctrine something else entirely? Furthermore, will this have any immediate effect on the way parties build risk into their contracts and agreements? At least in Washington, that might be a good idea.