California Appellate Court Upholds Summary Judgment Where Expert Offers No Factual Basis for Opinion

The California Court of Appeals recently upheld summary judgment in favor of both defendants, an escalator manufacturer and Nordstrom department store, in a case where a shopper alleged she sustained injuries when an escalator stopped during a power outage. The court held that the opinions of the plaintiff’s motion engineering expert lacked adequate foundation. Bozzi v. Nordstrom, Inc., 111 Cal.Rptr.3d 910 (Cal. Ct. App. 2010).

The plaintiff was riding a Nordstrom escalator when an automobile accident outside the store caused an electrical service interruption, temporarily stopping power inside the store. The lights went out and the escalator stopped. The plaintiff had been holding on to one or both of the handrails, but alleged she was injured when her left foot moved down one step on the escalator. She did not fall. The power was out for approximately one minute before it was restored, at which time the lights came back on, the escalator descended to the first floor, and the plaintiff walked out of the store.

The plainitff sued both parties for negligence and failure to warn and included a strict liability action against the escalator manufacturer. It was the plaintiff’s theory that the defendants should have supplied an alternate power source for the escalator or otherwise have designed and maintained it such that it would have slowed to a gradual stop when the power went out. In support of her theory and in an effort to withstand summary judgment, the plaintiff proffered a motion engineering expert, who opined that there was “certain technology” available at the time of the escalator’s placement in 1985 that would have prevented the abrupt stop of which the plaintiff complained. It was his opinion that the fact that the escalator came to a jolting stop proved that there was a defect, because a properly designed and maintained escalator should not stop abruptly.

Although both the trial and appellate courts held that the plaintiff’s expert was properly qualified, they excluded as speculative and without foundation his conclusion that the escalator’s failure to come to rest in a power outage constituted faulty design or maintanence. An important factor in the courts’ conclusion was that the proffered expert had never seen, ridden or inspected the escalator. The appellate court held that he “relied on nothing more than syllogistic reasoning to conclude that if an escalator stops abruptly, it must have been defectively designed or maintained.”

An opinion is, according to the court, “only as good as the facts and reasoning on which it is based.” Because this expert failed state any facts to support his opinion, it was not appropriate for summary judgment analysis. This case is another illustration of an important defense victory where a plaintiff seeks to create issues of fact by offering unsubstantiated expert opinions.

Third Circuit Affirms Summary Judgment in Favor of Ford as a result of Plaintiff’s Lack of Expert Testimony

Have you ever thought that traveling in a vehicle going above 65 miles per hour could cause cancer? One Pennsylvania resident, Ted McCracken (“McCracken”), thought so and asked the Eastern District of Pennsylvania to award him damages as a result of such alleged injury. Pro se Plaintiff McCracken filed an action against Ford Motor Company asserting that he contracted thyroid cancer as a result of the insufficient protection Ford windshields provided from ambient radiation in the air that increases to dangerous levels inside a cabin when a vehicle travels at speeds in excess of 65 miles an hour. McCracken v. Ford Motor Co., No. 09-3995, 2010 WL 3010304 (3d Cir. Aug. 3, 2010) [PDF]. McCracken asserted eight causes of action, including strict products liability and defective design.

Ford filed a motion to dismiss on a number of grounds and the District Court of Pennsylvania dismissed all McCracken’s claims, except for strict products liability and defective design, and entered a scheduling order. Pursuant to this scheduling order, McCracken’s expert report was due on April 6, 2009. After this deadline had passed, McCracken filed a motion for an extension of time to retain an expert and a motion for the appointment of an expert under Fed. R. Evid. 706. The District Court denied his motions and Ford moved for summary judgment based upon McCracken’s lack of expert testimony. The District Court granted summary judgment in favor of Ford and McCracken appealed.

On appeal, McCracken asserted that he submitted sufficient evidence to survive summary judgment even without the testimony of an expert. This evidence included data regarding environmental radiation, a list of books and articles on radiation, the deposition testimony of a representative of the Pennsylvania Department of Environmental Protection, and affidavits from him and his mother stating that they observed increased readings on a Geiger meter when the vehicle accelerated. The Third Circuit found that this “evidence” was not enough to withstand summary judgment on the cause of McCracken’s cancer or the defective design of Ford’s windshields.

McCracken’s second argument on appeal is that the District Court erred in not appointing him an expert. The Third Circuit agreed with the District Court that “the purpose of Rule 706 is not to provide ‘litigation assistance’ to a party unable to retain an expert on its own.” The Third Circuit found no error by the District Court. McCracken asserted four more arguments on appeal, all not worth discussing here, which were all rejected by the Third Circuit.

This case is another example of a Plaintiff asking our Courts to buy into his or her theory of injury based on “because I said so.” The Third Circuit correctly found that Ford was entitled to summary judgement where plaintiff either could not find an expert to support his theory or he disregarded the court’s instructions by failing to find such an expert within their deadlines.

As a side note, this is McCracken’s thirteenth lawsuit asserting this general ambient radiation theory. He has sued numerous defendants including other automobile manufacturers, manufacturers of other types of vehicles that can travel in excess of 65 miles per hour, nuclear power plants, and energy companies. See McCracken v. R.E. Ginna Nuclear Power Plan, LLC, No. 08-cv-6217L, 2010 WL 1404115, at *4 (W.D.N.Y. Mar. 31, 2010).

Pennsylvania ATV Case Highlights the Difference Between Misuse and Unintended Use in Products Cases

In Smith v. Yamaha Motor Corporation, U.S.A., — A.2d —, 2010 WL 3239476 (Pa. Super. Ct. Aug. 18, 2010), an appeals court in Pennsylvania considered whether a trial court erred in granting summary judgment to Yamaha on claims of negligence and strict liability, and whether it erred by striking the report of Plaintiffs’ accident reconstruction expert in its entirety.

On September 23, 1999, Jeffrey Smith, an experienced ATV rider, was attempting to back his Yamaha ATV, more specifically a 1987 Yamaha Big Bear 350, down a hill when his foot slipped and struck the right-rear fender of the ATV. The fender collapsed, and his right leg became trapped between the frame and the wheel. The ATV then rolled back over Mr. Smith, causing him to suffer severe injuries that left him disabled and disfigured. According to the website, this ATV was Yamaha’s first 4×4 ATV:

Mr. Smith and his wife, Susan, sued Yamaha under theories of strict liability, negligence, and breach of warranty, and claimed that the rear fender and instrument panel were defective. Yamaha answered, and asserted that Mr. Smith was contributorily negligent by trying to back the ATV down the hill, and by consuming alcohol (Mr. Smith’s BAC was 75% below the legal limit) and taking drugs (he was ingesting prescription OxyContin for a degenerative back condition).
Yamaha’s motion for summary judgment as to Plaintiffs’ strict liability claims was granted on the grounds that Plaintiff was misusing the ATV at the time of the accident because the ATV manual, which Plaintiff acknowledged receiving, warned against consuming drugs or alcohol in connection with using the ATV, and also counseled against letting the ATV roll backwards on a hill. By doing all of these things, Yamaha argued, Mr. Smith was “operating the vehicle in an unintended manner” (emphasis added). Yamaha’s motion for summary judgment as to Plaintiffs’ claims for negligence was also granted, as was its motion to strike the expert report of Plaintiffs’ accident reconstruction expert, because it raised a new theory of recovery after the statute of limitations had expired.
The appellate court reversed the trial court’s striking of the expert’s report in its entirety, holding that even though part of the report did raise a new recovery theory following the statute of limitation’s expiration, the remainder of the report did not and, therefore, the offending portion should merely have been redacted. The expert, therefore, should have been allowed to propound his theories about the defectiveness of the design of the fender and the availability of alternative designs that would have prevented Plaintiff’s injuries.
With this part of the expert’s report back in evidence, Plaintiffs’ claims under the negligence theory were once again viable. The expert was allowed to opine that Yamaha’s design did not meet the state of the art at the time of design and manufacture of ATVs. The appellate court, therefore, reversed the trial court’s decision to grant Yamaha’s summary judgment motion on Plaintiffs’ negligence claims.
The most instructive portion of this decision, however, was the appellate court’s decision to reverse the granting of Yamaha’s motion for summary judgment on Plaintiffs’ strict liability claims. In doing so, the court explained that “the trial court conflated the doctrine of unintended use with the concept of misuse” (emphasis added). According to the appellate court, Plaintiff was indeed operating the ATV for its intended use–off-road riding. What he may have been doing, however, was misusing the vehicle by operating it in a manner not intended by the manufacturer–backwards and potentially under the influence of drugs and alcohol. Finally:
It is well-settled that a plaintiff’s misuse of a product cannot be grounds for granting summary judgment in favor of the manufacturer under a design defect theory unless it is established that the misuse solely caused the accident while the design defect did not contribute to it.

Because the evidence of Plaintiff’s riding on the date of the accident went to the issue of misuse, rather than unintended use, and because there was evidence that a design defect may have caused or at least contributed to the accident, the trial court’s grant of summary judgment was reversed.

Being an Expert Expert Doesn’t Make You an Expert

You know him well. He is the professional expert. No matter the issue, the case, or the product, there he is, opining that your client’s product is unreasonably dangerous, and unquestionably caused the plaintiff to suffer personal injuries, psychological damage, and lost income. In fact, as soon as you see this expert’s name at the top of the report, you can recite its contents, eyes closed and one hand tied behind your back.

Not so fast. In Beam v. McNeilus Truck and Manufacturing, Inc., 697 F. Supp. 2d 1267 (N.D. Ala. 2010), the Northern District of Alabama considered the defendant’s motion to exclude the testimony of Dr. L.D. Ryan, a mechanical engineer and professional expert, as to the defectiveness of the design of a garbage truck. The case involved an accident in which the plaintiff’s decedent, a garbage collector, fell or stepped off of the riding step of a garbage truck and died as a result of his injuries. The central issue of the case was whether the truck was defectively designed with regard to the riding steps.

The court carefully considered Dr. Ryan’s qualifications, noting that “Plaintiff’s expert . . . has little or no experience in the world of refuse collection, road-vehicle design generally, or garbage truck design specifically.” Furthermore, although Dr. Ryan had watched “three hours of videos on ‘YouTube,’ he has no training or experience in designing waste-hauling routes” and has no knowledge “about the history or evolution of rear-loading garbage-truck designs.” In fact, the court stated, the “mere fact that Dr. Ryan is a licensed engineer is, in and of itself, insufficeint to qualitgy him as an expert in this case.”

The court’s harshest criticism of Dr. Ryan’s so-called qualifications, however, was reserved for his status as the professional expert. The court made several references to the fact that Dr. Ryan had acted as an expert in hundreds of cases. In fact, the court devoted an entire footnote to Dr. Ryan’s career expertise, opining that “Dr. Ryan has been involved in hundreds of cases invovling a variety of products, and his testimony has been at issue in a number of those cases,” and providing a list of some of those cases.

With no actual expertise on the subject of garbage truck design, the court excluded Dr. Ryan and his reports. Without expert testimony as to the defective design, the plaintiff could not make her case, and therefore the defendant’s motion for summary judgment was also granted.

Bravo, Northern District of Alabama. Abnormal Use salutes you. Next time, plaintiffs, make sure your expert does more than watch YouTube.

The Perils of "Free" Experts and Their Testimony

Oftentimes, practitioners will get lazy. They will seek to use the treating physician as the expert in their case. This is typically the case when the issue of causation seems clear. However, intuition and surmise are not enough to survive a summary judgment motion . . . at least not in the federal courts. In a recent opinion, the United States District Court for the Middle District of Georgia granted the defendant’s motion for summary judgment. In Williams v. Mast Biosurgery USA, Inc., No. 7:08-CV-114(HL), 2010 WL 2104955 (M.D. Ga. May 24, 2010), the court found that the plaintiff’s case must be dismissed for her failure to present evidence that the product was defective.

The plaintiff in Williams had undergone an exploratory laparotomy procedure conducted by Dr. David W. Adcock, II. Williams at*1. The purpose of the procedure was to remove adhesions that had formed after a prior surgery. Id. During the procedure, Dr. Adcock utilized a product, SurgiWrap, to “prevent future adhesions and to enhance Plaintiff’s likelihood of conception.” Id. Approximately two months after this procedure, the plaintiff developed pain in her sides as was admitted to the hospital whereupon a colonoscopy revealed the plaintiff had a perforated colon. Id. The physician that performed the procedure to repair the plaintiff’s perforated colon, “discovered and removed several pieces of ‘pliable’ plastic.” Id. The plaintiff then brought suit against the manufacturer of SurgiWrap upon a theory of strict liability. She contended that the product was defective since it did not properly dissolve inside her body. Id. On the issue of causation, the plaintiff sought to utilize Dr. Adcock (the physician that utilized the product at issue during the first surgery), Dr. George E. Yared (the physician that performed the colonoscopy), Dr. Robert Brown (the physician that repaired her colon) and Dr. Robert Nelms, Jr. (the pathologist that examined the removed pieces of plastic from the plaintiff’s body) to establish that the removed pieces of plastic were in fact SurgiWrap and that the product was defective. Id.

The defendant filed a Motion to Exclude Plaintiff’s Expert Testimony, and these physicians were prevented from testifying regarding the identification of the product and whether the product failed to operate as intended by the manufacturer. Furthermore, three of the physicians were prevented from testifying on the issue of causation. Id. The court essentially found that these physicians did not have the requisite familiarity with the product at issue in order to testify that the product was defective and that the alleged defect caused the plaintiff’s injury. Id. at*1-2.
There are multiple lessons to be learned from this case. First, if you represent a plaintiff in a products case you should be wary of settling for the treating physicians to establish the prima facie case. Second, and most importantly, if you a representing a manufacturer don’t give up so easily. The physician that is trained to utilize your surgical device may not be qualified to sufficiently identify the product, much less testify that it is defective. Daubert challenges to treating physicians are always worth the effort.

Ninth Circuit Affirms Exclusion of Two Experts in Products Case in Eight Paragraphs

We here at Abnormal Use adore concise, get-to-the point jurisprudence, which is why we pause today to reflect upon the Ninth Circuit’s recent eight paragraph memorandum opinion in Shalaby v. Newell Rubbermaind, Inc., No. 09-56331 (9th Cir. May 17, 2010) (unpublished) [PDF]. To reduce the disposition of a products liability action to eight paragraphs is sublime.

In that case, the Plaintiffs, apparently from California, filed a products liability action after Mr. Shalabay was allegedly injured “when a handheld, gas-powered torch that he had purchased from a Home Depot store exploded.” Ever so briefly and succinctly, the Ninth Circuit observed that expert testimony is required in products liability matters to establish causation when the theory is “beyond common experience,” and because the Plaintiffs’ two proffered experts had been properly excluded by the trial court, the Plaintiff had no case. Thus, the Ninth Circuit affirmed the ruling of the district court, which had initially excluded both experts.

The money paragraphs were:

The court excluded the testimony of one of those witnesses, Dr. Anderson, a metallurgy expert, as unreliable and irrelevant. To support his theory that a design defect in the torch caused the explosion, Dr. Anderson conducted two tests on exemplar torches to demonstrate the flaw. The district court concluded that because Dr. Anderson had performed only two non-standardized tests, on torches that may have been different from the one here at issue, and did not adequately explain the results of or discuss the possible rate of error for such tests, his testimony would be unreliable. It would also be unreliable because he did not address certain contradictory evidence. Finally, he did not present adequate evidence that the design flaw caused Shalaby’s injuries, rendering his testimony irrelevant.

The district court excluded the testimony of the other witness, Dr. Vredenburgh, because she was not a qualified expert and, even if she were, her testimony was unreliable and irrelevant. Dr. Vredenburgh’s field of expertise was not torches; she had some experience in the formulation of warning instructions for various devices. When asked whether a different or larger warning would have helped in Shalaby’s case, Dr. Vredenbugh testified that “I don’t know why [the torch] failed, so I don’t know that a warning would have helped.” She stated that she had never operated a handheld torch and had not seen one operated in seventeen years. She had not spoken to any users of handheld torches in many years, and she had incorrectly testified about how such a torch is used. Dr. Vredenburgh admitted that she did not collect any empirical data, did not conduct any testing, did not conduct any surveys, did not seek data from manufacturers, did not review any peer-reviewed literature, did not conduct any other kind of research prior to forming her opinion, and did not follow her own typical process for developing product warnings.

Sure, maybe the conclusion was so easily reached that it only merited an eight paragraph opinion. But it’s nice to see such a case given short shrift.

More than 10 Years Later, Drug Settlement Litigation is Still Going

On November 19, 1999, American Home Products Corporation, now known as Wyeth, entered into a settlement agreement with class members of a diet drug nationwide class action, creating a settlement trust to pay claims of class members that were injured by ingesting certain diet drugs. On August 28, 2000, the Eastern District of Pennsylvania entered an order certifying and approving the nationwide settlement class. Now, more than 10 years later, there is still litigation surrounding claimants seeking benefits under this settlement agreement.

In fact, in the past two weeks, on April 6, 2010 and April 13, 2010, the Eastern District of Pennsylvania and Third Circuit, respectively, upheld the decisions by the settlement trust to deny benefits. In re Diet Drugs Products Liability Litigation, No. 99-20593, 2010 WL 1404624 (E.D. Pa. Apr. 6, 2010); In re Diet Drugs Products Liability Litigation, No. 09-2424, 2010 WL 1473752 (3d Cir. Apr. 14, 2010).

The decision by the Eastern District of Pennsylvania on April 6, 2010 involved claimant Betty Brown-Riddle. In order to seek benefits from the trust, Brown-Riddle had to submit evidence that she she suffered from “moderate aortic regurgitation,” as set forth in the Settlement Agreement. Brown-Riddle submitted a statement by her treating physician that she suffered from “mild to moderate aortic insufficiency.” Thereafter, the trust forwarded Brown-Riddle’s claim for review. The reviewing physician found that there was no reasonable medical basis for her treating physician’s finding that she suffered from moderate aortic regurgitation. As a result, the trust denied her claim and she sought review. After a series of administrative reviews pursuant to the Settlement Agreement, Brown-Riddle’s found its way into the district court for review.

The Court found that Brown-Riddle merely disagreed with the reviewing physician’s determination that she lacked a medical basis for her claim. She failed to identify or substantiate any specific errors and rested on her physician’s “check-the-box diagnoses.” The Court affirmed the decision of the trust denying benefits.

Similar to the above case, on April 13, 2010, the Third Circuit reviewed a claim of a class member that had been denied benefits. In this case, the Court affirmed the decision of the district court that the claimant did not provide adequate proof of diet drug ingestion required to support her claim because her supporting affidavits provided a dispense date when the drugs were off the market and stated dosages that were inconsistent with the dosages at which the drugs were issued. Further, addressing an argument by claimant, the Court found that the form she had to fill out in connection with her claim for benefits did not constitute a contract for benefits.

These decisions by the the Eastern District of Pennsylvania and the Third Circuit show that even when a mass class action is settled, litigation continues and our courts are continually asked to evaluate expert evidence as it would in a case of traditional posture. Plaintiffs in these types of cases are not off the hook of providing expert testimony. It will be interesting to note when litigation surrounding this class settlement ends — 10 more years, maybe 20.

A Motorcycle Built for Two

To capitalize on our increasing popularity, the contributors at Abnormal Use have floated the idea of pursuing product sponsorship deals, e.g., Old Spice becoming the official deodorant of the blog. Today, I adopt the Honda Gold Wing as the blog’s unofficial motorcycle. No motorcycle better speaks to the classic risk-aversion of the defense attorney. I, personally, have never seen a Gold Wing rider 1) without a helmet or 2) cruise at a speed in excess of 35 miles per hour. In addition, the design of the Gold Wing promotes the use of Daubert against all oncoming Plaintiffs’ attorneys.

In American Honda Motor Co. v. Allen, No. 09-8051, 2010 WL 1332781 (7th Cir. Apr. 7, 2010) the Seventh Circuit considered the application of Daubert prior to an order certifying a class. Honda sought leave to appeal the district court’s grant of class certification. Plaintiffs, unhappy purchasers of Gold Wings, asserted that the bike had a design defect: Namely, the motorcycle does not properly compensate for “wobble.” Imagine the front wheel of your bike shaking from right to left to the point where you would lose control. (Note: A Google search will reveal multiple videos on motorcycle wobble not appropriate to link here.). Plaintiffs’ claims were based entirely on the expert report of Mark Ezra, who has testified against Honda since the mid-1980s. Ezra developed a wobble decay standard, which set forth that a motorcycle, by its design, should dissipate a certain amount of wobble so that the rider does not react to the wobble.

The District Court, for multiple reasons, was critical of Mr. Ezra’s science, but declined to exclude him at such an early stage of the proceedings. The Seventh Circuit ruled that this failure to exclude was an abuse of discretion and “exclusion is the inescapable result” in this matter. Going forward, the Seventh Circuit noted that some substantive decisions may have to be made prior to deciding the motion for class certification.

We hold that when an expert’s report or testimony is critical to class certification, . . . a district court must conclusively rule on any challenge to the expert’s qualifications or submissions prior to ruling on a class certification motion.

Id. No longer can a Plaintiff bootstrap his way to class certification by hiring an expert. As we noted earlier here, the Seventh Circuit seems earnestly concerned in making sure Defendants are treated fairly in federal class actions, or, in this case purported class actions. While Plaintiffs’ complaint may pass muster under Iqbal/Twombley, the Seventh Circuit sends yet another message to Plaintiffs: Consider Daubert before filing your class action. Moreover, the Seventh Circuit has set forth another method for a court to consider the substance of a lawsuit early in the litigation. Defendants, begin working on your Daubert motions right away.

Contact Lens Solution MDL Matter Partially Resolved for Lack of Expert Testimony

In a recent Multidistrict Litigation products liability matter pending in South Carolina, Chief Judge David C. Norton of the U.S. District Court for the District of South Carolina found in favor of manufacturer, Bausch & Lomb Inc., on a motion for summary judgment as a result of Plaintiffs’ failure to provide sufficient expert testimony. In re Bausch & Lomb Inc. Contacts Lens Solution Prods. Liab. Litig., C/A No. 2:06-MN-77777, MDL No. 1785, 2010 WL 597184 (D.S.C. Feb. 17, 2010).

On April 13, 2006, ReNu with MoistureLoc contact lens solution, manufactured by Bausch & Lomb in its Greenville, South Carolina facility, was voluntarily withdrawn from the market in the United States when an increased number of consumers who used MoistureLoc began to develop Fusarium keratitis. On May 11, 2006, Bausch & Lomb met with the Federal Drug Administration and announced that they decided to remove the product from the market worldwide.

Subsequent to this recall, a number of individual personal injury cases emerged around the country asserting they were injured as a result of the use of MoistureLoc. These actions were consolidated into this Mulitdistrict Litigation proceeding and each Plaintiff had to submit a fact sheet and medical documentation demonstrating use of MoistureLoc and the type of eye infection that resulted. As of the date of Bausch & Lomb’s motion for summary judgment, “348 Plaintiffs had not submitted any documentation showing that they experienced a Fusarium keratisis infection.” Judge Norton’s order concerns these “non-Fusarium Plaintiffs.”

In May 2009, Baush & Lomb moved to exclude the testimony of Plaintiffs’ expert, Dr. Elisabeth Cohen, with respect to non-Fusarium infections. As reported by the Drug and Device Law blog on August 27, 2009, Judge Norton, along with Judge Shirley Werner Kornreich of the Supreme Court of the State of New York, granted Baush & Lomb’s motion to exclude “Dr. Cohen’s general causation opinions relating to non-Fasarium infections.”

Following this ruling, Baush & Lomb moved for summary judgment on all claims and causes of action asserted by non-Fusarium Plaintiffs. Notwithstanding five individual cases that remain under advisement for various reasons, the U.S. District Court for the District of South Carolina granted Baush & Lomb’s motion for failure to prove causation. The Court explained that “[t]o establish medical causation in a product liability case, a plaintiff must show both general causation and specific causation[,]” meaning that Plaintiffs must show that the “substance [at issue] is capable of causing a particular injury” and that the “substance caused a particular individual’s injury.” Proof of general causation was a precursor to proving specific causation. The Court determined that this was the applicable rule is all jurisdictions, including Puerto Rico where some Plaintiffs resided.

The Court concluded that since Plaintiffs’ general causation expert, Dr. Cohen, was excluded, Plaintiffs could not prove general causation, and thus, could not prove the essential causation element of any products liability action. Further, the Court disagreed with Plaintiffs’ assertion that they could prove causation through Physicians’ differential diagnoses. This is a “technique of identifying the cause of a medical problem by eliminating the likely causes until the most probable one is isolated.” Judge Norton stated that Plaintiffs could not rely on this technique to “end-run” the general causation requirement.

All defense practitioners should be aware, for future use, of Judge Norton’s holdings requiring both general and specific causation and not allowing the use of the differential diagnoses technique to prove general causation.

Since Judge Norton’s ruling on February 17, 2010, two individual non-Fusarium Plaintiffs have filed motions to alter or amend the judgment pursuant to Rule 59(e) of the Federal Rules of Civil Procedure, Baush & Lomb has filed a response to one Plaintiff’s motion, and Baush & Lomb has filed a motion for summary judgement as to all other non-Fusarium Plaintiffs that were inadvertently not included in the February 2010 order. Therefore, be on the lookout for further rulings on the non-Fusarium Plaintiffs in addition to resolution of those claims by Fusarium

Plaintiffs, which Drug and Device Law blog reported in August may be resolving out of court.

South Carolina Supreme Court on Expert Witnesses and Punitive Damages

The South Carolina Supreme Court recently weighed in again on two issues near and dear to the hearts of those who have an active products liability practice: (1) the admissibility of expert witness testimony and (2) punitive damages. In Austin v. Stokes-Craven Holding Corp., — S.E.2d —-, No. 26784, 2010 WL 760410, (S.C. March 8, 2010), the Supreme Court considered the admissibility of two experts offered by the Plaintiff and whether the punitive damages awarded to that Plaintiff were excessive. In Austin, the Plaintiff filed suit against Stokes-Craven Holding Corporation, d/b/a Stokes Craven Ford, an automobile dealership, after he experienced problems with a vehicle that he purchased used from the dealership. As it turned out, the vehicle had sustained extensive damage in an accident prior to the sale of the vehicle to the Plaintiff, requiring repairs to the tune of over $20,000. Problems ensued even following repairs when the vehicle developed an oil leak, finally prompting the first owner to trade in the vehicle.

When the Plaintiff went to purchase the vehicle, he asked a series of questions related to the extent of the warranty, whether the vehicle had been wrecked, and questions regarding the previous owner. In response, the Plaintiff was informed that the warranty was a “5-year, 100,000 miles powertrain warranty,” that the truck had not been wrecked, and that the previous owner may have been someone with whom the Plaintiff was familiar and considered to be very responsible with regard to vehicle maintenance. A couple of months after purchase, the Plaintiff discovered an oil leak, which he then sought to have repaired. It was then that the Plaintiff was told by the Defendant that the vehicle was not covered by a 5-year, 100,000 mile power train warranty. The Plaintiff further discovered that the vehicle had a 5-year, 100,000 mile warranty limited to the engine, that the truck had been registered to a person different from the person whom the Plaintiff believed first owned the vehicle, and that the vehicle had sustained extensive damage prior to Plaintiff’s purchase. The dealership further provided the Plaintiff with a “Buyer’s Guide” document purportedly containing the Plaintiff’s signature that confirmed that the warranty was only up to 100,000 miles on the diesel engine. The Plaintiff adamantly denied that he signed or ever received the document. After the Plaintiff’s repeated requests to receive a return of the purchase price in exchange for the vehicle were rejected, he filed suit under multiple causes of action.

At the conclusion of trial, the Plaintiff was awarded actual and punitive damages on his causes of action for negligence, fraud, constructive fraud, and violation of the Dealer’s Act, with actual damages being awarded in the amount of $26,371.10 on each cause of action and punitive damages in the amount of $216,600 as to the Plaintiff’s cause of action for fraud. Among the multiple issues on appeal were the admissibility of experts and excessiveness of punitive damages.

The Defendant argued that the trial judge erred in qualifying two of the Plaintiff’s witnesses as experts in the areas of auto-body repair and in appraisal and valuation of Plaintiff’s truck, respectively. As was not unexpected, in both instances, the South Carolina Supreme Court found that the Defendant was not prejudiced by the admission of the expert’s testimony. Key to the Court’s ruling appeared to be its conclusion that the Defendant was able to extensively cross-examine the experts on their qualifications and their ultimate conclusions.

On the issue of punitive damages, the Court applied the guideposts set forth in the recent decision in Mitchell v. Fortis Ins. Co., 385 S.C. 570, 686 S.E.2d 176 (2009), to be applied in conducting a post-judgment review of punitive damages awards, those being: (1) the degree of reprehensibility of defendant’s misconduct; (2) the disparity between the actual and potential harm suffered by the plaintiff and amount of the award; and (3) the difference between the punitive damages awarded and civil penalties authorized or imposed on comparable cases.

As to reprehensibility, multiple additional factors are considered, including whether (1) the harm is physical versus economic; (2) the conduct evinced an indifference to or a reckless disregard for the health or safety of others; (3) the target of the conduct had financial vulnerability; (4) the conduct involved repeated actions or was an isolated incident; and (5) the harm was the result of intentional malice, trickery, or deceit, rather than mere accident. Here, the Court found that, even though the harm was economic, that fact did not minimize the reprehensibility of the dealership’s conduct. The dealership’s employees failed to disclose that the truck had been wrecked and did not have a power train warranty and potentially forged the Plaintiff’s signature to a document in an effort to legitimize the lack of the power train warranty. The Court found that those acts evinced an indifference to or a reckless disregard the health and safety of the Plaintiff and the general public that would share the road with the potentially unsafe vehicle, that the Plaintiff was financially vulnerable, and that the incidence was not isolated in that the dealership’s employee testified that he had never shown a title to a customer.

Turning to the ratio, the Court admitted that an 8.21 ratio was high, particularly given the type of injury. However, the Court noted that it was a single-digit ratio; there was evidence of the Defendant’s ability to pay; that given the extent of wreck damage and resultant safety issues, there was potential for the Plaintiff and his passengers to be subjected to serious injury; and the amount of the award would serve as a deterrent to future misconduct.

Finally, the Court endeavored to review factually-similar cases to assess the reasonability of the award. In doing so, it cited cases from Missouri and Oregon in which plaintiffs had purchased used vehicles that had a past and in which significant punitive damage awards had been affirmed. Accordingly, in light of the above, the Court affirmed the punitive damages award rendered by the jury. Whereas Justice Pleicones dissented in part from the majority opinion, he nonetheless found that punitive damages were warranted, although he would have reduced such damages to $100,000.