Abnormal Use » Seventh Circuit

No Class Action to Recover Return Costs of Toys Laced with Date Rape Drug

Nick Farr — Wed, 07 Sep 2011 11:30:18 +0000

In 2007, Spin Master Ltd. recalled more than four million Aqua Dots toys in the United States after discovering the product’s Chinese manufacturer mistakenly substituted 1,4 butanediol for the adhesive 1,5 pentanediol. When ingested, 1,4 butanediol metabolizes into gamma-hydrobutyric acid (GHB), otherwise known as the date rape drug. Reportedly, two children in the U.S. and three children in Australia were hospitalized after ingesting the product. We are guessing this is not what Wal-Mart had in mind when it deemed the product one of its “Top 12 Toys of Christmas.”

Not surprisingly, coating a child’s toy with a pre-metabolized date rape drug resulted in some legal action against the company and the product’s major retailer, Wal-Mart. Recently, in Aqua Dots Products Liability Litigation, — F. 3d —-, 2011 WL 3629723 (7th Cir. August 17, 2011), the Seventh Circuit issued an opinion regarding class certification in the multi-district litigation. The proposed class did not sue Spin Master due to any physical injury the plaintiffs suffered from the butanediol-coated toys. Rather, the plaintiffs elected not to pursue a refund from the distributor and challenged the adequacy of the company’s recall program. The District Court for the Northern District of Illinois, relying on Federal Rule of Civil Procedure 23(b)(3), denied the plaintiffs’ motion to certify the class holding that it would be more advantageous for the plaintiffs to return their products for a refund rather than pursuing litigation and racking up attorneys’ fees. Not happy with this result, the plaintiffs filed an interlocutory appeal.

The Seventh Circuit criticized the district court’s interpretation of Rule 23(b)(3). According to the rule, class certification is proper when “a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.” While it recognized the district court’s objective, the Seventh Circuit did not equate a recall campaign with a form of adjudication. Apparently, that three-judge panel has never attempted to return a product to Wal-Mart.

While the Seventh Circuit disagreed with the district court’s reasoning under Rule 23(b)(3), it ultimately agreed with the court’s decision – albeit under Rule 23(a)(4). Under Rule 23(a)(4), a court may certify a class action only if “the representative parties will fairly and adequately protect the interests of the class.” On that point, the Seventh Circuit had this to say:

Plaintiffs want relief that duplicates a remedy that most buyers already have received, and that remains available to all members of the putative class. A representative who proposes that high transaction costs (notice and attorneys’ fees) be incurred at the class members’ expense to obtain a refund that already is on offer is not adequately protecting the class members’ best interests.

There is no question about the inherent dangers of exposing young children to the date rape drug; however, it is nice to see a court stand up for a company who has acted reasonably under the circumstances. Spin Master acknowledged that a mistake had been made and took a reasonable course of action to remedy that mistake. Unless the proposed class can demonstrate some long-term physical harm due to 1,4 butanediol exposure, the only damage these plaintiffs have suffered is the time spent returning the product.

To be fair, we here at Abnormal Use have also had to return products a time or two and can attest to the hassle. Getting in the car, driving to the store, and – dare we say – waiting in line all amounts to time better spent doing anything else. It’s torture for sure, but somehow we endure. Even with the perils of this arduous task, however, we will gladly do it ourselves instead of paying a plaintiff’s attorney a 30 percent take to do it for us.

Tip of the hat to our friend, Ted Frank at the Point of Law blog for alerting us to this opinion.

The Case of the Reconditioned Lawnmower and Implications on Strict Liability

Frances Zacher — Wed, 15 Dec 2010 13:30:00 +0000

As we all know, a finding by a jury that a product is unreasonably dangerous will cause the manufacturer to be held strictly liable for any injuries the product causes. But what happens when the product itself has been used, “reconditioned,” and sold to someone else?

This was the question considered by the Seventh Circuit in Malen v. MTD Products, et al., No. 08-3855, 2010 WL 4670176 (7th Cir. 2010). Malen bought a Yard-Man riding lawnmower from Home Depot which was manufactured by MTD Products. The lawnmower was marketed by Home Depot as having been “reconditioned,” and the product came with a warranty. Malen took the lawnmower home and used it between 30 and 50 times without incident. One day, while mulching leaves, the lawnmower became wedged up against a curb and Malen couldn’t dislodge it. So, he stood up and tried to get off the lawnmower. There was conflicting information about the exact sequence of events, but it is undisputed that the blade of the lawnmower cut Malen’s foot, and he suffered permanent injuries.

According to industry standards, the lawnmower should have been equipped with two separate safety features–one that stopped the lawnmower blade if the operator stood up from the seat, and another that stopped the blade if the lawnmower was put into reverse. It was undisputed that at the time Malen test drove the lawnmower at Home Depot, the reverse safety function was not operational. Furthermore, it was uncontested that the blade did not stop when Malen stood up from the seat on the day of the accident.

As the Seventh Circuit pointed out, “Manufacturers and sellers are strictly liable for injuries caused by unreasonably dangerous products unless an unforeseen alteration by a third party introduced the unsafe condition.” Second, the court acknowledged that when products are used and sold “as is,” any unforeseen defects introduced by prior owners cannot be attributed to manufacturers and sellers. Both Home Depot and MTD attempted to show that the product had been altered by the first owner of the mower, by Malen, or by some other “nefarious person.” The court was not convinced.

It was, however, a case of first impression as to how Illinois courts would treat products that had been “reconditioned.” By reconditioning a product, the Seventh Circuit reasoned, is different than simply repairing a product, and in its opinion “extends the useful life beyond what was contemplated at the point of manufacture and effectively creates a new product.” The Seventh Circuit surmised that, as they have before, Illinois courts would follow the Restatement (Third) of Torts and apply strict liability in the case of re-manufactured products. On this basis, the Seventh Circuit found that the lawnmower, by failing to have the requisite safety measures in place, could be found unreasonably dangerous.

The court also concluded that a jury could find that the lawnmower was defectively designed, and the proximate cause of Malen’s injury on negligence theories. It reversed the grant of summary judgment for MTD and Home Depot, and remanded the whole case.

In this case, there was evidence that the safety measures were not properly connected or installed before the lawnmower was sold to its first owner. However, the decision has serious implications for manufacturers of products which are then “reconditioned” by someone else, and perhaps warranted by the retailer. If the reconditioned product later causes injury, the manufacturer may eventually be released from liability, but it obviously won’t prevent the manufacturer from being sued and forced to engage in expensive discovery as to the original condition and/or design of the product, and as to what modifications and/or repairs were performed on the product prior to resale, without the manufacturer’s knowledge and without compliance to the specifications of the manufacturer. All for the re-sale of a product for which the manufacturer saw no profits.

No Opinions Please

Kevin Couch — Thu, 01 Jul 2010 11:30:00 +0000

Before you file your motion for recusal, you better be pretty sure of yourself. When you petition for a writ of mandamus to order the judge to recuse himself, well, you’d better be really sure of yourself. I’m not certain how the lawyers for Sherwin Williams are feeling right now, but, if you’re confident enough to file said motion and petition, then maybe you think a lot of yourself regardless of the circumstances. In In re Sherwin Williams Co., No. 10-1639, 2010 WL 2244119 (7th Cir. June 7, 2010) [pdf], Judge Lynn Adelman is still in the case, despite the best efforts of Sherwin Williams.

Sherwin Williams took issue with a law review article co-authored by Judge Adelman, discussing several Wisconsin cases, one of which extended risk-contribution theory to manufacturers of white lead carbonate pigment manufacturers. See Thomas ex rel. Gramling v. Mallett, 701 N.W.2d 523 (Wis. 2005) [pdf]. If a plaintiff can prove that her lead poisoning injuries were caused by such pigments, then the plaintiff can recover against a manufacturer of the pigments. Though the Wisconsin decision was heavily criticized, Judge Adelman pointed out in his article that the decision was consistent with the judicial power endowed to the court by the state constitution. Sherwin Williams, of course, is not a big fan of this extension of liability. At the time that Judge Adelman authored the article, there were no pigment cases before him, but I’m sure shortly after the case was docketed, counsel for Sherwin Williams started the internal debate to decide whether to file the motion for recusal.

I think defendants ought to be aggressive. Too many times, in too many cases, defendants make the easy decision to settle, but I’m not sure that this was the case to say to the Judge, “Judge, we think you’re not capable of being impartial, and please step aside.” There seems to be a jurisdictional issue, in that Thomas is a decision by the Wisconsin Supreme Court, and Judge Adelman, sitting in diversity, would have to follow the law as set out by that court. To that end, it’s not clear what Sherman Williams hoped to gain by this move. Had the case been reassigned, the judge would still have to apply the substantive law of Wisconsin.

Second, extrajudicial writing should be encouraged, for the benefit of the law and for insight into how that judge perceives certain areas of the law. As lawyers, we should want judges to write. After all, if judges didn’t write, what would Congress use to grill judicial appointees for days on end while accomplishing relatively little unearthing of opinions heretofore unknown? Or perhaps judges might have some insight into how the system might be made better.

A Motorcycle Built for Two

Kevin Couch — Wed, 14 Apr 2010 11:30:00 +0000

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.