Justia Products Liability Opinion Summaries

Several counties and municipalities in New York initiated lawsuits in state courts against two pharmacy benefit managers, Express Scripts, Inc. and OptumRx, Inc., alleging that these companies contributed to the opioid epidemic in their communities. The claims are based on state law and center on the defendants’ alleged practices in negotiating with opioid manufacturers and managing prescription formularies, which plaintiffs contend led to an oversupply of prescription opioids and caused substantial public harm and government expense.The defendants removed the cases to federal court—the United States District Courts for the Southern and Eastern Districts of New York—arguing removal was proper under the federal officer removal statute, 28 U.S.C. § 1442(a)(1), because some of the challenged conduct was performed under contracts with federal agencies, such as the Department of Defense (TRICARE), the Office of Personnel Management (FEHBP), and the Veterans Health Administration. After removal, the plaintiffs amended their complaints to disclaim any claims based on the defendants’ work for federal clients, seeking to have the cases remanded to state court. The district courts accepted the disclaimers and remanded the cases.The United States Court of Appeals for the Second Circuit reviewed the district courts’ decisions. It concluded that the disclaimers were ineffective because the alleged wrongful conduct and resulting harms could not be separated between federal and non-federal clients; the conduct was indivisible. Relying on the Supreme Court's decision in Chevron USA Inc. v. Plaquemines Parish, the Second Circuit held that the defendants satisfied all statutory requirements for federal officer removal: they acted under federal direction, were sued for acts relating to federal authority, and asserted colorable federal defenses. The Second Circuit therefore reversed the remand orders and returned the cases to the district courts for further proceedings. View "County of Westchester v. Express Scripts" on Justia Law

Cheryl Walker used her Uber account to order a guest ride for her husband, Carroll Walker. Carroll had never downloaded the Uber app or created an account, and he consistently stated that he does not read or reply to text messages. On the relevant occasion, Cheryl ordered a ride for Carroll, and Uber sent Carroll a text message with ride details and a hyperlink to its Terms of Use, which included an arbitration provision. Carroll did not see the message. During the ride, an accident occurred, allegedly due to the driver’s distraction by Uber’s app, resulting in severe injuries to Carroll.In the United States District Court for the District of Columbia, Cheryl Walker sued Uber on Carroll’s behalf, asserting negligence and products liability claims. Uber moved to compel arbitration, arguing Carroll was bound to arbitrate either because he had notice of the Terms via Uber’s text message or as a third-party beneficiary of Cheryl’s contract with Uber. The district court denied Uber’s motion, finding Uber failed to establish that Carroll was on inquiry notice of the Terms and concluding that Carroll was not bound as a third-party beneficiary or estopped from refusing arbitration.The United States Court of Appeals for the District of Columbia Circuit reviewed the district court’s denial of Uber’s motion to compel arbitration de novo, applying D.C. contract law. The Court held that Uber had not shown Carroll agreed to be bound by its Terms of Use, as Carroll lacked actual or inquiry notice of the Terms. The Court further determined that Carroll was not bound by Cheryl’s contract as a third-party beneficiary or by equitable estoppel, since Carroll was not seeking to enforce Cheryl’s contract and his claims were independent of it. The judgment of the district court was affirmed. View "Walker v. Uber Technologies, Inc." on Justia Law

The Village of Schaumburg owns a hotel and convention center that it alleges has defective exterior walls. In February 2022, it initiated a lawsuit in the United States District Court for the Northern District of Illinois, Eastern Division, against several parties for fraud, breach of warranty, and products liability. In November 2022, the Village added Permasteelisa North America, a subcontractor, as a defendant. About eight months later, the Village sought to compel arbitration of its dispute with Permasteelisa, even though it had not previously requested arbitration in its complaint or before filing suit, and the arbitration clause was contained in a contract between Permasteelisa and the general contractor, not the Village directly.The District Court concluded that by filing a lawsuit and then delaying its request for arbitration, the Village presumptively waived any right to arbitrate it might have had. The Village argued that the lawsuit was filed to avoid the statute of limitations expiring, but the District Court responded that the Village should have requested arbitration at the outset or, at the latest, soon after Permasteelisa’s motion to dismiss was filed. The court found that the combination of filing suit and substantial delay amounted to waiver of any right to arbitrate and denied the Village’s motion to compel arbitration.On appeal, the United States Court of Appeals for the Seventh Circuit reviewed the District Court’s decision for abuse of discretion. The appellate court held that the District Court did not err in concluding that the Village waived any right to arbitrate by acting inconsistently with that right through both initiating litigation and delaying the arbitration request. The Seventh Circuit also rejected the argument that a contractual anti-waiver clause could override federal procedural rules governing litigation conduct. The judgment of the District Court was affirmed. View "Village of Schaumburg v Permasteelisa North America" on Justia Law

A professional track and field athlete received a bottle of Gatorade Recovery Gummies at an award ceremony hosted by Gatorade, which were labeled as “NSF Certified for Sport,” indicating independent testing for banned substances. After consuming the gummies, the athlete submitted a routine drug test that later returned positive for cardarine, a banned performance-enhancing drug, resulting in immediate suspension from elite competition. Subsequent investigation revealed that the gummies lot the athlete received had never been NSF certified, and Gatorade was aware of the mislabeling before distributing the product. The athlete suffered significant consequences, including loss of eligibility to compete, loss of a scholarship, and forfeiture of endorsement opportunities.The athlete initiated legal action in the United States District Court for the Southern District of New York, alleging strict products liability, negligence, negligent misrepresentation, violation of Texas’s Deceptive and Unfair Trade Practices Act, tortious interference with contract, and intentional infliction of emotional distress. The district court dismissed all claims. It found no “cognizable injury outside of purely economic damages” for the strict liability, negligence, and misrepresentation claims, applying New York’s economic loss doctrine. Additional claims were dismissed based on statutory definitions and insufficient allegations of extreme conduct or distress.On appeal, the United States Court of Appeals for the Second Circuit reviewed the dismissal de novo. It affirmed the district court’s dismissal of the tortious interference, consumer protection, and emotional distress claims. However, the court recognized uncertainty in New York law regarding tort recovery for nonconsensual bodily changes detectable only by laboratory testing and the boundaries of the economic loss doctrine. Accordingly, the Second Circuit deferred decision and certified two questions to the New York Court of Appeals concerning the scope of the economic loss doctrine and whether the athlete’s injury is cognizable in tort under New York law. View "Asinga v. Gatorade Co." on Justia Law

Jeffrey Olson leased a Jeep Grand Cherokee from a car dealership under a lease agreement that included an arbitration provision and a delegation clause, which assigned questions about the scope of arbitration to an arbitrator. FCA US, LLC, the manufacturer of the Jeep, was not a signatory to the lease agreement. Olson later became the named plaintiff in a federal class-action lawsuit against FCA, alleging defects in the vehicle’s headrest system. FCA, not being a party to the lease, sought to compel Olson to arbitrate the dispute based on the arbitration agreement between Olson and the dealership.The United States District Court for the Eastern District of California denied FCA’s motion to compel arbitration. The district court found that FCA, as a non-signatory to the lease agreement, could not enforce the arbitration provision or its delegation clause against Olson. The court concluded that the arbitration agreement applied only to Olson and the dealership (including its employees, agents, successors, or assigns), and FCA did not qualify under any of those categories. Additionally, the court rejected FCA’s argument that it could use equitable estoppel to compel arbitration, holding that none of Olson’s claims were sufficiently intertwined with the lease agreement to justify such an exception under California law.The United States Court of Appeals for the Ninth Circuit affirmed the district court’s decision. The Ninth Circuit held that FCA could not compel Olson to arbitrate because FCA was not a party to the arbitration agreement and no applicable exception—such as equitable estoppel—applied. The court clarified that, under both federal and California law, only parties to an arbitration agreement (or those qualifying under specific, limited exceptions) may enforce it. The court also rejected FCA’s reliance on Supreme Court precedent, finding it inapplicable to non-signatories in these circumstances. View "OLSON V. FCA US, LLC" on Justia Law

A homeowner alleged that he hired a roofing company in 2011 to install a specific type of roof on his residence. After installation, problems with roof materials became apparent, including issues with a protective layer that remained unresolved despite multiple repair attempts by both the roofing company and the manufacturer over more than a decade. The homeowner asserted that these defects persisted, and that communication from the roofing company ceased in early 2024. As a result, he filed a lawsuit in Etowah County, Alabama, alleging breach of express and implied warranties, as well as negligent or wanton installation and repair, and sought damages.The roofing company moved to dismiss the lawsuit for improper venue, arguing that a forum-selection clause in a “Service Agreement” required all disputes to be heard in Madison County, Alabama. The company attached an unsigned and undated sample agreement to its motion, but did not produce a copy signed by the homeowner or any evidence that the homeowner had agreed to such a clause. The homeowner responded that he had never signed, nor was he aware of, the agreement submitted by the company and also challenged the clause’s reasonableness. The Etowah Circuit Court denied the company’s motion to dismiss for improper venue.The Supreme Court of Alabama reviewed the company’s petition for a writ of mandamus, which sought to compel the lower court to dismiss the case or transfer it to Madison County. The Supreme Court held that the company failed to meet its burden of proving that the forum-selection clause applied, as it did not present evidence linking the blank agreement to the parties’ actual contract. Therefore, the Supreme Court of Alabama denied the petition, concluding that the circuit court did not clearly err in refusing to dismiss or transfer the case. View "Ex parte Continental Roofing Company, LLC" on Justia Law

Delta Airlines contracted with Lands’ End to supply new uniforms for its employees, which were manufactured overseas and distributed to approximately 64,000 workers. After the uniforms were issued, many employees reported that the garments transferred dye onto other surfaces and caused a range of health symptoms, including skin irritation and respiratory issues. Two groups of Delta employees filed lawsuits: one group sought damages for property damage and breach of express warranty as intended beneficiaries of the contract between Delta and Lands’ End, while the other group pursued personal injury claims, alleging the uniforms were defectively manufactured or designed and that Lands’ End failed to warn of these defects.The United States District Court for the Western District of Wisconsin consolidated the actions and, after discovery, granted summary judgment in favor of Lands’ End on all claims. For the personal injury claims, the court excluded the plaintiffs’ expert testimony on defect and causation, finding the opinions unreliable under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc. The court also found that the plaintiffs failed to present sufficient evidence that the uniforms were defective or that any defect caused their injuries. On the breach of warranty claim, the court determined that Lands’ End had not breached the contract’s satisfaction guarantee because plaintiffs had not returned their uniforms as required by the contract’s terms.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court’s judgment. The Seventh Circuit held that the exclusion of the plaintiffs’ expert testimony was not an abuse of discretion, as the experts failed to reliably establish defect or causation. The court also held that summary judgment on the breach of warranty claim was proper because the contract’s return requirement was reasonable and not an unlawful limitation on the express warranty. The district court’s judgment was affirmed in full. View "Gilbert v Lands' End, Inc." on Justia Law

A pet food manufacturer, Sunshine Mills, had a longstanding business relationship with Nutra-Blend, a supplier of animal nutrient products. For years, Sunshine Mills ordered a specific concentration of Vitamin D3 (Vitamin D3 7500) from Nutra-Blend for use in its dog food. In 2017, due to a miscommunication, Nutra-Blend shipped a different, much more concentrated product (Vitamin D3 500) instead. Sunshine Mills, unaware of the difference and believing Nutra-Blend only sold one type of Vitamin D3, accepted and used the product, resulting in several dogs developing Vitamin D toxicity, with some becoming ill or dying.After the incident, Sunshine Mills sued Nutra-Blend in the Lee County Circuit Court, alleging breach of contract, breach of implied warranty, a claim under the Mississippi Products Liability Act (MPLA), and common-law negligence. Nutra-Blend moved for summary judgment, arguing that all claims were subsumed by the MPLA and failed on other grounds. Sunshine Mills abandoned its tort-based claims, leaving only the contract-based claims. The Lee County Circuit Court granted summary judgment to Nutra-Blend on all claims, finding no genuine issues of material fact.The Supreme Court of Mississippi reviewed the case and held that the MPLA does not govern Sunshine Mills’ remaining claims because they do not allege damages caused by a defective product, but rather by breach of contract and implied warranty. The court clarified that the MPLA applies only to claims for damages caused by defective products, not to contract-based claims between commercial entities. The court also found that genuine issues of material fact existed regarding both the breach of contract and implied warranty claims, precluding summary judgment. Accordingly, the Supreme Court of Mississippi reversed the trial court’s decision and remanded the case for further proceedings. View "Sunshine Mills, Inc. v. Nutra-Blend, LLC" on Justia Law

A general contractor was hired to oversee the construction of a hotel in Vermont and subcontracted with a firm to install metal siding panels manufactured by a third party. The subcontractor relied on installation instructions available on the manufacturer’s website, which did not specify the use of a splice plate to connect the panels. The panels were installed without splice plates, and after construction, the panels began to detach from the building, causing some to fall and damage nearby property. The contractor later discovered that the manufacturer had created an instruction sheet in 2006 recommending splice plates, but this information was not publicly available at the time of installation.The contractor initially sued the installer for breach of contract, warranty, and negligence in the Vermont Superior Court, Chittenden Unit, Civil Division. The complaint was later amended to add a product liability claim against the manufacturer. After further discovery, the contractor sought to amend the complaint a third time to add new claims against the manufacturer, arguing that new evidence justified the amendment. The trial court denied this motion, citing undue delay and prejudice to the manufacturer, and granted summary judgment to the manufacturer on the product liability claim and on a crossclaim for implied indemnity brought by the installer, finding both barred by the economic-loss rule.On appeal, the Vermont Supreme Court affirmed the trial court’s decisions. The Court held that the trial court did not abuse its discretion in denying the third motion to amend due to undue delay and prejudice. It also held that the economic-loss rule barred the contractor’s product liability claim, as neither the “other-property” nor “special-relationship” exceptions applied. Finally, the Court found the contractor lacked standing to appeal the summary judgment on the installer’s implied indemnity claim. View "PeakCM, LLC v. Mountainview Metal Systems, LLC" on Justia Law

An egg farm owned by Rembrandt Enterprises, Inc. experienced a collapse of its poultry cage system in 2020, resulting in significant damage and the death of a farm worker. Rembrandt had contracted with Tecno Poultry Equipment, SpA in 2006 to design and manufacture the cage system, which included a provision for Tecno to supervise its installation. The installation was completed in 2007. Rembrandt sued Tecno in 2021, alleging strict products liability, breach of implied warranties, and negligence. The district court allowed the negligence claim to proceed to trial, where a jury found that Tecno did not breach its duty to supervise the installation.The United States District Court for the Northern District of Iowa granted summary judgment for Tecno on the strict products liability and breach of implied warranties claims. At trial, the jury heard conflicting expert testimony regarding the cause of the collapse. Rembrandt's expert attributed the collapse to missing screws and misplaced bolts, while Tecno's experts blamed improper manure disposal by Rembrandt. The jury ultimately sided with Tecno, and the district court entered judgment in favor of Tecno.The United States Court of Appeals for the Eighth Circuit reviewed the case. Rembrandt argued that the district court erred in denying its motions for judgment as a matter of law and in excluding a screenshot of Tecno's website. The appellate court held that Rembrandt failed to preserve its challenge to the sufficiency of the evidence by not renewing its motion under Rule 50(b) after the jury verdict. The court also found that the district court did not abuse its discretion in excluding the website screenshot, as it was not relevant to the 2006 contract. The Eighth Circuit affirmed the district court's judgment. View "Rembrandt Enterprises, Inc. v. Tecno Poultry Equipment, SpA" on Justia Law