Stults et al v. International Flavors and Fragrances, Inc et al---SEE #274 AND #285 ORDERS AND #4, #111, #112, #124, #128, #289 DISMISSALS WHEN FINAL JUDGMENT ENTERED;
Filing
285
MEMORANDUM Opinion and Order granting 276 Motion to Reconsider 274 Order. Therefore, I reverse that part of my order granting summary judgment to defendants on the Stults implied warranty claims and Barbaras loss of consortium claim. This case will proceed to trial on Counts III and IV (See Order text for instructions to select a trial date). Signed by Judge Mark W Bennett on 2/25/2014. (des)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF IOWA
WESTERN DIVISION
DAVID STULTS
STULTS,
and
BARBARA
No. C11-4077-MWB
Plaintiffs,
vs.
BUSH BOAKE ALLEN, INC., and
INTERNATIONAL
FLAVORS
&
FRAGRANCES,
MEMORANDUM OPINION AND
ORDER REGARDING PLAINTIFFS’
MOTION TO RECONSIDER
Defendants.
___________________________
TABLE OF CONTENTS
I.
INTRODUCTION AND BACKGROUND .............................................. 2
II.
LEGAL ANALYSIS ........................................................................ 3
A.
Standards For Reconsideration .................................................. 3
B.
Waiver Issue ......................................................................... 4
C.
Reconsideration Of Summary Judgment Ruling ............................. 7
1.
Michigan statute of limitations .......................................... 7
2.
Review of summary judgment ruling ................................... 9
3.
Merger of claims ......................................................... 10
III.
CONCLUSION ............................................................................ 13
I.
INTRODUCTION AND BACKGROUND
On December 23, 2013, I granted defendant Bush Boake Allen, Inc. and
International Flavors & Fragrances Inc.’s (collectively, “defendants”) Joint Motion For
Partial Summary Judgment on Plaintiffs’ Strict Liability Claim and Joint Motion For
Partial Summary Judgment as to Couints II-IV Based on Michigan’s Three-Year Statute
Of Limitations. On that same day, judgment was entered dismissing all of plaintiffs
David Stults and Barbara Stults’s claims against the defendants.
In my summary
judgment order, I initially determined that the substantive legal issues were governed by
Michigan law. I then held that the Stults’ strict liability claim was not viable because
Michigan does not recognize a strict liability theory of recovery. I then went on to hold
that both the Stults’ negligence and breach of implied warranty claims were time barred.
Finally, I also granted summary judgment as to Barbara’s loss of consortium claim
because it was a derivative claim that could not survive without a viable cause of action
against defendants.
This case is before me on plaintiffs’ Motion For Reconsideration Of Memorandum
Opinion and Order Regarding Defendants’ Motion For Summary Judgment (docket no.
276). The Stults assert that, under Michigan law, a statutory discovery rule found in
Michigan Compiled Laws § 600.5833 applies to their implied warranty claims, and that
their implied warranty claims were timely filed under that statute. Because the Stults did
not raise this argument in their resistance to defendants’ motion for summary judgment,
I directed the Stults to file a supplemental brief addressing whether plaintiffs had waived
the issue. The Stults filed their supplemental brief on January 14, 2014. Defendants
filed their response to the Stults’ motion to reconsider and supplemental brief on January
28, 2014. The Stults filed their reply brief on February 4, 2014. I heard telephonic oral
arguments on the Stults’ motion on February 19, 2014.
2
II.
A.
LEGAL ANALYSIS
Standards For Reconsideration
I turn, first, to the questions of the authority and standards for reconsideration of
my conclusions in my Summary Judgment Ruling. Rule 59(e) provides that “[a] motion
to alter or amend a judgment must be filed no later than 28 days after the entry of the
judgment.” FED. R. CIV. P. 59(e). There is no dispute here that the Stults’ motion is
timely under this rule. The rule does not state any standards for granting or denying such
a motion, however.
The Eighth Circuit Court of Appeals has repeatedly explained the applicable
standards, as follows:
“A district court has broad discretion in determining whether
to grant or deny a motion to alter or amend judgment pursuant
to Rule 59(e). . . .” United States v. Metropolitan St. Louis
Sewer Dist., 440 F.3d 930, 933 (8th Cir. 2006). “Rule 59(e)
motions serve the limited function of correcting manifest
errors of law or fact. . . .” Id. (citation and internal quotation
marks omitted).
United States ex rel. Raynor v. National Rural Utilities Co-op. Fin. Corp., 690 F.3d 951,
958 (8th Cir. 2012); Wells Fargo Bank, N.A. v. WMR e-PIN, L.L.C., 653 F.3d 702, 714
(8th Cir. 2011) (motions pursuant to Rule 59(e) and Rule 60(b) “‘serve the limited
function of correcting manifest errors of law or fact or to present newly discovered
evidence’” (quoting Lowry v. Watson Chapel Sch. Dist., 540 F.3d 752, 761 (8th Cir.
2008)); Sipp v. Astrue, 641 F.3d 975, 980-81 (8th Cir. 2011) (“As the district court
explained, Rule 59(e)’s limited purpose is to allow the trial court to correct manifest
errors of law or fact. Johnson v. Chater, 108 F.3d 942, 945 n.3 (8th Cir. 1997). The
district court’s denial of such a motion is reviewed for a clear abuse of discretion.
Hagerman v. Yukon Energy Corp., 839 F.2d 407, 413–14 (8th Cir. 1988).”). Somewhat
more specifically, an abuse of discretion, within the scope of Rule 59(e), occurs “‘where
3
the district court fails to consider an important factor, gives significant weight to an
irrelevant or improper factor, or commits a clear error of judgment in weighing those
factors.’” Matthew v. Unum Life Ins. Co. of Am., 639 F.3d 857, 863 (8th Cir. 2011)
(quoting Kurka v. Iowa Cnty., IA, 628 F.3d 953, 957 (8th Cir. 2010)).
Various district courts have recognized that a Rule 59(e) motion to “reconsider”
may also be granted where the court overlooked a factual or legal argument presented by
a party, but not where a party failed to present a relevant factual or legal argument to the
court in the first instance. See, e.g., Tiffany (NJ), L.L.C. v. Forbse, No. 11 Civ. 4976
(NEB), 2012 WL 3686289, *5 & n.6 (S.D.N.Y. Aug. 23, 2012) (noting that Rule 59(e)
was inapplicable, because the motion was decided under Local Rule 6.3, but that the
standards for “reconsideration” were the same under the two rules, citing In re Fossamax
Prods. Liab. Litig., 815 F. Supp. 2d 649, 651 (S.D.N.Y. 2011)); United States v. Jasin,
292 F. Supp. 2d 670, 676 (E.D. Pa. 2003). I find that recognizing such an error as
cognizable on a Rule 59(e) motion is consistent with the sorts of abuse of discretion and
error that the Eighth Circuit Court of Appeals has found sufficient to warrant relief
pursuant to Rule 59(e). Specifically, doing so allows a district court the first opportunity
to remedy a “manifest” oversight, cf. Sipp, 641 F.3d at 980-81, and failure to consider
an argument of a party is at least as fundamental an error as failure to consider an
important factor in the determination of an issue. Cf. Matthew, 639 F.3d at 863.
B.
Waiver Issue
I next take up the question of whether the Stults waived the argument they raise in
their motion to reconsider. The Stults argue that waiver does not apply to their argument
because they had no obligation to raise application of § 600.5833 in the first place since
defendants had not argued in their motion for summary judgment that the Stults’ warranty
claims were barred by § 600.5833. Defendants respond that the Stults waived any
4
argument they might have regarding the relevance of § 600.5833 to defendants’ motion
for summary judgment by never so much as citing § 600.5833 in their resistance to
defendants’ motion for summary judgment.
A motion for reconsideration is not “the occasion to tender new legal theories for
the first time.” Hagerman, 839 F.2d at 414 (citation omitted). The Eighth Circuit Court
of Appeals has repeatedly held that “a party cannot assert arguments that were not
presented to the district court in opposing summary judgment in an appeal contesting an
adverse grant of summary judgment.” Cole v. Int'l Union, United Auto., Aerospace &
Agric. Implement Workers, 533 F.3d 932, 936 (8th Cir. 2008); see, e.g., Action Tapes,
Inc. v. Mattson, 462 F.3d 1010, 1014 (8th Cir. 2006); O.R.S. Distilling Co. v. Brown–
Forman Corp., 972 F.2d 924, 926 (8th Cir. 1992). This principle applies equally here.
Thus, in a motion to reconsider, a party may not rely on an argument that could have
been-but was not-presented to me before I entered my summary judgment order. This
principle requires me to briefly review the burdens arising from a summary judgment
motion.
“A movant for summary judgment bears the initial responsibility of informing the
court of the basis for the motion, and must identify those portions of the record which
the movant believes demonstrate the absence of a genuine issue of material fact.” Gannon
Intil, Ltd. v. Blocker, 684 F.3d 785, 792 (8th Cir. 2012); see Torgerson v. City of
Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (en banc). “If the movant does so, the
nonmovant must respond by submitting evidentiary materials that set out specific facts
showing that there is a genuine issue for trial.” Blocker, 684 F.3d at 792; see Torgerson,
643 F.3d at 1042. The Eleventh Circuit Court of Appeals has further observed that:
“When a party moves for final, not partial, summary judgment, we have stated that “it
[becomes] incumbent upon the [nonmovant] to respond by, at the very least, raising in
their opposition papers any and all arguments or defenses they felt precluded judgment
5
in [the moving party’s] favor.’” Case v. Eslinger, 555 F.3d 1317, 1329 (11th Cir. 2009)
(quoting Johnson v. Board of Regents, 263 F.3d 1234, 1264 (11th Cir. 2001)).
Here, defendants filed a Joint Motion For Partial Summary Judgment As To
Counts II-IV Based on Michigan’s Three-Year Statute Of Limitations. Defendants did
not identify any specific Michigan statute of limitations in the text of their motion for
summary judgment. In their accompanying brief, however, defendants stated that they
were seeking summary judgment based on Michigan Compiled Laws § 600.5827 and the
decision in Trentadue v. Buckler Automatic Lawn Sprinkler Co., 738 N.W.2d 664, 672
(Mich. 2007) (holding that there is no common law discovery rule for claims governed
by § 600.5827). Thus, defendants’ motion for summary judgment was focused on
application of § 600.5827 to the Stults’ claims. Defendants specifically argued that the
Stults’ negligence claims were barred by application of § 600.5827 and the Trentadue
decision. Defendants next argued that the Stults’ implied warranty claims should be
treated as “duplicative” of the Stults’ negligence claims and “thus, it cannot survive
summary judgment for the same reasons addressed immediately above.” Summary
Judgment Mot. at 13.
Thus, again, the focus of defendants’ motion for summary
judgment was on application of § 600.5827 and the Trentadue decision. Defendants did
not assert in their summary judgment motion that Michigan Compiled Laws § 600.5833,
which contains a discovery rule for breach of warranty claims, applied to any of the
Stults’ warranty claims, or argue that the Stults’ warranty claims were barred by
§ 600.5833. Defendants’ only reference to § 600.5833, and, indeed, the only reference
to § 600.5833 in any party’s brief, was in a nebulas footnote at the end of defendants’
opening brief stating:
In those circumstances where a personal injury breach of
warranty claim is independent from a negligent design claim,
see Prentis, 421 Mich. at 692 n.30, a statutory discovery rule
exists under Michigan law. M.C.L. § 600.5833 (“In actions
6
for damages based on breach of a warranty of quality or
fitness the claim accrues at the time the breach of the warranty
is discovered or reasonably should be discovered.”). Of
course, these circumstances are not present in this case.
Defendants’ Br. at 14 n.6.
Given defendants’ exclusive focus on § 600.5827, and the parties’ apparent
unspoken but shared assumption that the Stults’ warranty claims were timely under
§ 600.5833, the Stults understandably focused their response exclusively on § 600.5827
and defendants’ waiver theory. The better practice, however, would have been to provide
a thorough and extensive overview of Michigan’s statute of limitations law, including
application of § 600.5833’s discovery rule for breach of warranty claims, before
responding to the arguments advanced in defendants’ motion. This approach would have
avoided further confusion in an already complicated area of the law. Nonetheless, under
the unusual circumstances presented here, I conclude that the Stults have not waived the
argument they raise in their motion to reconsider.
C.
1.
Reconsideration Of Summary Judgment Ruling
Michigan statute of limitations
Under Michigan law, the statute of limitations in negligence and product liability
actions is three years. See MICH. COMP. LAWS §§ 600.5805(10), 600.5805(13).1 In
1
Michigan Compiled Law § 600.5805(10) provides:
Except as otherwise provided in this section, the period of
limitations is 3 years after the time of the death or injury for
all actions to recover damages for the death of a person, or
for injury to a person or property.
MICH. COMP. LAWS § 600.5805(10). Michigan Compiled Law § 600.5805(13), in turn,
states:
7
general, “the period of limitations runs from the time the claim accrues.” MICH. COMP.
LAWS § 600.5827. Historically, Michigan’s discovery rule governed the date of accrual
for certain types of actions. See Moll v. Abbott Labs., 506 N.W.2d 816 (Mich. 1993).
Under the discovery rule, the statute of limitations begins to run when the plaintiff
discovers or, through the exercise of reasonable diligence, should have discovered, an
injury and the causal connection between that injury and the defendant's breach of a duty.
Id. at 824; see Trentadue v. Buckler Automatic Lawn Sprinkler Co., 738 N.W.2d 664,
670 (Mich. 2007). The rationale for Michigan’s discovery rule is to avoid extinguishing
a cause of action before the plaintiff is even aware of the possible cause of action, due
the latent nature of a plaintiff's injury or an inability to discover the causal connection
between the injury and a defendant's breach. See Lemmerman v. Fealk, 534 N.W.2d
695, 698 (Mich. 1995).
Michigan’s discovery doctrine historically applied to the
determination of when a cause of action accrues for latent injuries in a product liability
action. See Moll, 506 N.W.2d at 669; Southgate Sch. Dist. v. West Side Constr. Co.,
247 N.W.2d 884, 888 (Mich. 1976).
As noted above, in Trentadue v. Buckler Automatic Lawn Sprinkler Co., 738
N.W.2d 664 (Mich. 2007), however, the Michigan Supreme Court held that Michigan's
limitations statute abrogated the common law discovery rule. Id. at 671–672. Although
the Michigan statute, MICH. COMP. LAWS § 600.5827, does not explicitly address the
common law discovery rule, the Michigan Supreme Court held that the Michigan
legislature intended to occupy the field by enacting the limitations statute. Id. at 671.
The period of limitations is 3 years for a products liability
action. However, in the case of a product that has been in use
for not less than 10 years, the plaintiff, in proving a prima
facie case, shall be required to do so without benefit of any
presumption.
Mich. Comp. Laws §§ 600.5805(13).
8
Thus, the court reasoned, “an extrastatutory discovery rule” would contravene legislative
intent. Id. at 672. The Trentadue court made clear that its holding was based on “the
language of the entire ‘statutory scheme’ governing statutes of limitations and particularly
the plain language of Mich. Comp. Law § 600.5827, which applies to both wrongful
death and products liability actions.” Peter v. Stryker Orthopaedics, Inc., 581 F. Supp.
2d 813, 817 (E.D. Mich. 2008) (citing Trentadue, 738 N.W.2d at 671–72) (footnote
omitted)).
2.
Review of summary judgment ruling
In my summary judgment ruling, I concluded that application of § 600.5827 and
Trentadue to this case required the conclusion that all of the Stults’ products liability
claims were time-barred. This analysis, however, has a flaw. Michigan Compiled Laws
§ 600.5833 tolls the accrual of the statute of limitations for breach of warranty claims
until the breach is discovered. See Cullender v. BASF Wyandotte Corp., 381 N.W.2d
737, 739-40 (Mich. Ct. App. 1985) (holding that breach of warranty claim did not accrue
until the plaintiff “either discovered or, through reasonable diligence, should have
discovered the he had a possible cause of action.”). Section 600.5833 states: “In actions
for damages based on breach of a warranty of quality or fitness the claim accrues at the
time the breach of the warranty is discovered or reasonably should be discovered.”
MICH. COMP. LAWS § 600.5833. Thus, under § 600.5833, the statute of limitations on
the Stults’ implied warranty claims did not begin to run until the Stults knew or should
have known that there was a causal connection between David’s alleged injuries and
defendants’ product. See Cullender, 381 N.W.2d at 739-40 David was not diagnosed
with bronchiolitis obliterans until 2009. Therefore, the Stults could not have reasonably
discovered that they had a possible cause of action until that time. The Stults filed their
Complaint on August 24, 2011. Thus, absent merger of the Stults’ negligence and breach
of warranty claims, the Stults’ breach of warranty claims were timely filed under the
9
statutory discovery rule in § 600.5833. Therefore, I must determine whether the Stults’
breach of implied warranty claims merged with their negligence claims.
3.
Merger of claims
In arguing that merger occurred, defendants rely on the Michigan Supreme Court’s
decision in Prentis v. Yale Manufacturing Co., 365 N.W.2d 176 (Mich. 1984). In
Prentis, the plaintiff sought damages for injuries suffered in an accident involving a handoperated forklift. Id. at 177. The plaintiff brought suit alleging both negligence and
breach of implied warranty claims. Id. The trial court refused to instruct the jury on
breach of warranty, but instructed on the theory of negligent design. The jury returned
“a verdict of no cause of action.” Id. at 178. The Michigan Court of Appeals reversed,
holding that the failure to give the plaintiff’s requested instruction was reversible error.
See Prentis v. Yale Mfg. Co., 323 N.W.2d 444, 446 (Mich. Ct. App. 1982). The
Michigan Supreme Court reversed the Michigan Court of Appeals and reinstated the trial
court's judgment. Prentis, 365 N.W.2d at 187. The court held that where a products
liability action against a manufacturer is based upon defective design, the jury need only
be instructed on a single unified theory of negligent design. Id. The court explained
that:
This holding is based upon the recognition that under
the common law of products liability, in an action against the
manufacturer of a product based upon an alleged defect in its
design, “breach of implied warranty and negligence involve
identical evidence and require proof of exactly the same
elements.”
Id. at 186. The court further reasoned that because the plaintiff's evidence at trial focused
on the single claim that the defendant “defectively designed” the forklift by failing to
provide a seat or platform for the operator, the factual inquiry and the legal inquiry were
indistinguishable and that “instructions on both would only confuse the jury.” Id. at 187.
10
Thus, in that context, the Michigan Supreme Court concluded that the trial court's refusal
to instruct on breach of warranty was not error. Id.
I conclude that the Prentis decision does not necessitate the merger of the Stults’
negligence and implied warranty claims pretrial. First, in Prentis, the Michigan Supreme
Court explicitly recognized that negligence and implied warranty claims remained two
separate and viable causes of action, stating “[w]e do not suggest that implied warranty
and negligence are not separate and distinct theories of recovery, or that the Michigan
products liability statute has merged all former products liability theories or causes of
action into a single unified ‘products liability theory.’” Prentis v. Yale Mtg. Co., 365
N.W.2d 176, 186 (1984) (citations and footnote omitted). This statement in Prentis
remains an accurate statement of Michigan law in light of the post–Prentis decisions of
Michigan courts continuing to recognize the viability of both implied warranty and
negligence theories of recovery under Michigan products liability law. For example, in
Bouverette v. Westinghouse Elec. Corp., 628 N.W.2d 86 (Mich. Ct. App. 2001), the
Michigan Court of Appeals flatly declared that “the theories of negligence and implied
warranty remain separate causes of action with different elements.” Id. at 90; see Kenkel
v. Stanley Works, 665 N.W.2d 490, 496 (Mich. Ct. App. 2003) (holding that plaintiff’s
concession that automated sliding glass doors were neither negligently designed nor
negligently manufactured was not fatal to her claim of breach of implied warranty against
manufacturer); see also Ludwig v. Dick Martin Sports, Inc., No. 242,758, 2003 WL
22736591, at *2 (Mich. Ct. App. Nov. 20, 2003) (“Negligence and breach of implied
warranty may involve the same elements and proofs in certain factual contexts underlying
a failure to warn, even though these two theories remain separate causes of action.”),
rev’d on other grounds, 680 N.W.2d 420 (Mich. 2004) (unpublished table decision).
If Prentis was a recent decision, defendants’ argument might have more traction.
Prentis, however, is a 30 year old decision and this body of law, developed in the interim,
11
has continued to recognize the viability of both implied warranty and negligence theories
under Michigan law. Moreover, several federal district courts have likewise concluded
that both implied warranty and negligence remain viable theories of recovery under
Michigan products liability law post-Prentis. See State Farm Fire & Cas. Co. v. Conair
Corp., 833 F. Supp.2d 713, 721-22 (E.D. Mich. 2011) (denying defendant's claim that
plaintiff's implied warranty and negligent design/negligent manufacture theories merged
under Michigan law); Norton v. Auto Club Group Ins. Co., No. 04–40376, 2009 WL
884129, at *15–*21 (E.D. Mich. Mar. 30, 2009) (rejecting defendant’s argument that
the elements of a breach of implied warranty claim and negligence-based product liability
claim had been merged under Michigan's products liability statute and concluding “that
plaintiff is not required to present evidence on all elements of a negligence products
liability claim to sustain its claim for breach of warranty under Michigan law.”); see also
Auto Club Group Ins. Co. v. All–Glass Aquarium Co., 716 F. Supp.2d 686, 689–90
(E.D. Mich. 2010) (noting that both negligence and implied warranty are separate viable
theories of recovery available under Michigan law, and the distinct elements required for
these two theories); Istvan v. Honda Motor Co., Ltd., No. 08-12507, 2010 WL 1254844,
at *5 (E.D. Mich. Mar. 25, 2010) (“Claims of breach of implied warranty and negligence
in manufacturing or design may require the same proofs in certain circumstances.
However, ‘the theories of negligence and implied warranty remain separate causes of
action with different elements.’”) (quoting Kenkel, 665 N.W.2d at 496) (internal
quotation marks omitted)); Citizens Ins. Co. v. Marubeni Citizen-Cinom, Inc.,No. 1: 05CV-476, 2006 WL 2972596, at *2 (W.D. Mich. Oct. 16, 2006) (recognizing that
“[a]lthough negligence and breach of implied warranty may, in certain factual contexts,
involve the same elements and proofs, the theories of negligence and implied warranty
remain separate causes of action with different elements.”). Thus, I conclude that the
Stults’ breach of implied warranty claims did not merge with their negligence claims and
12
I grant the Stults’ motion to reconsider. Therefore, I reverse that part of my December
24, 2013, order granting summary judgment to defendants on the Stults’ implied warranty
claims. Having reversed that part of my summary judgment order, I also reverse my
conclusion that Barbara’s derivative loss of consortium claim fails as a matter of law.
III.
CONCLUSION
For the reasons discussed above, I conclude that the Stults’ breach of implied
warranty claims did not merge with their negligence claims and I grant the Stults’ motion
to reconsider. Therefore, I reverse that part of my December 24, 2013, order granting
summary judgment to defendants on the Stults’ implied warranty claims and Barbara’s
loss of consortium claim. This case will proceed to trial on Counts III and IV. The
parties are to contact my legal assistant, Jennifer Gill, at jennifer_gill@iand.uscourts.gov,
to select a trial date.
IT IS SO ORDERED.
DATED this 25th day of February, 2014.
______________________________________
MARK W. BENNETT
U.S. DISTRICT COURT JUDGE
NORTHERN DISTRICT OF IOWA
13
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?