Herbst v. Bush Boake Allen Inc et al

Filing 220

ORDER denying in its entirety 144 Motion for Summary Judgment. See Order text for details. Signed by Judge Mark W Bennett on 12/21/2018. (mmc)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF IOWA
WESTERN DIVISION
MARLIN HERBST,
No. C 17-4008-MWB
Plaintiff,
vs.
GIVAUDAN FLAVORS
CORPORATION and EMORAL, INC.,
f/k/a Polarome International, Inc.,

OPINION AND ORDER
REGARDING DEFENDANT
EMORAL’S MOTION FOR
SUMMARY JUDGMENT

Defendants.
___________________________
TABLE OF CONTENTS
I. 

INTRODUCTION........................................................................... 2 

II. 

LEGAL ANALYSIS ........................................................................ 3 
A. 
Summary Judgment Standards ................................................... 3 
B. 
Analysis ............................................................................... 5 
1. 
The statute of repose ....................................................... 5 
2. 
Causation .................................................................... 6 
a. 
The “sophisticated user” defense ............................... 6 
b. 
Proof of exposure to Emoral’s diacetyl ........................ 8 
3. 
Mere distributor immunity .............................................. 10 

III. 

CONCLUSION ............................................................................ 14 

I.

INTRODUCTION

In this case, plaintiff Marlin Herbst alleges that he suffers from bronchiolitis
obliterans (aka “popcorn lung”) and/or other lung or respiratory diseases or impairments
from working with butter flavorings containing diacetyl at the American Popcorn
Company (APC) plant in Sioux City, Iowa, between 1991 and August 1993. On January
27, 2017, Herbst brought products liability claims under strict liability and negligence
and a claim of breach of implied warranties against various “manufacturing defendants,”
which are companies that allegedly designed, manufactured, distributed, and/or sold
diacetyl-containing butter flavorings to APC, and against various “diacetyl defendants,”
which are companies that allegedly designed, manufactured, marketed, distributed,
and/or sold diacetyl that was used by APC. The remaining “manufacturing defendant”
is Givaudan Flavors Corporation, and the remaining “diacetyl defendant” is Emoral, Inc.
Trial in this matter is set to begin on March 11, 2019.
This case is now before me on Emoral’s September 4, 2018, Motion For Summary
Judgment.1 After various extensions, Herbst filed his Resistance on December 7, 2018,
and Emoral filed its Reply on December 14, 2018. On December 19, 2018, Herbst
requested, and I granted, leave to file a sur-reply to respond to unanticipated arguments
in Emoral’s reply. I indicated that I would give the sur-reply whatever consideration I
deemed appropriate.

1

Emoral’s Motion is the last dispositive motion in this case. On February 9, 2018,
defendant Givaudan filed its First Motion For Summary Judgment on all of Herbst’s
claims on the ground that they are barred by the applicable 15-year statute of repose. I
denied Givaudan’s First Motion For Summary Judgment on September 20, 2018. On
September 4, 2018, Givaudan filed its Second Motion For Summary Judgment, as well
as three motions challenging experts. I denied all four of those motions on December 3,
2018.
2

Both parties request oral arguments on Emoral’s Motion, but I conclude that the
parties’ written arguments and supporting materials are sufficient. Therefore, Emoral’s
Motion is deemed fully submitted without oral arguments.
II.

LEGAL ANALYSIS

Emoral seeks summary judgment on all of Herbst’s claims on the following
grounds: (1) Herbst’s claims are barred by Iowa’s statute of repose; (2) Herbst cannot
establish causation for any of his claims against Emoral; and (3) as a mere distributor of
diacetyl, Emoral is not liable to Herbst under Iowa law on his claims of strict liability
and breach of warranties. Herbst denies that summary judgment is appropriate on any
of his claims. Before considering Emoral’s arguments, I will summarize the standards
for summary judgment.
A.

Summary Judgment Standards

Summary judgment is only appropriate when “the pleadings, depositions, answers
to interrogatories, and admissions on file, together with affidavits, if any, show that there
is no genuine issue of material fact and that the moving party is entitled to a judgment as
a matter of law.” FED. R. CIV. P. 56(c) (emphasis added); see Woods v. DaimlerChrysler
Corp., 409 F.3d 984, 990 (8th Cir. 2005) (“Summary judgment is appropriate if viewing
the record in the light most favorable to the nonmoving party, there are no genuine issues
of material fact and the moving party is entitled to judgment as a matter of law.”); see
generally Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). Thus, “[t]he movant
‘bears the initial responsibility of informing the district court of the basis for its motion,’
and must identify ‘those portions of [the record] . . . which it believes demonstrate the
absence of a genuine issue of material fact.’” Torgerson v. City of Rochester, 643 F.3d
1031, 1042 (8th Cir. 2011) (en banc) (quoting Celotex, 477 U.S. at 323). In response,
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“[t]he nonmovant ‘must do more than simply show that there is some metaphysical doubt
as to the material facts,’ and must come forward with ‘specific facts showing that there
is a genuine issue for trial.’” Id. (quoting Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586–87 (1986)).
When the parties have met their burdens, the district judge’s task is as follows:
“On a motion for summary judgment, ‘facts must be viewed
in the light most favorable to the nonmoving party only if
there is a genuine dispute as to those facts.’” Ricci v.
DeStefano, ––– U.S. ––––, 129 S. Ct. 2658, 2677, 174 L.
Ed. 2d 490 (2009) quoting Scott v. Harris, 550 U.S. 372,
380, 127 S. Ct. 1769, 167 L. Ed. 2d 686 (2007) (internal
quotations omitted). “Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences
from the facts are jury functions, not those of a judge.”
Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133,
150, 120 S. Ct. 2097, 147 L. Ed. 2d 105 (2000), quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.
Ct. 2505, 91 L. Ed. 2d 202 (1986). . . . . “‘Where the record
taken as a whole could not lead a rational trier of fact to find
for the nonmoving party, there is no genuine issue for trial.’”
Ricci, 129 S. Ct. at 2677, quoting Matsushita, 475 U.S. at
587, 106 S. Ct. 1348.
Torgerson, 643 F.3d at 1042-43.

Summary judgment is particularly appropriate,

however, when only questions of law are involved, rather than factual issues that may or
may not be subject to genuine dispute. See, e.g., Cremona v. R.S. Bacon Veneer Co.,
433 F.3d 617, 620 (8th Cir. 2006).
With these standards in mind, I turn to consideration of Emoral’s arguments for
summary judgment on all of Herbst’s claims.

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B.
1.

Analysis

The statute of repose

Emoral’s first argument for summary judgment is based on the 15-year statute of
repose for products cases under Iowa law, IOWA CODE § 614.1(2A)(a). Like Givaudan,
Emoral argues that Herbst’s claims, brought nearly 23 years after his employment at
APC ended, are barred by this statute of repose, which Emoral argues expired as to
Herbst’s claims in 2008. Emoral also contends that no exception to the expiration of the
statute of repose is applicable, here. Herbst argues that his claims are not barred, because
IOWA CODE § 614.1(2A)(a) expressly excepts claims from the statute of repose “if the
manufacturer, assembler, designer, supplier of specifications, seller, lessor, or distributor
of the product intentionally misrepresents facts about the product or fraudulently conceals
information about the product and that conduct was a substantial cause of the claimant’s
harm.” (Emphasis added). Herbst asserts that there are, at the very least, genuine issues
of material fact as to whether Emoral, like Givaudan, fraudulently concealed information
about the safety of diacetyl. In reply, Emoral argues that there are no triable issues of
fact on “fraudulent concealment,” because it was not the sole source of information about
diacetyl, where Givaudan and FONA, another flavorings manufacturer, had access to
sources of information regarding the hazards of diacetyl that extended far beyond the
information provided by Emoral, so Emoral could not conceal information its customers
already knew.
First, I conclude that, just as he did in response to Givaudan’s argument for
summary judgment on this issue, Herbst has met his burden at summary judgment to
identify evidence from which a rational trier of fact could conclude that Emoral concealed
information about the possible hazards of lung injuries from handling diacetyl.
Torgerson, 643 F.3d at 1042-43 (stating the rational trier of fact standard at summary
judgment). Next, I am not convinced, and Emoral has pointed to no authority holding,
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that evidence of Emoral’s concealment is irrelevant, because another entity purportedly
knew more and concealed more—not least because Emoral has not pointed to information
about diacetyl that Givaudan purportedly knew that Emoral did not or when and how
Emoral knew that Givaudan had more information than Emoral did. On the record
presented, a rational trier of fact could conclude that Emoral, like Givaudan, was
concealing information about the dangers of diacetyl so that manufacturers, like APC,
would continue to use diacetyl or products containing diacetyl, which would maintain the
demand for diacetyl. While a rational trier of fact might reject some of the evidence on
which Herbst relies to show knowledge and concealment by Emoral—for example, in
light of evidence that there may have been gaps in Emoral’s membership in FEMA—a
rational trier of fact would not be required to do so.
The part of Emoral’s Motion For Summary Judgment seeking summary judgment
on statute of repose grounds is denied.
2.

Causation

Emoral’s argument for summary judgment on Herbst’s inability to establish
causation has two prongs.
a.

The “sophisticated user” defense

First, Emoral argues that Herbst cannot establish “causation,” because of the
applicability of the “sophisticated user” defense. Specifically, Emoral argues that it was
under no duty to warn APC, or even Givaudan and FONA, of potential dangers of
diacetyl, because Givaudan and FONA were using diacetyl to formulate their flavorings
and were “sophisticated users” who then had the responsibility to warn APC and/or its
employees. Herbst argues that Emoral has not pointed to evidence demonstrating that
Givaudan was a “sophisticated user,” but merely assumes that it was, and that Emoral
misses the fact that the “sophisticated user” in the case on which it relies was the direct
employer of the injured worker, so that it was in a better position to warn its employees,
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which is not the case, here. Herbst also contends that there is evidence that Givaudan
relied on Emoral to provide information about health hazards of diacetyl. In reply,
Emoral reiterates that Givaudan was a “sophisticated user” and that Herbst is trying to
have it both ways, asserting that Givaudan fraudulently concealed information about
diacetyl, but then arguing that Givaudan was not a “sophisticated user.” Emoral also
argues that it is the degree of knowledge of the intermediate entity, not its position as an
employer of the injured person, that establishes the “sophisticated user” defense.
The parties have framed their arguments primarily in terms of the “sophisticated
user” defense discussed in Bergfield v. Unim Corp., 319 F.3d 350 (8th Cir. 2003), and
Mielke v. Ashland, Inc., No. 4:05-CV-88, 2007 WL 9711518 (S.D. Iowa Jan. 9, 2007),
which based the defense on Restatement (Second) Torts § 388(b). In Wright v. Brooke
Group, Ltd., 652 N.W.2d 159 (Iowa 2002), however, the Iowa Supreme Court adopted
the Restatement (Third) of Torts: Products Liability. See, e.g., Nationwide Agribusiness
Ins. Co. v. SMA Elevator Constr., Inc., 816 F. Supp. 2d 631, 653 (N.D. Iowa 2011)
(citing Scott v. Dutton-Lainson Co., 774 N.W.2d 501, 504 (Iowa 2009)). In Daughetee
v. Chr. Hansen, Inc., 960 F. Supp. 2d 849 (N.D. Iowa 2013), another “popcorn” case,
I reiterated my conclusion that, notwithstanding Iowa’s adoption of the Restatement
(Third),
the “intermediary” defense is still viable under Iowa law.
Specifically, I find that Restatement (Third) § 2(c) and
comment i recognize a defense to a warning defect claim
based on the duty of an intermediary—and not even
necessarily a “learned” or “sophisticated” intermediary—to
warn the end user. Section 2 expressly considers whether “the
foreseeable risks of harm posed by the product could have
been reduced or avoided by the provision of reasonable
instructions or warnings by the seller or other distributor, or
a predecessor in the commercial chain of distribution.”
7

Daughetee, 960 F. Supp. 2d at 870 (quoting Nationwide Agribusiness Ins. Co., 816 F.
Supp. 2d at 653–54, in turn quoting Restatement (Third) of Torts: Products Liability
§ 2(c) (emphasis added)).
Applying the Restatement (Third) standard to the parties’ arguments and evidence,
I conclude that, taking the facts in the light most favorable to Herbst as the non-moving
party, see Torgerson, 643 F.3d at 1042-43, a rational trier of fact could reject application
of Emoral’s “intermediary” defense. Specifically, a rational trier of fact could conclude
that Emoral’s diacetyl was not only dangerous if inhaled, but that Emoral knew it.
Moreover, a rational trier of fact could conclude that the likelihood that intermediaries,
like Givaudan, would convey that information either to APC or APC’s employees, was
greatly reduced or eliminated if Emoral, itself, withheld information concerning the
dangers posed by diacetyl from Givaudan and had no basis to believe that Givaudan knew
more about the dangers of diacetyl than Emoral did. Thus, a rational trier of fact could
conclude that Givaudan could not be relied on as a reasonable conduit for necessary
information about diacetyl, if Emoral was not first forthcoming to Givaudan about the
possible dangers of diacetyl.

A rational trier of fact could conclude, further, that

Givaudan might either be ignorant of the dangers of diacetyl or motivated to conceal them
from APC or its employees. See Daughetee, 960 F. Supp. 2d at 871 (considering these
factors in light of Restatement (Third) of Torts: Products Liability, § 2(c), cmt. i).
Thus, the part of Emoral’s Motion For Summary Judgment relying on the
“sophisticated user” or “intermediary defense” to defeat causation is denied.
b.

Proof of exposure to Emoral’s diacetyl

The second prong of Emoral’s “causation” argument for summary judgment is
that Herbst has failed to identify evidence that he was ever exposed to Emoral’s diacetyl
while employed at APC. Emoral argues that Herbst has shown only that its diacetyl was
in the chain of distribution, then relies on mere speculation that he was exposed to any
8

butter flavorings containing diacetyl distributed by Emoral and mere speculation that, but
for exposure to Emoral’s diacetyl, he would not have sustained his claimed injuries.
Herbst counters that he has pointed to abundant evidence that he was exposed to Emoral’s
diacetyl during his employment at APC and that that exposure caused his bronchiolitis
obliterans. In particular, he points to evidence that Emoral’s predecessor, Polarome, was
Givaudan’s main supplier of diacetyl—58,006 lbs. or 58% of the diacetyl used during
Herbst’s employment—and that FONA identified Polarome as the diacetyl supplier for
its butter flavorings—5,217 lbs. of which FONA sold to APC. He also recounts his
evidence of exposure to butter flavorings and the evidence identifying that exposure as
the cause of his lung injury. In reply, Emoral argues that Herbst is attempting to fill in
the “gaps” in his causation evidence with documents and exhibits filed under seal that he
has never before provided to Emoral, but which should have been disclosed to Emoral
during discovery. Emoral contends that Herbst must either be barred from relying on
this evidence or required to disclose it to Emoral immediately. What Herbst cannot be
allowed to do, Emoral argues, is sandbag Emoral. In his sur-reply, Herbst argues that
he has properly disclosed all of the evidence on the causation issue on which he now
relies, including in his appendix in support of his resistance and in prior discovery
responses.
It is true that a products liability plaintiff may not rely solely on speculation to
establish causation. See, e.g., Kleve v. General Motors Corp., 210 N.W.2d 568, 571
(Iowa 1973); see also Boddicker v. American Honda Motor Co., Inc., No. C10–1018,
2011 WL 5101912, at *12 (N.D. Iowa Oct. 25, 2011) (citing Kleve and O’Dell v. Ford
Motor Co., No. 4:06–CV–00523–CFB, 2008 WL 2880384 *9 (S.D. Iowa Jan. 9, 2008)).
Here, however, the evidence to which Herbst now points is sufficient that a rational trier
of fact could conclude that it is not merely possible that Herbst’s lung disease was caused
by Emoral’s diacetyl, but more probable than any other theory based on the evidence.
9

Id. Thus, the part of Emoral’s Motion For Summary Judgment relying on Herbst’s
purported failure to prove causation is denied.
On the other hand, Emoral is correct that Herbst cannot rely on evidence at trial
that was not properly disclosed during discovery. Assuming, without deciding, that there
may be some evidence on which Herbst relies in his resistance to Emoral’s Motion For
Summary Judgment that has not already been disclosed to Emoral, and recognizing
Herbst’s contention that all evidence has been properly disclosed, Herbst must promptly
disclose any previously undisclosed evidence.
3.

Mere distributor immunity

As its last ground for summary judgment, Emoral argues that it is entitled to
statutory immunity to Herbst’s strict liability and breach of warranty claims under IOWA
CODE § 613.18(1)(a), because it was merely a wholesale distributor of diacetyl who
simply passed the product along to a purchaser and lacked control over the design and
assembly of the product. Herbst disputes this contention, on the ground that Emoral was
an “assembler,” because it repackaged and relabeled the diacetyl with its own inadequate
warnings. He argues that all the justifications for holding “assemblers” liable apply in
this case. In reply, Emoral asserts that it is not an “assembler” that can be held liable,
because there is nothing but a “remarkable leap in logic” to suggest that Emoral’s mere
repackaging is the same as assembling a defective product in the way that a product and
its container were a single product in the case on which Herbst relies, particularly where
its package never injured anyone.
The statute in question provides as follows:
1. A person who is not the assembler, designer, or
manufacturer, and who wholesales, retails, distributes, or
otherwise sells a product is:
a. Immune from any suit based upon strict liability in tort or
breach of implied warranty of merchantability which arises
10

solely from an alleged defect in the original design or
manufacture of the product.
IOWA CODE § 613.18(1)(a). The parties properly focus on two cases interpreting this
provision.
In the first of those cases, Weyerhaeuser Co. v. Thermogas Co., 620 N.W.2d 819
(Iowa 2000), the Iowa Supreme Court considered the liability of a company that supplied
the plaintiff with fifteen LP tanks each day, specifically, by collecting empty tanks from
the plaintiff and replacing them with filled tanks. 620 N.W.2d at 822. The Iowa Supreme
Court explained, in part, “We think all of the justifications for the theory [of assembler
liability] prompted the legislature not to immunize from liability assemblers who
incorporate defective component parts into their finished product and then place that
product into the stream of commerce.” Id. at 826. In reaching that conclusion, the court
approved the theory that the container cannot logically be separated from its contents
when the two are sold as a unit, explaining,
One writer sees the rule as one of common sense:
The tide of decisions has swept away the highly
metaphysical distinction between the product and the
container in which it is sold, which used to perplex
some courts in the food cases. The two are sold as an
integrated whole, and it is inconceivable that anyone
would buy one without the other. When a bottle of beer
explodes and puts out the eye of the man about to drink
it, surely nothing should be less material than whether
the explosion is due to a flaw in the glass of the bottle
or to overcharged contents.
W. Page Keeton, et al., Prosser & Keeton on the Law of Torts
§ 99, at 694–95 (5th ed.1984) [hereinafter Prosser].
Weyerhaeuser Co., 620 N.W.2d at 826.

11

As to the merits in the case before it, the court in Weyerhaeuser concluded as
follows:
All the justifications for applying assembler liability to
Thermogas exist here. Thermogas derives an economic
benefit from the sale of a product that included a defective
component. Thermogas had the ability to test and inspect the
defective component when it was within its possession.
Thermogas also had the ability to exert pressure on the
manufacturer of the defective component to enhance the
component’s safety. Finally, by placing its product into the
stream of commerce, Thermogas represented to the consumer
and ultimate user—in this case, Weyerhaeuser—that the
component was safe. Conversely, Weyerhaeuser had a right
to expect that Thermogas would stand behind its product.
Weyerhaeuser Co., 620 N.W.2d at 827.
Subsequently, in Kolarik v. Cory Int’l Corp., 721 N.W.2d 159 (Iowa 2006), the
Iowa Supreme Court considered the liability as an “assembler” of a company that
removed bulk olives from drums and repackaged them in jars. 721 N.W.2d at 162. The
court concluded,
We are convinced that the assemblers’ exclusion
contained in section 613.18(1)(a) is aimed at those situations
in which an assembling process has some causal connection
to a dangerous condition in the product that gives rise to a
strict-liability claim or a product condition that constitutes a
breach of an implied warranty of merchantability. Because the
repackaging of the olives by defendants did not contribute to
the condition that underlies plaintiff’s product-liability claim,
defendants are afforded the immunity granted by the statute.
Kolarik, 721 N.W.2d at 162.
In light of Weyerhaeuser and Kolarik, I conclude that there are genuine issues of
material fact, at the very least, as to whether Emoral can be held liable as an “assembler”
12

under IOWA CODE § 613.18(1)(a). See Torgerson, 643 F.3d at 1042-43 (stating standards
for summary judgment). First, Herbst has pointed to evidence that Emoral did not simply
repackage the diacetyl, as in Kolarik. Rather, there is evidence that when Emoral
repackaged the diacetyl, it also relabeled it with its own allegedly inadequate warnings
and inadequate information, and it is the failure to provide adequate information about
the dangers of diacetyl that allegedly contributed to the condition that underlies Herbst’s
products aliability claims. Compare Kolarik, 721 N.W.2d at 162. Thus, unlike the
defendant in Kolarik, there are genuine issues of material fact as to whether Emoral is
entitled to statutory immunity.
Furthermore, there is evidence that the justifications for applying “assembler”
liability identified in Weyerhaeuser, 620 N.W.2d at 827, exist here. Herbst has pointed
to evidence that Emoral derives an economic benefit from the sale of a product that
included a defective component, the diacetyl packaged with inadequate warnings; that
Emoral had the ability to test and inspect the diacetyl and, most importantly, to provide
adequate safety information about it; that Emoral had the ability to exert pressure on
flavorings makers to enhance the safety of diacetyl by providing adequate warnings and
information; that by placing the diacetyl into the stream of commerce, Emoral represented
to both flavorings makers, such as Givaudan, and flavorings users, such as APC and its
employees, that the diacetyl was safe with the warnings and information provided; and
that Givaudan and APC had a right to expect that Emoral would stand behind its product
and the warnings and information about it that Emoral provided. See Weyerhaeuser Co.,
620 N.W.2d at 827.
Consequently, the part of Emoral’s Motion For Summary Judgment asserting
“distributor” immunity to Herbst’s strict liability and warranty claims under IOWA CODE
§ 613.18(1)(a) is denied.

13

III.

CONCLUSION

Upon the foregoing, Emoral’s September 4, 2018, Motion For Summary Judgment
(docket no. 144) is denied in its entirety.
IT IS SO ORDERED.
DATED this 21st day of December, 2018.

______________________________________
MARK W. BENNETT
U.S. DISTRICT COURT JUDGE
NORTHERN DISTRICT OF IOWA

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