Sisk v. Abbott Laboratories

Filing 163

ORDER denying 156 Defendant's Motion for Reconsideration. Signed by District Judge Martin Reidinger on 02/10/2014. (thh)

THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF NORTH CAROLINA
ASHEVILLE DIVISION
CIVIL CASE NO. 1:11-cv-00159-MR-DLH

KIMBERLY S. SISK, individually and )
as mother, natural guardian and
)
Guardian ad Litem of S.A.S., a minor, )
)
Plaintiff,
)
)
vs.
)
)
)
ABBOTT LABORATORIES, an
)
Illinois corporation,
)
)
Defendant.
)
_______________________________ )

ORDER

THIS MATTER is before the Court on the Defendant’s Motion for
Reconsideration [Doc. 156].
I.

PROCEDURAL BACKGROUND
On November 21, 2013, the parties appeared before the Court for a

hearing on the Defendant’s motion for summary judgment.

The

Defendant’s motion was based in part on Section 99B-10 of the North
Carolina Products Liability Act, which provides that “any person . . . who
donates an item of food for use or distribution by a nonprofit organization or
nonprofit corporation shall not be liable for civil damages . . . resulting from

the nature, age, condition, or packaging of the donated food, unless an
injury is caused by the gross negligence, recklessness, or intentional
misconduct of the donor.” N.C. Gen. Stat. § 99B-10(a).
The Court denied the Defendant’s motion in part and granted it in part
from the bench and in a minute order. Specifically with respect to the
Defendant’s Section 99B-10 argument, the Court stated that given “the
forecast of [the] evidence in the light most favorable to the plaintiff . . . a
jury could determine that the delivery of the formula to the hospital did not
constitute a donation under the statute and that that is a factual
determination.” [Doc. 157-1 at 95].
The Defendant now moves the Court pursuant to Rule 54(b) to
reconsider its finding that what constitutes a “donation” under Section 99B10 is a factual determination that should be left to the jury. Instead, the
Defendant urges the Court to rule as a matter of law that the Defendant’s
provision of powdered infant formula (PIF) to Transylvania Community
Hospital at no cost constituted a donation under the statute such that the
Defendant is entitled to summary judgment on all claims related to PIF
received by the Plaintiff from the hospital. [Doc. 156].
The Plaintiff opposes the Defendant’s motion, arguing that a question
of fact is presented as to whether the Defendant received consideration for
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the PIF it provided to the hospital. Alternatively, the Plaintiff renews her
argument that the Defendant has waived the affirmative defense of N.C.
Gen. Stat. § 99B-10 by failing to plead the defense in a timely manner.
[Doc. 159].
II.

STANDARD OF REVIEW
Rule 54(b) of the Federal Rules of Civil Procedure provides that, in

the absence of an express order directing final judgment as to certain
claims or parties:
[A]ny order or other decision, however designated,
that adjudicates fewer than all of the claims or the
rights and liabilities of fewer than all the parties
does not end the action as to any of the claims or
parties and may be revised at any time before the
entry of a judgment adjudicating all the claims and
all the parties’ rights and liabilities.
Fed. R. Civ. P. 54(b). Pursuant to this rule, the Court “retains the power to
reconsider and modify its interlocutory judgments, including partial
summary judgments, at any time prior to final judgment when such is
warranted.” Am. Canoe Ass’n v. Murphy Farms, Inc., 326 F.3d 505, 514-15
(4th Cir. 2003).

The decision to grant or deny a Rule 54(b) motion is

“committed to the discretion of the district court.” Id. at 515.

A prior

dispositive order should be followed unless “(1) a subsequent trial produces

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substantially different evidence, (2) controlling authority has since made a
contrary decision of law applicable to the issue, or (3) the prior decision
was clearly erroneous and would work manifest injustice.”

Id. (internal

quotations omitted).
III.

ANALYSIS
At the summary judgment hearing, the Court stated that the record

presented a forecast of evidence from which a jury could determine that the
delivery of the formula to the hospital did not constitute a donation under
the statute and thus denied summary judgment to the Defendant on the
basis of a Section 99B-10 defense. After further consideration and review,
the Court concludes that its decision to deny the Defendant’s motion for
summary judgment with respect to the Section 99B-10 defense was
correct, but that the reasoning underlying that decision may have been
erroneous.

For the reasons that follow, the Court concludes that the

Defendant is waived from presenting this affirmative defense in the case at
bar.
A defendant bears the burden of affirmatively pleading an affirmative
defense. See Fed. R. Civ. P. 8(c)(1); Eriline Co. S.A. v. Johnson, 440 F.3d
648, 653 (4th Cir. 2006).

Generally, the “failure to plead an affirmative

defense as required by Federal Rule 8(c) results in the waiver of that
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defense and its exclusion from the case....” Suntrust Mortg., Inc. v. United
Guar. Residential Ins. Co. of N.C., 508 F. App’x 243, 252 (4th Cir. 2013)
(quoting 5 Charles Alan Wright and Arthur R. Miller, Fed. Prac. & Proc. Civ.
§ 1278 (3d ed. 2012)). “Such waiver, however, should not be effective
unless the failure to plead resulted in unfair surprise or prejudice.”

S.

Wallace Edwards & Sons, Inc. v. Cincinnati Ins. Co., 353 F.3d 367, 373 (4th
Cir. 2003).
Here, the Defendant asserted twenty-four separate affirmative
defenses in its Answer to the Plaintiff’s Amended Complaint, including
specific citations to various provisions of the North Carolina Products
Liability Act. [See Doc. 91 at 10 (asserting defenses under N.C. Gen. Stat.
§ 99B-4(1) (Twenty-Second Defense); N.C. Gen. Stat. § 99B-4(3) (TwentyThird Defense); and N.C. Gen. Stat. § 99B-5(b) (Twenty-Fourth Defense)].
The Defendant, however, did not specifically assert Section 99B-10(a) in its
affirmative defenses.
The Defendant contends that it sufficiently invoked Section 99B-10(a)
in its Answer to the Amended Complaint by “adopt[ing] and incorporate[ing]
by reference any and all defenses that are or may become available to it
under the North Carolina Product Liability Act, including but not limited to
any defenses under N.C. Gen. Stat. § 99B et seq.” [Doc. 91 at 6 (Second
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Defense)]. The assertion of “any and all defenses that are or may become
available” is such a vague, generalized statement of what may or may not
be relied upon that it fails to provide any meaningful notice to the Plaintiff of
the specific affirmative defenses the Defendant intends to assert.

The

assertion of this “defense,” therefore, did not sufficiently invoke Section
99B-10(a) such that it could be considered to have been pled as an
affirmative defense.
Having determined that the Defendant failed to plead this affirmative
defense in its Answer, the Court now considers whether the Defendant’s
failure to plead this defense resulted in any unfair surprise or prejudice to
the Plaintiff. The Court finds that it did. Because Section 99B-10 was not
affirmatively pled as a possible defense in this action, the parties did not
engage in any substantial discovery on the issue. It was not until the filing
of the Defendant’s Motion for Summary Judgment that the Plaintiff received
any indication that the Defendant intended to rely on this statutory provision
at all. By the time that the summary judgment motion was filed, discovery
had long since closed, thus foreclosing any opportunity for the Plaintiff to
engage in discovery on the issue of the Defendant’s donation of PIF to the
hospital. “To permit defendants to inject this defense would necessitate reopening discovery at this late date just before trial, and would afford little
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time to plaintiff to prepare for this new and unanticipated theory of defense
which has not been previously developed through discovery.” Resolution
Trust Corp. v. Southwest Dev. Co., 807 F. Supp. 375, 379 (E.D.N.C. 1992),
rev’d on other grounds, Resolution Trust Corp. v. Cunningham, No. 931303, 1993 WL 542182 (4th Cir. Dec. 22, 1993).
The Defendant contends that the Plaintiff was not prejudiced by the
late disclosure of this defense because the issue already had been raised
in the prior state court action brought by the Plaintiff against the Defendant
and Transylvania Community Hospital. In that action, however, it was the
hospital, not Abbott Laboratories, which asserted Section 99B-10(a) as an
affirmative defense. The hospital’s assertion of the defense in an entirely
different action, therefore, did little to place the Plaintiff on notice that the
defense would be asserted by Abbott Laboratories in the present action.
For these reasons, the Court concludes that the Defendant has
waived any reliance on N.C. Gen. Stat. § 99B-10 as an affirmative defense
to the Plaintiff’s claims.

Accordingly, the Court affirms its prior ruling

denying the Defendant’s motion for summary judgment with respect to this
issue.

The Court further concludes, however, for the reasons stated

herein, that the Defendant should be precluded from asserting this defense
at trial.
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IT IS, THEREFORE, ORDERED that the Defendant’s Motion for
Reconsideration [Doc. 159] is DENIED.
IT IS SO ORDERED.

Signed: February 10, 2014

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