Long v. Smithfield Packaged Meats Corp.

Filing 83

OPINION and ORDER denying 59 Motion for Summary Judgment; denying 63 Motion for Partial Summary Judgment. Signed by Chief Judge Roberto A. Lange on 06/03/2024. (KLE)

UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
SOUTHERN DIVISION

ADAM Z. LONG,

4:22-CV-04024-RAL

Plaintiff,
vs.

OPINION AND ORDER DENYING

SMITHFIELD PACKAGED MEATS CORP.,

MOTIONS FOR SUMMARY JUDGMENT

Defendant/Third-Party Plaintiff
vs.

ZEE
COMPANY,
TRANSPORT,L.L.C.

E4C.,

and

L&B

Third-Party Defendants

Plaintiff Adam Z. Long, a driver for United Parcel Service ("UPS"), alleges that he was

injured when he was delivering packages to defendant/third-party plaintiff Smithfield Packaged
Meats Corp.("Smithfield")and came into contact with a caustic cleaning product known as Liquid
Smokehouse Cleaner ("LSC"). Doc. 1. Long sought compensatory damages and, in June 2023,

moved to amend the Complaint to allege grounds for punitive damages; this Court granted the
motion to amend. See Doc. 33 (motion to amend); Doe. 47 (order granting motion to amend);

Doc. 49 (First Amended Complaint). Smithfield filed a third-party complaint against third-party
defendants Zee Company, Inc.("Zee"), and L&B Transport, L.L.C.("L&B"), alleging a right to
indemnification or contribution. Doc. 16. Zee manufactured the LSC, and L&B delivered the
LSC to Smithfield. Id.

1

Smithfield now moves for partial summary judgment on Long's elaim for punitive
damages, Doc. 63, and L&B moves for summary judgment on Smithfield's claims for indemnity
and contribution. Doc. 59. Smithfield and Zee oppose L&B's motion for summary judgment.
Does. 70, 74.

1.

Undisputed Material Facts and Facts Viewed in Favor of Nonmoving Parties

Smithfield has a pork processing plant in Sioux Falls, South Dakota. Doe.63 at 2. As part

of its operations, Smithfield stores and uses the chemical LSC, a "caustic soda" of sodium
hydroxide, to clean its food processing equipment. Doc.
|
49 8. LSC is a level 3, corrosive

chemical^ that should only be handled with the use of personal protective equipment. Doc. 49
9, 19. Smithfield stores its LSC in a 3,500-gallon tank in a white concrete building known as

Building 127. Doe.49

11,16. Building 127 has labels on the exterior of its door,including the

NFPA 704 hazard diamond; a sign that says,"WARNING CAUSTIC SODA"; and a sign that

says, "AUTHORIZED PERSONNEL ONLY." Doc. 34-10; Doe. 34-30 at 16-17. Inside the
building is a caution sign that warns of caustic soda and instructs to "avoid skin or eye contact,"
"avoid inhalation or ingestion,""wear protective clothing," and to wash skin or eyes "with water
for 15 minutes" after any contact with the chemical. Doe. 34-9. The door to Building 127 remains
locked throughout the day,and only certain managers and security have keys to the building. Doe.
67-7 at 10-11.

On the evening of October 19, 2020, Glenn Westlake, an employee of L&B, arrived at

Smithfield's plant to deliver LSC to Building 127. Doe. 61-2 at 3. There was no manager at the

'These characteristics refer to the chemical's classification under the National Fire Protection

Association hazard diamond, or NFPA 704. LSC's health hazard category on the zero-to-four
scale is a three, meaning "extreme danger." Doe. 34-30 at 17. The NFPA 704 also classifies the
chemical as "corrosive," which is indicated by the "COR" on the diamond. Doe. 34-30 at 17.

plant at the time, so Westlake had to wait until the next day before pumping the LSC into the tank.
Doc. 61-2 at 3-4. A manager arrived in the morning and approved the delivery, and Westlake
began pumping LSC into Smithfield's tank in Building 127 through an external pipe attachment.
Doc. 61-2 at 5. From outside Building 127, he heard the chemical splashing onto the floor. Doc.

61-2 at 5. He immediately stopped pumping the LSC,checked inside the building, and noted that
the LSC had foamed out of the tank. Doc. 61-2 at 5. Westlake had not expected the chemical to
foam because nothing on the federally-required safety data sheet ("SDS") warned him that the

chemical was prone to foaming or that it required low-pressure pumping to avoid foaming.^ Doc.
61-2 at 5, 7; 29 C.F.R. § 1910.1200(g)(requiring chemical manufacturers and importers to "obtain

or develop a[n SDS] for each hazardous chemical they produce or import," provide an SDS to

distributors and employers with certain shipments, and include certain chemical information in the
SDS).

Westlake testified that he contacted someone at the plant about the spillage, and that

individual, who Westlake believes was a supervisor, told Westlake to continue pumping the LSC
and that chemical overflow was a regular occurrence. Doc. 61-2 at 5. No party can identify the

supervisor or employee who supposedly instructed Westlake to finish making the LSC delivery.^

^ Westlake testified that he received and reviewed the SDS for his delivery at Smithfield. Doc.

61-2 at 4-6. However, Zee challenges this point, arguing that an affidavit from David Tolleson,

the Manager - Freight Logistics of Kenco Transportation Management, LLC and the broker who
organized L&B's deliveries to Smithfield, contradicts Westlake's claim that he received an SDS
to review. Doc. 73 at 1-2.

^ Costa Mpunga's deposition testimony partially corroborates Westlake's account ofthe events on
October 19-20, 2020, by confirming that a manager did arrive and authorize Westlake to begin

pumping the LSC into the tank in Building 127. Doc. 80-2 at 4. Mpunga could not identify the
manager who authorized the delivery, and there is no additional testimony from anyone other than
Westlake himself that he spoke to that same manager after the LSC foamed out ofthe tank. Doc.
80-2 at 4; see also Doc. 61-1 at 1 (Smithfield's interrogatory response explaining that "Westlake
contends he communicated with an unnamed supervisor, but Defendant has not been able to locate
any such person despite its good faith efforts to do so").

After receiving these assurances, Westlake finished pumping the LSC into the tank at a lower
pressure to avoid additional foaming. Doc. 61-2 at 6. He did not make any report to any
governmental entity regarding the overflow. Doc. 61-2 at 9.
Later that same morning, Plaintiff Adam Long arrived at the Smithfield plant to make

deliveries to Building 98, |
Doc. 49 5, which is separated from Building 127 by an "alley," Doc.
34-24 at 12; Doc. 65 at 3. Under Smithfield's COVID-19 policies. Long made his deliveries to

Building 98 by unloading the delivery onto a pallet that sat in the alley between Buildings 98 and
127. Doc. 34-24 at 12. That morning, the pallet was leaning against the wall of Building 127,

under a vent. Doc. 49 ^ 11. LSC from Building 127 had leaked from the tank and through the
building's vents, down the exterior wall, and onto the pallet. Doc. 49 f 11. When Long grabbed

the pallet, the LSC on it burned his hands, making them feel "cold" and "numb." Doc. 49

11-

12; Doc. 34-24 at 17.

Long told Smithfield employees in Building 98 about the sensation he was experiencing

and a "slimy" substance on his hands. Doc. 34-24 at 17. They brought him inside and instructed
him to wash his hands for approximately ten to fifteen minutes, after which they directed Long to
the medical facility at the plant for ftirther assistance. Doe. 34-24 at 17-18. Long met Tammy

Tjaden at the medical facility and washed his hands again. Doc. 34-31 at 4. Tjaden contacted Ken
Winter, the Director of Safety and Health at Smithfield, about the incident and explained to Long
his chemical exposure. Doc. 34-30 at 6,19; Doc. 34-31 at 4,6.
There is various, and somewhat contradictory, deposition testimony regarding Smithfield

and its employees' knowledge regarding Building 127's LSC tank, its tendeney to leak LSC, and

the possibility for the chemical to escape Building 127 before and on the day of Long's injuries.
Compare Doc. 34-26 at 7 (Victor Hernandez explaining that he had "never seen" foam escape

Building 127 and was unaware that could happen); Doc. 34-27 at 10 (Ronnie Johnson stating he
had "never seen [the LSC]foam up"); Doc. 34-30 at 21,(Ken Winter noting that he could not say

whether foam had previously leaked out of Building 127 "from [his] own knowledge"); Doc. 662 at 5 (Choy Sayasavanh saying he had "only seen [the tank foam over] once"); Doc. 66-4 at 5

(Mike Johnson testifying he had never seen LSC escape Building 127 and that no one reported
such a leak to him); Doc. 61-1 at 1 (Smithfield's interrogatory response explaining that"Westlake
contends he communicated with an uimamed supervisor [on October 20, 2020], but Defendant has
not been able to locate any such person despite its good faith efforts to do so"), with Doc. 67-2 at

1 (report from Samuel Kaschke to Mike Corbett, Mike Johnson, Choy Sayasavanh, Tony Liles,
and Brian Roberts mentioning a leak, LSC "run[ning] down the . . . tank," and "a heavy buildup

of dry [LSC]around the pipe cormections"); Doc. 34-25 at 5, 8(Bobby Conner explaining that he
had seen foam escaping Building 127 "once in a while if [the deliverers] overfilled it," that he

"would get ahold of safety, or [he] would tell [his] supervisor" when that happened, and that he
"assumed"the paint and cinder block corrosion under the vent was from the chemical leaking out);
Doc. 34-28 at 6 (Costa Mpunga saying that he had seen chemical or foam escape Building 127
twice,that he reported it, and that Safety Director Ken Winter and "other managers ... came over

and survey[ed] the place" of the leak); Doc. 80-2 at 4(Mpunga noting that a manager authorized
Westlake to pump the chemical but uncertain who the manager was); Doc. 67-7 at 7, 10 (Choy
Sayasavanh noting he had seen "lines of stain" under the vent).

Long now sues Smithfield for premises liability and seeks, among other relief, punitive
damages. Smithfield seeks indemnity under its Third-Party Complaint from Zee and L&B.
II.

Standard of Review

Under Federal Rule of Civil Procedure 56, a motion for partial or complete summary
judgment should be granted "ifthe movant shows that there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter oflaw." Fed. R. Civ. P. 56(a). "A factual
dispute is 'genuine' if'a reasonable jury could return a verdict for the nonmoving party.'" Libertv
Ins. Corp. V. HNTB Corp.. 87 F.4th 886, 888 (8th Cir. 2023)(per curiam)(quoting Anderson v.
Libertv Lobbv, Inc.. 477 U.S. 242, 248 (1986)). Rule 56(a) places the burden initially on the

moving party to establish the absence of a genuine issue of material fact and entitlement to
judgment as a matter oflaw. Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett,477 U.S. 317,
322-23 (1986). Once the moving party has met that burden, the nonmoving party must establish
that a material fact is genuinely disputed either by "citing to particular parts of materials in the
record" or by "showing that the materials cited do not establish the absence . .. of a genuine

dispute." Fed. R. Civ. P. 56(c)(1)(A),(B); Gacek v. Owens & Minor Distrib.. Inc.,666 F.3d 1142,
1145-46 (8th Cir. 2012); see also Moslev v. Citv of Northwoods. 415 F.3d 908, 910 (8th Cir.
2005)(stating that a nonmovant may not merely rely on allegations or denials). The court views
the facts genuinely disputed in a light most favorable to the nonmoving party when ruling on a
motion for summary judgment. KOKO Dev.. LLC v. Phillips & Jordan. Inc.. No. 23-2234, 2024
WL 2005147, at *2(8th Cir. May 7,2024).
III.

Smithfield's Motion for Partial Summary Judgment

Smithfield moves for partial summary judgment on Long's claim for pimitive damages.
Doc. 63. South Dakota law governs the substantive issues in this diversity-ofrcitizenship-

jurisdiction case. Bores v. Domino's Pizza. LLC. 530 F.3d 671,674 (8th Cir. 2008)(citing Erie
R.R. Co. V. Tnmpkins. 304 U.S. 64, 78 (1938)). Under South Dakota law, punitive damages are

not recoverable unless expressly authorized by statute. SDCL § 21-1-4. The statute that authorizes
punitive damages in tort actions provides the following:
In any action for the breach of an obligation not arising from
contract, where the defendant has been guilty of oppression, fraud,
or maliee, actual or presumed, or in any case of wrongful injury to
animals, being subjects of property, committed intentionally or by
willful and wanton misconduct, in disregard of humanity, the jury,
in addition to the actual damage, may give damages for the sake of
example, and by way of punishing the defendant.

SDCL § 21-3-2. This statute clearly limits its applicability to tort cases involving "oppression,
fraud, or malice." See also Smizer v. Drev. 873 N.W.2d 697, 703 (S.D. 2016) (stating that

"[mjalice is an essential element of a claim for punitive damages" (cleaned up and citation
omitted)); Dahl v. Sittner. 474 N.W.2d 897,900(S.D. 1991)(same).

South Dakota law erects a procedural hurdle in SDCL §21-1-4.1 before a claim for punitive
damages can be presented to the jury. The statute provides

In any claim alleging punitive or exemplary damages, before any discovery relating thereto
may be commenced and before any such claim may be submitted to the finder of fact, the
court shall find, after a hearing and based upon clear and convincing evidence, that there
is a reasonable basis to believe that there has been willful, wanton or malicious conduct on

the part ofthe party claimed against.

SDCL § 21-1-4.1. SDCL § 21-l-4.rs procedural component—a hearing requirement before

allowing discovery on a punitive damage claim-—does not apply in federal court as federal
procedural rules govern. See Ammann v. Massev-Ferguson. Ltd.. 933 F. Supp. 840, 842-43

(D.S.D. 1996). However, SDCL § 21-1-4.1 also has a substantive law component of"clear and
convincing evidence" of a "reasonable basis to believe [the defendant engaged in] willful, wanton
or malicious conduct," and that substantive component must be applied in this diversity case. See
Esninozav. Fowler. 4:22-CV-04068-RAL,2023 U.S. Dist. LEXIS 163306, at *6-7(D.S.D. Sept.

12,2023)(citing Ammann.933 F. Supp. at 843). Thus,this Court has previously required that for

7

a punitive damages claim to survive a motion for summary judgment,the plaintiff must satisfy the
standard in SDCL § 21-1-4.1 by showing by clear and convincing evidence that a reasonable basis
exists upon which a jury could find the existence of malice.

Dziadek v. Charter Oak Fire Ins.

Co.. 4:11-CV-04134-RAL, 2015 WL 7760193, at *11-12(D.S.D. Dee. 1, 2015k see also Straub

V. Flevares. 4:13-CV-04120-KES, 2016 WL 1452363, at *2 (D.S.D. Apr. 13, 2016); Sehrant v.
Flevares. No. 4:12-CV-04180-KES,2014 WL 7240090, at *2(D.S.D. Dee. 19, 2014); Winterhoer
V. Edgewood Sioux Falls Senior Living. LLC. No. 4:12-CV-04049-KES, 2014 WL 28863, at *2

(D.S.D. Jan. 2, 2014).

Malice under South Dakota law can be actual or presumed, Smizer, 873 N.W.2d at 703,
and SDCL § 21-1-4.1 only requires demonstrating one, Dahl. 474 N.W.2d at 901. "The statute

does not require evidence of actual malice before any punitive damages issue can be submitted to
the fact finder. The statute may be satisfied by establishing presumed malice . . . or actual

malice ...." Id.; see also Fluth v. Sehoenfelder Constr.. Inc.. 917 N.W.2d 524,534(S.D. 2018).
Actual malice is "a positive state of mind, evidenced by the positive desire and intention

to injure another, actuated by hatred or ill-will toward that person." Dahl. 474 N.W.2d at 900.
There is no evidence here of any actual malice on the part of Smithfield.

Presumed malice, on the other hand, does not mean action motivated by hatred or ill-will,

but requires that an individual acts "willfully or wantonly to the injury of another." Id The

Supreme Court of South Dakota has clarified, however,that malice is not presumed from "simply
the doing ofan unlawful or injurious act." Id (citation omitted). Rather, malice is presumed from
acts that are "conceived in the spirit of mischief or of criminal indifference to civil obligations."

Id (citation omitted). "There must be facts that would show that defendant intentionally did
something . . . [and] it can be said that he consciously realized that his conduct would in all

8

probability, as distinguished from possibility, produce the preeise result which it did produce and
would bring harm to the plaintiff." Berry v. Risdall. 576 N.W.2d 1, 9 (S.D. 1998) (citation
omitted); Floekhart v. Wvant 467 N.W.2d 473, 478 (S.D. 1991). Further, presumed malice is
"conduct which partakes to some appreciable extent, though not entirely, of the nature of a
deliberate and intentional wrong." Berry. 576 N.W.2d at 9 (citation omitted); Floekhart. 467
N.W.2d at 478. In other words,"[t]he conduct must be more than mere mistake, inadyertenee, or
inattention." Gabriel y. Bauman. 847 N.W.2d 537, 543 (S.D. 2014); see also Vilhauer y.

Horsemens' Sports. Inc.. 598 N.W.2d 525, 529 (S.D. 1999)(emphasizing that punitiye damages
cannot be reeoyered for mere negligence).

In determining whether a corporate entity has acted with malice through the conduct of its

employees. South Dakota has adopted the complicity test from the Restatement. S^ Dahl. 474
N.W.2d at 903("We belieye the complicity rule to be the better approach, and adopt the rule of
the Restatement as the standard as to when punitiye damages may be awarded against a principal
for acts of his or her agent."). The complicity rule requires the principal haye some knowledge

before imposing liability, and only applies liability on a principal for the actions ofan agent in the
following circumstances:

(a) the principal or a managerial agent authorized the doing and the manner ofthe act, or
(b) the agent was unfit and the principal or a managerial agent was reckless in employing
or retaining him, or

(e) the agent was employed in a managerial capacity and was acting in the scope of
employment, or

(d) the principal or a managerial agent ofthe principal ratified or approyed the act.
Id.(quoting Restatement(Second) of Torts § 909(1977)).

Therefore, on the issue of punitiye damages in this ease, the releyant question at this time
under SDCL § 21-1-4.1 is whether the record, when disputed genuine issues of material fact are

yiew'ed in the light mostfayorable to Long,proyides clear and conyincing eyidence ofa reasonable

basis that a Smithfield agent under the Dahl complieity test aeted with presumed malice. See
generally Doe. 65; Doc. 78; Doc. 81. The analysis first requires determining whether, or how
much, notice and knowledge Smithfield employees had about LSC leaks from its tank and from
Building 127 to assess if anyone acted with presumed malice. The second issue requires

determining whether any Smithfield employee possessing knowledge ofthe leaks "was employed
in a managerial capacity and was acting in the scope of employment" to create possible punitive

damage exposure for Smithfield. S^ Dahl 474 N.W.2d at 903 (quoting Restatement(Second) of
Torts § 909 (1977)).

Smithfield takes the position that its supervisors had, at most, limited knowledge of LSC

leaking from the tank and no knowledge ofLSC leaking out ofthe building; this position has some
support in the record. S^ Doc. 34-26 at 7(Victor Hernandez explaining that he had "never seen"
foam escape Building 127 and that he was not aware of the potential for foam to escape through
the vent); Doe. 34-27 at 10(Ronnie Johnson stating he had "never seen [the LSC in Building 127]

foam up"); Doe. 34-30 at 21(Ken Winter noting that he could not say whether foam had previously
leaked out ofBuilding 127"from [his] ovm knowledge"); Doe.66-2 at 5(Choy Sayasavanh saying
he had "only seen [the tank foam over] once"); Doc. 66-4 at 5 (Mike Johnson testifying he had
never seen LSC escape Building 127 and that no one reported such a leak to him). If Smithfield
lacked this knowledge, the failure of its employees to remedy the chemical spills and prevent the

harm that Long incurred does not demonstrate the intentionality required under the presumed
malice standard; ignorance of the condition does not show Smithfield "consciously realized that

[its] conduct would in all probability, as distinguished from possibility, produce the precise result
which it did produce and would bring harm to" Long. Berry. 576 N.W.2d at 9(citation omitted).

10

However, the record equally supports Long's claims that Smithfield knew that LSC both

leaked from the tank and could escape Building 127.

Doc. 67-2 at 1 (report from Samuel

Kaschke to Mike Corbett, Mike Johnson, Choy Sayasavanh, Tony Liles, and Brian Roberts
mentioning a leak, LSC "run[ning] down the south side ofthe ...tank," and "a heavy buildup of
dry [LSC] around the pipe connections"); Doc. 34-25 at 5, 8 (Bobby Conner explaining that he
had seen foam escaping Building 127 "once in a while if [the deliverers] overfilled it," that he
"would get ahold of safety, or [he] would tell [his] supervisor" when that happened, and that he
"assumed" the paint and cinder block corrosion under the vent was from chemical leaking out);
Doc. 34-28 at 6(Costa Mpunga saying that he had seen a chemical or foam escape Building 127
twice,that he reported it, and that Safety Director Ken Winter and "other managers... came over
and survey[ed] the place" of the leak); Doc. 67-7 at 7, 10(Choy Sayasavanh noting he had seen

"lines of stain" under the vent). Based on this evidence, a reasonable jury could find that
Smithfield's failure to prevent LSC from escaping Building 127 was malicious because Smithfield
should know that the high risk of harm created by a class-three corrosive chemical leaking into

unprotected spaces outside Building 127 "would in all probability ... produce the precise result"
of chemically burning someone outside Building 127. A genuine dispute exists regarding
Smithfield's knowledge ofthe chemical leak, and that appears to be a material question offact for
the jury.

Smithfield urges that what appears to be contradictory evidence does not actually
demonstrate a genuine dispute of material fact. Smithfield argues that "evidence purporting to
show that[LSC]'foamed' over from its 3,500-gallon holding tank on a regular basis ... does not
show that the product created any safety risks" or that Smithfield knew it escaped Building 127.
Doc. 65 at 14 n.3. There certainly is a difference between knowing that LSC could escape from

11

the tank within the locked Building 127 and knowing that LSC had leaked out of Building 127
itself. Nonetheless, what Smithfield knew about the interior tank spills—compounded with the
evidence of the stained walls and testimony of non-managerial employees—can provide
circumstantial evidence that Smithfield also knew about LSC leaking out of Building 127.

Next, Smithfield asserts that any testimony suggesting Smithfield knew about the building
leak comes from non-managerial employees whose knowledge and conduct under the Dahl

complicity test cannot impose liability on Smithfield. This argument has two flaws. First, even if
Bobby Conner and Costa Mpunga are non-managerial employees and cannot satisfy Dahl by their

personal knowledge of chemical leaks, both testified to reporting building leaks to supervisors.
Doe. 34-25 at 5, 8(Bobby Conner stating that he "would get ahold of safety, or [he] would tell
[his] supervisor" when LSC dripped out the vent ofBuilding 127); Doc. 34-28 at 6(Costa Mpunga

indicating that he reported seeing prior chemical leaks and that Safety Director Ken Winter and
"other managers . . . came over and survey[ed] the place" of the leak). Although some of these

supervisors and managers were unnamed, Mpunga specifically states that Ted Winter, who
indisputably constitutes an individual meeting the Dahl complicity test for imposing liability on
Smithfield, did hear about the leaks. See Dahh 474 N.W.2d at 903 (adopting the complicity test

from the Restatement); Restatement(Second)of Torts § 909(1977)(holding a company liable for
action or inaction of agents "employed in a managerial capacity and . . . acting in the scope of

employment"). Second, whether Conner is a manager whose personal knowledge and inaction is
enough to impose liability on Smithfield is a disputed fact that makes summary judgment
inappropriate. S^ Doe. 34-25 at 3-4 (Conner explaining that he is a "leadman," which is "kind
ofa supervisor but not a supervisor," and that he "[m]ake[s] sure everybody's doing theirjob" and
oversees other employees); see also Doe. 65 at 9-10 (arguing Conner is not a supervisor who can

12

satisfy the complicity test); Doc. 78 at 29-30 (identifying Conner as a supervisor who could create
liability for Smithfield). By looking at Conner's role, duties, title, and other circumstances of his

employment, the jury—^and not this Court—^must resolve the question of fact of whether Conner
is a mere employee or a manager ofthe type satisfying the Dahl complicity test.
For these reasons, this Court denies Smithfield's motion for summary judgment on Long's

punitive damage claim. There exists a genuine dispute of material fact on whether Smithfield had
the requisite knowledge to constitute presumed malice sufficient to support a punitive damage
award, which is a jury question.

Liberty Ins. Corp.. 87 F.4th at 888 ("A factual dispute is

genuine if a reasonable jury could return a verdict for the nonmoving party." (cleaned up and
citation omitted)); Brown v. Sandals Resorts Int'l. 284 F.3d 949, 954 (8th Cir. 2002) ("It is
axiomatic that 'credibility determinations,the weighing ofevidence, and the drawing oflegitimate
inferences from the facts are jury functions, not those of a judge.'"(quoting Reeves v. Sanderson
Plumbing Prods.. Inc.. 530 U.S. 133, 150 (2000))); Citv of Bridgewater v. Morris. Inc., 594

N.W.2d 712,715(S.D. 1999). However, it is important to note that these factual disputes put this
Court in a somewhat awkward position. Summary judgment is plainly inappropriate where there

are genuine disputes of material fact,^Fed. R. Civ. P. 56(a), and the court's province is not to

resolve questions of fact, Janis v. Nash Finch Co., 780 N.W.2d 497, 505 (S.D. 2010)("The

question of whether [a landowner] rhet its duty to use reasonable care is a question of fact for a
properly instructed jury."(cleaned up and citation omitted)). After all, on summary judgment, a
court must view the material facts subject to genuine dispute in the light most favorable to the
nonmovant.

Yet SDCL § 21-1-4.1 requires "clear and convincing evidence" of a "reasonable basis to
believe that there has been willful, wanton or malicious conduct" before allowing a punitive

13

damages claim to be submitted to ajury at trial. SDCL §21-1-4.1 does not direct a court in making
that assessment to view the facts in a light most favorable to either party. Thus, nothing in this
opinion and order should be taken as guaranteeing that a punitive damages claim actually gets
submitted to the jury. That decision will not be made until this Court hears all the evidence and
can apply the substantive standard contained in the otherwise procedural statute SDCL § 21-1-4.1.
See Vreugdenhil v. First Bank of South Dakota. N.A.. 467 N.W.2d 756, 759-60 (S.D. 1991)

(allowing the court to assess credibility before submitting a punitive damage issue to the jury and
explaining "[t]he trial court found the plaintiffs did not establish by clear and convincing evidence

that there was a reasonable basis to believe the actions of[defendant] constituted willful, wanton
or malicious conduct. Where, as here, evidence was submitted through witness testimony,the trial

court is in a unique position to assess the credibility of the witness"(footnote omitted)); see also
Dziadek, 4:1 l-cv-04134-RAL, 2015 WL 7760193, at *12(allowing a punitive damages claim to

survive summary judgment but reserving for trial the issue of submitting the claim to the jury).
Therefore, Smithfield's Motion for Partial Summary Judgment, Doc.63,is denied and this
Court reserves until trial the decision whether to submit the punitive damages claim to the jury.
IV.

L&B's Motion for Summary Judgment

Smithfield claims that it was L&B's negligence—and not its own—^that caused Long's

harm, making L&B liable for any judgment entered in favor of Long. Doc. 16. Specifically,
Smithfield argues under theories of respondent superior, negligent supervision, and negligent

training that L&B is liable for any harm to Long because its employee Glenn Westlake (1)
negligently pumped the LSC at too high of a pressure, causing the chemical to foam and overflow
the tank, and (2)failed to initiate proper remedial or mitigation efforts after causing LSC to spill
outside ofthe tank. Doe. 16; Doc.74 at 7-11. L&B moved for summary judgment on Smithfield's

14

claims for indemnification and contribution against it, ^guing that it had no duty to Long and that
no reasonablejury eould find Westlake's conduct negligent. Doc. 59; Doc.62. Smithfield opposes
the motion by asserting that there are genuine disputes as to material faets. Doe. 74 at 1, 9. Zee
also opposes the motion, claiming that there is a material question of fact on whether Westlake

received and reviewed the SDS for LSC, which bears on the issue of breach of duty.'^ Doc. 70 at
2-3.

South Dakota law governs the substantive issues in this diversity-of-eitizenshipjurisdietion case. Bores. 530 F.3d at 674 (citing Erie R.R. Co. v. Tompkins. 304 U.S. 64, 78
(1938)). South Dakota recognizes both indemnifieation and contribution as available remedies for

atortfeasor. Averav. St. Luke's Hosp. v. Karamali. 848 F. Supp.2d 1017,1020-21 (D.S.D. 2012)
(eiting SDCL § 15-8-12; SDCL § 56-3; Ebert v. Fort Pierre Moose Lodge No. 1813. 312 N.W.2d

119, 122-23 (S.D. 1981)). "A right to contribution arises when a party to a joint, or joint and
several, obligation satisfies more than his share of the elaim against all. In contrast, indemnity is
an 'all-or-nothing' proposition where the party seeking indemnification must show an absence of
proportionate fault to shift the entire liability." Jorgensen Farms.Inc. v. Countrv Pride Coop..Ine..
824 N.W.2d 410, 414 n.2(S.D. 2012)(eleaned up and citation omitted). Therefore, to be entitled
to either contribution or indemnification if Smithfield were found liable to Long, Smithfield must

show L&B acted negligently and that L&B's negligenee eaused or eontributed to Long's harm.

L&B has not moved for summary judgment on the crossclaims between it and Zee for indemnity
and eontribution; however, resolving the issue of L&B's negligence for purposes of Smithfield's
claims for indemnity and contribution could essentially determine the outcome of those
crosselaims. If this Court were to grant summary judgment in favor of L&B on Smithfield's
claims, it would have to determine L&B was not negligent as a matter of law. As a result. Zee's
claims against L&B for indemnification and contribution would similarly fail.
15

An employer can be vicariously liable for the negligent actions of its employee under the
theory ofrespondent superior when the employee is acting in the course and scope ofemployment,
Iverson v. NPC Int'l. Inc.. 801 N.W.2d 275,278-79(S.D. 2011),or can be directly liable for acting

negligently in supervising or training an employee who acts negligently, Kirlin v. Halverson, 758
N.W.2d 436, 448 (S.D. 2008)("Generally, the law imposes no duty to prevent the misconduct of

a third person. However, an employer may be held liable for negligent hiring, retention, training

and supervision."(cleaned up and citations omitted)). In either circumstance, the plaintiff must
show the employee acted negligently or in an otherwise tortious manner.

To show negligence, a plaintiff must demonstrate the defendant had a duty, that the
defendant breached that duty, and that the breach caused harm to the plaintiff. Hanson v. Big
Stone Therapies. Inc.. 916 N.W.2d 151, 158 (S.D. 2018)("In order to prevail in a suit based on

negligence, a plaintiff must prove duty, breach of that duty, proximate and factual causation, and
actual injury."(citations omitted)). Whether the defendant had a duty is a question oflaw for the
court. Janis. 780 N.W.2d at 500. Whether the defendant breached that duty and, in so doing,

caused harm to the plaintiff are questions offact typically reserved for the jury. Stone v. Von Eve

Farms. 741 N.W.2d 767, 770 (S.D. 2007)("This Court has repeatedly stated that questions of

negligence, contributory negligence and assumption ofthe risk are for the jury in all but the rarest
of cases so long as there is evidence to support the issues."(citation omitted)). In fact,"only when
reasonable men can draw but one conclusion from facts and inferences" on issues of negligence

do "they become a matter of law" proper for the court to decide on summary judgment. Stone,
741 N.W.2d at 770 (citation omitted).
A. Duty

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South Dakota law imposes a duty to protect others from harm "depend[ing] on the
relationship ofthe parties and public policy considerations." .Tohnson v. Havman & Assocs., 867
N.W.2d 698,702(S.D. 2015)(internal citations omitted). The duty a landowner owes to an entrant
on the property depends on whether that entrant is a trespasser, licensee, or invitee, which includes
a business invitee "who is invited to enter or remain on land for a purpose directly or indirectly
connected with business dealings with the possessor of land." Janis. 780 N.W.2d at 501 (cleaned
up and citation omitted). "As a general rule, the possessor of land owes an invitee or business
visitor the duty ofexercising reasonable or ordinary care for the benefit ofthe invitee's safety, and
the possessor is liable for the breach ofsuch duty." Id (cleaned up and citation omitted).
In some circumstances, this duty can extend to an independent contractor on the premises
when that party "steps into the shoes of[the primary land possessor] and is entitled to [the primary
land possessor's] liabilities and immunities." Ebaugh v. PetSmart. Inc., Civ. No. 10-4153, 2012
U.S. Dist. LEXIS 91993, at *16(D.S.D. July 3, 2012). Under the Restatement(Second) of Torts,
this extension of liability and immunity arises under the following circumstances:

One who on behalfofthe possessor ofland erects a structure or creates any other condition
on the land is subject to the same liability, and enjoys the same freedom from liability, as
though he were the possessor of the land, for physical harm caused to others upon and
outside the land by the dangerous character of the structure of other condition while the
work is in his charge.

Restatement(Second)of Torts § 384. The Supreme Court of South Dakota has not considered the
adoption of§ 384, but this Court predicts that it would do so. See Ebaugh. 2012 U.S. Dist. LEXIS

91993, at *16 (explaining that, like a prior case,"[t]he court will also assume here that the South
Dakota Supreme Court would adopt § 384"); Smithev v. Stueve Constr. Co.. Civ. No. 04-4067,
2007 U.S. Dist. LEXIS 3871 (D.S.D. Jan. 18, 2007) (determining South Dakota would likely
follow the majority ofjurisdictions in applying § 384).

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Here, Long was a business invitee of Smithfield because he was at the plant to deliver
shipments ofvarious products Smithfield ordered for its business operations, thereby "cormect[ing
him] with business dealings with the possessor of the land." Janis, 780 N.W.2d at 501 (citation
omitted). Smithfield thus owed Long a duty to exercise reasonable or ordinary care. That duty
extended to L&B because L&B, while working on behalf of Smithfield to fill the LSC tank,

arguably created a dangerous land condition when Westlake pumped the LSC into the tank in
Building 127 in a manner causing it to foam into the alley outside Building 127. S^ Restatement
(Second) of Torts § 384.

L&B also had a duty to Long based on foreseeability ofinjury to another from mishandling
the delivery of a dangerously corrosive product like LSC. In cases where the parties do not have
a relationship imposing a duty,"foreseeability may also create a duty. Although foreseeability is

a question of fact in some contexts, foreseeability in defining the boundaries of a duty is always a

question of law." .Johnson. 867 N.W.2d at 702 (cleaned up and citations omitted). L&B had a
duty to properly deliver and unload LSC at Smithfield in a way that avoided injury to Smithfield's
business invitees and others who might be or come into the area of Building 127. Overfilling the

tank in Building 127 to the point where the dangerously corrosive LSC leaked out ofthe vent and
into the alley area foreseeably could injure business invitees of Smithfield unaware of LSC's

dangerous properties. Therefore, L&B owed a duty of reasonable care to Long as a business
invitee and as a foreseeable plaintiff, and L&B's breach of that duty could support Smithfield's
claims for indemnity or contribution from L&B.
B. Breach

The parties dispute whether Westlake breached his duty of reasonable care by filling the
LSC tank too quickly and failing to take remedial measures after realizing the tank was foaming

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over. This dispute involves genuine issues of material facts, making entry of summary judgment
inappropriate. See Fed. R. Civ. P. 56(a)(only allowing summary judgment where "there is no
genuine dispute as to any material fact"); Fed. R. Civ. P. 56(c)(1)(a) (indicating that a "party
asserting that a fact carmot be or is genuinely disputed must support the assertion by citing to
particular parts of materials in the record, including depositions, documents, electronically stored
information, affidavits ..., admissions, interrogatory answers, or other materials"); Iverson. 801
N.W.2d at 279 (stating that breach is a "factual question[] that must be determined by the trier of
fact").

L&B first argues that Smithfield had the responsibility for instructing Westlake to deliver
the LSC at an idle speed because the overflow system on the tank was not working properly, and
Smithfield's failure to instruct him means no reasonable jury could find Westlake's conduct

breached his duty of reasonable care. Doc. 62 at 7; see also Doc. 61-2 at 5 (Westlake indicating
that Smithfield did not give him any instructions about the speed or pressure to use when pumping
the LSC into the tank); Doc. 61-7 at 3 (Ken Winter confirming that LSC foamed out of the tank

because the lid would not close completely). L&B further asserts that Westlake reviewed the SDS

and acted reasonably in pumping the LSC at a higher speed and pressure because the SDS did not

alert Westlake to the possibility ofthe chemical foaming.^ Doc. 61-2 at 5, 7; Doc. 62 at 8.

^ Zee disputes whether Westlake did, in fact, review the SDS for LSC. David Tolleson, the
Manager-Freight Logistics ofKenco Transportation Management,LLC("Kenco")and the broker
who organized L&B's deliveries to Smithfield, signed an affidavit describing Kenco's practices
of providing SDS to drivers. Doc. 73 at 1-2. Tolleson stated that Kenco provides the SDS when
requested, that he did not provide Westlake with an SDS because Westlake never requested one,
and that most drivers have enough experience pumping chemicals like LSC that they do not ask to
review the SDS. Doc.73 at 1-2(stating that he "do[es]not provide... material data sheets(SDS),

unless the carrier or driver requests them," that providing an SDS is "unusual" because the drivers
are experienced, and that he "do[es] not recall a driver for L&B Transport, LLC ever requesting
the [SDS] from" him). Through this affidavit, Zee attempts to suggest Westlake never did read
the SDS. However, nothing in the affidavit indicates that that only Kenco—and not Zee—would
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Smithfield counters that L&B should have informed Westlake about LSC's foaming
potential and about the plant's tank overflowing during a prior delivery as part ofits responsibility
for supervising and training him. Doc.74 at 2,10-11. Ofcourse,it is L&B's alleged negligence—
and not Smithfield's—^that matters in ruling on this motion for summary judgment. A reasonable

jury could find that L&B's failure to instruct Westlake about the precautions and care when

delivering and offloading LSC at Smithfield's plant constituted a breach of its duty to supervise
and train Westlake. Further, a reasonable jury could determine that Westlake was negligent in

pumping the LSC at a non-idle speed or continuing to unload LSC at a lower rate despite knowing
the tank had foamed over. Viewing the genuinely disputed material facts in the light most

favorable to Smithfield,the issue ofL&B's alleged breach of duty is a question offact which must

go to the jury. A reasonable jury could find that L&B,directly or vicariously through its employee
Westlake, breached the duty of reasonable care to properly and safely deliver the LSC to
Smithfield's plant.

Smithfield also argues that there are questions of fact related to whether Westlake's post-

spill conduct constituted a breach of duty. First, Smithfield relies on Westlake's failure to report
the spill to any government authority to claim that Westlake's conduct breached the duty of care;

had he reported the spill, Smithfield contends, someone would have taken remedial measures that
would have prevented Long's injury. Doc.74 at 9; see also Doc. 34-32 at 12(Westlake testifying
that he did not report the spill to CHEMTREC or any governmental authority but that he did

"report[] it to [his] immediate supervisor"). Second, Smithfield asserts that a jury, and not the
court, is responsible for making credibility determinations regarding Westlake's testimony that he

have provided the SDS. Doc. 70 at 1-2; see also Doc. 72-1 at 5 (Westlake claiming that giving
drivers the SDS "was the responsibility ofthe shipper who also manufactured that product," which
would be Zee). Regardless, this appears to be a fact issue for trial.
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spoke to a Smithfield supervisor about the LSC spill because, according to its interrogatory
request, Smithfield "has not been able to locate any such person despite its good faith efforts to do
so." Doc. 61-1 at 1. Other employees working that day are also unable to identify the supervisor
who presumably was on shift. See Doc. 34-28 at 8 (Costa Mpunga stating he carmot remember
which manager was on shift that day). L&B counters that Westlake did not need to report the spill
to outside entities because of the size ofthe spill and the response from the Smithfield supervisor
with whom he spoke. Doc. 79 at 4; Doc. 34-32 at 12. L&B argues that there is no competent
record evidence to directly contradict Westlake's testimony and highlights that Smithfield's own
employee partially corroborated Westlake's story when he testified that a manager was present
and approved the delivery before Westlake began pumping the LSC. Doc. 79 at 4-7.

L&B also asserts that Smithfield has not produced any expert testimony to suggest that it
breached its standard of care in supervising and training Westlake by failing to tell Westlake about
the chemical's foaming potential and the prior delivery spill at the Smithfield plant. Doc. 79 at 4.

Expert testimony is generally necessary to show breach in cases of professional negligence, but it
is not required if"the area is within the common knowledge and comprehension of the ordinary

laymen. Unless the issues are unusually complex,expert testimony is not required." Mid-W.Elec.
V. DeWild Grant Reckert & Assocs. Co., 500 N.W.2d 250,255(S.D. 1993)(citation omitted); see
also Jaeger v. Henningson. Durham & Richardson. Inc.. 714 F.2d 773,775-76(8th Cir. 1983)(not

requiring expert testimony under South Dakota law when nothing in facts was so highly technical
to be outside the experience or understanding of laymen). Although Westlake's conduct in
delivering the chemicals could be the subject of expert testimony, ordinary laymen without expert

assistance likely can grasp a dispute over an employer's alleged failure to train and supervise an

employee ofknown risks related to delivering a hazardous chemical. Therefore, a reasonable jury

21

does not need expert testimony to decide whether L&B breached its duty of care by not informing
its driver, who transports and delivers dangerous chemicals, about the chemical's properties and

specific delivery instructions, including not filling a tank in a manner to have the caustic substance
flow out into an alley.

There exists a question of fact on whether Westlake breached his duty of reasonable care

by failing to further report the spill, as required by L&B's policies, to CHEMTREC or a

government agency. See Doc. 34-32 at 41. Moreover, viewing Westlake's testimony,the existing

deposition testimony ofthe various Smithfield employees who were at the plant on the day ofthe
incident, and Smithfield's interrogatory response related to making every effort to uncover the

supervisor in the light most favorable to Smithfield, there are questions of fact related to what
information Westlake reported about the spill, to whom he reported that information, whether that

person was a supervisor sufficient to create liability for Smithfield, and whether these actions met
his duty of care. Resolving the question of whether Westlake's post-spill conduct constituted a
breach of the duty of care belongs in the hands of the jury, making summary judgment

inappropriate. See Iverson. 801 N.W.2d at 279 (stating that breach is a "factual question[] that
must be determined by the trier of fact"); Fed. R. Civ. P. 56.

For these reasons, this Court cannot conclude as a matter oflaw that Westlake and, in turn,

L&B,acted reasonably and did not breach the duty ofcare. Therefore, genuine issues of material
fact on Smithfield's third-party complaint render summary judgment for L&B inappropriate.
V.

Conclusion

For the reasons explained, it is
ORDERED that Smithfield's Motion for Partial Summary Judgment, Doc. 63, is denied.
It is further

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ORDERED that L&B's Motion for Summary Judgment, Doc. 59, is denied.
DATED this

day of June,2024.

BY THE COURT:

ROBERTO A. LANGE
CHIEF JUDGE

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