Federal Court Dismisses Products Case (in part) Due to Failure to Complete Service and Statute of Limitations Issues

The failure to complete service under the applicable statute of limitations was the issue reviewed in the case of Ginzburg v. Electrolux Home Products, No. 17-3384 (E.D. Pa. Jan. 19, 2018 Quinones Alejandro, J.).   In this matter, the Federal Court granted a Defendant’s Motion to Dismiss due to the Plaintiff’s failure to complete service of process within the applicable statute of limitation. 

In this matter, the case originally was brought in the state court but was removed to federal court.   The Federal Court noted that, even though initial service of process may have been improper in a matter, under 28 U.S.C.§1448, a Plaintiff is permitted to reserve the right to correct such deficiencies once a case has been removed to Federal Court.  

Although the Plaintiff did reserve such rights, the court found that dismissal was still proper on the grounds of improper service of process.  

More specifically, the court ruled that, under Pennsylvania law, Plaintiff’s failure to serve the Defendant properly within ninety (90) days of a filing a Praecipe for Writ of Summons precluded the Writ from tolling the statute of limitations.   Given that the two (2) year tort statute of limitations had expired, the court found that all of the Plaintiff’s products liability and tort claims must be dismissed.

In its Opinion, the court noted that a defective attempt of service at the last minute to the wrong address did not amount to proper service, or even a good faith attempt at service.   The court emphasized that the Defendant never received actual notice of the suit until after the statute of limitations had expired.  

On the breach of warranty claims, the court noted that only the filing of a actual Complaint, and not the defective service of the Writ, could serve to toll the four (4) year statute of limitations applicable to that type of cause of action.  

In this matter, the Complaint did not allege the date that the product was delivered and, as such, the Complaint was deemed to be deficient in pleading the warranty claims.  Accordingly, the court dismissed the breach of warranty claim without prejudice to the Plaintiff’s right to amend the Complaint with allegations of a delivery of the product within the four (4) year period.  

Anyone wishing to review a copy of this decision may click this LINK.  The court's companion Order can be viewed HERE.

I send thanks to Attorney James M. Beck of the Philadelphia office of the law firm of Reed Smith for bringing this case to my attention. 

ARTICLE: Jury Instructions in Products Liability Cases Create More Debate Than Consensus

The below article of mine appeared in the March 20, 2018 edition of the Pennsylvania Law Weekly and is republished here with permission:

 

 

Jury Instructions in Products Liability Cases Create More Debate Than Consensus

By Daniel E. Cummins | March 20, 2018
Pennsylvania Law Weekly

With the law of products liability cases continuing to evolve in the post-Tincher era, growing pains are being felt by both the courts and practitioners. In particular, as reported in numerous recent articles in the Pennsylvania Law Weekly and The Legal Intelligencer, the trial courts are faced with conflicting positions from the plaintiff’s bar and the defense bar on the proper language for jury instructions in post-Tincher products cases.

After the Tincher decision was handed down by the Pennsylvania Supreme Court in 2014, the civil instructions subcommittee of the Pennsylvania Supreme Court committee for proposed standard jury instructions drafted suggested standard civil jury instructions for products liability cases which were then published by the Pennsylvania Bar Institute (PBI).

The post-Tincher jury instructions drafted by the subcommittee were quickly criticized by members of the defense bar who felt that the language in the instructions was not entirely consistent with the law laid down in Tincher. In a touch of irony, it may be said that members of the defense bar view these suggested jury instructions on products liability cases as being defective.

With members of both the plaintiffs bar and the defense bar being so vociferous in their opposing positions on these suggested standard civil jury instructions for products liability claims, and given that the language of some portions of these instructions have been called into question by the recent decision of the Superior Court in Tincher, it may be advisable for the civil instructions subcommittee to go back to the drawing board in an effort to come up with a consensus on such instructions for the benefit of both the courts and the litigants.

A revised set of products liability jury instructions would not only quiet the debate but, more importantly, would further the interest of judicial economy by potentially avoiding appeals and, in those cases that are appealed, possibly avoiding the need for appellate courts to overturn verdicts on the basis of improper jury instructions utilized by the trial court.

‘Tincher’ Altered the Law (Somewhat)

Back in 2014, when the Pennsylvania Supreme Court released its much-anticipated products liability decision in the case of Tincher v. Omega Flex, the central question before the court was whether the strict liability analysis of Section 402A of the Reinstatement (Second) of Torts should be replaced with the analysis contained in the Restatement (Third) of Torts.

In its 128-page majority opinion, the Pennsylvania Supreme Court elected to stay with Section 402A of the Restatement (Second) of Torts but also chose to overrule the prior notable products liability decision of Azzarello v. Black Brothers, 391 A.2d 1020 (Pa. 1978) and that court’s negligence/strict liability analysis which had been followed by Pennsylvania litigators for 36 years.

The prior Azzarello decision and its progeny were plaintiff-friendly in that those decisions fostered the removal of all negligence concepts from products liability cases in favor of strict liability concepts. The Azzarello decision also held that the trial court, and not the jury, was in charge of evaluating the risk/utility of a defendant’s product. Under the law set forth in Azzarello, the trial courts were additionally required to instruct juries that the manufacturer or supplier of a product was a guarantor of the safety of its product.

The Supreme Court in Tincher expressly overruled Azzarello and disapproved of that court’s support for a jury instruction that a “manufacturer is a guarantor of its product.” The Tincher court formulated an altered standard of review for Pennsylvania products liability cases that focused on both a “consumer expectation” and a “risk/utility” definition of a defect.

Under the consumer expectation test, a product may be found to be in a defective condition if the danger posed by the product is unknowable and unacceptable to the average or ordinary consumer.

The separate “risk/utility” standard, required the utilization of a balancing test to weigh the risks and utilities of the products, as stated in some cases, a cost/benefit analysis.

Under the risk/utility test, a product may be found to be defective when the probability and seriousness of harm caused by the product outweighs the burden or cost of taking precautions against the risk. The risk/utility analysis takes into account a number of many different factors, commonly known as Wade factors.

A Debate Arises

The stated goal of the civil instructions subcommittee appointed by the Pennsylvania Supreme Court is to draft clear, concise instructions that are understandable to citizen jurors, while ensuring that the proposed instructions reflect the current law and case law.

The current debate between the plaintiffs bar and the defense bar centers on whether the suggested standard civil jury instructions pertaining to products liability cases accurately reflect the law of Tincher.  Important portions of these suggested products liability instructions have been challenged by members of the defense bar as being inconsistent with the Supreme Court’s analysis and ultimate decision in Tincher.

In an unprecedented move, members of the Pennsylvania Defense Institute even drafted and published its own recommended products liability jury instructions in 2016. Since that time, trial courts have been faced with strong arguments from each side as to the proper content for the jury charge in products cases.

Areas of Contention

Several areas of contention exists between the plaintiffs bar and the defense bar on the proper wording of products liability jury instructions.

While the suggested standard jury charges published by the PBI do not contain language pertaining to whether a product is “unreasonably dangerous,” the jury charge published by the defense bar adds that language. The defense bar also proposes the removal of language from the subcommittee’s instructions indicating that a product is dangerous if it lacks any element necessary to make it safe for its intended use as such language is only supported by the Azzarello decision which, as noted, was overruled.

Perhaps the sharpest area of dispute is the contention that the PBI’s suggested standard jury instructions maintains other language that is also consistent with the overruled Azzarello decision, namely that the product manufacturer or supplier is a guarantor of the safety of its product.  In the jury instructions propounded by the members of the defense bar, the Azzarello “guarantor” language is not included.

Some of these areas of contention can now be addressed in light of the Pennsylvania’s Superior Court’s most recent February 2018, decision issued in the ongoing saga of the Tincher case.

Latest Pronouncement

In its recent Tincher decision, the Pennsylvania Supreme Court confirmed that the inclusion of language in jury instructions consistent with the law set forth in Azzarello should be avoided as that decision was overruled by the Pennsylvania Supreme Court in its 2014 decision in Tincher.

The Pennsylvania Superior Court in Tincher more specifically determined that a new trial was necessary in that case, in part, because the jury instructions that were provided by the trial gave the jury an outdated definition of “defect” rooted in the overruled Azzarello case. The Superior Court noted that the trial court, relying upon the law of Azzarello, had instructed the trial court that a product is defective if it “lacks any element needed to make it safe for its intended use.”

The Superior Court ruled in Tincher that “if an incorrect definition of ‘defect’ under Azzarello calls for a new trial, an incorrect definition of ‘defect’ under Tincher should call for the same result.” Given that the trial court gave a charge under the law that the Pennsylvania Supreme Court explicitly overruled, the Superior Court in Tincher found this to be a fundamental error on the part of the trial court and, as such, the case was remanded for a new trial.

The decision by the Superior Court and its reiteration of the Pennsylvania Supreme Court’s notion that the Azzarello language has been disapproved supports the notion that, at a minimum, the Azzarello-type language contained in the PBI published suggested standard jury instructions is improper and should be revised to mirror the law of Tincher.

Action Needed to Quiet the Debate

The hope remains that members of the defense bar and the plaintiffs bar can work together with the civil instructions subcommittee to come to an agreement on the proposed language such that, one day in the not too distant future, there will be a set of products liability suggested standard civil jury instructions that litigants can rely upon in anticipation of trial and that trial court judges can simply read to the jury just like any other accepted instructions published by the PBI.

With a debate as loud as the one currently going on between the plaintiffs bar and the defense bar, the suggested standard civil jury instructions should be revisited, particularly since certain language contained in these instructions has been called into serious question by the reasoning in the most recent decision in the Tincher case issued by the Pennsylvania Superior Court.

Unfortunately, it may be a while before any revisions may take place. It is likely that there will be a continuing debate between the plaintiffs bar and the defense bar over whether such changes are even necessary. If a decision is eventually reached that revisions to the suggested jury instructions should be made to quiet the debate and conform the instructions more closely with the law of Tincher and its progeny, it will then likely take another extended period of time before the subcommittee can secure a consensus before a revised set of instructions are issued and published.

And so, in the meantime, given the sharp differences between plaintiffs attorneys and defense attorneys on the proper language to be utilized to charge a jury in a products case, along with the fact that a valid argument exists that that at least portions of the current PBI instructions are not entirely consistent with post-Tincher law, trial court judges should be leery of simply reading to the jury the suggested standard civil jury instructions on this topic as they are currently worded.

In an effort to avoid appellate issues, or worse, remands of products liability cases for expensive, docket-clogging new trials, trial court judges might instead order the opposing parties to work out their differences prior to trial and to stipulate to agreed-upon language for the charge of the jury.

Where, as is likely, the parties are not able to come to an agreement on the proposed language for the charge to the jury, trial court judges should alter the current PBI jury instructions with amendments to render them consistent the applicable law as may continue to be developed by the appellate courts in post-Tincher cases.

The current contested PBI instructions are, after all, only suggested jury instructions that are not binding upon trial courts of Pennsylvania.

Daniel E. Cummins is a partner with the Scranton law firm of Foley, Comerford & Cummins. He focuses his practice on the defense of auto accident, premises liability and products liability matters.  His Tort Talk Blog can be viewed at www.TortTalk.com.

 

Federal Court Confirms Reinsurer Not An 'Insurer' Under Bad Faith Statute

In the case of Three Rivers Hydroponics, LLC v. Florists’ Mut. Ins.  Co., No. 15-809 (W.D. Pa. Feb. 20, 2018 Hornak, J.), the court held that, under the facts presented in this case, a reinsurer is not an “insurer” for purposes of the bad faith statute.  

In this matter, the insured initially filed a bad faith and breach of contract suit against its insurer.  The insured later filed an Amended Complaint alleging bad faith and breach of contract against the reinsurer.  

The reinsurer filed a Motion to Dismiss all claims.   The reinsurer argued that it was not an “insurer” for purposes of Pennsylvania’s Bad Faith Statute.  

The court ruled that “Pennsylvania law requires the Court to consider two factors when determining whether a party is an ‘insurer’ for the purposes of the bad faith statute: (1) the extent to which the company was identified as the insurer on the policy document; and, (2) the extent to which the company acted as insurer.”

In this case, the court found that the reinsurer was not listed anywhere on the policy documents.  Accordingly, under the first factor noted above, the court found that reinsurer was not a party to the policy between the insured and the insurer.  

With regards to the second factor, the court noted that “a party acts as an insurer when it ‘issues policies, collects premiums, and in exchange assumes certain risks and contractual obligations’.”

Here, the court found that the reinsurer was not the insured’s ‘insurer’ for purposes of the bad faith statute because it did not issue the policy to the insured, it did to collect premiums from the insured, it did not make any insurance payments to the insured, and it did not assume any risk or contractual obligations towards the insured.

Accordingly, the court dismissed the bad faith claim against the reinsured because that entity was not an ‘insurer’ for purposes of the bad faith statute.

The court additionally dismissed the breach of contract claim against the reinsurer as there was no contractual privity between the reinsurer and the insured.  

Anyone wishing to review this case may click this LINK.

I send thanks to Attorney Lee Applebaum, the writer of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog for bringing this case to my attention.  Check out Attorney Applebaum's blog HERE.

Western District Federal Court Remands Bad Faith Claim to State Court

In the case of Sciulli v. GEICO, No. 16-1907 (W.D. Pa. Feb. 26, 2018 Flowers Conti, C.J.), the court remanded a case back to State Court under the below circumstances.

According to the Opinion, the carrier had removed the case to Federal Court based upon diversity jurisdiction. At the time of removal, there was diversity and “there was a good faith belief that the amount in controversy exceeded $75,000 because [the insured] could recover punitive damages under the Pennsylvania Bad Faith statute.”

However, the insured later agreed to voluntarily dismiss the insurance bad faith claim leaving only an $18,000 breach of contract claim.

The court applied 28 U.S.C. § 1447(c), which provides that “If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.”

Applying section 1447(c), the court found the case no longer involved a dispute in excess of $75,000, and the insurer agreed that remand was proper.

Anyone wishing to review this decision may click this LINK.

I send thanks to Attorney Lee Applebaum of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog for bringing this case to my attention.  Click HERE to visit that Blog (Highly Recommended!).

Eastern District Federal Court Addresses Corporate Negligence Claims In Med Mal Case

In the case of McClure v. Parvis, No. 17-3049 (E.D. Pa. Feb. 6, 2018 Savage, J.), the court denied a Motion to Dismiss filed by a Defendant in a medical malpractice claim raising issues of corporate negligence.

The court noted that a claim for corporate negligence arises from the policies, acts, or omissions of the entity itself, and not from specific acts of the individual employees of the entity.  

Notably, while this court indicated that corporate negligence theories are not limited to hospitals, it otherwise noted that the courts of Pennsylvania have not extended such theories to apply to physician offices as such offices are not comprehensive health centers that are responsible for the total health of its patients.  

The court also noted that, to decide whether a particular health care entities owes the Plaintiff a non-delegable duty requires an examination of the extent of that entity’s oversight and control of the medical professionals directly providing the care to the Plaintiff.   As this determination is fact-based, the court ruled that this analysis could not be completed at the Motion to Dismiss stage. 

Accordingly, the court denied the Motion to Dismiss filed in this matter and allowed the case to proceed into discovery.  

Anyone wishing to review a copy of this decision may click this LINK.  The Court's companion Order can be viewed HERE.

I send thanks to Attorney James M. Beck of the Philadelphia office of the law firm of Reed Smith for bringing this case to my attention. 

Pennsylvania Superior Court Holds that Social Media Posts Must Be Authenticated Before Being Admissible in Evidence

Every once in a while a criminal court decision comes along that may have an impact in civil litigation matters.

In the case of Commonwealth v. Mangel, No. 2018 Pa. Super. 57 (Pa. Super. March 15, 2018 Musmanno, S.J. Ott, J., Shogan, J.)(Op. by Musmanno, J.), the Pennsylvania Superior Court ruled that social media posts are inadmissible in criminal cases unless prosecutors can present evidence of who actually authored the commentary.

The court ruled in this fashion after noting that social media accounts can be easily hacked or faked.  In so ruling, the court affirmed an Erie County trial court decision denying a prosecutor's motion in limine seeking to introduce into evidence Facebook posts and messages allegedly authored by the Defendant.

Both the trial court and the appellate court found that merely presenting evidence that the posts and messages came from a social media account bearing the Defendant's name was not enough to allow the evidence in.

The court noted that Facebook posts and messages must instead be authenticated under Pa.R.E. 901 in a manner similar to how text messages and instant messages are authenticated.

Judge Musmanno wrote that "authenticating social media evidence is to be evaluated on a case-by-case basis to determine whether or not there has been an adequate foundational showing of its relevance and authenticity.”

The Superior Court in Mangel relied on its own 2011 decision in Commonwealth v. Koch which dealt with the admissibility and authentication of cell phone text messages.  Commonwealth v. Koch, 39 A.3d 996, 1005 (Pa. Super. 2011), affirmed by an equally divided court, 106 A.3d 705 (Pa. 2014) (cell phone text messages); See also In the Interest of F.P., a Minor, 878 A.2d 91, 96 (Pa. Super. 2005) (computerized instant messages).

Click this LINK to view my Pennsylvania Lawyer magazine article on the Commonwealth v. Koch case.

Click this LINK to view the Tort Talk post on the split Pennsylvania Supreme Court decision in Commonwealth v. Koch.

In the recent Commonweath v. Mangel case, the court noted that the Koch court held that “authentication of electronic communications, like documents, requires more than mere confirmation that the number or address belonged to a particular person. Circumstantial evidence, which tends to corroborate the identity of the sender, is required.”

The Mangel court ruled, in a case of first impression, that the same standard should apply to social media posts in the criminal court context.

Anyone wishing to read the Commonwealth v. Mangel decision may click this LINK

Commentary:  It is safe to predict that the same standards would be applied in a civil litigation matter as well with respect to the admissibility of social media posts, emails, or text messages.


Source:  Article by Zack Needles entitled "Superior Court Adopts Standard for Authenticating Social Media Post." The Legal Intelligencer (March 21, 2018).

Federal Court Addresses Standards for Jurisdiction Over Out-of-State Defendant

In the case of Wylam v. Trader Joe’s Co., No. 3:16 - CV - 2112 (M.D. Pa. Jan. 18, 2018 Mariani, J.), a Pennsylvania Federal Court denied a Motion to Dismiss without prejudice in this matter involving a question of proper general personal jurisdiction over an out-of-state Defendant.  

The Court ruled that there is no general jurisdiction over the moving third party Defendant in this matter.   Rather, that Defendant was noted to be a foreign  company with a principle place of business abroad.   No minimal contacts within Pennsylvania were seen in the record.   More specifically, the Opinion noted that the Defendant did not have any physical presence in the Commonwealth of Pennsylvania. 

Judge Robert D. Mariani
M.D. Pa.

Judge Robert D. Mariani noted that the Plaintiff was attempting to rely upon a stream of commerce personal jurisdiction argument.  The Court noted that this argument has never been approved by the Pennsylvania Supreme Court, while not being decisively rejected either.  

However, the court in Wylam ruled that a single in-state sale, without some additional conduct directed towards the forum state, did not support the Plaintiff's stream of commerce jurisdiction argument.  

The Court also noted that the fact that a Defendant’s products are carried by national retailers is also insufficient to establish jurisdiction in any state.  

The court also generally noted that it is the burden of the Plaintiff to establish jurisdiction and that speculation in this regard is not sufficient.  

As stated, the court denied the Motion to Dismiss without prejudice.   However, the Plaintiff was allowed to complete jurisdictional discovery, limited to the stream of commerce issue in an effort to gather further support for the jurisdictional arguments.  

Anyone wishing to review a copy of this decision may click this LINK.  The companion Order can be viewed HERE.

I send thanks to Attorney James M. Beck of the Philadelphia office of the law firm of Reed Smith for bringing this case to my attention.