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From Products Liability Law Daily, October 1, 2015

Cambering machine assembler thrown a curve as defective design, warning claims are sent to jury

By Pamela C. Maloney, J.D.

Whether a company that assembled a cambering machine in accordance with the plans and specifications provided by another company was liable for a worker’s injuries caused by alleged defects in the machine’s design and for failing to warn of dangers associated with the design raised a question of fact properly left to the jury, a federal district court in South Dakota determined. In addition, the question of whether the company that purchased the assets of the company which had designed the machine could be liable for the worker’s injuries also required jury resolution. However, the successor company had no duty to warn the worker of risks associated with the alleged defects because there was no evidence that the successor know that a defect existed (Klynsma v. Hydradyne, LLC, September 30, 2015, Viken, J.).

Background. A worker was killed when a highway expansion joint (or weldment) he was attempting to straighten in the cambering machine was released suddenly from the machine’s chamber, striking him in the head. The worker was knocked backward onto the floor and the weldment came to rest on the worker’s chest. Blunt force trauma was determined to be the cause of death. The cambering machine—a hydraulic machine designed to put a curve or camber into certain metal I-beams—was assembled in part by T.J. Welding & Fabrication Co. (TJW), in strict accordance with plans and specifications provided entirely by Cambco Inc., which was acquired by Hydradyne pursuant to a purchase agreement that gave Hydradyne the exclusive right to sell, without limitation, hydraulics and design kits for Cambco cambering machines.

The worker’s estate brought a product liability action against these three companies in which claims for strict liability design defect and failure to warn were pleaded along with negligent design and negligent failure to warn claims. TJW moved for summary judgment, arguing that as the assembler of the machine, it had no liability for the worker’s death. Hydradyne also moved for summary judgment based on the judicially-created protections afforded successor corporations in products liability actions. Hydradyne also contended that it had no duty to warn the worker of any alleged risks associated with the cambering machine.

Design defect claims. Acknowledging that there were no South Dakota cases specifically addressing the extent to which a non-designing manufacturer following the specifications of a product’s designer could be held liable for an allegedly defective product, the district court instead relied on decisions by the U.S. Court of Appeal for the Eighth Circuit and the Nebraska Supreme Court in following the majority rule which states that a non-designing manufacturer is not liable for design defects when it builds a product in accord with the design specifications with one exception, i.e., those specifications were so obviously dangerous that the non-designer manufacturer should not have followed them.

Based on the evidence in this case, the court concluded that a genuine issue of material fact was raised as to the obviousness of the alleged defect in the cambering machine. The estate alleged that the machine was defective because it lacked a safety barrier or guard to prevent an ejected weldment from striking the operator. The assembler of the machine failed to offer evidence demonstrating that this design was not obviously dangerous or to counter the estate’s expert evidence that the hydraulic hoses and fittings in the machine were exposed and needed to be protected from potential damage when transitioning weldments during routine operations and operator entry and exit. Thus, summary judgment on both the strict liability and negligent design defect claims was denied.

Failure-to-warn claims. The court’s adoption of the majority rule imposing strict liability and negligence on a non-designing manufacturer when the designer’s specifications were so obviously dangerous that they should not be followed also precluded summary judgment on the estate’s strict liability and negligent failure to warn claims. The question of the assembling manufacturer’s ability to foresee the worker’s injury depended on the degree of obviousness, if any, of the alleged design defect was one for the jury to resolve.

Successor liability. Turning to the question of whether the continuation exception to the general rule that a corporation which purchases the assets of another corporation does not succeed to the liabilities of the selling corporation, the court again concluded that the evidence raised a question of fact for the jury. The successor corporation acquired full and exclusive access, use and possession of all of the selling corporation’s plans and drawings, along with all of the selling corporation’s business records relating to the design, production and/or sale of its cambering machines. However, the purchasing company argued that the exception did not apply because the selling company remained a viable corporation and because there was a lack of commonality among key personnel in the predecessor and successor corporations. After reviewing the evidence presented, the court concluded that a genuine issue of material fact existed as to whether the estate could satisfy the continuation exception and therefore, the successor corporation’s motion for summary judgment on the basis of its successor liability defense was denied.

However, the court granted the successor corporation’s motion for summary judgment on the estate’s claim that the successor had an independent duty to warn the worker of the risks associated with use of the machine. It was undisputed that the successor corporation did not have any service agreements in place with the worker’s employer and that the worker’s death was the first such incident the successor had been made aware of involving a cambering machine. It was also undisputed that the successor was unaware of any alleged defect until after the worker’s death. The successor could not owe a duty to warn about a defect it did not know existed and thus, its motion for summary judgment on this claim was granted.

The case is No. CIV. 13-5016-JLV.

Attorneys: David A. Bradsky (Bradsky, Bradsky & Bradsky, PC) for Kenneth Klynsma. Heather Lammers Bogard (Costello Porter Hill Heisterkamp Bushnell & Carpenter) and Paul J. Politz (Taylor, Wellons, Politz & Duhe APLC) for Hydradyne, LLC. Gregory J. Erlandson (Bangs McCullen Law Firm) for T.J. Welding & Fabrication Co.

Companies: Hydradyne, LLC; T.J. Welding & Fabrication Co.

MainStory: TopStory DesignManufacturingNews SCLIssuesNews WarningsNews IndustrialCommercialEquipNews SouthDakotaNews

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