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From Products Liability Law Daily, November 5, 2014

Rejection of stainless steel tubing class action alleging possibility of lightning strike fires affirmed on appeal

By Susan Lasser, J.D.

The dismissal of an action brought by a homeowner who alleged design, manufacturing, and warning defect claims sounding in both strict liability and negligence against the manufacturer of natural gas tubing because of a lack of standing was affirmed by the U.S. Court of Appeals for the First Circuit. The federal district court in Massachusetts had dismissed the homeowner’s case for lack of standing because the homeowner’s injury—vulnerability to failure after lightning strikes—was too speculative. Although the First Circuit did not hold that increased risk of harm from product vulnerability to lightning strikes could never give rise to standing, the court ruled that the homeowner, who although he conceded that the gas tubing product met applicable regulatory standards that specifically addressed the risk of lightning strikes, failed to allege either sufficient facts to assess the probability of future injury or instances of actual damage in which the cause of damage was clear. The appellate court determined that the alleged risk of harm was too speculative to give rise to a case or controversy (Kerin v. Titeflex Corp., November 4, 2014, Lynch, S.).

Background. Homeowner Tim Kerin’s house in Florida had a corrugated stainless steel tubing (CSST) manufactured by Titeflex Corporation t/a Gastite (Titeflex) installed to provide gas for Kerin’s outdoor firepit. His complaint purported to bring a class action against Titeflex, the manufacturer of the Gastite® CSST system, for an alleged product defect. He brought the claim under diversity jurisdiction in Massachusetts, where Titeflex is located.

CSST was introduced in the 1980s, is used in home and commercial structures throughout the country, and has been discovered to sometimes fail when exposed to “electrical insult,” such as lightning. Both direct and indirect lightning strikes can cause an electrical arc that can puncture CSST, igniting the natural gas within the tubing.

The homeowner alleged that the risks of CSST were “well-established;” that “experts” had recommended remedies that included complete removal; that 141 fires involving lightning and CSST had been reported in the United States as of August 2011; and that Titeflex had been aware of the risks created by its product “since at least 2004.” His complaint asserted four causes of action under Massachusetts law, each based on allegations of Gastite CSST’s vulnerability to lightning strikes—strict liability for design and manufacturing defects, negligence in designing and failing to test the product, and negligence and strict liability in failing to warn. Kerin did not allege that the vulnerability of his home’s CSST to lightning strikes manifested in any actual harm. The damages he sought could be measured as his overpayment or as the cost of remedying the safety issue.

The federal district court dismissed his case for lack of standing (see Products Liability Law Daily’s analysis from January 9, 2014). The court reasoned that the conjecture of the alleged injury was “too attenuated,” requiring both a lightning strike and one that effected a puncture in the CSST. The court also concluded that even if Kerin had standing, he failed to state a claim because he failed to allege “an applicable standard against which [Titeflex’s] due care could be measured” as required to claim economic injury from a defective product under Massachusetts law.

Dismissal upheld. In affirming the dismissal of the homeowner’s products liability case, which concerned the question of standing based on a theory of enhanced risk of future injury, the court of appeals did not adopt the lower court’s reasoning to the extent that the lower court relied on the proposition that lightning strikes presented a speculative risk and remote possibilities which were insufficient for injury in fact. The appellate court conceded that the “law of probabilistic standing is evolving” and that “it is conceivable that product vulnerability to lightning might, in some circumstances, constitute injury.” The court rather based its dismissal on the homeowner’s failure to allege risk sufficient to find injury.

Standing based on enhanced risk of injury. The court noted that to satisfy Article III standing, a plaintiff must sufficiently plead injury in fact (an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical), traceability, and redressability. The homeowner’s case, claiming standing based on risk, potentially would involve two injuries: (1) a possible future injury that may or may not happen (i.e., the harm threatened); and (2) a present injury that is the cost or inconvenience created by the increased risk of the initially alleged future injury. The court of appeals stated that such cases required caution because although one of the alleged injuries is present, satisfying imminence, the injury could still be speculative. The court explained that cases claiming standing based on risk fall into at least two categories—in the first, the present injury is linked to a statute or regulation or standard of conduct that allegedly has been or will soon be violated; and in the second, the present injury has not been identified and so is entirely dependent on the alleged risk of future injury. The appellate court found that the homeowner’s case fell in the latter category; and although he argued that his injury was one recognized under Massachusetts law governing “dangerously defective product[s],” he conceded that the CSST product in the case did not violate any applicable regulatory standard, which is required to state a claim for a dangerously defective product in the absence of actual damage. According to the First Circuit, the homeowner’s purported present injury—“overpayment” for a defective product and the cost of replacement—was completely “dependent on an unsupported conclusion that the CSST [was] defective, coupled with a speculative risk of future injury,” i.e., a fire resulting from a lightning strike.

Enhanced risk from lightning strikes. The court concluded that the homeowner failed to meet his burden of pleading that the risk of CSST causing a lightning fire in his home was not a remote possibility. While the court agreed with the homeowner that the risk of harm, if actualized, could be severe, it noted that whether a risk is speculative also depended on the chances that the risked harm would occur. The homeowner failed to allege facts sufficient to even calculate or estimate the risk, the court said and cited the example of the reported 141 fires involving lightning and CSST. The court observed that the homeowner did not allege information that would assist in making sense of the statistic such as the frequency of lightning strikes, the proportion of homes struck by lightning, or the likelihood of lightning fires in homes without CSST. Moreover, to the extent that he did cite numbers, they suggested a very low probability in the court’s estimation. In addition, the court found that even when the homeowner alleged that there had been actual damage, it was unclear that CSST was the source of that damage. To the appellate court, this was the point that distinguished the homeowner’s case from other cases in which courts found enhanced risk from product defects sufficient for standing.

Thus, the court affirmed the dismissal of the homeowner’s complaint in light of his failure to allege adequately either facts sufficient to assess the likelihood of future injury or instances of actual damage in which the cause was clear. The court found that the alleged risk of harm was too speculative to give rise to a case or controversy.

The case number is 14-1130.

Attorneys: Kevin Thomas Peters (Arrowood Peters LLP) for Tim Kerin. Charles B. Casper (Montgomery McCracken Walker Rhoads LLP) and Jodi Kim Miller (Bulkley Richardson & Gelinas LLP) for Titeflex Corp.

Companies: Titeflex Corp.

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