Depositors Insurance Company v. General Electric Company ( 2007 )


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  •                    United States Court of Appeals
    FOR THE EIGHTH CIRCUIT
    ___________
    No. 06-4141
    ___________
    Depositors Insurance Company;             *
    Brooke Miller,                            *
    *
    Plaintiffs/Appellants,      *
    * Appeal from the United States
    v.                                  * District Court for the
    * Southern District of Iowa.
    Wal-Mart Stores, Inc.; Walgreen           *
    Company,                                  *
    *
    Defendants,                 *
    *
    General Electric Company; Frank           *
    Fletcher Companies, LTD, doing            *
    business as Cheyenne Home                 *
    Furnishings and Cheyenne                  *
    Industries, Inc.,                         *
    *
    Defendants/Appellees.       *
    ___________
    Submitted: September 27, 2007
    Filed: November 6, 2007
    ___________
    Before LOKEN, Chief Judge, WOLLMAN and RILEY, Circuit Judges.
    ___________
    RILEY, Circuit Judge.
    The district court1 granted the motions for summary judgment of General
    Electric Co. (GE) and Frank Fletcher Cos., LTD, d/b/a Cheyenne Home Furnishings
    and Cheyenne Industries, Inc. (Fletcher) (collectively, the defendants2) and dismissed
    the claims of Depositors Insurance Co. (Depositors) and Brooke Miller (Miller)
    (collectively, the plaintiffs) based on product liability, implied warranty of
    merchantability, and negligence. We affirm.
    I.     BACKGROUND
    Miller owned a home in Des Moines, Iowa, and purchased homeowners
    insurance from Depositors. Miller bought an extension cord manufactured by GE and
    a lamp manufactured by Fletcher. Miller placed the Fletcher lamp on an end table
    near an upholstered chair, plugged the lamp into the GE extension cord, and plugged
    the extension cord into an electrical outlet.
    On October 9, 2004, a fire occurred at the Miller residence. The fire damaged
    the extension cord, lamp, end table, upholstered chair, and the house. The plaintiffs’
    expert, Todd Hartzler, could neither locate the point of origin of the fire nor reach a
    conclusion regarding the cause of the fire. Miller paid the $500 deductible on the
    insurance policy, Depositors paid $88,503.36 in benefits, and Miller assigned her
    subrogation interest to Depositors.
    The plaintiffs filed a complaint, alleging product liability, implied warranty of
    merchantability, and negligence claims. The plaintiffs maintained either the GE
    1
    The Honorable Harold D. Vietor, United States District Judge for the Southern
    District of Iowa.
    2
    The parties stipulated to the dismissal of Wal-Mart Stores, Inc. and Walgreen
    Company.
    -2-
    extension cord or the Fletcher lamp cord caused the fire. The defendants moved for
    summary judgment on all the claims. The district court granted summary judgment
    for the defendants. The plaintiffs appeal.
    II.    DISCUSSION
    We review de novo a grant of summary judgment. Libel v. Adventure Lands
    of Am., Inc., 
    482 F.3d 1028
    , 1033 (8th Cir. 2007). Federal Rule of Civil Procedure
    56(c) provides summary judgment “shall be rendered forthwith if the pleadings,
    depositions, answers to interrogatories, and admissions on file, together with the
    affidavits, if any, show that there is no genuine issue as to any material fact and that
    the moving party is entitled to a judgment as a matter of law.” To be a genuine issue
    of fact, the evidence must be such “that a reasonable jury could return a verdict for the
    nonmoving party.” Anderson v. Liberty Lobby, Inc., 
    477 U.S. 242
    , 248 (1986). To
    be a material fact, the factual issue must potentially “affect the outcome of the suit
    under the governing law.” 
    Id. “Rule 56(c)
    mandates the entry of summary judgment,
    after adequate time for discovery and upon motion, against a party who fails to make
    a showing sufficient to establish the existence of an element essential to that party’s
    case, and on which that party will bear the burden of proof at trial.” Celotex Corp. v.
    Catrett, 
    477 U.S. 317
    , 322 (1986).
    Because the federal courts have diversity jurisdiction over this case pursuant to
    28 U.S.C. § 1332, we apply the law of the State of Iowa. See HOK Sport, Inc. v. FC
    Des Moines, L.C., 
    495 F.3d 927
    , 934 (8th Cir. 2007).
    A.    Product Liability
    The plaintiffs asserted a manufacturing defect in either the GE extension cord
    or Fletcher lamp cord caused the fire. In Wright v. Brooke Group, Ltd., 
    652 N.W.2d 159
    (Iowa 2002), the Supreme Court of Iowa adopted the Product Restatement, which
    provides a product “contains a manufacturing defect when the product departs from
    its intended design even though all possible care was exercised in the preparation and
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    marketing of the product.” 
    Id. at 178;
    Restatement (Third) of Torts: Product Liability
    § 2(a) (1998). “[A] manufacturing defect is a departure from a product unit’s design
    specifications.” 
    Id. § 2
    cmt. c; see also Parish v. Icon Health & Fitness, Inc., 
    719 N.W.2d 540
    , 545 (Iowa 2006) (noting, in adopting the Product Restatement, the
    Supreme Court of Iowa also adopted the associated commentary). A departure from
    the intended design of a product cannot be determined without knowing the actual
    intended design of the product. Thus, under Iowa law, an essential element of any
    manufacturing defect claim is the intended design of the product. See 
    Wright, 652 N.W.2d at 178-79
    (citing “[a] manufacturing defect exists only where an item is
    substandard when compared to other identical units off of the assembly line” (quoting
    In re Temporomandibular Joint (TMJ) Implants Prods. Liab. Litig., 
    97 F.3d 1050
    ,
    1054 n.4 (8th Cir. 1996))). Here, the plaintiffs never offered any evidence showing
    (1) the intended design of either the extension or lamp cords or (2) how the
    manufacturing of these cords departed from the intended product designs. Therefore,
    the plaintiffs failed to make a showing sufficient to establish the existence of essential
    elements of the manufacturing defect claims. The district court properly granted
    summary judgment on the plaintiffs’ product liability claims.
    B.    Implied Warranty of Merchantability
    The plaintiffs also brought claims for breach of implied warranty of
    merchantability, arguing the extension and lamp cords were not fit for the ordinary
    purpose for which cords are used.3 Iowa Code section 554.2314 provides for an
    3
    The plaintiffs also argued the extension and lamp cords failed to conform to
    the defendants’ promises, however, the plaintiffs never identified any promises made
    by the defendants. See generally Iowa Code § 554.2314(2)(f) (providing the implied
    warranty of merchantability guarantees goods “conform to the promises or
    affirmations of fact made on the container or label if any”). “Mere allegations not
    supported with specific facts are insufficient to establish a material issue of fact and
    will not withstand a summary judgment motion.” Henthorn v. Capitol Commc’n, Inc.,
    
    359 F.3d 1021
    , 1026 (8th Cir. 2004).
    -4-
    implied warranty of merchantability.4          “[W]arranty liability under section
    554.2314(2)(c) requires proof of a product defect as defined in Products Restatement
    section 2.” 
    Wright, 652 N.W.2d at 182
    ; see also Restatement (Third) of Torts:
    Product Liability § 2(a) cmt. n (stating a manufacturing defect claim and an implied
    warranty of merchantability claim “rest on the same factual predicate” and thus “these
    two claims are duplicative and may not be pursued together in the same case”).
    Because the plaintiffs failed to make a showing sufficient to establish a manufacturing
    defect in either the extension or lamp cords, the district court properly granted
    summary judgment on the plaintiffs’ implied warranty of merchantability claims.
    C.    Negligence
    The plaintiffs asserted general negligence claims under the res ipsa loquitur
    doctrine. Res ipsa loquitur is a rule of evidence and a type of circumstantial evidence,
    which permits, but does not compel, an inference of negligence upon showing an
    injury “would not have occurred absent some unspecified but impliedly negligent act.”
    Sammons v. Smith, 
    353 N.W.2d 380
    , 385 (Iowa 1984); see also Brewster v. United
    States, 
    542 N.W.2d 524
    , 528-29 (Iowa 1996) (en banc). “Under Iowa law, res ipsa
    loquitur applies when ‘(1) the injury is caused by an instrumentality under the
    exclusive control of the defendant, and (2) the occurrence is such as in the ordinary
    course of things would not happen if reasonable care had been used.” 
    Brewster, 542 N.W.2d at 529
    (quoting Mastland, Inc. v. Evans Furniture, Inc., 
    498 N.W.2d 682
    , 686
    (Iowa 1993)).
    4
    Section 554.2314, in relevant part, provides:
    1. Unless excluded or modified (section 554.2316), a warranty that the
    goods shall be merchantable is implied in a contract for their sale if the
    seller is a merchant with respect to goods of that kind. . . .
    2. Goods to be merchantable must be at least such as . . .
    c. are fit for the ordinary purposes for which such goods are
    used.
    -5-
    Res ipsa loquitur depends upon the “defendant’s complete and exclusive control
    of the instrumentalities that cause the injury.” Oak Leaf Country Club, Inc. v. Wilson,
    
    257 N.W.2d 739
    , 744 (Iowa 1977) (quoting Eaves v. City of Ottumwa, 
    38 N.W.2d 761
    , 769 (Iowa 1949)). To satisfy the exclusive control requirement, “[t]he injury
    must either be traced to a specific instrumentality or cause for which the defendant
    was responsible, or it must be shown that the [defendant] was responsible for all
    reasonably probable causes to which the accident could be attributed.” Graber v. City
    of Ankeny, Iowa, 
    616 N.W.2d 633
    , 643 (Iowa 2000) (en banc) (quoting W. Page
    Keeton et al., Prosser and Keeton on the Law of Torts § 39, at 248 (5th ed. 1984)).
    The exclusive control must have occurred at the time of the negligent act.
    Weyerhaeuser Co. v. Thermogas Co., 
    620 N.W.2d 819
    , 832 (Iowa 2000) (en banc).
    The purpose of the exclusive control requirement is “‘to link the defendant with the
    probability, already established, that the accident was negligently caused.’” 
    Brewster, 542 N.W.2d at 528
    (quoting Prosser and Keeton on the Law of Torts § 39, at 248).
    “Failure to connect the defendant with the negligent event defeats the application of
    res ipsa loquitur.” 
    Id. at 528-29.
    “If it appears that two or more instrumentalities, only one of which was under
    defendant’s control, contributed to or may have contributed to the injury, the [res ipsa
    loquitur] doctrine cannot be invoked.”5 Humphrey v. Happy, 
    169 N.W.2d 565
    , 569
    5
    In support of this proposition, the district court cited to Highland Golf Club of
    Iowa Falls, Iowa v. Sinclair Refining Co., 
    59 F. Supp. 911
    , 917-18 (N.D. Iowa 1945),
    superseded on other grounds by statute Iowa Code ch. 668, as recognized in McGuire
    v. Davidson Mfg. Corp., 
    258 F. Supp. 2d 945
    , 953 (N.D. Iowa 2003). The plaintiffs
    argue the district court erred by citing to a superseded case.
    In Highland Golf Club of Iowa 
    Falls, 59 F. Supp. at 912-13
    , a golf club brought
    a general negligence claim under the res ipsa loquitur doctrine against a gasoline
    vendor. A fire occurred in the golf club’s garage while the gasoline vendor was
    delivering gasoline. The district court entered a directed verdict for the gasoline
    -6-
    (Iowa 1969) (quoting with approval 38 Am. Jur. Negligence § 300 (1941)). “‘Unless
    there is vicarious liability or shared control, the logical rule usually is applied, that the
    plaintiff does not make out a preponderant case against either of two defendants by
    showing merely that [the plaintiff] has been injured by the negligence of one or the
    other.’” Novak Heating & Air Conditioning v. Carrier Corp., 
    622 N.W.2d 495
    , 498
    (Iowa 2001) (en banc) (quoting Town of Reasnor v. Pyland Constr. Co., 
    229 N.W.2d 269
    , 272 (Iowa 1975)); see also Pastour v. Kolb Hartware, Inc., 
    173 N.W.2d 116
    , 126
    (Iowa 1969) (holding if multiple instruments controlled by different defendants caused
    the injury, res ipsa loquitur can only apply if the defendants “have been properly
    charged as joint tortfeasors or have been in joint control of the instrumentality or
    agency causing the injury, or where one was vicariously liable for the other’s
    vendor because “the situation lack[ed] the element of exclusive control of the
    instrumentalities which is necessary to give rise to the doctrine of res ipsa loquitur.”
    
    Id. at 918.
    The district court never concluded the golf club was negligent. 
    Id. at 919
    (recognizing “fires are frequent occurrences and in a great many cases without any
    negligence on the part of anyone”).
    In the discussion of the applicable law, the district court noted “[w]here the rule
    of res ipsa loquitur is applicable, this does not change the rule that the plaintiff must
    plead and prove his freedom from contributory negligence.” 
    Id. at 914.
    Before Iowa
    adopted the principles of comparative fault, “the doctrine of contributory negligence
    prohibited any party who caused the injury from recovering.” Jeffrey A. Stone, The
    Law of Contribution and Tort-Based Indemnity in Iowa, 55 Drake L. Rev. 113,
    116-17 (2006). The enactment of the Iowa Comparative Fault Act abolished the
    defense of contributory negligence, relieving the plaintiff from the obligation of
    pleading and proving freedom from contributory negligence. See Iowa Code ch. 668.
    Insofar as Highland Golf Club of Iowa Falls was decided based on the golf
    club’s contributory negligence, the Iowa Comparative Fault Act superseded the
    decision; however, the district court also decided Highland Golf Club of Iowa Falls
    based on the gasoline vendor’s lack of exclusive control over the instrumentalities
    causing the injury. The enactment of the Iowa Comparative Fault Act has not affected
    this interpretation of the case.
    -7-
    negligence” (quoting E. H. Schopler, Applicability of res ipsa loquitur in case of
    multiple defendants, 
    38 A.L.R. 2d 905
    , 906 (1954))).
    Here, the plaintiffs identify two instruments—the GE extension cord and the
    Fletcher lamp cord—that potentially could have caused the fire. The plaintiffs never
    specifically identify the instrument that caused the fire; rather, the plaintiffs proceed
    on the assumption that identifying two instruments that potentially could have caused
    the fire is a sufficient basis upon which to apply the res ipsa loquitur doctrine. The
    plaintiffs, however, are incorrect. We hold the plaintiffs’ alternative theories of the
    instrument that caused the fire precludes the application of the res ipsa loquitur
    doctrine. Again, “the plaintiff does not make out a preponderant case against either
    of two defendants by showing merely that [the plaintiff] has been injured by the
    negligence of one or the other.” Novak Heating & Air 
    Conditioning, 622 N.W.2d at 498
    (quoting Town of 
    Reasnor, 229 N.W.2d at 272
    ).
    Additionally, the plaintiffs never argued Fletcher and GE are vicariously liable
    or joint tortfeasors. Finally, GE’s control over the extension cord and Fletcher’s
    control over the lamp are independent acts of control over separate and distinct
    instruments. Cf. Town of 
    Reasnor, 229 N.W.2d at 272
    (holding two construction
    contractors had not shared control when one contractor completed its work before the
    other contractor began its work). Here, the plaintiffs alleged the defendants
    negligently manufactured the cords. Neither GE nor Fletcher shared control over the
    other’s manufacturing operation. The district court properly granted summary
    judgment on the plaintiffs’ general negligence claims.
    III.   CONCLUSION
    We affirm the judgment of the district court.
    ______________________________
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