Temporomandibular Joint (TMJ) Implant Recipients v. Dow Chemical Co. , 113 F.3d 1484 ( 1997 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 95-2886
___________
In re: Temporomandibular *
Joint (TMJ) Implants Products *
Liability Litigation *
________________________ *
*
Temporomandibular Joint (TMJ) *
Implant Recipients, * Appeal from the United States
* District Court for the
Appellants, * District of Minnesota.
*
v. *
*
The Dow Chemical Company, *
*
Appellees. *
___________
Submitted: June 14, 1996
Filed: May 16, 1997
___________
Before BOWMAN, JOHN R. GIBSON, and BEAM, Circuit Judges.
___________
BOWMAN, Circuit Judge.
This is a products liability matter. Plaintiffs, who are the
recipients of temporomandibular joint (TMJ) implants, prosthetic devices
used to correct TMJ disorders, seek to impose liability upon The Dow
Chemical Company (Dow Chemical) for injuries alleged to have been caused
by the implants. The pretrial proceedings in these various personal injury
actions were consolidated in the District of Minnesota by the Judicial
Panel on Multidistrict
Litigation pursuant to 28 U.S.C. § 1407 (1994). See In re
Temporomandibular Joint (TMJ) Implants Prods. Liab. Litig., 844 F. Supp.
1553, 1554-55 (J.P.M.L. 1994). Plaintiffs appeal the final order of the
1
District Court granting summary judgment in favor of Dow Chemical. We
affirm.
I.
The TMJ connects the upper and lower jaw. A TMJ implant is a device
that is surgically inserted to replace an improperly functioning TMJ.
Plaintiffs allege that their implants deteriorated after implantation,
causing, inter alia, surrounding jaw bone disintegration, serious
autoimmune responses, and severe head and neck pain.
Dow Corning Corporation (Dow Corning), together with its subsidiary,
Dow Corning Wright, manufactured and sold TMJ implants containing
silicone.2 Dow Chemical and Corning, Incorporated (Corning), each fifty
percent owners of Dow Corning’s stock, formed Dow Corning in 1943 to
participate in the organosilicon compound industry. Plaintiffs do not
allege that Dow Chemical ever manufactured, sold, or tested TMJ implants
or supplied any component parts of or substances used in such implants.
Instead, plaintiffs assert that Dow Chemical is liable because of its
1
The Honorable Paul A. Magnuson, Chief Judge, United States
District Court for the District of Minnesota.
2
Because Dow Corning has filed a petition for reorganization
under Chapter 11 of the Bankruptcy Code, it has not appeared in
these proceedings. All nonbreast implant claims pending against
Dow Corning have been transferred to the United States District
Court for the Eastern District of Michigan, where Dow Corning filed
its Chapter 11 petition. See Tort Claimants’ Comm. v. Dow Corning
Corp. (In re Dow Corning Corp.), 1996 WL 668567 (6th Cir. Nov. 18,
1996) (unpublished table decision reported at 103 F.3d 129).
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alleged involvement in the research, testing, and development of silicone
used in the TMJ implants.
Since Dow Corning’s inception, Dow Chemical has performed a number
of services for Dow Corning. Among Dow Chemical’s services were
approximately a dozen limited toxicology tests performed on a variety of
silicone compounds from 1943 through the early 1970s. None of the tests
was conducted to determine whether the specific compound tested could be
used safely as a medical implant.3
Three Dow Chemical scientists, including Dr. V.K. Rowe, published two
articles, one in 1948 and one in 1950, describing toxicological research
performed on various silicones (none of which are alleged to be present in
any TMJ implant). The 1948 article concluded that silicones as a group
have a very low order of toxicity. However, the article warned of dangers
associated with certain silicone compounds. Specific harmful effects
included
3
In fact, the only support found in the record for plaintiffs’
assertion that Dow Chemical ever tested in any way any silicone
compound actually used in any TMJ implant is a study published in
1972 by scientists at Dow Chemical. See Appellants’ App. at 289-
99. The study examined the effect of silicone injections on the
reproductive systems of female rats and concluded that a number of
the silicone compounds tested, including a low molecular weight
silicone known as D4, were biologically active. Plaintiffs attempt
to link D4 to silicone in TMJ implants by asserting that D4 serves
as a basic building block in all silicone implants. However, even
assuming the presence of D4 in TMJ implants, plaintiffs can point
to no testing by Dow Chemical that could possibly form the basis
for plaintiffs’ tort claims. By publishing the study highlighting
the dangers of D4, Dow Chemical obviously was not concealing the
potential dangers of this compound, and absent evidence of further
Dow Chemical studies concerning D4 or any other silicone compound
allegedly contained in any TMJ implant, plaintiffs cannot establish
an undertaking on the part of Dow Chemical to ensure the safety of
any TMJ implant. Furthermore, plaintiffs have not shown that Dow
Chemical knew that any of the specific silicone compounds tested
would be contained in any TMJ implant, or any other medical implant
for that matter.
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irritation, inflammation, edema, and necrosis. The 1950 article concluded
that no adverse effects were found in rats administered certain commercial
silicones in their diets.
In 1967, Dr. Rowe attended a meeting at Dow Corning discussing the
toxicology of various Dow Corning products, including Silastic® rubber
dental liner and dental impression material. The concept of a permanent
tooth implant was discussed. Before any long-term studies were to be
carried out, preliminary studies on animals were to be performed. There
is no indication that Dr. Rowe participated in this discussion or that TMJ
implants ever were discussed.
Dow Corning established its own toxicology department within Dow
Chemical’s facilities in 1968, hiring a former Dow Chemical employee to
head the department. In 1971, Dow Corning’s toxicology laboratory moved
into its own space in a Dow Corning building. Four years later, the two
companies signed an agreement giving Dow Corning the use of various Dow
Chemical trademarks and trade names. In return, Dow Chemical retained the
right to inspect Dow Corning’s products to protect the integrity of its
trademarks and trade names.
Plaintiffs sued both Dow Chemical and Corning for damages resulting
from implant-related injuries. The District Court granted summary judgment
in favor of both defendants in all of the consolidated cases, rejecting
plaintiffs’ theories of corporate control and direct liability. In re TMJ
Implants Prods. Liab. Litig., 880 F. Supp. 1311 (D. Minn. 1995). First,
plaintiffs claimed that the District Court should disregard Dow Corning’s
status as a separate corporate entity and allow a lawsuit against its
parent companies, Dow Chemical and Corning, for the alleged torts of Dow
Corning, or at least find the existence of a joint venture between Dow
Chemical and Corning. The court concluded as
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a matter of law that plaintiffs could not “pierce the corporate veil” to
reach Dow Chemical and Corning and that no joint venture in the legal sense
existed between Dow Chemical and Corning.4 See id. at 1315-16. Second,
plaintiffs claimed that Dow Chemical is directly liable under a variety of
theories, including fraud, aiding and abetting tortious conduct,
conspiracy, a trademark licensing theory, negligent performance of an
undertaking, violation of state consumer protection laws, and direct
participation in the alleged tortious activities of Dow Corning. The
District Court determined that no genuine issues of material fact existed
as to any of plaintiffs’ direct liability claims and that Dow Chemical was
entitled to judgment as a matter of law. See id. at 1322.
In this appeal, plaintiffs argue that the District Court prematurely
granted summary judgment. Plaintiffs’ contentions primarily concern the
relationship between this litigation and the consolidated breast implants
litigation in Alabama. In re Silicone Gel Breast Implants Prods. Liab.
Litig., 887 F. Supp. 1455 (N.D. Ala. 1995) [hereinafter In re Breast
Implants]. Plaintiffs also argue that based on the record there are
genuine issues of material fact which preclude a grant of summary judgment
on their claims of negligent performance of an undertaking, aiding and
abetting tortious conduct, fraudulent concealment and misrepresentation,
and conspiracy.
4
Plaintiffs do not appeal these corporate control rulings, and
they asserted direct liability claims against only Dow Chemical;
Corning thus is not a party to this appeal.
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II.
A transferee court in federal multidistrict proceedings has the
authority to enter dispositive orders terminating cases consolidated under
28 U.S.C. § 1407 (1994). See Temporomandibular Joint (TMJ) Implant
Recipients v. E.I. Du Pont De Nemours (In re Temporomandibular Joint (TMJ)
Implants Prods. Liab. Litig.), 97 F.3d 1050, 1055 (8th Cir. 1996)
[hereinafter E.I. Du Pont].
Federal law governs our review of whether the District Court
prematurely granted summary judgment. See, e.g., Wallace v. Dorsey
Trailers Southeast, Inc., 849 F.2d 341, 344 (8th Cir. 1988). The
substantive claims, on the other hand, are creatures of state law, and the
transferee court--and by extension this Court--ordinarily must apply the
state law that would have been applied in an individual case had the case
not been transferred for consolidation. See E.I. Du Pont, 97 F.3d at 1055.
Here, however, the parties have not informed the Court of any difference
in the applicable state laws, nor have they provided any choice-of-law
analysis. Instead, they have based their arguments on generally applicable
statements of the law, and have not disagreed as to the content of those
statements. Accordingly, we take these generally applicable statements of
substantive law as providing the legal standards that govern our review of
plaintiffs’ substantive claims. We apply, of course, the established
summary judgment principles, as did the District Court.
III.
We first address plaintiffs’ concerns about the timing of the summary
judgment. These concerns center around Dow Chemical’s use
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of In re Breast Implants. In 1993, the district court in In re Breast
Implants granted an interlocutory summary judgment to Dow Chemical in a
suit brought by the recipients of silicone gel breast implants. 837 F.
Supp. 1128, 1142 (N.D. Ala. 1993). Many of the factual and legal issues
in the breast implants litigation were similar, if not identical, to the
issues in the present TMJ implants litigation. Accordingly, plaintiffs in
the TMJ litigation were directed to the breast implants litigation
5
depository for most of the discovery sought, and discovery was to be
coordinated with discovery in the breast implants litigation. All
discovery was permitted only by leave of court. Not surprisingly, Dow
Chemical relied heavily on the holdings and reasoning of In re Breast
Implants to support its motion for summary judgment.
The District Court issued its order in the present consolidated TMJ
implants cases granting summary judgment to Dow Chemical on March 31, 1995,
but final judgment was not entered at that time. See In re TMJ Implants,
880 F. Supp. at 1322. On April 25, 1995, the court in In re Breast
Implants vacated its order granting summary judgment to Dow Chemical on the
plaintiffs’ direct liability claims based on evidence acquired subsequent
to the entry of that order. See In re Breast Implants, 887 F. Supp. at
1456. That court held that on the evidence then before it a jury could
find that Dow Chemical, as a consequence of its testing of silicone,
engaged in a negligent undertaking and therefore was directly liable to
recipients of silicone gel breast implants under the laws of at least some
states.6 Id. at 1460-62. In the present
5
The document depository was established by the court in the
breast implants litigation for litigants in any federal or state
case involving silicone implant product liability.
6
After concluding that summary judgment was improper as to the
negligent undertaking claim, the district court in In re Breast
Implants found it unnecessary to address plaintiffs’ other direct
liability theories. 887 F. Supp. at 1462.
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litigation, on June 13, 1995, the District Court denied plaintiffs’ motion
to vacate and deny summary judgment as to Dow Chemical and granted Dow
Chemical’s motion for the entry of final judgment.
Plaintiffs contend that the District Court abused its discretion in
declining to vacate its order granting summary judgment in this case.
Plaintiffs argue that before the court in In re Breast Implants vacated
summary judgment, Dow Chemical asserted that the factual and legal issues
surrounding Dow Chemical’s summary judgment motion in this case were
identical to those already adjudicated in its favor in the breast implants
litigation. Plaintiffs further argue that after summary judgment in the
breast implants litigation was vacated, Dow Chemical reversed direction,
claiming that In re Breast Implants should not affect the TMJ litigation
because breast implant silicone and TMJ implant silicone are different.
Moreover, plaintiffs contend that because of Dow Chemical’s reliance on the
breast implants litigation, Dow Chemical was able to avoid discovery in the
present case concerning its role in the research and development of
silicone, and it avoided discovery on the differences, if any, that exist
between breast implant silicone and TMJ implant silicone. Without this
discovery, plaintiffs argue, the grant of summary judgment was premature.
A trial court’s determination that a claim is ripe for summary
judgment is reviewed for abuse of discretion. See, e.g., Humphreys v.
Roche Biomedical Labs., Inc., 990 F.2d 1078, 1081 (8th Cir. 1993).
Discovery does not have to be completed before a court can grant summary
judgment, id. (citing Fed. R. Civ. P. 56), but summary judgment is proper
only after the nonmovant has had adequate time for discovery, see Celotex
Corp. v. Catrett, 477 U.S.
-8-
317, 322 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986).
Federal Rule of Civil Procedure 56(f) allows a party defending against a
summary judgment motion to request a court to postpone a decision until
completion of adequate discovery. If a party opposing a summary judgment
motion does not seek shelter under Rule 56(f) or otherwise ask for a
continuance, a court generally does not abuse its discretion in granting
summary judgment based on the record before it. See Wallace, 849 F.2d at
344 (holding that entry of summary judgment was not premature in view of
nonmovants failure to take advantage of Rule 56(f) or ask the court for any
kind of continuance); King v. Cooke, 26 F.3d 720, 726 (7th Cir. 1994)
(“[W]hen a party does not avail himself of relief under Rule 56(f), it is
generally not an abuse of discretion for the district court to rule on the
motion for summary judgment.”), cert. denied, 115 S. Ct. 1373 (1995).
In addressing plaintiffs’ contentions that the timing of the grant
of summary judgment was unfair, we note that plaintiffs mischaracterize Dow
Chemical’s position in the District Court and unduly minimize the role of
the District Court. In referring to the breast implants litigation, Dow
Chemical argued that the court should not discount the analysis in In re
Breast Implants merely because that case involved breast implants and this
case involved TMJ implants. Plaintiffs have turned this valid contention
on its head, reworking Dow Chemical’s argument to be that because this too
is a silicone implant case, the results must be the same. However, neither
plaintiffs nor Dow Chemical elected to rely solely on the decision in In
re Breast Implants; both parties marshalled evidence to support their
positions regarding Dow Chemical’s motion for summary judgment. Dow
Chemical simply analogized the breast implants litigation to the TMJ
implants litigation in support of its motion. This does not estop Dow
Chemical from pointing out distinctions between the breast implants case
and the present case.
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Furthermore, the District Court did not rely on the opinion in In re
Breast Implants as heavily as plaintiffs contend. The District Court
expressly relied on reasoning in In re Breast Implants only when discussing
the corporate control claims, see In re TMJ Implants, 880 F. Supp. at 1315,
with respect to which plaintiffs raise no issue in this appeal. In the
portion of the District Court’s opinion addressing plaintiffs’ direct
liability claims, the court concluded, after “[h]aving carefully reviewed
the arguments and evidence,” that no genuine issues of material fact exist
as to any of plaintiffs’ claims against Dow Chemical. Id. at 1316. The
court made an independent decision based on its own analysis of the record;
it did not treat the initial opinion in the breast implants litigation as
determinative of the summary judgment question in this case.
Moreover, neither before nor after the Alabama district court’s
reversal of field in the breast implants litigation did plaintiffs make use
of Federal Rule of Civil Procedure 56(f), which allows a party to request
a delay in granting summary judgment until completion of further discovery.
Not only did plaintiffs never file an affidavit pursuant to Rule 56(f),7
but also they
7
Plaintiffs’ Reply Brief states that Dow Chemical’s counsel
indicated on August 18, 1994 that filing a Rule 56(f) affidavit was
unnecessary. See Reply Br. at 5. Irrespective of this contention,
in a September 2, 1994 letter to the District Court (a copy of
which was sent to plaintiffs’ counsel), Dow Chemical unequivocally
stressed its desire to have plaintiffs file a Rule 56(f) motion.
See Reply App. at 8. Plaintiffs also contend that they did not
know that discovery on the type of silicone contained in TMJ
implants was necessary until Dow Chemical made this an issue in
attempting to distinguish In re Breast Implants, well after the
court’s September 30, 1994 deadline for filing Rule 56(f)
affidavits. However, as noted in the opening line of plaintiffs’
brief, “This case concerns the role of Dow Chemical . . . in the
design and testing of the silicone used in [TMJ] implants.”
Appellants’ Br. at 1. There being thousands of different silicone
compounds, each with varying characteristics, plaintiffs should
have known early in this litigation that it would be necessary to
specifically identify the type of silicone in TMJ implants and to
tie that type of silicone to testing performed by Dow Chemical and
not simply rest on the notion that silicone is silicone.
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never filed a motion for a continuance or to compel discovery.8 Because
plaintiffs failed to take appropriate action to delay the entry of summary
judgment and obtain additional discovery, the entry of summary judgment was
not premature and did not constitute an abuse of the District Court’s
discretion. See Humphreys, 990 F.2d at 1081 (finding no abuse of
discretion in court’s grant of summary judgment where party failed to file
any affidavit specifying why further discovery is necessary); Cassidy, Inc.
v. Hantz, 717 F.2d 1233, 1235 (8th Cir. 1983) (per curiam) (holding that
appellant cannot complain of inadequate opportunity for discovery where it
did not request a continuance to conduct further discovery or state by
affidavit why essential facts justifying opposition to summary judgment are
unavailable). Plaintiffs made a conscious gamble that their case as
presented was sufficient to avoid summary judgment and cannot now complain
of inadequate discovery. See Tr. of Hr’g on Mot. for Summ. J., Jan. 27,
1995, Appellants’ App. at 847 (Counsel for plaintiffs stated that
8
In a May 25, 1995 letter, plaintiffs asked the District Court
to wait on issuing a final ruling until plaintiffs’ counsel had
obtained certain Food and Drug Administration (FDA) documents.
Appellants’ App. at 897. While United States v. Birchem, 100 F.3d
607, 609 (8th Cir. 1996), indicates that asking for a delayed
ruling may suffice to preserve on appeal an argument of inadequate
opportunity to conduct discovery even absent a Rule 56(f)
affidavit, a court does not necessarily abuse its discretion by
granting summary judgment in the face of such a requested delay.
See Bryant v. Ford Motor Co., 886 F.2d 1526, 1534 (9th Cir. 1989)
(stating that Rule 56(f) affidavit is not always necessary to raise
discovery issue, but noting that the absence of a formal request
for a continuance is relevant as to whether a district court abuses
its discretion in ruling on a summary judgment motion without
waiting for further discovery), cert. denied, 493 U.S. 1076 (1990).
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“[Plaintiffs] are certainly not submitting a Rule 56(f) affidavit at this
time. I think we have more than substantial evidence to survive the
summary judgment motion.”); Tr. of Hr’g on Continuing Mot. for Summ. J.,
May 24, 1995, Appellants’ App. at 865 (Even after summary judgment in In
re Breast Implants was vacated and Dow Chemical explicitly raised a
distinction between silicone in TMJ implants and silicone in breast
implants, counsel for plaintiffs still insisted that she “[did not] want
to raise a discovery issue.”).
Finally, the only discovery plaintiffs explicitly sought before the
District Court was to rule on Dow Chemical’s motion for final judgment--FDA
documents pertaining to Dow Corning’s attempt to gain FDA approval for its
TMJ implant--is irrelevant to the direct liability claims against Dow
Chemical.9 In its May 25, 1995 letter to the District Court, plaintiffs
asserted that the FDA documents would demonstrate that the silicone in TMJ
implants is
9
While assertions in plaintiffs’ May 25, 1995 letter
concerning the existence of these FDA documents and their purported
contents are relevant as to whether summary judgment was
prematurely granted, the documents themselves were never before the
District Court. As a result, plaintiffs’ January 3, 1996 motion to
supplement the record on appeal with these FDA documents and a
Silastic® Mammary Prosthesis informational brochure is denied, and
these items will not be considered in addressing the merits of Dow
Chemical’s summary judgment motion. See Barry v. Barry, 78 F.3d
375, 379 (8th Cir. 1996) (noting that authority to supplement a
record is rarely exercised and represents a narrow exception to the
general rule that appellate courts consider only evidentiary
materials before the trial court at the time summary judgment is
granted).
Plaintiffs’ February 12, 1996 motion to supplement the record
on appeal with correspondence between the parties to this case and
the District Court is granted. See United States v. Wilson, 102
F.3d 968, 971 n.3 (8th Cir. 1996) (granting motion to supplement
the record on appeal to the extent that party seeks to supplement
the record with material submitted to the district court).
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equivalent to that contained in previously-marketed silicone products.
Even if this contention were correct, plaintiffs never have asserted that
the documents would show any contacts between Dow Chemical and Dow Corning
sufficient to justify finding Dow Chemical directly liable to plaintiffs;
thus, based on plaintiffs own assertions, these documents would not raise
a genuine issue of material fact to create a jury question on any of
plaintiffs’ claims, and the District Court did not abuse its discretion in
granting summary judgment without waiting for discovery of these
10
documents. See Anderson, 477 U.S. at 248 (“Only disputes over facts that
might affect the outcome of the suit under the governing law will properly
preclude the entry of summary judgment.”); United States v. Birchem, 100
F.3d 607, 610 (8th Cir. 1996) (noting that nonmovants’ complaints of
inadequate discovery were inconsequential where nonmovants failed to point
to any factual disputes that would preclude summary judgment).
We conclude plaintiffs have failed to show that the District Court
abused its discretion regarding the timing of its entry of summary judgment
for Dow Chemical.
10
Because the discovery sought in plaintiffs’ May 25, 1995
letter did not demonstrate how postponement of the summary judgment
ruling would enable plaintiffs to avoid summary judgment, the
letter could not serve as the functional equivalent of a Rule 56(f)
affidavit. See Humphreys, 990 F.2d at 1081 (stating that party
invoking Rule 56(f)’s protection must demonstrate how postponement
of ruling on a summary judgment motion will enable the nonmovant to
show the existence of a genuine issue of material fact sufficient
to avoid summary judgment). Therefore, we need not, and do not,
decide whether strict adherence to Rule 56(f)’s affidavit
requirement is necessary to preserve the argument on appeal that
summary judgment was prematurely granted.
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IV.
Plaintiffs argue that the record shows genuine issues of material
fact with respect to several of their direct liability claims, and that
summary judgment therefore should have been denied. This Court reviews de
novo the decision to grant summary judgment. E.I. Du Pont, 97 F.3d at
1055. Summary judgment is proper only when, viewing the evidence in the
light most favorable to the nonmoving party, the record presents “no
genuine issue as to any material fact and . . . the moving party is
entitled to a judgment as a matter of law.” Fed. R. Civ. P. 56(c); see
McCormack v. Citibank, N.A., 100 F.3d 532, 537 (8th Cir. 1996). After the
moving party points out the absence of evidence to support the nonmoving
party’s case, the nonmoving party “must advance specific facts to create
a genuine issue of material fact for trial.” Rolscreen Co. v. Pella
Prods., Inc., 64 F.3d 1202, 1211 (8th Cir. 1995); see Celotex, 477 U.S. at
323-25. A genuine issue of material fact exists if the evidence is
sufficient to allow a reasonable jury to return a verdict for the nonmoving
party. See Anderson, 477 U.S. at 248-49. However, the mere existence of
a scintilla of evidence in favor of the nonmoving party’s position is
insufficient to create a genuine issue of material fact. See Anderson, 477
U.S. at 252; Devine v. Stone, Leyton & Gershman, P.C., 100 F.3d 78, 81-82
(8th Cir. 1996), cert. denied, ___ U.S.L.W. ___ (U.S. May 12, 1997) (No.
96-1423); see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475
U.S. 574, 586 (1986) (explaining that nonmovant “must do more than simply
show that there is some metaphysical doubt as to the material facts”).
After adequate time for discovery and upon proper motion, a court must
enter summary judgment “against a party who fails to make a showing
sufficient to establish the existence of an element essential to
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that party’s case, and on which that party will bear the burden of proof
at trial.” Celotex, 477 U.S. at 322.
Having reviewed carefully the parties’ arguments and submissions, we
conclude that no genuine issues of material fact exist as to any of
plaintiffs’ theories for holding Dow Chemical directly liable for
plaintiffs’ injuries.
A.
Plaintiffs assert that Dow Chemical is liable under section 324A of
the Restatement (Second) of Torts for negligent performance of an
undertaking. Section 324A provides:
One who undertakes, gratuitously or for consideration, to
render services to another which he should recognize as
necessary for the protection of a third person or his
things, is subject to liability to the third person for
physical harm resulting from his failure to exercise
reasonable care to protect his undertaking, if
(a) his failure to exercise reasonable care increases the
risk of such harm, or
(b) he has undertaken to perform a duty owed by the other
to the third person, or
(c) the harm is suffered because of reliance of the other
or the third person upon the undertaking.
Restatement (Second) of Torts § 324A (1965). The District Court found that
summary judgment should be granted on this claim because there is no
evidence to show that Dow Chemical undertook to “‘render services to
another’ through its trademark agreements or through any other means.” See
In re TMJ Implants, 880 F. Supp. at 1322.
An actor’s specific undertaking of the services allegedly performed
without reasonable care is a threshold requirement to
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section 324A liability. See, e.g., Patentas v. United States, 687 F.2d
707, 716 (3d Cir. 1982) (“The foundation of [324A] is that the defendant
specifically has undertaken to perform the task that he or she is charged
with having performed negligently.”); Lather v. Berg, 519 N.E.2d 755, 766
(Ind. Ct. App. 1988) (recognizing that an actor must specifically undertake
to perform the task charged). The scope of this undertaking defines and
limits an actor’s duty under section 324A. See, e.g., Homer v. Pabst
Brewing Co., 806 F.2d 119, 121 (7th Cir. 1986). Accordingly, courts have
refused to impose liability under section 324A without a showing that the
defendant undertook a duty with respect to the specific product that caused
the injury. See Evans v. Liberty Mut. Ins. Co., 398 F.2d 665, 666-67 (3d
Cir. 1968) (finding that employee could not recover under section 324A
absent a showing that the defendant insurance carrier had undertaken to
inspect plaintiff’s employer’s entire plant or the particular machine
involved in the accident); Blessing v. United States, 447 F. Supp. 1160,
1189 (E.D. Pa. 1978) (same); Artiglio v. Corning Inc., 56 Cal. Rptr. 2d
877, 883 (Cal. Ct. App. 1996) (noting that courts have refused to impose
section 324A liability without a showing that defendant undertook
responsibility with respect to the specific product that caused the
injury), review granted and opinion superseded by 930 P.2d 399 (Cal. 1997),
and review limited by 932 P.2d 755 (Cal. 1997) (limiting review to
consideration of section 324A claim).11
The existence and nature of a legal duty are generally questions of
law. See, e.g., Homer, 806 F.2d at 121-23 (analyzing existence and scope
of duty under section 324A and holding that
11
We are aware of California Rules of Court 976(d) and 977(a),
which limit the citation of opinions superseded by a grant of
review by the California Supreme Court. However, because these
rules are not binding on this Court, we cite to Artiglio but note
its status in the California courts.
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defendant owed no duty as a matter of law); Smith v. Allendale Mut. Ins.
Co., 303 N.W.2d 702, 710 (Mich. 1981) (interpreting section 324A and
concluding that it is “for the court to determine what evidence is
minimally necessary to establish the elements of a relationship on which
tort liability may be premised”). However, at least one federal circuit
court of appeals construing section 324A has held that the existence and
scope of an undertaking, and thus the concomitant duty, are questions of
fact for a jury. See Pratt v. Liberty Mut. Ins. Co., 952 F.2d 667, 671 (2d
Cir. 1992). Regardless of whether the scope of a duty is deemed a question
of law or a question of fact, if in viewing the evidence in the light most
favorable to the plaintiff a reasonable jury could not find the existence
of a duty, a court may find the absence of a duty as a matter of law. See,
e.g., Andrew v. State, 682 A.2d 1387, 1392 (Vt. 1996) (granting summary
judgment for state when plaintiff failed to show a section 324A undertaking
as a matter of law).
To establish liability under section 324A, plaintiffs must prove that
Dow Chemical undertook a duty with respect to TMJ implants. Plaintiffs
argue that Dow Chemical assumed such a duty by undertaking to render
services to Dow Corning through its trademark agreements with Dow Corning
and through its silicone research and testing performed for Dow Corning and
that Dow Chemical should have recognized that these services were necessary
for the protection of plaintiffs. Plaintiffs assert that the trademark
agreements provided that Dow Chemical could examine the quality of Dow
Corning’s products as a condition for the use of Dow Chemical’s trademarks
and trade names. Also, plaintiffs contend that Dow Chemical performed
substantial silicone research and testing, at Dow Corning’s request, that
Dow Corning did not and could not perform. Through these endeavors,
plaintiffs argue, Dow Chemical undertook at least part of Dow Corning’s
duty to ensure the safety of Dow Corning’s TMJ implants.
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The record, however, contains no evidence to show that Dow Chemical
undertook to render services to Dow Corning through its trademark
agreements. A standard trademark agreement, in and of itself, does not
establish an affirmative duty to inspect that could result in tort
liability to third parties, see Mini Maid Servs. Co. v. Maid Brigade Sys.,
Inc., 967 F.2d 1516, 1520 (11th Cir. 1992) (asserting that “the licensor’s
duty to control a licensee’s use of the licensor’s own trademark cannot be
blindly converted into a duty to prevent a licensee’s misuse of another
party’s trademark”); In re Breast Implants, 887 F. Supp. at 1461, and
nothing in the record suggests that these are other than standard trademark
agreements. Plaintiffs can point to no evidence that Dow Chemical in fact
inspected any Dow Corning product or provided any services to Dow Corning
pursuant to these agreements. These agreements can only be viewed, then,
as a vehicle for Dow Chemical to protect its intellectual property rights,
and thus they do not represent an undertaking on the part of Dow Chemical
to render services to another. Accordingly, these agreements do not
trigger section 324A. See Roberson v. United States, 382 F.2d 714, 721
(9th Cir. 1967) (stating that actions solely to protect a defendant’s own
interests are not a basis for section 324A liability).
The silicone research allegedly performed by Dow Chemical at the
request of Dow Corning also does not demonstrate an undertaking sufficient
to impose liability on Dow Chemical under section 324A. For section 324A
liability to attach, Dow Chemical must have specifically undertaken the
task of ensuring the safety of Dow Corning’s TMJ implants or of ensuring
the safety of Dow Corning’s entire array of silicone products. See
Blessing, 447 F. Supp. at 1189 (recognizing that liability attaches only
when defendant charged with negligent inspection undertakes to inspect the
specific device causing the injury or the entire physical plant, of
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which the specific device is a part); cf. Klein v. Council of Chem.
Ass’ns., 587 F. Supp. 213, 224 (E.D. Pa. 1984) (granting defendant’s motion
to dismiss because by failing to identify any specific product that caused
the injury, plaintiffs could not allege which product defendant tested and
negligently failed to warn plaintiffs about). Plaintiffs contend that Dow
Chemical undertook a duty with respect to all of Dow Corning’s silicone
products, but the record shows that Dow Chemical never tested the use of
silicone in any medical implants and that Dow Chemical never was informed
that any of the silicones it tested would be used in medical implants.
Thus, examining the evidence in the light most favorable to plaintiffs, Dow
Chemical’s silicone research cannot form the basis of a section 324A
undertaking for the protection of plaintiffs. See Artiglio, 56 Cal. Rptr.
2d at 884 (concluding that with an undisputed record that Dow Chemical did
not test the safety of breast implants, “there is no basis upon which a
reasonable inference can be drawn that Dow [Chemical] . . . in fact
undertook to protect the eventual recipients of Dow Corning’s products”).
Plaintiffs can point only to Dow Chemical’s performance of
approximately a dozen tests involving silicone (but not its use in medical
implants) performed over four decades at the request of Dow Corning, a 1967
meeting attended by a Dow Chemical employee in which the idea of a tooth
implant was discussed, a 1948 and a 1950 article published by three Dow
Chemical scientists discussing toxicological research on various
12
silicones, and a trademark
12
Plaintiffs contend that the 1948 article spawned the medical
implant industry through its assertion that silicones are inert.
The article, however, did not make such a broad assertion. The
article concluded that “silicones . . . as a class are very low in
toxicity,” Appellants’ App. at 428 (emphasis added), but
specifically mentioned dangers associated with some of the
silicones tested, Appellants’ App. at 421-23. To find an
undertaking based on this 1948 article would stretch the parameters
of section 324A to impermissible bounds. Scientists engaged in
preliminary research would be required to forever update their
research, familiarize themselves with all the subsequent and
previously inconceivable applications of their research, or face
tort liability (here, almost fifty years after completion of the
research). See Artiglio, 56 Cal. Rptr. 2d at 885 (rejecting a
similar argument in breast implants litigation “because researchers
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agreement allowing Dow Chemical to inspect the quality of Dow Corning’s
products. However, these Dow Chemical actions and Dow Corning’s
purportedly inadequate laboratory facilities are insufficient to establish
an undertaking of such breadth and magnitude as to create a duty on the
part Dow Chemical to ensure the safety of all of Dow Corning’s silicone
products. See In re New York State Silicone Breast Implant Litig., 632
N.Y.S.2d 953, 956-57 (Sup. Ct. 1995) (remarking that if court were to hold
that Dow Chemical assumed a duty of care to all potential consumers of
silicone products, “the duty imposed on Dow Chemical would be indeterminate
and infinite”), aff’d, 642 N.Y.S.2d 681 (App. Div.), appeal dismissed, 676
N.E.2d 493 (1996).
Absent the threshold requirement of a specific undertaking of the
services that form the basis for Dow Chemical’s alleged duty under section
324A, plaintiffs’ claim must fail, and we need not consider the remaining
aspects of section 324A liability. The District Court did not err in
granting summary judgment to Dow Chemical on plaintiffs’ negligent
undertaking claim.
B.
Plaintiffs also advance the theory that Dow Chemical is liable for
aiding and abetting Dow Corning’s tortious conduct under Restatement
(Second) of Torts § 876(b) (1979). Secondary liability
would have no practical means of ascertaining the scope of their
liability or making rational decisions regarding their research
undertakings”).
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under section 876(b) attaches when one actor “knows that the other’s
conduct constitutes a breach of duty and gives substantial assistance or
encouragement to the other so to conduct himself.” Courts have recognized
three basic requirements for aiding and abetting liability: (1) the primary
actor must commit a wrongful act that causes an injury; (2) the aider and
abettor must be generally aware of his role in the overall wrongful
activity at the time assistance is provided; and (3) the aider and abettor
must knowingly and substantially assist the wrongful act. See, e.g.,
Halberstam v. Welch, 705 F.2d 472, 477 (D.C. Cir. 1983).
In analyzing the present case under the standard outlined above, we
assume, as the District Court did, that plaintiffs can establish a wrongful
act on the part of Dow Corning. See In re TMJ Implants, 880 F. Supp. at
1319. We evaluate the second and third requirements in tandem--the
stronger the evidence of Dow Chemical’s general awareness of the alleged
tortious activity, the less evidence of Dow Chemical’s substantial
assistance is required, and the stronger the evidence of substantial
assistance, the less evidence of general awareness is required. See Metge
v. Baehler, 762 F.2d 621, 624 (8th Cir. 1985), cert. denied, 474 U.S. 1057,
1072 (1986). In determining what constitutes “substantial assistance,” the
comments to section 876 of the Restatement provides a list of five factors:
“the nature of the act encouraged, the amount of assistance given by the
defendant, his presence or absence at the time of the tort, his relation
to the other and his state of mind.” Restatement (Second) of Torts
§ 876(b), cmt. d. (1979). Additionally, the court in Halberstam provided
a sixth factor, the duration of the assistance provided. See Halberstam,
705 F.2d at 484. Finally, the alleged substantial assistance must be the
proximate cause of plaintiffs’ harm. See Metge, 762 F.2d at 624.
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Applying the foregoing legal standards to this case, the second
requirement of section 876(b) clearly is not satisfied. The record is
silent as to Dow Chemical’s general awareness of both the hazards
associated with TMJ implants and its supposed role in assisting Dow
Corning’s tortious conduct at the times the alleged assistance was
provided. Plaintiffs contend that the knowledge requirement is satisfied
by the transfers of various employees between Dow Chemical and Dow Corning
and by the sale of silicone products by Dow Chemical subsidiaries.
However, there is no indication that any information regarding the dangers
of TMJ implants or any silicone implants was ever disseminated to Dow
Chemical. Thus, plaintiffs have not established a genuine issue of
material fact regarding Dow Chemical’s general awareness of the dangers of
TMJ implants. Cf. Anguiano v. E.I. Du Pont de Nemours & Co., 44 F.3d 806,
812 (9th Cir. 1995) (affirming summary judgment for defendant manufacturer
of TMJ implant component on strict liability and negligent failure to warn
claims because plaintiffs failed to raise genuine issue of fact with
respect to defendant’s knowledge of the hazards associated with TMJ
implants even though defendant knew of component’s use, the problems with
this component in another load-bearing joint, and apprehension of implant’s
use by some practitioners).
The third aiding and abetting requirement is also unsatisfied. The
record does not indicate that Dow Chemical either knew of or substantially
assisted Dow Corning’s alleged tortious activity. See Ezzone v. Riccardi,
525 N.W.2d 388, 398 (Iowa 1994) (stating that aiding and abetting liability
cannot attach unless the primary party commits a wrong, the aider knows of
the wrong, and the aider substantially assists the achievement of the
primary violation), cert. denied, 115 S. Ct. 1958 (1995); National
Westminster Bank v. Weksel, 511 N.Y.S.2d 626, 630 (App. Div.) (noting that
plaintiff must establish that alleged aider and abettor acted with
intention
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of advancing the tortious activity), appeal denied, 513 N.E.2d 1307 (1987).
An analysis of the Restatement’s substantial assistance factors
supports this conclusion. First, we look at the nature of the act
encouraged and analyze the import of Dow Chemical’s aid. The record shows
that Dow Corning designed, manufactured, and sold the TMJ implants on its
own. Dow Corning was not “heavily dependent” on Dow Chemical in this
endeavor. Cf. Halberstam, 705 F.2d at 488. Next, we examine the amount
of assistance. A dozen random tests on silicone (none concerning its use
for human implantation), use of some Dow Chemical facilities, attendance
at a meeting in which the idea for a tooth implant was raised, and two
articles (published nearly fifty years ago) on the toxicity of silicones
is not significant assistance, especially when compared to the extensive
efforts necessary to bring the idea for a TMJ implant to fruition. The
third factor, the defendant’s absence or presence at the time of the tort,
indicates that although Dow Corning and Dow Chemical shared facilities
during much of the period in question, there is no evidence that Dow
Chemical knew of the testing or production of TMJ implants so as to be
present during the tort’s supposed commission. Dow Chemical’s relation to
Dow Corning is the fourth factor. As Dow Corning’s parent, Dow Chemical
obviously wants to be supportive; however, this generic desire to support,
without more, is not sufficient to form the basis for aiding and abetting
liability. Cf. id. at 488 (cautioning against overemphasis of relationship
between defendant and tortfeasor, who were live-in companions, and noting
uneasiness with finding civil liability on the basis of normal spousal
support activities). The fifth factor is Dow Chemical’s state of mind.
There is no indication that Dow Chemical’s actions were knowingly done for
the purpose of assisting the design, production, or sale of TMJ implants,
much less that Dow Chemical was “one in spirit
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with” the alleged tortfeasor, Dow Corning. Id. at 484. The sixth factor
applied by the court in Halberstam was the duration of the assistance
provided. Despite contacts between Dow Corning and Dow Chemical extending
over four decades, evidence of any assistance by Dow Chemical concerning
TMJ implants is nonexistent. See id. The record is barren of evidence
from which a reasonable jury could find that Dow Chemical provided
substantial assistance to Dow Corning’s alleged tortious activity.
Because there is no genuine issue of material fact to create a jury
question on plaintiffs’ aiding and abetting tortious conduct claim,
plaintiffs’ claim must fail. The District Court’s grant of summary
judgment on this claim must be sustained.
C.
Plaintiffs contend that Dow Chemical is liable for material
misrepresentations and omissions concerning the safety of silicone.
Plaintiffs assert two fraud-based claims: (1) fraudulent concealment, based
upon Dow Chemical’s alleged duty to plaintiffs to correct its prior
representations concerning the safety of silicone after discovering that
silicone presented a health risk; and (2) fraudulent misrepresentation,
based upon Dow Chemical’s representations concerning the appropriateness
of silicone use in medical implants after learning of silicone’s health
risks.
A fraudulent concealment claim requires:
(1) Deliberate concealment by the defendant of a material
past or present fact, or silence in the face of a duty to
speak;
(2) That the defendant acted with scienter;
(3) An intent to induce plaintiff’s reliance upon the
concealment;
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(4) Causation; and
(5) Damages resulting from the concealment.
Nicolet, Inc. v. Nutt, 525 A.2d 146, 149 (Del. 1987). Plaintiffs cannot
establish the first element of a fraudulent concealment claim. Plaintiffs
allege that a duty to speak on the part of Dow Chemical arose because Dow
Chemical published two articles asserting the inertness of silicone and
subsequently learned that certain silicone polymers were not inert.
However, absent any relationship between plaintiffs and Dow Chemical, there
can be no duty to speak. See Moore v. Fenex, Inc., 809 F.2d 297, 303 n.2
(6th Cir.) (stating that court is aware of no case finding liability for
fraudulent nondisclosure absent direct dealing with plaintiff), cert.
denied, 483 U.S. 1006 (1987); Magna Bank v. Jameson, 604 N.E.2d 541, 544
(Ill. App. Ct. 1992) (asserting that “[t]here is no duty to speak absent
a fiduciary or other legal relationship between the parties”), appeal
denied, 612 N.E.2d 514 (Ill. 1993) (table); cf. Restatement (Second) of
Torts, § 551(2)(c) (providing that a party to a business transaction is
under a duty to disclose subsequently acquired information that will make
untrue or misleading an earlier representation that was true or believed
true when made). Furthermore, there was nothing for Dow Chemical to
correct. The articles in question state that silicones as a class are
inert, but do not include the broad assertion that all silicones are inert.
Additionally, plaintiffs can point to no evidence of active concealment or
suppression of information relating to silicone implants on the part of Dow
Chemical. Because plaintiffs did not put forth evidence necessary to
satisfy the first element of a fraudulent concealment claim, we need not
go through the remaining elements. See Celotex, 477 U.S. at 322
(explaining that nonmovants must establish all essential elements of cause
of action on which they bear the burden of proof at trial in order to avoid
summary judgment); Forbes v. Par Ten Group, Inc.,
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394 S.E.2d 643, 647 (N.C. Ct. App. 1990) (requiring that genuine issue of
material fact must exist as to each element of fraud in order to avoid
summary judgment), review denied, 402 S.E.2d 824 (N.C. 1991).
Plaintiffs’ fraudulent misrepresentation claim also must fail. A
viable fraudulent misrepresentation claim requires showing that:
(1) [a] representation was made;
(2) the representation was false;
(3) when the representation was made, it was known to be
false or made recklessly without knowledge of its truth and
as a positive assertion;
(4) the representation was made with the intention that
it would be relied upon;
(5) there was reliance upon the representation; and
(6) damage occurred as a result.
Citizens Nat’l Bank v. Kennedy and Coe, 441 N.W.2d 180, 182 (Neb. 1989).
Plaintiffs contend that after learning that some silicones were not
physiologically inert, Dow Chemical continued to assert the safety and
utility of silicone in medical implants. These contentions, however, are
entirely without support in the record. Without evidence of a false
representation, the misrepresentation claim cannot succeed, and further
analysis of this claim is unnecessary. See Celotex, 477 U.S. at 322 (same
as above); Forbes, 394 S.E.2d at 647 (same as above).
Summary judgment was correctly granted on plaintiffs’ fraud claims.
D.
Finally, plaintiffs allege that Dow Chemical conspired with Dow
Corning to conceal and misrepresent the dangers of implanted
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silicone. To establish a civil conspiracy, plaintiffs must show five
elements: (1) two or more persons; (2) an object to be accomplished; (3)
a meeting of the minds on the object or course of action to be taken; (4)
the commission of one or more unlawful overt acts; and (5) damages as the
proximate result of the conspiracy. See, e.g., State ex rel. Mays v.
Ridenhour, 811 P.2d 1220, 1226 (Kan. 1991); Massey v. Armco Steel Co., 652
S.W.2d 932, 934 (Tex. 1983). Without evidence of specific facts tending
to show an agreement or a “meeting of the minds” and concerted action, a
plaintiff seeking to show a civil conspiracy cannot survive a defendant’s
summary judgment motion. See, e.g., Anderson v. Douglas County, 4 F.3d
574, 578 (8th Cir. 1993), cert. denied, 510 U.S. 1113 (1994); Mike Pratt
& Sons, Inc. v. Metalcraft, Inc., 383 N.W.2d 758, 763 (Neb. 1986) (stating
that plaintiff must prove existence of agreement between two or more
persons to inflict an injury upon or wrong against another).
Plaintiffs have not presented evidence sufficient to create a genuine
issue of material fact on their civil conspiracy claim. As already
detailed, there is no evidence that Dow Chemical knew what type of silicone
was used in TMJ implants or the dangers associated with this silicone, much
less that Dow Chemical agreed with Dow Corning to conceal the hazards of
the silicone in TMJ implants. Similarly, plaintiffs offer only pure
speculation, but no evidence, of a broader conspiracy encompassing all
silicone products. See Anderson, 4 F.3d at 578 (noting that conclusory
allegations are insufficient to prove conspiracy). While plaintiffs assert
that Dow Chemical and Dow Corning conspired to selectively publish only
favorable silicone test results, the research cited discusses both
beneficial and potentially harmful properties of the silicones studied, and
plaintiffs have made no showing that any of the research done by Dow
Chemical involved the suitability of silicone for human implantation. On
the basis of plaintiffs’ evidence, no
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reasonable trier of fact could conclude that Dow Chemical conspired with
Dow Corning to misrepresent or conceal the dangers of silicone in medical
implants. Here again, summary judgment was correctly granted in favor of
Dow Chemical.
V.
The District Court’s grant of summary judgment in favor of Dow
Chemical is affirmed.
A true copy.
Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT
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