Opinion
6:20-cv-00133-MK
11-14-2022
FRANKLIN CALDWELL, Plaintiff, v. VOXX ELECTRONIC CORPORATION, a Delaware Corporation; ROCKFORD CORPORATION, an Arizona Corporation; CHRIS' RECOVERY SHOP, LLC, a Washington Corporation, CRIMESTOPPER SECURITY PRODUCTS, INC., a California Corporation; KEYSTONE AUTOMOTIVE INDUSTRIES, INC., a California Corporation; and KEYSTONE AUTOMOTIVE OPERATIONS, INC., a Pennsylvania Corporation; Defendants. CHRIS' RECOVERY SHOP, LLC, a Washington Corporation, Third-Party Plaintiff, v. COTTAGE GROVE CHEVROLET, INC., an Oregon Corporation, Third-Party Defendant.
FINDINGS AND RECOMMENDATION
MUSTAFA T. KASUBHAI (He / Him) United States Magistrate Judge
Third-Party Plaintiff Chris' Recovery Shop LLC (“Third-Party Plaintiff”) filed a personal injury action alleging Third-Party Defendant Cottage Grove Chevrolet, Inc. (“Third-Party Defendant”) is at least partially responsible for Plaintiff Franklin Caldwell's (“Plaintiff”) injuries under theories of strict product liability and negligence. See Am. Third-Party Compl., ECF No. 115. Third-Party Defendant now moves for summary judgment, which Third-Party Plaintiff opposed. Third-Party Def. Mot. for Summ. J. 3, ECF No. 84; Third-Party Def. Opp'n, ECF No. 88. For the reasons that follow, Third-Party Defendant's motion for summary judgment should be GRANTED as to Third-Party Plaintiff's strict product liability claim. Third-Party Defendant's motion for summary judgment should be DENIED as to Third-Party Plaintiff's remaining negligence claim.
BACKGROUND
Gerald Russell purchased a 2013 GMC Sierra (the “Truck”) as a new vehicle. Wess Decl., ¶ 2, Ex. A (“Russell Dep”), 8:2-4, ECF No. 85. The Truck as purchased did not have any type of seat heating feature. Id. at 15:6-24. As Gerald Russell desired a seat heater, he reached out to Third-Party Plaintiff for the purchase and installation of an after-market seat heater kit. Id. at 16:5-17:24; 19:1-4. In December of 2013, Third-Party Plaintiff purchased and installed the seat heater kit in the Truck. Id. at 19:5-14; 21:3-7. Gerald Russell sold the Truck the following summer, in mid-2014. Id. at 31:15-18.
In 2018, Third-Party Defendant purchased, inspected, and put the Truck for sale on their lot. Nomie Decl., Ex. 1, (“Lefler Dep.”), 9:4-24; 10:9-13, ECF No. 88-1. Third-Party Defendant's standard inspection process included an inspection of seat heaters regardless of whether they were factory installed or aftermarket. Id. at 19:13-25; 20:1-4; 41:21-25. This standard inspection process involved turning the seat heater on, using an infrared gun to determine if it warmed up, and test driving the vehicle for a six-mile loop with the seat heater on. Id. at 19:19-22; 20:1; 22:16-19; 37:21-24. Third-Party Defendant admits that it inspected the Truck but does not know what specific process it used to test the seat heaters. Nomie Decl., Ex. 2 (“Inspection Form”), ECF No. 88-1; see also Lefler Dep., 38:20-25; 39:1-14; 19:16-19; 22:25; 23:1-2; 40:3-8.
On October 13, 2018, Plaintiff purchased the Truck as a used vehicle from Third-Party Defendant. Second Am. Compl. (“SAC”) ¶ 9, ECF No. 61. Plaintiff purchased the Truck from Third-Party Defendant “as is.” Wess Decl., ¶3, Ex. B Caldwell Dep., 27:12-13; 33:7-11, ECF No. 85. Plaintiff has paraplegia and was in a wheelchair when purchasing the Truck. Nomie Decl., Ex. 3 (“Burnett Dep.”), 14:8-13, ECF No. 88-1. Plaintiff has reduced sensation in his buttocks and legs. SAC ¶ 13, ECF No. 61. Third-Party Defendant's salesperson, Nicholas Burnett, did not tell Plaintiff the Truck had a seat heater. Nomie Decl., Ex. 3 (“Burnett Dep.”), 20:9-15, ECF No. 88-1. However, after the sale was completed, Plaintiff discovered that the Truck had a seat heater. Nomie Decl., Ex. 4, Caldwell Dep., 71:14-18, ECF No. 88-1. Plaintiff did not want the Truck based on this discovery, but was informed that it would take a significant time to unwind the sale. Id. at 71:22-25. Plaintiff ultimately decided to take possession of the Truck on October 13, 2018, and drove it off the lot the same day. Wess Decl., ¶3, Ex. B Caldwell Dep., 27:12-13; 33:7-11, ECF No. 85.
Third-Party Defendant subsequently serviced the Truck multiple times, including removing a plug and wiring on November 26, 2018. Nomie Decl., Ex. 1, 33:8-14, ECF No. 88-1. Over the next three months, Plaintiff regularly drove the Truck driving between five to six thousand miles. Wess Decl., ¶3, Ex. B Plaintiff's Depo., 35:22-36:4, ECF No. 85.
On December 26, 2018, Plaintiff suffered severe burns to both buttocks from the seat heater in the Truck while driving from Redmond to Eugene, Oregon. SAC ¶ 14, ECF No. 61.
On January 22, 2020, Plaintiff filed a complaint naming Third-Party Plaintiff as a defendant. See Compl., ECF No.1
On March 2, 2020, Third-Party Plaintiff filed a third-party complaint against Third-Party Defendant. See Third-Party Compl., ECF No. 16.
STANDARD OF REVIEW
Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, affidavits, and admissions on file, if any, show “that there is no genuine dispute as to any material fact and the [moving party] is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Substantive law on an issue determines the materiality of a fact. T.W. Elec. Servs.,Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). Whether the evidence is such that a reasonable jury could return a verdict for the nonmoving party determines the authenticity of the dispute. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The moving party has the burden of establishing the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party shows the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings and identify facts which show a genuine issue for trial. Id. at 324. Special rules of construction apply when evaluating a summary judgment motion: (1) all reasonable doubts as to the existence of genuine issues of material fact should be resolved against the moving party; and (2) all inferences to be drawn from the underlying facts must be viewed in the light most favorable to the nonmoving party. T.W. Elec., 809 F.2d at 630.
DISCUSSION
Third-Party Plaintiff alleges that Third-Party Defendant is liable to Plaintiff for his injuries under theories of strict products liability and common law negligence. Third-Party Plaintiff seeks contribution from Third-Party Defendant in a proportionate share of the liability, if any, to Plaintiff. Third-Party Defendant moves for summary judgment on all of Third-Party Plaintiff's claims, on grounds that the claims are premature because Third-Party Plaintiff “has not alleged that it has paid more than its proportionate share of liability to Plaintiff.” Third-Party Def. Mot. for Summ. J. 3, ECF No. 84. Third-Party Defendant also moves for summary judgment on Third-Party Plaintiff's strict liability claim, on grounds that strict liability is not applicable to a seller of a used product under Oregon law. Id. at 9. Finally, Third-Party Defendant moves for summary judgment on Third-Party Plaintiff's common law negligence claim arguing it fails under Oregon law as the injuries sustained by Plaintiff were not reasonably foreseeable.
I. Contribution
The Oregon Supreme Court has explained that a cross-claim for contribution is viable only in limited circumstances: where “[a] defendant who ‘has paid' [more than] its proportional share [of the liability] . . . seeks a separate judgment against a codefendant for the excess amount of its payment.” Lasley v. Combined Transport, Inc., 351 Or. 1, 21 (Or. 2011). The Oregon Supreme Court went on to hold that “[t]he trial court was correct that a cross-claim for contribution was premature” because the defendant had not alleged that it had paid more than its share of the liability. Id. at 26. Here, Third-Party Defendant asserts that because Third-Party Plaintiff has not alleged that it has paid more than its proportional share of liability, under Lasley, Third-Party Plaintiff's contribution claim should be dismissed as premature.
Third-Party Defendant's reliance on Lasley is misplaced. Lasley involved a cross-claim for contribution brought by one named co-defendant against another co-defendant named in the complaint. Id. at 4. Here, however, Third-Party Plaintiff brought a contribution claim against a party not named in the original complaint.
Lasley approvingly discussed such a scenario, albeit in dicta: “when a plaintiff does not join a tortfeasor as a defendant, the [Oregon] comparative negligence statutes permit the named defendant to file a third-party complaint against the tortfeasor.” Id. at 21-22 (citing ORS § 31.600(3). The court went on to explain that:
In that instance, the third-party defendant will not be liable to the defendant but, potentially, will be liable to the plaintiff. ORS 31.600(3) permits a defendant to file a third-party complaint to allege that a third-party defendant is at fault and potentially liable to the plaintiff. ORS 31.600(2) specifically provides that the fact that a plaintiff is not a party to the third-party claim does not prevent the trier of fact from comparing the fault of the third-party defendant in the action brought by the plaintiff.Id.
Further, the Oregon Court of Appeals has allowed a third-party complaint for contribution filed by a defendant against a previously unnamed party to proceed. See Wilda v. Roe, 290 Or.App. 599, 608 (Or. App. 2018). As such, the Court concludes that Third-Party Plaintiff's contribution claim against Third-Party Defendant is expressly permitted by ORS § 31.600(3) and is therefore not premature.
A. Strict Products Liability Claim
Oregon's product liability statutes impose strict liability “if [t]he seller or lessor is engaged in the business of selling or leasing such a product.” See ORS § 30.920(1). To be subject to strict product liability, the defendant must be engaged in the “business of selling” the relevant product within the meaning of the Restatement (Second) of Torts §402A. Mason v. Mt. St. Joseph, Inc., 226 Or.App. 392 (Or. App. 2009); see also ORS § 30.920(3). Comment f of § 402A of the Restatement Second of Torts provides that strict product liability does not “apply to the occasional seller . . . who is not engaged in that activity as a part of his business.”
The Oregon Supreme Court analyzed whether sellers of used goods are engaged in the “business of selling” and concluded “that the sale of a used product, without more, may not be found to generate the kind of expectations of safety that the courts have held are justifiably created by the introduction of a new product into the stream of commerce.” Tillman v. Vance Equip. Co., 286 Or 747, 756 (Or. 1979) (emphasis added). As a result, the Oregon Supreme Court in Tillman held that the “relevant policy considerations do not justify imposing strict liability for defective products on dealers in used goods, at least in the absence of some representation of quality beyond the sale itself or of a special position vis-a-vis the original manufacturer or others in the chain of original distribution.” Id. at 757. Courts applying Tillman have subsequently found a seller of used goods potentially strictly liable under Oregon law where the seller warrantied, serviced, and installed the product. See, e.g., Allstate Indem. Co. v. Go Appliances, LLC, 05-1595 AA, 2006 WL 2045860, at 2-3 (D. Or. July 19, 2006) (finding potential liability where the seller warrantied, serviced, and installed a new compressor on a used refrigerator that was defective).
Third-Party Plaintiff contends that because Third-Party Defendant inspected the truck- including the seat heaters-prior to putting it up for sale, Third-Party Defendant did something more, thus distinguishing this case from Tillman. Third-Party Pl.'s Resp. Opp. Mot. Summ. J. 7, ECF No. 88. Third-Party Plaintiff further contends that the “sale of a vehicle includes all the nuts and bolts affixed to a vehicle” and as Third-Party Defendant “is in the business of selling vehicles” they are a seller pursuant to ORS § 30.920. Id. at 9.
Third-Party Defendant counters that it did not manufacture, distribute, install, service, or sell after-market seat heaters; nor did it advertise itself as a source of after-market seat heaters. Third-Party Def.'s Reply Supp. Mot. Summ. J. 7, ECF No. 93. Further, it contends that it does not hold itself out to the public as a source of information regarding the use of seat heaters. Id.
Third-Party Plaintiff failed to direct the Court to any evidence that Third-Party Defendant created any “representation of safety” as required to overcome Tillman. 286 Or. at 755. Plaintiff purchased the Truck from Third-Party Defendant “as is.” Wess Decl., ¶3, Ex. B Caldwell Dep., 27:12-13; 33:7-11, ECF No.85. Third-Party Defendant did not instruct Plaintiff on use of the seat heater. Nomie Decl., Ex. 4, Caldwell Dep., 71:14-18, ECF No. 88-1. In fact, the record reflects that Plaintiff did not know the Truck had a seat heater until after the sale was completed. Id.
Had Third-Party Plaintiff done so, they may have been able to create a factual dispute sufficient to survive summary judgment as to whether Third-Party Defendant did “something more” to overcome Tillman. However, there is no evidence in the summary judgment record that Third-Party Defendant advertised the quality of their inspection process, warrantied the car and seat heater, or installed the seat heater themselves. See e.g., Allstate Indem. Co., 2006 WL 2045860, at 2-3.
Even viewing the evidence in the light most favorable to Third-Party Plaintiff, the record does not support the assertion that Third-Party Defendant made representations sufficient to overcome Tillman. Accordingly, summary judgment is appropriate on Third-Party Plaintiff's strict product liability claim.
II. Common Law Negligence Claim
Under Oregon Law, “unless the parties invoke a status, a relationship, or a particular standard of conduct that creates, defines, or limits the defendant's duty, the issue of liability for harm actually resulting from defendant's conduct properly depends on whether that conduct unreasonably created a foreseeable risk to a protected interest of the kind of harm that befell the plaintiff.” Fazzolari By and Through Fazzolari v. Portland Sch. Dist. No. 1J, 303 Or. 1, 171336 (Or. 1987). Special relationships in Oregon include “those between ‘professionals' such as lawyers, physicians, architects and engineers and their clients; those between principals such as brokers and their agents; those between trusties and beneficiaries; and, in some instances, those between insurers and their insureds.” Jones v. Emerald Pac. Homes, Inc., 188 Or.App. 471, 477 (Or. App. 2003).
The common theme underlying special relationships is that “one party has authorized the other to exercise independent judgment in his or her behalf and, consequently, the party who owes the duty has a special responsibility to administer, oversee, or otherwise take care of certain affairs belonging to the other party.” Conway v. Pacific Univ., 324 Or. 231, 241 (Or. 1996). Only under those circumstances does Oregon law impose on the authorized party who undertakes to advance the interests of another a duty “beyond the common law duty to exercise reasonable care to prevent foreseeable harm.” Onita Pac. Corp. v. Trs. Of Bronson, 315 Or. 149, 159 (Or. 1992). “Even when a special relationship is the basis for the duty of care owed by one person to another . . . if the special relationship (or status or standard of conduct) does not prescribe a particular scope of duty, then ‘[c]ommon law principles of reasonable care and foreseeability of harm are relevant.'” Oregon Steel Mills, Inc. v. Coopers & Lybrand, LLP, 336 Or. 329, 342 (Or. 2004) (quoting Cain v. Rijken, 300 Or. 706, 717 (Or. 1986)).
Foreseeability is forward-looking in that it “involves a prospective factual judgment about a course of events.” Horton v. Or. Health & Sci. Univ., 277 Or.App. 821, 832 (Or. 2016) (citing Chapman v. Mayfield, 358 Or. 196, 206 (Or. 2015)). Foreseeability “serves as a limit on the scope of liability” as it requires a judgment that a reasonable person, considering the potential harms that might result from the defendant's conduct, would have reasonably expected the plaintiff's injury to occur. Id. In making this judgment, Oregon courts view a defendant's conduct “through the lens of the particular factual circumstances of the case” with an “emphasis on what the defendant knew or should have known about the risk of harm to a particular class of plaintiffs.” Chapman, 358 Or. at 208. It is not necessary that the risk of harm be more probable than not; rather, the question is whether a reasonable person considering the potential harms that might result from his or her conduct would “have reasonably expected the injury to occur.” Stewart v. Jefferson Plywood Co., 255 Or. 603, 609 (Or. 1970).
Third-Party Plaintiff asserts that a special relationship existed between Plaintiff and Third-Party Defendant and thus duty principles rather than foreseeability principles should apply. Third-Party Pl.'s Resp. Opp. Mot. Summ J. 4, ECF No. 88. However, Third-Party Plaintiff fails to direct the Court to any Oregon case law holding that a customer engaging in an ordinary arms-length business transaction creates a special relationship. Id. at 4-6. Additionally, Third-Party Plaintiff has not directed the Court to any evidence showing Plaintiff authorized Third-Party Defendant to exercise independent judgment on his behalf. See, e.g., Conway, 324 Or. at 241.
As special relationships in Oregon have historically involved relationships between professionals and their clients, principals and their agents, trusties and their beneficiaries, and insurers and their insureds, the Court declines to find that a special relationship exists here. Emerald Pac. Homes, Inc., 188 Or.App. at 477.
The Court next turns to whether the type of harm at issue here was foreseeable. The parties do not dispute that Third-Party Defendant purchased, inspected, and put the Truck for sale on its lot. Nomie Decl., Ex. 1, Lefler Dep., 9:4-24; 10:9-13, ECF No. 88-1. Further, there is no dispute that the inspection of the Truck included an inspection of the seat heaters. Id. at 19:13-25; 20:1-4; 41:21-25. That inspection involved using an infrared gun to determine if the seat heaters worked and driving the Truck for a six-mile loop with the seat heater on. Id. at 19:16-20:8; 22:16-19; 37:21-24.
Viewing the facts in the light most favorable to Third-Party Plaintiff, there is “a triable issue of fact as to whether [Third-Party Defendant's] conduct created a foreseeable and unreasonable risk of harm to” Plaintiff for at least two reasons. Chapman, 358 Or. at 206. First, Plaintiff's injury falls squarely within the “type of potential harms” that made Third-Party Defendant's conduct potentially unreasonable. Id. Second, Plaintiff here falls within the “reasonably foreseeable class of injured persons.” Id. Put differently, a rational jury could find burn injuries that resulted from a faulty seat heater in a vehicle sold by a car dealership were foreseeable and that Plaintiff is within the reasonably foreseeable class of injured persons. Id. (“If, and only if, the court determines that the defendant's conduct clearly falls outside the community's conception of fault, the issue of foreseeability must be withdrawn from the jury.”). Moreover, by inspecting the Truck, and specifically the seat heaters, Third-Party Defendant, at least implicitly, recognized that there was a foreseeable risk of harm that the Truck may malfunction and harm potential customers like Plaintiff. Id. (explaining that courts should view “the defendant's conduct through the lens of the particular factual circumstances of the case- with emphasis on what the defendant knew or should have known about the risk of harm to a particular class of plaintiffs”).
Accordingly, Third-Party Defendant's motion for summary judgment should be denied as to Third-Party Plaintiff's common law negligence claim because Third-Party Plaintiff has raised a genuine issues of material fact that preclude judgment as a matter of law.
CONCLUSION
Third-Party Defendant's Motion for Summary Judgment (ECF No. 84) should be GRANTED in part and DENIED in part. Third-Party Defendant's motion should be GRANTED with respect to Third-Party Plaintiff's strict product liability claim. Third-Party Defendant's motion should be DENIED with respect to Third-Party Plaintiff's common law negligence claim.
This recommendation is not an order that is immediately appealable to the Ninth Circuit Court of Appeals. Any notice of appeal pursuant to Federal Rule of Appellate Procedure 4(a)(1) should not be filed until entry of the district court's judgment or appealable order. The Findings and Recommendation will be referred to a district judge. Objections to this Findings and Recommendation, if any, are due fourteen (14) days from today's date. See Fed.R.Civ.P. 72. Failure to file objections within the specified time may waive the right to appeal the District Court's order. Martinez v. Ylst, 951 F.2d 1153, 1157 (9th Cir. 1991).
DATED this 14th day of November 2022.