Chapter 7 The Preemption Issue Government Contractor Defense Market Share Liability and other Developing Issues
| Jurisdiction | New York |
I. INTRODUCTION
Nowhere does the law seem in a greater state of flux than in products liability. Both plaintiffs and defendants spend considerable time, effort, money and resources investigating, pursuing, researching and defending products liability claims. In order to fairly evaluate the merits of a claim, the practitioner must be aware of developments in the law as they occur
This chapter addresses some of the rapidly developing issues in the products liability field: federal preemption, the government contractor defense, market share liability, the learned intermediary and sophisticated user doctrines and causes of action based on phobias. Where possible, New York cases are cited and used as examples. However, these issues have not only affected New York, but have had national impact as well. Therefore, federal cases frequently are cited, as well as cases from courts of states other than New York. Cases from other jurisdictions affect the New York practitioner since they are often looked to by New York judges when deciding whether to impose new theories of liability upon defendants or to grant new defenses to plaintiffs’ causes of action
II. THE FEDERAL PREEMPTION DOCTRINE
A. Introduction
Although the doctrine of federal preemption dates back to some of the earliest judicial decisions in the history of the American republic 1387 and has lengthy precedent in areas of the law such as labor relations and interstate commerce 1388 it has only recently appeared in the products liability field. As federal regulatory powers have grown, congressional regulation of products in the marketplace has become commonplace 1389 Congress routinely passes laws and adopts regulations that govern the use of products, and congressional agencies—the Consumer Product Safety Commission, for example—routinely oversee and regulate the conduct of product manufacturers. A product manufacturer’s failure to comply with what Congress has mandated could result in substantial penalties for violation of federal law.
In the context of this growing regulation, product manufacturers have asserted the defense of federal preemption in state common law products liability actions. If a product manufacturer believes that its federally mandated obligation conflicts with a state common law products liability claim, the manufacturer may assert that federal regulation of its conduct preempts the common law state tort claim, and that the claim should be dismissed by the court without reaching the merits. The federal preemption defense has become a useful weapon for the products liability defendant, and the plaintiff must be vigilant to ensure that his or her state law claim is not barred by federal law or regulation.
The doctrine of preemption is grounded in the Supremacy Clause of the U.S. Constitution, which states: “This Constitution, and the Laws of the United States, which shall be made in Pursuance thereof; . . . shall be the Supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” 1390 Simply put, this clause means that Congress has the power to pass any law or enact any regulation that “preempts” state law, including state common law. Federal preemption will only lie if Congress clearly intended federal law to supersede state law. Generally, there is a legal presumption against a finding of preemption.
B. Types of Preemption
Congress may preempt state law in three ways. First, it can expressly preempt a state law by explicit statutory language that defines the extent to which it intends to supersede state law. Second, in the absence of explicit statutory language, Congress may preempt state law impliedly by evincing its intent to occupy the entire field of regulation. Finally, Congress may preempt any state law that conflicts with federal law.
When Congress categorically declares that its statute or rule supersedes state law, preemption is express. For instance, in Jones v. Rath Packing Co., 1391 the U.S. Supreme Court found that a federal meat inspection law, which specifically prohibited states from imposing different labeling requirements than those provided for by Congress, explicitly and clearly preempted a state statute that purported to impose different obligations upon the meat packing industry than those imposed by Congress. In the products liability field, the Supreme Court, in Cipollone v. Liggett Group, Inc., 1392 held that the explicit language of the Public Health Cigarette Smoking Act of 1969 1393 expressly barred the plaintiff’s claims based on failure-to-warn theories.
Implied preemption occurs where Congress, through a pervasive scheme in its federal law and/or regulation, has preempted the field to bar state law or regulation. For example, the Supreme Court held in Rice v. Santa Fe Elevator Corp. 1394 that Congress’s purpose in passing legislation to regulate all warehouses used for storage, together with the establishment of a congressional agency to oversee and control uniform grain storage practices, evidenced intent to so cover the field that it impliedly precluded the states from adopting their own regulatory statutes and rules.
When the state law in question interferes with a congressional objective, the “conflicting” state law may be preempted. Conflict preemption exists “where it is impossible for a private party to comply with both state and federal requirements or where state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” 1395
C. Preemption in Practice in the Products Liability Field
Although, theoretically, there are three categories of preemption, the lines between these categories blur in actual practice. Nowhere is this more evident than in the ever-evolving developments in the products liability field. Although federal preemption may apply in any number of circumstances, it has most frequently been debated in cigarette and pesticide litigation.
The case that generated the most attention, and has significantly affected the development of the federal preemption doctrine in the products liability field, is Cipollone v. Liggett Group, Inc. 1396 In Cipollone, the U.S. Supreme Court analyzed the preemptive effect of the Cigarette Labeling and Advertising Act of 1965, as amended by the Public Health Cigarette Smoking Act of 1969. 1397 The Court, in a sweeping decision, held that these acts only preempt positive enactments by state and federal rulemaking bodies mandating particular warnings on cigarette labels or cigarette advertisements. Therefore, the defense of preemption would apply only to a claim based on failure to warn. Other theories of recovery—such as breach of warranty, fraudulent misrepresentation or concealment of facts, and conspiracy—are not preempted by the acts. The Court, in so holding, declined to decide the issue on the grounds of implied preemption, determining instead that when Congress has considered the issue of preemption and has included in the enacted legislation an express provision addressing the issue, then that provision would provide the basis for determining congressional intent to preempt state authority. 1398
Throughout the course of this very contentious litigation, the defendant tobacco companies steadfastly maintained that the acts protected them from liability based on any conduct after 1965. On the other hand, the plaintiff argued that preemption, if any, of the acts was limited solely to statutory and regulatory conduct by the states and in no way barred state common law causes of action. The plurality decision (there was no clear majority opinion), which found some basis for federal preemption but which refused to dismiss all of plaintiff’s claims, must be fully clarified by future court decisions. In any event, the decision was splintered enough that both sides in Cipollone claimed victory. 1399
The increasing number of claims for exposure to pesticides has led manufacturers for the pesticide industry to routinely assert the federal preemption defense, based on the congressional regulatory scheme contained in FIFRA. Papas v. Upjohn Co 1401 is instructive on this issue. Papas brought suit against several pesticide manufacturers, seeking damages for injuries sustained from exposure to pesticides. The plaintiff’s complaint contained claims for negligence, strict liability and breach of implied warranty. Each of these claims was based, in whole or in part, on a claim of inadequate labeling of the alleged dangers arising from exposure to pesticides. The Eleventh Circuit, in a 1991 decision that relied on the doctrine of implied preemption, concluded that FIFRA preempted all state common law suits against manufacturers of EPA-registered pesticides to the extent that such actions were based on claims of inadequate labeling. 1402 However, in light of its Cipollone decision, the Supreme Court vacated the judgment and remanded the case to the Eleventh Circuit for further consideration. 1403 Upon remand, the Eleventh Circuit affirmed its prior judgment, this time holding that the state common law tort claims based on inadequate labeling were expressly preempted by FIFRA. 1404
Burke v. Dow Chemical Co. 1405 addressed the issue of express preemption of state tort common law claims under FIFRA. Burke claimed that the plaintiff’s children had suffered brain damage as a result of their mother’s exposure to household insecticides while she was pregnant. Judge Weinstein concluded that FIFRA...
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