Product Liability - Franklin P. Brannen, Jr. and Jacob E. Daly

• Jurisdiction: Georgia,United States,Federal
• Publication year: 2008
• Citation: Vol. 60 No. 1

by Franklin P. Brannen, Jr.^* and Jacob E. Daly*^*

This Article surveys recent developments in Georgia product liability law.¹ It covers noteworthy cases decided during the survey period by the Georgia appellate courts, the United States Supreme Court, the United States Court of Appeals for the Eleventh Circuit, and the United States district courts located in Georgia. In addition, this Article discusses provisions in the Official Code of Georgia Annotated (O.C.G.A.) that are particularly relevant to product liability claims.

I. Strict Liability

A. Successor Liability

Under Georgia law, a successor corporation only assumes the liabilities of the original corporation if "(1) there is an agreement to assume liabilities; (2) the transaction is, in fact, a merger; (3) the transaction is a fraudulent attempt to avoid liabilities; or (4) the purchaser is a mere continuation of the predecessor corporation."² The policy behind these exceptions that extend liability to the successor corporation is based on the overlapping experience and expertise of employees from the first corporation to the second.³ Due to this overlap, the successor corpora- tion is better situated than the consumer to appreciate the risks inherent in the design of the challenged product, to insure for any perceived risks, to adjust the price of the product to account for these potential risks, and to improve the quality of the product.⁴

During the survey period, the Georgia Court of Appeals focused on the amount of evidence required to set forth a prima facie showing that a corporation assumed the liabilities of the predecessor corporation. in First Support Services, Inc. v. Trevino,⁵ the plaintiff was injured when he fell approximately thirty feet from a wing stand, which is a large platform that is used by mechanics to service aircraft. The plaintiff contended that his fall was caused by a failure of the pins that are supposed to lock into position to ensure the rigidity of the platform.⁶

The plaintiff sued First Support Services, Inc. (First Support), doing business as SKE Support Services (SKE), which had a contract with the Department of Defense to maintain ground support equipment at Warner Robins Air Force Base. First Support had purchased SKE a month after the plaintiff's accident, but it did not assume SKE's liabilities and did not have the same owners.⁷

After the plaintiffpresented his evidence at trial, First Support moved for a directed verdict, contending that it was not liable to the plaintiff under any product liability theory because it was not the proper party. Specifically, First Support argued that the plaintiff had failed to come forward with any evidence showing that First Support was a successor corporation to SKE.⁸

After reviewing the evidence presented in the plaintiff's case-in-chief, the Georgia Court of Appeals reversed the trial court's denial of First Support's motion for directed verdict and held that the plaintiff failed to come forward with sufficient evidence to show that First Support was a successor corporation of SKE.⁹ The court noted that the plaintiff had presented evidence that First Support employed former SKE workers and had its headquarters on the same street as SKE, but this evidence was countered by testimony that the officers of the two entities were different.¹⁰ in addition, the plaintiff offered into evidence a copy of an amendment to SKE's articles of incorporation which showed that SKE changed its name to First Support.¹¹ But even with this corporate name change, the plaintiff did not come forward with sufficient evidence to show that First Support was a successor corporation of SKE because the plaintiff failed to show that First Support had the same owners as SKE.¹² Without evidence of a unity of ownership, the plaintiff failed to show that First Support was a proper party to the action, and the court of appeals held that the trial court incorrectly denied First Support's motion for a directed verdict.¹³

The outcome of that appeal shows the importance of fundamental issues, like presenting sufficient evidence to show the defendant is a proper party.¹⁴ Without this evidence, a seven-figure verdict was reversed on appeal.¹⁵

B. Manufacturing Defect

To establish a manufacturing defect claim under Georgia law, a plaintiff must show that a defect existed in the product when it left the manufacturer's control and that the defect was caused by the manufacture of the product.¹⁶ in Miller v. Ford Motor Co.,¹⁷ the Georgia Court of Appeals addressed the issue of whether the plaintiff's own testimony regarding the existence of a defect is sufficient to survive summary judgment in a manufacturing defect case.¹⁸

The plaintiffs in Miller sued Ford Motor Company for alleged defects in the side air bag system and the front passenger seat belt in a 1991 Lincoln Town Car.¹⁹ Ford moved for summary judgment, contending that the plaintiffs had no evidence of a defect in the vehicle and had no proof that any defect was the cause of the plaintiff's injuries. in response, the plaintiffs offered their own testimony that the side air bag did not deploy and the front passenger seat belt did not lock in the collision. The plaintiffs failed to come forward with any expert testimony regarding the alleged defects and did not provide any evidence about either the history or the use of the car before the plaintiffs purchased it as a used vehicle.²⁰ in addition, the plaintiffs presented evidence of two recalls relating to the front seat belt assemblies.²¹ However, a product recall serves as circumstantial evidence of a defect only if there is independent proofthat the product has the defect at issue in the recall.²² Here, the recall documents indicated that the recall only applied to belt assemblies that had been installed as replacement equipment.²³ Because the plaintiffs introduced no evidence that the seat belt system was a replacement part, there was no extrinsic evidence to link the recall to the defect at issue.²⁴

The court of appeals summarily dismissed the plaintiffs' contention that the doctrine of res ipsa loquitur should create an evidentiary presumption of defectiveness.²⁵ According to the court, this "'doctrine does not apply to mechanical devices because they get out of working order, and sometimes become dangerous and cause injury without negligence on the part of anyone.'"²⁶ Furthermore, the doctrine does not apply here because the defendant did not have exclusive control over the car, which had been driven for fifty thousand miles over three years.²⁷ Miller reaffirms that to survive summary judgment under Georgia law, plaintiffs in product liability lawsuits must come forward with more evidence than just their self-serving testimony about an alleged defect.

II. FAILURE TO WARN

A. Liability of Brand-Name Manufacturer for Marketing of Generic Product

Only manufacturers may be strictly liable for injuries caused by their product,²⁸ but other suppliers of the product (for example, retailers, sellers, and distributors) may be liable in negligence for those inju-ries.²⁹ Because entities that played no role in the design or manufacture of the product cannot be liable for a design or manufacturing defect

(whether in strict liability or negligence), claims against "product sellers"³⁰ are generally based on a negligent failure to warn about the product's dangers.³¹ In most cases, it is easy to determine the proper defendants because each entity's role in the manufacturing, distribution, and sale of the product is clear. But when the product is a generic prescription drug that is designed, manufactured, labeled, and marketed similar to its brand-name counterpart, is the brand-name manufacturer liable for injuries caused by the generic version of its product? The United States District Court for the Northern District of Georgia confronted this issue in one case during the survey period.³²

In Swicegood v. Pliva, Inc. ,³³ the plaintiff developed tardive dystonia and other neurological injuries after taking metoclopramide (the generic equivalent ofReglan) to treat nausea. Wyeth manufactured Reglan until December 2001, at which time Schwarz Pharma, Inc. purchased the rights to distribute Reglan tablets. The plaintiff's doctor prescribed Reglan in April 2005, but her pharmacist dispensed the generic equivalent, which Pliva, Inc. manufactured. The plaintiff took the generic equivalent until July 2005, when she suffered an adverse reaction. In addition to suing Pliva and its successor, Barr Pharmaceuticals, the plaintiff sued Wyeth and Schwarz based on the theory that the improper labeling of Reglan ensured that the generic equivalent would also be improperly labeled. The plaintiff alleged that all of the defendants knew that long-term use of Reglan created a greater risk of developing tardive dystonia than they disclosed to the Food and Drug Administration (FDA) or to the public. Among other theories, the plaintiff's claims were based on strict liability, negligence, and fraudulent and negligent misrepresentation. Wyeth and Schwarz moved to dismiss the claims against them on the grounds that they failed to state a claim upon which relief could be granted.³⁴

As for the plaintiff's claims based on strict liability, the district court granted Wyeth and Schwarz's motion because they did not manufacture the allegedly defective product—the generic equivalent of Reglan.³⁵ Because the plaintiff did not take Reglan, there was no basis for Wyeth and Schwarz to be held strictly liable.³⁶ Similarly, the district court granted Wyeth and Schwarz's motion with respect to the plaintiff's claims for negligent failure to warn and fraudulent and negligent misrepresentation because they did not manufacture or distribute the generic version of Reglan that the plaintiff took and were not responsible for its labeling.³⁷ Because neither Wyeth nor Schwarz supplied the generic drug to the plaintiff, they had no duty to warn her about any dangers...