Chapter 13
Warranties, Product
Liability, and
Consumer Law
Case 13.1
9 Cal.Rptr.3d 29, 4 Cal. Daily Op. Serv. 482, 2004 Daily Journal D.A.R. 613 Review Granted,
Previously published at: 114 Cal.App.4th 1429, (Cal.Const. art. 6, s 12; Cal. Rules of Court,
Rules 28, 976, 977, 979)
Court of Appeal, First District, Division 4, California.
Patricia HENLEY, Plaintiff and Respondent,
v.
PHILIP MORRIS INC., Defendant and Appellant.
No. A086991.
Jan. 20, 2004.
, J.
Plaintiff brought this action for personal injuries allegedly sustained as a result of defendant's tortious misconduct in the
manufacture and marketing of cigarettes. The jury returned a special verdict awarding plaintiff $1.5 million in
compensatory damages and $50 million in punitive damages. The trial court denied defendant's motions for new trial and
judgment notwithstanding the verdict, except that it ordered a new trial on punitive damages unless plaintiff consented to
reduce the punitive award to $25 million. Plaintiff consented to the reduction, and defendant filed a timely appeal.
In our original opinion we affirmed the judgment in its entirety. review granted Jan. 29, 2002, S102941 ) The Supreme
Court granted review and ultimately retransferred the matter to us with directions to "vacate [our] decision and to
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247
reconsider the cause in light of [ ] ), and [ ] )." We concluded that many of defendant's objections, including its claims of
error under those cases, had not been preserved for appeal. (See pt. I., below.)
Defendant again petitioned the California Supreme Court, which again remanded the matter for reconsideration, this time
in light of In that case the United States Supreme Court elaborated considerably upon the federal constitutional principles
constraining civil punitive damage awards. We have concluded that in light of that decision, the $25 million in punitive
damages awarded in this matter cannot be sustained on the present record, but that an award of $9 million would satisfy
the constitutional standards enunciated in that case. Accordingly we will reverse for a new trial on punitive damages unless
plaintiff agrees to a reduction of the judgment to reflect such smaller award. Following a further transfer from the Supreme
Court, we have made certain technical corrections to the dispositional language. In all other respects we reiterate our
previous decision.
INTRODUCTION AND BACKGROUND
[1][2][3] We begin with a fundamental principle overlooked by defendant: "A judgment or order of the lower court is
presumed correct. All intendments and presumptions are indulged to support it on matters as to which the record is silent,
and error must be affirmatively shown. This is not only a general principle of appellate practice but an ingredient of the
constitutional doctrine of reversible error." (.) Thus in ascertaining the underlying facts for purposes of appellate analysis,
the reviewing court "must consider the evidence in the light most favorable to the prevailing party, giving him the benefit of
every reasonable inference, and resolving conflicts in support of the judgment." (Id. at § 359, p. 408, italics in original.)
Viewed most favorably to the judgment, the evidence shows that plaintiff, who was born in 1946, began smoking cigarettes
in 1961 or 1962, at the age of 15, when she "lit up" with some school friends outside a dance. At that time she felt smoking
was "cool" and "grown up," provided the pleasure of the forbidden, made her look older, and served as a "rite of passage."
Then and for some years thereafter, nobody told her that cigarettes could cause her serious disease. There were no
warnings on cigarette packages or in advertisements. Plaintiff was not taught in school about the dangers of tobacco. As a
result she believed that cigarettes, which contained "[t]obacco, pure and simple," were "not a harmful product." Nor did she
know that cigarettes or nicotine could be addicting. Nothing in the advertising she saw suggested that if she started
smoking she might be unable to stop.
The jury could also find that starting no later than December 1953, defendant and other cigarette manufacturers agreed to
act together to counter mounting scientific evidence about the health risks of cigarette smoking. By the time plaintiff began
smoking, defendant knew that tobacco contained numerous carcinogenic substances as well as flavoring additives that also
produced carcinogenic compounds upon combustion. Tobacco manufacturers were also aware of epidemiological studies that
showed a strong correlation between smoking and the incidence of lung cancer. Yet they launched a concerted public
relations campaign to deny any link between smoking and serious illness. A major part of this strategy was the creation of a
"research institute" that would, as the public was told, attempt to find the truth about smoking and health--though in fact it
was permitted to conduct very little research that might confirm a link, serving mainly, as the jury was entitled to find, to
gather ammunition against tobacco's detractors. Other strategies included manipulating the mass media to suppress or
make light of adverse news developments, such as new studies or reports.
The jury could also find that defendant engaged in saturation advertising, much of it consciously targeting the teenage
audience from which new ("replacement") smokers had to come. Defendant knew that persons who did not begin smoking
during their teen years were unlikely to do so. In particular, defendant sold the brand of cigarette plaintiff preferred,
Marlboro, using symbols of the independence, autonomy, and mature strength for which teenagers were understood to
yearn. The jury could find that these targeted teenage consumers possessed less critical judgment, and were more receptive
to marketing manipulation generally, than might be the case with adults. The jury could find that teenagers who went past
the experimentation phase became addicted to tobacco, as a result of which they found it extremely difficult to stop smoking
and often suffered impaired judgment with respect to the consequences of continuing to do so. The jury could find that the
strategy of marketing to teenagers and causing them to become addicted to its products was central to the tremendous
success and profitability of the Marlboro brand in particular, helping defendant to become one of the largest and most
successful corporations in the world.
We use the term "addicted" as shorthand without meaning to declare as a judicial fact that tobacco is addictive in
any settled medical sense. That question is not before us. The jury here presumptively found that tobacco was
addictive in a sense supported by the evidence and supportive of the judgment.
In 1966, as evidence of health risks mounted, Congress required that cigarette packages bear the relatively mild warning
that smoking "may be hazardous." In 1969, Congress required a somewhat stronger warning and required that it appear in
advertising as well as on packages. At the same time, Congress explicitly preempted any state law imposing a "requirement
or prohibition with respect to advertising or promotion" of cigarettes--language that has since been construed to preempt
many but not all common-law tort claims. Although the warnings have since been further strengthened, this partial federal
immunity remains in place, and is one of defendant's major defenses here. (See pt. II., below.)
In 1988 the tobacco industry acquired a safe harbor under California law when, riding the coattails of a legislative
compromise, tobacco was listed among "common consumer products" in former section 1714.45, a statute construed the
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following year to create an almost complete "immunity" from tort liability.
The Legislature repealed that protection
effective January 1, 1998, but defendant contended below that it nonetheless applied to bar most or all of plaintiff's claims.
(See pt. I., below.)
All references to former section 1714.45 are to the version in effect from January 1, 1988, to January 1, 1998.
The jury would have been entitled to find that well before these legislative defenses became applicable, plaintiff had become
an addicted smoker with sharply impaired judgment and will where cigarettes were concerned. Plaintiff testified that on
the subject of cigarette smoking and health, "my brain wasn't going to register anything that anybody said." When she saw
the first package warnings, she minimized the perceived "degree[ ] of danger," thinking to herself that it was also
"dangerous to walk across the street." She testified that while she heard the United States Surgeon General was saying
things about cigarettes, she also knew "that the tobacco companies were saying different." As a result, the package warning
"didn't faze me one way or the other. I wasn't going to give the cigarettes up at that point."
Plaintiff's first regular brand of cigarettes was Marlboro, and it remained her favorite brand throughout almost all of her 35year smoking history. From age 15 until she was about 43 years old (around 1989), she apparently smoked one-and-a-half
to two packs a day of "Marlboro Red," a brand rated to deliver relatively high amounts of tar and nicotine. At that age,
however, she switched to Marlboro Lights, a lower-tar brand, on what the jury was entitled to view as the direct advice of a
Philip Morris agent. Plaintiff testified that around that time she began to hear that "low-tar cigarettes were better. You
wouldn't get as much tar and nicotine and, you know, their advertising on the low-tar cigarettes was really out there. [¶ ]
I'm thinking, 'Well, okay. Maybe there's something to this.' So when I was approximately 43, I decided that, 'Well, I'll check
into this and maybe I'll change from the Reds to the Lights.' [¶ ] So I did indeed call the Marlboro, Philip Morris company
and expressed, you know, my concerns as to, 'Is it really true? Is there less tar in this or less nicotine?' [¶ ] And I was
assured at the time that if I was concerned that, yes, I could switch to the Lights...." She did so and, in a few weeks, had
more or less doubled her intake, to three-and-a-half packs a day.
By mid-October 1997 plaintiff "was feeling really bad" and "down for the count with what I thought was heavy-duty flu."
She was diagnosed in February 1998 with small-cell carcinoma of the lung. The jury was more than entitled to find that this
affliction was directly caused by cigarette smoking.
ANALYSIS
I. "IMMUNITY" UNDER FORMER SECTION 1714.45
A. Substantive Background.
As in effect from 1988 through the end of 1997, former section 1714.45 granted tobacco manufacturers "immunity" from
most claims for personal injury caused by their products. By amendments effective January 1, 1998, the Legislature
repealed that protection. In the Supreme Court held that the repeal was "not retroactive," but was "prospective only." see
Specifically, the repeal did not operate to impose liability for conduct that was protected by the statute when it occurred.
However, the repeal "removed the protection that the Immunity Statute gave to tobacco companies for their conduct
occurring before [former section 1714.45's] effective date." italics omitted.) The net result is that the former statute
"continues to shield defendant tobacco companies in product liability actions but only for conduct they engaged in during the
10-year period when the Immunity Statute was in effect. The liability of tobacco companies based on their conduct outside
the 10-year period of immunity is governed by general tort principles." italics omitted; see
Following the Supreme Court's example, we use the term "immunity" guardedly to describe the defense conferred
by former section 1714.45. (See
In the court considered the scope of the protection afforded by the former statute for conduct while it was in effect. It
summarized its conclusions as follows: "[T]he Immunity Statute bars plaintiff's claims, however labeled, where they allege
no more than personal injury caused by dangers or risks inherent in the consumption of tobacco products such as cigarettes.
But the Immunity Statute does not bar plaintiff's claims that the defendants adulterated the cigarettes plaintiff smoked
with additives that exposed him to dangers not inherent in cigarette smoking. Nor does the Immunity Statute shield
tobacco companies from liability for conduct outside the immunity period."
B. Preservation of Issues for Appeal.
In our original opinion we held that defendant had not preserved any contention that former section 1714.45 afforded
anything less than a complete defense. We noted that defendant had only asserted the statute in the trial court as a basis
for a nonsuit or directed verdict, i.e., as a complete defense to plaintiff's entire action, except her claim for breach of express
warranty, which was expressly exempted by the statute itself. We wrote that the trial court's denial of the motion for
nonsuit or directed verdict was the only "specific and reviewable ruling" before us. We held that defendant had failed to
preserve various other claims of error suggested in its briefs. We noted this failure again when we later addressed
defendant's argument that the abolition of the former immunity would offend the prohibition against ex post facto laws. We
reasoned that this argument could at most operate to preclude the imposition of punitive damages based on conduct that
was immunized when it occurred. We held that, as so understood, the ex post facto argument had not been preserved for
appeal. We concluded that the trial court did not err in denying defendant's motions for nonsuit and directed verdict
because the repeal of former section 1714.45 permitted plaintiff to pursue her claims at least in part. Since defendant had
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not asserted any more limited defense based on the former statute, we did not reach the question whether some such limited
defense might exist.
Defendant also raised section 1714.45 in its motion for new trial, and there suggested for the first time that the jury
should have been told not to consider defendant's conduct during the immunity window in support of most of
plaintiff's theories of liability, or in support of a punitive damages award. As we discuss below, this belated
assertion of a time-limited immunity was ineffectual to preserve the issue for appeal; it is relevant here only as
evidence that defendant was actually aware of such a theory very soon after the jury returned its verdict.
We wrote, "Defendant's claim of erroneous admission of evidence is not cognizable in the absence of an objection
below on the ground now asserted. (, subd (a).) Defendant's statement that the evidence was admitted 'despite
objection' is somewhat disingenuous: the cited objections had nothing to do with the issue now under discussion.
Defendant's complaint that the trial court should have instructed the jury to disregard evidence of conduct
supposedly immunized by the statute founders on the acknowledged fact that no such instruction was proffered or
requested. Nor does the cited authority support defendant's claim that the court was required to give such an
instruction on its own motion. Finally, in ruling on post-trial motions the trial court was entitled to consider
objectionable evidence to which no objection was asserted. (; Cal. Law Rev. Com. com., .)"
We wrote, "We are directed to no evidence that defendant requested an instruction informing the jury that it could
not award punitive damages based on conduct during the time the immunity was in effect (the immunity window).
Indeed we are directed to no evidence that defendant ever sought to separate the ex post facto issue, as it arose
under section 1714.45, from the claim of a total defense based on that statute. Since the ex post facto argument
could at most warrant relief affecting punitive damages, and in that regard only to limit the evidence that the jury
could consider, it was not adequately presented by a motion for nonsuit, and is not properly before us."
[4] In and the Supreme Court held that the repeal of former section 1714.45 left intact a time-limited immunity that
precludes consideration, in support of most theories of liability, of a tobacco manufacturer's conduct while the former statute
was in effect, i.e., from January 1, 1988 through December 31, 1997. At the same time, the court confirmed our own prior
conclusion that the former statute no longer affords a complete defense where, as here, the plaintiff's injuries are
attributable to tortious conduct both within and without the immunity period. As applicable here, the rule of / means that,
upon request, defendant would have been entitled to prevent the jury from considering its conduct during the immunity
period in support of punitive damages or in support of most theories of compensatory damages. However the rule of those
cases does not affect our previous conclusion that the trial court correctly denied defendant's motions for nonsuit or directed
verdict.
The question now before us is whether defendant has preserved any claim of error predicated on the time-limited immunity
afforded under / Although our prior opinion may be understood to answer this question in the negative, we have revisited
the issue de novo in light of the Supreme Court's vacation of that opinion. After reviewing the parties' supplemental briefs
and the applicable principles of appellate procedure, we have once again concluded that defendant has failed to preserve for
appeal any claim of a partial defense under former section 1714.45, including the time- limited immunity conferred by /
C. Failure to Raise Point Below.
[5] Defendant's basic complaint under / is that the jury was permitted to consider conduct during the immunity period in
support of plaintiff's claims for both compensatory and punitive damages. At its core this is a contention concerning the lack
of relevancy, or limited relevancy, of such evidence. Yet at no time prior to the verdict did defendant so much as hint to the
trial court that section 1714.45 might operate to restrict the admissibility of such evidence or the purposes for which it could
be considered by the jury. Defendant could have raised such a point by several means, including motion in limine,
contemporaneous objection to evidence (with request for admonition if the evidence was admissible for a limited purpose),
motion to strike (if the evidence came in before an objection could be lodged), and appropriate instructions at the end of trial.
Defendant invoked none of these remedies or devices. Instead defendant cited section 1714.45 solely as the basis for an allor-nothing defense, and sat mute while plaintiff introduced, and the jury heard and considered, evidence of conduct during
the immunity period.
The record discloses no explanation for this conduct. It does not suggest, for example, that defendant was compelled to
forego a more limited application of former section 1714.45 in order to raise the statute as a complete bar. On the contrary,
it appears that defendant was entirely free to assert both positions in the alternative, i.e., that the former statute continued
to afford a complete defense but, failing that, rendered conduct during the immunity period inadmissible or admissible only
for limited purposes.
[6] Ordinarily the failure to raise a legal theory by appropriate objection or motion in the trial court precludes consideration
of that theory on appeal. ["As a general rule, issues or theories not properly raised or presented before the trial court will
not be considered on appeal."]; see 9 Witkin, Cal. Procedure, supra, § 394, p. 444.) This rule may not bar consideration of at
least some objections that are deemed "jurisdictional." (See 9 Witkin, Cal. Procedure, supra, § 398 [rule does not bar
consideration of "[a] noncurable defect of substance where the question is one of law, such as lack of jurisdiction"]; see
[court would exercise its discretion to consider "a jurisdictional issue of first impression"].) However, at oral argument
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counsel for defendant disclaimed any contention that the claimed error here is jurisdictional in this sense. He contended
that the cognizability of the point is affected by the heightened judicial oversight employed with respect to punitive damage
awards, but no authority has been cited to or found by us suggesting that otherwise noncognizable error in the admission of
evidence or instructions concerning it can be raised on appeal without a predicate objection in the trial court. (Cf. [failure to
require evidence of defendant's financial condition cognizable on appeal despite absence of predicate objection because
absence of such evidence thwarts effective appellate oversight of award]; [to same effect].)
We turn to the question whether defendant has brought itself within any other exception to the rule generally barring points
on appeal that were not raised by appropriate objection in the trial court.
D. Newly Decided Point of Law.
[7] We first consider whether defendant is excused from the requirement of a predicate trial court objection because the
authority on which it now relies was only decided after trial. Defendant contends that its failure to raise the concept of an
immunity window in the trial court is "excusable as a matter of law given that, at the time of trial, the proper scope of
immunity was unsettled." The implication is that whenever a previously unsettled issue of law is authoritatively resolved
after trial, a party benefiting from the new rule may assert it on appeal whether or not any relief consistent with that rule
was requested in the trial court.
[8] Such a proposition is not borne out by the cases. Although courts may choose to consider a new point on appeal where it
rests on newly decided authority, this exception does not properly apply unless it appears that the new rule could not fairly
be anticipated at the first trial, or its assertion would have been futile because it conflicted with then-governing law.
See and cases cited ("Courts have often entertained new arguments on appeal when they rest on new authority
that the appellant could not fairly be expected to anticipate"; argument entertained because new authority marked
"an unforeseeable departure from prior law"); (antitrust challenge to ordinance entertained where, prior to new
decision, challenge "could not reasonably have been expected to survive demurrer"); (new rule of law viewed as
example of principle that point is not lost if it "could not have been raised in the court below"); (reversing for
reconsideration of new trial motion in light of intervening authority where new theory "was not open to [appellant]
at the time of trial"; appellant should not be "unfairly penalize[d] ... for a lack of extrasensory perception"); cf.
brackets in original (point not entertained where, inter alia, it was not one which, prior to new decision, " 'could not
reasonably have been expected to [succeed]' "; appellant "could have argued by analogy" from existing authorities);
(court was "wholly unpersuaded" that prior to rendition of intervening decision, appellant "could not have pursued a
nuisance theory").
Defendant quotes the broad statement in that "a court will consider on appeal a new point of law decided while the appeal
is pending." Read in context, however, that statement is entirely consistent with the qualifications we have just noted. The
court went on to quote, and apply in this context, Witkin's statement of the parallel exception to the rule against changing
one's "theory of trial" on appeal: " 'A court may refuse to follow the doctrine [of not hearing new arguments on appeal]
where, after trial, there is a change in judicially declared law which validates a theory that would have been rejected if
presented under the case law as it existed at the time of trial. [Citation.]' " italics added, bracketed material in original; see
now 9 Witkin, Cal. Procedure, supra, § 406, at p. 457;
Moreover the newly raised issue in --the enforceability of surrogate parent contracts--was "a matter of intense public and
legal concern." In addition, the court's consideration of the point did not necessitate a retrial because the court rejected the
newly asserted objection on the merits.
As the court noted, "One of the reasons parties are not normally allowed to raise
new issues on appeal is that it is unfair to their opponents who did not have the opportunity to attack that theory factually
or legally in the trial court, and to the trial court itself, which may be required to retry issues that might have been handled
more efficiently the first time around." The latter danger was obviated in by the fact that the new point lacked merit and
reversal was not required. Here, in contrast, the successful assertion of the newly asserted objections would necessitate a
new trial.
[9] A similar factor distinguishes the second case cited by defendant, in which the court relied on newly available authority
to direct entry of judgment for the appellant.
see [judgment upholding racially restrictive covenant reversed based on
intervening holding that such covenants are judicially unenforceable; had intervening decision been rendered before trial,
"judgment for the defendants would have followed necessarily"; in light of decision "the whole purpose of the litigation
fails"].) These cases address pure issues of law on undisputed, or materially undisputed, facts. In such a situation
consideration of the newly raised point will not necessitate a retrial; rather a final judgment will be entered in favor of one
of the parties. Permitting the point to be raised therefore does not implicate the considerations of economy and fairness on
which the requirement of predicate objections is based.
The case is also distinguishable because, as noted in a subsequent decision on substantially identical facts, the
instruction at issue there purported to enumerate the elements of a tort while leaving out a "material element" as
articulated in an intervening Supreme Court decision.
The resulting misdefinition of the tort constituted
affirmative misdirection that could be asserted on appeal without an objection in the trial court. Here there was no
misdescription of the elements of any cause of action, and as noted below, no other affirmative misstatement of law.
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Rather the alleged error consisted of a failure to instruct the jury on a point of evidence.
Indeed, we have found no case in which a judgment was reversed for a new trial after an appellant failed to raise
appropriate objections in the trial court, even where the point rested on newly issued judicial clarifications of previously
unsettled law. For such a result to obtain, it would have to appear not simply that new authority would have mandated
somewhat different proceedings at trial, but that the balance of fairness and judicial economy weighed distinctly in favor of
excusing the appellant from the usual rule.
The nearest thing to a reversal for new trial is found in where the court essentially delegated the question of
disposition to the trial court by remanding for reconsideration of the appellant's motion for new trial. The court
declared that such a remedy was available and justified "in the narrow circumstances of this case," because the trial
court's ruling was "vitally affected" by intervening authority and either an affirmance or a remand for retrial would
have been "grossly unjust to the parties." A similar concern for fairness and judicial economy is reflected in where
this division reversed a domestic relations order based on intervening changes in law. Justice Poché took pains to
narrow the precedential effect of that disposition by noting that the matter was "being remanded in any event"
based on another error, and that as a result "consideration of the [newly asserted] point introduces no significant
judicial inefficiency."
This is not such a case. Defendant has offered no excuse for not raising the concept of an immunity window prior to the
verdict. The enactment and subsequent repeal of tobacco company immunity in section 1714.45 raised delicate issues of
statutory construction, but the possible answers to the question took only three shapes: (1) the repeal could have been
wholly ineffective to reinstate tobacco company liability, such that tobacco defendants could only be liable for conduct taking
place after the statute was repealed; (2) the repeal could have utterly abolished the defense, as though the former immunity
had never existed; or (3) the repeal could have been held to have an intermediate effect. The most obvious rule in the third
category is the one adopted by the Supreme Court in / i.e., that the former statute continued to shield conduct which was
undertaken under the protection of the statute, i.e., while the statute was in effect. This outcome gives the 1998 repeal a
substantial effect by restoring the application of basic tort law to a great deal of tobacco company conduct. At the same
time, it protects the reliance interests which lie at the heart of the judicial aversion to "retroactive" changes in substantive
law. The Supreme Court has summarized the governing jurisprudential concern as follows: "[T]he presumption against
retroactive legislation is deeply rooted in our jurisprudence, and embodies a legal doctrine centuries older than our Republic.
Elementary considerations of fairness dictate that individuals should have an opportunity to know what the law is and to
conform their conduct accordingly; settled expectations should not be lightly disrupted. For that reason, the 'principle that
the legal effect of conduct should ordinarily be assessed under the law that existed when the conduct took place has timeless
and universal appeal.' " italics added, fns. omitted, quoting (conc. opn. of Scalia, J.).)
Defendant cannot claim to have been unaware of this concern; it quoted the foregoing passage in its memorandum in
support of nonsuit. Similarly it quoted language from a federal district court order holding the repeal of section 1714.45 "not
retroactive" in the sense that the tobacco defendants there were " 'immune from liability for Plaintiff's tobacco-related
personal injuries caused by conduct occurring during the effective period of the 1987 statutory amendment.' " (Italics added,
underlining removed.) Yet defendant at no time prior to verdict suggested to the trial court that the net effect of the
repealed immunity might be to render certain evidence inadmissible or to place limitations on the purposes for which such
evidence could be admitted. Defendant argued only that the former statute continued to afford the same categorical defense
it provided before its repeal.
Thus, in its memorandum supporting nonsuit, defendant wrote:
"Immunity under Section 1714.45 does not depend on the peculiar circumstances of each case, but rather is
'automatic' and justifies judgment on the pleadings in any claim for product liability against tobacco suppliers.
[Citation.]" (Italics added.)
"[B]ecause the statutory immunity ... was in effect at all times relevant to Plaintiff's claims, she is barred from
bringing this personal injury action." (Italics added.)
"Section 1714.45 affords Philip Morris virtually absolute immunity for acts committed prior to January 1, 1998."
(Italics added.)
Any doubt about the foreseeability of the / immunity window is dispelled by defendant's own allusion to this concept
immediately after trial. In its new trial memorandum, defendant asserted for the first time that, "[a]t a minimum, the jury
should have been instructed that it could not consider Defendant's conduct during the 1988-1997 period in determining
Philip Morris' liability and in computing Plaintiff's damages. Since the jury was permitted to impose liability for
compensatory and punitive damages on the basis of conduct that was immunized when it occurred, Philip Morris was
prevented from having a fair trial."
Of course a motion for new trial is no substitute for timely objections during trial. (See [rejecting claim that "legal
challenges may be presented for the first time by way of posttrial motion and will be treated as if raised before the verdict"];
[distinguishing as involving "a question of law on undisputed facts"].) Here the chief relevance of the motion is to show that,
five weeks after the jury returned its verdict, defendant was fully cognizant of the possibility of an immunity window.
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Nothing in the record suggests that this constituted a new realization, let alone that any putative failure to recognize it
earlier was excusable.
At oral argument, counsel for defendant disclaimed any contention that something happened after trial to cause
defendant to raise the point.
Even if defendant had not demonstrated its own awareness of a possible immunity window, we would conclude that such a
possibility was apparent, if not obvious, from the nature of the issues presented. Indeed in our prior opinion we ourselves
twice alluded to that possibility--once in response to defendant's argument that the repeal of former section 1714.45 should
not be given "ex post facto" effect, and once in connection with defendant's argument that "conduct immunized by section
1714.45 should not be considered in support of a punitive damages award."
The rule of / was not an unforeseeable departure from existing law but one of two or three obvious possibilities in a patently
unsettled area. Defendant has not shown that it could not be expected to anticipate this rule or, indeed, that it did not
actually anticipate it. Defendant has thus failed to bring itself within the cases permitting a new point to be raised on
appeal based on the effect of an intervening change in law.
We also note that few if any cases invoking the exception for points based on new authority rely on that exception alone.
Instead, most or all of them present additional grounds for exception, such as that the new point raises pure issues of law on
undisputed facts or affects a matter of public interest or policy, or both. Neither of these additional factors is present here.
The application of section 1714.45 does not raise a pure question of law on undisputed facts but affects only the
admissibility of evidence or the purposes for which it may be considered. If defendant's newly asserted objections were to
succeed on appeal, the necessary result would be a retrial of liability or punitive damages, or both. Nor does the question
implicate the public interest or public policy. The major issues concerning the application of former section 1714.45 have
now been authoritatively resolved by and Our consideration of the merits would therefore relate almost solely to the issue
of prejudice. (See [point "arguably raise[d] an issue of great public importance," but since intervening authority had decided
the point "it is not necessary for this court to address the issue" (italics omitted) ], disapproved on another point in
E.g., (point rested on "intervening clarification of the law" and resolution of issue depended on undisputed facts);
(pure question of law, undisputed facts, important questions of public policy);
("question of law based on
undisputed facts");
("question of law determinable from a factual situation already present in the record");
("matter of intense public and legal concern").
E. Futility.
[10] Defendant asserts that it would have been futile to argue for an immunity window because the trial court's rulings show
that it would have rejected any such argument. This argument takes two slightly different forms. The first variation, which
appears primarily in the briefs, is that the trial court's rulings show that it would in fact have rejected the idea of an
immunity window if that idea had been presented to it. The second variation, which defendant pressed at oral argument, is
that the idea of an immunity window is logically incompatible with the trial court's supposed ruling that section 1714.45
was "not retroactive," such that the trial court could not have given the instruction now sought by defendant without
contradicting itself.
Nothing cited by defendant or found by us substantiates the assertion that the trial court would have rejected a proper
request for relief based on an immunity window. According to defendant, "the trial court ... held that [in repealing former
section 1714.45] the Legislature ... intended to abolish all of Philip Morris' immunity...." (Italics defendant's.) Defendant
provides no record citation for this assertion. Elsewhere defendant cites a six- page portion of the proceedings in support of
a claim that the trial court held "that the Repeal Statute was retroactive and, therefore, eliminated any right of Philip
Morris to assert immunity." (Italics added.) Defendant cites the same six pages for the premise that "[i]n denying the
motion [for nonsuit], the trial court found that the Repeal Statute operated retroactively and, therefore, that no aspect of
Philip Morris' immunity survived." (Italics in original.)
Nowhere in the cited proceedings did the trial court issue any such categorical ruling, or indeed express any relevant legal
opinion. The court's only comment with respect to the motions for nonsuit and directed verdict was, "The court is denying
each of the defense motions." Defendant must rely on what it contends was implicit in the trial court's rulings. The only
necessary implication of those rulings was the trial court's rejection of defendant's contention that former section 1714.45
afforded it a complete defense so as to require judgment in its favor. That ruling was entirely sound.
[11][12] The record is similarly devoid of support for defendant's contention that in ruling on defendant's motion for new
trial, the trial court necessarily repudiated any idea of an immunity window. It is true, as we have noted, that defendant's
memorandum in support of a new trial alluded to such a concept. However the trial court's order denying the motion for
new trial discussed former section 1714.45 only as defendant had presented it during trial, i.e., as an assertedly complete
bar to liability. Defendant emphasizes that plaintiff did not assert, and the trial court did not find, that defendant had
waived the claim of an immunity window. We reject any notion that a point not otherwise preserved becomes cognizable on
appeal merely because the opposing party fails to assert waiver in the trial court. The purpose of the rule is to avoid
needless retrials and to encourage parties to make their best case when the opportunity is presented to them. An objection
which should have been raised prior to the verdict, but was not, is no more worthy of consideration on motion for new trial
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than it is on appeal. (See The trial court was entitled to ignore defendant's belated suggestion of instructional error
without explicitly finding a waiver of the point.
The court wrote: "Philip Morris urges that California's ten year exemption of tobacco manufacturers from liability,
as reflected in former Civil Code § 1714.45, bars most of plaintiff's claims. This Court disagrees. Whereas the
exemption was in effect between 1988 and the end of 1997, plaintiff smoked, and became addicted to, Philip Morris'
cigarettes in the decades before the exemption went into effect and was first diagnosed with lung cancer after the
exemption was lifted. It would be an odd and illogical result, unsupported by the law, if an exemption were to bar
an action brought by a person who (a) became addicted to a product as a result of wrongful conduct occurring before
the commencement of the exemption, and (b) was diagnosed with disease only after its termination. Moreover,
present evidences the clear legislative intent to hold tobacco manufacturers accountable in situations such as that
presented in the case at bar." (Italics added.)
As the court observed in the opportunity to retry newly raised issues after a reversal on appeal is not enough to
secure "fairness to the litigants": "Litigation is an adversary process contemplating an element of risk to all parties.
To permit a change of theory on appeal is to allow one party to deal himself a hole card to be disclosed only if he
loses. Even if that device does no more than give him a second chance, it has unbalanced the inherent risk of the
litigation and put the other party at a disadvantage. Such a process is to be allowed if at all only under unusual
circumstances--as for example where the question is purely one of law so that it cannot be said that the balance of
litigation risk was altered by the failure to raise it at trial." (See [quoting this passage in context of stipulation
withdrawing issue from jury].)
[13] At oral argument defendant asserted that the concept of an immunity window conflicts irreconcilably with the trial
court's implicit holding that the repeal was "retroactive." This argument assumes that "retroactivity" is a single fixed
characteristic which is either present or absent in a particular statute. In fact the term has many meanings and shades of
meaning, and whether a particular application of a given statute is "retroactive" may depend on what exact meaning is
intended. In the court frankly acknowledged that "deciding when a statute operates 'retroactively' is not always a simple or
mechanical task." Rather, "[t]he conclusion that a particular rule operates 'retroactively' comes at the end of a process of
judgment concerning the nature and extent of the change in the law and the degree of connection between the operation of
the new rule and a relevant past event. Any test of retroactivity will leave room for disagreement in hard cases, and is
unlikely to classify the enormous variety of legal changes with perfect philosophical clarity." italics added.)
Defendant treats the trial court's rulings as implicitly holding the 1998 repeal "retroactive" in all respects and for all
possible purposes. This treatment is unwarranted. Former section 1714.45 was only offered to the trial court as a complete
defense, i.e., as though the 1998 repeal had no effect whatever on the application of the former statute. Indeed defendant
stated as much, writing in its nonsuit memorandum that "[T]he September [1997] amendment [i.e., repeal] has no bearing
on the present action." (Italics added.) Thus the only question before the trial court was whether the repeal of that statute
was "retroactive" in the broad sense that it permitted plaintiff to assert some claims that would have been barred under the
former statute. The trial court correctly answered that question in the affirmative. In doing so it did not need to decide, and
did not purport to decide, whether the repeal might be less than wholly retroactive, such that some claims barred under the
former statute remained barred, or limited, after the repeal. Accordingly the court did not decide, in fact or by necessary
implication, that no immunity window existed.
Nothing in this record substantiates the claim that it would have been futile to request the instruction defendant now
contends was erroneously omitted.
F. Affirmative Misdirection.
[14] Defendant also contends that we may entertain its claim of "instructional error," despite the lack of appropriate
objection below, because the trial court "gave instructions that were affirmatively erroneous" when it "instructed the jury to
'consider all of the evidence bearing upon every issue." (Italics defendant's.) Defendant thus invokes the rule that
instructions affirmatively misstating the law may be challenged on appeal even though the complaining party did not object
to them in the trial court. (See .)
[15] The cited rule applies only to instructions containing "an incorrect statement of the law, in contrast to a claim that the
instruction is too general or incomplete."
see Here the challenged instruction, which is part of , told the jury that it
"should consider all of the evidence bearing upon every issue, regardless of who produced it." (Italics added.) This is a correct
statement of law as far as it goes. It does not tell the jury to give any effect it chooses to evidence that has been stricken or
admitted for a limited purposes. It merely tells the jury to consider all evidence "bearing upon" a given issue. The manifest
purpose and effect of the instruction is to discourage the jury from arbitrarily disregarding evidence. Here, had defendant
sought and obtained an instruction concerning the immunity window, the jury would have understood that evidence of
immunized conduct did not "bear[ ] upon" some of plaintiff's claims. At worst the cited instruction was "too general or
incomplete" on the point now asserted by defendant.
To conclude otherwise would cause this boilerplate standard instruction to overturn the rule, codified at , that a
party may not complain of the erroneous admission of evidence unless he or she lodges an appropriate objection at
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trial. Defendant implicitly concedes that it cannot complain of the admission of evidence of immunized conduct
since it raised no objection to that evidence when it was introduced and sought no contemporaneous admonition as
to the limited purposes for which it could be considered. Defendant's claim of "instructional error" is really a claim
that such an admonition should have been given at the conclusion of trial. We question whether a party can sit
mute while objectionable evidence is admitted for all purposes and then claim an entitlement to a jury instruction,
which amounts in effect to a belated admonition as to limited admissibility. We need not decide the point, however,
because defendant neither objected to the evidence when it was admitted nor requested the instruction to which it
now asserts an entitlement.
[16] Furthermore, defendant expressly invited the court to give this instruction. As discussed in greater detail in the
following part, defendant joined in a stipulation that, with two exceptions, all of the court's instructions were deemed to
have been requested by both parties. Defendant contends that it preserved its objection to the claimed " instructional error"
by raising former section 1714.45 in its motions for nonsuit and directed verdict. As we have noted, however, nothing in
those motions or otherwise before the court suggested that the jury should be instructed as to an immunity window. If
defendant wished to raise such a point, it was required under the stipulation to do so by specific contemporaneous objection.
Indeed it made such an objection with respect to a conceptually similar point, i.e., that the court should limit the jury's
consideration of plaintiff's conspiracy theory to the period before July 1969, as it did with the failure to warn theory.
Defendant has never offered any reason for not making a similar point with respect to the jury's consideration of conduct
during the immunity period. It follows that the cited sentence from was given at the stipulated request of both parties.
Under the doctrine of invited error, a party "cannot complain of an erroneous instruction where he requested the instruction
given or one substantially similar to it." (9 Witkin, Cal. Procedure, supra, § 384 at p. 435, italics omitted.) Having
requested the instruction now challenged, defendant cannot complain of it.
In sum, the trial court did not err in rejecting defendant's only request for relief under --its motions for nonsuit or directed
verdict. The argument for error now made--that the court erroneously permitted the jury to hear evidence of immunized
conduct without instructing the jury on the limited purposes for which it could consider that evidence--was never suggested
to the trial court by a request that it should withhold such evidence from the jury or instruct it on such limited purposes.
Defendant has offered no excuse for this failure and has pointed to no facts either bringing it within the usual exceptions to
the requirement of predicate trial court objections or justifying the creation of a new exception. Accordingly, no cognizable
error appears in connection with the application of former section 1714.45 in this case.
II.
FEDERAL PREEMPTION
[17] Defendant contends that many or all of the legal grounds on which the jury was permitted to impose liability were
preempted by the Public Health Cigarette Smoking Act of 1969, et seq. (the 1969 Act). The only specific errors suggested
are that (1) the court erroneously permitted the jury to consider evidence made inadmissible by the 1969 Act, and (2) the
trial court gave an instruction overstating the extent to which the jury could find liability consistent with federal law.
As italicized in defendant's brief, the challenged instruction provided in part: "[B]ecause of federal law, and except
only as stated below, you may not base any findings of liability on a determination that (a) defendant Philip Morris,
through its advertising or promotional practices, neutralized, minimized or undermined the effect of the federallymandated warnings after July 1, 1969, or (b) defendant Philip Morris, after July 1, 1969, failed to disclose, or
concealed or suppressed, information about the health risks of smoking. [¶ ] The federal law does not limit the
potential liability of Philip Morris against claims that it made misrepresentations about the health risks of smoking
or that it conspired with other cigarette companies to conceal, suppress, or misrepresent information regarding the
health effects of smoking."
[18] The suggestion of evidentiary error is too vague for appellate consideration. No particular ground of exclusion is
offered. We may infer that defendant relies on the premise that preemption rendered certain evidence irrelevant, but we
will not address errors at the very nature of which we are forced to guess. Furthermore defendant makes no attempt to
establish that any pertinent objection has been preserved for appeal by timely interjection in the trial court. (See .) We
therefore pass this claim without further consideration.
[19] Defendant waived much of its instructional objection by express consent and invitation. Defendant stipulated in open
court that all instructions actually read to the jury were given at the "request and the invitation" of both parties except
insofar as objections were embodied or expressed (1) in certain dispositive motions denied just before the stipulation was
entered; (2) by express statement immediately after entry of the stipulation; or (3) immediately after the reading of
instructions, insofar as any party might assert that the instructions as read did not conform to those called for by the
stipulation.
Defendant does not claim to have asserted federal preemption as a ground for any of the motions to which the stipulation
referred, and appears not to have done so. This stands to reason since preemption by the 1969 Act furnishes no defense to
claims arising before its effective date. As for express objections voiced after the stipulation was entered, defendant lodged
exactly one: namely, that the instructions were erroneous insofar as they allowed a verdict for plaintiff based on a theory of
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255
conspiracy to conceal after July 1, 1969. Counsel stated that defendant's "only objection" was that the instructions failed "to
incorporate the July 1, 1969 limitation as it relates to the conspiracy to conceal claim." (Italics added.)
[20][21] No party will be heard to complain of an error it invited.
["a party cannot successfully take advantage of error
committed by the court at his request."]; see Defendant is not relieved of this rule by , which states that jury instructions
are among judicial actions "deemed excepted to" without an express exception. ( The statute only means that "an appellant
is deemed to have excepted to the instructions he has not requested or agreed to." italics added; see quoting ["The invited
error doctrine applies 'with particular force in the area of jury instructions.' "].)
By the express terms of the stipulation, defendant "request[ed] and invit[ed]" the instruction complained of except insofar as
it allowed recovery for conspiracy to conceal after 1969. Defendant cannot enlarge this objection on appeal so as to argue
that the jury was improperly permitted to consider other theories in connection with post-1969 events and conduct.
[22][23][24] With the issue thus narrowed, we find it unnecessary to decide whether the instruction accurately states the
scope of federal preemption because it is impossible to say that the verdict was probably affected by any cognizable error.
"To prevail on a claim of instructional error, the appellant must show a reasonable probability of a more favorable result in
the absence of the error." In considering whether it " ' "seems probable" that the error "prejudicially affected the verdict," '
" a reviewing court "should consider not only the nature of the error ..., but the likelihood of actual prejudice as reflected in
the individual trial record, taking into account '(1) the state of the evidence, (2) the effect of other instructions, (3) the effect
of counsel's arguments, and (4) any indications by the jury itself that it was misled.' " quoting The burden is on the
complaining party to "demonstrate [that] a miscarriage of justice arose from the erroneous instruction."
[25] Defendant's showing here falls far short of demonstrating that an instruction barring liability for conspiracy to conceal
after 1969 would probably have affected the outcome. The jury found for plaintiff on all eight legal theories embodied in the
instructions, i.e., (1) supplying a product that failed to perform as safely as an ordinary consumer would expect it to perform;
(2) supplying a product before 1969 while failing to give adequate warning of its dangerousness; (3) simple negligence; (4)
breach of express warranty; (5) intentional misrepresentation; (6) fraudulent concealment; (7) fraudulent promise; and (8)
negligent misrepresentation. The jury also found that defendant committed conspiracy to defraud by concealment,
suppression, or misrepresentation of the health effects of cigarette smoking. Only one of these findings (conspiracy to
commit fraudulent concealment) is affected by the alleged error before us, and it is only partially affected; a holding in
defendant's favor would only mean the jury could not find for plaintiff on that theory on the basis of post-1969 conduct. On
the face of the special verdict alone, it appears unlikely that such a limitation would have had any effect on the ultimate
finding of liability.
[26] Defendant argues that the court's error with respect to preemption was prejudicial in that it caused the court to
"improperly allow[ ] into evidence a mass of documents and testimony" concerning post-1969 advertising, failures to warn,
and concealment of health risks. This is not a showing of "prejudice," but an attempt to charge evidentiary error without
laying the necessary foundation. (See .) Defendant makes no coherent showing that this evidence was not admissible for a
proper purpose unrelated to concealment, e.g., to establish scienter in support of a claim for fraud. Fraud is outside the
preemptive scope of the 1969 Act. )
[27] Defendant's next claim of prejudice is that in argument to the jury, plaintiff's counsel relied heavily on the supposedly
preempted theory embodied in the challenged instruction. The passages cited by defendant, however, concern not
conspiracy to conceal after 1969, but inadequate package warnings before 1969. In her first allusion to package warnings
counsel said, "[W]hen Patricia started smoking at age 15 in 1961, there was nothing on the package. There was no warning."
(Italics added.) Counsel went on to argue that given the health risks posed by cigarettes, "you'd expect to see a skull and
crossbones on it (indicating). You'd expect to see the word 'Poison' on it." Counsel next alluded to package warnings in
connection with the first warning mandated in 1965, which counsel denounced as inadequate to deter plaintiff, by this time
"a regular smoker [who] needed her cigarettes." Federal law posed no impediment to this argument, and defendant does not
suggest otherwise.
The specific passage cited by defendant echoed the earliest one in its reference to a skull and crossbones, and also followed,
if at slightly greater distance, explicit references to plaintiff's original acquisition of the smoking habit. Thus counsel
conceded plaintiff's inability to specify a date and advertisement that caused her to begin smoking Marlboros. Instead,
counsel said, plaintiff had started smoking Marlboros because of a " 'cute guy at school' " who " 'looked like the Marlboro
Man.' " Counsel then discussed defendant's use of the "Marlboro Man" as a symbol of independence particularly appealing to
teenagers. To support this argument counsel read aloud from, apparently, a 1976 Philip Morris memorandum quoting a
1969 source which itself was apparently derived from an earlier source. Counsel argued that defendant exploited the
symbolism of the Marlboro Man in order to induce teenagers to start smoking its products: "You don't become the No. 1
cigarette brand because you don't appeal to teenagers. That's the only way that you get starters. Starters equal children.
And children do not make informed choices. [¶ ] And had that [apparently indicating image of skull and crossbones]
appeared on the pack, there's a greatly [sic ] likelihood that somebody would see that, instead of a red and white color
package that looks so nice.... That's the kind of warning that would be paid attention to...."
Given this context we find it curious that defendant characterizes these remarks as having been made "without any
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distinction as to time." Indeed plaintiff's counsel told the jury, if somewhat elliptically, that it could not predicate liability
on a failure to warn after 1969. She went on to argue that the jury should find for plaintiff on a consumer expectations
theory because the years preceding 1969 were "the time frame when [plaintiff] was ... becoming hooked." Nothing in
counsel's argument provides any basis to think that the jury relied on a theory of post-1969 conspiracy to conceal, or that
had it been expressly forbidden to do so it would have found for defendant on any other theory--let alone all of them.
III.
STRICT PRODUCTS LIABILITY
A. Post-1969 Defect Under "Consumer Expectations Theory."
Defendant contends that, for a variety of reasons, plaintiff was not entitled to judgment on her theory of strict tort liability
for manufacture of a defective product. The jury was instructed by stipulation that this claim was established if, as
pertinent to this appeal, plaintiff was injured as the result of a design defect in a product manufactured by defendant. A
product is defective, the jury was told, if (1) it "fails to perform as safely as an ordinary consumer would expect when used in
an intended or reasonably foreseeable manner"; or (2) its use in a foreseeable manner involves a substantial danger not
readily recognized by the ordinary user, the danger was known or knowable at the time of manufacture in light of generally
recognized and prevailing scientific and medical knowledge, and the manufacturer "failed to give an adequate warning of
that danger before July 1, 1969."
[28] Defendant asserts that the trial court erred by permitting plaintiff's "consumer expectations" claim to go to the jury
without restricting it to the time before the effective date of the 1969 Act. We have serious reservations about the soundness
of this argument, which sounds in federal preemption, but we need not decide the issue because the point is barred by the
parties' stipulation. (See pt. II., above.) Defendant argues that it preserved the point by objecting to the portion of the
instructions permitting the jury to find conspiracy to conceal after 1969. We fail to see how. Under the stipulated portions
of the instructions the jury was free to return a verdict for plaintiff if it found that the cigarettes smoked by her were at any
time more dangerous than the ordinary consumer of cigarettes would expect. The jury obviously made such a finding, which
was supported by overwhelming evidence.
B. Failure to Heed Warnings.
Defendant asserts two related arguments to the effect that the presence of package warnings barred recovery on a products
liability theory as a matter of law.
[29] First, defendant contends that a product labeled with mandatory warnings "cannot" be found to "fail California's
consumer expectations test." Insofar as this argument hints at federal preemption it is not cognizable on appeal for the
reasons already stated. We address it solely as a proposition of California tort law. We find no persuasive basis for it in the
cases cited by defendant.
In cert. denied, the court affirmed a summary judgment for a tampon manufacturer on a claim that its product caused the
plaintiff to suffer toxic shock syndrome. Defendant cites the case for its disposition of the plaintiff's consumer expectations
claim in two terse sentences: "Tambrands' warnings met the federal requirements and Papike's design defect claim
therefore fails the 'consumer expectation' test. To rule otherwise would allow the anomalous circumstance that a consumer
is entitled to expect a product to perform more safely than its government- mandated warnings indicate."
We are
unpersuaded that these comments conform to California law, at least if taken outside the facts of that case. The warnings
there might well have justified summary judgment for the defendant, because they explicitly notified the user of the very
danger at issue and there is no suggestion of any countervailing evidence raising a genuine material issue of fact as to the
likely expectations of consumers. The court's unilluminated statement that liability would be "anomalous" does not furnish
a sufficient ground to take the matter from the jury.
In the court held that insecticide makers had no duty to issue warnings to the public in connection with an emergency
insect eradication program, where the state had already issued warnings required by applicable statutes. The holding did
not rest on some presumption that the mandatory warnings were adequate as a matter of law, but on the injudiciousness of
requiring private parties to "interfere with" the state's emergency efforts.
In the court affirmed a summary judgment on the ground that the warning given there was sufficient as a matter of law, as
shown by the evidence. Nothing in that decision suggests that a government-mandated warning categorically bars liability
for a product otherwise shown to be more dangerous than ordinary consumers expect. Other cases cited by defendant do not
purport to apply California law, and are not persuasive on the point at issue. (See [tampons came within Illinois rule for
"simple products," and were not unreasonably dangerous given specificity of warnings and plaintiff's admission that she
read them];
[federal labeling act preempted claim under Virginia law that insecticide was defective under consumer
expectations theory].)
[30] Defendant's second argument concerning package warnings is that plaintiff's supposed failure to heed warnings
precludes, as a matter of law, a finding that any defect in the product was a proximate cause of her injuries. This argument
seems to proceed as follows: (1) where a product bears government-mandated warnings, they must be presumed sufficient
to apprise the user of the steps necessary to avoid injury; (2) where a plaintiff fails to take such steps, his or her conduct is a
superseding cause of any injury she suffers; (3) had plaintiff quit smoking in compliance with package warnings, "she
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almost certainly would not have developed lung cancer from smoking"; therefore (4) any defect in defendant's product was
not a proximate cause of plaintiff's injuries.
In support of the first point defendant cites four cases for a proposition they do not remotely support, i.e., that "[u]nder
California law, a plaintiff's failure to heed a product warning negates any potential liability because, under such
circumstances, the plaintiff's own conduct, not a product defect, is the proximate cause of the plaintiff's injury." In the
court reversed a summary judgment for a defendant based on its claim that its product warnings were adequate as a matter
of law; the court assumed the proposition, conceded by the plaintiff, that "where adequate warnings have been passed along
from manufacturer or seller to the ultimate consumer, there can be no liability." (Italics in original.) It cited where a jury
verdict for a ski binding maker was affirmed over the plaintiff's argument that the defendant breached a duty to warn as a
matter of law; the court held that the defendant's duty was discharged by giving appropriate warnings to the ski shop that
installed the bindings. Similarly, in the court affirmed a jury verdict for a drug manufacturer despite a failure to warn the
plaintiff, where adequate warnings were given to her physician.
Defendant apparently cites for its general discussion of failure to warn as a species of product defect. Aside from the
inaptness of this discussion to the question of proximate cause, portions of the decision contradict defendant's position.
Most notably, the court said that a product bearing an adequate warning, " 'which is safe for use if it is followed, is not in
defective condition, nor is it unreasonably dangerous.' " quoting , com. j, italics added.) Defendant points to only one
warning here that ever gave any instruction to be "followed"--a statement that "Quitting Smoking Now Greatly Reduces
Serious Risks to Your Health." This warning was not adopted until October 12, 1984, and was not required to appear until
one year after enactment. ( (Oct. 12, 1984) 98 Stat. 2202.) Plaintiff had then been smoking for some 23 years. We are
directed to no evidence concerning the medical probability that quitting in 1985 would have affected the course of her
illness. In any event does not support the point for which it is cited.
Likewise is concerned not with proximate cause but with the kind of contributory negligence that will constitute a defense to
a product liability claim. " 'For such a defense to arise,' " the court wrote, " 'the user or consumer must become aware of the
defect and danger and still proceed unreasonably to make use of the product.' " italics added; see [discussing , com. n, and
other authorities on " 'assumption of risk' " in strict liability cases].) Defendant apparently waived any such defenses; the
stipulated instructions included none on these subjects. The decision therefore has no bearing on this appeal.
C. Reliance on Expert Testimony.
[31] Defendant also contends that the jury's finding of liability on a consumer expectation theory rests impermissibly on
expert testimony. This argument depends upon a misconstruction of concerning the general impropriety of relying on expert
witnesses to establish the expectations of the ordinary consumer. The actual holding is that "where the minimum safety of a
product is within the common knowledge of lay jurors, expert witnesses may not be used to demonstrate what an ordinary
consumer would or should expect." italics added.) In a footnote, the court confirmed, in the context of "specialized"
products, the implied corollary of the above rule: "[I]f the expectations of the product's limited group of ordinary consumers
are beyond the lay experience common to all jurors, expert testimony on the limited subject of what the product's actual
consumers do expect may be proper." This rationale would seem to authorize the admission of expert testimony at least for
the purpose of establishing what smokers expected at various times in the past, most particularly during the critical period
when plaintiff began to smoke and became "hooked."
We do not consider two related questions, not presented in concerning the applicability of its holding where (1) the
ordinary user of a product may be predisposed by psychological and pharmacological factors associated with its use
to perceive its risks differently than do other members of the public, and (2) the "minimum safety" of the product is
a matter of public controversy as to which consumers have been exposed to a variety of conflicting opinions,
assertions, and sophisticated propaganda techniques intended to neutralize any perception of danger.
[32] Defendant extracts from the proposition that "[b]y using experts, plaintiff disqualified herself as a matter of law from
relying on a 'consumer expectations' theory...." In other words, by merely proffering expert testimony, plaintiff waived her
consumer expectations theory. The proposition is absurd if only because expert witnesses may well be called on issues
having nothing to do with consumer expectations.
Furthermore, the argument again rests on supposed evidentiary and
instructional errors that are not separately stated or sufficiently demonstrated on appeal and are not shown to have been
raised below. If defendant's argument was sound, the remedy was to attempt to exclude the expert testimony or withhold
the consumer expectations theory from the jury--not to suffer admission of the testimony, stipulate to the jury's
consideration of the theory, and then seek reversal on appeal.
D. Inherently Dangerous Product: Comment i and .
Defendant next asserts that plaintiff's product liability claims were barred by the doctrine stated in comment i to (comment
i ) and . Two distinct errors seem to be asserted. One is that the claims were barred as a matter of law and thus, by
implication, should not have been submitted to the jury at all. The other is that the court committed "instructional error" by
refusing a supposed request to give .
[33] The claim of instructional error has been waived. Defendant asserts in its reply brief that it requested the instruction
in connection with all of plaintiff's product liability theories. No such request is cited. Instead, at the cited point in the
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transcript, both counsel agreed with the court's statement "that the defense did request that the court give 9.006 [sic ] on the
risk/benefit prong of Barker versus Lull." This was an allusion to a specific theory of product liability asserted by plaintiff.
(See In response to that limitation, plaintiff expressly abandoned the theory. As a result, the court did not give . If
defendant was in any way surprised by this, it was required under the parties' stipulation to object no later than
immediately after the instructions were read. It did not do so.
In the face of this record defendant states that "[f]or reasons not explained on the record, the trial court was willing to give
had plaintiff proceeded to trial on a risks/benefits design defect theory, but refused to give the instruction on the consumer
expectations and failure to warn claims...." The court did not "refuse" to do anything; it omitted an instruction that it
apparently believed defendant had only requested conditionally. Its reasons were anything but unexplained: the condition
under which defendant requested the instruction had ceased to exist. If the court was mistaken, it was up to defendant to
say so, not let the matter pass and then offer it on appeal as grounds for a retrial.
[34] This leaves defendant's argument that the doctrine embodied in comment i and entitled defendant to judgment as a
matter of law. Defendant cites six motions or memoranda raising related points; none raises this specific argument.
Nonetheless, this is the kind of argument that, if limited to its potential as a complete bar to liability, we may consider on
appeal notwithstanding the failure to raise it below. The problem with defendant's many other arguments of similar nature
is that they depend on factual predicates, such as package warnings, that do not pertain to the entire period at issue in this
suit. As a result they raise only a partial defense. If comment i actually raised a categorical bar, as defendant now contends,
the bar might well extend to the entire period at issue. Defendant's argument fails, however, because to the extent comment
i reflects California law, it does not furnish a categorical defense but a question of fact--or multiple questions of fact--for the
trier of fact.
Comment i is a gloss on the general rule that "[o]ne who sells any product in a defective condition unreasonably dangerous
to the user or consumer ... is subject to liability for physical harm thereby caused...." (, subd. (1).) The entire point of
comment i is to emphasize and enlarge upon the requirement that the product must be "unreasonably dangerous." This
requirement "was added to foreclose the possibility that the manufacturer of a product with inherent possibilities for harm
(for example, butter, drugs, whiskey and automobiles) would become 'automatically responsible for all the harm that such
things do in the world.' " quoting Prosser, Strict Liability to the Consumer in California (1966) 18 Hastings L.J. 9, 23.)
Comment i provides: "i. Unreasonably dangerous. The rule stated in this Section applies only where the defective
condition of the product makes it unreasonably dangerous to the user or consumer. Many products cannot possibly
be made entirely safe for all consumption, and any food or drug necessarily involves some risk of harm, if only from
over- consumption. Ordinary sugar is a deadly poison to diabetics, and castor oil found use under Mussolini as an
instrument of torture. That is not what is meant by 'unreasonably dangerous' in this Section. The article sold must
be dangerous to an extent beyond that which would be contemplated by the ordinary consumer who purchases it,
with the ordinary knowledge common to the community as to its characteristics. Good whiskey is not unreasonably
dangerous merely because it will make some people drunk, and is especially dangerous to alcoholics; but bad
whiskey, containing a dangerous amount of fu[ ]el oil, is unreasonably dangerous. Good tobacco is not unreasonably
dangerous merely because the effects of smoking may be harmful; but tobacco containing something like marijuana
may be unreasonably dangerous. Good butter is not unreasonably dangerous merely because, if such be the case, it
deposits cholesterol in the arteries and leads to heart attacks; but bad butter, contaminated with poisonous fish oil,
is unreasonably dangerous."
[35] In the court held that the "unreasonably dangerous" requirement is not part of California's law of strict product
liability. This holding remains good law. (See
) Indeed, except as modified by (see pt. I., above), it has been
legislatively ratified. (, subd. (d).) Defendant acknowledges this while still asserting that comment i, which serves only to
illuminate this inapplicable requirement, states the rule applicable to this case. Defendant cites no California case since
that has applied the comment or endorsed its application. (Cf.
Not only does comment i explicate a rule that is not part of our law, it does not by its terms support the categorical bar to
recovery defendant would have us adopt. The comment states that to warrant liability, the product must be "dangerous to
an extent beyond that which would be contemplated by the ordinary consumer." (, com. i, italics added.) This invites a
showing by an injured smoker that while cigarettes may have been generally known or believed to pose hazards, they were
in fact far more dangerous than was "contemplated by the ordinary consumer." In arguing otherwise, counsel misrepresents
applicable authority. In the reply brief counsel writes, "Under Comment i, it is not necessary that the ordinary consumer
know or understand every possible risk associated with smoking, so long as cigarettes are 'known to be unsafe.' See (there
is 'no requirement ... that consumers fully appreciate all the risks involved')." (Italics added.) The quoted passage actually
states: "As to the second and third claims, there is no requirement under this statute [former § 1714.45] that consumers
fully appreciate all the risks involved in the use or consumption of the products within the purview of this section. In order
to be covered by this statute it is sufficient that the ordinary consumer knows the product is 'unsafe.' " original italics
omitted, new italics added.) The court then goes on to say that but for the statute, the situation could well be different:
"Evidence that the risks are greater than those anticipated, either because the product contains unknown dangerous
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259
elements or because it may be used in conjunction with substances that unknowingly increase the risks involved, could
possibly be used to support a claim that the product is defective under the standards outlined in (see Discussion, )" italics
added.)
Defendant has failed to demonstrate any entitlement to judgment as a matter of law on the authority of comment i.
E. Generally Recognized Danger: Comment j.
[36] Next defendant contends that it should receive some kind of appellate relief on the authority of comment j to , which
concerns the effect on a failure-to-warn theory of common knowledge of a product's risks. Defendant does not mention in
this context any proceedings in the lower court by which this issue was raised or preserved for appeal. We observe, however,
that it was one basis for a motion for judgment notwithstanding the verdict. Even viewing the brief as containing an
adequate specification of error, the argument on this point is woefully deficient, as epitomized in the assertion that
"[b]ecause plaintiff knew of and accepted the risks of smoking, PM cannot be strictly liable to her." Plaintiff denied that she
"knew of and accepted the risks of smoking" as they affected her, and indeed presented evidence that few people outside the
research community and the tobacco industry appreciated the risks of smoking at the time she was becoming "hooked." In
the absence of a compelling showing to the contrary, we presume the jury accepted this testimony and otherwise made any
findings necessary to reject defendant's factual premise. Defendant's one-page argument on appeal does not include a
compelling showing.
IV.
FRAUDULENT MISSTATEMENT
A. Misstatement.
Defendant contends that plaintiff failed to establish two elements of her claims for fraudulent misstatement and fraudulent
promise, i.e., a false representation of fact (or actionable false promise) and actual reliance by plaintiff. As defendant puts
it, plaintiff presented "no evidence of a misrepresentation of material fact" and "no evidence of actual reliance or causation."
[37][38][39] A claim of "no evidence" is a claim of insufficient evidence to support the challenged findings. One raising such
a claim assumes a "daunting burden." ( We must presume that the record contains substantial evidence to support every
finding necessary to support the judgment. ( To overcome this presumption, the party challenging a finding "must
summarize the evidence on that point, favorable and unfavorable, and show how and why it is insufficient. " italics added.)
Where a party presents only facts and inferences favorable to his or her position, "the contention that the findings are not
supported by substantial evidence may be deemed waived."
[40] Defendant makes no attempt to provide a fair summary of the evidence on which the findings of fraudulent
misrepresentation and reliance might (and presumptively do) rest. We recognize that the record is exceptionally large, the
scope of proof vast, and the limitations on brief length constraining. Fairness might require relaxation of the foregoing
requirement if defendant had made a good faith effort to comply with it by at least identifying the evidence most favorable to
the judgment. Defendant, however, has made no attempt to set forth the evidence most supportive of the finding and to
"show how and why it is insufficient."
Our review of the record satisfies us that there was substantial evidence, which
defendant does not cogently dispute for purposes of this appeal, that it engaged in a conscious, deliberate scheme to deceive
the public, and individual smokers and potential smokers (many or most of whom it knew to be adolescents), about the
health hazards and addictive effects of cigarette smoking. The jury could properly find that commencing no later than 1953
and continuing at least until the time of plaintiff's diagnosis, defendant and other cigarette manufacturers acted both in
concert and individually to issue innumerable false denials and assurances concerning the dangers of smoking, deliberately
fostering a false impression by the public, or more precisely by smokers and prospective smokers, that assertions of health
risk were overblown products of puritanical prejudice, that any real hazards had yet to be shown, and that the industry
itself was acting and would act diligently to discover the scientific truth of the matter and promptly disclose its findings,
good or bad. The jury could also find that plaintiff heard of these false assurances and denials, if only indirectly, and was
falsely led to believe, as defendant intended, that there was a legitimate "controversy" about whether cigarettes actually
caused cancer or carried any other serious health risks. As a consequence of that information and the distorted judgment
brought about by addiction, she was unaffected by reports of adverse health effects because she was unpersuaded they were
true or reliable enough to warrant any action by her.
[41][42][43] Defendant contends that many of the statements alleged by plaintiff were matters of opinion and thus not
actionable. This argument relies on the general rule that statements of opinion will not support an action for fraud, while
ignoring the exception on which the jury was instructed, and which it presumptively found applicable to any statements of
opinion: " '[W]hen one of the parties possesses, or assumes to possess, superior knowledge or special information regarding
the subject matter of the representation, and the other party is so situated that he may reasonably rely upon such supposed
superior knowledge or special information, a representation made by the party possessing or assuming to possess such
knowledge or information, though it might be regarded as but the expression of an opinion if made by any other person, is
not excused if it be false.' " quoting Further, if a statement of opinion " 'misrepresents the facts upon which it is based or
implies the existence of facts which are nonexistent, it constitutes an actionable misrepresentation.' " quoting The jury
here was entitled to find that insofar as any of defendant's statements constituted opinions, they implied the existence of
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superior knowledge as well as a state of facts that did not exist.
B. Reliance and Causation.
Defendant contends that even if plaintiff showed an actionable misrepresentation, she failed to show that she actually and
reasonably relied on anything defendant said or failed to say. Likewise defendant suggests that plaintiff failed to show the
closely related element of causation.
[44] Defendant incorrectly asserts that "[t]here is no evidence that plaintiff ever saw or heard ... any ... statements by
[defendant] (or other cigarette manufacturers) relating to the health risks of smoking." Defendant ignores plaintiff's
testimony that while she recalled " listening and seeing things that the Surgeon General was saying," she was also aware
"that the tobacco companies were saying different." (Italics added.) Thus, she testified, package warnings never "faze[d] me
one way or the other. I wasn't going to give the cigarettes up at that point." The jury was entitled to find that by this time,
in her addicted state, plaintiff was easy prey for defendant's disinformation campaign and readily clutched at the industry's
caricature of objective inquiry.
[45][46] Contrary to defendant's implicit contention, plaintiff did not have to prove that she heard these matters directly
from defendant, or from any of its coconspirators. It was enough that the statements were, as the jury was entitled to find,
issued to the public with the intent that they reach smokers and potential smokers, and that plaintiff, as a member of that
class, heard them. As the jury was correctly instructed, "One who makes a misrepresentation or false promise or conceals a
material fact is subject to liability if he or she intends that the misrepresentation or false promise or concealment of a
material fact will be passed on to another person and influence such person's conduct in the transaction involved." (See ;
[summarizing principles and noting that "if defendant makes the representation to a particular class of persons, he is
deemed to have deceived everyone in that class"]; [confirming principle but noting inapplicability where plaintiff unaware
of misrepresentation]; [citing and following ]; [applying principle to misleading advertising]; cf. [indirect reliance not
shown by evidence].)
[47] Here the jury was entitled to find that defendant's and its coconspirators' misrepresentations concerning the unsettled
state of relevant knowledge, and by implication the unreliability of evidence of a cigarette- cancer link, were made with the
intention and expectation that they would circulate among and influence the conduct of all smokers and prospective
smokers. They were passed to plaintiff, who knew that while the Surgeon General was saying one thing, the industry was
"saying different." This brings her within the cited rule.
Defendant attempts to characterize and then attack plaintiff's fraud theory as "fraud on the market," a concept developed
under federal securities law, which the court in refused to import into our common law of torts. "Fraud on the market" has
nothing to do with this case. Its essential principle is that an investor in a security, the price of which has been influenced
by fraud, may be deemed to have relied on the fraud. citing Neither that rule nor its context- specific rationale has any
bearing on fraud contended to have been practiced on a vast group of consumers, causing many of them to sustain personal
injuries. The facts of this case might be more accurately called "fraud on the public," but even that it is misleading.
Plaintiff herself was an intended target and victim of the fraud, through precisely the mechanisms of transmission intended
by defendant and its coconspirators. Defendant has failed to show any defect in the jury's verdict on the affirmative fraud
claims.
V.
BREACH OF EXPRESS WARRANTY
[48] Defendant contends that plaintiff offered "no evidence of an express warranty," such that the judgment in her favor "on
this claim" must be reversed. The gist of this argument is that plaintiff showed no express "affirmation of fact," as distinct
from an implication, opinion, or general commendation of goods, of which she was personally aware, or on the basis of which
she personally acted. Defendant also asserts that there was insufficient evidence to establish that any warranty the jury
might have found was actually the basis of any bargain between plaintiff and defendant.
Defendant has failed to meet its burden as a party challenging the sufficiency of the evidence. In a footnote, defendant
references plaintiff's simplest evidence of a direct, express warranty from defendant. Plaintiff testified that at some point
prior to the late 1980s she began to hear that "low-tar cigarettes were better" and that by smoking them "[y]ou wouldn't get
as much tar and nicotine." Accordingly she decided to " 'check into this,' " thinking, " 'Maybe I'll change from the Reds to the
Lights.' " She "did indeed call the Marlboro, Philip Morris company and expressed, you know, my concerns as to, 'Is it really
true? Is there less tar in this or less nicotine?' [¶ ] And I was assured at the time that if I was concerned that, yes, I could
switch to the Lights, which presented a real problem, because approximately a month or two after switching to Lights, I
went from two packs of cigarettes to three and a half packs of cigarettes a day."
Defendant fails to "show how and why [this evidence] is insufficient" to establish an express warranty. In a footnote it
mischaracterizes the testimony as confirming only "that if plaintiff wanted to smoke cigarettes with less tar and nicotine, she
could switch to light cigarettes." (Italics added.) We presume the jury did not adopt this interpretation. The least that the
testimony reasonably could be understood to mean was that defendant represented to plaintiff that she would take in less
tar and nicotine if she switched to Lights. This proved false (the warranty was breached) when (as defendant knew was
common) plaintiff simply increased the number of cigarettes she smoked.
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Further, even though plaintiff's trial testimony about this conversation was somewhat ambiguous, it supported an inference
that defendant's representative expressly assured plaintiff that Lights eliminated or reduced whatever risks smoking might
otherwise pose. That is, the assurance as stated at trial was that switching to Lights would address some unspecified
"concern[s]." The jury could infer that the "concerns" discussed were related to what plaintiff said motivated the call, i.e.,
that she had heard "low-tar cigarettes were better." By "better," the jury could infer, plaintiff meant "healthier."
[49] Even if defendant had carried its burden of showing that the record lacks substantial evidence of an express warranty,
no prejudice appears. We see no reasonable likelihood that the jury's consideration of this theory had any effect on its
findings on other matters, notably the fraud and strict liability claims.
VI.
FRAUDULENT CONCEALMENT
[50] Defendant contends that the jury verdict for plaintiff on the issue of fraudulent concealment cannot be sustained
because (1) plaintiff and the public were aware of the health risks of smoking at all relevant times; (2) "plaintiff did not
prove" that she relied on any mistaken beliefs that would have been dispelled by the posited disclosures; and (3) any
reliance would have been unreasonable as a matter of law.
[51] Again defendant fails to meet its burden as a party challenging the sufficiency of the evidence to support a particular
finding--in this case the jury's implied finding that neither plaintiff nor the public was aware of, or adequately appreciated,
the health risks of smoking. Defendant singles out two favorable passages of deposition testimony and uses them to assert
that plaintiff "was aware of the material fact that she claims was not disclosed to her--that smoking cigarettes can damage
one's health." In the first plaintiff answered affirmatively the question whether "throughout the time that you smoked, you
had heard that there were risks associated with smoking, or you had heard people say things about smoking and health; you
just didn't want to believe them." (Italics added.) In the second she acknowledged that there was a warning on every pack
she picked up after 1966. Neither of these passages constitutes a binding or compelling admission that when plaintiff began
smoking in 1961, or at any particular time thereafter, she knew of, understood, or appreciated the dangers of cigarette
smoking. In any event, citing favorable testimony is not enough; defendant must cite the evidence supporting a contrary
finding--the finding presumptively made by the jury--and show "how and why it is insufficient."
Plaintiff testified, among other things, that when she began smoking at age 15 she did not "understand there were dangers
about smoking cigarettes." Defendant disregards this particular question and answer, but goes on to assert that plaintiff's
trial testimony "is simply not credible." It then singles out testimony in response to the question, "When were you first
aware that cigarette smoking could cause lung cancer?" Plaintiff's actual response was, "I think my first complete
awareness that cigarette smoking could cause lung cancer was when a doctor came in and told me that I had lung cancer."
She testified that she was "baffled" by this information, which she "made them repeat to me several times." She continued:
"I just know that I must have seen the warnings, but to be fully aware or believe that this really did cause this, it didn't
register in my brain." She was inclined to believe, and preferred to believe, that her lung cancer was the result of asbestos
exposure, and she repeatedly questioned doctors about this alternative possibility. So complete was her "denial," as she
repeatedly described it, that even after her diagnosis she still sought ways to disbelieve it, in part to keep open the option of
taking up smoking again some day. Thus when a friend brought to her attention a report that cigarettes contained
ammonia--a substance to which plaintiff had a conditioned aversion based on a childhood trauma--plaintiff denounced the
report as " 'some kind of propaganda against the tobacco company.' "
We see nothing in this testimony that permits us to substitute our own judgments of credibility for those of the jury. Based
on this and other evidence, the jury was entitled to find that plaintiff, first because of her youth and inexperience and then
because of her addiction, did not believe the package warnings but thought all information about the health risks of smoking
was "propaganda" against the tobacco companies.
Nor will we debate the evidentiary minutiae over whether the public adequately appreciated the health risks of smoking to
excuse defendant from a duty to disclose. Instead we will presume in support of the judgment that the jury found on
substantial evidence that even if there was ample information in the public domain to convince reasonable observers of the
hazards of smoking, defendant and its fellows deliberately interfered with the assimilation of that information, particularly
by smokers and prospective smokers. It was this class to whom defendant presumably owed a primary duty of disclosure.
Nonsmokers were far less directly affected by the issue.
At least one of the cases cited by defendant on this subject--and the only California one--actually supports an argument in
favor of the judgment. In the court noted that tobacco had long had detractors but acknowledged that much of the
opposition seemed to rest on concerns of morality or aesthetics, not on any demonstrated health hazard. The court cited-and defendant apparently placed in evidence here--King James I's famous 1604 "Counterblaste to Tobacco," in which he
pronounced smoking "[a] custome loathsome to the eye, hatefull to the Nose, harmefull to the brain, dangerous to the Lungs,
and in the blacke, stinking fume thereof, neerest resembling the horrible Stigian smoke of the pit that is bottomlesse." By
the late nineteenth century, as the court observed, smoking had come to be associated with "general licentiousness" and
"cheesy dens of iniquity." ( This provided fertile ground for the tobacco companies' disinformation campaign, since it
predisposed addicted smokers (and adolescent presmokers chafing under adult authority) to attribute criticism of smoking to
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puritanical prejudice rather than sound scientific evidence. It hardly establishes widespread knowledge among smokers or
others that, as a matter of scientific and medical fact, smoking poses severe risks to health.
[52] Defendant likewise fails to carry its threshold burden on the subject of actual and reasonable reliance. Defendant
states, "plaintiff effectively admitted that any disclosures by PM regarding the health risks of smoking would have been
immaterial to her decision." But plaintiff plainly testified that she was unmoved by package warnings only because they
failed to indicate how dangerous cigarette smoking was, and because she knew they did not originate from the companies.
As plaintiff said, "[T]here's a lot of different degrees of danger. It's dangerous to walk across the street. When you're hooked
on something and you have the need to have that, you don't--you don't listen to that type of warnings. [¶ ] Maybe if the
tobacco company had come out and said: 'Our product is dangerous.' [¶ ] But I was listening and seeing things that the
Surgeon General was saying that the tobacco companies were saying different." (Italics added.)
Defendant has failed to carry its burden of showing that there was "no evidence," or insufficient evidence, to support each
finding necessary to the verdict on the fraudulent concealment theory.
VII.
NEGLIGENCE
We do not address defendant's attack on the jury's finding of simple negligence because the judgment is amply supported by
other theories of liability and nothing that occurred in connection with the negligence claim is reasonably likely to have
affected the outcome as to those claims.
VIII.
PUNITIVE DAMAGES
A. Sufficiency of Evidence.
Defendant contends that "There Is No 'Clear and Convincing' Evidence to Support the Predicate For Punitive Damages."
This is another challenge to the sufficiency of the evidence, and once again defendant has failed to carry its burden on
appeal.
The jury may award punitive damages "where it is proven by clear and convincing evidence that the defendant has been
guilty of oppression, fraud, or malice." (, subd. (a).) " 'Malice' means conduct which is intended by the defendant to cause
injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of
the rights or safety of others." (Id., subd. (c)(1).) " 'Oppression' means despicable conduct that subjects a person to cruel and
unjust hardship in conscious disregard of that person's rights." (Id., subd. (c)(2).) " 'Fraud' means an intentional
misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the
defendant of thereby depriving a person of property or legal rights or otherwise causing injury." (Id., subd. (c)(3).)
[53][54] We assume that the correct standard for review of a finding of oppression, fraud, or malice is as stated in i.e.,
whether evidence of sufficient substantiality was presented that a reasonable jury "could find [that] the plaintiff ha[d]
presented clear and convincing evidence on the disputed issue." (See ["all we are required to find is substantial evidence to
support a determination by clear and convincing evidence"]; cf. ["clear and convincing evidence" standard guides only trial
court and does not affect reviewing court, which continues to apply the substantial evidence standard];
Under this
standard, however, defendant still bears the burden of fairly summarizing the evidence favoring the challenged finding and
affirmatively demonstrating its insufficiency. (See Defendant's presentation fails to fairly characterize the most damaging
evidence or address its effect.
Defendant first seeks to categorically exclude two bodies of evidence from consideration in support of the punitive damage
award. First, it disingenuously asserts that conduct after July 1, 1969, cannot be considered in light of the federal
preemption "with limited exceptions" of claims based on conduct after that time. The primary "limited exception" is that the
1969 Act does not affect state law claims for fraud. Defendant also asserts that under / the jury should not have been
permitted to consider conduct immunized by former section 1714.45 in support of a punitive damages award. As we have
concluded in part I., above, defendant failed to preserve this argument for appeal. It is therefore unnecessary to decide
whether the punitive damage award is likely to have been affected by evidence of conduct during the "immunity window."
Defendant's silence with respect to such a theory prevented both the trial court and plaintiff from obviating the objection by
one or more steps such as prophylactically withholding or excluding evidence, instructing the jury as to the limited purposes
for which such evidence was admitted, or attempting to bring plaintiff's claims within the exceptions to the former immunity
noted in /
Defendant also attacks the trial court's opinion explaining its denial of defendant's motion to set aside the punitive damages
award. The court found the evidence "fully sufficient" to support express or implied jury findings that defendant willfully
and consciously marketed its cigarettes to teenagers, violated promises and representations to the public by concealing and
suppressing information known to it concerning the addictive and harmful properties of its product, and "affirmatively
misled the American public by advertising that there was genuine and legitimate controversy in the scientific community on
the subject of smoker health, when in fact there was no such controversy." In responding to these points defendant fails to
fairly summarize or address the evidence underlying the judgment.
[55] Defendant asserts that the finding of "targeting of teenagers" rested on the rationale that "Most people who become
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cigarette smokers begin smoking by age 19, so cigarette companies must target teenagers." This is not a fair
characterization of the record or of the trial court's opinion. Defendant attacks various documents cited by the trial court on
the ground that they were not shown to have been authored by a corporate officer, director, or managing agent. But even if
we accept this premise--which again, is not demonstrated but simply asserted as a fact--the primary relevance of these
materials was not to show conduct by their authors but as admissions of corporate conduct and circumstantial evidence of
the mental state of corporate officers, directors, and managers. As defendant concedes, the particular document it most
vigorously attacks was a draft presentation to defendant's Board of Directors. It was not deprived of all evidentiary force by
its "draft" status. A "draft" is defined and understood as " [a] preliminary sketch or rough form of a writing or document,
from which the final or fair copy is made." (4 Oxford English Dict. (2d ed.1989) p. 1008.) From the existence of a draft, the
existence of a "final fair copy" may be reasonably inferred. And where a draft document is relevant for its central theme
(rather than some incidental feature), it may be inferred that the theme survived into any final version.
The documents cited by the trial court amply showed knowledge by defendant that its Marlboro cigarettes were
particularly successful among children. Another document shows that this was no accident, but the deliberate
result of symbols consciously manipulating the adolescent mentality: "Marlboro's traditional area of strength has,
of course, been young people because the principal message its imagery delivers is independence. For young people
who are always being told what to do, the Marlboro man says, 'I'm in charge of my life. [¶ ].... [¶ ][T]he maturity of
the Marlboro man makes him representative of the ideal smoker--self confident and secure."
Defendant offers the notion that marketing its products to "teenagers" does not establish reprehensible conduct because 18
and 19-year olds are "teenagers" who may lawfully purchase and consume cigarettes. The argument is unsound. Moreover
none of the documents cited by the trial court limits itself to 18 and 19-year olds. They discuss smoking habits and "market
penetration" among children as young as 12 without the slightest acknowledgment of legal niceties such as defendant now
asserts. One document reviews the history of Marlboro's success and the business risks posed by a coming decline in the
number of teenagers, and includes the statement, "Because of our high share of the market among the youngest smokers,
Philip Morris will suffer more than the other companies...." (Italics added.)
Defendant asserts that its attempts to prevent the official classification of nicotine as a "drug" cannot support an award of
punitive damages. Defendant directs us to no indication that plaintiff, the trial court, or the jury placed any reliance on
such conduct. It is true that plaintiff played a videotaped excerpt from testimony before Congress in which a Philip Morris
executive apparently stated that he did not believe nicotine to be addictive. Elsewhere in its brief defendant contends that
this evidence was inadmissible. We do not decide the question because we do not think there is any significant possibility
that it affected the outcome.
[56] Defendant contends that its failure to disclose that cigarettes are addictive does not support a punitive award because
"it is, at bottom, a quibble over definitions." If so, it is a quibble of which the tobacco industry is the chief author and
beneficiary. The question is not whether the term "addictive" applies to cigarettes in some narrow medical sense but
whether a reasonable effort should have been made to bring home to defendant's mostly teenage "starters" market the
extreme difficulty they were likely to encounter in any future attempt to stop smoking. To borrow language used in 1965
congressional hearings, "For many people, the choice to smoke, once it has been made, may as a practical matter be
irrevocable." (Cigarette Labeling and Advertising Hearings before Sen. Com. on Commerce on Sen. Nos. 559 and 547, 89th
Cong., 1st Sess., at p. 500 (1965).)
We have examined defendant's remaining points concerning the evidence of oppression, fraud, or malice, and find them to be
insufficient to carry defendant's burden of showing that the finding on that subject was marred by error.
B. Size of Award--Federal Constitutional Constraints.
In our previous opinion we rejected defendant's intertwined arguments that the award was the product of passion and
prejudice and was excessive under state and federal law. We are now called upon to reconsider in light of whether the
award exceeded the federal constitutional limits articulated in that case. We have concluded that the present award cannot
be sustained consistent with but that an award of $9 million is permissible and appropriate on this record.
[57][58] "The Due Process Clause of the Fourteenth Amendment prohibits the imposition of grossly excessive or arbitrary
punishments on a tortfeasor."
see ) This constraint derives from the fundamental unfairness inherent in arbitrary
deprivations of life, liberty, or property, and in the imposition of punishment without fair notice. ["[e]lementary notions of
fairness enshrined in our constitutional jurisprudence dictate that a person receive fair notice not only of the conduct that
will subject him to punishment, but also of the severity of the penalty that a State may impose."].) Because civil punitive
damage awards present a significant risk of arbitrary punishment exceeding that of which the defendant had fair notice, the
Supreme Court has undertaken to "constitutionalize" the field by adopting a variety of substantive and procedural
safeguards against excessive awards. Among the procedural safeguards is the requirement, which we assume applies to the
present case, that appellate scrutiny of punitive awards be governed by a "de novo" standard of review. cf. )
[59] In determining the sustainability of a punitive award the constitutional "guideposts" to be considered are (1) the degree
of the defendant's culpability, i.e., the reprehensibility of his or her conduct, (2) the ratio between the punitive award and
the harm to the victim caused by the defendant's actions, and (3) the sanctions imposed in other cases for comparable
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misconduct.
see
[60] The "most important" of the three guideposts is the degree of reprehensibility of the defendant's conduct.
The record
reflects that defendant touted to children what it knew to be a cumulatively toxic substance, while doing everything it could
to prevent them and other addicts and prospective addicts from appreciating the true nature and effects of that product.
The result of this conduct was that millions of youngsters, including plaintiff, were persuaded to participate in a habit that
was likely to, and did, bring many of them to early illness and death. Such conduct supports a substantial award sufficient
to reflect the moral opprobrium in which defendant's conduct can and should be held, and warrants something approaching
the maximum punishment consistent with constitutional principles.
The Supreme Court has identified several subsidiary factors which pertain to the degree of reprehensibility of a defendant's
conduct: (1) whether the defendant inflicted bodily as opposed to merely economic injury; (2) whether its tortious conduct
"evinced an indifference to or a reckless disregard of the health or safety of others"; (3) whether "the target of the conduct
had financial vulnerability"; (4) whether the conduct "involved repeated actions or was an isolated incident"; and (5)
whether the harm was "the result of intentional malice, trickery, or deceit, or mere accident."
Each of these factors
supports finding a high degree of reprehensibility here. The gist of plaintiff's claim was not that defendant inflicted an
economic harm but that its conduct caused her severe bodily injury in the form of lung cancer. Defendant's malicious
infliction of such an injury is, in that respect, substantially more reprehensible than the conduct at issue in (bad faith
denial of insurance claim), (intentional concealment of repair history in sale of "new" automobile), or (unfair competition,
including false advertising, in sale of competing product). Further, defendant's conduct arguably betrayed an attitude
characterized not by mere indifference or recklessness, but by a conscious acceptance of the injurious results.
Moreover defendant consciously exploited the known vulnerabilities of children, who by its own words comprised its
"traditional area of strength." (See fn. 19, above.) The court in and stated the third reprehensibility subfactor in terms of
financial vulnerability, but that characterization undoubtedly reflects the origins of those opinions in torts of an essentially
economic nature. In other cases, such as this one, it makes sense to ask whether and to what extent the defendant took
advantage of a known vulnerability on the part of the victim to the conduct triggering the award of punitive damages, or to
the resulting harm.
Obviously defendant's conduct was also particularly reprehensible on the fourth and fifth axes, i.e., it "involved
repeated actions" rather than "an isolated incident," and it inflicted harm by "intentional malice, trickery, or
deceit," rather than "mere accident." These factors are present even when we focus on the conduct contributing to
plaintiff's own injuries.
It thus appears that all five of the subfactors in point to a high degree of reprehensibility. However defendant emphasizes
the court's criticism of the award there under review for resting in major part on conduct which did not resemble, and had
no concrete connection with, the conduct which injured the plaintiffs. Justice Kennedy criticized the punitive claim there for
not relying on the insurer's wrongful "conduct toward the Campbells," but for instead having been "used as a platform to
expose, and punish, the perceived deficiencies of State Farm's operations throughout the country." italics added.) The court
went on to identify three categories of conduct which should have been considered with caution, if at all. It first noted that a
state "cannot punish a defendant for conduct that may have been lawful where it occurred." see [jury should be instructed
"that it may not use evidence of out-of-state conduct to punish a defendant for action that was lawful in the jurisdiction
where it occurred"].) Such conduct "may be probative when it demonstrates the deliberateness and culpability of the
defendant's action in the State where it is tortious, but that conduct must have a nexus to the specific harm suffered by the
plaintiff." Second, a similar constraint will often apply to unlawful out-of-state conduct, given that a state ordinarily has no
legitimate interest in "imposing punitive damages to punish a defendant for unlawful acts committed outside of the State's
jurisdiction."
And finally, punitive damages cannot permissibly rest on "dissimilar acts" that "b [ear] no relation to the
[plaintiff's] harm."
Defendant contends that these limitations render the award here unconstitutional because the jury heard substantial
evidence of wrongful conduct outside California, conduct that may have been lawful where (and when) it occurred, and
conduct having no causal connection to the harm suffered by plaintiff. Unlike the defendant in however, defendant made
no attempt to anticipate the Supreme Court's direction by objecting to the evidence or seeking a limiting instruction. (See
Defendant also substantially overstates this aspect of by suggesting that it rendered such evidence categorically
inadmissible. On the contrary, the court acknowledged that such evidence may be considered if a sufficient "nexus" is shown
to the plaintiff's claim. see italics added [state "does not have the power ... to punish [a defendant] for conduct that was
lawful where it occurred and that had no impact on [the forum state] or its residents "].)
In any event we believe that any error in the consideration of this evidence is sufficiently redressed by the conditional
modification we direct here, which reduces the punitive award to a level below which we believe no properly instructed jury
was reasonably likely to go. The effect of the evidence affected by these concerns is not nearly as dramatic here as it was in
There the plaintiffs' own cause of action rested on a delay in allowing a single insurance claim, and associated conduct; yet
the claim for punitive damages rested on a wholesale attack on many aspects of the defendant's nationwide business
practices, including even its assertedly malicious treatment of its employees.
Plaintiff's claims, in contrast, rest on a
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265
quintessential "mass tort," i.e., a course of more-or-less uniform conduct directed at the entire public and maliciously
injuring, through a system of interconnected devices, an entire category of persons to which plaintiff squarely belongs.
This brings us to a consideration of the court's discussion of the second factor, which is the relationship between the actual
damages suffered by the plaintiff and the punitive damage award. It is on this point that we believe the present award of
$25 million cannot be sustained. Although the court reiterated its earlier refusals to "impose a bright-line ratio which a
punitive damages award cannot exceed" citing it went on to suggest several concrete numerical guidelines for considering
whether a particular award violates constitutional restraints. Specifically, it stated that (1) "few awards exceeding a singledigit ratio between punitive and compensatory damages, to a significant degree, will satisfy due process"; (2) a "4-to-1 ratio"
may typically be "close to the line of constitutional impropriety"; (3) higher ratios may be appropriate where " 'a particularly
egregious act has resulted in only a small amount of economic damages,' " where " 'the injury is hard to detect,' " or where "
'the monetary value of noneconomic harm might have been difficult to determine' "; (4) lower ratios--perhaps as low as 1 to
1--may "reach the outermost limit of the due process guarantee" where "compensatory damages are substantial"; but (5) the
"precise award in any case ... must be based upon the facts and circumstances of the defendant's conduct and the harm to
the plaintiff." ( quoting
The court found the award there, which was 145 times the compensatory damages awarded, constitutionally infirm for a
number of reasons: (1) the plaintiffs had been fully compensated by a substantial award of compensatory damages; (2) the
harm arose from an economic transaction, "not from some physical assault or trauma," and resulted in no physical injuries;
(3) the actual economic damages suffered were "minor" because the defendant insurer had ultimately paid the judgment its
conduct caused the plaintiffs to suffer; and (4) the compensatory damages thus probably already included an award for
"outrage and humiliation," which was then duplicated in the punitive award. The court rejected the Utah Supreme Court's
conclusion that the award was justified by other factors, notably the wealth of the defendant and the likelihood, according to
expert testimony, that other misconduct by the defendant would go unpunished. The court rejected the Utah Supreme
Court's justification of the award on grounds that, under the third "guidepost," it was proportionate to other sanctions
which might have been imposed. The court concluded that the award there "was neither reasonable nor proportionate to
the wrong committed, and it was an irrational and arbitrary deprivation of the property of the defendant." It remanded the
matter to the Utah courts for a "proper calculation of punitive damages under the principles we have discussed."
The court noted that the existence of criminal penalties was of doubtful significance, particularly where the
likelihood of a criminal sanction was remote.
The "most relevant civil sanction" under Utah law was a fine of
$10,000, "an amount dwarfed by the $145 million punitive damages award." The court rejected "speculat[ion]"
about sanctions such as license revocation and disgorgement of profits, noting that "here again [the Utah court's]
references were to the broad fraudulent scheme drawn from evidence of out-of-state and dissimilar conduct."
We place limited reliance on the proportionality factor here, but note that defendant's earlier arguments on this
point seemed to backfire. Defendant suggested analogizing its conduct to furnishing tobacco to a minor under
California law ( [civil penalty from $200 for first offense to $6,000 for fifth offense]; [penal fine of $200 for first
offense up to $1,000 for third offense] ) or to violations of the 1969 Act ( [$10,000 per violation] ). By our
calculations, and in light of the repetitive nature of defendant's conduct, these statutes could support fines in the
range of $6.6 million to $11 million, respectively. Assuming plaintiff smoked for three years before reaching the age
of 18, and assuming defendant (by its own analogy) furnished cigarettes to her every day of that time, its conduct
would seemingly constitute nearly 1,100 violations of the two California statutes cited, and would arguably
constitute as many violations of the federal statutes. Assessing the maximum civil penalties of $6,000 and $10,000,
respectively, would yield a total state penalty of some $6.6 million and a federal penalty of some $11 million.
[61][62] In light of we do not believe the 17-to-1 ratio reflected in the present judgment can withstand scrutiny. As we read
that case, a double-digit ratio will be justified rarely, and perhaps never in a case where the plaintiff has recovered an ample
award of compensatory damages. Indeed, where a plaintiff has been fully compensated with a substantial compensatory
award, any ratio over 4 to 1 is "close to the line." Nonetheless we believe a higher ratio (6 to 1) is justified here by the
extraordinarily reprehensible conduct of which plaintiff was a direct victim. There is no reason to believe that the
compensatory damages were inflated so as to duplicate elements of the punitive award. Moreover, as we have noted,
plaintiff's injuries were not merely economic, but physical, and nothing done by defendant mitigated or ameliorated them in
any respect.
C. Size of Award--State Law Constraints.
[63][64][65] Under California law, a punitive damage award may be reversed as excessive "only if the entire record, viewed
most favorably to the judgment, indicates the award was the result of passion and prejudice." "The purpose of punitive
damages is a public one-- to punish wrongdoing and deter future misconduct by either the defendant or other potential
wrongdoers. The essential question for the jury, the trial court, and the appellate courts is whether the amount of the
award substantially serves the public interest in punishment and deterrence. The California Supreme Court has
established three criteria for making that determination: (1) the reprehensibility of the defendant's misdeeds; (2) the
amount of compensatory damages, though there is no fixed ratio for determining whether punitive damages are reasonable
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in relation to actual damages; and (3) the defendant's financial condition. [Citations.] The wealthier the wrongdoer, the
larger the punitive damage award must be to meet the goals of punishment and deterrence. [Citations.]"
Defendant correctly notes that the constitutional soundness of the third consideration has been rendered uncertain by
seemingly categorical rejection of the Utah Supreme Court's reliance on the defendant's " 'massive wealth' " as one
justification for the award there. quoting The court declared that "[t]he wealth of a defendant cannot justify an otherwise
unconstitutional punitive damages award." ( We need not determine the precise effect of this declaration on California law,
however, because in view of our downward reduction of the verdict we do not believe an instruction on this point would have
produced a judgment more favorable to defendant.
[66] Defendant also contends that the award is excessive in light of the potential for other actions like this one in which
punitive damages may also be awarded, magnifying the deterrent effect. California courts have previously acknowledged
the potential multiplicity of awards as a factor that may be weighed, and on proper presentation presumably should or must
be weighed, in fixing a punitive damage award. (See disapproved on other grounds in
, com. e; .) The implementation
of will presumably diminish the significance of this factor, however, because it will constrain courts and juries to tailor
punitive awards more closely to the harm done to individual plaintiffs, substantially reducing the risk that multiple punitive
awards will rest on the same facts and conduct so as to constitute multiple punishment.
Again, however, we need not closely consider the issue because we have already weighed the risk of duplicative punishment
in further reducing the award. The trial court did likewise, expressly citing the possibility of future awards as one reason to
reduce the jury's award from $50 million to $25 million. The court predicted that numerous suits would be filed against
defendant, that the costs of defense and any resulting judgments would be substantial, that punitive damages "undoubtedly
will be requested and may well be awarded in many such suits," and that this reinforced the court's conclusion "that $25
million is enough to punish and deter in the present context." Defendant has argued that that the award should have been
reduced even further, and with our remittitur today it has. We also reiterate our earlier observation that the risk of multiple
punitive awards against defendant remains highly speculative. The extent to which other plaintiffs may succeed remains to
be seen, particularly in light of and
Insofar as the award is challenged under California law, we cannot say that, as reduced by the trial court and further
reduced by this court, it is the product of passion and prejudice.
DISPOSITION
The judgment is affirmed in all respects except as to the amount of punitive damages. With respect to that issue, the
judgment is modified to reduce the award to $9 million dollars provided plaintiff files a timely consent to such reduction in
accordance with . If plaintiff does not file such consent, the judgment is reversed with respect to the amount of punitive
damages only and remanded for a new trial on that issue.
The parties shall bear their own costs on appeal.
Case 13.2
198 N.E.2d 309
Priscilla D. WEBSTER
v.
BLUE SHIP TEA ROOM, INC.
Supreme Judicial Court of Massachusetts, Suffolk.
Argued April 6, 1964.
Decided May 4, 1964.
REARDON, Justice.
This is a case which by its nature evokes earnest study not only of the law but also of the culinary traditions of the
Commonwealth which bear so heavily upon its outcome. It is an action to recover damages for personal injuries sustained by
reason of a breach of implied warranty of food served by the defendant in its restaurant. An auditor, whose findings of fact
were not to be final, found for the plaintiff. On a retrial in the Superior Court before a judge and jury, in which the plaintiff
testified, the jury returned a verdict for her. The defendant is here on exceptions to the refusal of the judge (1) to strike
certain portions of the auditor's report, (2) to direct a verdict for the defendant, and (3) to allow the defendant's motion for
CHAPTER 13: WARRANTIES, PRODUCT LIABILITY, AND CONSUMER LAW
267
the entry of a verdict in its favor under leave reserved. The jury could have found the following facts: On Saturday, April 25,
1959, about 1 P. M., the plaintiff, accompanied by her sister and her aunt, entered the Blue Ship Tea Room operated by the
defendant. The group was seated at a table and supplied with menus. This restaurant, which the plaintiff characterized as
"quaint,' was located in Boston "on the third floor of an old building on T Wharf which overlooks the ocean.' The plaintiff,
who had been born and brought up in New England (a fact of some consequence), ordered clam chowder and crabmeat salad.
Within a few minutes she received tidings to the effect that "there was no more clam chowder,' whereupon she ordered a cup
of fish chowder. Presently, there was set before her "a small bowl of fish chowder.' She had previously enjoyed a breakfast
about 9 A. M. which had given her no difficulty. "The fish chowder contained haddock, potatoes, milk, water and seasoning.
The chowder was milky in color and not clear. The haddock and potatoes were in chunks' (also a fact of consequence). "She
agitated it a little with the spoon and observed that it was a fairly full bowl * * *. It was hot when she got it, but she did not
tip it with her spoon because it was hot * * * but stirred it in an up and under motion. She denied that she did this because
she was looking for something, but it was rather because she wanted an even distribution of fish and potatoes.' "She started
to eat it, alternating between the chowder and crackers which were on the table with * * * (some) rolls. She ate about 3 or 4
spoonfuls then stopped. She looked at the spoonfuls as she was eating. She saw equal parts of liquid, potato and fish as she
spooned it into her mouth. She did not see anything unusual about it. After 3 or 4 spoonfuls she was aware that something
had lodged in her throat because she couldn't swallow and couldn't clear her throat by gulping and she could feel it.' This
misadventure led to two esophagoscopies at the Massachusetts General Hospital, in the second of which, on April 27, 1959,
a fish bone was found and removed. The sequence of events produced injury to the plaintiff which was not insubstantial. We
must decide whether a fish bone lurking in a fish chowder, about the ingredients of which there is no other complaint,
constitutes a breach of implied warranty under applicable provisions of the Uniform Commercial Code,1 the annotations to
which are not helpful on this point. As the judge put it in his charge, "Was the fish chowder fit to be eaten and wholesome? *
* * (N)obody is claiming that the fish itself wasn't wholesome. * * * But the bone of contention here-I don't mean that for a
pun-but was this fish bone a foreign substance that made the fish chowder unwholesome or not fit to be eaten?'
1. "(1) Unless excluded or modified by section 2-316, a warranty that the goods shall be merchantable is implied in a
contract for their sale if the seller is a merchant with respect to goods of that kind. Under this section the serving for value
of food or drink to be consumed either on the premises or elsewhere is a sale. (2) Goods to be merchantable must at least be
such as * * * (c) are fit for the ordinary purposes for which such goods are used * * *.' G.L. c. 106, section 2-314.
"* * * (3)(b) (W)hen the buyer before entering into the contract has examined the goods or the sample or model as fully as he
desired or has refused to examine the goods there is no implied warranty with regard to defects which an examination ought
in the circumstances to have revealed to him * * *.' G.L. c. 106, section 2-316.
The plaintiff has vigorously reminded us of the high standards imposed by this court where the sale of food is involved (see
Flynn v. First Natl. Stores Inc., 296 Mass. 521, 523, 6 N.E.2d 814) and has made reference to cases involving stones in beans
(Friend v. Childs Dining Hall Co., 231 Mass. 65, 120 N.E. 407, 5 A.L.R. 1100), trichinae in pork (Holt v. Mann, 294 Mass. 21,
22, 200 N.E. 403), and to certain other cases, here and elsewhere, serving to bolster her contention of breach of warranty.
The defendant asserts that here was a native New Englander eating fish chowder in a "quaint' Boston dining place where
she had been before; that "(f)ish chowder, as it is served and enjoyed by New Englanders, is a hearty dish, originally
designed to satisfy the appetites of our seamen and fishermen'; that "(t)his court knows well that we are not talking of some
insipid broth as is customarily served to convalescents.' We are asked to rule in such fashion that no chef is forced "to reduce
the pieces of fish in the chowder to miniscule size in an effort to ascertain if they contained any pieces of bone.' "In so ruling,'
we are told (in the defendant's brief), "the court will not only uphold its reputation for legal knowledge and acumen, but will,
as loyal sons of Massachusetts, save our world-renowned fish chowder from degenerating into an insipid broth containing
the mere essence of its former stature as a culinary masterpiece.' Notwithstanding these passionate entreaties we are bound
to examine with detachment the nature of fish chowder and what might happen to it under varying interpretations of the
Uniform Commercial Code. Chowder is an ancient dish preÄexisting even "the appetites of our seamen and fishermen.' It
was perhaps the common ancestor of the "more refined cream soups, purÅees, and bisques.' Berolzheimer, The American
Woman's Cook Book (Publisher's Guild Inc., New York, 1941) p. 176. The word "chowder' comes from the French
"chaudiÇere,' meaning a "cauldron' or "pot.' "In the fishing villages of Brittany * * * "faire la chaudiÇere' means to supply a
cauldron in which is cooked a mess of fish and biscuit with some savoury condiments, a hodge-podge contributed by the
fishermen themselves, each of whom in return receives his share of the prepared dish. The Breton fishermen probably
carried the custom to Newfoundland, long famous for its chowder, whence it has spread to Nova Scotia, New Brunswick, and
New England.' A New English Dictionary (MacMillan and Co., 1893) p. 386. Our literature over the years abounds in
references not only to the delights of chowder but also to its manufacture. A namesake of the plaintiff, Daniel Webster, had
a recipe for fish chowder which has survived into a number of modern cookbooks2 and in which the removal of fish bones is
not mentioned at all. One old time recipe recited in the New English Dictionary study defines chowder as "A dish made of
fresh fish (esp. cod) or clams, stewed with slices of pork or bacon, onions, and biscuit. "Cider and champagne are sometimes
added.'' Hawthorne, in The House of the Seven Gables (Allyn and Bacon, Boston, 1957) p. 8, speaks of "(a) codfish of sixty
pounds, caught in the bay, (which) had been dissolved into the rich liquid of a chowder.' A chowder variant, cod "Muddle,'
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was made in Plymouth in the 1890s by taking "a three or four pound codfish, head added. Season with salt and pepper and
boil in just enough water to keep from burning. When cooked, add milk and piece of butter.'3 The recitation of these ancient
formulae suffices to indicate that in the construction of chowders in these parts in other years, worries about fish bones
played no role whatsoever. This broad outlook on chowders has persisted in more modern cookbooks. "The chowder of today
is much the same as the old chowder * * *.' The American Woman's Cook Book, supra, p. 176. The all embracing Fannie
Farmer states in a portion of her recipe, fish chowder is made with a "fish skinned, but head and tail left on. Cut off head
and tail and remove fish from backbone. Cut fish in 2-inch pieces and set aside. Put head, tail, and backbone broken in
pieces, in stewpan; add 2 cups cold water and bring slowly to boiling point * * *.' The liquor thus produced from the bones is
added to the balance of the chowder. Farmer, The Boston Cooking School Cook Book (Little Brown Co., 1937) p. 166.
2. "Take a cod of ten pounds, well cleaned, leaving on the skin. Cut into pieces one and a half pounds thick, preserving the
head whole. Take one and a half pounds of clear, fat salt pork, cut in thin slices. Do the same with twelve potatoes. Take the
largest pot you have. Fry out the pork first, then take out the pieces of pork, leaving in the drippings. Add to that three parts
of water, a layer of fish, so as to cover the bottom of the pot; next a layer of potatoes, then two tablespoons of salt, 1 teaspoon
of pepper, then the pork, another layer of fish, and the remainder of the potatoes. Fill the pot with water to cover the
ingredients. Put over a good fire. Let the chowder boil twenty-five minutes. When this is done have a quart of boiling milk
ready, and ten hard crackers split and dipped in cold water. Add milk and crackers. Let the whole boil five minutes. The
chowder is then ready to be first-rate if you have followed the directions. An onion may be added if you like the flavor.' "This
chowder,' he adds, "is suitable for a large fishing party.' Wolcott, The Yankee Cook Book (Coward-McCann, Inc., New York
City, 1939) p. 9.
3. Atwood, Receipts for Cooking Fish (Avery & Doten, Plymouth, 1896) p. 8.
Thus, we consider a dish which for many long years, if well made, has been made generally as outlined above. It is not too
much to say that a person sitting down in New England to consume a good New England fish chowder embarks on a
gustatory adventure which may entail the removal of some fish bones from his bowl as he proceeds. We are not inclined to
tamper with age old recipes by any amendment reflecting the plaintiff's view of the effect of the Uniform Commercial Code
upon them. We are aware of the heavy body of case law involving foreign substances in food, but we sense a strong
distinction between them and those relative to unwholesomeness of the food itself, e. g., tainted mackerel (Smith v. Gerrish,
256 Mass. 183, 152 N.E. 318), and a fish bone in a fish chowder. Certain Massachusetts cooks might cavil at the ingredients
contained in the chowder in this case in that it lacked the heartening lift of salt pork. In any event, we consider that the joys
of life in New England include the ready availability of fresh fish chowder. We should be prepared to cope with the hazards
of fish bones, the occasional presence of which in chowders is, it seems to us, to be anticipated, and which, in the light of a
hallowed tradition, do not impair their fitness or merchantability. While we are bouyed up in this conclusion by Shapiro v.
Hotel Statler Corp., 132 F.Supp. 891 (S.D.Cal.), in which the bone which afflicted the plaintiff appeared in "Hot Barquette of
Seafood Mornay,' we know that the United States District Court of Southern California, situated as are we upon a coast,
might be expected to share our views. We are most impressed, however, by Allen v. Grafton, 170 Ohio St. 249, 164 N.E.2d
167, where in Ohio, the Midwest, in a case where the plaintiff was injured by a piece of oyster shell in an order of fried
oysters, Mr. Justice Taft (now Chief Justice) in a majority opinion held that "the possible presence of a piece of oyster shell
in or attached to an oyster is so well known to anyone who eats oysters that we can say as a matter of law that one who eats
oysters can reasonably anticipate and guard against eating such a piece of shell * * *.' (P. 259 of 170 Ohio St., p. 174 of 164
N.E.2d.)
Thus, while we sympathize with the plaintiff who has suffered a peculiarly New England injury, the order must be
Exceptions sustained.
Judgment for the defendant.
Case 13.3
237 F.Supp.2d 512
United States District Court,
S.D. New York.
CHAPTER 13: WARRANTIES, PRODUCT LIABILITY, AND CONSUMER LAW
269
Ashley PELMAN, a child under the age of 18 years, by her Mother and Natural
Guardian Roberta Pelman, Roberta Pelman, Individually, Jazlyn Bradley, a child
under the age of 18 years, by her Father and Natural Guardian Israel Bradley, and
Israel Bradley, Individually, Plaintiffs,
v.
McDONALD'S CORPORATION, McDonald's Restaurants of New York, Inc.,
McDonald's 1865 Bruckern Boulevard, Bronx, New York, McDonald's 2630 Jerome
Avenue, Bronx, New York, Defendants.
No. 02 CIV. 7821(RWS).
Jan. 22, 2003.
, District Judge.
TABLE OF CONTENTS
Prior Proceedings ......................................................... 519
Facts ..................................................................... 519
Parties ................................................................... 519
Obesity in Young Persons and Its Effects .................................. 519
Claims .................................................................... 520
Discussion ................................................................ 521
I. Diversity Jurisdiction Exists, and the Plaintiffs' Motion To
Remand Is Denied ........................................... 521
A. The Outlets .............................................. 521
B. McDonalds of New York .................................... 522
C. The Outlets and McDonalds of New York Are Akin To
Retailers And Distributors of McDonalds Corp.'s
Products ............................................... 523
II. McDonalds' Motion to Dismiss ................................. 524
A. Standard of Review ....................................... 524
B. Counts I and II: Plaintiffs Fail to State a Claim
Pursuant to N.Y. Gen. Bus. Law § § 349 and 350 .......... 524
1. Federal Pre-Emption .................................. 525
2. Requirements of § § 349 And 350 ....................... 526
a. Count I .......................................... 527
i. Deceptive Acts ............................. 527
ii. Deceptive Omissions ........................ 529
b. Count II ......................................... 530
III. Counts III, IV and V: Negligence Claims ...................... 530
A. Count III: Inherently Dangerous Food ..................... 531
1. Whether McDonalds Had a Duty to Plaintiffs Because
the Dangers Were Not Within Common Knowledge ....... 531
a. Allegations Within the Complaint ................. 531
b. Allegations Outside the Complaint ................ 533
i. Plaintiffs' Claim that McDonalds' Products
are More Dangerous than the Average
Hamburger, Fries and Shake ............... 534
ii. Allergic Sensitivity ....................... 536
iii. Foreseeable Misuse ......................... 536
iv. The NLEA ................................... 537
2. Proximate Cause ...................................... 537
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B. Count IV: Failure to Warn of Unhealthy Attributes ........ 540
IV. Count V: Sale of Addictive Products .......................... 542
V. Leave to Amend is Granted .................................... 543
Conclusion ................................................................ 543
Defendants McDonald's Corporation ("McDonalds Corp."); McDonald's Restaurants of New York, Inc. ("McDonalds of New
York"); McDonald's 1865 Bruckner Boulevard Bronx, New York ("Bruckner Boulevard outlet"); and McDonald's 2630
Jerome Avenue, Bronx, New York ("Jerome Avenue outlet") (collectively "McDonalds") have moved pursuant to to dismiss
the complaint of class-action plaintiffs Ashley Pelman, Roberta Pelman, Jazlen Bradley, and Israel Bradley. The plaintiffs
have cross-moved to remand the case to state court.
This action presents unique and challenging issues. The plaintiffs have alleged that the practices of McDonalds in making
and selling their products are deceptive and that this deception has caused the minors who have consumed McDonalds'
products to injure their health by becoming obese. Questions of personal responsibility, common knowledge and public
health are presented, and the role of society and the courts in addressing such issues.
The issue of determining the breadth of personal responsibility underlies much of the law: where should the line be drawn
between an individual's own responsibility to take care of herself, and society's responsibility to ensure that others shield
her? Laws are created in those situations where individuals are somehow unable to protect themselves and where society
needs to provide a buffer between the individual and some other entity--whether herself, another individual or a behemoth
corporation that spans the globe.
Thus Congress provided that essentially all packaged foods sold at retail shall be
appropriately labeled and their contents described. The Nutrition Labeling and Education Act of , 104 Stat. 2353 (Nov. 8,
1990) (the "NLEA"), . Also as a matter of federal regulation, all alcoholic beverages must warn pregnant women against
their use. (forbidding sale of alcohol unless it bears the following statement: "GOVERNMENT WARNING: (1) According
to the Surgeon General, women should not drink alcoholic beverages during pregnancy because of the risk of birth defects
...."); . Congress has gone further and made the possession and consumption of certain products criminal because of their
presumed effect on the health of consumers. Other products have created health hazards and resulted in extensive and
expensive class action litigation. E.g., (affirming denial of certification of class of potentially millions who had suffered
injuries as a result of exposure to asbestos); (class action of six million who took diet drugs (Pondimin and Redux) that
were later linked to valvular heart disease); (discussing possibility of transfer of thousands of cases alleging injuries from
silicone breast implants). Public health is one, if not the, critical issue in society.
The NLEA sought "to ensure that consumers have access to information about food that is scientifically valid,
truthful, reliable, understandable and not misleading. This information will enable consumers to make more
healthful food choices." Marilyn J. Schramm, (citation omitted); Mara A. Michaels, ("Congress believed that if
consumers were informed about the possible health benefits of foods, they would be better equipped to make
appropriate food choices."). To promote these goals, requires, inter alia, that non-exempted retail food be labeled
with the following information: (1) the serving size; (2) the number of servings per container; (3) the total number
of calories derived from any source and derived from fat; (4) the amount of total fat, saturated fat, cholesterol,
sodium, total carbohydrates, complex carbohydrates, sugars, dietary fiber, and total protein per serving. .
In the interest of consistency and integrity, it should be noted that the author of this opinion publicly opposed the
criminalization of drugs. See Stephen Labaton, "Federal Judge Urges Legalization of Crack, Heroin and Other
Drugs," N.Y. Times at A1 (Dec. 13, 1989) ("Judge Sweet became the first Federal judge to propose publicly that
illegal drugs be made legal ...."). This belief is based upon the notion that, as long as consumers have adequate
knowledge about even harmful substances, they should be entitled to purchase them, and that the issue should be
one of health, rather than of the criminal law.
E.g., Robert W. Sweet & Edward A. Harris, Moral and
Constitutional Considerations in Support of the Decriminalization of Drugs, in How To Legalize Drugs 430, 433
(Jefferson M. Fish, ed. 1998) ("Ultimately, we favor a drug policy that would be comparable to the nation's current
policy and legal framework regulating alcohol, and we suggest that support for such a policy--based on a right to
self-determination--may be derived from the Ninth Amendment of the Constitution."). The same logic must apply
in the situation of fast food, which is arguably less harmful and certainly less demonized than drugs that have been
made illegal--unless, of course, this case is the opening salvo in the "War on Big Macs."
This opinion is guided by the principle that legal consequences should not attach to the consumption of hamburgers and
other fast food fare unless consumers are unaware of the dangers of eating such food. As discussed, infra, this guiding
principle comports with the law of products liability under New York law. As Sir Francis Bacon noted, "Nam et ipsa scientia
potestas est," or knowledge is power.
Following from this aphorism, one important principle in assigning legal
responsibility is the common knowledge of consumers. If consumers know (or reasonably should know) the potential ill
health effects of eating at McDonalds, they cannot blame McDonalds if they, nonetheless, choose to satiate their appetite
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with a surfeit of supersized McDonalds products. On the other hand, consumers cannot be expected to protect against a
danger that was solely within McDonalds' knowledge. Thus, one necessary element of any potentially viable claim must be
that McDonalds' products involve a danger that is not within the common knowledge of consumers. As discussed later,
plaintiffs have failed to allege with any specificity that such a danger exists.
The phrase, which appeared in De Haeresibus (1597), is literally translated as "for knowledge itself is power."
McDonalds has also, rightfully, pointed out that this case, the first of its kind to progress far enough along to reach the stage
of a dispositive motion, could spawn thousands of similar "McLawsuits" against restaurants. Even if limited to that ilk of
fare dubbed "fast food," the potential for lawsuits is great : Americans now spend more than $110 billion on fast food each
year, and on any given day in the United States, almost one in four adults visits a fast food restaurant. Eric Schlosser, Fast
Food Nation 3 (2002) (hereinafter "Schlosser"). The potential for lawsuits is even greater given the numbers of persons who
eat food prepared at other restaurants in addition to those serving fast food. See FDA, ("Almost half of the American food
dollar is spent on food consumed away from home, and ... perhaps as much as 30 percent of the American diet is composed of
foods prepared in food service operations."). In light of these facts, the Court is cognizant of its duty "to limit the legal
consequences of wrongs to a controllable degree and to protect against crushing exposure to liability." (quoting ).
Indeed, The Economist in its Dec. 21, 2002 issue provided an Orwellian view from the year 2012 of what the
potential success of fast- food lawsuits would do to the American landscape and culture. "Battling against big food,"
The Economist 108 (Dec. 21, 2002).
The interplay of these issues and forces has created public interest in this action, ranging from reports and letters to the
Court to television satire. Obesity, personal liberty and public accountability affect virtually every American consumer.
Much of the reaction has been negative.
Debra Goldman, "Consumer Republic: common sense may not be
McDonald's ally for long," ADWEEKE. Ed. 14 (12/02/02), ("In dozens of on-the- street interviews and Web polls
conducted since the suit made news last month, the masses have expressed their incredulity at and contempt for
the litigious kids--and parents--who won't take responsibility for a lifetime of chowing down Happy Meals. With
much tongue-clucking, the vox populi bemoans yet another symptom of the decline of personal responsibility and
the rise of the cult of victimhood."). See also Sarah Avery, "Is Big Fat the Next Big Tobacco?" Raleigh News &
Observer, at A25, ("[A related] lawsuit has brought howls of dissent and derision--as yet another example of a
litigious society run amok. How, indeed, could food be considered as addicting and harmful as smoking?"); Neil
Buckley, "Big Food faces grilling over America's obesity 'epidemic,' " Fin. Times at P20 (11/27/02) (quoting founder
of Center for Consumer Freedom, which gets funding from restaurants and food companies, as stating "The reality
is that anyone with an IQ higher than room temperature will understand that excessive consumption of food served
in fast-food restaurants will lead to weight gain."); "How did the lawyer keep from laughing?," S. Bend Trib. (Ind.)
(08/13/02) ("[T]he fast-food lawsuit is generally regarded as a joke ....");
Amity Shlaes, "Lawyers get fat on
McDonald's," Chicago Tribune, at 25 (11/27/02) ("Every now and then America draws a cartoon of herself for the
amusement of the rest of the world. Last week's fat lawsuit against McDonald's is one of those occasions.").
In terms of the pending motion by McDonalds to dismiss the complaint, these principles require the complaint to be
dismissed for lack of specificity, with leave granted to replead within the limits set forth below.
Prior Proceedings
The plaintiffs commenced suit on August 22, 2002, in the State Supreme Court of New York, Bronx County. Defendants
removed the action to the Southern District of New York on September 30, 2002, alleging as the basis of removal that the
plaintiffs had fraudulently joined non-diverse parties in order to defeat diversity jurisdiction pursuant to .
McDonalds filed the instant motion to dismiss plaintiffs' complaint (the "Complaint") on October 7, 2002. The plaintiffs
cross-moved to remand and in opposition to the motion on October 25, 2002. Oral argument on both motions was held on
November 20, 2002, and the motions were considered fully submitted at that time.
Facts
As befits a motion to dismiss, the following facts are drawn from the allegations in the Complaint and do not constitute
findings of fact by the Court.
Parties
Ashley Pelman, a minor, and her mother and natural guardian Roberta Pelman are residents of the Bronx, New York.
Jazlen Bradley, a minor, and her father and natural guardian Israel Bradley are residents of New York, New York.
The infant plaintiffs are consumers who have purchased and consumed the defendants' products and, as a result thereof,
have become overweight and have developed diabetes, coronary heart disease, high blood pressure, elevated cholesterol
intake, and/or other detrimental and adverse health effects as a result of the defendants' conduct and business practices.
Defendant McDonald's Corp. is a Delaware corporation with its principal place of business at One McDonald's Plaza, Oak
Brook, Illinois. It does substantial business with outlets in the State of New York, as well as throughout the fifty states and
the world.
Defendant McDonalds of New York is a New York State corporation with a registered agent office located at 80 State Street,
Albany, New York. It does substantial business with outlets and/or franchises in the State of New York.
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McDonalds is the owner, manager, franchisee and operator of defendants the Bruckner Boulevard and Jerome Avenue
outlets. Ashley and Roberta Pelman purchased and consumed food products at the Bruckner Boulevard outlet. Jazlen and
Israel Bradley purchased and consumed food products at the Jerome Avenue outlet. All products, ingredients, promotions
and advertisements sold, provided, utilized, advertised and promoted by the Jerome Avenue and Bruckner Boulevard
outlets were authorized by McDonalds Corp. and McDonalds of New York.
McDonalds Corp. and McDonalds of New York, through its agents, servants, and/or employees, operate both company-owned
outlets and franchises, and prescribe their ingredients, qualities and quantities of the food products served, so as to insure
that its food products sold in one state or location is substantially identical to food products sold elsewhere in the country.
Obesity in Young Persons and its Effects
Today there are nearly twice as many overweight children and almost three times as many overweight adolescents as there
were in 1980. In 1999, an estimated 61 percent of U.S. adults were overweight or obese and 13 percent of children aged 6 to
11 years and 14 percent of adolescents aged 12 to 19 years were overweight. In 1980, those figures for children were 7
percent for children aged 6 to 11 years and 5 percent for adolescents aged 12 to 19 years.
Obese individuals have a 50 to 100 percent increased risk of premature death from all causes. Approximately 300,000
deaths a year in the United States are currently associated with overweight and obesity. As indicated in the U.S. Surgeon
General's 2001 Report on Overweight and Obesity, "left unabated, overweight and obesity may soon cause as much
preventable disease and death as cigarette smoking."
Obesity and overweight classification are associated with increased risk for coronary heart disease; type 2 diabetes;
endometrial, colon, postmenopausal breast and other cancers; and certain musculoskeletal disorders, such as knee
osteoarthritis.
Studies have shown that both modest and large weight gains are associated with significantly increased risk of diseases.
For example, a weight gain of 11 to 18 pounds increases a person's risk of developing type 2 diabetes to twice that of
individuals who have not gained weight, while those who gain 44 pounds or more have four times the risk of coronary heart
disease (nonfatal myocardial infarction and death) of 1.25 times in women and 1.6 times in men. A gain of 22 pounds in
men and 44 pounds in women result in an increased coronary heart disease risk of 1.75 and 2.65, respectively.
In certain obese women, the risk of developing endometrial cancer is increased by more than six times. Overweight and
obesity are also known to exacerbate many chronic conditions such as hypertension and elevated cholesterol and such
individuals may also suffer from social stigmatization, discrimination and poor body image.
In 1995, the total estimated costs attributable to obesity amounted to an estimated $99 billion. In 2000, the cost of obesity
was estimated to be $117 billion. Most of the costs associated with obesity arise form type 2 diabetes, coronary heart
disease and hypertension.
Claims
The plaintiffs allege five causes of action as members of a putative class action of minors residing in New York State who
have purchased and consumed McDonalds products. Counts I and II are based on deceptive acts and practices in violation
of the Consumer Protection Act, and , and the New York City Administrative Codes, Chapter 5, 20-700 et seq. Count I
alleges that McDonalds failed to adequately disclose the ingredients and/or health effects of ingesting certain of their food
products with high levels of cholesterol, fat, salt and sugar; described their food as nutritious; and engaged in marketing to
entice consumers to purchase "value meals" without disclosing the detrimental health effects thereof. Count II focuses on
marketing techniques geared toward inducing children to purchase and ingest McDonalds' food products. Count III sounds
in negligence, alleging that McDonalds acted at least negligently in selling food products that are high in cholesterol, fat,
salt and sugar when studies show that such foods cause obesity and detrimental health effects. Count IV alleges that
McDonalds failed to warn the consumers of McDonalds' products of the ingredients, quantity, qualities and levels of
cholesterol, fat, salt and sugar content and other ingredients in those products, and that a diet high in fat, salt, sugar and
cholesterol could lead to obesity and health problems. Finally, Count V also sounds in negligence, alleging that McDonalds
acted negligently in marketing food products that were physically and psychologically addictive.
Discussion
I. Diversity Jurisdiction Exists, and the Plaintiffs' Motion to Remand Is Denied
In order to rule on this motion, this Court must have jurisdiction. Defendants removed to federal court alleging that
diversity jurisdiction exists pursuant to .
states, in pertinent part, that:
(a) The district court shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or
value of $75,000, exclusive of interest and costs, and is between-(1) Citizens of different States ....
. requires complete diversity of citizenship; therefore no defendant may share citizenship with a plaintiff. . There is no
dispute that all of the plaintiffs are New York residents and that three of the defendants--McDonalds of New York, the
Bruckner Boulevard outlet, and the Jerome Avenue outlet--are New York residents. Therefore, unless the three nondiverse defendants were "fraudulently joined" to defeat jurisdiction, complete diversity does not exist, and this Court lacks
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subject matter jurisdiction over the controversy.
As an initial matter, although this concept is described as "fraudulent joinder," suggesting that the determinative issue is
one of motive, motive in fact has nothing to do with it. ("The only issue is whether the plaintiff has a legitimate claim
against the non-diverse or in-state defendant--whether, in other words, the plaintiff has a real or direct interest in the
controversy vis-a-vis the non-diverse or in-state defendant ...."). The standard for determining whether a plaintiff's claim
against a defendant is sufficiently substantial to defeat removal jurisdiction is governed by .
In order to show that a non-diverse defendant was fraudulently joined to defeat diversity jurisdiction, the defendant must
demonstrate, by clear and convincing evidence, either that there has been outright fraud committed in the plaintiffs'
pleadings, or that there is no reasonable basis, based on the pleadings, for liability against the non-diverse defendants in
light of the claims alleged. (quoting The burden on a removing defendant to meet this standard is a heavy one, and all
reasonable doubts of fact and law are resolved in favor of the plaintiff. "Nevertheless, the burden is not impossible of
satisfaction." .
In order to interpret the legal standards stated above, it is necessary to look to the "realities of the record." . The
discussion of whether the plaintiffs have stated a claim against the outlets and McDonalds of New York necessarily augurs
the discussion, infra, of whether the Complaint should be dismissed. For ease of reading, this section summarizes the later
analysis.
A. The Outlets
Plaintiffs have chosen to join as defendants two of McDonalds' myriad outlets in New York State--both of which happen to
be located in the Bronx, New York. As an initial matter, it is worth noting that this action is labeled a statewide class action,
and any putative class members will certainly have eaten at other outlets than the ones named in the Complaint.
With regard to the claims under the Consumer Protection Act, as discussed infra, plaintiffs fail to cite any specific
advertisements or public statements that may be considered "deceptive" on the part of any of the defendants, including the
outlets. In addition, while the Complaint does cite to specific omissions on the part of all defendants--namely the failure to
include nutritional labeling at points of purchase --it does not claim that the outlets had any particular knowledge in their
possession and not in the public's possession that would require them to post such information. Therefore, the plaintiffs
have not stated a claim against the outlets under the Consumer Protection Act.
Because the outlets utilize labels presumably created at the national level, they cannot be responsible for the lack
of nutritional labeling on the packaging itself.
Plaintiffs also cannot state the negligence claims against the outlets. First, plaintiffs have failed to establish that any of the
defendants have produced a product that was so unhealthy as to be outside a reasonable's consumer's expectations. A
larger problem is raised here with regard to probable cause than that pointed out later in the discussion of McDonalds'
motion to dismiss. Normally, a products liability action that is brought against retailers, distributors and manufacturers is
premised on an injury that results from the use of a single item that was purchased from a particular retailer and
distributor. Here, however, the claim is premised on an over-consumption of products specified and provided by the national
defendant, McDonalds Corp. In order to establish proximate cause, the injury of over- consumption must somehow be tied to
the outlets. Presumably, that would require, in addition to alleging the facts discussed infra, some allegation that plaintiffs
ate primarily at the particular outlet. In the absence of such allegations, a claim against the outlets cannot stand.
A typical products liability case would involve a fact pattern where a plaintiff discovers something unsavory or
dangerous in a meal purchased at a McDonalds outlet, such as, for instance, a chicken head. E.g., "You Deserve a
Beak Today," The Wash. Post, at C13 (Dec. 1, 2000) (reporting that a Newport News, Virginia woman found
breaded and fried chicken head--including the beak, eyes and comb--in a box of McDonalds chicken wings). Such a
situation clearly ties in the outlet that sold that particular order of chicken wings. Of course, New York's specific
rules concerning liability of retailers and distributors also applies, as discussed in Part I.C.
B. McDonalds of New York
The inclusion of McDonalds of New York is more logical than the inclusion of two of the many McDonalds outlets in New
York State. Plaintiffs nonetheless fail to state a claim for similar reasons discussed above.
First, with regard to the Consumer Protection Act, there is no allegation of any specific advertisements or public statements
arising from McDonalds of New York. Further, there is no allegation that McDonalds of New York had in its possession any
particular knowledge that consumers did not have that would require it to promulgate information about the nutritional
contents of the products. Therefore, the deceptive practices claim cannot stand against McDonalds of New York.
Second, the negligence claims fail for the same reasons discussed above and in greater detail below. There is no allegation
that McDonalds of New York has produced or distributed a product that is so dangerous that its danger is outside the
reasonable understanding of a consumer. Further, the proximate cause issues discussed below also inhibit this claim. It
should be noted that the proximate cause issue discussed above--tying the injury to a particular outlet--is not as damaging
against the claim against McDonalds of New York. However, plaintiffs must allege that they have eaten primarily, if not
wholly, at McDonalds of New York outlets. In other words, a plaintiff who has lived for merely a year in New York State-and thus eaten at outlets run by McDonalds of New York only for one year--may have a difficult time in showing causation.
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The absence of explicit allegations to this effect provides a further ground for dismissal of the Complaint as against
McDonalds of New York.
C. The Outlets and McDonalds of New York Are Akin to Retailers and Distributors of McDonalds Corp.'s
Products
In addition, because the outlets and McDonalds of New York are akin to retailers and distributors of a manufacturer's
products, the negligence claims cannot attach to the outlets and McDonalds of New York for the following reasons.
Under New York law, a wholesaler, retailer or distributor can be held liable in negligence for the sale of a defective product
or for failure to warn only if it fails to detect a dangerous condition that it could have discovered during the course of a
normal inspection while the product was in its possession. E.g., (holding rental service not liable for defective condition
because satisfied duty to inspect) (citing ); (failure to warn) (citing ).
As both parties have invoked New York law, there is no need to undertake a choice of law inquiry. (citing ; ; ).
It is unclear whether the defects in question--high levels of cholesterol, fat, salt and sugar--were "discoverable" upon
"inspection." Given McDonalds' common knowledge arguments with regard to the attributes, however, it may be assumed
so. In any case, however, those attributes are later found insufficient as a matter of law to establish products liability. In
order to state a claim against the outlets and McDonalds of New York, the plaintiffs must allege that they were in
possession of information that the McDonalds Corp. products that they sold were more dangerous than a reasonable
consumer would expect. Plaintiffs have failed to make such allegations.
By contrast, to return to the example of the fried chicken head (supra note 7), such defective product clearly should
have been discovered upon inspection.
This lawsuit is not the typical products liability case because, as referred to above, the issue is over-consumption of products
created, manufactured and advertised at a national level. A McDonalds' Big Mac is the same at every outlet in the Bronx,
New York; the same at every outlet in the State of New York; and the same at every outlet throughout the United States.
Clearly what is at issue in this lawsuit is the national menu and national policy of McDonalds Corp., and the plaintiffs' real
beef is with McDonalds Corp.
As a result, the motion to remand is denied.
II. McDonalds' Motion to Dismiss
A. Standard of Review
In reviewing a motion to dismiss under , courts must "accept as true the factual allegations of the complaint, and draw all
inferences in favor of the pleader." (citing ). However, "legal conclusions, deductions, or opinions couched as factual
allegations are not given a presumption of truthfulness." . The complaint may only be dismissed when "it appears beyond
doubt that the plaintiff can prove no set of facts in support of his claim which would entitled him to relief." . See also ; .
Review must be limited to the complaint and documents attached or incorporated by reference thereto. . In this context,
the Second Circuit has held that a complaint is deemed to "include ... documents that the plaintiffs either possessed or knew
about and upon which they relied in bringing the suit." .
Plaintiffs, however, in their opposition papers rely on facts outside the pleading. The Court of Appeals has made clear that
where a District Court is provided with materials outside the pleadings in the context of a 12(b)(6) motion to dismiss, it has
two options: the court may exclude the additional materials and decide the motion on the complaint alone or convert the
motion to one from summary judgment under and afford all parties the opportunity to present supporting material. .
(quoting ). The Court has not converted this motion to one for summary judgment and thus will not consider statements
outside the pleadings in reaching its holding.
B. Counts I and II: Plaintiffs Fail to State a Claim Pursuant to and
Counts I and II allege that McDonalds violated the New York Consumer Protection Act, and , by (1) deceptively advertising
their food as not unhealthful and failing to provide consumers with nutritional information (Count I) and (2) inducing
minors to eat at McDonalds through deceptive marketing ploys (Count II).
The Complaint also asserts that such actions violated the City of New York's Consumer Protection Law, Admin.
Code, Chapter 5, 20-700 et seq. McDonalds argues, and the plaintiffs do not contest, that such actions may only be
brought by the Commissioner of Consumer Affairs. E.g., . Therefore, Counts I and II are dismissed to the extent
they assert claims pursuant to the Administrative Code.
makes unlawful "[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any
service in this state." . prohibits "[f]alse advertising in the conduct of any business." . To state a claim for deceptive
practices under either section, a plaintiff must show: (1) that the act, practice or advertisement was consumer-oriented; (2)
that the act, practice or advertisement was misleading in a material respect, and (3) that the plaintiff was injured as a
result of the deceptive practice, act or advertisement. E.g., ; ; . See also . The standard for whether an act or practice is
misleading is objective, requiring a showing that a reasonable consumer would have been misled by the defendant's conduct.
; . Omissions, as well as acts, may form the basis of a deceptive practices claim. (citing (delineating different inquiry in
case of claim of deceit by omission)). Further, traditional showings of reliance and scienter are not required under the act.
(Weinstein, J.).
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As indicated by the statute's "expansive" language, was intended to be broadly applicable, extending far beyond the
reach of common law fraud. (upholding claim under that tobacco companies engaged in scheme to distort public
knowledge concerning risks of smoking); ("In contrast to common- law fraud, is a creature of statute based on
broad consumer-protection concerns."); ("The reach of th[is] statut[e] 'provide[s] needed authority to cope with the
numerous, ever-changing types of false and deceptive business practices which plague consumers in our State.' ")
(quoting N.Y. Dept. of Law, Mem. to Governor, 1963 N.Y. Legis. Ann., at 105).
McDonalds argues that plaintiffs' claims under and fail because (1) they are not plead with sufficient specificity, and (2)
acts or practices cannot be deceptive if the consuming public is already aware of the "concealed" characteristics and
therefore is not deceived. McDonalds also argued for the first time in its reply papers that plaintiffs' claims are pre- empted
by federal law. Although raised last, the pre-emption argument will be addressed first.
1. Federal Pre-Emption
McDonalds raises for the first time in its reply brief an argument that its compliance with (or rather, exemption from) the
Federal Nutritional Labeling and Education Act, , bars the plaintiffs' contentions that McDonalds' failure to provide
nutritional information is deceptive. Defs.' Reply Mem. at 24. requires labels with specified nutritional values to be
attached to all packaged food, but it specifically exempts restaurants from this requirement. (labeling requirements "shall
not apply to food which is served in restaurants or other establishments in which food is served for immediate human
consumption or which is sold for sale or use in such establishments"). McDonalds thus argues that if Congress determined
that restaurants should not have to label their food, McDonalds cannot be made to do so indirectly, pursuant to a New York
State statute.
The argument will be addressed although raised tardily because the plaintiffs had an opportunity to respond in
their sur-reply brief, because the and claims are to be dismissed on other grounds in any case, and because it is
held that the claims are not pre- empted.
State law that conflicts with federal law is without effect. (citing ). However, "the historic police powers of the States [are]
not to be superseded by ... Federal Act unless that [is] the clear and manifest purpose of Congress." (brackets in original)
(quoting ).
, the NLEA's pre-emptive provision, provides that no state may require nutrition labeling for food in interstate commerce
that is not identical to that prescribed by the NLEA. ; see also . This provision would seem to support McDonalds'
argument. However, subsection (4) of the pre-emptive provision specifically permits states to require nutrition labeling of
food that is exempt under subclause (i) or (ii) of . . As noted above, is the very provision on which McDonalds relies to
state that it has "complied" with federal regulations and that the State of New York cannot make it do anything more.
Therefore, does not expressly bar nutrition labeling on restaurant foods either directly or, as plaintiffs seek to do in this
action based on a New York state statute, indirectly. A finding that a lack of nutritional labeling on McDonalds' products
violates and therefore is explicitly not pre-empted by the NLEA. In fact, in discussing its rules and regulations
implementing the NLEA, the Food and Drug Administration recognized that states could protect their consumers in this
manner. FDA, ("States remain free, however, to ensure under their own consumer protection laws that menus do not
provide false or misleading information."). McDonalds' late-breaking arguments are accordingly rejected.
2. Requirements of and
McDonalds argues that plaintiffs' claims under and fail because (1) they are not plead with sufficient specificity, and (2)
acts or practices cannot be deceptive if the consuming public is already aware of the "concealed" characteristics and
therefore is not deceived.
A plaintiff must plead with specificity the allegedly deceptive acts or practices that form the basis of a claim under the
Consumer Protection Act. E.g., ("In pleading a claim under the Consumer Protection Act, a plaintiff is required to set forth
specific details regarding the allegedly deceptive acts or practices."); ("Conclusory allegations have been held insufficient to
state a claim under ."); (discussing violation of Insurance Law alleged to be deceptive practice under ). See also ("plaintiffs
do not point to any specific advertisement or public pronouncement").
For instance, one of the cases on which plaintiffs rely, provides examples of such specific statements. The case involved a
claim under against cigarette manufacturers, alleging deceptive practices. In the 175-page complaint, filed on April 29,
1998, the plaintiffs included a number of specific allegations of deceptive acts and practices, including the following:
• a statement that "no causal link between smoking and disease has been established" (Blue Cross Complaint, ¶ 112);
• a letter to a grade school principal stating that "scientists don't know the cause or causes of the chronic diseases
reported to be associated with smoking" (Id., ¶ 113);
• testimony under oath by a tobacco executive that he did not believe that people die from smoking (Id., ¶ 114);
• Congressional testimony by tobacco executives stating that tobacco companies did not manipulate, add, control or
restore nicotine during the manufacturing process (Id., ¶ 219);
• advertisements denying that tobacco companies believed cigarette smoking was addictive (Id., ¶ 220); and
• statements in newspaper advertisements that claimed "Phillip Morris does not believe that cigarette smoking is
addictive" (Id., ¶ 221).
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Many of the practices were found to have supported liability in the opinion on which the plaintiffs rely.
Because such
statements are necessarily "consumer- oriented" and thus in the public domain, plaintiffs should be able similarly to point to
the specific statements that form the basis of their claims pursuant to and .
a. Count I
In Count I, plaintiffs allege that McDonalds violated the act both by commission (e.g., stating that its products were
nutritious, encouraging consumers to "supersize" their meals without disclosing the negative health effects) and by omission
(e.g., failing to provide nutritional information for products).
i. Deceptive Acts
Because the Complaint does not identify a single instance of deceptive acts, Count I shall be dismissed to the extent it
alleges deceptive practices of commission in violation of and .
Although the Court is limited to allegations in the Complaint for the purposes of deciding this motion, it is worth noting
that, even in their opposition papers, the plaintiffs only cite to two advertising campaigns ("McChicken Everyday!" and "Big
N' Tasty Everyday") and to a statement on the McDonalds' website that "McDonalds can be part of any balanced diet and
lifestyle." These are specific examples of practices, act or advertisements and would survive a motion to dismiss based on
lack of specificity. Whether they would survive a motion to dismiss on the substantive issue of whether such practices, act
and advertisements are deceptive is less clear.
The two campaigns encouraging daily forays to McDonalds and the
statement regarding making McDonalds a part of a balanced diet, if read together, may be seen as contradictory--a balanced
diet likely does not permit eating at McDonalds everyday. However, the advertisements encouraging persons to eat at
McDonalds "everyday!" do not include any indication that doing so is part of a well-balanced diet, and the plaintiffs fail to
cite any advertisement where McDonalds asserts that its products may be eaten for every meal of every day without any ill
consequences. Merely encouraging consumers to eat its products "everyday" is mere puffery, at most, in the absence of a
claim that to do so will result in a specific effect on health. As a result, the claims likely would not be actionable if alleged.
See ("the sort of subjective claims of product quality at issue here are nonactionable"); (finding claim of "thorough"
research to be "mere puffery" and not actionable as false advertising under § 43(a) of Lanham Act); ("that characterization,
even if factually incorrect, was standard industry puffing that does not rise to the level of consumer deception").
Of course, some people manage to eat at McDonalds everyday with no apparent ill effects. Witness the wellpublicized fact that a Wisconsin man, Don Gorske, has eaten a Big Mac a day for approximately 30 years, while
maintaining his svelte 178-pound, six-foot frame and a modest cholesterol level. E.g., "Man Eats His 18,000th Big
Mac," available at www.click2houston.com/sh/news/stories/nat -news-105595720011106191107.html (last visited
Jan. 6, 2003) (reporting that Gorske set world record for number of Big Macs eaten while maintaining modest
cholesterol level of 155); "Deserving a Break--and Getting It Every Day," AFSCME website, available at
www.afscme.org/publications/public_employee/2002/pejf0221.htm (last visited Jan. 6, 2003) (noting that Gorske has
consumed more than 800 heads of lettuce, 820 onions, 1,900 whole pickles, 563 pounds of cheese, 100 gallons of
special sauce, 14 1/2 cattle, and 6.25 million sesame seeds, but that he skips breakfast and dinner and only eats
lunch of Big Mac, fries and Coke).
Puffery is defined as exaggerated general statements that make no specific claims on which consumers could rely.
E.g., (citing ).
For example, one of McDonalds' competitors, SUBWAY Restaurants, has engaged in just such a campaign,
highlighting that it is the "healthier alternative to fatty fast food." SUBWAY website, press release (Nov. 18,
1999), available at www.subway.com/society/public_rel/pcr_ press/111899pr.htm (last visited Jan. 6, 2003).
Furthermore, it has hired as a spokesman Jared S. Fogle and has widely publicized the results of Mr. Fogle's
"SUBWAY diet." Over the course of less than a year, Fogle went from 425 pounds to 190 pounds by eating his only
meals from SUBWAY's low- fat menu.
SUBWAY website, "Jared's Statistics," available at
www.subway.com/society/foj/jared_stats.stm (last visited Jan. 6, 2003). Plaintiffs, however, have not referred the
Court to any similar advertisements by McDonalds.
On December 11, 2002, the Court accepted from plaintiffs a number of documents concerning actions taken against
McDonalds' advertising practices in the late 1980's by the state attorneys general from several states, including New York
State. While any claim based on the advertisements at issue likely would be time barred, (three-year limitations period for
deceptive practices actions), a review of those advertisements and the state attorney generals' analysis of them may assist
plaintiffs in shaping a claim under the Consumer Protection Act. For instance, by letter dated April 24, 1987 (the "Abrams
Letter"), Robert Abrams, the then-Attorney General of the State of New York, addressed several specific allegedly deceptive
claims in McDonalds advertisements:
1. The advertisement discussing salt (sodium) content in foods says, "Our sodium is down across the menu." (emphasis
added) This is not true. That same advertisement lists four products (regular fries, regular cheeseburger, 6- piece
McNuggets, and vanilla milkshake), none of which have had their sodium content lowered in the past year.
2. The advertisement touting the "real" milk in McDonald's shakes says that they contain "Wholesome milk, natural
sweeteners, a fluid ounce of flavoring, and stabilizers for consistency. And that's all." In fact, that's not really all.
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McDonald's own ingredient booklet shows that a typical shake, such as vanilla or strawberry, actually contains artificial
flavor and sodium benzoate and sodium hexametaphosphate, two chemical preservatives. This advertisements tells only
part of the story.
3. The cholesterol advertisement emphasizes the relatively low (29 milligrams) cholesterol content of the regular
hamburger, but does not even mention the saturated fat content, a fact much more relevant to those with cause for
concern about heart disease.
Abrams Letter, at 1-2.
ii. Deceptive Omissions
The second subset of Claim I focuses on McDonalds' failure to label its foods with their nutritional content. Unlike above,
the plaintiffs clearly have outlined the allegedly deceptive practice: the fact that McDonalds failed to post nutritional
labeling on the products and at points of purchase. However, because this is a purportedly deceptive act based on an
omission, it is not sufficient for the plaintiffs to point to the omission alone. They must also show why the omission was
deceptive--a duty they have shunned.
The New York Court of Appeals has addressed what requires in a situation involving an allegedly deceptive omission.
(Kaye, C.J.) involved a claim that defendant bank acted deceptively in not informing the plaintiff that for-profit entities
would not receive interest on accounts in excess of $100,000. The Court reasoned that in a case involving omissions, "the
statute surely does not require businesses to ascertain consumers' individual needs and guarantee that each consumer has
all relevant information specific to its situation." It provided an exception, however, "where the business alone possesses
material information that is relevant to the consumer and fails to provide this information." It was thus held that the
plaintiffs had stated a cause of action, but that liability would turn on whether the plaintiffs possessed, or could reasonably
have obtained, the information regarding interest on for- profit entities' accounts in excess of $100,000. see also (rejecting
claim for deceptive practices based on Avis's failure to disseminate information that its Collision Damage Waiver insurance
duplicated the plaintiffs' own automobile insurance because Avis had no duty to inform where the customer with CDW
coverage in place was in a far better position to ascertain the relevant conditions and exclusions relating to his or her
coverage than Avis).
The plaintiffs fail to allege that the information with regard to the nutritional content of McDonalds' products was solely
within McDonalds' possession or that a consumer could not reasonably obtain such information. It cannot be assumed that
the nutritional content of McDonalds' products and their usage was solely within the possession of McDonalds.
Although the plaintiffs do not allege it as part of Count I or II, the allegations contained in Count V--that
McDonalds serves addictive products--would present a closer question as to a deceptive omission in violation of the
Act, as such information is not available to the public.
b. Count II
Count II, which focuses on representations targeting children, fails for the same reasons discussed above. The Complaint
does not identify a single specific advertisement, promotion or statement directed at infant consumers, and Count II must be
dismissed in the absence of such specificity.
As with the first subset of Count I, the plaintiffs have attempted to point out potential specific acts in their opposition
papers. They focus on two specific promotions geared toward minors: (1) a plastic beef steak figure named "Slugger,"
accompanied by a nutritional pamphlet encouraging children to eat two servings a day in the meat group to "make it easier
to do things like climb higher and ride your bike farther," (Pls.' Mem. at 48-49 n. 53) and (2) promotions of the "Mighty Kids
Meal," a souped-up Happy Meal, that equate eating the larger-portioned meal with being more grown-up. With regard to
the latter, plaintiffs still fail to identify specific exhortations or promises associated with the Mightier Kids Meals, and such
bare allegations would also be dismissed for lack of specificity were they included in an amended complaint. In any case, if
plaintiffs are only concerned about the appellation "Mightier Kids Meal," such name is seemingly mere puffery, rather than
any claim that children who eat a "Mightier Kids Meal" will become mightier. The former is sufficiently specific, were it
included in the Complaint, to survive a motion to dismiss for failure to state a claim with sufficient specificity. Of course,
plaintiffs would still have to set forth grounds to establish that the promotion was deceptive and that they suffered some
injury as a result of that particular promotion.
The plaintiffs also raise for the first time in their opposition papers an argument that McDonalds has acted duplicitously in
claiming that it is committed to providing nutritional information to its customers. This argument also fails for lack of
specificity; the plaintiffs do not cite to a particular recent occasion where McDonalds has stated such commitment. Even if
this allegation were to be included in the Complaint, its deceptive nature is unclear. Plaintiffs admit that McDonalds has
made its nutritional information available online and do not contest that such information is available upon request.
Unless McDonalds has specifically promised to provide nutritional information on all its products and at all points of
purchase, plaintiffs do not state a claim.
As discussed above, plaintiffs have produced a number of documents from the late 1980's concerning discussions
between McDonalds and state attorneys general, including the attorney general of the State of New York, requiring
the discontinuance of certain advertising practices. As also discussed above, any cause of action based on such
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statements would likely be barred by the statute of limitations. E.g., (three-year limitations period for deceptive
practices actions). The same is true for the advertisements plaintiffs cite to from McDonalds v. Steele, No.1990-MNo.S724, presented in the United Kingdom, Royal Courts of Justice. Pls.' Mem. at 7.
III. Counts III, IV and V: Negligence Claims
The plaintiffs' common law claims against McDonalds sound in negligence, alleging that McDonalds was negligent in
manufacturing and selling its products and negligent in failing to warn consumers of the potential hazards of eating its
products. McDonalds argues that each of these claims fail as a matter of law because (1) the attributes about which
plaintiffs complain were so well- known that McDonalds had no duty either to eliminate such attributes or to warn plaintiffs
about them, and (2) the plaintiffs cannot establish proximate cause.
A. Count III: Inherently Dangerous Food
1. Whether McDonalds Had a Duty to Plaintiffs Because the Dangers Were Not Within Common Knowledge
In addition to the allegations in the Complaint with regard to McDonalds' duty, arguments raised for the first time in the
papers on this motion will be addressed.
a. Allegations Within the Complaint
Count III essentially alleges that McDonalds' products are inherently dangerous because of the inclusion of high levels of
cholesterol, fat, salt and sugar. McDonalds argues that because the public is well aware that hamburgers, fries and other
fast food fare have such attributes, McDonalds cannot be held liable. E.g., ("Where as here a product by its very nature has
a dangerous attribute, liability is imposed only when the product has an attribute not reasonably contemplated by the
purchaser or is unreasonably dangerous for its intended use.") (quoting (citing )).
McDonalds cites to the Restatement (Second) of Torts and claims that because plaintiffs' claims hinge on injuries resulting
from excessive consumption of food, they face a high bar indeed:
Many products cannot possibly be made entirely safe for all consumption, and any food or drug necessarily involves some
risk of harm, if only from over- consumption. Ordinary sugar is a deadly poison to some diabetics, and castor oil found
use under Mussolini as an instrument of torture. That is not what is meant by "unreasonably dangerous" .... The article
sold must be dangerous to an extent beyond that which would be contemplated by the ordinary consumer who purchases
it, with the ordinary knowledge common to the community as to its characteristics. Good whiskey is not unreasonably
dangerous merely because it will make some people drunk, and is especially dangerous to alcoholics; but bad whiskey,
containing a dangerous amount of fuel oil, is unreasonably dangerous. Good tobacco is not unreasonably dangerous merely
because the effects of smoking may be harmful; but tobacco containing something like marijuana may be unreasonably
dangerous. Good butter is not unreasonably dangerous merely because, if such be the case, it deposits cholesterol in the
arteries and leads to heart attacks; but bad butter, contaminated with poisonous fish oil, is unreasonably dangerous.
McDonalds, when citing the above passage, did not quote the sentence concerning "good tobacco." Likely this is
because the authors of the Restatement, writing in the 1960's, did not envision the successful tobacco litigation and
settlements of the 1990's. See Comment, (discussing failure of tobacco litigation from the 1950's until 1994 when
new theory of addiction-as-injury emerged based on " 'decades-long industry effort to conduct, control, and
ultimately suppress' the results of the industry's extensive research into tobacco's addiction potential and the
industry's ultimately exploitation of this potential") (citation omitted); Jon D. Hanson & Kyle D. Logue, The
(discussing unsuccessful waves of litigation up until recently and that recent cases--as a result, inter alia, of
revelations that tobacco companies knew cigarettes were addictive and manipulated the addictiveness through
controlling nicotine levels--"pose a considerable threat to the cigarette industry"); see also, e.g., (noting jury verdict
in favor of plaintiff's claims on failure to warn, negligent testing and research and fraudulent concealment based on
assertions that defendant cigarette manufacturer caused his peripheral vascular disease and addiction).
This lack of foresight suggests that perhaps the Restatement's vision concerning over-consumption may be rendered
obsolete. Seemingly "good" products may be manipulated such that they are more akin to fuel-oil contaminated
whiskey and marijuana-laced cigarettes.
, cmt. i.
Relevant to Count IV, it also stated that "a seller is not required to warn with respect to products, or ingredients in
them, which are only dangerous, or potentially so, when consumed in excessive quantity, or over a long period of
time, when the danger, or potentiality of danger, is generally known and recognized." Id., , cmt. j; see also .
When asked at oral argument to distinguish this case from those cases involving injuries purportedly caused by asbestos
exposure, counsel for the defendants stated that in this case, the dangers complained of have been well- known for some
time, while the dangers of asbestos did not became apparent until years after exposure. The Restatement provision cited
above confirms this analysis, recognizing that the dangers of over-consumption of items such as alcoholic beverages, or
typically high-in-fat foods such as butter, are well-known. Thus any liability based on over-consumption is doomed if the
consequences of such over-consumption are common knowledge.
It is worth noting, however, that the Restatement provision cited above included tobacco as an example of products such as
whiskey and butter, the unhealthy over-consumption of which could not lead to liability. As the successful tobacco class
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action litigation and settlements have shown, however, the fact that excessive smoking was known to lead to health
problems did not vitiate liability when, for instance, tobacco companies had intentionally altered the nicotine levels of
cigarettes to induce addiction. E.g., (noting jury verdict in favor of plaintiff's claims on failure to warn, negligent testing
and research and fraudulent concealment based on assertions that defendant cigarette manufacturer caused his peripheral
vascular disease and addiction).
Thus, in order to state a claim, the Complaint must allege either that the attributes of McDonalds products are so
extraordinarily unhealthy that they are outside the reasonable contemplation of the consuming public or that the products
are so extraordinarily unhealthy as to be dangerous in their intended use. The Complaint--which merely alleges that the
foods contain high levels of cholesterol, fat, salt and sugar, and that the foods are therefore unhealthy--fails to reach this
bar. It is well-known that fast food in general, and McDonalds' products in particular, contain high levels of cholesterol, fat,
salt, and sugar, and that such attributes are bad for one.
E.g., John DeMers, "Fat Chance--Fast-food diet increases odds of obesity," Houston Chron. at 1, ("The more fast
food there was in America, the fatter America became. And the more likely a segment of the population was to
devour fast food regularly, the more it became fatter than any other segment.
Though we are ultimately
responsible for what we eat, fast food was 'making' us fat."); Caroline Foulkes, "Food & drink--Can't do the cooking?
Burger it." Birmingham Post, at P46 (9/21/02) ("Doctors have been warning us of the dangers of eating too much
fast food since burger outlets first became popular in Britain in the 1960's. But their advice has gone unheeded.");
Mark Kaufman, Washington Post, Wed. Oct. 16, 2002 ("The fast-food industry generally argues that its products
are a healthful part of a balanced diet, but critics say that heavy advertising of high-calorie fried foods encourages
people to eat unwisely."); Barbara F. Meltz, "Just Say 'Phooey' to the Food/Fun Link," Boston Globe, at H.6
(11/14/02), ("If children eat fast food once a week, it likely will not contribute to a health problem; if they eat it
three or more times a week, it might.").
Of course, there are competing claims that cholesterol, fat, salt and sugar may not be so bad after all. E.g., Gary
Taube, What If It's All Been a Big Fat Lie?, New York Times Magazine (July 7, 2002) (arguing that the high-fat
Atkins Diet is more successful than low-fat, high-carbohydrate diets), available at www.
nytimes.com/2002/07/07/magazine/ 07FAT.html (last visited Jan. 6, 2003). But see Bonnie Liebman, Big Fat Lies:
The Truth About the Atkins Diet, Nutrition Action Health Letter 1 (November 2002) (providing point-by-point
refutation of Taube's claims).
This rule makes sense in light of the policy issues discussed at the outset of this opinion. If a person knows or should know
that eating copious orders of supersized McDonalds' products is unhealthy and may result in weight gain (and its
concomitant problems) because of the high levels of cholesterol, fat, salt and sugar, it is not the place of the law to protect
them from their own excesses. Nobody is forced to eat at McDonalds. (Except, perhaps, parents of small children who
desire McDonalds' food, toy promotions or playgrounds and demand their parents' accompaniment.) Even more pertinent,
nobody is forced to supersize their meal or choose less healthy options on the menu.
See Testimony of Juliet Gellatley, in McDonalds v. Steele (cited in Pls.' Mem. at 47-48) ("[S]ome younger children
openly admitted that they pester their parents to take them to McDonalds, even if the parent is not keen.").
As long as a consumer exercises free choice with appropriate knowledge, liability for negligence will not attach to a
manufacturer.
It is only when that free choice becomes but a chimera--for instance, by the masking of information
necessary to make the choice, such as the knowledge that eating McDonalds with a certain frequency would irrefragably
cause harm--that manufacturers should be held accountable. Plaintiffs have failed to allege in the Complaint that their
decisions to eat at McDonalds several times a week were anything but a choice freely made and which now may not be
pinned on McDonalds.
b. Allegations Outside the Complaint
In an attempt to save their common law causes of action, plaintiffs raise four arguments that are not alleged in the
Complaint to show that McDonalds has a duty toward plaintiffs: (1) McDonalds' products have been processed to the point
where they have become completely different and more dangerous than the run-of-the-mill products they resemble and than
a reasonable consumer would expect; (2) plaintiffs have an allergic sensitivity to McDonalds' products; (3) McDonalds
should know that consumers would misuse products (presumably by eating in larger quantities or at greater frequencies
than is healthy); and (4) policy arguments based upon the Nutrition Labeling and Education Act. While the Court may only
consider allegations in the Complaint for the purposes of this motion, these arguments are important in determining
whether the plaintiffs should have the right to amend their complaint, as they point to potentially viable claims, and thus
will briefly be addressed.
i. Plaintiffs' Claim that McDonalds' Products Are More Dangerous Than the Average Hamburger, Fries and
Shake
For the first time in their opposition papers, the plaintiffs attempt to show that over-consumption of McDonalds is different
in kind from, for instance, over-consumption of alcoholic beverages or butter because the processing of McDonalds' food has
created an entirely different--and more dangerous--food than one would expect from a hamburger, chicken finger or french
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fry cooked at home or at any restaurant other than McDonalds. They thus argue that McDonalds' food is "dangerous to an
extent beyond that which would be contemplated by the ordinary consumer who purchases it, with the ordinary knowledge
common to the community as to its characteristics." , cmt. i. If true, consumers who eat at McDonalds have not been given a
free choice, and thus liability may attach.
The argument is akin to one that might be used in a products liability case regarding genetically engineered food, should
any injuries result from the excessive consumption thereof. The genetically modified soybean, potato and ear of corn look
exactly like the organically grown soybean, spud and corn. Yet those plants have been substantively, if subtly, modified
into something else. Any dangers from eating a genetically modified plant are latent--and thus not commonly well known-in the absence of a label revealing that the object that looks like a soybean is actually a soybean carrying a brazil nut
protein.
Genetic engineering is the process by which scientists make modifications of the deoxyribonucleic acid (DNA) of an
organism by uniting it with plant or animal genes with particular traits. Heather N. Ellison, . Recombinant DNA
(rDNA) techniques permit a scientist to identify and copy a specific gene and introduce the gene copies into
recipient organisms, such as a food crop. Id.; see also Lara Beth Winn, . This is done to introduce attributes of the
transferor organism into the transferee organism. Id. Genetic engineering has resulted, for example, in a tomato
that delays softening, an insect-protected potato and a virus-resistant squash. Jeffrey K. Francer, . In the year
2000, genetically modified seeds supplied approximately 38 percent of the United States corn crop, 57 percent of the
soybean crop and 70 percent of the canola crop. Kelly A. Leggio, Limitations on the Consumer's Right to Know:
Settling the Debate Over Labeling of Genetically Modified Foods in the United States, .
Although genetic
engineering thus far has apparently only been beneficial, there are concerns that genetically modified foods could
have far-reaching health effects that have not been accounted for, such as causing allergic reactions and creating
antibiotic resistance in consumers. Francer, supra, at 292-294; Leggio, supra, at 903.
Although not relevant to this case, it is worthwhile to note that McDonalds has had experience with the fear of
genetically modified foods.
In the fall of 1999, protesters dumped manure and rotting vegetables outside of
McDonalds restaurants in France, accusing McDonalds of contaminating their food with genetically modified crops.
Francer, In light of the protests, British McDonalds removed genetically modified foods from the menu that year,
id., and in the United States in the spring of 2000, McDonalds informed its french fry suppliers that it would no
longer purchase frozen french fries made from genetically engineered potatoes, in response to the consumer
backlash in Europe. Schlosser,
Pioneer Hi-Bred International, an Iowa agricultural life sciences company, added a Brazil-nut protein to soybeans
in order to enhance the soybean's growing power. While completing safety testing, researchers discovered that the
soybean also retained the Brazil nut's human allergenic traits. Although the soybeans were intended only for use
as animal feed, the product was not marketed due to fears of human consumption. Francer,
Similarly, plaintiffs argue that McDonalds' products have been so altered that their unhealthy attributes are now outside
the ken of the average reasonable consumer. They point to McDonalds' ingredient lists to show that McDonalds' customers
worldwide are getting much more than what is commonly considered to be a chicken finger, a hamburger, or a french fry.
Schlosser, supra, at 7 ("Foods that may look familiar have in fact been completely reformulated.").
For instance, Chicken McNuggets, rather than being merely chicken fried in a pan, are a McFrankenstein creation of
various elements not utilized by the home cook. A Chicken McNugget is comprised of, in addition to chicken:
water, salt, modified corn starch, sodium phosphates, chicken broth powder (chicken broth, salt and natural flavoring
(chicken source)), seasoning (vegetable oil, extracts of rosemary, mono, di- and triglycerides, lecithin). Battered and
breaded with water, enriched bleached wheat flour (niacin, iron, thiamine, mononitrate, riboflavin, folic acid), yellow corn
flour, bleached wheat flour, modified corn starch, salt, leavening (baking soda, sodium acid pyrophosphate, sodium
aluminum phosphate, monocalcium phosphate, calcium lactate), spices, wheat starch, dried whey, corn starch. Batter set
in vegetable shortening. Cooked in partially hydrogenated vegetable oils, (may contain partially hydrogenated soybean
oil and/or partially hydrogenated corn oil and/or partially hydrogenated canola oil and/or cottonseed oil and/or corn oil).
TBHQ and citric acid added to help preserve freshness. Dimethylpolysiloxane added as an anti-foaming agent.
Pls.' Mem. at 23 (citing McDonalds ingredient list). In addition, Chicken McNuggets, while seemingly a healthier option
than McDonalds hamburgers because they have "chicken" in their names, actually contain twice the fat per ounce as a
hamburger. Schlosser, supra, at 140. It is at least a question of fact as to whether a reasonable consumer would know-without recourse to the McDonalds' website--that a Chicken McNugget contained so many ingredients other than chicken
and provided twice the fat of a hamburger.
Similarly, it is hardly common knowledge that McDonalds' french fries are comprised, in addition to potatoes, of:
partially hydrogenated soybean oil, natural flavor (beef source), dextrose, sodium acid pyrophosphate (to preserve natural
color). Cooked in partially hydrogenated vegetable oils, (may contain partially hydrogenated soybean oil and/or partially
hydrogenated corn oil and/or partially hydrogenated canola oil and/or cottonseed oil and/or corn oil). TBHQ and citric
acid added to preserve freshness. Dimethylpolysiloxane added as an anti-foaming agent.
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Indeed, the taste of McDonalds fries depends largely on what is added to the fries--the cooking oil in which they are
fried. As Schlosser reports:
Their distinctive taste does not stem from the type of potatoes that McDonalds buys, the technology that processes
them, the restaurant equipment that fries them.
Other chains buy their french fries from the same large
processing companies, use Russet Burbanks, and have similar fryers in their restaurant kitchens. The taste of a
fast food fry is largely determined by the cooking oil. For decades [until 1990], McDonalds cooked its french fries in
a mixture of about 7 percent cottonseed oil and 93 percent beef tallow. The mix gave the fries their unique flavor-and more saturated beef fat per ounce than a McDonalds hamburger.
Schlosser, supra, at 120.
This argument comes closest to overcoming the hurdle presented to plaintiffs. If plaintiffs were able to flesh out this
argument in an amended complaint, it may establish that the dangers of McDonalds' products were not commonly well
known and thus that McDonalds had a duty toward its customers. The argument also addresses McDonalds' list of horribles,
i.e., that a successful lawsuit would mean that "pizza parlors, neighborhood diners, bakeries, grocery stores, and literally
anyone else in the food business (including mothers cooking at home)" (Defs.' Mem. at 3), could potentially face liability.
Most of the above entities do not serve food that is processed to the extent that McDonalds' products are processed, nor food
that is uniform to the extent that McDonalds' products are throughout the world.
Rather, they serve plain-jane
hamburgers, fries and shakes--meals that are high in cholesterol, fat, salt and sugar, but about which there are no
additional processes that could be alleged to make the products even more dangerous. In addition, there is the problem of
causation; hardly any of the entities listed above other than a parent cooking at home serves as many people regularly as
McDonalds and its ilk.
McDonalds claims to have served "over 99 billion," and each day services approximately 46 million customers. Pl.'s
Mem. at 2. McDonalds, with approximately 13,000 outlets in the United States, has a 43 percent share of the
United States fast food market. Id.
In response to this argument, McDonalds claims that, even if true, it is also a matter of common knowledge that any
processing that its foods undergo serve to make them more harmful than unprocessed foods. Defs.' Reply Mem. at 12- 13.
It is premature to speculate as to whether this argument will be successful as a matter of law if the plaintiffs amend their
complaint to include these allegations, as neither argument has been more than cursorily presented to the Court and
certainly is not properly before it. McDonalds' argument is insufficient, however, to convince this Court that the plaintiffs
should not have the opportunity to amend their complaint to include these allegations.
ii. Allergic Sensitivity
Plaintiffs also argue in their papers, less successfully, that McDonalds has a duty to plaintiffs because they have an "allergic
sensitivity" to McDonalds fare. E.g., .
To state such a claim, however, "the ingredient that causes the allergic reaction must be one whose danger or whose
presence in the product is not generally known to consumers. When both the presence of an allergenic ingredient in the
product and the risks presented by such an ingredient are widely known, instructions and warnings about that danger are
unnecessary." Id.; see also (holding that existence of duty depends upon manufacturer's actual or constructive knowledge
that product contains ingredient to which substantial number of population is allergic) (citing Tentative Draft No. 7 of
Restatement (Second) Torts).
As noted above, there are no allegations in the Complaint with regard to this claim. Plaintiffs have not alleged that
cholesterol, fat, salt and sugar--or any other ingredients in McDonalds products--are "allergens," nor have they made the
case that the existence and effects of such ingredients are unknown to the public at large.
In the absence of such
allegations, the theory fails.
iii. Foreseeable Misuse
Plaintiffs also attempt to ground a duty in a claim that eating McDonalds with high frequency is a "misuse" of the product of
which McDonalds is aware. Again, such allegation was not in the Complaint, and, in any case, plaintiffs fail to allege even
in their papers that what is at issue is a misuse "in the sense that it was outside the scope of the apparent purpose for which
the [products] were manufactured." . McDonalds' products were manufactured for the purpose of being eaten, and the
injuries complained purportedly resulted from the eating of those products. Plaintiffs cite no case law to support the
contention that over-consumption of a food product may be considered a misuse. If they amend their complaint to include
an allegation based on misuse, they had better be prepared to do so.
A better argument based on over-consumption would involve a claim that McDonalds' products are unreasonably dangerous
for their intended use. The intended use of McDonalds' food is to be eaten, at some frequency that presents a question of
fact. If plaintiffs can allege that McDonalds products' intended use is to be eaten for every meal of every day, and that
McDonalds is or should be aware that eating McDonalds' products for every meal of every day is unreasonably dangerous,
they may be able to state a claim.
iv. The NLEA
Plaintiffs finally attempt to rely on the NLEA, arguing that any finding that McDonalds does not have to label its foods
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would mean that the NLEA is not worth the paper it is written upon. Plaintiffs' bizarre argument confuses the instant
case--a common law negligence and state statutory cause of action--with any enforcement proceedings by the federal
government to ensure that those covered by the NLEA (from which McDonalds and other restaurants are exempt, as
discussed above) have the nutritional labeling required by the act. Any determination in this case has nothing to do with
whether Haagen-Daaz must include a label as to the nutritional contents of a pint of ice cream. Plaintiffs might just as well
argue that this case will affect the labeling of tea in China.
Because Count III has failed to state a claim, it is dismissed.
2. Proximate Cause
McDonalds also argues that Count III should be dismissed because the plaintiffs may not as a matter of law allege that the
unhealthy attributes of McDonalds' products were the proximate cause of their obesity and other health problems.
As an initial matter, plaintiffs object that McDonalds' arguments as to duty and proximate cause are contradictory
and self- serving. They argue that McDonalds cannot, on one hand, state that it is obvious that eating McDonalds'
food will cause the injuries complained of, and then argue that plaintiffs have failed to demonstrate that eating
McDonalds' food is the proximate cause of their injuries. McDonalds' point, however, is not that the plaintiffs
became obese necessarily for some reason other than their diet of foods high in cholesterol, fat, salt and sugar, but
that it is impossible as a matter of law to blame one restaurant chain--even one responsible for up to seven meals a
week of a plaintiff--when the plaintiffs were eating other foods (perhaps from other restaurants), were engaged in a
lifestyle that may or may not have included an appropriate physical regimen, and when their weights were
potentially influenced by a host of other factors, such as heredity, the environment, society, etc. Plaintiffs must get
over this hurdle to survive a motion to dismiss, and, as discussed infra, the Complaint fails to do so.
In order to show proximate cause, a plaintiff must establish that the defendant's conduct was a substantial cause in
bringing about the harm. (citing ); see also . "The word 'substantial' is used to denote the fact that the defendant's conduct
has such an effect in producing the harm as to lead reasonable [persons] to regard it as a cause, using that word in the
popular sense, in which there always lurks the idea of responsibility, rather than in the so-called 'philosophic sense,' which
includes every one of the great number of events without which any happening would not have occurred." , cmt. a.
Several factors are considered, including "the aggregate number of actors involved which contribute towards the harm and
the effect which each has in producing it," and "whether the situation was acted upon by other forces for which the
defendant is not responsible."
(quoting (citing )); see also ("[W]e are particularly mindful of Professor Prosser's
observation that 'no case has been found where the defendant's act could be called a substantial factor when the event would
have occurred without it.' ") (quoting W. Prosser, Handbook of the Law of Torts, § 41 at 240 (4th ed.1971) (applying New
York law)).
The issue of proximate cause may be determined as a matter of law where no reasonable person could find causation based
on the facts alleged in the complaint. E.g., (granting summary judgment where there was no causation as matter of law in
duty to warn context); (noting that question of legal cause may be decided as a matter of law where only one conclusion
may be drawn from the established facts).
No reasonable person could find probable cause based on the facts in the Complaint without resorting to "wild speculation."
(ruling on causation as matter of law as jury could find causation only by engaging in "wild speculation").
First, the Complaint does not specify how often the plaintiffs ate at McDonalds. The class action proposed by plaintiffs
could consist entirely of persons who ate at McDonalds on one occasion. As a result, any number of other factors then
potentially could have affected the plaintiffs' weight and health. In order to survive a motion to dismiss, the Complaint at a
minimum must establish that the plaintiffs ate at McDonalds on a sufficient number of occasions such that a question of
fact is raised as to whether McDonalds' products played a significant role in the plaintiffs' health problems. While the
assignment of such a frequency is beyond the competency of this Court at this time, it seems like the frequency must be
more than once per week--a figure cited by plaintiffs' counsel in oral argument as a potentially not unhealthy figure.
Naturally, the more often a plaintiff had eaten at McDonalds, the stronger the likelihood that it was the McDonalds' food (as
opposed to other foods) that affected the plaintiffs' health.
Plaintiffs have attached affidavits to their opposition papers to respond to this issue. E.g., J. Bradley Aff. at ¶ 4
("While on my way to school and during school lunch breaks, I mostly ate at McDonalds restaurants."); N. Bradley
Aff. at ¶ 5 ("I go to McDonalds once a day for breakfast for the eggs and sausages and muffins[,] and I also go for
lunch."); S. Bradley Aff. at ¶ 5 ("While on my way to school and during school lunch breaks, I mostly ate at
McDonalds restaurants."); A. Pelman Aff. at ¶ 6 ("Between the ages of five and twelve[,] I used to go to McDonalds
approximately three to four times a week."); W. Sgaglione Aff. at ¶ 6 ("Between the ages of three and twelve[,] I
ate at McDonalds three to four times a week.").
Counsel was referring to advertisements run by McDonalds restaurants in France stating that children should eat
at McDonalds at most only once a week. E.g., McD refutes own French ads, Nation's Restaurant News 3, ("The ad,
from a campaign in France that promoted McDonald's meals as a part of a balanced weekly diet, quoted a
nutritionist as saying "there's no reason to abuse fast food or visit a McDonald's more than once a week ...." "); see
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also Barbara F. Meltz, "Just Say 'Phooey' to the Food/Fun Link," Boston Globe, at H.6 (11/14/02), ("If children eat
fast food once a week, it likely will not contribute to a health problem; if they eat it three or more times a week, it
might."). McDonalds Corp. issued a statement on October 30, 2002, that the company "strongly disagreed" with the
nutritionist's advice. Restaurant News, at 3.
Second, McDonalds points out that articles on which plaintiffs rely in their Complaint suggest that a number of factors other
than diet may come into play in obesity and the health problems of which plaintiffs complain. E.g., National Institutes of
Health, Clinical Guidelines on the Identification, Evaluation, and Treatment of Overweight and Obesity in Adults, at xi, 27
(1998) (cited in Compl. at 5-6 nn. 6, 8, 13, 14) ("Obesity is a complex multifactoral chronic disease developing from
interactive influences of numerous factors--social behavioral, physiological, metabolic, cellular, and molecular" in addition to
cultural and genetic factors); The Surgeon General's Call to Action to Prevent and Decrease Overweight and Obesity, at 1
(2001) (citing in Compl. at 4-7, nn. 3, 4, 9, 15, 16) ("Overweight and obesity are caused by many factors.
For each
individual, body weight is determined by a combination of genetic metabolic, behavioral, environmental, cultural, and
socioeconomic influences.").
As a result, in order to allege that McDonalds' products were a significant factor in the plaintiffs' obesity and health
problems, the Complaint must address these other variables and, if possible, eliminate them or show that a McDiet is a
substantial factor despite these other variables. Similarly, with regard to the plaintiffs' health problems that they claim
resulted from their obesity (which they allege resulted from their McDonalds habits), it would be necessary to allege that
such diseases were not merely hereditary or caused by environmental or other factors.
Because of the possibility of the myriad factors involved in alleging proximate cause, plaintiffs may well be unable
to justify class certification. A plaintiff seeking class certification bears the burden of demonstrating that the class
satisfies the prerequisites of numerosity, (2) commonality, (3) typicality, and (4) adequacy of representation. E.g., .
Additionally, a plaintiff must demonstrate that the proposed class action fits within one of the three categories
described . E.g., . It is difficult to imagine how the typicality requirement would be satisfied, as any named
plaintiff's injuries would necessarily be a product of the particular variables surrounding the plaintiff, whether
social, environmental or genetic. In addition, it is unclear if plaintiffs can meet their obligation of showing that the
case is manageable as a class action.
E.g.,
(citing (finding "difficulties likely to be encountered in the
management of a class action" pertinent to analysis); (evaluating the "management issue")).
Because the Complaint fails to allege that the danger of the McDonalds' products were not well-known and fails to allege
with sufficient specificity that the McDonalds' products were a proximate cause of the plaintiffs' obesity and health
problems, Count III shall be dismissed.
B. Count IV: Failure to Warn of Unhealthy Attributes
Count IV alleges a failure to warn of the unhealthy attributes of McDonalds' products. While the cause of action differs
from Count III, McDonalds' arguments that this claim fails because the dangers of its fare were well-known and that
plaintiffs have failed to show proximate cause are nonetheless applicable.
In , the New York Court of Appeals summarized the current State of New York law with regard to a manufacturer's liability
for failure to warn in a products liability case:
"A manufacturer has a duty to warn against latent dangers resulting from foreseeable uses of its product of which it knew
or should have known. A manufacturer also has a duty to warn of the danger of unintended uses of a product provided
these uses are reasonably foreseeable .... [A] manufacturer may be liable for failing to warn against the dangers of
foreseeable misuse of the product .... A manufacturer's superior position to garner information and its corresponding duty
to warn is no less with respect to the ability to learn of ... misuse of a product ...."
The standard for evaluating failure to warn liability is "intensely fact-specific, including but not limited to such issues as
feasibility and difficulty of issuing warnings in the circumstances ...; obviousness of the risk from actual use of the product;
knowledge of the particular product user; and proximate cause." The factual determination of whether an adequate
warning was given is "often interwoven with the question of whether the defendant manufacturer has a duty to warn, and if
so, to whom that duty is owed." .
In duty to warn cases, New York recognizes two circumstances that would preclude a finding of proximate cause: (1)
obviousness and (2) the knowledgeable user. , vacated and reinstated, . McDonalds alleges only the former.
While the plaintiffs argue in opposition to this motion that they, as infants, cannot be "knowledgeable users," (Pls.'
Mem. at 25), McDonalds relies only on the objective open and obvious defense to support its motion. Therefore,
plaintiffs' knowledgeable users arguments will not be addressed.
The confusion of the two concepts would appear to explain some of the arguments between the parties as to whether
an objective or subjective standard should be considered. Pursuant to the "knowledgeable user" defense, proximate
cause cannot be found where the plaintiff is a knowledgeable user who is actually aware of the dangerous nature of
the product supplied. E.g., , vacated and reinstated, ; ; . The "knowledgeable user" defense thus employs a
subjective standard, while the "open and obvious" defense employs an objective standard. ; see also
(distinguishing "obvious danger" exception from "knowledgable user" exception and explaining that the latter
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requires proof of subjective knowledge).
To the extent that plaintiffs are in fact arguing that the "open and obvious" danger exception should take into
consideration the infant plaintiffs' ages and maturity, they have failed to cite case law in support of this
proposition. By contrast, McDonalds cites several cases involving underage alcohol consumption that hold that
minors should be held accountable for the same body of common knowledge of risks posed by alcohol consumption.
E.g., Robinson v. Anheuser-Busch, Inc., No. 00-D-300-N, slip op., at 6-7 (M.D.Ala.2000) ("a minor's age does not
neutralize any common knowledge about the dangers of alcohol consumption").
Pursuant to the "open and obvious" exception, a manufacturer may not be liable for a failure to warn if the risks were
sufficiently obvious to the user without a warning.
("[T]he focus of the 'obviousness' inquiry is upon the objective
reasonableness of the supplier's judgment about whether users will perceive the danger.... The danger must be so apparent
or so clearly within common knowledge that a user would appreciate the danger to the same extent that a warning would
provide.") (citations omitted).
The open and obvious defense will not apply "when there are aspects of the hazard which are concealed or not reasonably
apparent to the user ...." see also (denying summary judgment motion because as a matter of law the danger of jumping on
trampolines was not so obvious that trampoline manufacturer need not have including warnings (1) that risk-reducing cages
were available on the market and (2) that users should jump only in the center, with proper ground covering, or with
professional supervision or spotter); (finding as a matter of law that it was not obvious that injury would result to operator
who had not activated machine at all, even though it was obvious that injury could result to an operator who had activated,
either intentionally or accidentally, the machine).
Because of the difficulty in administering this test, the question of whether a danger is open and obvious is usually a jury
question unless only one conclusion may be drawn from the established facts. ("The fact- specific nature of the inquiry into
whether a particular risk is obvious renders bright-line pronouncements difficult, and in close cases it is easy to disagree
about whether a particular risk is obvious. It is hard to set a standard for obviousness that it neither under- nor overinclusive.").
As discussed above, the Complaint fails to allege that the McDonalds' products consumed by the plaintiffs were dangerous in
any way other than that which was open and obvious to a reasonable consumer. While the plaintiffs have presented the
outline of a substantial argument to the contrary in their papers, as discussed supra, their theory is not supported in their
Complaint, and thus cannot save Count IV from dismissal. In addition, as also discussed above, the Complaint does not
allege with sufficient specificity that the plaintiffs' consumption of McDonalds' products was a significant factor in their
obesity and related health problems. As a result, Count IV must be dismissed.
IV. Count V: Sale of Addictive Products
The exact basis of Count V is unclear. It appears to be a products liability claim, i.e., McDonalds' products are inherently
dangerous in that they are addictive. The claim may also be read to allege that McDonalds failed to warn its customers
that its products were addictive. This claim, unlike the one above based on unhealthy attributes, does not involve a danger
that is so open and obvious, or so commonly well-known, that McDonalds' customers would be expected to know about it. In
fact, such a hypothesis is even now the subject of current investigations. See Sarah Avery, "Is Big Fat the Next Big
Tobacco?"
Raleigh News & Observer, at A25, ("[R]esearchers are investigating whether large amounts of fat in
combination with sugar can trigger a craving similar to addiction. Such a finding would go far in explaining why fast-food
sales have climbed to more than $100 billion a year ... despite years of warnings to limit fats."). Therefore, it does not run
into the same difficulties discussed above with regard to clarifying that the unhealthy attributes are above and beyond what
is normally known about fast food.
While it is necessary to accept as true the allegation in the Complaint that McDonalds' products are addictive for the
purposes of this motion, such allegation standing alone is, nonetheless, insufficient as overly vague. The Complaint does
not specify whether it is the combination of fats and sugars in McDonalds products, id., that is addictive, or whether there is
some other additive, that works in the same manner as nicotine in cigarettes, to induce addiction. Further, there is no
allegation as to whether McDonalds purposefully manufactured products that have these addictive qualities. In addition,
the Complaint fails to specify whether a person can become addicted to McDonalds' products after eating there one time or
whether it requires a steady diet of McDonalds in order to result in addiction. There is also no allegation as to whether
plaintiffs, as infants, are more susceptible to the addiction than adults.
While some of these questions necessarily may not be answered until discovery (should this claim be replead and survive a
motion to dismiss), and likely then only with the aid of expert witnesses, to allow a complaint to survive merely because it
alleges product liability on the basis of addiction would be to allow any complaint that alleges product liability based on the
addictive nature of the products to survive dismissal, even where such addiction is likely never to be proven. As a result, a
complaint must contain some specificity in order to survive a motion to dismiss. A claim that a product causes addiction and
that reasonable consumers are unaware of that danger must at the very least (1) allege that the plaintiffs are addicted, with
allegations revealing ways in which their addiction may be observed, and (2) specify the basis of the plaintiffs' belief that
they and others became addicted to the product. Further allegations addressing questions raised above would further
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285
strengthen the claim. In the absence of any such specific allegations, Count V must be dismissed. Such showings also
suggest that plaintiffs will not be able to justify class certification. See supra note 30. In any case, as discussed above, the
Complaint fails to allege sufficiently that the addictive nature of McDonalds' food and the plaintiffs' resulting ingestion
thereof is a proximate cause of the plaintiff's health problems. As a result, Count V is dismissed.
V. Leave to Amend Is Granted.
requires that "leave [to amend] shall be freely given when justice so requires." . When a motion to dismiss is granted, "the
usual practice is to grant leave to amend the complaint." 2A Moore & Lucas, Moore's Federal Practice ¶ 12.14 at 12-99 (2d
ed.1989); see also (same rule for complaints dismissed under Rule 9(b)). Although the decision whether to grant leave to
amend is within the discretion of the district court, refusal to grant leave must be based on a valid ground.
As a result,
the plaintiffs may amend their complaint to address the deficiencies listed above.
Conclusion
For the foregoing reasons, the Complaint is dismissed in its entirely. Leave is granted to replead all claims except for those
based on New York City Administrative Code, Ch. 5, 20-700 et seq., which are dismissed with prejudice. Any amended
complaint should be filed within thirty (30) days of the issuance of this opinion.
It is so ordered.
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Case 13.4
357 F.3d 426
United States Court of Appeals,
Fourth Circuit.
Linda JOHNSON, Plaintiff-Appellee,
v.
MBNA AMERICA BANK, NA, Defendant-Appellant, and Experian Information
Solutions, Incorporated; Equifax Credit Information Services, Incorporated;
Trans Union LLC, Defendants.
No. 03-1235.
Argued: Dec. 4, 2003.
Decided: Feb. 11, 2004.
OPINION
, Chief Judge:
MBNA America Bank, N.A. (MBNA) appeals a judgment entered against it following a jury verdict in favor of Linda
Johnson in her action alleging that MBNA violated a provision of the Fair Credit Reporting Act (FCRA), see (West 1998)
(amended Dec. 4, 2003), by failing to conduct a reasonable investigation of Johnson's dispute concerning an MBNA account
appearing on her credit report. Finding no reversible error, we affirm.
I.
The account at issue, an MBNA MasterCard account, was opened in November 1987. The parties disagree regarding who
applied for this account and therefore who was legally obligated to pay amounts owed on it. It is undisputed that one of the
applicants was Edward N. Slater, whom Johnson married in March 1991. MBNA contends that Johnson was a co-applicant
with Slater, and thus a co-obligor on the account. Johnson claims, however, that she was merely an authorized user and not
a co-applicant.
In December 2000, Slater filed for bankruptcy, and MBNA promptly removed his name from the account. That same month,
MBNA contacted Johnson and informed her that she was responsible for the approximately $17,000 balance on the account.
After obtaining copies of her credit report from the three major credit reporting agencies--Experian, Equifax, and Trans
Union--Johnson disputed the MBNA account with each of the credit reporting agencies. In response, each credit reporting
agency sent to MBNA an automated consumer dispute verification (ACDV). The ACDVs that Experian and Trans Union
sent to MBNA specifically indicated that Johnson was disputing that she was a co-obligor on the account. See J.A. 278
(Experian) ("CONSUMER STATES BELONGS TO HUSBAND ONLY"); id. at 283 (Trans Union) ("WAS NEVER A SIGNER
ON ACCOUNT. WAS AN AUTHORIZED USER"). The ACDV that Equifax sent to MBNA stated that Johnson disputed the
account balance. In response to each of these ACDVs, MBNA agents reviewed the account information contained in MBNA's
computerized Customer Information System (CIS) and, based on the results of that review, notified the credit reporting
agencies that MBNA had verified that the disputed information was correct. Based on MBNA's responses to the ACDVs, the
credit reporting agencies continued reporting the MBNA account on Johnson's credit report. Johnson subsequently sued
MBNA, claiming, inter alia, that it had violated the FCRA by failing to conduct a proper investigation of her dispute. See .
A jury trial was held, and, following the presentation of Johnson's case, MBNA moved for judgment as a matter of law. That
motion was denied. After the close of the evidence, the jury found that MBNA had negligently failed to comply with the
FCRA, and it awarded Johnson $90,300 in actual damages. MBNA renewed its motion for judgment as a matter of law,
asserting that only required MBNA to conduct a cursory review of its records to verify the disputed information.
Alternatively, MBNA argued that even if it were required to conduct a reasonable investigation of Johnson's dispute, the
evidence showed that MBNA had met that obligation. The district court again denied MBNA's motion, concluding that
required MBNA to conduct a reasonable investigation and that there was sufficient evidence from which the jury could
conclude that MBNA had failed to do so.
II.
MBNA first maintains that the district court erred in ruling that requires furnishers of credit information to conduct a
reasonable investigation of consumer disputes. imposes certain duties on a creditor who has been notified by a credit
reporting agency that a consumer has disputed information furnished by that creditor:
After receiving notice pursuant to section 1681i(a)(2) of this title of a dispute with regard to the completeness or accuracy
CHAPTER 13: WARRANTIES, PRODUCT LIABILITY, AND CONSUMER LAW
287
of any information provided by a person to a consumer reporting agency, the person shall-(A) conduct an investigation with respect to the disputed information;
(B) review all relevant information provided by the consumer reporting agency ...;
(C) report the results of the investigation to the consumer reporting agency; and
(D) if the investigation finds that the information is incomplete or inaccurate, report those results to all other consumer
reporting agencies to which the person furnished the information and that compile and maintain files on consumers on a
nationwide basis.
While this appeal was pending, was amended to add a new provision imposing certain additional duties on
creditors in connection with investigations of consumer disputes. See Fair and Accurate Credit Transactions Act of ,
117 Stat.1952, 1995-96. That provision is not relevant to our resolution of this appeal. We recognize that the FCRA
applies not only to those that furnish and report consumer credit information but also to those that furnish and
report certain other types of information regarding consumers. See . Thus, consistent with other provisions of the
FCRA, uses the general terms "furnisher[ ] of information" and "consumer reporting agency." However, because of
the specific nature of this case, and for ease of reference, in this opinion we use the terms "creditor" and "credit
reporting agency." Nonetheless, our discussion of and other FCRA provisions applies equally to those who furnish
other types of consumer information.
MBNA argues that the language of , requiring furnishers of credit information to "conduct an investigation" regarding
disputed information, imposes only a minimal duty on creditors to briefly review their records to determine whether the
disputed information is correct. Stated differently, MBNA contends that this provision does not contain any qualitative
component that would allow courts or juries to assess whether the creditor's investigation was reasonable. By contrast,
Johnson asserts that requires creditors to conduct a reasonable investigation. We review this question of statutory
interpretation de novo. See .
Neither this court nor any other circuit has addressed the extent to which a creditor must investigate a consumer
dispute in order to avoid liability under . However, district courts that have considered the issue have consistently
recognized that the creditor's investigation must be a reasonable one. See ; ; ; ; ; ; .
In interpreting a statute, we must first "determine whether the language at issue has a plain and unambiguous meaning
with regard to the particular dispute in the case." . "Our inquiry must cease if the statutory language is unambiguous and
the statutory scheme is coherent and consistent." (internal quotation marks omitted). "The plainness or ambiguity of
statutory language is determined by reference to the language itself, the specific context in which that language is used, and
the broader context of the statute as a whole."
The key term at issue here, "investigation," is defined as "[a] detailed inquiry or systematic examination." Am. Heritage
Dictionary 920 (4th ed.2000); see Webster's Third New Int'l Dictionary 1189 (1981) (defining "investigation" as "a searching
inquiry"). Thus, the plain meaning of "investigation" clearly requires some degree of careful inquiry by creditors. Further,
uses the term "investigation" in the context of articulating a creditor's duties in the consumer dispute process outlined by
the FCRA. It would make little sense to conclude that, in creating a system intended to give consumers a means to dispute-and, ultimately, correct--inaccurate information on their credit reports, Congress used the term "investigation" to include
superficial, un reasonable inquiries by creditors. Cf. (interpreting analogous statute governing reinvestigations of
consumer disputes by credit reporting agencies to require reasonable investigations); (same). We therefore hold that
requires creditors, after receiving notice of a consumer dispute from a credit reporting agency, to conduct a reasonable
investigation of their records to determine whether the disputed information can be verified.
III.
MBNA next contends that even if requires creditors to conduct reasonable investigations of consumer disputes, no evidence
here supports a determination by the jury that MBNA's investigation of Johnson's dispute was unreasonable. We review
the denial of MBNA's motion for judgment as a matter of law de novo. See . We must view the evidence in the light most
favorable to Johnson, the nonmovant, and draw all reasonable inferences in her favor without weighing the evidence or
assessing the witnesses' credibility. See "The question is whether a jury, viewing the evidence in the light most favorable
to [Johnson], could have properly reached the conclusion reached by this jury." (internal quotation marks omitted). We
must reverse if a reasonable jury could only rule in favor of MBNA; if reasonable minds could differ, we must affirm. See
As explained above, MBNA was notified of the specific nature of Johnson's dispute--namely, her assertion that she was not a
co-obligor on the account. Yet MBNA's agents testified that their investigation was primarily limited to (1) confirming that
the name and address listed on the ACDVs were the same as the name and address contained in the CIS, and (2) noting
that the CIS contained a code indicating that Johnson was the sole responsible party on the account. The MBNA agents
also testified that, in investigating consumer disputes generally, they do not look beyond the information contained in the
CIS and never consult underlying documents such as account applications. Based on this evidence, a jury could reasonably
conclude that MBNA acted unreasonably in failing to verify the accuracy of the information contained in the CIS.
Under MBNA's procedures, agents are only required to confirm two out of four pieces of information contained in
the CIS--name, address, social security number, and date of birth--in order to verify an account holder's identity.
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Johnson's social security number and date of birth were not listed on the CIS summary screen.
MBNA argues that other information contained in the CIS compels the conclusion that its investigation was reasonable.
For example, in support of its alleged belief that Johnson was a co-applicant, MBNA presented evidence that Johnson's last
name had been changed on the account following her marriage to Slater and that Johnson's name was listed on the billing
statements. But this evidence is equally consistent with Johnson's contention that she was only an authorized user on
Slater's account and that, to the extent MBNA's records listed her as a co-obligor, those records were incorrect. MBNA also
points to evidence indicating that, during her conversations with MBNA following Slater's bankruptcy filing, Johnson
attempted to set up a reduced payment plan and changed the address on the account to her business address. However, a
jury could reasonably conclude that this evidence showed only that Johnson had tried to make payment arrangements even
though she had no legal obligation to do so. Indeed, Johnson testified that, during her conversations with MBNA, she had
consistently maintained that she was not responsible for paying the account. Additionally, MBNA argues that Johnson
failed to establish that MBNA's allegedly inadequate investigation was the proximate cause of her damages because there
were no other records MBNA could have examined that would have changed the results of its investigation. In particular,
MBNA relies on testimony that, pursuant to its five-year document retention policy, the original account application was no
longer in MBNA's possession. Even accepting this testimony, however, a jury could reasonably conclude that if the MBNA
agents had investigated the matter further and determined that MBNA no longer had the application, they could have at
least informed the credit reporting agencies that MBNA could not conclusively verify that Johnson was a co-obligor.See
(West 1998) (providing that if disputed information "cannot be verified, the consumer reporting agency shall promptly delete
that item of information from the consumer's file or modify that item of information, as appropriate, based on the results of
the reinvestigation") (amended Dec. 4, 2003).
Because we conclude there is sufficient evidence to support a jury finding that MBNA failed to conduct a reasonable
investigation of Johnson's dispute, we do not consider Johnson's argument that the judgment should be affirmed on
the alternative ground that MBNA failed to "report the results of the investigation to the consumer reporting
agenc[ies]," .
IV.
MBNA next asserts that the district court improperly instructed the jury regarding the standards for determining liability.
We review challenges to jury instructions for abuse of discretion. See . "Instructions are adequate if construed as a whole,
and in light of the whole record, they adequately inform the jury of the controlling legal principles without misleading or
confusing the jury to the prejudice of the objecting party." (internal quotation marks & alterations omitted). Even if we
conclude that the challenged instructions are erroneous, we will not reverse "unless the error seriously prejudiced the
challenging party's case."
A.
MBNA first argues that the district court erred in instructing the jury that, in determining whether MBNA's investigation
was reasonable, it should consider "the cost of verifying the accuracy of the information versus the possible harm of
reporting inaccurate information." J.A. 767-68. MBNA apparently contends that the balancing test described in this
instruction is inapplicable here because it is derived from cases involving the reasonableness of a credit reporting agency's
reinvestigation, see, e.g., ; . We recognize that creditors and credit reporting agencies have different roles and duties in
investigating consumer disputes under the FCRA. Nevertheless, we believe that the general balancing test articulated by
the district court--weighing the cost of verifying disputed information against the possible harm to the consumer--logically
applies in determining whether the steps taken (and not taken) by a creditor in investigating a dispute constitute a
reasonable investigation. The district court therefore did not abuse its discretion in giving this instruction.
B.
MBNA also contends that, after instructing the jury that the FCRA "does not require that credit card account records,
including original applications, be kept in any particular form," J.A. 770, the district court erred in further instructing the
jury that "the law does prohibit MBNA from maintaining its record[s] in such manner as to consciously avoid knowing that
information it is reporting is [in]accurate," id. MBNA claims that this instruction improperly permitted the jury to assess
the adequacy of MBNA's record keeping system. However, the other detailed instructions given by the district court made
clear that Johnson's claim was based on MBNA's failure to conduct a reasonable investigation of its records, not on the
inadequacy of those records. And, it appears that the brief instruction challenged by MBNA, which the district court gave
near the end of its jury instructions, was simply intended to clarify the legal effect of MBNA not maintaining the original
account application--not to invite the jury to independently assess MBNA's record keeping practices. MBNA further claims
that the challenged instruction improperly incorporated a legal standard from another provision of , relating to the accuracy
of information that creditors provide to credit reporting agencies. See (West 1998) (prohibiting creditors from furnishing
consumer information to a credit reporting agency "if the [creditor] knows or consciously avoids knowing that the
information is inaccurate") (amended Dec. 4, 2003). MBNA emphasizes that this provision is enforceable only by
government agencies and officials, not by consumers. See (West 1998) (amended Dec. 4, 2003). Again, however, the
extensive instructions by the district court made clear that Johnson's claim was based on MBNA's duty to investigate
CHAPTER 13: WARRANTIES, PRODUCT LIABILITY, AND CONSUMER LAW
289
consumer disputes, not its duty to provide accurate information. Indeed, the district court instructed the jury that the
damages recoverable by Johnson "may not include any damages that were caused by the inaccuracy of the information
itself." J.A. 768. We therefore conclude that the instruction given by the district court did not mislead the jury or otherwise
prejudice MBNA.
V.
For the reasons set forth above, we affirm the judgment of the district court.
AFFIRMED
Supplemental Case Printout
for: Adapting the Law to the
Online Environment
300 F.3d 683, 169 Ed. Law Rep. 30, Prod.Liab.Rep. (CCH) P 16,386, 30 Media L. Rep. 2185,
2002 Fed.App. 0270P
United States Court of Appeals,
Sixth Circuit.
Joe JAMES, et al., Plaintiffs-Appellants,
v.
MEOW MEDIA, INC., et al., Defendants-Appellees.
No. 00-5922.
Argued: Nov. 28, 2001.
Decided and Filed: Aug. 13, 2002.
OPINION
, Circuit Judge.
On December 1, 1997, Michael Carneal walked into the lobby of Heath High School in Paducah, Kentucky, and shot several
of his fellow students, killing three and wounding many others. The parents and estate administrators of Carneal's victims-Jessica James, Kayce Steger, and Nicole Hadley--(hereinafter collectively referred to as "James") appeal the judgment of
the district court dismissing, for failing to state claims on which relief could be granted, their actions against several video
game, movie production, and internet content- provider firms. According to James's complaint, Carneal regularly played
video games, watched movies, and viewed internet sites produced by the defendant firms. These activities, James argues,
"desensitized" Carneal to violence and "caused" him to kill the students of Heath High School. James claims that the
distribution of this material to impressionable youth like Carneal constitutes actionable negligence under Kentucky law,
entitling James to recover wrongful death damages from the distributing firms.
Moreover, James contends that the
defendant firms purveyed defective "products," namely the content of video games, movies, and internet sites, triggering
strict product liability under Kentucky law.
The defendant firms argue that they owe no duty to protect third parties from how players, watchers or viewers process the
ideas and images presented in their video games, movies, and internet sites. Specifically, the defendants contend that
Carneal's actions were not sufficiently foreseeable to trigger the defendants' liability. Even if they were to owe such a duty
to protect third parties from the consumers of their ideas and images, the defendants argue that Carneal's independent
decision to kill his fellow students constitutes a superseding cause of the claimed damages and defeats the proximate cause
element of James's prima facie case. The defendants further contend that tort liability for the non-defamatory ideas and
images communicated in their respective media would raise significant First Amendment questions that ought to be
avoided.
Finally, the defendants note that James's theory of product liability is flawed as they have not distributed
"products" under Kentucky law.
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For the reasons set forth below, we affirm the district court's dismissal of James's actions.
I
On December 1, 1997, Michael Carneal brought a .22-caliber pistol and five shotguns into the lobby of Heath High School in
Paducah, Kentucky. At the time, Carneal was a 14-year-old freshman student at the school. Upon his arrival, Carneal
began shooting into a crowd of students, wounding five. His shots killed an additional three: Jessica James, Kayce Steger,
and Nicole Hadley. Carneal was arrested and convicted of murdering James, Steger, and Hadley.
Subsequent investigations revealed that Carneal regularly played "Doom," "Quake," "Castle Wolfenstein," "Redneck
Rampage," "Nightmare Creatures," "Mech Warrior," "Resident Evil," and "Final Fantasy," which are interactive computer
games that, in various ways, all involve the player shooting virtual opponents. Carneal also possessed a video tape
containing the movie, "The Basketball Diaries," in a few minutes of which the high-school-student protagonist dreams of
killing his teacher and several of his fellow classmates. Investigators examined Carneal's computer and discovered that he
had visited "www.persiankitty.com," which appears to catalogue and link to sites with sexually-suggestive material. It also
appeared that through "www.adultkey.com," www.adultkey.com, a site operated by Network Authentication Systems and
designed to restrict access to certain websites to viewers over certain ages, Carneal was granted age verification sufficient to
visit many other pornographic sites.
The parents, who also are the estate administrators, of James, Steger, and Hadley filed this action in the United States
District Court for the Western District of Kentucky. James's complaint named as defendants the companies that produce or
maintain the above-mentioned movie, video games, and internet sites. James stated essentially three causes of action
against the defendants. First, James alleged that the defendants had been negligent in that they either knew or should
have known that the distribution of their material to Carneal and other young people created an unreasonable risk of harm
to others. James alleged that exposure to the defendants' material made young people insensitive to violence and more
likely to commit violent acts. But for Carneal's steady diet of the defendants' material, James contended, Carneal would
not have committed his violent acts. Second, James asserted that the video game cartridges, movie cassettes, and internet
transmissions that the defendants produced and distributed were "products" for purposes of Kentucky product liability law.
According to James, the violent features of the movie, games, and internet sites were product defects. The defendants, as
producers and distributors of the "products," are strictly liable under Kentucky law for damages caused by such product
defects. The third claim that James raised was that some of the defendants' conduct had violated the Racketeer Influenced
and Corrupt Organizations Act, et seq. According to James, the defendant firms that maintained internet sites engaged in a
pattern of racketeering activity by distributing obscene material to minors. The defendants moved to dismiss all of James's
actions for failing to state any claim on which relief could be granted. See . The district court granted the defendants'
motion. The district court held that Carneal's actions were not sufficiently foreseeable to impose a duty of reasonable care
on the defendants with regard to Carneal's victims. Alternatively, the district court held that even if such a duty existed,
Carneal's actions constituted a superseding cause of the victims' injuries, defeating the element of proximate causation
notwithstanding the defendants' negligence. With regard to James's second cause of action, the district court determined
that the "thoughts, ideas and images" purveyed by the defendants' movie, video games, and internet sites were not
"products" for purposes of Kentucky law and therefore the defendants could not be held strictly liable for any alleged defects.
Finally, the district court held that James had not stated a viable RICO claim against the defendant internet firms. Among
other reasons, the district court explained that James had alleged RICO predicate acts, but had failed to identify an
organization that had been corrupted, and had failed to show any injury to "business or property" as required for standing
under RICO.
James now appeals the district court dismissal of his negligence and product liability claims. We can discern no argument
in James's brief assigning error to the district court's dismissal of his RICO claim, and therefore consider such an argument
waived. Accordingly, this appeal raises questions of only Kentucky law.
II
In this case, we review a district court's dismissal of a case for failure to state a claim on which relief may be granted. . In
deciding a motion to dismiss, the district court is required to assume that all allegations in the complaint are true and to
decide whether those allegations provide a basis for legal relief. See . "A complaint should not be dismissed for failure to
state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would
entitle him to relief." . This court reviews de novo a district court's granting of such a motion to dismiss. .
The legal questions under review in this case are questions of Kentucky law. When faced with the resolution of these state
law issues, our inquiry is in part hypothetical. Specifically, we are charged to decide these questions of Kentucky state law
as Kentucky state courts would. See . Although we can find no decision of Kentucky courts that decides precisely the
issues presented in this case, we are confident that Kentucky appellate courts would uphold the dismissal of James's action,
based on their existing decisions. We elaborate on our conclusion below, considering first James's negligence action and
second his products liability action.
III
James contends that the defendants in this case acted negligently, perhaps in producing, but at least in distributing to
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young people, their materials. It was this negligence, according to James, that caused Carneal to undertake his violent
actions and that thereby caused the deaths of the plaintiffs' daughters. In order to establish an actionable tort under
Kentucky law, the plaintiff must establish that the defendant owed a duty of care to the plaintiff, that the defendant
breached that duty of care, and that the defendant's breach was the proximate cause of the plaintiff's damages.
A. The Existence of a Duty of Care
The district court held that James's allegations, even if assumed to be true, failed to establish the first element of the prima
facie case. Specifically, the district court determined that the defendants were under no duty to protect James, Steger, and
Hadley from Carneal's actions. James argues that the district court erred as a matter of Kentucky law in this regard.
The "existence of a duty of care" as an element of a tort cause of action is of relatively recent vintage. At early English
common law, the existence of a duty of care was not considered as an element of an actionable tort. Then, tort law attached
strict liability for any damages that resulted from "wrongful acts." Prosser on Torts § 53. The requirement that the
plaintiff establish that he was owed a specific duty of care by the defendant came with the advent of negligence in place of
strict liability. See generally Percy H. Winfield, Duty in Tortious Negligence, 34 Colum. L.Rev. 41 (1934). As a separate
basis of liability, negligence was simply too broad, according to later English courts. Accordingly, the concept of limited
duty disciplined the concept of negligence, requiring the plaintiff to establish a definite legal obligation.
At first, the limited duty of care concerned the persons to whom a defendant owed an obligation of care. See, e.g., (holding
that a police officer owed no duty to protect a citizen who was killed by a drunk driver that the officer had stopped, but
released). The dilemma was that it became nearly impossible categorically to demarcate the universe of people to whom a
person would owe a duty to abstain from negligence. With regard to the existence of duty between specific persons, the
answer always was dependent on the circumstances. Kentucky courts resolved this dilemma by establishing a "universal
duty of care." ; ; . Under the universal duty of care, "every person owes a duty to every other person to exercise ordinary
care in his activities to prevent foreseeable injury."
James argues that Kentucky's universal duty of care would foreclose
the defendants' argument that they had no duty to protect James, Steger, and Hadley. It is clear to us, however, that
Kentucky's rule of a universal duty of care simply recognizes the obvious in determining the existence of a duty of care. Of
course, there are conceivable circumstances under which there would be legally enforceable duties to act without negligence
between any two people. What Kentucky courts have recognized through the "universal duty of care" rule is that the
existence of a duty of care is circumstantially limited: the duty is to exercise ordinary care to prevent foreseeable harm.
Thus, Kentucky courts have held that the determination of whether a duty of care exists is whether the harm to the plaintiff
resulting from the defendant's negligence was "foreseeable." Foreseeability is an often invoked, but not terribly well
defined, concept in the common law of tort.
Some common law tort regimes use foreseeability as the standard for
determining proximate causation. See, e.g., ; . Compare (attempting to identify different forms of foreseeability for the
proximate cause and the existence of a duty inquiries). Kentucky's particular use of foreseeability in the duty inquiry finds
its roots in perhaps the most famous application of the foreseeability principle. In , then-Judge Cardozo determined that
the defendant's duty is to avoid "risks reasonably to be perceived."
As every former law student remembers, the plaintiff
in had bought a train ticket to travel to the Rockaways for the afternoon and was waiting on the station platform. Two
men were rushing to catch a departing train, one easily hopped on board and the other struggled to pull himself onto the
rear car. A conductor on the train pulled him on board, but in the process, the struggling passenger dropped onto the rails
the brown-paper package he was carrying. The package was full of fireworks and exploded. The explosion overturned a
large set of scales on the platform, which struck Palsgraf, and Palsgraf sued the railroad for her injuries.
Cardozo determined that the railroad simply did not owe a duty to Palsgraf to protect against the injury that she suffered.
For Cardozo, the harm that Palsgraf suffered was not sufficiently probable that the railroad employees could have been
expected to anticipate it occurring from their actions.
Cardozo's reasoning, although implying that Palsgraf was the
unforeseeable plaintiff, rested on the improbability of the harm that she suffered arising from the defendant's particular
actions. For Cardozo too, the existence of a duty of care was a creature of circumstance.
Cardozo's opinion in while cited as the cornerstone of the American doctrine of a limited duty of care, has been criticized for
its conclusory reasoning regarding whether Palsgraf's harm really was sufficiently unforeseeable. See William L. Prosser,
Palsgraf Revisited, 52 Mich. L.Rev. 1, 7-9 (1953). Such conclusory reasoning has been endemic in the jurisprudence of
determining duty by assessing foreseeability. Courts often end up merely listing factual reasons why a particular harm,
although having materialized, would have appeared particularly unlikely in advance and then simply asserting that the
harm was too unlikely to be foreseeable and to create a duty to exercise due care in protecting against it. What has not
emerged is any clear standard regarding what makes a projected harm too improbable to be foreseeable.
Kentucky courts have struggled with the formless nature of this inquiry. At bottom, Kentucky courts have conceded,
deciding the existence of a duty of care is "essentially a policy determination." ; . Rather than the sophisticated weighing
of probabilities, the content of that policy determination "is but a conclusion of whether a plaintiff's interests are entitled to
legal protection against the defendant's conduct." .
The parties in this case have argued at length over whether the foreseeability inquiry required to determine the existence of
a duty of care is a pure question of law for the court or a question of fact that should generally be submitted to a jury.
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Under Kentucky law, it is clear that the existence of a duty of care to the plaintiff, and its underlying foreseeability inquiry,
is a pure question of law for the court. ("The question of duty presents an issue of law");
See also (listing other
jurisdictions in which the duty inquiry is a question of law). The allocation of responsibility for determining this question to
the courts, rather than to juries, reveals that the duty inquiry contains an important role for considering the policy
consequences of imposing liability on a certain class of situations. Essentially, the foreseeability inquiry requires courts to
determine questions inexorably tied to the ultimate question of whether the defendant was negligent. After all, the
probability of the harm is a significant factor in traditional assessment of negligence. By placing the foreseeability analysis
in the hands of courts, the existence of duty element of the prima facie case serves as a gatekeeper for the otherwise
extremely broad concept of negligence.
James directs us to several cases that, he argues, stand for the proposition that foreseeability of harm is a question
of fact for the jury under Kentucky law, when reasonable minds can differ. Most of the cited cases, however,
pertain to the question of foreseeability in the context of proximate causation. ("The question of foreseeable risk is
covered by the usual instruction relating to proximate cause."). Proximate cause, and its underlying foreseeability
inquiry, is a question of fact for the jury. See Part III.B. infra. The only other Kentucky case cited for this
proposition has nothing to do with the common law of tort. See (discussing the concept of reasonably foreseeable
reliance in a breach of contract case). James also directs us to , which holds that foreseeability for determining the
existence of a duty is a question of fact for the jury.
The federal district court in however, erred in its
interpretation of Kentucky law on this issue, and we choose to follow the clear rulings of the Kentucky courts in
and
Learned Hand's famous conception of negligence would hold conduct negligent if the harm that the conduct
threatens to create, discounted by the ex ante probability of the harm's non-occurrence, outweighs the utility created
by the conduct. See .
Thus, we are called, as best we can, to implement Kentucky's duty of care analysis in this case. Our inquiry is whether the
deaths of James, Steger, and Hadley were the reasonably foreseeable result of the defendants' creation and distribution of
their games, movie, and internet sites. Whether an event was reasonably foreseeable is not for us to determine with the
assistance of hindsight. . The mere fact that the risk may have materialized does little to resolve the foreseeability question.
Kentucky courts, in resolving foreseeability questions, have consistently inquired into the relative likelihood of the injuries
produced. Of particular interest in this case are cases in which plaintiffs have sought to hold defendants liable for the
actions of third parties, allegedly enabled or encouraged by the defendants. A line of cases in this vein concerns dram
shops.
In the Kentucky Supreme Court held that an automobile accident injuring third parties was a reasonably
foreseeable result of the negligent act of serving alcohol to an intoxicated individual.
In contrast, the court later held that
an intoxicated patron fighting with and shooting a fellow customer was simply not a foreseeable result of continuing to serve
the patron alcohol. . According to the court, the violent fighting and shooting was so much less likely a result from the
serving of alcohol than the negligent operation of a motor vehicle that it was not reasonably foreseeable. Accordingly, the
court held that dram shops, although negligent in serving alcohol to the obviously intoxicated, do not have a duty to protect
third parties from the intentional violent acts of their intoxicated patrons.
Intentional violence is less likely to result from intoxication than negligent operation of a motor vehicle. Yet, the Kentucky
Supreme Court never makes clear how unlikely is too unlikely for a particular type of harm to be unforeseeable. The cases
do not create a principle, portable to the context of this case, for evaluating the probability of harm.
This court has encountered this foreseeability inquiry under Kentucky law before in a situation similar to this case. In , the
mother of a suicide victim sued TSR for manufacturing the game "Dungeons and Dragons." The suicide victim regularly
played the game. The mother contended that the game's violent content "desensitized" the victim to violence and caused
him to undertake the violent act of shooting himself in the head.
We held that the boy's suicide was simply not a
reasonably foreseeable result of producing the game, notwithstanding its violent content. To have held otherwise would
have been "to stretch the concepts of foreseeability and ordinary care to lengths that would deprive them of all normal
meaning."
Foreseeability, however, is a slippery concept. Indeed, it could be argued that we ourselves confused it with some concept of
negligence.
We noted in
"The defendant cannot be faulted, obviously, for putting its game on the market without
attempting to ascertain the mental condition of each and every prospective player." We almost appeared to say that the
costs of acquiring such knowledge would so outweigh the social benefits that it would not be negligent to abstain from such
an investigation. We can put the foreseeability point a little more precisely, however. It appears simply impossible to
predict that these games, movie, and internet sites (alone, or in what combinations) would incite a young person to violence.
Carneal's reaction to the games and movies at issue here, assuming that his violent actions were such a reaction, was
simply too idiosyncratic to expect the defendants to have anticipated it. We find that it is simply too far a leap from
shooting characters on a video screen (an activity undertaken by millions) to shooting people in a classroom (an activity
undertaken by a handful, at most) for Carneal's actions to have been reasonably foreseeable to the manufacturers of the
media that Carneal played and viewed.
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At first glance, our conclusion also appears to be little more than an assertion. Mental health experts could quite plausibly
opine about the manner in which violent movies and video games affect viewer behavior. We need not stretch to imagine
some mixture of impressionability and emotional instability that might unnaturally react with the violent content of the
"Basketball Diaries" or "Doom." Of course, Carneal's reaction was not a normal reaction. Indeed, Carneal is not a normal
person, but it is not utter craziness to predict that someone like Carneal is out there.
We return, however, to the Kentucky court's observation that the existence of a duty of care reflects a judicial policy
judgment at bottom. From the Kentucky cases on foreseeability, we can discern two relevant policies that counsel against
finding that Carneal's violent actions were the reasonably foreseeable result of defendants' distribution of games, movies,
and internet material.
1. The Duty to Protect Against Intentional Criminal Actions
First, courts have held that, except under extraordinary circumstances, individuals are generally entitled to assume that
third parties will not commit intentional criminal acts. See , cmt. d ("Normally the actor has much less reason to anticipate
intentional misconduct than he has to anticipate negligence. In the ordinary case he may reasonably proceed upon the
assumption that others will not interfere in a manner intended to cause harm to anyone. This is true particularly where
the intentional conduct is a crime, since under ordinary circumstances it may reasonably be assumed that no one will violate
the criminal law."). See also (holding that fertilizer and blasting cap manufacturers were not liable for Murrah Federal
Building bombing, as they were entitled to believe that third parties would not engage in intentional criminal conduct); .
The reasons behind this general rule are simple enough. The first reason is a probabilistic judgment that foreseeability
analysis requires. Individuals generally are significantly deterred from undertaking intentional criminal conduct given the
sanctions that can follow. The threatened sanctions make the third-party intentional criminal conduct sufficiently less
likely that, under normal circumstances, we do not require the putative tort defendant to anticipate it. Indeed, this
statistical observation explains the distinction drawn by Kentucky courts in the dram shop liability cases. The second
reason is structural. The system of criminal liability has concentrated responsibility for an intentional criminal act in the
primary actor, his accomplices, and his co-conspirators. By imposing liability on those who did not endeavor to accomplish
the intentional criminal undertaking, tort liability would diminish the responsibility placed on the criminal defendant. The
normative message of tort law in these situations would be that the defendant is not entirely responsible for his intentional
criminal act. Does this case involve the extraordinary circumstances under which we would require the defendants to
anticipate a third party's intentional criminal act? Kentucky courts have found such circumstances when the tort defendant
had previously developed "a special relationship" with the victim of a third-party intentional criminal act.
See, e.g.,
(requiring that the victim be in state custody in order to trigger governmental duty to protect her from third-party violence
as a matter of Kentucky tort law). Cf. (articulating the special relationship test to trigger a governmental duty to protect
persons from private violence under the Fourteenth Amendment). This duty to protect can be triggered by placing the
putative plaintiff in custody or by taking other affirmative steps that disable the plaintiff from protecting himself against
third-party intentional criminal acts. Of course, a special relationship can be created by a contract between the plaintiff
and the defendant. Finally, some states have imposed a duty to protect others from third-party intentional criminal acts on
members of discrete professions who become aware of the third-party's intention to engage in criminal conduct against a
specific person. See ; .
We can find nothing close to a "special relationship" in this case. The defendants did not even know James, Steger, and
Hadley prior to Carneal's actions, much less take any affirmative steps that disabled them from protecting themselves.
Courts have held, under extremely limited circumstances, that individuals, notwithstanding their relationship with the
victims of third-party violence, can be liable when their affirmative actions "create a high degree of risk of [the third party's]
intentional misconduct." Restatement of Torts (Second) , cmt. e.H. Generally, such circumstances are limited to cases in
which the defendant has given a young child access to ultra-hazardous materials such as blasting caps, , or firearms. .
Even in those cases, courts have relied on the third party's severely diminished capacity to handle the ultra-hazardous
materials. With older third parties, courts have found liability only where defendants have vested a particular person,
under circumstances that made his nefarious plans clear, with the tools that he then quickly used to commit the criminal
act.
See .
Arguably, the defendants' games, movie, and internet sites gave Carneal the ideas and emotions, the
"psychological tools," to commit three murders. However, this case lacks such crucial features of our jurisprudence in this
area. First, the defendants in this case had no idea Carneal even existed, much less the particular idiosyncracies of
Carneal that made their products particularly dangerous in his hands. In every case that this court has discovered in which
defendants have been held liable for negligently creating an unreasonably high risk of third-party criminal conduct, the
defendants have been specifically aware of the peculiar tendency of a particular person to commit a criminal act with the
defendants' materials.
Second, no court has ever held that ideas and images can constitute the tools for a criminal act under this narrow exception.
Beyond their intangibility, such ideas and images are at least one step removed from the implements that can be used in the
criminal act itself. In the cases supporting this exception, the item that the defendant has given to the third- party criminal
actor has been the direct instrument of harm.
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2. First Amendment Problems
Moreover, we are loath to hold that ideas and images can constitute the tools for a criminal act under this exception, or even
to attach tort liability to the dissemination of ideas. We agree with the district court that attaching tort liability to the
effect that such ideas have on a criminal actor would raise significant constitutional problems under the First Amendment
that ought to be avoided. See (suggesting that non- constitutional questions of law ought to be construed, where possible,
to avoid significant constitutional problems). Although the plaintiffs' contentions in this case do not concern the absolute
proscription of the defendants' conduct, courts have made clear that attaching tort liability to protected speech can violate
the First Amendment. See ("Although this is a civil lawsuit between private parties, the Alabama courts have applied a
state rule of law which petitioners claim to impose invalid restrictions on their constitutional freedoms of speech and press.
It matters not that that law has been applied in a civil action and that it is common law only, though supplemented by
statute.").
The first inquiry is whether the defendants' activity constitutes protected speech under the First Amendment. One thing is
perfectly clear to this court: the plaintiffs' argument does not seek to attach liability to the cassettes and cartridges
distributed by the defendants, but the ideas and images communicated to Carneal by those products.
Although the
defendants' products may be a mixture of expressive and inert content, the plaintiffs' theory of liability isolates the
expressive content of the defendants' products. Expression, to be constitutionally protected, need not constitute the
reasoned discussion of the public affairs, but may also be for purposes of entertainment. See . Clearly, the various media
distributed in this case fall along a spectrum of expressive content. It is long settled that movies can constitute protected
speech. . Of more recent, but no less definitive, resolution is that internet sites are similarly entitled to protection. See
(striking down the Communications Decency Act regulating indecent material on the internet). The constitutional status of
video games has been less litigated in federal courts. Yet most federal courts to consider the issue have found video games
to be constitutionally protected. (Posner, J.); ; . But see (holding that video games were not protected expression under
the First Amendment).
Extending First Amendment protection to video games certainly presents some thorny issues. After all, there are features
of video games which are not terribly communicative, such as the manner in which the player controls the game. The
plaintiffs in this case, however, complain about none of those non- expressive features. Instead, they argue that the video
game, somehow, communicated to Carneal a disregard for human life and an endorsement of violence that persuaded him to
commit three murders. Because the plaintiffs seek to attach tort liability to the communicative aspect of the video games
produced by the defendants, we have little difficulty in holding that the First Amendment protects video games in the sense
uniquely relevant to this lawsuit. Our decision here today should not be interpreted as a broad holding on the protected
status of video games, but as a recognition of the particular manner in which James seeks to regulate them through tort
liability. To say that the features of the defendants' products of which the plaintiffs complain are protected by the First
Amendment is not necessarily to say that attaching tort liability to those features raises significant constitutional problems.
The plaintiffs' argument is more nuanced: they do not seek to hold the defendants responsible merely for distributing their
materials to anyone, but to young, impressionable children or, even more specifically, to Carneal. The protections of the
First Amendment have always adapted to the audience intended for the speech. Specifically, we have recognized certain
speech, while fully protected when directed to adults, may be restricted when directed towards minors. See, e.g., ; . We
have also required, however, that such regulations be narrowly tailored to protecting minors from speech that may
improperly influence them and not effect an "unnecessarily broad suppression of speech" appropriate for adults. ; ; .
Of course, the measure here intended to protect minors from the improper influence of otherwise protected speech is quite
different from the regulations that we have countenanced in the past. Those regulations were the product of the reasoned
deliberation of democratically elected legislative bodies, or at least regulatory agencies exercising authority delegated by
such bodies. It was legislative bodies that had demarcated what otherwise protected speech was inappropriate for children
and that had outlined in advance the measures that speakers were required to take in order to protect children from the
speech. In contrast, the question before us is whether to permit tort liability for protected speech that was not sufficiently
prevented from reaching minors. At trial, the plaintiff would undoubtedly argue about the efficient measures that the
defendants should have taken to protect the children. But at the end of this process, it would be impossible for reviewing
courts to evaluate whether the proposed protective measures would be narrowly tailored regulations. Who would know
what omission the jury relied upon to find the defendants negligent? Moreover, under the concept of negligence, there is no
room for evaluating the value of the speech itself. The question before a jury evaluating James's claim of negligence would
ask whether the defendants took efficient precautions, in keeping their material from Carneal, that would be less expensive
than the amount of the loss, the three deaths.
We cannot adequately exercise our responsibilities to evaluate regulations of protected speech, even those designed for the
protection of children, that are imposed pursuant to a trial for tort liability. Crucial to the safeguard of strict scrutiny is
that we have a clear limitation, articulated in the legislative statute or an administrative regulation, to evaluate. "Whither
our children,"as Appellant's brief states at 3, is an important question, but their guidance through the regulation of
protected speech should be directed in the first instance to the legislative and executive branches of state and federal
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governments, not the courts.
Our concerns about adequately evaluating the narrow tailoring of regulations wane if the underlying expression is
completely unprotected. Whether certain speech is not protected at all is a question that courts are regularly called upon to
answer. James argues that to the extent that the content distributed by the defendants is at all expressive, it constitutes
obscene material that is unprotected by the First Amendment. See . It would be novel to argue that the video games and
The Basketball Diaries are obscene. As we understand James's complaint, he complains that the video games and the
movie are excessively violent--yet we have generally applied our obscenity jurisprudence only to material of a sexual nature,
appealing only to prurient interest and lacking any other socially redeeming value. See ("We now confine the scope of
[obscene material] to works which depict or describe sexual conduct."); (holding that because depictions of violence are not
sexual, obscenity jurisprudence does not apply).
With the sexually-oriented internet defendants, James has an arguable basis to allege that the material is unprotected
speech under our conventional obscenity jurisprudence. Nevertheless, where the First Amendment concerns wane the most
with the possibility of obscenity, the foreseeability problems loom the largest. In his complaint, James contends that the
sexual content displayed by the internet sites made "virtual sex pleasurable and attractive" for Carneal and caused him to
undertake his violent actions. To us, however, James's allegations regarding his exposure to violence seem much closer to
the mark. After all, James does not seek to hold the internet defendants responsible for a sexual crime: Carneal never
endeavored sexually to abuse his victims, just to kill them.
With the movie and video game defendants, James contends that their material is excessively violent and constitutes
obscene, non-protected speech. We decline to extend our obscenity jurisprudence to violent, instead of sexually explicit,
material. Even if we were to consider such an expansion, James's arguments are not conceptually linked to our obscenity
jurisprudence. The concept of obscenity was designed to permit the regulation of "offensive" material, that is, material that
people find "disgusting" or "degrading." See . James's argument, on the other hand, is that the violent content of these
video games and the movie shapes behavior and causes its consumers to commit violent acts. This is a different claim than
the obscenity doctrine, which is a limit on the extent to which the community's sensibilities can be shocked by speech, not a
protection against the behavior that the speech creates. (holding that the law of obscenity does not apply to the argument
that violence in video games causes players to commit violent acts).
This is not to say that protecting people from the violence that speech might incite is a completely impermissible purpose for
regulating speech. However, we have generally handled that endeavor under a different category of our First Amendment
jurisprudence, excluding from constitutional protection those communicated ideas and images that incite others to violence.
Speech that falls within this category of incitement is not entitled to First Amendment protection. See . The Court firmly
set out the test for whether speech constitutes unprotected incitement to violence in . In protecting against the propensity
of expression to cause violence, states may only regulate that speech which is "directed to inciting or producing imminent
lawless action and is likely to incite or produce such action." (emphasis added).
The violent material in the video games and The Basketball Diaries falls well short of this threshold. First, while the
defendants in this case may not have exercised exquisite care regarding the persuasive power of the violent material that
they disseminated, they certainly did not "intend" to produce violent actions by the consumers, as is required by the test.
(requiring evidence that the speaker "intended" his words to produce violent conduct under the test). Second, the threat of
a person like Carneal reacting to the violent content of the defendants' media was not "imminent." Even the theory of
causation in this case is that persistent exposure to the defendants' media gradually undermined Carneal's moral discomfort
with violence to the point that he solved his social disputes with a gun. This glacial process of personality development is
far from the temporal imminence that we have required to satisfy the test. ( "The mere tendency of speech to encourage
unlawful acts is not a sufficient reason for banning it absent some showing of a direct connection between the speech and
imminent illegal conduct."); (holding that incitement is not imminent if it risks third- party violence at some "indefinite
future time"). Third, it is a long leap from the proposition that Carneal's actions were foreseeable to the requirement that
the violent content was "likely" to cause Carneal to behave this way.
James contends that the test for speech inciting violence does not apply to depictions of violence, but instead only to
political discourse advocating imminent violence. James suggests that the suppression of expression that is not advocacy,
but does tend to inspire violence in its viewers or consumers, is governed by a less stringent standard. Federal courts,
however, have generally demanded that all expression, advocacy or not, meet the test before its regulation for its tendency
to incite violence is permitted. See (applying the test to arguments that pornography causes viewers to engage in conduct
that is violent and degrading to women); (rejecting suggestion "that a less stringent standard than the test be applied in
cases involving non-political speech that has actually produced harm.").
Like the district court, we withhold resolution of these constitutional questions given the adequacy of the state law grounds
for upholding the dismissal. Attaching such tort liability to the ideas and images conveyed by the video games, the movie,
and the internet sites, however, raises grave constitutional concerns that provide yet an additional policy reason not to
impose a duty of care between the defendants and the victims in this case.
B. Proximate Causation
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Even if this court were to find that the defendants owed a duty to protect James, Steger, and Hadley from Carneal's violent
actions, the plaintiffs likely have not alleged sufficient facts to establish the third element of a prima facie tort case:
proximate causation.
The defendants argue that even if they were negligent, Carneal's intentional, violent actions
constitute a superseding cause of the plaintiffs' damages and sever the defendants liability for the deaths of Carneal's
victims. Generally, a third party's criminal action that directly causes all of the damages will break the chain of causation.
Yet, Kentucky courts have held that an intervening third-party criminal act will not be a superseding cause breaking the
chain of causation if the act was reasonably foreseeable. See, e.g., . In the plaintiff had been injured by a fire in his leased
store. The fire started when trash piled next to the building by the landlord was ignited by an arsonist. The court held
that the arsonist's intervening act was not a superseding cause of the fire because the act was a reasonably foreseeable
result of the landlord's piling of flammable material next to the building.
The court reached the question of causation in because of the landlord's well established duty of care to protect its tenants
from injury. See, e.g., (holding landlord liable for failing to protect tenant from being shot by a third-party intruder). As we
have noted above, the duty of the media defendants in this case is far from as firmly established. Outside of the landlordtenant context, Kentucky courts are far more likely to determine that an intervening criminal act is a superseding cause.
See . Compare (confronting the question of superseding cause in the context of the well established duty of driver to protect
his passenger). In the plaintiff was injured by a third party who battered her by spraying corrosive drain cleaner in her
face. The plaintiff contended that the manufacturer of the drain cleaner was negligent and should have anticipated that it
could be used as a weapon. The court held that batteror's reaction to and use of drain cleaner as a weapon was sufficiently
unforeseeable to constitute a superseding cause. .
A similar analysis is applicable here. Our determination regarding the idiosyncratic nature of Carneal's reaction to the
defendants' media would likely compel us to hold that his action constitutes a superseding cause. We, however, need not
reach this question because we have determined that the defendants did not owe a duty to protect the decedants.
IV
James also contends that the district court erred in dismissing his products liability claims. In his complaint, James
alleged that the defendants' video games, movie, and internet transmissions constitute "products," and their violent content
"product defects." Under Kentucky law, manufacturers, distributors, and retailers of "products" are strictly liable for
damages caused by "defects" in those products. ; . If this theory of liability were to apply, James's failure to establish a duty
to exercise ordinary care to prevent the victims' injuries (See Part III.A) would be irrelevant. Under strict liability, James
would only be required to establish causation.
Of course, James would continue to encounter proximate causation problems. See Part III.B.
James's theory of product liability in this case is deeply flawed. First, and something none of the parties have mentioned,
the "consumers or ultimate users" of the alleged products are not the ones claiming physical harm in this case. . Carneal was
the person who "consumed" or "used" the video games, movie, and internet sites.
Allegedly because of Carneal's
consumption of the products, he killed the victims in this case. In early products liability law, courts had required privity
between the final retailer of the product and the injured plaintiff for strict liability to attach. Eventually, courts broadened
the class of plaintiffs who could avail themselves of strict liability to include those who consumed or ultimately used the
product. Kentucky courts, but certainly not all courts, have extended the protection of products liability to "bystanders"
who are injured by the product, but are not "using" or "consuming" the product. (holding that bystander could recover on
strict liability basis for injuries caused by exploding soda bottle); , n.1 (noting the split in authority regarding whether
bystanders may recover on a strict liability basis). Imposing strict liability for the injuries suffered in this case would be an
extension of Kentucky's bystander jurisprudence, as the decedents were not directly injured by the products themselves, but
by Carneal's reaction to the products.
We place this open question of Kentucky law aside as the parties apparently have. James has failed to demonstrate a prior
requirement, that the video games, movies, and internet sites are "products" for purposes of strict liability. This was the
basis on which the district court dismissed James's products liability claims, holding that the video games, movie, and
internet transmissions were not "products," at least in the sense that James sought to attach liability to them.
This court has already substantially resolved the question of Kentucky law presented. In , this court held that "words and
pictures" contained in a board game could not constitute "products" for purposes of maintaining a strict liability action. We
cannot find any intervening Kentucky authority that persuades us that no longer correctly states Kentucky law. James's
theory of liability, that the ideas conveyed by the video games, movie cassettes and internet transmissions, caused Carneal
to kill his victims, attempts to attach product liability in a nearly identical way.
James argues that, at least in this case, we are not just dealing with "words and pictures." Carneal, of course, had video
game cartridges and movie cassettes. James argues that the test for determining whether an item is a product for purposes
of Kentucky law is whether it is "tangible," and that the cartridges and cassettes are "tangible." As for the internet sites,
James points us to a court that has held that "electricity" is a "product" for purposes of strict liability under Kentucky law.
See . Internet sites are nothing more than communicative electrical pulses, James contends. James argues that there is no
relevant difference between the internet transmissions and the electricity.
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297
And of course James is partially correct. Certainly if a video cassette exploded and injured its user, we would hold it a
"product" and its producer strictly liable for the user's physical damages. In this case, however, James is arguing that the
words and images purveyed on the tangible cassettes, cartridges, and perhaps even the electrical pulses through the
internet, caused Carneal to snap and to effect the deaths of the victims. When dealing with ideas and images, courts have
been willing to separate the sense in which the tangible containers of those ideas are products from their communicative
element for purposes of strict liability. See, e.g., ; . We find these decisions well reasoned. The video game cartridges,
movie cassette, and internet transmissions are not sufficiently "tangible" to constitute products in the sense of their
communicative content.
V
For all the foregoing reasons, we AFFIRM the district court's dismissal of all James's claims.
Supplemental Case Printout
for: Landmark in the Law:
MacPherson v. Buick Motor Co.
(1916)
111 N.E. 1050
(Cite as: 217 N.Y. 382, 111 N.E. 1050)
Donald C. MACPHERSON, Respondent,
v.
BUICK MOTOR COMPANY, Appellant.
Court of Appeals of New York
Argued January 24, 1916
Decided March 14, 1916
MacPherson v. Buick Motor Co.,160 App. Div. 55, affirmed.
APPEAL, by permission, from a judgment of the Appellate Division of the Supreme Court in the third judicial department,
entered January 8, 1914, affirming a judgment on favor of plaintiff entered uall probability be used at once * * * before a
reasonable opportunity for discovering any defect which might exist,' and that the thing supplied is of such a nature 'that a
neglect of ordinary care or skill as to its condition or the manner of supplying it would probably cause danger to the person
or property of the person for whose use it was supplied, and who was about to use it.' On the other hand, he would exclude a
case 'in which the goods are supplied under circumstances in which it would be a chance by whom they would be used or
whether they would be used or not, or whether they would be before there would probably be means of observing any defect,'
or where the goods are of such a nature that 'a want of care or skill as to their condition or the manner of supplying them
would not probably *389 produce danger of injury to person or property.' What was said by Lord Esher in that case did not
command the full assent of his associates. His opinion has been criticised 'as requiring every man to take affirmative
precautions to protect his neighbors as well as to refrain from injuring them' (Bohlen, Affirmative Obligations in the Law of
Torts,44 Am Law Reg.(N.S.) 341). It may not be an accurate exposition of the law of England. Perhaps it may need some
qualification even in our own state. Like most attempts at comprehensive definition, it may involve errors of inclusion and of
exclusion. But its tests and standards, at least in their underlying principled, with whatever qualifications may be called for
as they are applied to varying conditions, are the tests and standards of our law.
We hold, then, that the principle of Thomas v. Winchester is not limited to poisons, explosives, and things of like nature, to
things which in their normal operation are implements of destruction. If the nature of a thing is such that it is reasonably
298
CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW TODAY: THE ESSENTIALS
certain to place and limb in peril when negligently made, it is then a thing of danger. Its nature gives warning of the
consequences to be expected. If to the element of danger there is added knowledge that the thing will be used by persons
other than the purchaser, and used without new tests then, irrespective of contract, the manufacturer of this thing of danger
is under a duty to make it carefully. That is as far as we are required to go for the decision of this case. There must be
knowledge of a danger, not merely possible, but probable. It is possible to use almost anything in a way that will make it
dangerous if defective. That is not enough to charge the manufacturer with a duty independent of his contract. Whether a
given thing is dangerous may be sometimes a question for the court and sometimes a question for the jury. There must also
be knowledge that in the usual course of events the danger will be shared by others than the buyer. Such knowledge may
often be *390 inferred from the nature of the transaction. But it is possible that even knowledge of the danger and of the
use will not always be enough. The proximity or remoteness of the relation is a factor to be considered. We are dealing now
with the liability of the manufacturer of the finished product, who puts it on the market to be used without inspection by his
customers. If he is negligent, where danger is to be foreseen, a liability will follow. We are not required at this time to say
that it is legitimate to go back of the manufacturer of the finished product and hold the manufacturers of the component
parts. To make their negligence a cause of imminent danger, an independent cause must often intervene; the manufacturer
of the finished product must also fail in his duty of inspection. It may be that in those circumstances the negligence of the
earlier members of the series as too remote to constitute, as to the ultimate user, an actionable wrong (Beven on Negligence
(3d ed.),50,51,54; Wharton on Negligence (2d ed.),s134; Leeds v. N.Y. Tel. Co., 178 N.Y. 118; Sweet v. Perkins, 196 N.Y. 482;
Hayes v. Hyde Park, 153 Mass.514, 516). We leave that question open to you. We shall have to deal with it when it arises.
The difficulty which it suggests is not present in this case, There is here no break in the chain of cause and effect. In such
circumstances, the presence of a known danger, attendant upon a known use, makes vigilance a duty. We have put aside
the notion that the duty to safeguard life and limb, when the consequences of negligence may be foreseen, grows out of
contract and nothing else. We have put the source of the obligation where it ought not be. We have put its source in the
law.
From this survey of the decisions, there thus emerges a definition of the duty of a manufacturer which enables us to
measure this defendant's liability. Beyond all question, the nature of an automobile gives warning of probable danger if its
construction is defective. This *391 automobile was designed to go fifty miles an hour. Unless its wheels were sound and
strong, injury was almost certain. It was as much a thing of danger as a defective engine for a railroad. The defendant
knew the danger. It knew also that the care would be used by persons other than the buyer. This was apparent from its
size; there were seats for three persons. It was apparent also from the fact that the buyer was a dealer in cars, who bought
to resell. The maker of this car supplied it for the use of purchasers from the dealer just as plainly as the contractor in
Devlin v. Smith supplied the scaffold for use by the servants of the owner. The dealer was indeed the one person of whom it
might be said with some approach to certainly that by him the car would not be used. Yet the defendant would have us say
that he was the one person whom it was under a legal duty to protect. The law does not lead us to so inconsequent a
conclusion. Precedents drawn from the days of travel by stage coach do not fit the conditions of travel today. The principle
that the danger must be imminent does not change, but the things subject to the principle do change. They are whatever
the needs of life in a developing civilization require them to be.
In reaching this conclusion, we do not ignore the decisions to the contrary in other jurisdictions. It was held in Cadillac
M.C. Co. v. Johnson(221 Fed. Rep. 801) that an automobile is not within the rule of Thomas v. Winchester. There was,
however, a vigorous dissent. Opposed to that decision is one of the Court of Appeals of Kentucky (Olds Motor Works v.
Shaffer, 145 Ky.616). The earlier cases are summarized by Judge Sanborn in Huset v. J.I. Case Threshing Machine Co. (120
Fed.Rep. 865). Some of them, at first sight inconsistent with our conclusion, may be reconciled upon the ground that the
negligence was too remote, and that another cause had intervened. But even when they cannot be reconciled, the difference
is rather in the application *392 of the principle than in the principle itself. Judge Sanborn says, for example, that the
contractor who builds a bridge, or the manufacturer who builds a car, cannot ordinarily foresee injury to other persons than
the owner as the probable result (120 Fed. Rep. 865,at p.867). We take a different view. We think that injury to others is to
be foreseen not merely as a possible, but as an almost inevitable result. (See the trenchant criticism in Bohlen, supra, at
p.351). Indeed Judge Sanborn concedes that his view is not to be reconciled with our decision in Devlin v. Smith (supra).
The doctrine of that decision has now become the settled law of this state,and we have no desire to depart form it.
In England the limits of the rule are still unsettled. Winterbottom v. Wright (10 M. & W. 109) is often cited. The defendant
undertook to provide a mail coach to carry the mail bags. The coach broke down from latent defects in its construction. The
defendant, however, was not the manufacturer. The court held that he was not liable for injuries to a passenger. The case
was decided on a demurrer th the declaration. Lord Esher points out in Heaven b. Pender (supra, at p.513) that the form of
the declaration was subject to criticism. It did not fairly suggest the existence of a duty aside form the special contract which
was the plaintiff's main reliance. (See the criticism of Winterbottom v. Wright, in Bohlen, supra, at pp.281, 283). At all
events, in Heaven v. Pender(supra) the defendant, a dock owner, who put up a staging outside a ship, was held liable to the
servants of the shipowner. In Elliot v. Hall (15 Q.B.D. 315) the defendant sent out a defective truck laden with goods which
he had sold. The buyer's servants unloaded it, and were injured because of the defects. It was held that the defendant was
CHAPTER 13: WARRANTIES, PRODUCT LIABILITY, AND CONSUMER LAW
299
under a duty 'not to be guilty of negligence with regard to the state and condition of the truck. ' There seems to have been a
*393 return to the doctrine of Winterbottom v. Wright in Earl v.Lubbock (L.R.(1905) 1 K.B. 253). In that case, however, as
in to the earlier one, the defendant was not the manufacturer. He had merely made a contract to keep the van in repair. A
later case (White v. Steadman, L.R.(1913), 3 K.B. 340,348). emphasizes that element. A livery stable keeper who sent put a
vicious horse was held liable not merely to his customer but also to another occupant of the carriage, and Thomas v.
Winchester was cited and followed (White v. Steadman, supra, at pp.348, 349). It was again cited and followed in Dominion
Natural Gas Co. v. Collins (L.R.(1909)A.C. 640,646). From these cases a consistentprinciple is with difficulty extracted. The
English courts,however, agree with ours in holding that one who invites another to makeuse of an appliance is bound to the
exercise of reasonable care (Caledonian Ry.Co. v. Mulholland, L.R.(1898)A.C.216, 227; Indermaur v. Dames, L.R. (1 C.P.)
274). That at bottom is the underlying principle of Devlin v. Smith. The contractor who builds the scaffold invites the
owner's work-men to use it. The manufacturer who sells the automobile to the retail dealer invites the dealer's customers to
use it. The invitation is addressed in the one case to determinate persons and in the other to an indeterminate class, but in
each case it is equally plain, and in each its consequences must be the same.
There is nothing anomalous in a rule which imposes upon A, who has contracted with B, a duty to C and D and others
according as he knows or does not know that the subject matter of the contract is intended for their use. We may find an
analogy in the law which measures the liability of landlords. If A leases to B a tumble-down house he is not liable, in the
absence of fraud, to B's guests who enter it and are injured. This is because B is then under the duty to repair it, the lessor
has the right to suppose that he will fulfill that duty, and if he *394 omits to do so, his guests must look to him (Bohlen,
supra, at p.276). But if A leases a building to be used by the lessee at once as a place of public entertainment, the rule is
different. There is injury to persons other than the lessee is to be foreseen, and foresight of the consequences involves the
creation of a duty (Junkermann v. Tilyou R. Co.,213 N.Y. 404, and cases there cited).
In this view of the defendant's liability there is nothing in- consistent with the theory of liability on which the case was
tried. It is true that the court told the jury that 'an automobile is not an inherently dangerous vehicle.' The meaning,
however, is made plain by the context. The meaning is that danger is not to be expected when the vehicle is well
constructed. The court left it to the jury to say whether the defendant ought to have foreseen that the car, if negligently
constructed, would become 'imminently dangerous.' Subtle distinctions are drawn by the defendant between things
inherently dangerous and things imminently dangerous, but the case does not turn upon these verbal niceties. If danger
was to be expected as reasonably certain, there was a duty of vigilance, and this whether you call the danger inherent or
imminent. In varying forms that the court would not have been justified in ruling as a matter of law that the car was a
dangerous thing. If there was any error, it was none of which the defendant can complain.
We think the defendant was not absolved from a duty of inspection because it bought the wheels from a reputable
manufacturer. It was not merely a dealer in automobiles. It was a manufacturer of automobiles. It was responsible for the
finished product. It was not at liberty to put the finished product on the market without subjecting the componet parts to
ordinary and simple tests (Richmond & Danville R.R. Co. v. Elliot, 149 U.S. 266,272). Under the charge of the trial judge
nothing more was *395 required of it. The obligation to inspect must vary with the nature of the thing to be inspected. The
more probable the danger, the greater the need of caution. There is little analogy between this case and Carlson v. Phoenix
Bridge Co. (132 N.Y. 273), where the defendant bought a tool for a servant's use. The making of tools was not the business
on which the master was engaged. Reliance on the skill of the manufacturer was proper and almost inevitable. But that is
not the defendant's situation. Both by its relation to the work and by the nature of its business, it is charged with a stricter
duty.
Other rulings complained of have been considered, but no error has been found on them.
The judgment should be affirmed.