“Sophisticated purchaser” defense fails

Defendant cannot assert that its products were not dangerous and at the same time claim it relied on the Navy to warn end users of its dangerous products.

Background

On Jan. 12, 2018, plaintiffs filed a motion in limine to exclude evidence and testimony regarding the alleged knowledge or negligence of the Navy. The motion and subsequent response by defendant John Crane Inc. both address the Navy’s alleged knowledge and negligence relating to (1) the sophisticated purchaser defense; (2) the government contractor defense; (3) superseding causation; and (4) state of the art evidence.

On July 31, 2018, the magistrate judge determined that a portion of plaintiffs’ motion seeks to strike two of JCI’s affirmative defenses, and that portion of the motion is construed as a motion for summary judgment. The magistrate judge issued an R&R on Aug. 24, 2018 regarding those sophisticated purchaser and government contractor defenses, and recommended granting judgment in favor of plaintiffs. Other aspects of plaintiffs’ motion were addressed in a separate opinion and order issued by the magistrate judge that same day.

Sophisticated purchaser defense

JCI objects to the R&R, arguing that the magistrate judge erred in relying on Oman v. Johns-Manville Sales Corp., 764 F.2d 224 (4th Cir. 1985) and Willis v. Raymark Indus., 905 F.2d 793 (4th Cir. 1990), instead of cases in which the plaintiff’s employer actively participated in the design of the harmful product in question. The court overrules JCI’s objection.

The Fourth Circuit made clear through Oman and Willis that to successfully prove a sophisticated purchaser defense, a defendant must demonstrate that it reasonably relied on the employer to warn the ultimate users of the product. This holding applies to cases in which the defendant asserts a sophisticated purchaser defense regardless of whether the product was designed by the manufacturer or the employer. This reliability element is confirmed clearly as the fourth factor listed under comment n to section 388 of the Restatement.

After acknowledging this requirement, the magistrate judge correctly determined that JCI has presented no contemporaneous evidence suggesting that JCI reasonably relied on the Navy to warn sailors such as plaintiff.

After correctly identifying the standards established by section 388 of the Restatement and Fourth Circuit case law, the R&R evaluated the comment n factors and persuasively determined that JCI could not prove its defense as a matter of law. This conclusion is derived in part from the argument presented by JCI that its gaskets and packing products were not dangerous and did not require a warning. The court agrees with the R&R that JCI cannot reasonably claim that it relied on the Navy to warn end users of its dangerous products and at the same time argue that its products were not dangerous. The court adopts the R&R’s thoroughly analyzed and supported findings and recommendations in its entirety.

Government contractor defense

Upon inquiry, JCI advised the court that it is not asserting or relying upon the government contractor defense in this case. Accordingly, the R&R recommended that summary judgment be granted in plaintiff’s favor on the government contractor defense. JCI has not objected, and the court adopts the R&R regarding the inapplicability of the government contractor defense.

Granted.

Goodrich v. John Crane Inc. Case No. 17-cv-00009, Sept. 28, 2018. EDVA at Newport News (Allen). VLW 018-3-430. 8 pp.