1 DePuy Orthopaedics, Inc. is a wholly owned subsidiary of

DePuy, Inc. DePuy, Inc. is a wholly owned subsidiary of Johnson

& Johnson International. Johnson & Johnson International is

a wholly owned subsidiary of Johnson & Johnson. For convenience, we will refer to the defendants collectively as “DePuy.”

In the

United States Court of Appeals

For the Seventh Circuit ____________

No. 07-1493

THOMAS M. KLEIN and ANNIE J. RICE,

Plaintiffs-Appellants,

v.

DEPUY, INCORPORATED, DEPUY ORTHOPAEDICS,

INCORPORATED, and JOHNSON & JOHNSON,

Defendants-Appellees.

____________

Appeal from the United States District Court

for the Northern District of Indiana, Fort Wayne Division.

No. 05 C 283—Theresa L. Springmann, Judge.

____________

ARGUED SEPTEMBER 18, 2007—DECIDED OCTOBER 25, 2007

____________

Before EVANS, WILLIAMS, and SYKES, Circuit Judges.

EVANS, Circuit Judge. In this products liability/personal

injury suit, the defendants, DePuy Orthopaedics, Inc.,

DePuy, Inc., and Johnson & Johnson,1

 contend that North

Carolina law applies and that the case must be dismissed
2 No. 07-1493

under its six-year statute of repose. The plaintiffs, Mitch

Klein and Annie Rice (her derivative claim is only for

loss of consortium so we’ll refer only to “Klein” as we

move through our opinion), maintain that Indiana law

applies and that the suit is timely under its more generous ten-year statute of repose. Alternatively, Klein

contends that, if he is stuck with North Carolina law, an

exception should be applied to permit his suit to be viewed

as timely. According to DePuy, no such “exception” exists.

District Judge Theresa Springmann thought that DePuy

had the better of the argument, so she granted its motion

for summary judgment. Klein v. DePuy, Inc., 476 F. Supp.

2d 1007, 1023 (N.D. Ind. 2007). The case is now before us

on Klein’s appeal. As only questions of law are presented,

our review is de novo. Tanner v. Jupiter Realty Corp., 433

F.3d 913, 915 (7th Cir. 2006). Summary judgment is

proper if “there is no genuine issue as to any material fact

and [] the moving party is entitled to a judgment as a

matter of law.” Fed. R. Civ. P. 56(c).

In September 1998, Klein underwent a left total hip

replacement surgery in his home state of North Carolina.

The prosthesis used in the surgery was manufactured by

DePuy Orthopaedics, an Indiana corporation with its

principal place of business in Indiana. Some time later,

Klein experienced severe pain in his left hip, which he

reported to his orthopedic surgeon, Dr. Jack W. Bowling,

Jr. Dr. Bowling told Klein that his hip replacement was

failing due to (among other things) osteolysis, a progressive disease commonly seen in conjunction with artificial

joint replacement and caused by an inflammatory reaction to particulate debris from an artificial joint.

On June 9, 2006, Dr. Bowling performed revision surgery

on Klein’s hip, removing various components of the

prosthesis and confirming his diagnosis of osteolysis. Dr.

Bowling believed that the hylamer cup liner used in
No. 07-1493 3

2 After DePuy moved for summary judgment, the parties filed

(and the district court granted) a joint motion for extension of

deadlines to allow for Klein’s revision surgery.

3 Here, it is undisputed that a conflict exists—that is, that the

“differences between the laws of the states are ‘important

enough to affect the outcome of the litigation.’ ” Simon, 805

N.E.2d at 805. Thus, we will not belabor this preliminary matter.

Klein’s hip replacement wore at a faster rate than predicted, causing excessive amounts of polyethylene debris

to cascade down into Klein’s proximal femur area. The

excessive debris, Dr. Bowling said, resulted in osteolysis,

which, in turn, caused Klein’s pain and the failure of his

prosthesis. Significantly for our purposes, Klein received

(and continues to receive) all of his medical care in North

Carolina.

On August 15, 2005, Klein filed suit in the Northern

District of Indiana, maintaining that the hip prosthesis

was defective and that it caused his injuries. Klein alleged

ten counts of misconduct, including products liability,

failure to warn, negligence, negligent and fraudulent

misrepresentation, breach of warranties, and negligent

infliction of emotional distress. As we noted, Ms. Rice,

Klein’s wife at the time of the suit, brought a claim for

loss of consortium.

On January 19, 2006, DePuy moved for summary

judgment on the basis of North Carolina’s six-year statute

of repose. On January 31, 2007,2

 Judge Springmann

granted DePuy’s motion in a comprehensive opinion and

order. This appeal followed.

The first issue is whether Judge Springmann correctly

concluded that Indiana would apply North Carolina law

(six-year statute of repose), as opposed to Indiana law (tenyear statute of repose), to Klein’s claims. In tort cases,

where a conflict exists,3

 Indiana presumes that the traditional rule—lex loci delicti—governs. Simon v. United
4 No. 07-1493

4 At oral argument, Klein’s counsel correctly conceded that her

clients had an uphill battle, candidly admitting that, if the

shoe were on the other foot, she would be arguing that North

Carolina law governed.

States, 805 N.E.2d 798, 805 (Ind. 2004). Under the rule,

the district court applies the substantive law of “the

state where the last event necessary to make an actor

liable for the alleged wrong takes place.” Hubbard Mfg. Co.

v. Greeson, 515 N.E.2d 1071, 1073 (Ind. 1987). If, and

only if, that location “bears little connection” to the legal

action, the presumption in favor of the location of the tort

may be overcome and additional factors may be considered. Id. at 1073-74.

Judge Springmann found that North Carolina was the

location of the tort and that it bore enough of a connection

to the legal action for the traditional rule to apply. On

appeal, Klein asserts three arguments against this

ruling: (1) the location of the tort was actually Indiana

because DePuy designed, manufactured, marketed, and

distributed the allegedly defective product there; (2)

assuming arguendo that North Carolina was the location

of the tort, it bears so little significance to the legal action

that the presumption is rebutted; and (3) policy considerations favor applying Indiana law. Each of these arguments fails.4

Klein’s first argument—that Indiana was the location of

the tort—is directly contradicted by case law. As we have

previously stated, Indiana’s lex loci delicti principle

points to the location of the injury, not the defendant’s

corporate headquarters, as the source of law. In re

Bridgestone/Firestone, Inc., 288 F.3d 1012, 1016 (7th Cir.

2002). Furthermore, in a recent case, Alli v. Eli Lilly and

Co., the Indiana Court of Appeals found that the last event

necessary to complete the alleged torts of strict products
No. 07-1493 5

liability, misrepresentation, and negligence brought

against the manufacturer of an antidepressant medication was the injury that occurred when the plaintiff’s

husband committed suicide, not when the antidepressants were manufactured. 854 N.E.2d 372, 378 (Ind. Ct.

App. 2006); see also Simon, 805 N.E.2d at 806 (finding

that the last event necessary to make the defendant

liable for wrongful death was the injury that occurred

when the plane crashed and the decedents died, not when

the prior negligent acts were committed).

In this case, the last event necessary to make DePuy

liable was the injury and physical harm that occurred

when the prosthesis failed and Klein developed osteolysis.

This occurred in North Carolina, making the Tar Heel

State the location of the tort.

Klein’s second argument—that North Carolina bears

little significance to the legal action—requires even less

discussion. Indiana law tells us that “[i]n a large number

of cases, the place of the tort will be significant and the

place with the most contacts.” Hubbard, 515 N.E.2d at

1073. Only in “rare cases” will the presumption in favor

of the traditional rule be overcome. Simon, 805 N.E.2d

at 806. In Alli, the Indiana Court of Appeals found that

the location of the tort was significant where the plaintiff’s late husband lived, worked, and received his medical

treatment—including the antidepressant medication

implicated in the lawsuit—in that state. 854 N.E.2d

at 379.

Here, Klein resided, consulted with doctors, and decided

to undergo hip replacement surgery in North Carolina. He

received his prosthesis, diagnosis of osteolysis, revision

surgery, and all of his medical care there. We would be

hard-pressed to conclude anything but that the location of

the injury is significant to this action.
6 No. 07-1493

5 Currently, North Carolina law does not allow us to certify an

unsettled question of state law to its Supreme Court for resolution.

6 N.C. Gen. Stat. § 1-50(a)(6) was previously § 1-50(6). Like the

district court, we will use these two citations interchangeably.

All statutes cited in the following discussion refer to N.C. Gen.

Stat.

Klein’s final argument—that policy considerations

favor applying Indiana law—also comes up short. While

Indiana does have a public policy exception, it is reserved

for cases where its sister state’s law is “immoral, unnatural, unjust, or prejudicial to the general interests of the

citizens of Indiana.” Alli, 854 N.E.2d at 380; see also

Schaffert by Schaffert v. Jackson Nat’l Life Ins. Co., 687

N.E.2d 230, 234 (Ind. Ct. App. 1997) (declining to use the

doctrine where the sister state’s law was not “immoral or

against natural justice”).

The difference between the North Carolina and Indiana

statutes at issue in this case concerns the time frame

during which consumers may sue a manufacturer for

product defects. This issue does not implicate the general

interests of Indiana citizens, so we conclude that North

Carolina’s law would not offend the public policy of

Indiana. As a result, Klein is stuck with North Carolina’s

six-year statute of repose. And that makes his suit untimely.

We now turn to the second issue: whether the North

Carolina Supreme Court would apply an exception to its

statute of repose to permit this suit to be viewed as

timely.5

 The parties agree that N.C. Gen. Stat. § 1-50(a)(6)6

governs this case. Section 1-50(a)(6) says that “[n]o action

for the recovery of damages for personal injury . . . based

upon or arising out of any alleged defect or any failure

in relation to a product shall be brought more than six
No. 07-1493 7

years after the date of initial purchase for use or consumption.” But is an exception lurking here that gives

Klein more time to sue?

At first blush, this seems like an easy issue to decide.

As opposed to a statute of limitations, which begins

running upon the accrual of some claim and permits

equitable exceptions, § 1-50(a)(6) is a statute of repose,

which “serves as an unyielding and absolute barrier” to a

cause of action, regardless of whether that cause has

accrued. Black v. Littlejohn, 325 S.E.2d 469, 475 (N.C.

1985). Furthermore, the plain language of § 1-50(a)(6)

creates no exceptions at all. Indeed, the North Carolina

Supreme Court has already stated that “[i]t is clear from

this language that Section 1-50(6) excludes all actions

brought after six years.” Tetterton v. Long Mfg. Co., 332

S.E.2d 67, 72 (N.C. 1985). However, one North Carolina

case, decided more than 20 years ago, prevents this

from being the end of our discussion.

Wilder v. Amatex Corp. held that a different statute, § 1-

15(b), had no application to claims arising from disease.

336 S.E.2d 66, 73 (N.C. 1985). Section 1-15(b), which

actually had been repealed by the time Wilder was decided,

stated:

Except where otherwise provided by statute, a cause of

action, other than one for wrongful death or one for

malpractice arising out of the performance or failure

to perform professional services, having as an essential element bodily injury to the person or a defect

in or damage to property which originated under

circumstances making the injury, defect or damage not

readily apparent to the claimant at the time of its

origin, is deemed to have accrued at the time the

injury was discovered by the claimant, or ought

reasonably to have been discovered by him, whichever

event first occurs; provided that in such cases the
8 No. 07-1493

period shall not exceed ten years from the last act

of the defendant giving rise to the claim for relief.

Although the primary purpose of § 1-15(b) was to change

the accrual date from which the period of limitations

began to run, the legislature also added the final clause,

which created a ten-year statute of repose. Wilder, 336

S.E.2d at 69. Importantly, Wilder construed both provisions—that is, all of § 1-15(b)—to apply only to “latent

injury claims,” or “cases in which the bodily injury . . . was

not readily apparent to the claimant at the time of its

origin.” Id. at 70 (emphasis omitted).

The reason § 1-15(b) did not apply to claims arising

from disease was because the Wilder court found that

diseases were not latent injuries. Id. at 72-73. After

examining workers’ compensation statutes and its decisions interpreting them, the court concluded that, when

it drafted § 1-15(b), the legislature already recognized

that a disease’s diagnosis was the “first injury” from

which various time periods began to run. Id. at 72. Because diseases have a first identifiable injury, the court

said, they are not “latent,” and § 1-15(b)—including its

statute of repose—does not govern them. Id. at 73.

Changes in the bill from its original form (which specifically referred to disease) to its final enactment (which

omitted all references to disease) also supported the

court’s conclusion that § 1-15(b) excepted claims arising

from disease. Id.

Klein argues that the North Carolina Supreme Court

would apply this “disease exception” to § 1-50(a)(6). This

is a stretch, considering that Wilder involved an entirely

different statute and that no North Carolina state court

has ever applied a disease exception to § 1-50(a)(6). But,

a case out of the Fourth Circuit, again decided more

than 20 years ago, predicted that just such an exception

would apply.
No. 07-1493 9

In Hyer v. Pittsburg Corning Corp., an asbestosis case,

the Fourth Circuit adopted the proposition that Wilder

“makes it plain . . . that the [North Carolina] Supreme

Court does not consider disease to be included within a

statute of repose directed at personal injury claims

unless the Legislature expressly expands the language

to include it.” 790 F.2d 30, 34 (4th Cir. 1986) (quoting

Garder v. Asbestos Corp., 634 F. Supp. 609, 612 (W.D.N.C.

1986)). Consequently, the court applied Wilder’s “disease

exception” to § 1-50(6). Id. In subsequent cases, the

Fourth Circuit followed Hyer without much reconsideration

or elaboration. See Bullard v. Dalkon Shields Claimants

Trust, 74 F.3d 531, 533 (4th Cir. 1996); Guy v. E.I. DuPont

de Nemours & Co., 792 F.2d 457, 460 (4th Cir. 1986);

Silver v. Johns-Manville Corp., 789 F.2d 1078, 1080 (4th

Cir. 1986). Significantly, none of these cases has been cited

in any reported North Carolina state court decision.

Judge Springmann declined to follow Fourth Circuit

precedent because she believed that it misinterpreted

Wilder. We agree. While those cases accurately stated

Wilder’s holding, they did not recognize the latent injury

distinction that was so vital to Wilder’s outcome. Remember, Wilder held that diseases were excluded from § 1-15(b)

because § 1-15(b) was limited to “latent injuries.” However,

Hyer interpreted Wilder to hold that, in the context of a

statute of repose, diseases were not “injuries” at all. As a

result, Hyer applied a disease exception to a statute that

was not limited to latent injuries. We, of course, “carefully

consider the opinions of our sister circuits,” Atchison,

Topeka and Santa Fe Ry. Co. v. Pena, 44 F.3d 437, 443

(7th Cir. 1994). But with all due respect here, we cannot

follow the Fourth Circuit on this issue.

Now that we have rejected Hyer’s analysis of the “disease

exception,” we turn to our own prediction. After considering the three factors on which the Wilder court
10 No. 07-1493

based its decision regarding § 1-15(b), we conclude that

the North Carolina Supreme Court would not apply an

exception to § 1-50(a)(6).

The first factor that Wilder considered was the statute’s purpose. As we have stated, the primary purpose

of § 1-15(b) was to change the accrual date from which

the period of limitations began to run on latent injury

claims. Wilder, 336 S.E.2d at 69. Section 1-50(a)(6),

however, “was generally intended to shield [ ] manufacturers of durable goods from ‘open-ended’ liability

created by allowing claims for an indefinite period of time

after the product was first sold and distributed.” Tetterton,

332 S.E.2d at 73. As opposed to § 1-15(b), § 1-50(a)(6) says

nothing about accrual nor, as we have discussed, is it

limited to latent injuries.

Second, Wilder looked at the state of the law when the

statute was enacted. The court concluded that there

was no need for the legislature to change the accrual

date for diseases at that time because it already recognized that diseases were not latent. 336 S.E.2d at 73.

Because it deals with neither latent injuries nor accrual,

the state of the law regarding when diseases are considered “injuries” for accrual purposes is irrelevant to § 1-

50(a)(6). Rather, when § 1-50(a)(6) was enacted, “[t]he

number of suits being brought against manufacturers

was increasing . . . and the legislature sought to curtail

such suit and to limit the manufacturers’ liability by

enacting product liability reform statutes.” Tetterton, 332

S.E.2d at 73. As a result, unlike § 1-15(b), § 1-50(a)(6) is

solely “a statute of repose and an absolute bar to plaintiffs’

products liability action[s].” Id. at 75.

Third, Wilder focused on the deliberate omission of

reference to disease from earlier versions of the bill to the

final version. However, Klein concedes that similar

evidence regarding § 1-50(a)(6) does not exist. Thus, the
No. 07-1493 11

three Wilder factors all support a conclusion that, unlike

§ 1-15(b), § 1-50(a)(6) was not intended to contain a

“disease exception.”

The final strike against Klein’s position comes from a

North Carolina case that considered whether a “disease

exception” would apply to § 1-52(16), the statute that

replaced § 1-15(b). Section 1-52(16) states:

Unless otherwise provided by statute, for personal

injury or physical damage to claimant’s property, the

cause of action, except in causes of actions referred to

in G.S. 1-15(c), shall not accrue until bodily harm to

the claimant or physical damage to his property

becomes apparent or ought reasonably to have become

apparent to the claimant, whichever event first occurs.

Provided that no cause of action shall accrue more

than 10 years from the last act or omission of the

defendant giving rise to the cause of action.

As a successor statute, § 1-52(16) looks a lot like § 1-15(b)

with an important difference: unlike § 1-15(b), § 1-52(16)

is not limited to latent injury claims. Wilder, 336 S.E.2d

at 69.

In Dunn v. Pacific Employers Insurance Co., an occupational disease case, the North Carolina Supreme Court

found that § 1-52(16) applied to claims arising out of

disease. 418 S.E.2d 645, 648 (N.C. 1992) (“Decedent’s

bodily injury claim, had he lived, would have . . . been

time-barred three years later under [ ] § 1-52(16).”). This

finding is consistent with Wilder because (to repeat)

unlike its predecessor, § 1-52(16) is not limited to latent

injury claims. Dunn’s language also rejects Hyer’s proposition that diseases must be expressly included in a statute

of limitation or repose directed at personal injury claims

for the statute to apply. Because the North Carolina

Supreme Court has concluded that even § 1-15(b)’s successor statute does not exempt diseases, we find no
12 No. 07-1493

reason to believe that it would apply such an exception to

the less-similar statute of repose at issue in this case.

In sum, we agree with Judge Springmann that North

Carolina law, rather than Indiana law, applies to Klein’s

claims. We also agree that, had the North Carolina

Supreme Court received this case, it would not have

applied a “disease exception” to the six-year statute of

repose at issue. The plain language of the statute, its

history, and North Carolina case law all support our

belief that no exception was intended. We leave it up to

the North Carolina legislature to amend the statute if

we are mistaken.

For the foregoing reasons, summary judgment in favor

of the defendants is AFFIRMED.

A true Copy:

Teste: 

 ________________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit 

USCA-02-C-0072—10-25-07