Opinion ID: 1377843
Heading Depth: 3
Heading Rank: 1

Heading: Breach of express and implied warranty and fraud

Text: Sindell, like the present case, involved a plaintiff who alleged she was injured by DES which her mother took during pregnancy to prevent miscarriage. She filed an action against a number of drug manufacturers, alleging they had all produced DES, and she stated causes of action for negligence, strict liability, violation of express and implied warranties, and false and fraudulent representations. After the plaintiff admitted that she could not identify the manufacturer which made the DES taken by her mother, the trial court sustained the defendants' demurrers without leave to amend and dismissed the action. This court reversed the judgment. We acknowledged the usual rule that a plaintiff has the burden of showing that the damages suffered were caused by the defendant, but held that modification of the rule was warranted under the circumstances. We observed that our modern, complex, industrialized society had created fungible goods like DES that harmed consumers but could not be traced to a specific producer. For the same reasons of policy that were the impetus for the creation of the doctrine of strict liability, we reasoned that the manufacturers of DES should not be rendered immune from all responsibility for injuries caused by the drug because DES daughters could not identify the particular brand of the drug taken by their mothers a generation ago. In order to afford relief to those who could not identify the specific manufacturer, we declared the market share doctrine. We held that if a plaintiff joins in the action the manufacturers of a substantial share of the DES that her mother might have taken, the burden of proof is shifted to defendants to demonstrate that they could not have supplied the DES which caused the injuries. Plaintiff here alleges that if she cannot identify the manufacturer of the DES taken by her mother, she will proceed under the market share doctrine. The complaint charges that defendants expressly warranted that DES was safe to use as a miscarriage preventative and impliedly warranted that it was of merchantable quality, and that they made false representations to plaintiff's mother that DES had been tested and found safe for that purpose, knowing this was untrue. The Court of Appeal held these causes of action could not be maintained under a market share theory because plaintiff will be unable to prove that all manufacturers made the same representations and warranties. It also stated that since plaintiff herself did not ingest the drug, difficult questions would arise as to whether she should be allowed to rely on misrepresentations and breaches of warranty allegedly made to her mother. Plaintiff urges us to hold that the same policies which led to our modification of the rules of causation and liability in Sindell justify allowing her to demonstrate the elements of breach of warranty and fraud by a showing that all defendants made common misrepresentations concerning the safety and efficacy of DES. (7) In order to prevail in an action for fraud, a plaintiff must show that the defendant made misrepresentations upon which he relied to his detriment, and that such misrepresentations were made with fraudulent knowledge or intent. (Civ. Code, §§ 1572, 1709, 1710). [13] (8) These requirements present formidable problems of proof for a person in plaintiff's position. She would be required to show that misrepresentations were made to her, and that she relied on them to her detriment. Although there is authority for the proposition that the reliance of a patient's physician on misrepresentations and warranties of a drug company will satisfy the reliance element in warranty and fraud actions ( Toole v. Richardson-Merrell, Inc. (1967) 251 Cal. App.2d 689, 707 [60 Cal. Rptr. 398, 29 A.L.R.3d 988), it is plaintiff and not her mother who brings the present suit. She seeks to avoid this dilemma by asserting that while she was in utero her mother was her agent for the purpose of receiving and relying on representations made by the manufacturer of DES to her mother's doctor. Even if we were inclined to allow the piling of one fictional concept on another in this manner, plaintiff would still be unable to make out a case of fraud on a market share theory, for she must show not only the fact that common representations were made by defendants but also the state of mind or knowledge of the defendant making them. Plaintiff does not suggest any means by which such matters can be demonstrated without reference to the state of mind of a particular manufacturer, nor can we conceive of any. (9) An action for breach of express warranty requires that the seller of goods conform to his promises concerning them (Cal. U. Com. Code, § 2313, subd. (1)(a)), and may also require reliance on the promise by the plaintiff ( Hauter v. Zogarts (1975) 14 Cal.3d 104, 115-116 [120 Cal. Rptr. 681, 534 P.2d 377, 74 A.L.R.3d 1282]). An implied warranty that goods are fit for the ordinary purposes for which such goods are used arises from a contract of sale (Cal. U. Com. Code, § 2314, subd. (2)(c)); such a warranty does not require an express promise by the seller ( Hauter, supra, at p. 117). (10) Plaintiff's breach of warranty claims are inconsistent with our determination on the issue of strict liability for design defects. We have concluded above that a manufacturer of prescription drugs is not strictly liable for injuries caused by such a defect that is neither known nor knowable at the time the drug is distributed. To hold nevertheless that the manufacturer's representation, express or implied, that a drug may be prescribed for a particular condition amounts to a warranty that it is fit for and will accomplish the purpose for which it is prescribed (Cal. U. Com. Code, §§ 2314, subd. (2)(c), 2313, subd. (1)(a)), and to allow an action for personal injury for the breach of such warranties, would obviously be incompatible with our determination regarding the scope of a drug manufacturer's liability for product defects. We hold, therefore, that a plaintiff who proceeds on a market share theory may not prosecute a cause of action for fraud or breach of warranty. [14]