Opinion ID: 774926
Heading Depth: 1
Heading Rank: 2

Heading: GACS's Appeal

Text: 9 Following the jury verdict, GACS moved for judgment as a matter of law, or alternatively for a new trial, which the district court denied. On appeal, GACS argues that the compensatory damages cannot stand as a matter of law under either the negligence claim or the products liability claim because any danger presented by the device was open and obvious. It argues that the punitive damages cannot stand because there was no evidence of evil motive. Finally, GACS argues that the district court erred in denying its motion for a new trial based on improper jury instructions related to Ford's duty to mitigate damages.
10 We review de novo the district court's denial of GACS's motion for judgment as a matter of law. Judgment as a matter of law is proper only when there is a complete absence of probative facts to support the conclusion reached so that no reasonable juror could have found for the nonmoving party. Foster v. Time Warner Entm't Co., L.P., 250 F.3d 1189, 1194 (8th Cir. 2001) (internal quotations and citations omitted). The parties agree that Missouri law controls this case, which reaches us by reason of the parties' diverse citizenship. 11 GACS argues that the alleged danger-which it defines as requiring excessive force to operate the ratchet-was open and obvious because Ford had used the ratchet and applied similar force thousands of times over his 28 years as an automobile hauler. GACS argues that the openness and obviousness of the danger precludes liability as a matter of law. In the context of a Missouri products liability claim, however, the openness and obviousness of a defect does not automatically preclude judgment. The Missouri legislature abolished contributory fault for products liability cases, replacing it with pure comparative fault. See Miller v. Varity Corp., 922 S.W.2d 821, 826 (Mo. Ct. App. 1996) (discussing the effect of Missouri's adoption of comparative fault on products liability claims involving open and obvious dangers). The plaintiff's knowledge of a danger is one of the enumerated items of fault to be compared in a products liability case. See Mo. Rev. Stat. § 537.765(3)(3); see also Miller, 922 S.W.2d at 826 (holding that the open and obvious nature of a defect does not bar recovery but is appropriately considered in apportioning fault). Thus, under Missouri products liability law, the openness and obviousness of any alleged design defect in the ratchet does not preclude recovery as a matter of law. See Anderson v. F.J. Little Mach. Co., 68 F.3d 1113, 1117 & n.2 (8th Cir. 1995) (reversing summary judgment in a products liability case under Missouri law and noting that although the obviousness of a defect is material, it stops far short of compelling judgment for the manufacturer, and indeed demonstrates that a fact finder must consider the issue). 12 GACS's argument that the ratchet was not unreasonably dangerous because the amount of force required to operate the ratchet was known to Ford relies on what is often termed the consumer expectations test for determining what is unreasonably dangerous. 2 The Missouri courts have repeatedly declined to adopt a test-the consumer expectations, risk-utility, 3 or any other-for determining what is unreasonably dangerous. Rather, what is unreasonably dangerous needs no judicial definition and is left as an ultimate fact question for the jury, to be decided by allowing the jury to apply 'their collective intelligence and experience to the broad evidentiary spectrum of facts and circumstances presented by the parties.' Rodriguez v. Suzuki Motor Corp., 996 S.W.2d 47, 65 (Mo. 1999) (en banc) (quoting Newman v. Ford Motor Co., 975 S.W.2d 147, 154 (Mo. 1998) (en banc)); see also Drabik v. Stanley-Bostitch, Inc., 997 F.2d 496, 506 (8th Cir. 1993) (holding that plaintiff's knowledge of danger posed by nail gun did not preclude jury verdict on products liability claim under Missouri law); Miller, 922 S.W.2d at 825-26 (affirming jury verdict for plaintiff on products liability claim based on defendant's failure to equip tractor with a roll over protection system). Missouri courts prefer to allow litigants 'to argue that the utility of a design outweighs its risks, or that consumer expectations were violated, or any other theory of unreasonable dangerousness supported by the evidence....' Rodriguez, 996 S.W.2d at 65 (quoting Newman, 975 S.W.2d at 154). 13 Ford offered evidence of GACS's awareness of safer alternatives to the traditional manual ratchet system, particularly the quick release ratchet that GACS developed in 1979 long before Ford's injury. There was also evidence that injuries from the force required to tie and untie vehicles were a concern in the industry and that the quick release ratchet would eliminate the high force levels needed to untie a vehicle, the same activity Ford was performing when he was injured. GACS offered evidence of Ford's extensive experience tying and untying vehicles and his knowledge of the risks associated with using the ratchet. Ford's expert opined that the levels of force required to properly tie down a vehicle were unreasonably dangerous, while GACS's expert testified that they were not. The jury instruction tracked the statute, instructing the jury that the ratchet system had to be in a defective condition unreasonably dangerous when put to a reasonably anticipated use before GACS could be held strictly liable. (J.A. at 1235.) The instruction was broad enough to allow the jury to apply either theory argued by the parties-consumer expectations as argued by GACS or risk-utility as argued by Ford. Although both parties offered evidence to refute the other's theory, the jury was apparently persuaded by Ford's argument of the evidence. On these facts, we cannot say that no reasonable juror could have found for Ford. The district court correctly rejected GACS's motion for judgment as a matter of law on Ford's products liability claim. 14 The jury returned a special verdict, finding GACS liable under both the negligence and the products liability theories. It assessed GACS's fault at 70% and Ford's fault at 30% under both theories. The jury valued Ford's compensatory damages at $150,000, which the district court apportioned based on the jury's fault allocations. Because we hold that the products liability claim was properly submitted to the jury and the verdict is supported by the evidence, we need not reach GACS's argument concerning the negligence claim. The products liability finding supports the damages award, regardless of the outcome on the negligence claim.
15 The test for punitive damages in Missouri is a strict one. Drabik, 997 F.2d at 510. Punitive damages may be awarded in a negligence case only if the defendant knew or had reason to know a high degree of probability existed that the action would result in injury. Letz v. Turbomeca Engine Corp., 975 S.W.2d 155, 164 (Mo. Ct. App. 1997) (opinion adopted & reinstated after retransfer Sept. 29, 1998). Before punitive damages are warranted in a products liability case, the defendant must have placed an unreasonably dangerous product in commerce with actual knowledge of its defect. Id. at 164-65; see also Drabik, 997 F.2d at 510. Punitive damages are appropriate under either theory of recovery only if the defendant showed a complete indifference to or conscious disregard for the safety of others. Letz, 975 S.W.2d at 165. Ultimately, the defendant must have acted with some degree of wantonness or bad motive. Drabik, 997 F.2d at 510. 16 GACS was aware that the level of force used on the ratchets resulted in some injuries to drivers. GACS worked to reduce those injuries by developing alternative systems for securing automobiles that did not require excessive force to operate, including the quick release ratchet. Though it did not implement those other designs for various reasons, the fact that it worked to design a safer system belies the level of reckless indifference or conscious disregard for the safety of others necessary to support an award of punitive damages. See id. 17 A manufacturer does not necessarily act with the requisite wantonness to support punitive damages by continuing to manufacture a product with the knowledge of some injuries. [T]he defendant must be aware of unreasonable danger, not just any danger. Id. In 1990, Complete Auto Transit employees reported 494 total injuries from tying or untying automobiles, 255 of which resulted in lost time. Employees reported a total of 277 injuries in 1991, of which 248 resulted in lost time. GACS's president testified that these numbers, which resulted in an injury.001% of the times the ratchet was used, led him to believe that the ratchet was not inherently dangerous. Although Ford countered that based on these same numbers, an individual driver had a 10% chance of being injured in a given year, these number games do not establish that GACS was aware of an unreasonable danger to the driver. 18 The safety of a product must also be weighed against its utility. See id. at 511 (noting that many products, such as knives or nail guns, have a certain degree of danger that is outweighed by the product's utility). An acceptable automobile tie down system must keep the automobiles from coming loose from the trailer and endangering other travelers as well as secure the automobiles without damaging them. GACS manufactured its trailers primarily to transport GM automobiles. At the time of Ford's injury, the chain and ratchet system, which was standard in the industry, was the only method for securing automobiles that GM had approved. We do not suggest that a manufacturer may ignore safety concerns based on customer demand, but it does go to the wantonness required for a punitive damages award. See id. at 510 (noting that the fact that the product design was the standard in the industry was relevant to show that [the defendant] was not willfully indifferent). On these facts, there simply is not the evidence of evil motive or reckless disregard by GACS necessary to support a punitive damages award. See, e.g., Lopez v. Three Rivers Elec. Co-op., Inc., 26 S.W.3d 151, 160 (Mo. 2000) (en banc) (comparing the defendant's conduct to the Missouri Supreme Court's classic example of a person firing a rifle into a moving passenger train as the level of knowledge of a high degree of probability of injury required to support punitive damages). GACS is entitled to judgment as a matter of law on the punitive damages claim.
19 GACS's final point on appeal is that the district court erred in failing to submit two proposed jury instructions involving Ford's failure to mitigate his damages by seeking other employment. We review the district court's refusal to submit a requested instruction to the jury for abuse of discretion. St. Jude Med., Inc. v. Lifecare Int'l, Inc., 250 F.3d 587, 594 (8th Cir. 2001). [R]review is limited to whether the instructions, viewed on the whole, fairly and adequately represent the evidence and applicable law in light of the issues presented to the jury in a particular case. Id. (internal quotations and citations omitted). Because this is a diversity case, the substance of the jury instructions must fairly and adequately represent Missouri law. Wheeling Pittsburgh Steel Corp. v. Beelman River Terminals, Inc., 254 F.3d 706, 711 (8th Cir. 2001). 20 Under Missouri law, comparative fault encompasses a plaintiff's unreasonable failure to mitigate his damages. See Mo. Rev. Stat. § 537.765.3(6); Love v. Park Lane Med. Ctr., 737 S.W.2d 720, 724 (Mo. 1987) (en banc). To be charged to the jury, an issue submitted in an instruction must be supported by substantial evidence from which the jury reasonably could find such issue. Kauzlarich v. Atchison, Topeka, & Santa Fe Ry. Co., 910 S.W.2d 254, 258 (Mo. 1995) (en banc) (internal quotations and citations omitted). Because mitigation of damages is an affirmative defense, GACS bears the burden of establishing that Ford could have lessened his damages. Id. at 256. 21 Following Ford's surgery for his torn rotator cuff, Ford's doctor released him to work with restrictions on lifting, which precluded him from returning to his prior position as an automobile hauler. Ford's employer did not offer him any other type of work. Ford ultimately received Social Security disability benefits, workers' compensation, and pension disability benefits following his injury. Ford testified that he did not seek alternative work because he would not be able to find a job that paid as much as he was receiving from these sources, which would have been terminated if he had taken another job. A vocational expert met with Ford in 1999. He reviewed Ford's medical records from the time of the accident and administered various tests to Ford. He opined that given Ford's shoulder impairment, pre-existing breathing problems, advanced age, limited tenth grade education, prior extensive work history exclusively as an automobile hauler, and the restrictions Ford's doctor placed on his lifting, Ford was unemployable, both in 1999 when the expert met with Ford and following the injury. GACS countered only with evidence that Ford did not look for another job and that his doctor released him to some kind of work consistent with the lifting restrictions. It offered no evidence about the job market or any jobs Ford might be qualified to perform. 22 To meet its burden of proof, GACS must show that [Ford] had an opportunity to mitigate and the reasonable prospective consequences. Bus. Men's Assur. Co. of Am. v. Graham, 891 S.W.2d 438, 448 (Mo. Ct. App. 1994). It is not enough for the [defendant] to prove that the plaintiff made no effort to get other employment, but he must go further and prove that such employment could have been secured. Stewart v. Bd. of Educ. of Ritenour Consol. Sch. Dist., R-3, 630 S.W.2d 130, 134 (Mo. Ct. App. 1982) (internal quotations omitted). GACS failed to meet its burden of establishing its affirmative defense of failure to mitigate damages. As such, the district court did not abuse its discretion in refusing the proffered instructions. Cf. Kauzlarich, 910 S.W.2d at 258 (holding that the trial court erred in refusing a mitigation of damages instruction where defendant offered expert testimony of job opportunities in the market place, considering plaintiff's age, education, work experience, and physical limitations; plaintiff had attended over two years of college and worked at a wide variety of jobs; and plaintiff rejected former employer's offer to retrain).