Opinion ID: 174747
Heading Depth: 2
Heading Rank: 2

Heading: Liability of Bard/Davol Under the Post-Sale Failure to Warn Theory

Text: Next, Campbell argues that a genuine issue of material fact remains as to whether Bard/Davol is liable under a post-sale failure to warn theory. The district court granted summary judgment in favor of Bard/Davol with respect to Campbell's post-sale failure to warn claim, reasoning that Arkansas has not adopted this theory of liability, and there is no evidence of any intent to do so. The district court also noted that Campbell's claim would fail on the merits, even if the theory of liability were adopted by Arkansas law. The post-sale failure to warn theory of liability for successors, as set forth by the Restatement (Third) of Torts, provides: (a) A successor corporation or other business entity that acquires assets of a predecessor corporation or other business entity ... is subject to liability for harm to persons or property caused by the successor's failure to warn of a risk created by a product sold or distributed by the predecessor if: (1) the successor undertakes or agrees to provide services for maintenance or repair of the product or enters into a similar relationship with purchasers of the predecessor's products giving rise to actual or potential economic advantage to the successor, and (2) a reasonable person in the position of the successor would provide a warning. (b) A reasonable person in the position of the successor would provide a warning if: (1) the successor knows or reasonably should know that the product poses a substantial risk of harm to persons or property; and (2) those to whom a warning might be provided can be identified and can reasonably be assumed to be unaware of the risk of harm; and (3) a warning can be effectively communicated to and acted on by those to whom a warning might be provided; and (4) the risk of harm is sufficiently great to justify the burden of providing a warning. Restatement (Third) of Torts: Products Liability § 13 (1998). It is undisputed that Arkansas law has not adopted this theory of liability. Generally, it would be the duty of this court to predict whether the Arkansas Supreme Court would recognize the post-sale failure to warn theory of liability. See Progressive N. Ins. Co. v. McDonough, 608 F.3d 388, 390 (8th Cir. 2010). However, the court need not engage in such speculation because the facts of this case do not support the application of the theory. Campbell has not set forth any facts creating a genuine issue of material fact as to whether Bard/Davol agreed to provide services for the maintenance or repair of the Kugel Hernia Patches that were sold by Surgical Sense, prior to the execution of the Asset Purchase Agreement. [5] The facts presented to the district court demonstrated that there was no contractual relationship to provide services whatsoever between Bard/Davol and the customers who purchased Kugel Hernia Patches from Surgical Sense. The crucial element necessary to establish a duty to warn is the `continuation of the relationship between the successor and the customers of the predecessor.' Tucker v. Paxson Mach. Co., 645 F.2d 620, 626 (8th Cir.1981) (quoting Gee v. Tenneco, Inc., 615 F.2d 857, 866 (9th Cir.1980)). Because Campbell has not set forth or alleged any facts demonstrating a contractual relationship to provide services between Bard/Davol and Surgical Sense's customers, she cannot establish a cause of action against Bard/Davol for post-sale failure to warn, regardless of whether the tort is recognized by Arkansas law. Accordingly, the district court did not err in granting summary judgment in favor of Bard/Davol on Campbell's post-sale failure to warn claim.