Opinion ID: 852959
Heading Depth: 3
Heading Rank: 2

Heading: Problems of Causation and Damages

Text: The City's complaint identifies the damages it seeks as expenses in trying to abate the nuisance and damages caused by the defendants' wrongful design, manufacture, marketing advertising, distribution and sale of handguns. The specific items identified in the complaint are police and law enforcement services, additional security in and upon public facilities, emergency medical services, pension benefits, disability benefits, workers' compensation benefits, and losses in tax revenues and property values.
Defendants first argue that the items as damages the City seeks are not recoverable as a matter of law because they fall under the category of municipal costs incurred in the course of ordinary governmental functions. Although there is no Indiana precedent, defendants contend these items are not recoverable at common law. Defendants cite Dist. of Col. v. Air Florida, Inc., 750 F.2d 1077, 1080 (D.C.Cir.1984), and City of Flagstaff v. Atchison, Topeka & Santa Fe Ry. Co., 719 F.2d 322, 323-24 (9th Cir.1983), for the proposition that activities carried on by government are not components of compensable damages. The defendants point out that the items cited by the City are all in the general category of additional services investigation, response to crimes, treatment of victims, services to children, etc.of the type government provides to the general public. The doctrine that a tortfeasor is not liable for the cost of municipal services in responding to an accident has been addressed only infrequently. Then-Judge Kennedy explained it as based on the nature of the entity seeking recovery, not on remoteness of the damage item from the tortfeasor's act. City of Flagstaff, 719 F.2d at 324. Thus, the costs of responding to a single accident or fire may be quantifiable, at least in part, and may satisfy ordinary requirements of proximate cause. The municipal costs doctrine would nevertheless deny recovery on the basis in part that all expect the government to provide emergency services, and if any change is to come in that doctrine it should originate with the legislature. Id. The damages the City seeks for the most part are in the nature of costs of responses to incidents of gun use. There is an inherent issue in any attempt to recover cost of municipal government in responding to even a single incident such as an accident. Even if it is appropriate to charge the arsonist with cost of a run by the fire department, one can fairly debate to what extent these are recoverable. The municipality incurs direct costs (gas for the fire truck, the water bill, etc.), allocated costs of preparedness that would be incurred and are not directly attributable to the incident (depreciation on the firehouse, salaries of administrative personnel, etc.), and some costs that are arguably in either category (salaries of the firemen who respond). In addition to these issues, the City's claims here raise a second level of complexity because they also present the broader issue of identifying the costs attributable to whole classes of incidents, and then allocating those costs among the various contributing factors, only one of which is the acts of the alleged tortfeasor. Despite these complexities there may be merit in some claims by the City for damages to its property from the use of an illegally purchased weapon, and municipal costs may be recoverable under conventional tort disputes in some circumstances. The City's broad description of its damages suggests an aggregation of disparate claims for response costs under generalized allegations. It appears to include many fact patterns that presumably do not support a claim for damages. As explained below, these and other issues may prevent recovery of some claimed items of damage, but the mere fact that the City provides services as part of its governmental function does not render the costs of those services unrecoverable as a matter of law. We do not agree that the City, as a governmental entity, is necessarily disabled from recovering costs from tortious activity. Rather, we agree with those courts that have rejected the municipal cost doctrine as a complete bar to recovery. See James v. Arms Tech., Inc., 359 N.J.Super. 291, 820 A.2d 27, 49 (App.Div. 2003); Cincinnati v. Beretta U.S.A. Corp., 95 Ohio St.3d 416, 2002-Ohio-2480, 768 N.E.2d 1136, 1149 (2002).
The defendants point out that at the time a gun is used in a crime it is no longer in the control of any defendant. Moreover, a wide variety of conditions, many involving no fault of any defendant, can lead to use of a firearm in some unlawful manner. Under standard negligence doctrine, in order for a defendant to be liable for a plaintiff's injury, the defendant's act or omission must be deemed to be a proximate cause of that injury. Cowe v. Forum Group, Inc., 575 N.E.2d 630, 635 (Ind.1991), citing Prosser and Keeton on the Law of Torts § 41 at 263-66 (5th ed.1984). Proximate cause in Indiana negligence law has two aspects. The first causation in factis a factual inquiry for the jury. If the injury would not have occurred without the defendant's negligent act or omission, there is causation in fact. Cowe, 575 N.E.2d at 635. A second component of proximate cause is the scope of liability. That issue, which is also for the trier of fact, turns largely on whether the injury is a natural and probable consequence, which in the light of the circumstances, should have been foreseen or anticipated. Bader v. Johnson, 732 N.E.2d 1212, 1218 (Ind.2000). Under this doctrine, liability may not be imposed on an original negligent actor who sets into motion a chain of events if the ultimate injury was not reasonably foreseeable as the natural and probable consequence of the act or omission. Havert v. Caldwell, 452 N.E.2d 154, 158 (Ind.1983); Control Techniques, Inc. v. Johnson, 762 N.E.2d 104, 108 (Ind.2002). Under comparative fault, the trier of fact can allocate fault to multiple contributing factors based on their relative factual causation, relative culpability, or some combination of both. Control Techniques, Inc., 762 N.E.2d at 109; I.C. § 34-51-2-8. A crime involving the use of a gun may be attributable in part to an unlawful sale, but it also requires an act on the part of the criminal. Among the defendants, the retailers are the closest link in the causal chain to the criminal act. But even these dealers may not be the sole cause of the injuries from the illegal use of the weapon, and in many cases will not bear any share of the fault. As illustrated by the statistics the City cites in its complaint, a significant amount of time often passes between the sale of a handgun and the time a crime is committed using the weapon. [16] A wide variety of intervening circumstances may contribute to the ultimate unlawful use. And of course lawfully purchased handguns are also used in crimes, so any attempt to recover costs attributable to unlawfully distributed weapons must address that fact. We agree with the trial court that legislative policy permitting lawful distribution of guns is relevant here. As a matter of law, in the absence of other facts, it is not a natural and probable consequence of the lawful sale of a handgun that the weapon will be used in a crime. In this procedural posture the City cites no specific transaction in which its damages are traceable to use of a gun obtained in an unlawful sale. The City's general description of its damages would presumably embrace a vast number of different unspecified claims arising from a variety of widely different circumstances. Much of the costs that are within the broad terms of the City's complaint are undoubtedly attributable to use of lawfully distributed guns. Even an unlawfully sold weapon may nevertheless be acquired by a licensed owner before its use in a crime. In some cases the fault allocated to the user may overwhelm or even eliminate fault of the seller. And so on. Because of these many variables, any particular crime may not be attributable to an unlawful sale at all. And even if an unlawful sale did contribute in part to some injuries, the relationship of each defendant to the sale may vary, and the vast majority of defendants will have no relationship to the transaction that placed the gun in the hands of its user. The conclusory allegations of the complaint leave much unanswered. For the reasons cited, there may be substantial barriers to recovery of any or all of these damages. However at this pleading stage we have nothing more than the City's allegation that it has incurred damages in these general categories. There may indeed be substantial issues of proximate cause, or, as some courts put it, remoteness of damage. City of Cincinnati, 768 N.E.2d at 1144; People v. Sturm, Ruger & Co., 309 A.D.2d 91, 761 N.Y.S.2d 192, 197 (N.Y.App.Div.2003). However, we cannot say as a matter of law that no items are recoverable. Resolution of these issues must await the proof offered to substantiate each claimed item. Here we have bald allegations of liability and a claim of resulting damages. That is sufficient to state a claim. Whether the claim can be substantiated is an issue for another day.
The City seeks to overcome difficulties in proof of damages by relying on a market share theory. This approach to allocation of liability has not been adopted in Indiana. To the extent market share has been applied, it has been used as a means of allocating damages among a group of defendants when it is known that one of them is liable to the plaintiff, but it cannot be established which of them caused any particular plaintiff's injury. For example, in the leading case, Sindell v. Abbott Laboratories, 26 Cal.3d 588, 163 Cal.Rptr. 132, 607 P.2d 924 (1980), one of the many manufacturers of a fungible product was known to be the source of the product alleged to cause the plaintiff's injuries, but there was no means to identify which of the manufacturers produced the particular product that injured a specific plaintiff. In this circumstance, some jurisdictions have allowed recovery against the group of potential sources of the defective product, and allocated the damages in proportion to each manufacturers' sales in the relevant time period. Where market share theory has been adopted, the defendants denied any causation, but there was no claim that the injury was solely attributable to other wrongful acts aside from the product defect. Here, in contrast, many injuries from crimes involving guns are plainly not attributable in any respect to any unlawful sale of the weapon, and all are caused at least partly by substantial wrongful conduct by non-parties. Whatever the merits of market share in other contexts, we do not believe it is properly applied in this situation involving such a wide mix of lawful and unlawful conditions as well as many potentially intervening acts by non-parties.
The City asserts negligence per se, arising from an unlawful sale and cites Rubin v. Johnson, 550 N.E.2d 324 (Ind.Ct.App.1990), for the proposition that the criminal use of a firearm does not constitute an intervening cause. Under comparative fault, the City is correct that a subsequent misuse of the gun does not necessarily extinguish liability of one who negligently furnished it. Estate of Heck, 786 N.E.2d at 271; Control Techniques, Inc., 762 N.E.2d at 108. The problem with the City's claim, however, is not a failure to allege negligence. Rather it is failure to identify any common relationship between the alleged acts of negligence and the various injuries from criminal use of guns. Negligence per se is a doctrine that supplies liability, but does not embrace damages. In short, to the extent the City seeks to recover damages it must do so by proof of factual causation, subject to comparative fault and proximate cause, just as any other negligence claim. Those issues remain for trial.
The City also seeks to recover for the harm caused by the negligent sale of handguns independently from the harm caused by the use of handguns. This alleged injury removes several links from the causal chain needed to establish harm from the use of the gun. In addition to the costs in investigating and attempting to prevent crimes committed with handguns, the City also seeks recovery for the harm caused directly to it by the acts of illegal handgun sales. Examples of these damages are costs of investigations of illegal sales and services to juveniles who posses firearms. The City claims that the costs it seeks to recover are analogous to cleanup costs of a toxic waste spill which are recoverable even in jurisdictions that follow the no-recovery-of-municipal-costs rule. See City of Flagstaff, 719 F.2d at 324. Certainly a unit of government has a civil remedy for injury to its property. City of Marion v. Taylor, 785 N.E.2d 663, 664-65 (Ind.Ct.App.2003) (suing for damages to stoplight). Cleanup costs are often in the nature of abatement costs. They restore the situation to the pre-nuisance status. The damage items the City identifies as arising from the sales are generally additional police efforts and services to juvenile buyers. These may present insurpassable issues of causation. Claims with fewer intervening factors have been regarded as simply too complex to permit proof of damages. See Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707, (1977) (rejecting antitrust price fixing damages sought by buyers from customers of the price fixers as too speculative because it would require proof of the extent to which the inflated price would be passed on to buyers in the resale market); Camden County Bd. of Chosen Freeholders v. Beretta U.S.A. Corp., et al., 123 F.Supp.2d 245, 263 (D.N.J.2000) (applying reasoning of Illinois Brick to proximate cause in municipal handgun case). However, once again we are presented with a motion to dismiss a conclusory allegation of a complaint. Whether the proof at trial will be sufficient to overcome these issues remains to be seen.
For the reasons given, we agree that proof of damages from any specific use of an unlawfully sold weapon, or from the sale itself, may turn out to be so inextricably intertwined with other factors that as a matter of law the City may have difficulty in establishing a claim for money damages. However, precisely because there may be no effective damage remedy we conclude that the City has stated a claim for injunctive relief. Tort law has historically viewed injunctive relief as available only if there is no adequate remedy at law, i.e. if there is no appropriate money damage award to compensate the victim. Dobbs, Law of Remedies, § 2.5, at 123, (2d ed.1993). We think the City's negligence claim for injunctive relief remains viable to the extent it alleges injury caused by the negligent sale of handguns. The City has stated facts that, if proven, support the conclusion that it has incurred some expenses as the result of negligent conduct on the part of the defendants and will incur more in the future. Although the allocation and evaluation of monetary damages may prove to be unquantifiable, proof of some unknown but material additional cost incurred by the plaintiff is sufficient for injunctive relief. Law of Remedies, § 2.5(2) at 131 and § 5.7(2) at 763. Injunctive relief is not as speculative as monetary damages and does not involve the apportionment problems that come with a reward of monetary damages. Even if the City ultimately fails to establishing its action for damages, an equitable action for injunctive relief may still lie. NAACP v. AcuSport, Inc., 271 F.Supp.2d 435, 493 (E.D.N.Y.2003). This is simply an application of the widely accepted doctrine that injunctive relief is available when a party suffers economic harm that cannot necessarily be quantified. See Barlow v. Sipes, 744 N.E.2d 1, 7, 13 (Ind.Ct.App.2001) (in a tort case involving intentional interference with a business relationship and defamation, injunctive relief was necessary because money damages cannot be calculated with any predictability or certainty); Daugherty v. Allen, 729 N.E.2d 228, 235 (Ind.Ct.App.2000) (injunctive relief is not appropriate when monetary damages make a party whole, but injunctive relief is available when monetary damages cannot be adequately awarded); Robert's Hair Designers v. Pearson, 780 N.E.2d 858, 865 (Ind.Ct.App.2002) (injunctive relief available to enforce non-competition agreement even if economic loss was not quantifiable).
The City also asserts claims of misleading and deceptive advertising and marketing of guns. This is alleged in support of both the nuisance and negligence claims. Specifically, the City alleges that guns are presented as adding to a homeowner's safety when in fact the opposite is true. Like Count III, discussed below, these allegations appear to apply equally to lawfully and unlawfully distributed guns. The City alleges that it incurs additional costs for treatment of both intentional and accidental gunshot injuries as a result of the increased placement of guns produced by the deceptive marketing practices. The City attributes some of its incurred municipal costs to these factors. For the same reasons applicable to the allegation of contributing to unlawful sales practices, we agree that these claims, if proven, state a claim for injunctive relief based on an action for public nuisance and negligence theories. The money damages claim may suffer from the same complexity and multiplicity of factual allegations that could bar damages from other allegations, but for the reasons already given, these issues do not warrant dismissal of the complaint.