Court Opinion

ID: 8967634
Source: CourtListenerOpinion
Date Created: 2022-11-27 10:14:13.643615+00
Date Added: 2024-06-11T17:10:21.582014
License: Public Domain

NOONAN, Circuit Judge,
concurring and dissenting:
I agree with the court that Goodyear cannot be held liable for the injuries in this case under a warranty theory, an agency theory, or as one “putting out” a product under section 400 of the Restatement (Second) of Torts. I also agree with the court that it is appropriate to certify a question to the Supreme Court of Arizona. However, the court’s phrasing of the question is too narrow.
In 1964 the American Law Institute adopted § 402A of the Restatement (Second) of Torts. It provided that the seller of a product in a defective condition unreasonably dangerous to the users was liable for the physical harm caused by the product to the ultimate users if the seller was in the business of selling the product and it was expected that the product would reach the user without substantial change in the condition in which it was sold. The rule applied although the user was not in any contractual relation with the seller.
The rationale for the rule was that “by marketing his product for use and consumption” the seller had undertaken a special responsibility toward the user; that the public in buying goods where it was forced *1240to rely upon the seller had a right to expect that “reputable sellers” would stand behind their goods; and that the burden of accidental injuries caused by such products should be placed “upon those who market them.” Restatement (Second) of Torts § 402A comment c (1964).
Arizona adopted the Restatement in 1968. O.S. Stapley Co. v. Miller, 103 Ariz. 556, 447 P.2d 248 (1968). The court reaffirmed its commitment to the Restatement in 1972. Tucson Industries, Inc. v. Schwartz, 108 Ariz. 464, 501 P.2d 936 (1972). The court declared, “Strict liability is a public policy device to spread the risk from one to whom a defective product may be a catastrophe to those who marketed the product, profit from its sale and have the know-how to remove its defects before placing it in the chain of distribution.” Id. at 467-68, 501 P.2d at 939-940.
In 1976 Arizona codified the law to a degree by providing a statute of limitations, affirmative defenses, a rule as to indemnification, a rule as to the contents of the complaint, a rule as to evidence, and certain definitions. Ariz.Rev.Stat.Ann. §§ 12-681 to 12-686. “The previously existing common law of products liability” was “modified” only to the extent thus provided. Id. at § 12-682. Nothing in the statute changed the rationale for imposing product liability.
Since the adoption of the rule, Arizona has imposed product liability on a variety of actors other than those meeting the precise statutory definition of manufacturer or seller. As is observed by this court, those held liable have included a lessor, a dealer in used goods, a jobber, a distributor and a packager. The common thread has been that each of those held liable has been in the chain of distribution.
In roughly a quarter of a century since section 402A made its appearance, its reach has been extended by many states. We would be a part of that trend were we to hold that Arizona would do so in this instance were this case before one of its courts.
Each state has an incentive to make available to its inhabitants all the possible benefits of section 402A’s coverage. To do otherwise is for the state to incur the risk of depriving a potential insured in the state of the coverage for which he or she has paid by reason of the enterprise already having incorporated an insurance premium of this kind in the price of its product.
The question certified by this court assumes that “the precise issue” presented by this appeal has not been decided by an Arizona court. This court arrives at this phrasing of the issue by singling out a single aspect of Goodyear’s relation to Goodyear GB — that of trademark licensor. This narrow focus on a single portion of the relationship misses the point of the Arizona doctrine and fails to respond to the rationale of the rule.
The question that should be certified to the Supreme Court of Arizona is: Is a company liable in Arizona under § 402A of the Restatement (Second) of Torts for the tort of a company that it licenses to manufacture in strict accordance with its formulas, specifications and restrictions, using only materials approved by the licensor, with the licensor having the right to inspect the plant and samples produced by the licensee; with the licensor doing all basic product research for the licensed product, with quality control being the responsibility of the licensor; with the licensor warranting the quality of the licensee’s product; with the licensor advertising the licensee’s product; with the licensor profiting from its charges to the licensee; with the li-censor selecting the corporate board of the licensee; with the licensor deciding how much capital will be allocated to the licensee; and with the licensor owning all the common stock of the licensee?
I do not believe the Supreme Court of Arizona is bound to respond mechanically and literally to the question certified to it but may reply as it finds appropriate after setting the question certified within the context of the case in which it arises.