Court Opinion

ID: 9464277
Source: CourtListenerOpinion
Date Created: 2023-08-04 23:29:30.967143+00
Date Added: 2024-06-11T17:38:32.966319
License: Public Domain

*450FAIRCHILD, Chief Judge,
dissenting.
In this ease, as in Leannais v. Cincinnati, Inc., et al., No. 77-1066 (7th Cir. October 18, 1977), this court assumes that a state, here Indiana, will apply to strict products liability traditional limitations upon liability of a successor company for injuries caused by its predecessor to four circumstances: (1) when the successor expressly or implicitly agrees to assume liability, (2) when the acquisition was by merger or consolidation of the companies, (3) when the successor is a “mere continuation” of the predecessor, or (4) when the acquisition had a fraudulent purpose to allow the predecessor to escape liability for its obligations. This rule originated long before the development of strict liability in tort and, as I noted in my dissent in Leannais, it is not compatible with full effectuation of the principle underlying strict liability.
Indiana, whose law controls this case, is committed to the policy of strict liability in tort. Ayr-Way Stores, Inc. v. Chitwood, 261 Ind. 86, 300 N.E.2d 335 (1973); Perfection Paint v. Konduris, 147 Ind.App. 106, 258 Ind.App. 681 (1970); Cornette v. Searjeant Metal Products, Inc., 147 Ind.App. 46, 258 Ind.App. 652 (1970). See also Greeno v. Clark Equipment Co., 237 F.Supp. 427 (N.D.Ind.1965). In a recent decision, one of its courts explained:
Justifications for this form of strict liability generally recognize . . . that the manufacturer and supplier can best bear and spread the losses caused by their defective products. Presumably an “insurance factor” is, or can be, reflected in the price of [the] goods. . To the extent that these policies underpin the rule of law, traditional distinctions between purchasers, users and bystanders appear superfluous. Chrysler Corp. v. Alumbaugh, 342 N.E.2d 908, 916, modified on other grounds, 348 N.E.2d 654 (Ind.App.1976).
Thus, as in Leannais, the state courts have made a strong commitment to the policy underlying strict products liability, and have not produced any decision applying the traditional limitations upon successor liability to strict liability for harm caused to the user of an unreasonably dangerous product.
In these circumstances, a court in our position, with the duty to apply Indiana law, should apply the rule it considers the soundest.