Court Opinion

ID: 9485941
Source: CourtListenerOpinion
Date Created: 2023-08-05 11:34:12.795226+00
Date Added: 2024-06-11T17:51:27.302356
License: Public Domain

HEANEY, Senior Circuit Judge,
dissenting.
I respectfully dissent. The majority has advanced no valid reason to justify setting aside the verdict for compensatory damages and disclosed no sound reason for holding that this record could not justify a properly instructed jury in awarding punitive damages.
I agree that the punitive damage award must be reversed, but only because plaintiffs counsel intimated in his closing argument that other victims of the defective combine would share in the award. This error, combined with the instruction informing the jury that seventy-five percent of the award would be placed in a trust fund to be administered by the district court, may well have misled the jury, causing it to award more in punitive damages than it otherwise would have awarded without the improper argument and unnecessary instruction.1 Thus I would remand to the district court with instructions to retry the punitive damages issue.2
I. Compensatory Damages
I turn first to the decision of the panel majority to set aside the compensatory damage award of $650,000, reduced by the district court to $390,000 to reflect the jury’s verdict that the plaintiff was forty percent at fault for his injuries. I have read and reread the majority opinion with respect to the compensatory damage award. The majority’s only specific objection to this award is that Jury Instruction No. 14 does not correctly reflect Iowa law. The majority errs in this regard.
Jury Instruction No. 14 provided the following:
It is undisputed that there was no warning by the lower cleanout door at the time of the accident. There was a caution decal above the toolbox, which is a few feet away from the lower cleanout door.
Where an adequate warning or direction is given, the seller may reasonably assume that it will be read and heeded. A product bearing a caution or direction, which is safe for use if the caution is followed, is not in a defective condition, nor is it unreasonably dangerous.
It is admitted that when made and sold, the combine had no caution decal on the *515auger housing. If you find a warning was necessary and find that the caution decal over the toolbox was inadequate, either because of its placement or its wording, or that the danger of severe injury at the lower cleanout door was so great that no such caution decal would cure the danger or that the caution could not be followed, then you may find that the product was defective and unreasonably dangerous. If you do not so find, then you may find that the product was not defective or unreasonably dangerous.
At trial, Deere objected to the third paragraph of this instruction, then without the last sentence, as “surplusage” and as commenting on evidence favorable to the plaintiff. Tr. at 2378. On appeal, Deere repeats its trial objection and argues further that the instruction failed to instruct on an open and obvious danger defense and that it confuses two theories of recovery: “Because the failure to warn claim was submitted with the defective design theory, it is not possible to determine on which basis the jury found Deere hable.” Appellant’s Brief at 44.
Deere misses the dispositive Iowa law on this point. Under Iowa strict liability law, “a product, although faultlessly made, may nevertheless be deemed defective so as to subject the manufacturer to strict liability if it is unreasonably dangerous to place the product in the hands of a user without a suitable warning.” LaCoste v. Ford Motor Co., 322 N.W.2d 898, 900 (Iowa Ct.App.1982) (per curiam). Inadequate warning may in fact be the product defect under Iowa law; it need not be a separate cause of action.
Deere further misleads the court by arguing that the instruction should have included the defense that the danger of an auger is open and obvious. The majority also appears to subscribe to this position. Both miss the point: The Deere combine was not unreasonably dangerous because it utilized an auger; it was unreasonably dangerous because of the “alarming propensity for misuse ... in the absence of a proper warning.” LaCoste, 322 N.W.2d at 901. That alarming propensity for misuse in the two-person accident that occurred here is not open and obvious, and it is ludicrous for Deere to suggest it was: Indeed, if that alarming propensity for misuse were open and obvious to Deere, it should have corrected it forthwith. The score of accidents occurring on this same combine in nearly identical circumstances proves that unreasonably dangerous defect.3
The majority further errs when it concludes that “[t]his instruction permitted the jury to find that the product was defective and unreasonably dangerous by reason of inadequate decal warning alone.” Supra at 504. As noted above, an inadequate warning may indeed render a product defective and unreasonably dangerous, but the jury in this case first had to find that the “warning was necessary” because of the inherent danger of the product. Only after it found that a suitable warning was necessary could it find Deere’s decal inadequate — and only then could it find the combine defective.
The majority also finds that Instruction 14 did not give the jury any option to consider additional matters such as all the warnings given to Burke and his general knowledge and experience. Id. The jury was, however, properly instructed to consider assumption of risk, comparative fault, Burke’s awareness of the danger of the product, proximate cause, and warnings disregarded by Burke. See Jury Instructions Nos. 12, 19, 24, 25, 26, and 27. When reviewing the charge to a jury, “[a]ll instructions must be read and construed together, not piecemeal or in artificial isolation.” Sanders v. Ghrist, 421 N.W.2d 520 (Iowa 1988); accord Grogan v. Garner, 806 F.2d 829, 836 (8th Cir.1986). I believe that the instructions as a whole fairly and adequately presented the substantive Iowa law in this case and were neither misleading nor confusing. The jury’s compensatory award reflects its own apt understanding of the case. It found Burke forty percent re*516sponsible for his injuries, and there has been no suggestion that the award was excessive.
In a final, conclusory effort to strengthen its argument with respect to the reversal of the compensatory damage award, the majority states that the compensatory verdict was “tainted by the improper admission of evidence and the submission of erroneous legal theories to the jury.” Supra at 513. It is difficult to respond to such a generalized allegation except to point to its lack of substance and to reiterate that there was no confusion about evidence or legal theories in the district court during this trial. This case was the second time that the same product, injury, and issues have been tried before the same judge and with representation by the same lawyers. True, the plaintiff and the jury are different, but this jury was not naive: it had the benefit not only of very well versed counsel and court, but even took a trip to the field to study this combine up close and ask questions.
I would add that the majority’s opinion extends an open invitation to Burke to amend his case on remand to include theories of recovery under negligence, and what was once rather a simple case on compensatory damages could evolve into something a good deal more complicated, but with the end result likely being about the same as it was here.
II. Punitive Damages
The panel majority finds several reasons to set aside the punitive damage award: It finds error in a jury instruction, prejudice in several evidentiary rulings, impropriety in closing argument, and insufficient evidence to support any such award in the first place.4 I believe all but one of the majority’s findings are without merit. As I stated above, I would remand to the district court for a retrial on the punitive damage award because I think counsel’s closing argument and the unnecessary instruction from the district court may have prejudicially affected the award. To deny Burke any opportunity to submit the punitive damages issue to the jury is to ignore Iowa punitive damage law, which is fully consistent with decisions of the United States Supreme Court.
A. Jury Instruction No. 36
The majority’s analysis unfortunately goes awry because of considerable confusion about Jury Instruction No. 36 and the applicable Iowa law. Instruction 36 provided that
[t]he legal basis for punitive damages is established in product liability eases where the manufacturer is shown to have knowledge that its product is inherently dangerous to persons or property and that its continued use is likely to cause injury or death, but nevertheless continues to market the product without making timely feasible modifications to eliminate the danger or make adequate disclosure and warning of such danger.
With the exception of the word “timely,” this instruction is a verbatim quote from Fell v. Kewanee Farm Equip. Co., 457 N.W.2d 911, 919 (Iowa 1990) (en banc). The Fell court quoted this language with approval as a proper definition of “willful and wanton disregard for the rights or safety of another” in the context of products liability cases. Id. The majority, presumably applying Iowa law, now concludes that the Iowa Supreme Court, sitting en banc, should have narrowed its analysis.
Deere objected to this instruction at trial because “it is not a statement of duty”; because “it was some dicta, quoting from other treatises”; because there was insufficient evidence for its submission; and because “[i]t’s argumentative and it suggests a plaintiffs theory.” Tr. at 2409-11. Deere’s new and improved argument on appeal is that Instruction 36 “miscomprehends and misapplies lan*517guage from Fell.” Appellant’s Brief at 33. Finally, at oral argument, the objection was further transformed to state that Instruction 36 erroneously creates a “duty to retrofit” in Iowa law.5
The majority, declining to choose an objection, states only that “[w]e agree that the instruction was erroneous under the evidence in this case.” Supra at 509. The majority’s analysis misstates the holding from Fell to conclude that this ease, like Fell, is one in which the evidence was insufficient to present a punitive damages question to the jury. The Fell court was explicit about why the evidence was insufficient in that case:
This is not a case in which [the manufacturer] knew that people were being injured by exposed gears and ignored this knowledge for economic reasons. To the contrary, the evidence shows that [the manufacturer] manufactured and sold thousands of these elevators without a similar accident occurring. Simply put, risk of injury from exposed beveled gears on the elevators was not so great as to make it highly probable that an injury would occur.
Fell, 457 N.W.2d at 920. In the instant case, the risk of injury from the combine defect was sufficiently great to make it highly probable that injuries would occur; at least twenty-six injury-producing accidents did occur, most of which were nearly identical to Burke’s; and there is evidence that Deere knew of the defect and the injuries, but put off a costly retrofit program until the accident reports became increasingly common. Therefore, I conclude that under Iowa law, the district court did not err in sending the question of punitive damages to the jury with Instruction No. 36.
The majority also concludes that “although Instruction 36 is purportedly limited to assessment of punitive damages, we find ... that the jury could easily have viewed the instruction as an invitation to impose liability for failure to retrofit or recall.” Supra at 510. Although not entirely clear, this may be what the majority refers to in its vague discussion of “erroneous legal theories” alluded to above in my discussion of compensatory damages. I cannot agree with the majority’s conclusion. First, the instruction unambiguously states that it concerns the legal basis for punitive damages. Second, the Supreme Court of Iowa does not imply a “duty to retrofit” in the language used; nor do I see how a reasonable jury could squeeze such a meaning from the straightforward language. Rather, it allows a jury to find willful and wanton disregard for the rights and safety of another if a manufacturer continues to sell a product it knows to be dangerous without making appropriate feasible modifications or adequate warnings. The same instruction could have been worded differently in this case without changing its meaning:
The legal basis for punitive damages is established in this ease if Deere is shown to have knowledge that its combine is removing farmers’ arms and that its continued use is likely to continue to remove farmers’ arms, but nevertheless continues to sell the combine without making feasible changes to eliminate the danger of limb removal or at least adequately warning farmers of the danger.
I agree with the Iowa Supreme Court that such an instruction fairly defines “willful and wanton disregard for the rights or safety of another” in the,context of products liability.6 I find no error in the instruction.
*518B. Sufficiency of Evidence
The majority’s theory of this case concludes that the focal point of the defective product inquiry is not the time of sale, but after the caution decal was affixed to the combine. Deere not only does not raise this issue, but vigorously argues that the focal point of the defective product inquiry must be the time of sale. ' Deere’s position is understandable, for by moving up the focal point of the defect inquiry to sometime after the implementation of the decal program, the majority also moves up the threshold of the punitive damages analysis (under its own restrictive theory) to a time when Deere had greater knowledge of the danger of its product and specific notice that the product was removing body parts from unwary farmers in the field.
Thus, even if one. accepts the majority’s ruling that all evidence admissible to prove willful and wanton conduct by Deere must have occurred at or before surrendering control of the combine — and I do not accept that unsupported ruling — then a submissible jury question on punitive damages still is presented by the evidence.
Deere did not mail the caution decal at issue to prior purchasers of the combine until April 1981. But Deere had notice of the first accident occurring with this combine in August 1979. It received another accident notification in February 1980, another in September 1980, and yet another in December 1980. Deere’s Product Safety Committee had suggested a caution decal at a meeting as early as September 1979, and it recommended that the Design Division review the combine for possible changes in April 1980. Despite the timely suggestions of the Product Safety Committee, Deere management dragged its feet until accident reports became increasingly common. And even then, a year after design modifications were first suggested, the decision was made to mail out an inadequate and ineffective caution decal. Evidence also was introduced that Deere held a clinic for custom combiners in March 1981 in Wichita, Kansas, in which it overlooked informing the clinic participants of the danger of the combine design or of the accident reports.
A submissible jury issue for the question whether punitive damages should be awarded under Iowa law need only raise- a material question of fact regarding whether Deere had knowledge that its combine was causing serious injuries and that its continued use was likely to continue to cause injuries, but nevertheless continued to market the combine without making feasible changes to eliminate the danger or at least adequately warning of the danger. Accord Fell, 457 N.W.2d at 919. All the evidence outlined above would be admissible even under the majority’s overly restrictive theory of punitive damages under strict liability. I believe it is sufficient evidence to send that issue to the jury in this case. I would remand to the district court with directions to submit that question to a jury with appropriate and unambiguous instructions.
III. Evidentiary Issues
Concerning the admissibility of contested evidence, the majority correctly rules that evidence of other substantially similar accidents and evidence of subsequent remedial measures was admissible in this case. Indeed, it will again be admissible on retrial. Despite this concession, the majority finds the evidence was nonetheless prejudicial because it was not used correctly: again, the majority errs.
The majority finds an abuse of discretion in the district court’s admission of evidence of subsequent remedial measures, because “the retrofit evidence was admitted as ostensibly relevant to Deere’s state of mind relat*519ing to imposition of punitive damages.” Supra at 507. I cannot agree. The district court’s ruling on the post-trial motions expressly states that post-sale conduct by Deere, over and above that necessary to show the existence of a dangerous defect, was admitted for the limited purpose of impeaching Deere’s testimony that it had taken all reasonable steps to rectify the dangerous situation presented by the combine. Burke v. Deere & Co., 780 F.Supp. 1225, 1245-47 (S.D.Iowa 1991). The district court even takes the trouble to repeat itself: “As previously mentioned, the court did not allow evidence for Deere’s post-sale and post-accident conduct to demonstrate Deere’s state of mind.” Id. at 1256. The majority’s contrary finding seems to challenge the integrity of the district court in a manner I cannot accept.
The majority also rules that because Deere was willing to stipulate to notice of other accidents and the feasibility of subsequent design changes, the evidence of other accidents occurring under substantially similar circumstances could not properly be admitted to prove these issues. Supra at 506. The majority, however, provides no authority for the proposition that the admissibility of evidence is diminished because the opposing party offers to stipulate to issues for which such evidence might be admitted. I believe the appropriate analysis for the admission of such evidence is whether the court abused its discretion — a finding the majority cannot make because there was no abuse. There were twenty-two accidents that occurred under substantially similar circumstances before Burke’s own injury. Notwithstanding, the district court exercised sound discretion and allowed the live testimony- of only five victims of those accidents.
The majority also states that evidence of these other accidents was used in the submission of the punitive damages question to the jury, and that the use of this evidence served to enhance the award of punitive damages. As I stated above, I believe there was error regarding counsel’s closing argument intimation that part of the award of punitive damages would serve to compensate similarly situated victims. The error, however, was the ambiguous and misleading statement of counsel — not the properly admitted evidence of other similar accidents.
IV. Conclusion
. Accordingly, I would reverse the award of punitive damages and remand for a new determination of how much, if any, those dam-agés should be. I must, however, dissent from the holding of the panel majority that today works an injustice by throwing out the baby with the bath water — needlessly reversing the entire trial below on suspect grounds, and erroneohsly redefining the parameters of Iowa products liability law.

. The district court erroneously informed the jury in Question No. 3 of the Special Interrogatories on Punitive Damages that “a portion of the punitive damage award to be fixed by the court' will be paid into a civil trust fund administered by this court” if the jury found the conduct of Deere not directed specifically at Burke. Iowa Code § 668A.1 provides that at least seventy-five percent of such an award "be ordered paid into a civil reparations trust fund administered by the state court administrator.” Although I do not find the present case an appropriate opportunity to resolve the question whether Iowa juries should ever be informed of the destination of such funds, I do think the erroneous information provided in the present case,' along with the argument of counsel, proved prejudicial.

. The majority argues that remand for retrial of the punitive damages issue alone would be impermissible, citing Gasoline Products Co., Inc. v. Champlin Refining Co., 283 U.S. 494, 51 S.Ct. 513, 75 L.Ed. 1188 (1931). The Gasoline Products Court did not prohibit such a practice. It stated specifically that the Seventh Amendment does "not require that an issue once correctly determined, in accordance with the constitutional command, be tried a second time, even though justice demands that another distinct issue, because erroneously determined, must again be passed on by a jury.” Id. at 498, 51 S.Ct. at 514. The admonition of the Supreme Court was not to resort to partial remand except in cases in which "the issue to be retried is so distinct and separable from the others that retrial of it alone may be had without injustice." Id. at 500, 51 S.Ct. at 515. That is precisely the situation we have in this products liability case based on strict liability. The jury already has properly decided' — as have the juries in the other cases involving this combine — that the Deere combine at issue was defective and unreasonably dangerous as designed, manufactured, and sold by Deere. Whether Deere acted with willful and wanton disregard of the rights or safety of another is distinct from the existence of the defect; rather, it concerns Deere's knowledge or awareness of that defect and its actions or inactions in consideration of that knowledge. It is an issue that is entirely separable from the question whether the product was defective and unreasonably dangerous. Thus, retrial on the issue of punitive damages alone may easily be had in this case without injustice.

. The majority does not dispute that inadequate warning may render a product defective and unreasonably dangerous under Iowa law. It responds only that this "was not Burke’s theory.” Supra at 504 n. 7. Burke’s "theory” was strict liability in tort for the design, manufacture, and sale of a defective and unreasonably dangerous product. Iowa law allows him to recover for his injuries caused by that product, and Instruction No. 14 quite correctly reflects that law.

. The majority’s opinion appears to manifest a distaste for punitive damages generally. I note for the record that such awards, firmly rooted in our common law for well over a century, are perfectly proper in an appropriate case and offend neither Iowa law nor the United States Constitution. See, e.g., TXO Production Corp. v. Alliance Resources Corp., — U.S. -, 113 S.Ct. 2711, 125 L.Ed.2d 366 (1993). Recent empirical study, moreover, has debunked the mythology of "skyrocketing awards," "runaway juries,” and "competitive disadvantage” too often erroneously associated with such awards. See, e.g., Michael Rustad, In Defense of Punitive Damages in Products Liability: Testing Tort Anecdotes with Empirical Data, 78 Iowa L.R. 1 (1992).

. The majority finds that the issue of á duty to retrofit was sufficiently preserved for appeal. Supra at 509 n. 20. The majority ignores the applicable federal rule: "No party may assign as error the giving or the failure to give an instruction unless that party objects thereto before the jury retires to consider its verdict, stating distinctly the matter objected to and the grounds of the objection.” Fed.R.Civ.P. 51 (emphasis added); accord Board of Water Works Trustees v. Alvord, Burdick & Howson, 706 F.2d 820, 824 (8th Cir.1983). Further, "[a] party may not state one ground when objecting to an instruction and attempt to rely on a different ground for the objection on appeal or on a motion for a new trial.” 9 Charles A. Wright and Arthur R. Miller, Federal Practice and Procedure § 2554 (1971); accord Siegfried v. Kansas City Star Co., 298 F.2d 1, 7 (8th Cir.) (“It is apparent that the objection now raised is somewhat different from that raised in the trial court, and hence the criticism of the instructions now made is not properly before us for consideration.”), cert. denied, 369 U.S. 819, 82 S.Ct. 831, 7 L.Ed.2d 785 (1962).

. The Iowa Supreme Court’s approval of awarding punitive damages in cases described by the language in Fell is not unique. The Alaska Su*518preme Court, as one example on point, has held the same:
We also reject the argument that punitive damages have no place in a strict liability case.... Where ... plaintiff is able to plead and prove that the manufacturer knew that its product was defectively designed and that injuries and deaths had resulted from the design defect, but continued to market the product in reckless disregard of the public's safety, punitive damages may be awarded.
Sturm, Ruger & Co., Inc. v. Day, 594 P.2d 38, 46-47 (Alaska 1979) (citing numerous cases from other jurisdictions), modified on other grounds, 615 P.2d 621 (Alaska 1980), cert. denied, 454 U.S. 894, 102 S.Ct. 391, 70 L.Ed.2d 209 (1981).