Dg&G v. Flexsol Packaging Corp. of Pompano Beach

• Decision Date: 17 August 2009
• Docket Number: No. 08-3417.,08-3417.
• Citation: 576 F.3d 820
• Parties: DG & G, INC., Plaintiff-Appellant, v. FLEXSOL PACKAGING CORP. OF POMPANO BEACH, Defendant-Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

576 F.3d 820

DG & G, INC., Plaintiff-Appellant, v. FLEXSOL PACKAGING CORP. OF POMPANO BEACH, Defendant-Appellee.

No. 08-3417.

United States Court of Appeals, Eighth Circuit.

Submitted: June 10, 2009.

Filed: August 17, 2009.

Joseph C. Blanton Jr., argued, Thomas Collins, III, Shaun D. Hanschen, on the brief, Sikeston, MO, for appellant.

Joseph Robert Swift, argued, Thomas Michael Ward, Joshua Stegman, on the brief, St. Louis, MO, for appellee.

Before BYE, HANSEN, and BENTON, Circuit Judges.

BENTON, Circuit Judge.

DG&G, Inc. appeals from a summary judgment for FlexSol Packaging Corp. DG&G also claims that the district court¹ erred in admitting unsworn exhibits, and excluding expert testimony. Jurisdiction being proper under 28 U.S.C. § 1291, this court affirms.

I.

In the fall of 2005, DG&G, a cotton gin operator, routinely added moisture to cotton after ginning and before baling. DG & G put the bales in polyethylene (PE) bags designed and manufactured by FlexSol. When the cotton was inspected in January 2006, it had large spots of mold. The average bale moisture was 12.83%, with the excess water unevenly applied to the cotton.

FlexSol's PE bags were approved by the National Cotton Council as satisfactory for bagging cotton. The purpose of bagging is to protect the bale from contamination. The NCC evaluates bags based on five criteria: tensile strength, thickness, elongation, resin type, and tear resistence. FlexSol's PE bags have been approved since 1998, and most recently in 2006. While the NCC requires that bag manufacturers indicate the breathability of their bags, the specifications do not consider it.

FlexSol did not warn that its bags would not allow moisture-restored cotton to breathe and equilibrate with the environment. DG & G used FlexSol bags from 2001 through 2005. In 2004, out of 45,000 bales DG & G produced, 68 bales had water damage.

DG&G used a Moisture Restoration direct spray system in its gin. DG&G asserts it closely monitored the water restored to each bale, and that its Vomax Microwave Bale Moisture Sensor reported no excess water. In September 2005, DG&G contacted Vomax to investigate whether its machine was functioning properly. A Vomax representative visited the gin twice. He found that the cotton was wet, most likely because the spray system applied water unevenly.

Two cotton marketing associations sued DG & G and related parties for the damaged bales. DG&G cross-claimed against the warehouse owner, gin-equipment manufacturers, and cotton-bag distributors and manufacturers, including FlexSol. DG&G settled with all parties except FlexSol. Against FlexSol, DG&G claimed: 1) strict liability failure-to-warn; 2) strict liability product-defect; 3) negligence; and 4) breach of implied warranties. FlexSol moved for summary judgment, which the court granted.

II.

DG&G claims that the district court erred in granting FlexSol's motion for summary judgment. This court reviews the district court's judgment de novo. Allianz Ins. Co. of Can. v. Sanftleben, 454 F.3d 853, 855 (8th Cir.2006). Viewing the evidence most favorably to the non-moving party, summary judgment is appropriate if there are no issues as to any material fact, and the moving party is entitled to judgment as a matter of law. Id.

A.

DG&G argues that FlexSol failed to warn that PE bags were inappropriate for moisture-restored cotton. Under Missouri law, the requirements for a strict liability failure-to-warn claim are: 1) the defendant sold the product in the course of its business; 2) the product was unreasonably dangerous at the time of the sale when used as reasonably anticipated without knowledge of its characteristics; 3) the defendant did not give an adequate warning of the danger; 4) the product was used in a manner reasonably anticipated; and 5) the user was damaged as a direct result of the product. Campbell v. Am. Crane Corp., 60 F.3d 1329, 1331 (8th Cir.1995).

As for "direct result" causation, a failure-to-warn claimant must demonstrate: 1) the product for which there was no warning must have caused the user's damages; and 2) the user must show that a warning would have altered the behavior of those involved in the accident. Id. With respect to the second component: "If there is sufficient evidence from which a jury could find that the plaintiff did not already know of the danger, there is a presumption that a warning will be heeded." Tune v. Synergy Gas Corp., 883 S.W.2d 10, 14 (Mo. banc 1994). See Klugesherz v. Am. Honda Motor Co., 929 S.W.2d 811, 814 (Mo.App.1996) (noting the presumption is "rebuttable"). "It is not enough for the defendant to show that the plaintiff knew of the general dangers associated with the activity; rather the defendant must show that the plaintiff knew of the specific danger that caused the injury." See Smith v. Brown & Williamson Tobacco Corp., 275 S.W.3d 748, 785 (Mo.App. 2008), citing Cole v. Goodyear Tire & Rubber Co., 967 S.W.2d 176, 184 (Mo.App. 1998).

Manufacturers and distributors are not under a duty to provide warnings about dangers which are open and obvious, or which are commonly known. If the user of a product knows or reasonably may be expected to know of a particular danger, strict liability will not result from a failure to warn of that danger.

Grady v. Am. Optical Corp., 702 S.W.2d 911, 915 (Mo.App.1985) (citations omitted).

DG&G asserts that, without a warning, it had no knowledge that the PE bags' lack of permeability would cause damage when used with the moisture restoration system. DG&G admits, however, that the cotton industry "was well aware of PE bags' shortcomings in breathability." DG&G knew that bagging cotton with excess moisture would damage the bale—in 2004, DG&G had 68 bales with water damage. During the 2005 season, DG&G called a Vomax representative to check on the moisture sensor. The gin manager expressed a concern that "the readings were too consistent," and that the machine may be improperly measuring the moisture added to the cotton. DG&G had used FlexSol's bags since 2001, and knew or reasonably may be expected to have known of the specific danger of bagging cotton with excess moisture in PE bags. See Campbell, 60 F.3d at 1333 (holding that a crane operator with many years of experience "can have reasonably been expected to know of the open and obvious danger" of performing maintenance on the crane). The district court properly dismissed DG&G's strict liability failure-to-warn claim.

B.

DG&G claims that FlexSol's PE bags were defective. Under Missouri law, the requirements of a strict liability defective-product claim are: 1) the defendant sold the product in the course of its business; 2) the product was then in a defective condition, unreasonably dangerous when put to a reasonably anticipated use; 3) the product was used in a manner reasonably anticipated; and 4) the user was damaged as a direct result of the product. Lay v. P & G Health Care, Inc., 37 S.W.3d 310, 325 (Mo.App.2000).

"Strict liability does not equate with absolute liability." Rogers v. Toro Mfg. Co., 522 S.W.2d 632, 637 (Mo.App. 1975). The claimant must prove that the product "was being used in a manner reasonably anticipated." Id. "The concept of reasonably anticipated use, however, includes misuse and abnormal use which is objectively foreseeable." Nesselrode v. Executive Beechcraft, Inc., 707 S.W.2d 371, 381 (Mo. banc 1986).

DG&G argues that it put FlexSol's bags to a reasonably anticipated use. In 2004, the NCC recommended to all ginners: 1) 7.5% moisture content should be a ceiling, and not a target; and 2) an average level of 7.5% could be excessive if the moisture is not uniformly distributed. DG&G's cotton had moisture distributed unevenly throughout the bales, and registered an average bale moisture of 12.83%. See Mich. Millers Mut. Ins. Co. v. DG & G Co., Inc., 569 F.3d 807, 812 (8th Cir.2009) ("[W]e agree with the district court that there is no genuine issue as to the material fact that at least some of the property damage occurred at the gin when DG&G added so much excess moisture that the cotton was `not merchantable' when it left the gin...."). Bagging DG&G's excessively-water-packed cotton is not a reasonably anticipated use of FlexSol's PE bags.

According to DG&G, the PE bags have an alternative reasonably anticipated use—allowing the moisture level of cotton to equilibrate with the atmosphere. FlexSol's bags were approved by the NCC. The NCC specifications for the PE bags do not require that they dry moisture-restored cotton—FlexSol's bags were approved based on their tensile strength, thickness, elongation, resin type, and tear resistance. While the NCC requires that bag manufacturers indicate the breathability of the bags produced, the specifications do not consider it. The bags are manufactured to protect cotton bales from contamination. There is no support for DG&G's theory that it reasonably used the bags for their moisture vapor transmission rate.

DG&G also states that using the bags to transfer moisture was a "misuse or abnormal use" that was objectively foreseeable. DG&G acknowledges that the cotton "industry was well aware of PE bags' shortcomings in breathability." Based on the industry standard, it is not objectively foreseeable that DG&G would use the bags because of their breathability. See Nesselrode, 707 S.W.2d at 381 (considering the "reasonably anticipated" use of a product with respect to the "industry standard").

In sum, DG&G has failed to demonstrate that it put the bags to a reasonably anticipated use. The district court properly granted FlexSol's motion for summary judgment on the strict liability defective-product claim.

C.

Because DG&G did not establish a reasonably anticipated use, DG&G's negligence and implied warranty claims were properly dismissed. See Welsh v. Bowling Elec. Mach., Inc., 875 S.W.2d 569, 572-74 (Mo.App.1994) (negligence theory requires the plaintiff establish that the product was foreseeably...