Bic Pen Corp.. v. Carter

• Decision Date: 04 December 2008
• Docket Number: No. 13–03–00560–CV.,13–03–00560–CV.
• Citation: 346 S.W.3d 569
• Parties: BIC PEN CORP., Appellant,v.Janace M. CARTER, Individually and as Next Friend of Brittany Carter, Jonas Carter, and Tarasha Gipson, Appellees.
• Court: Texas Court of Appeals

346 S.W.3d 569

BIC PEN CORP., Appellant,

v.Janace M. CARTER, Individually and as Next Friend of Brittany Carter, Jonas Carter, and Tarasha Gipson, Appellees.

No. 13–03–00560–CV.

Court of Appeals of Texas, Corpus Christi–Edinburg.

Dec. 4, 2008.

Darrell L. Barger, Kyle H. Dreyer, Reagan Wm. Simpson and Bert L. Huebner, for BIC Pen Corporation.Daniel G. Gurwitz, Daniel Keith Worthington and Lisa Powell, for Janace M. Carter, Individually and as Next Friend of Brittany Carter, Jonas Carter, and Tarasha Gipson.Before Justices HINOJOSA ¹, YAÑEZ, and GARZA.

MEMORANDUM OPINION ON REMAND

Memorandum Opinion on Remand by Justice GARZA.

Appellant, BIC Pen Corp. (“BIC”), challenges a jury verdict awarding actual and exemplary damages to appellee, Janace M. Carter, individually and as next friend of her children, Brittany Carter, Jonas Carter, and Tarasha Gipson. Carter sued BIC, claiming that design and manufacturing defects in a cigarette lighter caused injuries to Brittany. The jury found both design and manufacturing defects, and we affirmed based solely on an analysis of the design defect finding. BIC Pen Corp. v. Carter, 171 S.W.3d 657 (Tex.App.-Corpus Christi 2005), rev'd, 251 S.W.3d 500 (Tex.2008). Subsequently, the Texas Supreme Court held that Carter's design defect claim was preempted by federal law and remanded the cause to us to address her manufacturing defect claim. BIC Pen Corp., 251 S.W.3d at 509, 511. We affirm in part and reverse and render in part.

I. Background

On May 27, 1998, five-year-old Jonas accidentally set fire to the dress of his six-year-old sister, Brittany, using a BIC model J–26 cigarette lighter (the “Subject Lighter”). As a result, Brittany suffered third-degree burns to over 55 percent of her body. In October 1998, Carter sued BIC, claiming that Brittany's injuries were caused by manufacturing and design defects in the lighter. A jury found in favor of Carter and awarded three million dollars in actual damages. Upon finding that BIC acted with malice, the jury awarded an additional two million dollars in exemplary damages.²

On original submission to this Court, BIC contended that: (1) Carter's design defect and manufacturing defect claims were preempted by federal law; (2) the evidence adduced at trial was legally and factually insufficient to support a finding of a design defect or a manufacturing defect, that any such defect caused Brittany's injuries, or that BIC had acted with malice; (3) the trial court erred in giving a spoliation instruction; (4) the trial court erred in admitting the testimony of certain expert witnesses; and (5) the trial court awarded excessive interest. We affirmed, holding that: (1) the design defect claim was not preempted by federal law; (2) the evidence was sufficient to prove that a design defect in the lighter caused Brittany's injuries and that BIC acted with malice; (3) the trial court did not commit reversible error by admitting the challenged expert testimony; and (4) the trial court did not award excessive interest. BIC Pen Corp., 171 S.W.3d at 662. Because we affirmed the jury's verdict on Carter's design defect claim, we did not address any of BIC's issues as they related to the manufacturing defect claim. Id. at 662 & n. 3.

The supreme court subsequently found that federal consumer product safety law preempted Carter's design defect claim. BIC Pen Corp., 251 S.W.3d at 509, 511. The court noted specifically that the lighter safety standards set by the Consumer Product Safety Commission (“CPSC”), which the Subject Lighter satisfied, could not be interpreted as a “liability floor” that may be enhanced by state law.³Id. at 507. Rather, because the CPSC already performed a cost-benefit analysis when formulating its standard, the trial court could not impose a more strict common law standard without conflicting with the federal regulatory scheme. Id. at 509.

We must now address BIC's three remaining issues: (1) whether Carter's manufacturing defect claim is preempted by federal consumer product safety law; (2) whether the trial court erred in giving the spoliation instruction; and (3) whether the evidence was legally and factually sufficient to support the jury's findings that there was a manufacturing defect in the Subject Lighter, that such a defect caused Brittany's injuries, and that BIC acted with malice.

II. Discussion

A. Preemption

When a state law conflicts with federal law, it is preempted and has no effect. U.S. Const. art. VI, cl. 2; Maryland v. Louisiana, 451 U.S. 725, 747, 101 S.Ct. 2114, 68 L.Ed.2d 576 (1981); Mills v. Warner Lambert Co., 157 S.W.3d 424, 426 (Tex.2005). State laws may conflict with federal laws expressly, see Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992); Great Dane Trailers, Inc. v. Estate of Wells, 52 S.W.3d 737, 743 (Tex.2001), or impliedly, see Freightliner Corp. v. Myrick, 514 U.S. 280, 287, 115 S.Ct. 1483, 131 L.Ed.2d 385 (1995); Great Dane Trailers, Inc., 52 S.W.3d at 743. Federal statutes and regulations impliedly conflict with state law when such statutes and regulations “indicate [ ] that Congress intended federal law to occupy the field exclusively or if state law actually conflicts with federal law or regulations.” Great Dane Trailers, Inc., 52 S.W.3d at 743 (citing Freightliner Corp., 514 U.S. at 287, 115 S.Ct. 1483). “State law presents an actual conflict with federal law when: (1) it is impossible for a private party to comply with both state and federal requirements; or (2) state law obstructs accomplishing and executing” the “full purposes and objectives” of Congress. Id. Here, BIC argues that Carter's claims are impliedly preempted because validation of her claims would impose standards that would obstruct the accomplishment and execution of the full purposes and objectives of the federal Consumer Product Safety Act (“CPSA”). Preemption is a legal issue which we review de novo. BIC Pen Corp., 171 S.W.3d at 663; see City of Euless v. Dallas/Fort Worth Int'l Airport Bd., 936 S.W.2d 699, 702 (Tex.App.-Dallas 1996, writ denied) (citing In re Humphreys, 880 S.W.2d 402, 404 (Tex.1994)).

On original submission, BIC contended that a finding in favor of Carter would frustrate the purposes underlying the CPSA ⁴ because it would impose a rule requiring: (1) a higher minimum percentage of children who cannot operate the lighter, and (2) a more advanced age for children to be tested with surrogate lighters.⁵ Carter countered by arguing that her common law claim is expressly preserved according to the saving clause contained in the CPSA, which states that “[c]ompliance with consumer product safety rules or other rules or orders under this chapter shall not relieve any person from liability at common law or under State statutory law to any other person.” Id. § 2074(a). However, although the saving clause allows state-law tort claims, it “does not permit claims that actually conflict with federal regulations.” BIC Pen Corp., 251 S.W.3d at 506; see Geier v. Am. Honda Motor Co., 529 U.S. 861, 872, 120 S.Ct. 1913, 146 L.Ed.2d 914 (2000).

The Texas Supreme Court agreed with BIC that a finding in favor of Carter on her design defect claim would conflict with the federal purposes underlying the CPSA by imposing a more restrictive standard than that called for by the federal regulatory scheme. BIC Pen Corp., 251 S.W.3d at 509. The court reasoned that, because the CPSC had engaged in a cost-benefit analysis in formulating the safety standard for lighters, the standard was not simply a “liability floor” which common law liability could supplement. Id. at 507 (“The [CPSC] specifically noted that a higher ( [ninety] percent) acceptance criterion was also considered, but rejected because the higher performance level [was] not commercially or technically feasible for many firms and would have substantial adverse effects on manufacturing and competition, and would increase costs disproportionate to benefits.”) (internal quotations and citations omitted).

The court, however, noted that Carter's manufacturing defect claim raises a question separate from whether the design itself was faulty, and remanded to us to determine whether the manufacturing defect claim is similarly preempted. Id. at 509. We hold that it is not. The CPSC promulgates standards regulating the design of consumer products, not their manufacture. Moreover, there is no mechanism in the CPSA or in the corresponding federal regulations addressing products designed in accordance with the federal standards yet manufactured in a way that deviates from those standards. See Cooper Tire & Rubber Co. v. Mendez, 204 S.W.3d 797, 800 (Tex.2006) (“A manufacturing defect exists when a product deviates, in its construction or quality, from the specifications or planned output in a manner that renders it unreasonably dangerous.”). Therefore, a common law rule requiring a manufacturer to construct its products in conformance with design specifications—which would result from a finding that BIC was liable on Carter's manufacturing defect claim—would not conflict in any way with the federal regulatory scheme establishing standards for those specifications. On the contrary, such a common law rule is necessary to ensure that manufacturers comply with the federal regulatory scheme. To hold otherwise would be to nonsensically state that manufacturers have an obligation to design products pursuant to regulatory standards but are free to deviate from those standards when actually manufacturing the product. Such a holding would nullify the stated federal objective of “protect[ing] the public against unreasonable risks of injury associated with consumer products.” 15 U.S.C. § 2051(b).

Accordingly, we conclude that Carter's manufacturing defect claim is not preempted by federal law. BIC's first remaining issue is overruled.

B. Spoliation Instruction

BIC argues that it is entitled to a new trial because the trial court erred in...