City of New York v. Charles Pfizer & Company, Inc.

Decision Date06 April 1999
Citation260 A.D.2d 174,688 N.Y.S.2d 23
PartiesCITY OF NEW YORK et al., Appellants,<BR>v.<BR>CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 1.)<BR>CITY OF NEW YORK et al., Appellants,<BR>v.<BR>CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 2.)<BR>CITY OF NEW YORK, Appellant,<BR>v.<BR>CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 3.)
CourtNew York Supreme Court — Appellate Division

Concur — Sullivan, J. P., Tom, Lerner and Rubin, JJ.

In these actions, plaintiffs seek to recover the costs of abating asbestos-containing materials from their buildings. Defendant Pfizer is sued solely based on the installation in certain of plaintiffs' buildings prior to 1955 of the asbestos-containing lime-based acoustical plaster Kilnoise, which was manufactured and sold by the now defunct Kelley Island Lime and Transport Company, subsequently (after merger with another entity) known as Kelley Island Company (collectively, Kelley Island). In 1955, Basic Refractories, Incorporated, now known as Basic Incorporated (Basic), purchased all of Kelley Island's assets (except for the stock of a wholly-owned subsidiary not here pertinent) and Kelley Island was dissolved. In 1957, Basic incorporated a wholly-owned subsidiary, Tiger Brands, Inc. (Tiger Brands) to conduct its building materials businesses, including the Kilnoise product line, among other lime-based products. In 1962, Basic sold its lime product business to Gibsonburg Lime Products Corporation (Gibsonburg), which in 1964 sold all of its assets to Pfizer and dissolved. Pfizer continued to manufacture and sell Kilnoise until it discontinued the product in 1972.

We agree with the IAS Court that Gibsonburg, Pfizer's predecessor-in-interest, did not, by reason of the provision in its contract to purchase Basic's lime products business that Basic would indemnify it against claims arising "with respect to any hydrated lime products sold by Basic prior to the Closing Date", impliedly assume the liabilities of Basic's predecessor-in-interest in the lime products business, Kelley Island. Had the parties intended that Gibsonburg assume such liabilities, they would have expressly so provided in their agreement.

We also agree with the IAS Court that Gibsonburg did not succeed to the liabilities of Kelley Island by virtue of any de facto merger, inasmuch as Basic, which had succeeded to Kelley Island's liabilities through the 1955 transaction, cannot be deemed to have been "merged" into Gibsonburg. Basic sold Gibsonburg only a small part of its business, continues to do ...

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15 cases
  • New York v. National Service Industries, Inc.
    • United States
    • U.S. Court of Appeals — Second Circuit
    • August 3, 2006
    ...complex economic considerations better left to be addressed by the Legislature.'" Id. (quoting City of New York v. Pfizer, 260 A.D.2d 174, 688 N.Y.S.2d 23, 25 (1st Dep't 1999)). Although Semenetz concerned a different theory of successor liability, it suggests that the New York Court of App......
  • Cargo Partner Ag v. Albatrans Inc.
    • United States
    • U.S. District Court — Southern District of New York
    • March 13, 2002
    ...to be a rejection of the Turner and Ray exceptions, and several courts have so held. See City of New York v. Charles Pfizer & Company, Inc., 260 A.D.2d 174, 176, 688 N.Y.S.2d 23, 25 (1st Dept.1999); Radziul v. Hooper, Inc., 125 Misc.2d 362, 479 N.Y.S.2d 324 (N.Y.Sup. 1984); Parra v. Product......
  • U.S. v. General Battery Corp., Inc.
    • United States
    • U.S. Court of Appeals — Third Circuit
    • September 6, 2005
    ...58, 679 N.Y.S.2d 740 (N.Y.App.Div.1998) (applying product line theory of successor liability), with City of N.Y. v. Charles Pfizer & Co., 260 A.D.2d 174, 688 N.Y.S.2d 23 (N.Y.App.Div.1999) (rejecting same theory). Even jurisdictions in broad agreement on the appropriate legal standards may ......
  • Ortiz v. Green Bull, Inc.
    • United States
    • U.S. District Court — Eastern District of New York
    • November 14, 2011
    ...by the Legislature.'" Semenetz, 7 N.Y.3d at 201, 818 N.Y.S.2d at 824, 851 N.E.2d at 1175 (quoting City of New York v. Pfizer, 260 A.D.2d 174, 176, 688 N.Y.S.2d 23, 25 (1st Dep't 1999)); see also Doktor v. Werner Co., 762 F. Supp. 2d 494, 499 (E.D.N.Y. 2011) (finding that the holding in Seme......
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1 books & journal articles
  • Buyer beware: you may be liable for the defective products of your predecessor.
    • United States
    • Defense Counsel Journal Vol. 75 No. 2, April 2008
    • April 1, 2008
    ...Mach. Corp., 679 N.Y.S.2d 740 (N.Y. App. Div. 1998) (endorsing the product line exception) and City of New York v. Pfizer & Co., 688 N.Y.S.2d 23 (N.Y. App. Div. 1999) (rejecting the product line (59) PRODUCT LIABILITY DESK REFERENCE: A FIFTY-STATE COMPENDIUM 49-50, 134 (Morton F. Daller......

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