A Colo. Mun.ity v. Teleflex

• Decision Date: 14 October 2010
• Docket Number: No. 08-1272.,08-1272.
• Parties: Karen KOKINS; The City of Westminster, a Colorado municipality, Plaintiffs-Appellants, v. TELEFLEX, INCORPORATED, a foreign corporation, Defendant-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

621 F.3d 1290

Karen KOKINS; The City of Westminster, a Colorado municipality, Plaintiffs-Appellants,

v.TELEFLEX, INCORPORATED, a foreign corporation, Defendant-Appellee.

No. 08-1272.

United States Court of Appeals,Tenth Circuit.

Oct. 14, 2010.

Scott R. Larson, of Scott R. Larson, P.C., Denver, CO, for Plaintiffs-Appellants.

Laurin D. Quiat (Cory M. Curtis with him on the brief), of Baker & Hostetler LLP, Denver, CO, for Defendant-Appellee.

Before BRISCOE, Chief Judge, TYMKOVICH, and HOLMES, Circuit Judges.

HOLMES, Circuit Judge.

Appellants Karen Kokins and the City of Westminster sued Teleflex in this products liability action. The jury returned a verdict for Teleflex. Appellants now ask us to grant them a new trial because they claim that the district court improperly instructed the jury on two issues. First, Appellants contend that the district court failed to give the appropriate instruction for determining whether a product is defectively designed. Second, they allege that the district court erred by instructing the jury regarding a Colorado statutory presumption of non-defectiveness. Because we conclude that the district court did not err, we AFFIRM its entry of judgment for Teleflex.

I. BACKGROUND

Ms. Kokins was employed as a park ranger for the City of Westminster, Colorado, at the City's Standley Lake facility. On July 6, 2004, she was on duty and patrolling the lake by boat when the boat's steering cable suddenly snapped, causing the boat to careen sharply and throwing Ms. Kokins overboard. She sustained serious and lasting injury to her ankle as a result of the accident. Despite five surgeries, she has not regained normal use of it. Ms. Kokins and the City brought suit in Colorado state court against Teleflex, the maker and seller of the steering cable, alleging, inter alia, that the cable was defectively designed and unreasonably dangerous. Ms. Kokins sought damages in connection with her injuries. The City sought to recover the amount it had paid Ms. Kokins in workers' compensation. Pursuant to 28 U.S.C. § 1441, Teleflex removed the case to federal district court based on diversity of citizenship.

A. Evidence Presented at Trial

The parties agreed that the steering cable snapped because water had entered its inner core and caused it to rust. ¹ But they disagreed about how the water got there, and whether the cable could have been designed to avoid such corrosion. This made the design of the cable a critical disputed issue at trial.

Appellants alleged that the cable was defective in two ways. First, they argued that a design defect allowed water to invade the cable, causing its carbon-steel core to rust. Appellants' experts presented evidence of how water entered the core and contended that grease fittings or O-rings could have sealed gaps in the cable. Teleflex's experts responded with evidence that the cable on Ms. Kokins's boat was incorrectly installed. Teleflex also pointed out that boat operators are instructed to regularly grease the cable to prevent water penetration, and elicited testimony that City employees had failed to undertake this routine maintenance. One Teleflex engineer testified that of the four to five million cables sold since the early 1960s, none had failed in the manner of the cable installed in Ms. Kokins's boat.

Second, Appellants contended that the cable was defective because its inner core should have been made of stainless steel rather than carbon steel. Stainless steel was a safer choice, Appellants claimed, because it was less prone to corrode if water did invade the cable core. Teleflex countered with expert testimony that carbon steel is preferable because it is stronger than stainless steel. Further, experts for Teleflex testified that carbon steel expands when it rusts, causing the cable to stiffen, making the boat more difficult to steer, and alerting the operator that the cable needs to be replaced. By contrast, stainless steel is subject to sudden cracking under stress and provides no advance warning that it is deteriorating.

Altogether the jury heard testimony about the design, use, and installation of the cable from eight witnesses-a forensic engineer, a mechanical engineer, two mechanics, a metallurgist, a consultant, a product assurance manager for Teleflex, and a former Teleflex senior design engineer.

B. Disputes Concerning Jury Instructions

The two disputes forming the basis for this appeal arose when it came time to instruct the jury. First, the parties disagreed about the proper instruction for determining whether a product is defectively designed and unreasonably dangerous. Colorado law provides two different tests. Under the “consumer expectation” test, the jury is instructed to find defectiveness if the plaintiff proves that a product is dangerous “to an extent beyond that which would be contemplated by the ordinary consumer who purchases it.” Ortho Pharm. Corp. v. Heath, 722 P.2d 410, 413 (Colo.1986) (quoting Restatement (Second) of Torts § 402A cmt. I (1965)) (internal quotation marks omitted), overruled on other grounds by Armentrout v. FMC Corp., 842 P.2d 175 (Colo.1992). Under the “risk-benefit” test, the jury is instructed to conclude that a product is unreasonably dangerous if the plaintiff proves that the risks of a challenged design outweigh its benefits. Armentrout, 842 P.2d at 182-84. Appellants submitted instructions proposing that the district court instruct the jury under both tests, but the district court gave only the risk-benefit instruction.

The second dispute centered on the applicability of Colorado Revised Statute § 13-21-403(3), which creates a presumption that a product is not defective once it has been on the market for ten years. Over Appellants' objections, the district court instructed the jury on the presumption.

The jury returned a verdict for Teleflex and the district court entered judgment accordingly. Ms. Kokins and the City timely appealed. We have jurisdiction pursuant to 28 U.S.C. § 1291.

II. DISCUSSIONA. Jury Instruction for Defective Design

Appellants first argue that the district court erred when it refused to instruct the jury on Colorado's consumer expectation test. We detect no error in the instruction given by the district court.

1. Standard of Review

“We review the district court's decision about whether to give a particular instruction for abuse of discretion.” Martinez v. Caterpillar, Inc., 572 F.3d 1129, 1132 (10th Cir.2009). “We review the trial court's conclusions on legal issues de novo, however, and need not defer to its decisions on questions of law.”

City of Wichita v. U.S. Gypsum Co., 72 F.3d 1491, 1495 (10th Cir.1996).

In a diversity case like this one, the substance of jury instructions is a matter of state law. City of Wichita, 72 F.3d at 1494-95; see also Erie R.R. Co. v. Tompkins, 304 U.S. 64, 77-80, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). In such a case, our task is “not to reach [our] own judgment regarding the substance of the common law, but simply to ascertain and apply the state law.” Wankier v. Crown Equip. Corp., 353 F.3d 862, 866 (10th Cir.2003) (quoting Huddleston v. Dwyer, 322 U.S. 232, 236, 64 S.Ct. 1015, 88 L.Ed. 1246 (1944)) (internal quotation marks omitted). To properly discern the content of state law, we “must defer to the most recent decisions of the state's highest court.” Id. Of course, by the principles of stare decisis, we also are bound by our own prior interpretations of state law. “[W]hen a panel of this Court has rendered a decision interpreting state law, that interpretation is binding on district courts in this circuit, and on subsequent panels of this Court, unless an intervening decision of the state's highest court has resolved the issue.” Id. (emphasis added).

2. Legal Background

Appellants argue that the district court misapplied Colorado law when it refused to instruct the jury on both the consumer expectation test and the risk-benefit test. To grapple with this contention, we must discern the import of Colorado law.

The guiding case for us is Camacho v. Honda Motor Co., Ltd., 741 P.2d 1240 (Colo.1987). The plaintiff in Camacho crashed his motorcycle and injured his legs. He sued Honda, the manufacturer of the motorcycle, alleging that the vehicle was defectively designed because it lacked steel crash bars that would have protected his legs and lessened the severity of his injuries. Id. at 1242. The trial court granted Honda's motion for summary judgment, applying a form of the consumer expectation test and concluding that the risk of leg injury was obvious and foreseeable to any purchaser of a motorcycle. Id. The Colorado Supreme Court reversed and remanded, holding that the consumer expectation test was inadequate under these circumstances. “Total reliance upon the hypothetical ordinary consumer's contemplation of an obvious danger,” the court reasoned, “diverts the appropriate focus and may thereby result in a finding that a product is not defective even though the product may easily have been designed to be much safer at little added expense and no impairment of utility.” Id. at 1246; see also id. at 1247 n. 8.

In reaching this result, the court offered a standard for identifying those cases where the consumer expectation test would not be sufficient:

[E]xclusive reliance upon consumer expectations is a particularly inappropriate means of determining whether a product is unreasonably dangerous ... where both the unreasonableness of the danger in the design defect and the efficacy of alternative designs in achieving a reasonable degree of safety must be defined primarily by technical, scientific information.

Id. at 1246-47 (citing Ortho Pharm. Corp., 722 P.2d at 414); see also Armentrout, 842 P.2d at 180-82 (discussing the Camacho standard); White v. Caterpillar, Inc., 867 P.2d 100, 104-06 (Colo.App.1993) (applying Camacho to conclude that the trial court erred by not instructing the jury concerning the risk-benefit test).

Our cou...