Hankook Tire Co. v. Philpot
| Decision Date | 20 May 2020 |
| Docket Number | No. CV-19-461,CV-19-461 |
| Citation | 2020 Ark. App. 316,603 S.W.3d 614 |
| Parties | HANKOOK TIRE CO., LTD., and Hankook Tire America Corp., Appellants v. Elmer PHILPOT, Appellee |
| Court | Arkansas Court of Appeals |
Hardin, Jesson & Terry, PLC, Little Rock, by: Kynda Almefty and Carol Ricketts, for appellants.
Dobson Law Firm, P.A., Sheridan, by: R. Margaret Dobson ; Kelly Law Firm, P.A., by: Jerry Kelly, Little Rock; Kaster-Lynch, P.A., by: Bruce Kaster; and Gordon, Caruth & Virden, P.L.C., Morrilton, by: Ben Caruth, for appellee.
A jury in Conway County, Arkansas, found the appellants, Hankook Tire Company, Ltd. (Hankook), and Hankook Tire America Corporation (Hankook America) strictly liable for injuries that the appellant, Elmer Philpot, suffered after the failure of a Hankook tire caused him to lose control of the dump truck he was driving on State Highway 9 in Conway County on July 6, 2010.1 Hankook now appeals the judgment, alleging that the circuit court erred by excluding an expert opinion, by refusing to strike a documentary exhibit, by denying Hankook and Hankook America's motions for directed verdicts, and by imposing sanctions for untimely discovery.
This is the third attempted appeal in this case. We previously dismissed without prejudice Hankook's appeal from the circuit court's order imposing attorney's fees as a discovery sanction in Hankook Tire Co., Ltd. v. Philpot , 2016 Ark. App. 386, 499 S.W.3d 250. We held that the court's order awarding attorney's fees was not a final, appealable order because it did not contain an adequate certification that it was a final judgment under Ark. R. Civ. P. 54(b). Id. at 7–8, 499 S.W.3d at 253–54. Additionally, in 2018, we dismissed without prejudice Hankook's appeal from the judgment following the jury's verdict. The judgment was not final as to all claims and parties because there were no written orders concluding either Philpot's claim against his employer, Kenneth Hedrick or Mr. Hedrick's cross-claim against Hankook.2 See Hankook v. Philpot , 2018 Ark. App. 546, at 4–5, 564 S.W.3d 555, 557–58.
The circuit court entered an amended judgment on February 19, 2019, that finally adjudicates all the claims in the case. Now that we have jurisdiction to decide the merits of the appeal, we affirm.
As we explained in our previous opinions, appellant Hankook Tire Company, Ltd., manufactures tires in South Korea and Europe, and appellant Hankook Tire America Corporation distributes the tires in the United States. Appellee Elmer Philpot was driving a dump truck that had a Hankook tire installed on the right front wheel. The tire failed as Philpot was driving on State Highway 9 on July 6, 2010, causing him to lose control of the truck and crash into a drainage ditch on the side of the highway. Philpot suffered severe injuries when the force of the impact in the ditch ejected him through the truck's windshield.
The case was initially filed in June 2012 in Conway County. Philpot later filed an amended complaint on March 14, 2014. Philpot alleged that Hankook manufactured the inherently defective steel-belted tire, "Hankook 385/65R 22.5 Super Single radial medium truck tire" (Hankook Model 240), and distributed it for sale in Arkansas. This tire was installed on the right front of a 1985 Ford 9000 dump truck, which was loaded with gravel and which Philpot was driving when the tire tread belt failed. Philpot alleged that Hankook was negligent in its design, testing, construction, and manufacture of the tire and in its failure to inspect the tire or warn of the defects that it knew or should have known to exist. Philpot further contended that the tire was unfit and unsafe for its intended use and purpose and that Hankook breached an implied warranty. In addition, Philpot sued Mr. Hedrick and Tommy New, the owner of the truck, alleging that they were negligent for failing to properly inspect and maintain the tire for his use.3 All the defendants alleged that Philpot's own negligence contributed to his injuries, and they pursued cross-claims seeking apportionment of liability and damages.
Philpot sent interrogatories and requests for production to Hankook in December 2012. Philpot sought information and documents related to the Hankook Model 240 tire that failed in his case as well as other similar Hankook steel-belted radial medium-truck tires. Specifically, Philpot requested documents regarding Hankook's tire-design process, manufacturing process, prior knowledge and testing concerning tread separations in steel-belted radial medium-truck tires, warranty return data and quality testing in those tires, and other similar incidents—including lawsuits—involving those tires. Hankook produced a few documents in timely fashion but generally limited its responses to the model of tire that failed in Philpot's case. Hankook also objected to several requests for production as seeking documents that were confidential or beyond the scope of the tire that was at issue in the case.
In August 2013, Philpot filed a motion to compel answers to his requests for production and for sanctions arguing that the information he sought was directly relevant to the issues before the court, and Hankook was manifesting a "stonewall approach." Specifically, Philpot argued that Hankook was objecting to any request about its general manufacturing process and was responding only to queries as to the specific model of tire on Philpot's dump truck, only as to the plant where that tire was manufactured, and only those documents created at or within a few years of the tire's manufacture. Philpot also alleged that the few documents that Hankook produced were in Korean and had not been translated.
Hankook resisted the motion to compel in a response filed in September 2013, contending that it was providing reasonably related responses, translating Korean documents into English, and otherwise legitimately objecting to revealing confidential trade secrets.
The circuit court conducted a hearing on the motion to compel on October 17, 2013. The circuit court agreed that Hankook should produce documents regarding other similar tires but declined to impose any sanctions until Hankook had the opportunity to respond to requests that were more limited in scope. Consequently, the circuit court ordered Hankook to respond to several requests for production using the definition of an industry term, "similar green tires," as a guide: "all tire sizes using the same inner liner compound and/or the same belt skim."4 The circuit court also imposed time limitations as necessary, including, as most relevant here, the limitations that Hankook produce all documents reflecting legal action brought against Hankook for similar incidents between January 1, 1995, and December 31, 2005, and that Hankook produce copies of any and all complaints brought against Hankook for similar incidents between the forty-third week of 1998 (when the subject tire was manufactured) and December 31, 2005. The circuit court further ordered that Hankook produce a copy of its document-retention policy.
Hankook served its supplemental responses to Philpot's requests for production on January 10, 2014. While Hankook produced additional documents, several of its supplemental responses claimed that Hankook was no longer in possession of the requested documents for the time specified by the circuit court. Regarding complaints and other documents of legal action, Hankook responded that "to its knowledge it has not had information or documents that are responsive ... in its possession" for the specified time.
On March 19, 2014, Philpot filed a "Motion for Sanctions for Spoliation and Concealment of Evidence" alleging that Hankook's supplemental responses demonstrated that it had destroyed quality-assurance and products-liability documents in contravention of its document-retention policy. Philpot also alleged that Hankook's national counsel, Michael Bai, concealed the existence of other lawsuits involving the Hankook Model 240A tire, which was a "green tire" in the same product line as the Hankook Model 240 tire that was installed on Philpot's dump truck. Specifically, Philpot alleged Hankook's supplemental responses failed to disclose a 2008 case in Talladega County, Alabama, Robinson v. Hankook Tire Manufacturing, Ltd. Philpot also alleged that Mr. Bai falsely represented during the hearing on Philpot's motion to compel that there had been no other lawsuits involving the Hankook Model 240 line of tires. As relief, Philpot requested, inter alia , that the circuit court submit a spoliation instruction to the jury and award reasonable attorney's fees.
The circuit court held a hearing on Philpot's motion for sanctions on September 18, 2014, and it issued findings of fact and conclusions of law on January 21, 2015. The circuit court ruled that due to "the multiple hearings that have been necessitated because of [Hankook's] obtuse and unnecessary abuse of the discovery process" and "to deter any future similar conduct," it was imposing Rule 37 sanctions in the form of reasonable attorney's fees. The circuit court found that the case had been pending for over two years, that Hankook initially responded to the multiple requests for information by providing a small stack of documents primarily in Korean; and produced the documents in English only after a lengthy and exhaustive process. The letter order further stated the following:
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...appellant must show that the circuit court acted "improvidently, thoughtlessly, or without due consideration." Hankook Tire Co. v. Philpot, 2020 Ark. App. 316, 603 S.W.3d 614. John has not made that showing with respect to the attorney-fee award in this case. Affirmed. HIXSON and BROWN, JJ.......