Rexall Drug Company v. Nihill

• Decision Date: 25 April 1960
• Docket Number: No. 16282.,16282.
• Citation: 276 F.2d 637
• Parties: REXALL DRUG COMPANY, a corporation, and Arnold L. Lewis, doing business as Studio Cosmetics Company, Appellants, v. Sandra Mae NIHILL, a Minor, by Her Father and Guardian, John Nihill, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

276 F.2d 637 (1960)

REXALL DRUG COMPANY, a corporation, and Arnold L. Lewis, doing business as Studio Cosmetics Company, Appellants, v. Sandra Mae NIHILL, a Minor, by Her Father and Guardian, John Nihill, Appellee.

No. 16282.

United States Court of Appeals Ninth Circuit.

March 3, 1960.

Rehearing Denied April 25, 1960.

Spray, Gould & Bowers, Reed, Callaway, Kirtland & Packard, Henry E. Kappler, Los Angeles, Cal., for appellants.

Lanier, Lanier & Knox, P. W. Lanier, Jr., Fargo, N. D., for appellee.

Before CHAMBERS, BARNES and JERTBERG, Circuit Judges.

JERTBERG, Circuit Judge.

Appellants appeal from a judgment in damages for personal injury against them in the sum of $48,000 entered in favor of appellee, Sandra Mae Nihill, a minor, following a jury verdict.

Jurisdiction was vested in the district court under the provisions of Title 28 U.S.C.A. § 1332, by reason of diversity of citizenship. The appellee is a citizen of the State of North Dakota. The appellant, Arnold L. Lewis, doing business as Studio Cosmetics Company, is a citizen and resident of the State of California, and the appellant Rexall Drug Company, a corporation, is a corporation organized under the laws of the State of Delaware, and authorized to do business in the State of California.

Appellant, Arnold L. Lewis, was the manufacturer of a home permanent wave preparation, which product was known and sold as Cara Nome Natural Curl Pin Curl Permanent.¹ The product was manufactured and packaged by the appellant Lewis under contract with Rexall Drug Company, which in turn distributed it throughout the United States.

The record discloses that the product used by appellee is designed to curl women's hair and is commonly known as a "home permanent"; that such product made its first appearance on the American market in 1941; that the basic ingredient of the product manufactured and sold by appellants is ammonium thioglycolate, which softens human hair so that it can be shaped; that thioglycolate is the basic ingredient in every cold wave solution on the market; that appellant Lewis first commenced the manufacture of the Cara Nome home kits in 1948 or 1949, under a licensing agreement issued under the so-called McDonald patent, which relates to the use of thioglycolate in cold waving; that several of the other large manufacturers in the United States operate under licensing agreements issued under the same patent; that Lewis had supplied Rexall Drug Company with such product since 1946, although at one time under a different brand name; that Lewis furnished five different types of cold wave home kit preparations to Rexall Drug Company under the Cara Nome brand name, each of which was intended for different types and textures of hair; that the product purchased by appellee was designed for a casual type of wave; that annually Lewis put on the market about 450,000 of the Cara Nome home kits; about 45,000 were of the type purchased by appellee; and that the same formula was used throughout the years. The testimony revealed Rexall Drug Company received about eight complaints annually from users of the Cara Nome product, but no one claimed loss of hair. Such claims were for breakage of hair.

The evidence is undisputed that all cold wave solutions contain from three per cent to ten per cent of thioglycolate, and that the average is in the neighborhood of seven per cent. The product purchased by the appellee came from Batch 181, which was a pin curl batch. This batch produced 10,400 bottles of the pin curl preparation, fifty per cent of which was shipped to the Rexall distributing center in Chicago and fifty per cent to the Rexall distributing center in Georgia. Chemical analysis of this batch revealed the following contents: Ammonium thioglycolate, ammonium hydroxide, opacifier, distilled water, triton 200 and perfume. The thioglycolate content was 7.07 per cent, free ammonia 85 per cent, and the PH factor 9.3 per cent. A sample from the same batch was analyzed and found to contain 6.94 per cent of thioglycolate; the PH factor was 9.2 per cent. This is the measurement of the alkalinity factor.

In her amended complaint to recover damages against the appellants, appellee charged negligence in the manufacture of the preparation against both appellants in one count, and a breach of an express warranty by both appellants in the other count. At the request of appellee's counsel, the issues were narrowed and the case was submitted to the jury against Lewis on the sole issue of negligent manufacture, and against Rexall Drug Company on the sole issue of breach of express warranty.

The underlying issue presented on this appeal is whether the evidence is sufficient to sustain the implied finding of the jury that the application of the home permanent product manufactured by one appellant and distributed by the other was a proximate cause of appellee's loss of hair. In examining this issue, we are required under familiar rules of appellate review to state the evidence in the aspect most favorable to the prevailing party, which we will now proceed to do.

On February 5, 1955, appellee, then 13 years of age, was living with her parents near the small town of Kensal, North Dakota, and on that day appellee's mother purchased a kit of Cara Nome Natural Curl Pin Curl Permanent from a retail drug store in Kensal, North Dakota. The home permanent was thereafter administered to the appellee by a neighbor, appellee's mother also being present to assist in the timing. All three testified that the directions furnished with the home permanent kit were carefully read by them prior to the application of the permanent wave solution, and that such directions were followed. Within a week to ten days after the application appellee began to lose her hair as she combed it. This loss of hair continued for a period of approximately four or five months, at which time she had suffered almost total loss of the hair of her head and eyebrows, part of the hair on her eyelids, and perhaps some of her pubic hair. By the time of the trial, which commenced on April 8, 1958, appellee's hair had partially regrown. There was a conflict in the testimony of the expert witnesses as to whether regrowth would continue.

Appellee's witnesses may be grouped into two categories — medical and lay. The testimony of three medical witnesses was received on behalf of appellee. The first medical witness was Dr. Martin, who was the local family doctor and who was engaged in general practice. He treated the appellee 23 days after the administration of the permanent wave, at which time appellee's hair on her head was gradually falling out. His examination showed extensive loss of hair, some areas of inflammation, and dermatitis. He examined her scalp under the Wood's light and found no evidence of fungus, and prescribed a prescription drug (Abbotts) known as Selsum for the treatment of Seborrheic dermatitis dandruff. Appellee next returned to the doctor on July 6, 1955. At that time appellee had lost practically all of her hair on her head, but he noticed no inflammation or irritation of the scalp. The following questions were asked the doctor, and the following answers given:

"Q. * * * Now, Doctor, based on your medical training and education, based upon your general experience in the practice of medicine, based upon your personal observation, diagnosis, and prognosis, of Sandra Nihill, have you or not an opinion, based upon reasonable medical certainty, as to whether or not the condition of baldness in the scalp, head and hair of Sandra is or is not permanent? * * *

* * * * * *

"A. I have a qualified opinion.

"Q. All right, would you please state that opinion, Doctor? A. Well, I would, my opinion is that this loss of hair may well have been due to the home permanent, but certainly I do not feel it can be proved for sure one way or the other.

"Q. Now, Doctor, I am going to come to that question, because that actually does not quite embody the question which I asked you. My question only asked as to whether or not you felt the loss of hair, and the scalp condition, was permanent, yes or no? A. I didn\'t answer your question directly —

"Q. And now you may answer. A. I feel that there was more probability that this will be a permanent loss of hair than that it will not be, although I am in no position to say definitely one way or the other.

"Q. All right now, Doctor, I want to ask you one more question which you really, in a way, have answered already, but so I get in the foundation to it I want to repeat it. Based upon your medical training and experience, based upon your observation, diagnosis and prognosis of the patient, Sandra Mae Nihill, do you have an opinion, based upon reasonable medical certainty, as to whether or not the application of a cold waving, cold wave solution to the scalp of Sandra Nihill, on or about February 5th, 1955, containing a chemical solution of ammonium thioglycolate, could cause the condition of the scalp that existed as you saw in Sandra Nihill on February 28th, 1955, and July 6th, 1955?

* * * * * *

"A. I feel, from the presence of the inflammation in her scalp, and the absence of any evidence of fungus infection under the Wood\'s light, that this condition which I saw on her scalp and in her scalp on the 28th of February, 1955, may well have been due to a chemical irritant such as you mentioned was in the home permanent."

The second medical witness was Dr. Melton, a dermatologist of Fargo, North Dakota, who examined the appellee on August 9, 1955. Examination by the witness revealed that appellee's hair was short all over her head; there were dark hairs interspersed with very fine hairs; there were many dark hairs broken off at the roots; there had been loss of eyebrows. The hair of the axillae arm pits and pubic area was sparse, but the mother of appellee stated to the witness that this was a family trait. The witness found no inflammation of the scalp or scaling, but found some...