Torres v. Goodyear Tire & Rubber Co., Inc.
| Decision Date | 15 February 1989 |
| Docket Number | No. 87-2062,87-2062 |
| Citation | 867 F.2d 1234 |
| Parties | Prod.Liab.Rep.(CCH)P 12,080 Andrew TORRES; Amanda Torres, husband and wife; Walter Torres; Debra Torres, Plaintiffs-Appellants, v. GOODYEAR TIRE & RUBBER COMPANY, INC., an Ohio Corporation, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Richard D. Engler, Engler, Engler, Weil & Nelson, Yuma, Ariz., for plaintiffs-appellants.
Jefferson L. Lankford, Jennings, Strouss & Salmon, Phoenix, Ariz., for defendant-appellee.
Appeal from the United States District Court for the District of Arizona.
Before SNEED, HALL and NOONAN, Circuit Judges.
The opinion in this case, filed September 15, 1988, and appearing at 857 F.2d 1293, is hereby withdrawn and the following "Opinion and Order Certifying Question to the Arizona Supreme Court" is substituted.
The opinion having been withdrawn, the petition for rehearing is rendered moot. The full court having been advised of the suggestion for rehearing en banc, and no active judge having called for rehearing en banc, the suggestion for rehearing en banc is rejected.
Plaintiffs-appellants the Torreses sue to recover for personal injuries suffered as a result of an automobile accident. The Torreses assert four theories under which they believe defendant-appellee Goodyear Tire & Rubber Company ("Goodyear") should be held liable for their injuries: (1) the "apparent manufacturer" doctrine; (2) principles of apparent agency or agency by estoppel; (3) the Arizona law of manufacturers' warranties; and (4) the "enterprise theory" of strict products liability.
The district court exercised diversity jurisdiction pursuant to 28 U.S.C. Sec. 1332(a)(1) (1982). The district court granted summary judgment in favor of Goodyear, concluding that "neither the Arizona courts nor the Arizona legislature have accepted the expansive liability doctrines argued by the plaintiffs."
We have jurisdiction pursuant to 28 U.S.C. Sec. 1291 (1982). As to appellants' first three theories of liability, we affirm the district court's summary judgment in favor of Goodyear. Whether appellants may rely on an "enterprise theory" to hold Goodyear strictly liable for their injuries is a question we certify to the Arizona Supreme Court pursuant to Ariz.Sup.Ct.R. 27 (1988).
The pertinent facts, briefly stated, are as follows. Andrew and Walter Torres were injured in an automobile accident allegedly caused by the tread separation of a tire on an automobile driven by Walter, a 1977 Triumph manufactured in Great Britain. The tire was original equipment on the automobile which was purchased by Walter's wife, Debra. The car's allegedly defective tire bore the legend "Goodyear."
The tire was manufactured in Wolverhampton, England by Goodyear Tyre & Rubber (Great Britain), Ltd. ("Goodyear GB"). Goodyear International Technical Center ("Goodyear Technical Center"), a division of Goodyear SA of Luxembourg, designed the tire. Either Goodyear SA of Luxembourg or Goodyear GB issued the tire specifications. According to the Torreses, Goodyear operates its foreign subsidiaries, with the exception of its Canadian subsidiary, through Goodyear International Corporation.
Goodyear GB, Goodyear SA of Luxembourg, and Goodyear International Corporation are all Goodyear subsidiaries. Because Goodyear owns most or all of its subsidiaries' stock, it is able to elect the corporate directors and thereby control the subsidiaries. There is commonality between some of the officers and directors of Goodyear and its subsidiaries.
Goodyear's support for its tires extends from research and development to trademark licensing, and from warranting to advertising. Goodyear's trademark is registered and its use is conditioned on Goodyear's control of the manufacturer. Goodyear is responsible for quality assurance and control of all tires manufactured by its foreign subsidiaries. It will honor any valid warranty claim on a tire that bears a Goodyear trademark and is produced by either Goodyear or a foreign subsidiary.
Pursuant to a licensing agreement with Goodyear, Goodyear GB may manufacture tires bearing the Goodyear trademark. The Licensing Agreement provides for manufacture of the tires in accordance with the formulas, specifications, and directions given by Goodyear. Only materials approved by Goodyear may be used. Goodyear GB must comply with Goodyear's instructions on production, labeling, marketing, and packaging of these tires.
We review the grant of summary judgment de novo. California Architectural Bldg. Products, Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir.1987), cert. denied, --- U.S. ----, 108 S.Ct. 698, 98 L.Ed.2d 650 (1988). Under Fed.R.Civ.P. 56(c), summary judgment is appropriate if the pleadings and supporting materials "show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."
As a federal court sitting in diversity, we must apply Arizona substantive law. See Erie Railroad Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). We review de novo the district court's determination of the applicable state law. In re McLinn, 739 F.2d 1395, 1400 (9th Cir.1984) (en banc).
The Torreses contend that Goodyear should be held strictly liable under section 400 of the Restatement (Second) of Torts because it was the apparent manufacturer of the tire. Section 400 states that "[o]ne who puts out as his own product a chattel manufactured by another is subject to the same liability as though he were its manufacturer."
We reject this argument. First, Arizona has not adopted the apparent manufacturer doctrine. Second, even if section 400 were adopted by the Arizona Supreme Court, Goodyear did not "put out" the allegedly defective tire within the section's meaning. The cases which apply the apparent manufacturer doctrine demonstrate that section 400 applies only where a retailer or distributor has held itself out to the public as the manufacturer of the product. See Dudley Sports Co. v. Schmitt, 151 Ind.App. 217, 279 N.E.2d 266 (1972) (distributor); Burkhardt v. Armour & Co., 115 Conn. 249, 161 A. 385 (1932) (). Accord Affiliated FM Ins. Co. v. Trane, 831 F.2d 153, 155-56 (7th Cir.1987); Nelson v. International Paint Co., 734 F.2d 1084, 1087-90 (5th Cir.1984) ().
Goodyear was not the manufacturer of the allegedly defective tire. Furthermore, Goodyear was not the seller of the tire to which section 400 imputes the actual manufacturer's liability. Accordingly, the Torreses' reliance on section 400 to impose liability on Goodyear is misplaced.
The Torreses next assert that principles of apparent agency or agency by estoppel compel treatment of Goodyear GB as an agent of Goodyear. In Arizona, the touchstone of apparent agency is the "conduct of a principal that allows a third party reasonably to conclude that an agent is authorized to make certain representations or act in a particular way." Miller v. Mason-McDuffie Co. of So. Cal., 153 Ariz. 585, 589, 739 P.2d 806, 810 (1987) (en banc). "[I]f the principal's conduct creates apparent authority, the principal is subject to liability for the agent's actions even if the agent was acting for his own purposes." Id. As to this theory, Goodyear has shown that there is no genuine issue of material fact.
The Torreses have pointed to no evidence that Goodyear created the impression that Goodyear GB acted as its agent. Goodyear advertising might create the impression that tires with the Goodyear trademark are of outstanding quality. That impression, however, in and of itself does not reasonably lead to the conclusion that anyone using the Goodyear trademark is a Goodyear agent whose corporate separateness should be disregarded.
Even if the Torreses could demonstrate that there was a material dispute of fact about whether Goodyear represented Goodyear GB as its agent, they must still show that Debra Torres, when she purchased the Triumph together with its Goodyear tires, reasonably relied upon the agent's apparent authority. Id. at 590, 739 P.2d at 811; Koven v. Saberdyne Systems, Inc., 128 Ariz. 318, 322, 625 P.2d 907, 911-12 (Ct.App.1980). The Torreses cannot claim, however, that Debra Torres believed that Goodyear GB acted as an agent of Goodyear. When she purchased the Triumph, she was unaware of Goodyear GB.
The Torreses also attempt to base Goodyear's liability upon two warranty theories derived from Flory v. Silvercrest Industries, Inc., 129 Ariz. 574, 633 P.2d 383 (1981) (en banc). As to these theories as well, Goodyear was entitled to summary judgment. Neither theory supports the Torreses' claim because both are based upon an express warranty given by the manufacturer. Here, the Torreses have presented no evidence of a similar warranty by Goodyear. Moreover, Goodyear was not the manufacturer of the defective tire and the record is clear that Debra Torres did not rely on any Goodyear warranty in purchasing the Triumph, which happened to have Goodyear tires.
Finally, the Torreses claim that Goodyear is liable under an "enterprise theory" of strict products liability. The district court found that this claim lacked an essential element of strict liability under Arizona statutory and case law: the defendant must have designed, manufactured or sold the defective product.
Arizona has adopted section 402A of the Restatement (Second) of Torts which imposes strict liability on "[o]ne who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property." In Tucson Industries, Inc. v. Schwartz, 108 Ariz. 464, 501 P.2d 936 (1972), the Arizona Supreme Court explained strict liability as a rule placing the burden of loss on " 'those persons who are in the chain of...
To continue reading
Request your trial
-
Richardson v. City and County of Honolulu, Civ. No. 91-00725 DAE.
...Ins. Co., 899 F.2d 875 (9th Cir.1990); Kunz v. Utah Power & Light Co., 871 F.2d 85, 87-88 (9th Cir.1989); Torres v. Goodyear Tire & Rubber Co., 867 F.2d 1234, 1237-39 (9th Cir.1989); Toner for Toner v. Lederle Labs., 779 F.2d 1429, 1432-34 (9th Cir.1986); Aetna Ins. Co. v. Craftwall of Idah......
-
Patterson v. Home Depot, USA, Inc.
...property, this licencing agreement, without more, is insufficient to establish an agency relationship. See Torres v. Goodyear Tire & Rubber Co., 867 F.2d 1234, 1236-39 (holding that licencing agreements do not in and of themselves create an agency relationship under Arizona law). Plaintiffs......
-
Boomer Dev., LLC v. Nat'l Ass'n of Home Builders of the United States
...by state precedent," Philadelphia v. Beretta U.S.A. Corp. , 277 F.3d 415, 421 (3d Cir. 2002). See also Torres v. Goodyear Tire & Rubber Co. , 867 F.2d 1234, 1238 (9th Cir. 1989) (Federal courts sitting in diversity should "hesitate prematurely to extend the law ... in the absence of an indi......
-
IN RE EASTERN AND SOUTHERN DISTRICTS ASBESTOS LIT.
...seen fit to assume such a posture of restraint when it comes to deciding novel questions of state law. Torres v. Goodyear Tire & Rubber Co., 867 F.2d 1234, 1238 n. 1 (9th Cir.1989) (citations omitted); see also Cooper v. American Airlines, 149 F.2d 355, 359 (2d Cir.1945) ("What would be the......
-
CERTIFICATION COMES OF AGE: REFLECTIONS ON THE PAST, PRESENT, AND FUTURE OF COOPERATIVE JUDICIAL FEDERALISM.
...Id. (citation omitted) (citing Jaramillo v. Weyerhaeuser Co., No. 03-Civ-1592(NRB), 2007 WL 194011, at *5 (S.D.N.Y. Jan 24, 2007)). (96) 867 F.2d 1234 (9th Cir. (97) Id. at 1235. (98) Id. at 1237. (99) Id. at 1235-36. (100) Id. at 1237-38. (101) Id. at 1238. (102) Id. at 1238-39. (103) Id. ......
-
Franchisors in a Jam: Vicarious Liability and Spreading the Blame.
...389 N.E.2d 155, 163 (1979), cert. denied & appeal dismissed, 444 U.S. 1060 (1980); Torres v. Goodyear Tire & Rubber Co., Inc., 867 F.2d 1234, 1238 (9th Cir. 1989); Combs v. Int'l Ins. Co., 354 F.3d 568, 577 (6th Cir. 2004); Watson v. Dillon Cos., 797 F. Supp. 2d 1138, 1162 (D. Colo.......