Warren v. Shelter Mut. Ins. Co.

• Decision Date: 29 June 2016
• Docket Number: No. 15–354.,15–354.
• Citation: 196 So.3d 776
• Parties: Ron WARREN, Individually and on Behalf of the Estate of Derek Hebert v. SHELTER MUTUAL INSURANCE COMPANY, et al.
• Court: Court of Appeal of Louisiana — District of US

196 So.3d 776

Ron WARREN, Individually and on Behalf of the Estate of Derek Hebert

v.SHELTER MUTUAL INSURANCE COMPANY, et al.

No. 15–354.

Court of Appeal of Louisiana, Third Circuit.

June 29, 2016.

Rehearing Denied Aug. 3, 2016.

Anthony M. Fazzio, Barton W. Bernard, Lafayette, LA, Steven Broussard, Steven R. Hart, Aaron Broussard, Broussard & Hart, LLC, Lake Charles, LA, for Plaintiff/Appellee, Ron Warren, Individually and on Behalf of the Estate of Derek Hebert.

David R. Frohn, Manion Gaynor & Manning LLP, Jeffery D. Fruge, The Thibodeaux Law Firm, LLC, Lake Charles, LA, H. Alston Johnson, III, Phelps Dunbar LLP, Baton Rouge, LA, for Defendant/Appellant, Teleflex, Inc.

Rudie R. Soileau, Jr., Lundy, Lundy, Soileau & South, LLP, Lake Charles, LA, for Defendant/Appellee, Glen D. Vamvoras.

Richard D. Chappuis, Jr., Voorhies & Labbe, Lafayette, LA, for Defendant/Appellee, Bowtie Marina.

Maurice L. Tynes, Maurice L. Tynes & Associates, Lake Charles, LA, for Defendant/Appellee, Daniel Vamvoras.

Vernon Ed McGuire, III, Plauche', Smith & Nieset, Lake Charles, LA, for Defendants/Appellees, Richard Gandy, Michael Torres, Progressive Security Insurance Company, and Logan Gandy.

James Ryan, III, James Ryan III & Associates, LLC, New Orleans, LA, for Defendant/Appellant, Harold Dyke d/b/a Harold's Marine.

Joshua S. Force, Kevin M. McGlone, Sher Garner Cahill Richter Klein & Hilbert, L.L.C., New Orleans, LA, Francis P. Manchisi, Wilson Elser Moskowitz Edelman & Dicker LLP, White Plains, NY, for

National Marine Manufacturers Association.

Iain L. Kennedy, Shook, Hardy & Bacon L.L.P., Miami, FL, Mark A. Behrens, Cary Silverman, Shook, Hardy & Bacon L.L.P., Washington, DC, for Louisiana Association of Business and Industry.

Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, JIMMIE C. PETERS, and JOHN E. CONERY, Judges.

THIBODEAUX, Chief Judge.

Plaintiff-appellee Ron Warren, individually and on behalf of the Estate of Derrek Hebert, filed a petition for damages seeking to recover for the wrongful death of his son, Derek Hebert, in a recreational boating accident under general maritime law and products liability. The defendant, Teleflex, Inc. (Teleflex), was found liable and appeals various judgments casting it for compensatory damages of $125,000, punitive damages of $23,000,000, and legal interest. Mr. Warren also appeals a judgment on judicial interest. There are three consolidated appeals. For the reasons expressed below, we affirm the judgments of the trial court on all issues.

I.ISSUES

We must decide:

(1) whether the trial court erred in granting directed verdicts to defendants Glen and Daniel Vamvoras in the first trial;

(2) whether the trial court abused its discretion in granting the plaintiff a new trial;

(3) whether the trial court erred in failing to instruct the jury on the duties of a component part manufacturer;

(4) whether the trial court erred in failing to bifurcate the adjudication of compensatory and punitive damages in the second trial;

(5) whether the jury abused its discretion or manifestly erred in awarding punitive damages in the second trial;

(6) whether the jury abused its discretion in awarding excessive punitive damages;

(7) whether the trial court erred in awarding prejudgment interest on compensatory damages; and

8) whether the trial court erred in denying prejudgment interest on punitive damages.

II.FACTS AND PROCEDURAL HISTORY

This accident occurred on May 7, 2005, on the navigable inland waters of Louisiana, between the Lake Charles Country Club and the home of Lake Charles attorney Glen Vamvoras, located on a former channel of the Calcasieu River. Derek Hebert was a passenger in a Champion boat owned by Glen Vamvoras and operated by his son Daniel Vamvoras. The Champion's steering failed while the boat was on plane. The boat went into a spin, throwing Derek Hebert overboard. The boat's propeller struck him nineteen times, causing his death. His parents brought survival and wrongful death claims and sought punitive damages against several defendants.

The defendants included Glen and Daniel Vamvoras, as well as drivers of another boat which collided with the Vamvoras boat after Derek was ejected, various marinas, insurers, and three manufacturers. The mother's claim was settled after mediation, and her suit was dismissed. The father, Ron Warren, proceeded with his wrongful death and survival action under general maritime law, seeking compensatory damages, punitive damages, and judicial interest thereon. Litigation continued for approximately nine years. By the time of trial, the remaining defendants were Glen Vamvoras, Daniel Vamvoras, and Teleflex.

The Louisiana Department of Wildlife & Fisheries (Wildlife & Fisheries) investigated the accident and determined that the boat, which had been purchased pre-owned by Glen Vamvoras, lost its steering because of a hydraulic oil/fluid leak in one of the steering system's hydraulic lines at a hose/nut or coupling assembly. Teleflex manufactured and supplied the boat's hydraulic steering system, but one of the original Teleflex hoses had been replaced by persons unknown with a non-Teleflex hydraulic hose. The remaining claim against Teleflex at the time of trial was not for construction or design defects. The claim asserted is that the steering system is defective because it contains an inherent danger unknown to users, and Teleflex breached its duty to warn unsuspecting users of a dangerous risk in using its product.

As a result of the proceedings below, including two trials and various post-trial motions and hearings, there are three consolidated appeals pending before this court under docket numbers 15–354, 15–838, and 15–1113.

The trial court granted directed verdicts to Glen Vamvoras and Daniel Vamvoras, and to Bowtie Marina, one of the marina defendants, dismissing them from the suit in the first jury trial. These dismissals left Teleflex as the only defendant on the jury verdict form. The jury found in favor of Teleflex, and the trial court signed a September 30, 2014 judgment dismissing Mr. Warren's claims against Teleflex. However, the trial court subsequently granted Mr. Warren's motion for new trial based on prejudicial error during the first trial.

At the conclusion of the second trial, the jury rendered a verdict in favor of Mr. Warren and against Teleflex, awarding compensatory damages of $125,000 and punitive damages of $23,000,000. Based on the jury's verdict, the trial court entered a December 29, 2014 judgment in favor of Mr. Warren awarding the above amounts. Although neither party had introduced evidence on the issue of judicial interest, and that issue was not submitted to the jury, the trial court also awarded prejudgment interest on compensatory damages from the date of judicial demand.

Both Mr. Warren and Teleflex filed post-trial motions after the second trial. Teleflex sought a JNOV, or in the alternative a new trial or a remittitur on punitive damages. Mr. Warren sought a JNOV confirming the award of interest on compensatory damages and sought prejudgment interest on punitive damages from the date of the accident or, alternatively, from the date of judicial demand.

While the post-trial motions on the second trial were pending, Teleflex appealed from the directed verdicts in the first trial. Teleflex's first appeal is docketed in this court as appeal No. 15–354.

Following a hearing on June 17, 2015, the trial court entered two judgments. One judgment denied Teleflex's post-trial motions for JNOV or new trial or remittitur on the punitive damage award. Another judgment granted Mr. Warren's motion for JNOV as to legal interest on compensatory damages but denied his JNOV as to interest on punitive damages.

Mr. Warren filed a devolutive appeal from the December 29, 2014 judgment and the June 17, 2015 judgment, regarding legal interest on punitive damages. His appeal is docketed in this court as No. 15–838.

Teleflex filed a suspensive appeal from the December 29, 2014 judgment awarding compensatory and punitive damages to Mr. Warren, and from the June 17, 2015 judgment denying its post-trial motions for JNOV or new trial or remittitur on punitive damages. Teleflex's appeal from the second trial is docketed in this court as No. 15–1113.

We have consolidated Teleflex's appeal No. 15–354 from the directed verdicts in the first trial with Mr. Warren's devolutive appeal No. 15–838 on legal interest and with Teleflex's suspensive appeal No. 15–1113 on various issues, including the granting of the new trial to the plaintiff and four assigned errors arising from the second trial. We will address all issues raised in the three consolidated appeals, by docket number. However, because Teleflex's appeal No. 15–1113 appeals two judgments and covers five issues, we will address it second, and we will address Mr. Warren's appeal No. 15–838 last. We begin with Teleflex's appeal No. 15–354.

III.LAW AND DISCUSSIONAPPEAL NUMBER 15–354

Directed Verdicts

Teleflex contends that the trial court erred in granting directed verdicts in favor of Glen and Daniel Vamvoras in the first trial, arguing the Vamvorases either knew or should have known of the unreasonable risk of harm associated with a loss of fluid in the hydraulic system. We find that the trial court properly granted the directed verdicts.

On appeal, “legal sufficiency of the evidence challenges, such as those presented by ... motions for directed verdict ... are subject to the de novo standard of review that is used for all legal issues.” Hall v. Folger Coffee Co., 03–1734, p. 10 (La.4/14/04), 874 So.2d 90, 99. “[T]he applicable standard of review on a motion for directed verdict is whether the evidence in the record is such that a reasonable person could not reach a verdict to the contrary.” Richard v. Artigue, 11–1471, p. 4 (La.App. 3 Cir. 4/4/12), 87 So.3d 997, 1001.

In order to find Glen or Daniel at fault for Derek Hebert's death, Teleflex must have satisfied the requirements of La.Civ.Code art. 2317.1, which states in...