Whitaker v. T.J. Snow Co., 97-1596

• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)
• Citation: 151 F.3d 661
• Docket Number: No. 97-1596,97-1596
• Parties: Prod.Liab.Rep. (CCH) P 15,315 Naomi WHITAKER, Plaintiff-Appellant, v. T.J. SNOW CO., Defendant-Appellee.
• Decision Date: 06 August 1998

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151 F.3d 661 Prod.Liab.Rep. (CCH) P 15,315 Naomi WHITAKER, Plaintiff-Appellant,
v.
T.J. SNOW CO., Defendant-Appellee. No. 97-1596. United States Court of Appeals,
Seventh Circuit. Argued Oct. 24, 1997.
Decided Aug. 6, 1998.

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Edward L. Murphy, Jr., Larry L. Barnard (argued), Miller, Carson, Boxberger & Murphy, Fort Wayne, IN, Dale J. Starkes, Winamac, IN, for Plaintiff-Appellant.

John C. Hamilton (argued), John E. Doran, Doran, Blackmond, Ready, Hamilton & Williams, South Bend, IN, for Defendant-Appellee.

Before COFFEY, EASTERBROOK, and DIANE P. WOOD, Circuit Judges.

DIANE P. WOOD, Circuit Judge.

One unintended effect of the workers' compensation scheme in force in virtually every state has been to create an incentive for employees injured on the job to look for entities other than the employer who might be responsible (and able to pay) for the full consequences of their job-related injuries. The scope of products liability law, in turn, has in many cases pointed the way to potential defendants: even if the injured employee is limited in her remedies against the employer, she can require the company that manufactured an unreasonably dangerous product that caused her injuries to pay damages. That, in general, is what Naomi Whitaker is attempting to do in this case. While she was working at her job as a welder at the Walker Manufacturing Company, Whitaker's hand was injured by a machine that had been refurbished (but not originally manufactured) by appellee T.J. Snow Company about five years earlier. Whitaker's claim was tried with the consent of the parties before a magistrate judge, see 28 U.S.C. § 636(c), who eventually entered summary judgment for Snow. See Whitaker v. T.J. Snow, Co., 953 F.Supp. 1034 (N.D.Ind.1997). Whitaker has appealed from that judgment.

The machine that injured Whitaker was a "catalytic converter seam welder" manufactured and sold in 1979 to Walker by RWC, Inc. (which originally was also a defendant, but is now out of the case). In February or March 1988, Walker decided to upgrade the electrical circuits of the seam welder, and it solicited a bid for that work from Snow. In the request for bids, Walker specified all equipment that was to be used in the project. Snow responded with a shop order dated April 15, 1988, which stated that Snow would add to the machine Walker's specified Gould three-axis programming unit, install a new water circuit, air circuit, and Weltronic WT-900 weld control, design and build a water catch basin/tray with outlet, and clean and paint the machine. The shop order also specifically said that "[t]he basic welder [was] ... not to be rebuilt." Walker accepted Snow's bid, and work proceeded according to plans. Snow performed some additional design work that enabled it to use the component parts Walker had specified. Snow did not design the component parts themselves, nor did it change the welder's mechanical function. The parties agree that the work Snow performed had the effect of extending the useful life of the machine, even though the machine had some useful life remaining when Snow received it. The total cost of the work Snow performed was $61,065; a new seam welder at the time would have cost about $100,000.

Snow returned the seam welder to Walker on May 27, 1988. Normally, before it returns something to a customer, Snow checks

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over the item to see if it complies with all applicable safety regulations, including those issued by the Occupational Safety and Health Administration (OSHA), the American National Standards Institute (ANSI), and the Resistance Welders Manufacturers Association (RWMA). If Snow spots a problem, it usually tells the customer orally, and then follows up in writing. In this case, Snow was supposed to inspect the seam welder and determine if any guarding was necessary for so-called pinch points on the machine, and if so, either to furnish the guards or tell Walker they were needed. Although Snow inspected the machine, because the order was a rush job, it failed to install guards, to warn Walker orally or in writing, or to place warning stickers or decals on the exposed pinch points. This was unfortunate because the seam welder was not in compliance with OSHA regulations when Snow returned it to Walker. When Walker received the seam welder back from Snow, the only guarding on the pinch points were on the two hand controls--and even those guards were insufficient under the relevant OSHA regulations. This non-compliance with OSHA regulations may not have been unusual, however, because by industry convention the customer normally shipped Snow a "bare bones" machine, and the customer retained the responsibility for re-installing the guards afterwards. That is precisely what occurred in the case of the seam welder that injured Whitaker.

As of the day of the injury, September 18, 1993, Whitaker had been a Walker employee for only six days; she had operated the seam welder for five of those days. On the second day of her employment, Tim Kaizer (whose name is spelled several ways in the record), another Walker employee, had showed her how to operate the seam welder and how to examine the weld. Other Walker employees instructed Whitaker what to do when, during the welding process, small molten particles of metal spattered on the seam welder's wheels. When this happened, Whitaker was told to chisel the metal beads off the wheel. The accident did not occur while she was actually in the process of welding. Instead, it occurred after she observed spattered metal adhering to the wheels and, as she had been instructed, she reached inside an opening on the seam welder to attempt to knock the weld beads off with a chisel. Unfortunately, the seam welder was in the middle of a weld cycle, and while she was doing this, the machine...