Wright v. Brooke Group Ltd.

Iowa Supreme Court · Torts

Tortsproducts liabilitydesign defectfailure to warnfraud by nondisclosurecivil conspiracyimplied warranty of merchantabilitymanufacturing defect

Facts

Robert and DeAnn Wright sued several cigarette manufacturers for injuries allegedly caused by Robert Wright's cigarette smoking. The petition alleged negligence, strict liability, breach of implied and express warranty, breach of special assumed duty, fraudulent misrepresentation, fraudulent nondisclosure, and civil conspiracy. After the federal district court largely overruled the manufacturers' motion to dismiss, it certified eight state-law questions to the Iowa Supreme Court. The certified questions focused on how Iowa law treats design defects, common knowledge of smoking risks, conspiracy, fraud by nondisclosure, assumed duty, manufacturing defects, and implied warranty claims involving cigarettes.

Issue

What standards govern Iowa product-liability, warranty, fraud, conspiracy, and assumed-duty claims in this cigarette-injury case? More specifically, the court had to decide the governing design-defect test, whether comment i to Restatement (Second) § 402A still applied, how common knowledge affects liability, whether conspiracy can rest on non-intentional tortious conduct, when nondisclosure by a manufacturer is actionable as fraud, whether advertisements create a § 323 undertaking, and whether intended-condition cigarettes can support manufacturing-defect or merchantability claims.

Rule

Iowa adopts Restatement (Third) of Torts: Product Liability §§ 1 and 2 for product defect cases. A design defect claim requires proof that the foreseeable risks of harm posed by the product could have been reduced or avoided by adoption of a reasonable alternative design and that omission of that design rendered the product not reasonably safe. Consumer expectations and common knowledge are relevant but not controlling in design-defect analysis, and obvious or generally known risks may defeat a warning claim only depending on the facts. Civil conspiracy may be based on underlying actionable tortious conduct even if that conduct is not an intentional tort. In a manufacturer-consumer relationship, fraud by nondisclosure arises only when disclosure is needed to prevent the manufacturer's prior statement from being misleading or when later-acquired information makes a prior statement misleading. No manufacturing defect exists when the product conforms to its intended design, and implied warranty of merchantability for personal injury tracks product-defect principles under Restatement (Third) § 2.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Des Moines, Nora Kim was injured when a countertop food slicer manufactured by Prairie Crest Appliances severed her fingertip during ordinary use. She sues, alleging the slicer should have included an interlocking blade guard that engineers had already tested, and that the added guard would have prevented most hand-contact injuries without preventing the slicer from functioning.

Under Iowa law as stated by the majority, what must Nora prove to prevail on her design-defect claim?

Explanation. For design defects, Iowa adopted Restatement (Third) of Torts § 2(b). The plaintiff must prove the foreseeable risks could have been reduced or avoided by adopting a reasonable alternative design and that omission of that alternative rendered the product not reasonably safe. Consumer expectations are relevant but not an independent controlling standard. (Derived from Wright v. Brooke Group Ltd. (n.d.).)