By Adam S. Ira
The Indiana Product Liability Act (IPLA) can prove confusing for litigants unfamiliar with its many nuances. As is often the case, the defense finds itself representing one or more entities that were in some manner connected with the sale or distribution of a product that allegedly causes an injury to an end user. While the burden of proving duty, breach, causation, and damages rests with the plaintiff in a civil action, in practice, defense attorneys are often tasked with extricating a defendant that has no duty of care with respect to the specific claims brought against it.
One example occurs when a nonmanufacturing seller or distributor of a product is alleged to have failed to warn the plaintiff of an alleged defect that becomes apparent after the product was sold and was not adequately addressed by the manufacturer’s warnings and instructions for safe use.
This article addresses the question: Does a nonmanufacturing seller have a duty to provide warnings and instructions for safe use other than those provided by the original manufacturer? Courts around the country give different answers, but under the IPLA, a seller has a duty to provide additional or different warnings and instructions for safe use only when the manufacturer’s warnings are insufficient and if “special circumstances” exist.
There are compelling policy implications against imposing a duty on nonmanufacturing sellers and distributors to provide additional or different warnings and instructions for safe use.
Charging a nonmanufacturing seller or distributor with a duty to provide additional warnings or instructions for safe use creates several problems. Imposing such a duty may dissuade sellers and distributors from sharing information necessary for a manufacturer to discover and remedy product defects. If retailers are dissuaded from communicating with manufacturers about the dangers of a product out of fear of assuming a duty to warn or provide instructions, they may choose not to assist manufacturers by providing information that may be useful in discovering potential defects.
In addition, holding nonmanufacturing sellers to an independent duty to warn would effectively require them to know as much about the design and operation of products as the manufacturer itself. The Indiana Supreme Court has found this an “untenable position and an unnecessary burden.” See Ford Motor Co. v. Rushford, 868 N.E.2d 806, 811-12 (Ind. 2007).
Perhaps the most compelling argument against imposing an independent duty to warn on nonmanufacturing sellers is that it could be dangerous for a seller to tinker with warnings and instructions for a product it did not design. Imagine the chaos that would ensue if end users were to receive conflicting warnings or instructions for safe use from multiple sellers of a product.
What is the restatement view?
With respect to the duty to warn and provide instructions for safe use, Restatement (Third) of Torts: Prod. Liab. § 2 (1998) provides:
A product … is defective because of inadequate instructions or warnings when the foreseeable risks of harm posed by the product could have been reduced or avoided by the provision of reasonable instructions or warnings by the seller or other distributor, or a predecessor in the commercial chain of distribution, and the omission of the instructions or warnings renders the product not reasonably safe.
Comment o. to the Restatement § 2 provides:
Nonmanufacturing sellers such as wholesalers and retailers often are not in a good position feasibly to adopt safer product designs or better instructions or warnings. Nevertheless, once it is determined that a reasonable alternative design or reasonable instructions or warnings could have been provided at or before the time of sale by a predecessor in the chain of distribution and would have reduced plaintiff’s harm, it is no defense that a nonmanufacturing seller of such a product exercised due care. Thus, strict liability is imposed on a wholesale or retail seller who neither knew nor should have known of the relevant risks, nor was in a position to have taken action to avoid them, so long as a predecessor in the chain of distribution could have acted reasonably to avoid the risks.
Restatement (Third) of Torts: Prod. Liab. § 2 cmt. m (1998) further provides:
Product sellers and distributors are not required to foresee and take precautions against every conceivable mode of use and abuse to which their products might be put. A seller bears responsibility to perform reasonable testing prior to marketing a product and to discover risks and risk-avoidance measures that such testing would reveal. A seller is charged with knowledge of what reasonable testing would reveal. If testing is not undertaken, or is performed in an inadequate manner, and this failure results in a defect that causes harm, the seller is subject to liability for harm caused by such defect.
Thus, the Restatement would seem to impose a nebulous duty to warn or provide potentially different instructions for use at the time of sale.
The IPLA’s requirements are narrower than the restatement.
With the Restatement framework in mind, the question is when, if at all, under the IPLA does a seller/distributor of a product to an Indiana consumer have a duty to provide different or additional warnings/instructions for safe use with respect to a product it neither designed nor manufactured? The short answer is only when the manufacturer’s warnings and instructions are ineffective and when “special circumstances” are present.
With respect to claims arising under a theory of failure to warn, the IPLA provides that:
A product is defective … if the seller fails to:
(1) properly package or label the product to give reasonable warnings of danger about the product; or
(2) give reasonably complete instructions on proper use of the product;
when the seller, by exercising reasonable diligence, could have made such warnings or instructions available to the user or consumer.
Ind. Code § 34-20-4-2 (Current through 2021). “‘Seller,’ for purposes of IC 34-20, means a person engaged in the business of selling or leasing a product for resale, use, or consumption.” Ind. Code § 34-6-2-136 (Current through 2021).
“A seller has a duty to warn only when the seller knew or had reason to know that the product was likely to be dangerous when used in a foreseeable manner.” Underly v. Advance Mach. Co., 605 N.E.2d 1186, 1192 (Ind. Ct. App. 1993) (superseded on other grounds); see also Hinkle v. Niehaus Lumber Co., 525 N.E.2d 1243, 1245 (Ind. 1988) (There must be evidence that the supplier knew or had reason to know that the product was likely to be dangerous when used in a foreseeable manner). The duty to warn of “latent danger[s] inherent in the product’s use” is a duty “to warn of the hidden danger itself, or the risks from a recognized danger that far exceed that contemplated by the ordinary consumer.” Simpson v. Gen. Dynamics Ordnance & Tactical Sys.-Simunition Operations, Inc., 429 F. Supp. 3d 566, 579 (N.D. Ind. 2019). A seller with knowledge that a product involves danger to users has a duty to give a warning of such danger at the time of sale and delivery. See Nat. Gas Odorizing, Inc. v. Downs, 685 N.E.2d 155, 162 (Ind. Ct. App. 1997).
The Indiana Supreme Court examined the issue of whether a nonmanufacturing seller was obliged to provide additional or different warnings from those of the manufacturer in Ford Motor Co. v. Rushford, 868 N.E.2d 806 (Ind. 2007). In Rushford, the plaintiff (4’ 11” tall) was injured by an airbag that deployed in a vehicle in which she was riding. Rushford claimed that the dealership that sold her the car knew she was short and should have warned her about the risk of harm to a short individual presented by an airbag. She also told the dealership she had never driven a car before. The warnings in the car itself pertained only to the risk of harm presented by airbags to children and did not reference the risk of injury to short adults. Rushford argued the dealership, which had knowledge of her height and inexperience driving cars, owed her a duty to inform her that the owner’s manual for the car contained warnings regarding the risk of harm presented by the airbags to a person of her height. The Indiana Supreme Court reasoned “a retail merchant has a duty to warn a buyer of the danger posed by a product it sells. However, absent special circumstances not present in this case, if the manufacturer provides adequate warnings of the danger of the product and the seller passes these warnings along to the buyer or consumer, then the seller has discharged its duty to warn.” Ford Motor Co. v. Rushford, 868 N.E.2d 806, 807 (Ind. 2007) (emphasis added). The court gave no indication as to what it meant by “special circumstances,” and an examination of the filings in the case indicates it does not appear to be something the parties argued in their filings. One possibility for what might be “special circumstances” would be a product that has been recalled, refurbished, reconditioned or returned. In other words, some sort of “special circumstance” outside the ordinary course of sales suggesting individualized knowledge and appreciation of a specific risk of harm.
The Indiana Supreme Court’s reasoning in Rushford is instructive:
Thus, we conclude that having provided Rushford with the manufacturer’s warning, [the dealership] was under no duty to give Rushford additional warnings, including advising Rushford to read the manufacturer’s warnings based on [the dealership’s] knowledge of “Rushford’s peculiar characteristic.” Rushford, 845 N.E.2d at 203. To conclude otherwise would place retail sellers like [the dealership] in the position of attempting to determine which particular manufacturer warnings may be of unique importance to an individual consumer and then direct the consumer’s attention to those warnings. In our view this is an untenable position and an unnecessary burden.
Ford Motor Co. v. Rushford, 868 N.E.2d 806, 811-12 (Ind. 2007) (emphasis added). It would appear that if requiring a seller to determine which warnings are most important for a given buyer is “an untenable position and an unnecessary burden,” then requiring a seller to create its own warnings and instructions to supplement those of the manufacturer far exceeds the duties imposed on sellers by the IPLA.
In Crawfordsville Town & Country Home Ctr., Inc. v. Cordova, 119 N.E.3d 119, 130 (Ind. Ct. App.), reh’g denied (Mar. 26, 2019), transfer denied, 129 N.E.3d 778 (Ind. 2019), the Indiana Court of Appeals reversed denial of a summary judgment. It found no duty as a matter of law on the part of a lessor of an aerial lift to provide additional warnings or instructions for safe use to the plaintiff lessee of the lift who was injured after he operated the lift in close proximity to a high voltage electrical line. The court found no genuine issue of material fact even though a representative of the lessor came to the jobsite and observed the aerial lift near high-voltage electrical lines in contravention of the warnings. The court reasoned that warnings with respect to the use of the aerial lift near high-voltage electrical lines were given by the manufacturer and were clearly visible on the lift. Cordova argued that the warnings were inadequate because he spoke limited English, and none of the warnings on the equipment or in the owner’s manual were in Spanish.
Recall earlier that the Indiana Supreme Court in Rushford required the presence of special circumstances before a nonmanufacturing seller has a duty to provide additional or different warnings. The court in Cordova found no special circumstances triggering an independent duty to warn or provide instructions in spite of the lessor of the aerial lift coming to the jobsite and seeing it positioned near the high voltage electrical line. Given that decision, it would be hard to imagine a set of facts that would require an independent duty to provide warnings and instructions for safe use.
In conclusion, Rushford and Cordova stand firmly for the proposition that a nonmanufacturing seller or distributor of a product, absent very special circumstances, is under no duty — before or after sale — to provide different or additional warnings from those provided by the original manufacturer.•
■ Adam Ira is senior associate in the Indianapolis office of Frost Brown Todd and a member of DTCI. The opinions expressed in this article are those of the author.