Deck 4: Judicial, Alternative, and E-Dispute Resolution

Question 1

Summary Judgment Deborah Daughetee con­sumed multiple bags of microwave popcorn daily for approximately 5 years. Deborah recalled eating more than 10 different brands of buttered popcorn. After removing a bag of butter-flavored microwave popcorn from the microwave, Deborah would open the bag and draw the buttery smell into her nose and lungs. She testified that she "liked the smell of opening a bag near my face." Diacetyl is a food chemical that is an ingre­dient used to produce the "buttery" taste and smell of buttered microwave popcorn. Chr. Hansen, Inc., Symrise, Inc., and Firmenich, Inc. (defendants) are corporations that produce butter flavoring that con­tains diacetyl. Defendants sold their butter flavoring to microwave popcorn manufacturers who produced the various brands of buttered popcorn eaten by Debo­rah. On opening a microwave popcorn bag with but­ter flavoring, diacetyl vapors are released. After several industry studies found that extended exposure to di-acetyl vapors could cause lung disease, many popcorn manufacturers adopted a number of safety precautions in their microwave popcorn plants to protect workers from overexposure to butter flavoring vapors. However, the popcorn makers made no changes to their prod­ucts' packaging. Deborah sued the defendants, claim­ing that she had developed respiratory injury-known as popcorn lung-by smelling the microwave popcorn that contained the buttered flavoring made by the de­fendants. The defendant corporations made motions for summary judgment. Should the defendants' motions for summary judgment be granted? Daughetee v. Chr. Hansen, Inc., 2013 U.S. Dist. Lexis 50804 (2013) (United States District Court for the Northern District of Iowa, 2013)

Answer 1

Case summary:
Person D bought and consumed many bags of microwave popcorn about 5 years. He recalled eating more than ten varieties of buttered popcorn. She always likes to smell the bag while opening. The popcorn contains "Diacetyl" food chemical, which adds the buttery smell and taste. Several industrial studies found that the "Diacetyl" chemical leads to lung disease. The popcorn manufacturers took required steps to protect their workers and did not make any changes in the product packages.
Person D sued the defendants claiming that the popcorn flavor causes lungs disease. The defendant made motion for summary judgment.
Determine whether the summary judgment should be granted:
The defendants' motion for summary judgment should not be granted because the trial court noticed that the flavors used in popcorn causes lung diseases. It is concluded that the defendants' product was dangerous as it caused lung disease to individuals who smell it frequently. Person D used different brands of popcorn manufactured by three companies.
Here, it is difficult to determine the degree of liability of each manufacturer. Further, the manufacturers failed to warn the user about the potential risk of smell the flavors.
Conclusion:
The motion for summary judgment is applicable when there is no factual reason for the damages. However, in this case, the cause for the lung disease is "Diacetyl" food chemical that was used for flavoring. Hence, defendants' motion for summary judgment should not be granted.

Question 2

Service of Process Jon Summervold purchased a remote-controlled toy watercraft from the Walmart store located in Aberdeen, South Dakota. The plaintiff sued Wal-Mart, Inc. for alleged defective design and failure to warn that arose out of the trauma he suffered when the toy watercraft exploded when he was handling it. Nine days before the three-year statute of limitations was to run on the plaintiff's claim, the plaintiff had a pro­cess server serve his complaint and summons against Walmart. The process server served the complaint and summons on Josh Hehn, a Walmart assistant manager in charge of the apparel department at Walmart's Aber­deen, South Dakota, store. The assistant manager and the manager of the store were physically available at the store at the time of service. South Dakota law requires that service of process be made on the president, officer, director, or registered agent of a defendant corporation. Walmart had designated a registered agent, whose name was publicly available at a state government office as required by law, to accept service of process for South Dakota lawsuits. Walmart challenged the plaintiff's ser­vice of process on an assistant manager at a Walmart store, rather than on its resident agent, asserting that the plaintiff's service violated South Dakota's statute for service of process against corporations. The three-year statute of limitations on Summervold's claim had run before Walmart's challenge to the legality of the service of process was heard by the court. Has plaintiff prop­erly served defendant Walmart? Sommervold v. Wal-Mart, Inc., 709 F.3d 1234, 2013 U.S. App. Lexis 4972 (United States Court of Appeals for the Eighth Circuit, 2013)

Answer 2

Case summary:
Person JS bought remote control watercraft toy in WM store located in state SD. He found that it was defective in design and they failed to warn the user for the chance of explosion. Person JS sued WM store for alleged the toy exploded and failure design.
After summon sent to WM store, the "service of process" attended by the assistant manager of the store. Based on the state law, the service of process should be made on the registered agent, officer, director, or the president.
Determine whether the plaintiff properly served the defendant WM store:
The plaintiff Person JS was not served properly by the defendant WM store. According to SD state law, "service of process" on a corporate defendant must be made either by the officer, president, director, or registered agent of the corporation. However, in this case the plaintiff served as an assistant manager (non-officer staff) of the WM store. Therefore, it is concluded that the plaintiff did not serve the defendant properly.
Court held that the service of process is invalid because plaintiff had failed to comply state SD's applicable service of state. Further, the 3 years statute of limitation had run out on claim of the plaintiff. Therefore, the lawsuit against the WM store has been dismissed.
Conclusion:
Even though the plaintiff did not properly serve defendant WM store, the claim of the defendant is running out of the case. Therefore, the judge dismisses the case of plaintiff against WM store.

Question 3

Summary Judgment Sandra Primrose, who was 73 years old, was shopping in a Walmart store owned and operated by Wal-Mart Stores, Inc. (Walmart). She picked up a watermelon from a large display stand and as she took several steps around the display to reach her shopping cart, she tripped over a corner of the dis­play. Primrose sustained a concussion and other seri­ous injuries as a result of the accident. Primrose sued Walmart for negligence to recover damages, alleging that Walmart "created a trap" for her. Evidence showed that the watermelon display had been used for more than four years without incident, and photographs showed that the four corners of the display were visibly marked with "Watch Step" warning signs. Walmart noted that the area in question was open and obvious. Walmart, alleging that no material facts were in dispute, made a motion for summary judgment, which plaintiff Prim­rose objected to. Should Walmart be granted sum­mary judgment? Primrose v. Wal-Mart Stores, Inc. , 127 So.3d 13, 2013 La. App. Lexis 1985 (Court of Appeals of Louisiana, 2013)

Answer 3

Case summary:
Person P is 73 years old women who entered WM store for shopping. She took watermelon from large display stand. While taking it, she tripped over the corner of the display. As a result of the accident, she was concussion and got other injuries. Person P sued WM store alleging that the store creates a trap for her.
The evidence shows that the stand has been used for more than four years without any problem and the store displayed warning signs of "watch step". WM store made a motion for summary judgment.
Determine whether WM store granted motion for summary judgment:
WM store should be granted motion for summary judgment. It can be granted when there is no material fact of the case to dispute. In this case, the court of appeals decided that there is no material fact and issued summary judgment. Here, court rejects the plaintiff's claim that WM store created trap for person P. It is because the action of person P caused the accident and it was not due to the negligence of WM store.
Conclusion:
The WM store has displayed "watch step" warning message in the four corners of the store. Further, the store did not instruct Person P to take the watermelon and move several steps around the display with it. It is considered as unfortunate accident and it granted summary judgment to WM store.

Question 4

Class Certification Zurn Pex, Inc. and Zurn In­dustries, Inc. (Zurn) manufactures and markets a home plumbing system that uses Pex tubing, an alternative to traditional copper water pipes. Pex tubing systems are marketed as easier to install, cheaper, and longer lasting than copper plumbing systems. The Zurn Pex systems have been installed in homes throughout the United States. Zurn has sold its Pex systems with a 25-year limited warranty. Pex tubes are joined together using a brass fitting and crimp. Many homeowners have al­leged that the brass fittings used in these systems have leaked because of their susceptibility to corrosion. The corrosion increases over time and has caused costly water damage to homes. Zurn argues that corrosion is not an inherent defect in its product but that it is in­stead caused by a variety of factors, including improper installation and overly corrosive water. Homeowners in Minnesota who have installed Zurn's Pex systems, in­cluding those who have had leaks and those who have not yet experienced such leaks, seek to bring a class action against Zurn to enforce its warranties and to have the Pex systems repaired or replaced according to the warranty. The class is defined as "All persons and entities that own a structure located within the State of Minnesota that contains a Zurn Pex plumbing system with Zurn brass crimp fittings." Zurn argues that the class should not be certified. Should the class be certified? In re Zurn Pex Plumbing Products Liability Litigation, 644 F.3d 604, 2011 U.S. App. Lexis 13663 (United States Court of Appeals for the Eighth Circuit, 2011)

Question 5

Summary Judgment Bad Boy Enterprises LLC (BBE) designs and manufactures the Bad Boy Classic vehicle, an electric 4-wheel-drive vehicle that is built on a golf cart chassis. The buggy is designed primarily for off-road use and is marketed mostly to hunters and outdoor enthusiasts. Mark Silver purchased a Bad Boy Classic vehicle. Mr. Silver taught his daughter, Elle, who was 13 years old, how to drive the vehicle and gave her permission to drive it. Elle drove the vehicle with Elle's friend Brittany Peacock and Elle's little sister as passen­gers. When Elle was driving the vehicle around a loop­ing gravel driveway, she noticed that the vehicle would, at times, go fast as if she had pressed harder on the accelerator, even though she was keeping steady pres­sure on the accelerator. Brittany, who had also driven the vehicle that day, also stated that the vehicle had an unintended acceleration problem. Elle, while driv­ing the vehicle, felt the vehicle surge as she approached a curve. Elle took her foot off the gas and applied the brake, and the vehicle slowed down a little. The vehi­cle started tilting, tipped over, and came to rest on the driver's side. The vehicle was traveling between 10 and 13 miles per hour when the accident happened. As a result of the accident, Elle's left foot and part of her left leg were severed. In the past, BBE had recalled several types of its vehicles to repair them for unintended ac­celeration problems. Elle's parents brought a product liability action against BBE, alleging that the buggy was defectively designed because it would accelerate with­out any input from the driver, that it had a propensity to roll over, and that it was not crashworthy. At trial, Elle planned on calling Brittany, her sister and parents, and employees of BBE as witnesses as well as calling expert witnesses. BBE filed a motion for summary judgment, alleging that there were no facts to be decided by a jury and that the court could decide the case on a summary judgment motion. Elle opposed the motion, asserting that there were sufficient facts for the jury to decide at trial that would prevent the granting of a summary judgment. Must the court grant defendant BBE's motion for summary judgment? Silver v. Bad Boy Enterprises, 2013 U.S. Dist. Lexis 117562 (United States District Court for the Middle District of Georgia, 2013)

Question 6

Summary Judgment Plaintiff Phyllis Toote filed a lawsuit against Pathmark Stores, Inc., a grocery store, and Canada Dry Bottling Company of New York, a bottler and distributor of soda. In her complaint, the plaintiff alleged that the defendants were liable for negligence for injuries she suffered when she fell over cases of soda that were stacked on the floor of the supermarket when she was shopping at the supermarket.
Defendant Pathmark took plaintiff Toote's deposition, in which she stated that she had entered the supermarket, and upon entering the store, she immediately walked to the soda aisle. Toote stated that she did not see the soda stacked on the floor before she fell over the soda. In the deposition, Toote stated that she did not know how long the soda had been on the floor before she tripped and fell. Pathmark made a motion for summary judgment, alleging that plaintiff Toote could not establish how long the soda had been on the floor before she fell. The Motion Court denied Pathmark's motion for summary judgment, finding that there were questions of fact to be decided by the jury. Pathmark appealed. Should the court grant Pathmark's motion for summary judgment? Toote v. Canada Dry Bottling Company of New York, Inc. and Pathmark Stores, Inc., 7 A.D.3d 251, 776 N.Y.S.2d 42, Web 2004 N.Y. App.Div. Lexis 6470 (Supreme Court of New York, Appellate Division)

Question 7

Ethics Case BMW North America, LLC, and Rolls-Royce Motor Cars NA, LLC, distribute luxury automobiles, automobile parts, and lifestyle items in the United States. These companies and their parent and affiliate companies own various trademarks bearing the "BMW" and "Roll-Royce" trademarks. These companies (plaintiffs) discovered that counterfeit products bearing their trademarks were being advertised and sold from certain websites. After further investigation, it was determined that DinoDi-rect Corporation, a Delaware corporation; DinoDirect China Ltd., a Hong Kong limited liability company; and B2CForce International Corporation, a California corporation (corporate defendants) were involved with the production and distribution of these counterfeit items in the United States. Kevin Feng is the president or founder of these corporations. The plaintiffs sued the corporate defendants and Feng in U.S. district court in California for trademark infringement. The defendants were served the complaint and summons in the case. The defendants sent various e-mails to the court but never appeared in court or filed an answer to the complaint. The court gave the defendants several op-portunities to do so, but no answers were ever filed. The court granted the plaintiffs a default judgment against the defendants. BMW of North America v. Di-nodirect Corporation , 2012 U.S. Dist. Lexis 170667 (United States District Court for the Northern Districtof California, 2012)
1. When is a default judgment issued? 2. Is the issuance of a default judgment against the defendants warranted in this case? 3. Did the defendants act ethically in this case?

Question 8

Ethics Case Johnson Controls, Inc., is a Wisconsin company that manufactures building equipment and management systems, and distributes its products worldwide through direct sales, contractors, and distributors. Edman Controls, Inc. is a distribution company incorporated in the British Virgin Islands. Johnson and Edman entered into an agreement that awarded Edman the exclusive rights to distribute Johnson products in the country of Panama. The agreement provided that any dispute arising from the parties' arrangement would be resolved through arbitration using Wisconsin law and that the losing party would have to pay the prevailing party's attorney's fees and costs. Under this arrangement, Edman developed relationships with builders in Panama and distributed Johnson's products to these builders. Three years later, Edman discovered that Johnson was circumventing Edman by selling its products directly to Panamanian developers, including some that had previously purchased Johnson's products from Edman.Edman initiated arbitration proceedings against Johnson for breach of contract. The arbitrator found that Johnson had breached its agreement with Edman and awarded Edman $733,341 in lost profits and damages, $252,127 in attorney's fees, $39,958 in costs, and $23,042 in prejudgment interest. Johnson did not accept this result and filed a motion with the U.S. district court, asking the court to vacate the arbitrator's award. The court refused to do so and confirmed the arbitrator's award. Still not satisfied, Johnson appealed the case to the U.S. court of appeals, asking the court to vacate the arbitrator's award. Johnson Controls, Inc. v. Edman Controls, Inc. , 712 F.3d 1021, 2013 U.S. App. Lexis 5583 (United States Court of Appeals for the Seventh Circuit, 2013)
1. What is an arbitrator's award? 2. Should the U.S. court of appeals vacate the arbitrator's award? 3. Did Johnson Controls act ethically in this case?