Opinion
Cause No. IP00-0220-C-H/G
March 8, 2001
ENTRY ON DEFENDANTS' MOTION FOR SUMMARY JUDGMENT
Plaintiff Charles Land was injured by an explosion of the Yamaha WaveRunner he was trying to start. The explosion occurred on June 25, 1998. Mr. Land and his wife April filed suit in the Hendricks Circuit Court, alleging that defendants Yamaha Motor Corporation, U.S.A., and Yamaha Motor Company, Ltd., are liable for their injuries based on negligence and strict liability for defective products. Defendants removed the case to this court.
The WaveRunner involved in this case was first sold or delivered to a consumer on July 28, 1987, more than ten years before the explosion that injured Mr. Land. Defendants have moved for summary judgment. They rely on the statute of repose in Indiana's product liability statute, which is currently codified as Ind. Code § 34-20-3-1(b)(2). (The statute was previously codified as Ind. Code § 33-1-1.5-5.) The statute of repose provides that product liability actions must be commenced within ten years after the delivery of the product to the initial user or consumer. In response, plaintiffs contend that California law rather than Indiana law should apply. If Indiana law applies, plaintiffs contend in the alternative that defendants violated a post-sale duty to warn within the actionable time period and that application of the statute of repose to this case would violate plaintiffs' rights under the Indiana Constitution. As explained below, none of these arguments is persuasive. Defendants are entitled to summary judgment based on the Indiana statute of repose.
The statute provides an exception where the cause of action accrues between eight and ten years after the initial delivery. In such cases, the action must be commenced within two years after it accrues.
Undisputed Facts
The following facts are undisputed for purposes of defendants' motion for summary judgment. On July 28, 1987, Indiana resident Wallace Richardson purchased and took delivery of the 1988 Yamaha WaveRunner Model WR500G, hull identification number YAM026767D788 ("the WaveRunner"), which later exploded in 1998 and injured Mr. Land. Richardson purchased the WaveRunner from Burnett Brothers Boat Mart in Louisville, Kentucky. During August and September 1987, Richardson used the WaveRunner. He later sold the WaveRunner to Don Murphy.
The WaveRunner was manufactured in Japan by defendant Yamaha Motor Co., Ltd., and was imported into the United States by defendant Yamaha Motor Corporation, U.S.A., which also participated in developing the WaveRunner. Yamaha Motor Corporation, U.S.A., sold the WaveRunner to Burnett Brothers Boat Mart on July 7, 1987, by shipping it to Louisville, Kentucky. Yamaha Motor Corporation, U.S.A., maintains its office and principal place of business in California. More Yamaha WaveRunners have been sold in California than in Indiana. The WaveRunner in this case was never used in California for recreational purposes. There is no evidence it was ever in California.
In 1989 or 1990, Indiana resident Larry Bush purchased the WaveRunner and used it primarily in Indiana. Bush was the registered owner of the WaveRunner at the time of the accident in this case. The WaveRunner was registered with the Indiana Department of Natural Resources. Bush garaged and serviced the WaveRunner in Indiana from 1989 or 1990 until the accident.
On June 25, 1998, plaintiff Charles Land boarded the WaveRunner on Heritage Lake in Hendricks County, Indiana. As he attempted to start the WaveRunner, it exploded suddenly and without warning. The WaveRunner was in substantially the same condition on June 25, 1998, as it was when it left the possession of defendants.
Plaintiffs Charles and April Land filed suit on December 23, 1999. Both the explosion itself and the filing of the suit occurred more than ten years after the WaveRunner was delivered to the first user or consumer, Wallace Richardson.
Relevant to plaintiffs' argument that defendants violated a post-sale duty to warn, plaintiffs have identified a number of additional facts that the court treats as undisputed for purposes of the pending motion, at least to the extent that the evidence (not merely the allegations in the complaint) supports those assertions when the evidence is viewed in the light reasonably most favorable to the plaintiffs. In 1988, Yamaha Motor Corporation, U.S.A., issued a recall of 27,662 of the WaveRunner and Wavejammer models to make modifications to reduce the possibility of leakage in the fuel system. In 1991, Yamaha Motor Corporation, U.S.A., issued a recall of 5,677 WaveRunners to make modifications to reduce the possibility of leakage in the fuel system.
For purposes of the motion for summary judgment, the court assumes that, at the time the WaveRunner left the possession and control of the defendants, it was in a defective condition unreasonably dangerous to anticipated users. The court makes that assumption because defendants' motion for summary judgment, which was limited to the issue of the statute of repose, essentially assumed that plaintiffs could prove their claims on the merits. Plaintiffs have asserted some additional facts supported only by allegations in their complaint. The court does not assume those facts are true for purposes of the motion, although none of them would be material in any event.
Discussion I. Choice of Law
In a case within federal diversity jurisdiction, a federal district court applies the choice of law rules of the forum state. Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 496-97 (1941); Jean v. Dugan, 20 F.3d 255, 260-61 (7th Cir. 1994).
Under Indiana choice of law principles for tort cases, the law of the location where the injury occurs generally controls. Hubbard Manufacturing Co. v. Greeson, 515 N.E.2d 1071, 1073 (Ind. 1987). Before Hubbard Manufacturing, Indiana had long followed the rule that the law of the place where the last act completing the wrong occurred (lex loci delicti commissi) always governed, which was usually the place of the injury. In Hubbard Manufacturing, however, Indiana modified that rule to recognize exceptions where the place of the injury was insignificant for the lawsuit. In that case, an Indiana resident was killed in Illinois while operating allegedly defective equipment that had been manufactured in Indiana. Also, the decedent and the defendant had had a prior business relationship centered in Indiana. See 515 N.E.2d at 1073-74.
The Indiana court reasoned that the location of the death was insignificant for that lawsuit, so the court evaluated factors identified in the Restatement (Second) of Conflicts of Laws § 145(2) (1971). The Indiana court held that Indiana law governed the product liability lawsuit for the death that had occurred in Illinois. 515 N.E.2d at 1073-74; see also Judge v. Pilot Oil Corp., 205 F.3d 335, 337 (7th Cir. 2000) (applying Hubbard Manufacturing and holding that Indiana law governed claims against employer of security guard who wrongfully shot and killed Utah resident at a truckstop in Indiana).
In this case, the location of the accident bears a significant relationship to this lawsuit. Indiana was the location of the accident, the residence of plaintiffs, the place where they suffered from their injuries, and the location where the WaveRunner had been operated, garaged, serviced, and registered for many years. The Lands argue that the location of the accident was "insignificant," but they have cited no Indiana cases treating the location of the accident and injury as insignificant under remotely comparable circumstances.
As the Seventh Circuit noted in Judge v. Pilot Oil, Hubbard Manufacturing "slightly modified" the old rule, and that modification applies only in those relatively uncommon cases where the place of the injury bears no significant relationship to the lawsuit. 205 F.3d at 336-37. Indiana law applies to the Lands' claims in this case.
II. Plaintiffs' Theory of a Post-Sale Duty to Warn
Plaintiffs also argue that defendants breached duties to warn users of dangerous defects in the WaveRunner. Plaintiffs contend that such breaches occurred long after the original sale of the WaveRunner, such that their action is timely to the extent it is based on the alleged failure to warn. The Supreme Court of Indiana and the Seventh Circuit have rejected this theory as a means for avoiding the ten-year time limit in the Indiana statute of repose. See Avery v. Mapco Gas Products, Inc., 18 F.3d 448, 454-55 (7th Cir. 1994) (applying Indiana law and affirming summary judgment for manufacturer); Dague v. Piper Aircraft Corp., 418 N.E.2d 207, 212 (Ind. 1981) (rejecting plaintiff's effort to carve out exception to statute of repose for claims based on defendant's failure to warn of the latent dangers in its product). Plaintiffs have cited a law review article criticizing Dague, and they argue that the Seventh Circuit misinterpreted Dague in Mapco Gas Products. Such arguments should be addressed to those courts. Those two decisions require this district court to reject plaintiffs' theory that an alleged breach of a post-sale duty to warn or recall avoids application of the statute of repose.
Plaintiffs correctly point out that the Indiana Court of Appeals has recognized some claims of post-sale negligence that are not controlled by the statute of repose and its limitations period that begins to run with the initial sale or delivery of the product. For example, in Stump v. Indiana Equipment Co., 601 N.E.2d 398 (Ind.App. 1992), the Court of Appeals reversed summary judgment against a person who had been severely injured in an accident involving a 20-year old grader. In Stump, however, the defect in the grader was not present in the grader when it was originally manufactured and sold. After the original manufacture and sale, someone had wired the starter switch so as to bypass a safety switch. Id. at 400. The Court of Appeals found that the statute of repose did not apply to a claim based on such separate acts of post-sale negligence in maintaining, inspecting, and/or handling the product in question. Id. at 402.
That conclusion in Stump is obviously correct, but it does not help plaintiffs in this case. The undisputed facts in this case show that when the WaveRunner exploded in 1998, it was in substantially the same condition as when it had left defendants' possession. Cplt. ¶ 18. Stump does not offer a path for avoiding the controlling decisions of Dague and Mapco Gas Products, which require the court to reject plaintiffs' claim of breach of a post-sale duty to warn of an existing defect.
III. Indiana Constitutional Challenge
Plaintiffs also contend that application of the statute of repose to their claims violates the Indiana Constitution. Plaintiffs rely on Article I, section 23, which provides: "The General Assembly shall not grant to any citizen, or class of citizens, privileges or immunities, which, upon the same terms, shall not equally belong to all citizens," and Article I, section 12, which provides in relevant part for "remedy by due course of law" for injuries to "person, property, or reputation." Plaintiffs rely heavily on the reasoning of Martin v. Richey, 711 N.E.2d 1273 (Ind. 1999), in which the Supreme Court of Indiana held that the two-year limitation on actions for medical malpractice violated these same provisions of the Indiana Constitution as applied to a claim of negligence that was not discovered and could not have been discovered within the two-year period.
When plaintiffs filed this action, the Supreme Court of Indiana was considering a challenge to the constitutionality of the product liability statute of repose as applied to a case where the injury occurred more than ten years after the initial delivery, so that the statute effectively foreclosed any action. On May 26, 2000, however, the Supreme Court of Indiana distinguished Martin v. Richey and upheld the constitutionality of the product liability statute of repose. McIntosh v. Melroe Co., 729 N.E.2d 972 (Ind. 2000). Plaintiffs have not offered any basis for distinguishing McIntosh v. Melroe Co., and that decision requires this court to reject the Lands' challenges under the Indiana Constitution. Accordingly, the statute of repose bars the plaintiffs' claims against the defendants. Defendants' motion for summary judgment is hereby granted. The court will enter final judgment in favor of defendants.
So ordered.