Component Part Manufacturer Liability in Oregon

Oregon Did Not Adopt Caveat (3) In Its Adoption of The Restatement (Second) of Torts, § 402A (1965)

Component part liability is important in products liability cases and especially in aviation cases, where the aircraft may have a long air-frame life but require service or replacements of hundreds of parts over its years of service.  Although Oregon adopted the Restatement (Second) of Torts, § 402A contains a caveat (Caveat 3 (1965)) regarding whether strict liability should be extended to component part manufacturers.  The Oregon Legislature, however, did not adopt this caveat as an interpretive guide for the courts.  Therefore, both pre-codification and post-codification Oregon Supreme Court rulings hold that strict liability can extend to component part manufacturers for the sale of defective components.  See State ex rel Hydraulic Servocontrols v. Dale, 294 Or 381 (1982); Smith v. J.C. Penney Co., 269 Or 643 (1974) (fabric manufacturer held liable because of flammable character of fabric, even though fabric was sold to the coat manufacturer before reaching consumer).  If the component part is dangerously defective and it causes injury, the component part manufacturer (or seller or distributor) is subject to liability.

Oregon law also follows the Restatement (Third) of Torts: Products Liability, which takes the position that if the component part is defective and causes injury, the component part manufacturer (or seller or distributor) is subject to liability.  Additionally, if the component part manufacturer “substantially participates in the integration of the component into the design of the product,” the component manufacturer is subject to liability. Restatement (Third) Of Torts: Products Liability § 5 (1998).

Oregon Law Involving Alleged Misapplication of a Raw Material:  Misapplication of a Raw Material Does Not Give Rise To Liability As To the Supplier

The manufacturer of a component part, however, is not subject to strict liability if the component was misapplied rather than defectively designed.  In Hoyt v. Vitek, Inc., 134 Or App 271 (1995), after experiencing problems with her temporomandibular joint (TMJ), the joint that connects the jaw bone to the skull, the plaintiff, Hoyt, had a prosthetic device implanted in her jaw.  The device gradually fragmented and released particles of Teflon, which caused a serious adverse reaction.  Du Pont Company manufactured Teflon and sold it to Vitek, Inc., which used the Teflon as a component part in its TMJ device.

Vitek designed, manufactured and marketed the device.  In 1977 DuPont informed Vitek that it manufactured Teflon for industrial purposes only and had sought no FDA rulings on the safety or effectiveness of surgical uses, and that Vitek would have to rely on its own medical and legal judgment.  Du Pont was aware of studies that warned of abrasion and fragmentation with medical Teflon implants and passed along this information to Vitek.  In 1983, Vitek received permission from the FDA to market the device pending “specific performance standards.”  Hoyt, supra, 134 Or App at 277.

Hoyt sued Du Pont, contending that Teflon was unreasonably dangerous because it was defectively designed and because of Du Pont’s failure to warn the medical community.  The court of appeals found that the component part was not defective.  The court of appeals also relied on the “raw material supplier” doctrine in deciding not to apply strict liability.  When a multiuse raw material is not unreasonably dangerous in itself, but becomes unreasonably dangerous when incorporated into certain uses, the supplier cannot be sued based on strict liability.  Hoyt, supra, 134 Or App at 284-286.  See Crossfield v. Quality Control Equip. Co., 1 F3d 701 (8th Cir 1993); Childress v. Gresen Mfg. Co., 888 F2d 45 (6th Cir 1989).

Cases in Which Component Parts Are the Allegedly Defective Product

Plaintiffs did allege that defective replacement parts were supplied after the first sale of a helicopter in Evans v. Bell Helicopter Textron, 1998 WL 1297138 (D Or 1998), but the service bulletins proffered by plaintiffs were insufficient to establish that the defective component parts were installed in the engine after the first sale.  The helicopter was manufactured in 1979, and crashed seventeen years later.  Defendants’ motion for summary judgment was granted on the basis of ORS 30.905 because plaintiffs could not support their allegation that an affirmative misrepresentation occurred after the first sale of the helicopter by defendants.

In Allstate Indem. Co. v. Go Appliances LLC, 2006 WL 2045860 (D Or 2006), plaintiff alleged that a defective compressor installed on a used refrigerator caused a fire in its subrogor’s house.  The opinion does not state when the refrigerator was originally first sold and does not discuss product liability time limitations.  However, the court held that plaintiff could assert a products liability action against the defendant, who sold the used appliance and installed the allegedly defective new compressor.

The statute of ultimate repose in both strict product liability cases and negligence cases is beyond the scope of this article.  However, one of the controlling Oregon cases relevant to a replacement component part is Erickson Air-Crane Co. v. United Technologies Corp., 303 Or 281 (1987), mod. on recons. 303 Or 452.  Although Erickson discussed the application of the products liability statute of ultimate repose in the context of post-sale negligent misrepresentation, the case is relevant to a discussion regarding application of the statute of ultimate repose to a post- sale installation of a defective component part.

In Erickson, plaintiff purchased a helicopter in 1971.  Defendant allegedly made misrepresentations regarding the useful safe life of a compressor disc in 1977.  After the helicopter crashed in 1981 due to exhaustion of the compressor disc, plaintiff filed suit in 1983.  The plaintiff’s complaint alleged that defendant was negligent in providing erroneous information, failing to warn plaintiff as to the erroneous information, and failing to warn that the helicopter was dangerous after expiration of the true safe life of the compressor disc.  Erickson, 303 Or at 284-85.

The Oregon Court of Appeals found that plaintiff’s action against the manufacturer was a product liability action, and that because the action was commenced more than eight years after the first purchase of the helicopter, the statute of ultimate repose barred the action.  Id. at 285-86.  The Supreme Court reversed, holding that:  “ORS 30.905 applies only to acts, omissions or conditions existing or occurring before or at the ‘date on which the product was first purchased for use or consumption.’  Acts or omissions occurring after that date are governed by the statute of ultimate repose contained in ORS 12.115.”[1]  Id. at 286.  Because the defendant relayed the false information about the useful safe life of the compressor after the helicopter was first purchased, ORS 30.905 did not apply.  Id. at 289. (“The difference between the present case and the type of case that the legislature meant to cover under ORS 30.905(1) is that, in this negligence case, the reasonableness of certain of defendant’s actions after plaintiff’s purchase are in question while, in a product liability case governed by ORS 30.905, it is the condition of the article at the date of purchase that is in question.”) (emphasis in original).

The Erickson holding, when viewed in the context of installations of new components, supports the argument that such alterations cannot “restart” the statute of ultimate repose on the original product.  Erickson holds that ORS 30.905 only applies to “acts, omissions or conditions existing or occurring before or at the ‘date on which the product was first purchased for use or consumption,’” and a post-sale negligent misrepresentation leading to the installation of a new product necessarily occurs after the date the product was first purchased.  A manufacturer can argue that under Erickson, the statute of ultimate repose should run on the original product from the date it entered the stream of commerce, regardless of whether component parts were installed post sale.

 

 


[1] ORS 12.115 is the generic statute of ultimate repose for negligence actions, and provides that “any action for negligent injury to person or property of another” must be commenced within “10 years from the date of the act or omission complained of.”

Effective Cross-Examination of Plaintiff’s Psychological Expert Can Reduce or Eliminate Damages for Misdiagnosed Claims of PTSD

Jurors in the jury box

Post-Traumatic Stress Disorder (“PTSD”) is a mental disorder within the trauma and stressor-related disorders included in The American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders, or DSM-5.  It was previously categorized in the anxiety classification of disorders in the “DSM-IV”.

Personal injury, product liability, and aviation defense lawyers should be well prepared to cross-examine forensic psychologists who testify on behalf of plaintiffs that they suffer from PTSD.  Reasons for thorough preparation include the frequent lack of critical information regarding a plaintiff’s background, inadequate psychological testing, improper reading of validity scales, or an absence of reliance on any other data or criteria by the forensic psychologist testifying on behalf of plaintiff.  If defense counsel is thoroughly familiar with the DSM-5 (and its criteria and commentary on PTSD) and is prepared for an effective cross-examination of plaintiff’s treating or forensic psychologist, damages for emotional distress in PTSD claims can be significantly reduced or eliminated.

Olson Brooksby primarily defends product liability, higher exposure personal injury, and aviation cases.  Over the past few years, we have seen a trend developing whereby almost every plaintiff filing a personal injury lawsuit in such cases claims they suffer from PTSD as a consequence of the alleged injury, without regard for any other potential causes or their own overall life experience.  As a result, most plaintiffs seek emotional distress damages for PTSD as an element of damages in their personal injury lawsuits.

This being the case, there is no substitute for thorough preparation, in-depth knowledge of the material, and the ability to translate “psycho-speak” into plain language in order to mount an effective cross examination.  This preparation should start with a rigorous study of the DSM-5.

Effectively Challenging Plaintiff’s Allegation of PTSD Can Significantly Reduce or Eliminate Plaintiff’s Claim For Emotional Distress Damages

Most plaintiff and defense attorneys would likely admit that handling PTSD claims on behalf of their respective clients, and in particular, dealing effectively with forensic psychological experts, is difficult.  In defending a personal injury action where PTSD is claimed, it is essential that defense counsel have a thorough understanding of the interaction between the DSM-5, standardized testing, how the testing was scored, whether the tests administered had validity scales, and what other personal historical factors and information the plaintiff’s examining physician had available to him or her.

It is also important to determine whether the plaintiff’s experts considered any other mental disease or defect, and, if so, how they reached their differential diagnosis of PTSD.  All of this is necessary for thoroughly cross-examining plaintiff’s experts and challenging misdiagnosed claims of PTSD.

There is no single test that will clinically establish the presence of PTSD.  Typically, tests such as the MMPI, the TSI, or other standardized tests are administered.  Defense counsel should know whether there are validity scales and what they show, and they should be prepared to cross-examine plaintiff’s expert on these issues.  Defense counsel should cross-examine plaintiff’s expert on his or her knowledge of recent longitudinal studies done on PTSD, many of which are authored or co-authored by members of the DSM-IV or DSM-IV-TR PTSD Work Group or other Task Force or advisors.

Other fertile strategies for cross-examination include probing the extent of the expert’s clinical experience, how they applied clinical judgment to reach the diagnosis, how they accounted for malingering, and extensive questioning regarding key diagnostic criteria such as “life-threatening” and “persistence.”

Essential Diagnostic Features of Post-Traumatic Stress Disorder (“PTSD”) 

“The essential feature of post-traumatic stress disorder (PTSD) is the development of characteristic symptoms following exposure to one or more traumatic events.  Emotional reactions to the traumatic event (e.g., fear, helplessness, horror) are no longer a part of Criterion A.  The clinical presentation of PTSD varies.  In some individuals, fear-based re-experiencing, emotional, and behavioral symptoms may predominate.  In others, anhedonic or dysphoric mood states and negative cognitions may be most distressing.  In other individuals, arousal and reactive-externalizing symptoms are prominent, while in others, dissociative symptoms predominate.  Finally, some individuals exhibit combinations of these symptom patterns.”  DSM-5 at p. 274.

The directly experienced traumatic events in Criterion A include, but are not limited to, exposure to war as a combatant or civilian, threatened or actual physical assault (e.g., physical attack, robbery, mugging, childhood physical abuse), threatened or actual sexual violence (e.g., forced sexual penetration, alcohol/drug-facilitated sexual penetration, abusive sexual contact, noncontact sexual abuse, sexual trafficking), being kidnapped, taken hostage, terrorist attack, torture, incarceration as a prisoner of war, natural or human-made disasters, and severe motor vehicle accidents.

For children, sexually violent events may include developmentally inappropriate sexual experiences without violence or injury.  A life-threatening illness or debilitating medical condition is not necessarily considered a traumatic event.  Medical incidents that qualify as traumatic events involve sudden, catastrophic events (e.g., waking during surgery, anaphylactic shock).  Witnessed events include, but are not limited to, observing threatened or serious injury, unnatural death, physical or sexual abuse of another person due to violent assault, domestic violence, accident, war or disaster, or a medical catastrophe in one’s child (e.g., a life-threatening hemorrhage).  Indirect exposure through learning about an event is limited to experiences affecting close relatives or friends and experiences that are violent or accidental (e.g., death due to natural causes does not qualify).  Such events include violent personal assault, suicide, serious accident, and serious injury.  The disorder may be especially severe or long-lasting when the stressor is interpersonal and intentional (e.g., torture, sexual violence).

The response to the event must involve intense fear, helplessness, or horror.  In children, the response must involve disorganized or agitated behavior.  Characteristic symptoms include persistent re-experiencing of the traumatic event, persistence of stimuli associated with the trauma and numbing of general responsiveness and persistent symptoms of increased arousal.  The full symptom picture must be present for more than one month and the disturbance must cause clinically significant distress or impairment in social, occupational, or other important areas of functioning.

An individual will have persistent symptoms of anxiety or increased arousal not present before the trauma.  These symptoms can include difficulty falling or staying asleep that may be due to recurrent nightmares during which the traumatic event is relived.  Other symptoms can include hyper-vigilance and exaggerated startle response.  Some individuals report irritability, outbursts of anger, or difficulty concentrating or completing tasks.

Associated Descriptive Features and Mental Disorders 

Developmental regression, such as loss of language in young children, may occur.  Auditory pseudo-hallucinations, such as having the sensory experience of hearing one’s thoughts spoken in one or more different voices, as well as paranoid ideation, can be present.  Following prolonged repeated and severe traumatic events (e.g., childhood abuse or torture), the individual may additionally experience dissociative symptoms, difficulties in regulating emotions, and/or difficulties maintaining stable relationships.

When the traumatic event produces violent death, symptoms of both problematic bereavement and PTSD may be present.  Part of the difficulty in accurately diagnosing PTSD is that it is associated with many other anxiety and mental disorders.  For example, PTSD is also associated with increased rates of Major Depressive Disorder, Substance-Related Disorders, Panic disorder, Agoraphobia, Obsessive-Compulsive Disorder, Generalized Anxiety Disorder, Social Phobia, Specific Phobia, and Bipolar Disorder.  These disorders can precede, follow, or emerge concurrently with the onset of PTSD.

PTSD Prevalence Rates

In the United States, projected lifetime risk for PTSD using DSM-IV criteria at age 75 years is 8.7%.  Twelve-month prevalence among U.S. adults is about 3.5%.  Lower estimates of 0.5%-1.0% are seen in Europe, Africa, and Latin America.  The DSM-IV discusses community-based studies that reveal a lifetime prevalence for PTSD of approximately 8% of the adult population in the United States.  Information about general prevalence rates in other countries is not available.   Studies of at-risk individuals yield variable findings, with the highest rates (ranging between one-third and more than half of those exposed) found among survivors of rape, military combat and captivity, and ethnically or politically motivated internment and genocide.

Differential Diagnosis

PTSD can occur at any age, beginning after the first year of life.  Symptoms usually begin within the first three months following the trauma, although there may be a delay of months, or even years, before criteria for the diagnosis are met.  There is abundant evidence for what DSM-IV called “delayed onset” but is now called “delayed expression,” with the recognition that some symptoms typically appear immediately and that the delay is in meeting the full criteria.

The DSM-5 emphasizes that with PTSD, the stressor must be of an extreme, (i.e., “life-threatening) nature.  In contrast, other mental disorders often mistakenly diagnosed as PTSD include Adjustment Disorder, where the stressor can be of any severity.  The test also points out that not all psychopathology that occurs in individuals exposed to an extreme stressor should necessarily be attributed to PTSD and may be the result of many other mental disorders.  Mentioned are Acute Stress Disorder, Obsessive Compulsive Disorder, Schizophrenia, and other psychotic disorders or mood disorders with psychotic features.  Although a discussion of all diagnostic criteria is beyond the scope of this article, virtually each of the diagnostic criteria for PTSD emphasize that persistence of the symptoms, the re-experiencing of the event, and the avoidance of associated stimuli is essential.

Conclusion

Scott Brooksby recently cross examined a plaintiff’s forensic psychologist in a high-exposure personal injury case he was defending.  Plaintiff’s expert typically diagnosed more than half of those he evaluated with PTSD.  On cross-examination, this expert was not familiar with the prevalence rates, the specific criteria, or the comorbidity issues associated with PTSD and published in the DSM.  Most significantly, he could not describe the single most important feature for a diagnosis of PTSD: a “characteristic set of symptoms following exposure to one or more traumatic events.”  Instead, the expert merely opined that, in so many words, plaintiff was unhappy, withdrawn, and appeared to be troubled by a series of events.  The expert could not describe the relative significance of the plaintiff’s life events or link them to the specific criteria needed to achieve an accurate PTSD diagnosis.

It is important that the cross-examination specifically pin down the basis for the expert’s diagnosis, especially now with the much more detailed DSM-5, and the breaking up of many of the negative cognition clusters and a much more specific list of negative experience categories.

Even a comprehensive summary of the methodology for most effectively questioning or challenging a plaintiff’s claim of PTSD is beyond the scope of this blog post.  However, when cross-examining plaintiff’s expert witness regarding a PTSD diagnosis, defense counsel should always keep in mind that the plain text of the DSM-5, and examples of the trauma and criteria typically associated with PTSD, can often be easily contrasted with the data to disprove or cast doubt on the PTSD diagnosis.

Key Changes to the DSM-5 for the Product Liability, Personal Injury, and Aviation Defense Lawyer

DSM-5 book

The creation of the fifth edition of Diagnostic and Statistical Manual of Mental Disorders (DSM-5) was a massive undertaking that involved hundreds of psychiatrists, psychologists, physicians, and other medical professionals working together over a 12-year period.  The DSM-5, which replaced the 2000 DSM-IV (TR), is the foundation for reliable diagnosis and treatment of psychological and mental disorders.  As with prior DSM publications, which now date back decades, it is not intended to be a substitute for sound, objective clinical judgment, training, and skill.

Reflecting and prompted by the many new longitudinal studies, research papers, and experimental treatment modalities that have appeared since 2000, this new DSM edition contains significant changes in the classification of some disorders, and the removal or addition of other disorders.  This discussion will provide a brief overview of some of the key changes to the DSM-V and will touch on issues of interest to legal professionals working in the areas of product liability, personal injury, and aviation defense.

In a trial setting, familiarity with the DSM-5 and the underlying literature will be critical to an effective cross-examination of plaintiff’s expert.  Often, with forensic psychologists, the defense can make significant inroads on the basis that plaintiff’s expert is not sufficiently familiar with the DSM or associated literature.  For example, a significant new body of literature related to “resiliency and benefit realization” after a traumatic experience is largely unknown to most plaintiffs’ forensic psychologists.

A substantial percentage of high exposure cases in those categories involve a diagnosis of PTSD by plaintiff’s expert and a Global Assessment of Functioning (GAF) score based on the five-level multiaxial system, with Axis 5 providing the GAF score.  This brief post will focus on the changes to ­– or more accurately, the elimination of – the multiaxial system, as well as the changes to the criteria, symptoms, and diagnosis of PTSD.

A subsequent post will deal specifically with the criteria for PTSD and will include suggestions for cross-examination of plaintiff’s diagnosing mental health professional.

Changes to the Multiaxial System in DSM-5

Despite its widespread use, particularly among some insurance agencies and the government, the multiaxial system in DSM-IV was not required to make a mental disorder diagnosis.  DSM-5 has moved to a nonaxial diagnostic model (formerly AXES I, II, and III), with separate notations for important psychosocial and contextual factors (formerly Axis IV) and disability (formerly Axis V).  The approach of distinguishing diagnosis from psychosocial and contextual factors is also consistent with established WHO and ICD guidelines, which consider the individual’s functional status separately from his or her diagnosis or symptom status.

DSM-IV Axis V consisted of the Global Assessment of Functioning (GAF) scale, representing the clinician’s judgment of the individual’s overall level of “functioning on a hypothetical continuum of mental health-illness.”  It was recommended that the GAF be dropped from DSM-5 for a number of reasons, including its conceptual lack of clarity (e.g., including symptoms, suicide risk, and disabilities in the descriptors) and questionable psychometrics in routine practice.  In order to provide a global measure of disability, the WHO Disability Assessment Schedule (WHODAS) is included in DSM-5 for further study.

Changes to PTSD in DSM-5

Post-Traumatic Stress Disorder (“PTSD”) is a Trauma- and Stressor-Related Disorder.  DSM-5 criteria for PTSD differ significantly from the DSM-IV.  The stressor criterion (Criterion A) is more explicit with regard to events that qualify as “traumatic” experiences.  Also, DSM-IV Criterion A2 (subjective reaction) has been eliminated.

Whereas there were three major symptom clusters in DSM-IV – re-experiencing, avoidance/numbing, and arousal – there are now four symptom clusters in DSM-5 because the avoidance/numbing cluster is divided into two distinct clusters: avoidance and persistent negative alterations in cognitions and mood.  The latter category, which retains most of the DSM-IV numbing symptoms, also includes new or re-conceptualized symptoms such as persistent negative emotional states.  The final cluster – alterations in arousal and reactivity – retains most of the DSM-IV arousal symptoms.  It also includes angry outbursts and reckless or self-destructive behavior.

PTSD is now developmentally sensitive in that diagnostic thresholds have been lowered for children and adolescents.  Furthermore, separate criteria have been added for children age 6 years or younger with this disorder.

The DSM-IV childhood diagnosis of reactive attachment disorder had two subtypes: emotionally withdrawn/inhibited and indiscriminately social/disinhibited.  In DSM-5, these subtypes are defined as distinct disorders: “reactive attachment disorder” and “disinhibited social engagement disorder.”

Olson Brooksby is a product liability, personal injury, and aviation defense firm.

Evaluation of Potential Claims: Direct Negligence and Vicarious Liability

Oregon Negligence Law Changed Significantly in 1987

Oregon is a state that recognizes a cause of action for direct negligence and vicarious liability.  The lawyers at OlsonBrooksby frequently defend catastrophic personal injury, product liability, and aviation claims which contain causes of action based on direct negligence and vicarious liability.

First, we will discuss potential claims for direct negligence.  An understanding of negligence law in Oregon requires a brief discussion of pre- and post-1987 common law decisions.  Prior to 1987, Oregon generally held to a conventional approach to negligence cases, requiring the existence of a duty, a breach of that duty, causation, and damages.  However, as a result of cases decided in the period around 1987, common law negligence in Oregon now depends on whether the defendant’s conduct unreasonably created a foreseeable risk to a protected interest of the kind of harm that befell the plaintiff.

A Direct Claim For Negligence Can  Exist With Or Without The Fazzolari Special Relationship

The change from the strict adherence to the traditional common law elements of duty, breach, causation, and damages was a result of the Oregon appellate court’s perceived overuse of the cliché “duty” or “no duty.”  Oregon courts, therefore, began to encourage juries and judges to decide each case on its own facts.  Duty continues to play an affirmative role when the parties invoke a particular status, relationship, or standard of conduct beyond the standards generated by common law.  This was the result of the so-called Fazzolari principle, which now governs negligence law in Oregon.  See Fazzolari v. Portland School District 1J, 303 Or 1 (1987).

A special relationship is usually defined in the form of a fiduciary, contractual, or legal relationship such as guardianship.  Typically, the school–student relationship has been deemed a special relationship as contemplated by Fazzolari.

Fazzolari typically requires a three-part test:

  1. Determine whether a particular status, relationship, or standard exists;
  2. If so, analyze that status, relationship, or standard to determine whether a “duty” beyond that of ordinary care exists;
  3. If such a standard, relationship, or status is not alleged, then analyze the case under principles of general negligence based on foreseeability of risk of harm.

For example, suppose an employee of a sports club is involved in an accident in which a club member is injured.  Although there are no Oregon cases exactly on point, given the nature of the relationship between the employee and the club member, we do not believe that the member has a strong argument that a “special relationship” existed between himself and the sports club.

Let’s suppose further that the paperwork which was executed by the member consisted of the membership application and the general waiver of liability for use of the sports center facilities.  Suppose there were no detailed contractual provisions denoting certain services, obligations, or protections provided to, or expected of, the member.  Therefore, there was no fiduciary relationship.  Under these facts, a special relationship did not exist between the member and the sports club that typically would have invoked a duty of care to the member beyond that of the ordinary care extended to a business invitee.

Although courts have often found that schools are in a special relationship with their students, we do not believe that type of relationship is comparable to the sports club and its member.  This is because of the fundamentally voluntary nature of the sports club membership (without regard to the statutory abolition of assumption of the risk discussed below).  Moreover, we should assume that the sports club member was not a third-party beneficiary of any contract that existed between the sports club and a government agency or other third party.

For these reasons, we see nothing that would clearly take this hypothetical case out of the conventional principles of negligence and create a special relationship requiring examination on its own facts.

Although a special relationship may take a case out of the typical “duty” or “no duty” scenario, the harm to the protected interest of the putative plaintiff must still be reasonably foreseeable.  Therefore, given that, in this hypothetical “sports club / member” relationship scenario, we are operating under the principles of ordinary negligence, the appropriate standard in this case is that an organization’s conduct must not unreasonably create a foreseeable risk of harm to others.

Direct negligence claims are sometimes referred to as causes of action based on negligent hiring, negligent training, negligent supervision, or negligent retention.  The organization may be directly liable for negligence claims based on hiring, retention, supervision, or training if (1) it places a dangerous person in a position that poses an unreasonable risk of harm to others, and if (2) the organization knew of the danger or could have discovered the danger through reasonable investigation.

In the event there were other facts such as the following, it may support one or more of the sports club member’s claims for direct negligence:

  • Sports club failed to screen employees, including those that may have needed specialized training, i.e., lifeguards.
  • There is no documentation that sports club ever trained its employees, let alone the employee or employees who were involved with member’s hypothetical accident.
  • Employees displayed an attitude of disinterest, which may have affected their performance of safety related duties.
  • Sports club failed to maintain adequate documentation of employee performance in employee personnel files.
  • Employees had ambiguous or uncertain understanding of the proper safety protocol.
  • Sports club has a history of failing to comply with its own club procedures, resulting in similar prior injuries.
  • Sports club employee(s) admitted they were lazy, did not like their jobs, or were apathetic toward proper performance.
  • Sports club failed to develop adequate safety procedures, i.e., requiring employees or members to obtain and renew any type of skill or safety certification.
  • Sports club employee was not properly supervised, lacked familiarity with sports clubs rules and procedures, and was less experienced at a given task, i.e., weight training safety spotting, than many of the members.

In summary, if sufficient evidence exists of the sports club’s failure to properly hire, train, or supervise, or retain, the club would have an uphill battle defending against a direct negligence claim. 

Vicarious Liability 

Oregon is a vicarious liability state.  If, as in the example above, the sports club member made a claim that the sports club is vicariously liable for his alleged injury, he would argue that sports club, as the “master” of its employee or “servant,” is liable for its employee’s negligence in failing to protect what was a foreseeable interest in the kind of harm that befell the member.  Specifically, the member would allege that, due to the employee’s negligence in failing to supervise, the member was not properly protected from the injury of the type that befell him, and that the accident was foreseeable and preventable.  The employee must have been acting within the course and scope of his employment and have been motivated, in part, to serve the interests of the “master,” i.e., the sports club.

In a claim for vicarious liability, as discussed in more detail below, the sports club need not have played any role in the negligence itself, so long as it controls the actions of the negligent employee and the employee’s actions were performed within the course and scope of employment and performed, at least in part, to benefit the employer.

Regarding course and scope, an employee is acting within the course and scope of employment if three factors are present:

  1. The employee’s actions at the time of the accident substantially occurred within the time and space limits authorized by the employment;
  2. The employee was motivated, at least in part, by a purpose to serve the employer;
  3. The act is of a kind that the employee was hired to perform.

Chesterman v. Barmon, 305 Or 439, 442 (1988).

All three factors must be present for vicariously liability to withstand a challenge.

In vicarious liability cases, the best defense is that the employee committed an intentional act that fell outside the course and scope of his employment.  Nearly all the published cases where courts have held that the employee was acting outside the course and scope involve intentional acts of force committed by security guards, bouncers, bodyguards, etc.

Foreseeability Issues

Reasonable foreseeability is still a necessary aspect of negligence, in any form.  In the example above, where a sports club member is injured, depending on the nature of the injury, the sports club would need to consider the specific facts that gave rise to the claim and whether or not a jury would conclude that the injury was reasonably foreseeable.  From a defense perspective, arguing that reasonable foreseeability does not exist is an uphill battle in most cases.  Oregon law generally finds that an intervening act negates fault only in extreme cases, such as those involving criminals.  For example, in one of the seminal Oregon foreseeability cases, Buchler v. Oregon Corrections Division, 316 Or 499 (1993), an en banc decision, a prisoner on a work crew stole the prison van in which the guard had left the keys, drove to his mother’s home, stole a firearm, and later used it to kill someone in the van.  316 Or at 502.

The court noted that, while the defendant had a history of temper problems, there was nothing in his background that would ever suggest he would commit such a crime.  Id. at 507.  The court ultimately held that an intervening criminal instrumentality caused the harm and created the risk Id. at 510-11.  The court explained that, although “it is generally foreseeable that criminals may commit crimes and that prisoners may escape and engage in criminal activity while at large, that level of foreseeability does not make the criminal’s acts the legal responsibility of everyone who may have contributed in some way to the criminal opportunity.”  Id. at 511.

Conclusion

Product liability, catastrophic personal injury, and aviation claims, all of which Olson Brooksby frequently defend, require a clear understanding of which claims contain causes of action based on direct negligence and vicarious liability, and more importantly, what the elements are, so that proper defenses can be raised, and an investigation and discovery plan can be drafted, to attempt to defeat the claims.

Hoarding and its relation to fire, product liability, and personal injury cases

Tech room

Olson Brooksby regularly handles the defense in product liability and high-exposure negligence cases.  The purpose of this article is to make other defense firms aware of the new stand-alone designation for Hoarding presented in the latest (Fifth) version of the American Psychiatric Association’s Diagnostic and Statistical Manual (DSM-V).

As we mentioned in a previous blog post, the new DSM-V, which was published in May, 2013, includes “Hoarding Disorder” (often abbreviated “HD” in the literature) as a stand-alone mental disorder for the first time in the history of the APA’s DSM publication.  Although HD had been discussed in earlier versions of the DSM as an aspect of Obsessive Compulsive Disorder (OCD), it did not provide anywhere near the detail of diagnostic criteria that the DSM-V provides.  Moreover, recent studies show that hoarding and OCD are not as similar as previously thought.

The new hoarding diagnosis could have important implications in the product liability defense context.  Some studies suggest that as many as six percent of all house fires are the direct result of hoarding.  With any product producing a heat source sufficient to cause a fire if used improperly, placing combustible materials in sufficient quantity, or sufficient proximity, to the ignition source has the potential to cause a fire.  This is often the scenario with fires involving hoarding behavior.

Will a hoarding diagnosis provide the product manufacturer a defense, based on misuse of the product, and thereby dispose a jury to allocate a significant percentage of comparative fault to a diagnosed hoarder?  Or will jurors be more inclined to sympathize with, or overlook, the hoarding behavior and be lenient in the assignment of comparative fault to the hoarder?  Since the hoarding diagnosis is new, this remains to be seen.

The Basic DSM-V Diagnostic Criteria

The basic criteria for a diagnosis of hoarding include:

  1.  Persistent difficulty discarding or parting with possessions, regardless of their actual value.
  2. This difficulty is due to a perceived need to save the items and to the distress associated with discarding them.
  3. The difficulty discarding possessions results in the accumulation of possessions that congest and clutter active living areas and substantially compromise their intended use.  If living areas are uncluttered, it is only because of the interventions of third parties (e.g., family members, cleaners, authorities).
  4. The hoarding causes clinically significant distress or impairment in social, occupational, or other important areas of functioning (including maintaining a safe environment for self and others).
  5. The hoarding is not better explained by the symptoms of another mental disorder (e.g., obsessions in obsessive-compulsive disorder, decreased energy in major depressive disorder, delusions in schizophrenia or another psychotic disorder, cognitive deficits in major neurocognitive disorder, or restricted interests in autism spectrum disorder).

The Essential Diagnostic Features

A complete treatment of the diagnostic features of this newly categorized stand-alone mental disorder is beyond the scope of this article.  The essential feature of hoarding disorder is “persistent difficulties discarding or parting with possessions, regardless of their actual value.  (Criterion A).  The word persistent indicates a long-standing difficulty rather than more transient life circumstances that may lead to excessive clutter, such as inheriting property.  The difficulty in discarding possessions noted in Criterion A refers to any form of discarding, including throwing away, selling, giving away, or recycling.  The main reasons given for these difficulties are the perceived utility or aesthetic value of the items or strong sentimental attachment to the possessions.  Some individuals feel responsible for the fate of their possessions and often go to great lengths to avoid being wasteful.

Specifiers

Approximately 80%-90% of individuals with hoarding disorder display excessive acquisition features.  The most frequent form of acquisition is excessive buying, followed by acquisition of free items (e.g., leaflets, items discarded by others).  Stealing is not common.  Some individuals may deny excessive acquisition when first assessed, but this symptomology may appear later during the course of treatment.  Individuals with hoarding disorder typically experience distress if they are unable to, or are prevented from, acquiring items.

Prevalence, Development and Course

Nationally representative prevalence studies of hoarding disorder are not available.  Community surveys estimate the point prevalence of clinically significant hoarding in the United States and Europe to be approximately 2% – 6%, or roughly between 6 and 15 million Americans.  Hoarding symptoms may first emerge between the ages of 11 and 15, start interfering with the individual’s function by the mid-20s, and cause clinically significant impairment by the mid-30s.  Most participants in clinical studies are in their 50s, with the severity increasing with each decade of life.  Hoarding symptoms appear to be almost three times more prevalent in older adults (ages 55 – 94 years) compared with younger adults (ages 34 – 44 years).  Most study participants report the disorder symptoms a nearly constant presence, and not episodic.

Pathological hoarding in children is easily distinguishable from developmentally saving and collecting behaviors.  Hoarding behavior is familial, with about 50% of individuals who hoard reporting having a relative who also hoards.  Twin studies indicate that approximately 50% of the variability in hoarding behavior is attributable to additive genetic factors.  Approximately 75 metropolitan communities in the United States have task forces to address this disorder.

Hoarding Disorder AS Distinct From Obsessive Compulsive Disorder

When defending a product liability case that resulted in a fire, it will be important to understand the new research distinguishing hoarding from OCD.  A new study, authored by Dr. David Tolin in the Journal of the American Medical Association, shows that patients with hoarding disorder exhibit different brain activity during decision making than patients with OCD, pointing to a biological distinction.  Dr. Jeff Szymanski of the International OCD foundation reported that after the study, they concluded that a hoarder is not a pack rat, a slob, or lazy.  “A part of their brain doesn’t work the way your brain works.”

Dr. Tolin used brain imaging (fMRI) to test how 107 people reacted when asked whether they wanted to keep a piece of junk mail or discard it.  Sometimes it was junk mail that belonged to the patient, and sometimes it belonged to someone else.  Forty-three participants had hoarding disorder and another 31 had OCD, or obsessive compulsive disorder, according to the study.

When the junk mail had a hoarding patient’s name on it, certain parts of that patient’s brain lit up, showing “abnormal activity” in the decision-making regions (the anterior cingulated cortex and the insula), according to the study.  When the mail listed someone else’s name, the same parts of the hoarder’s brain were abnormally quiet.  According to Tolin, “only hoarding patients showed this kind of activity, and OCD patients did not.

Conclusion

Now that Hoarding Disorder (HD) is a distinct, APA sanctioned, mental disorder, it will likely have ramifications in product liability cases for both plaintiffs and defendants.  Given the relatively high number of fires, usually implicating a product, defense attorneys involved in product liability litigation will need to understand the disorder in those cases where HD is suspected.  Because jurors may tend to sympathize with hoarders, who are often characterized by their counsel as suffering from something akin to a mental handicap (thereby – erroneously – relieving them of any fault), the impact of HD may be greater on product liability defense counsel than on plaintiffs’ counsel.

Oregon Law Requires Places of Public Assembly (Including Large Brick and Mortar Retailers) To Have At Least One Automated External Defibrilator

Premises owners should be aware that at least one automated external defibrillator (“AED”) may be required in their buildings.  On January 1, 2010, Senate Bill (S.B.) 556, codified as ORS 431.690, took effect, requiring certain building owners to place at least one automated external defibrillator (“AED”) on their “premises.”  The requirement applies to “places of public assembly” which are defined as “facilities” that have at least “50,000 square feet” of “floor space” and where: (1) the “public congregates for purposes such as deliberation, shopping, entertainment, amusement or awaiting transportation;” or “business activities are conducted;” and (2) at least 25 people “congregate” there on a “normal business day.”  S.B. 556 (1)(a)-(b).

In 2011, S.B. 1033 amended ORS 431.690 to require the placement of at least one AED in public and private schools and health clubs as well.

In other words, businesses and facilities with over 50,000 square feet of floor space must have a defibrillator on their premises if at least 25 people “congregate” there on a normal day.  A copy of the statute requiring AEDs is found at http://www.oregonlaws.org/ors/431.690

It is safe to assume that most product manufacturing facilities comprise 50,000 or more square feet.  However, despite the fact that this law has been in effect for more than three years, many Oregon businesses affected by the law are not compliant.

Discussion

The AED law does not provide a definition for the word “congregate,” nor does it specify whether 25 people must be present at one time or can come and go over the course of an entire business day.  When Oregon courts interpret ambiguous language, they focus primarily on the text and context of the statute and secondarily on legislative history.  State v. Gaines, 346 Or. 160, 172, 206 P.3d 1042 (2009).  When analyzing the text of a statute, it is useful to consider the dictionary definition of any ambiguous words.  The dictionary definition of “congregate” is “to come together; to assemble; to meet,” or “to collect into a group, crowd, or assembly.”   Black’s Law Dictionary 301 (6th ed., West 1990), Merriam Webster’s Collegiate Dictionary 243 (10th ed., Merriam-Webster, Inc. 1997)

Given the dictionary definitions, one could reasonably argue that the new law applies only to businesses that have at least 25 people present at some point during the day (i.e. “assembled” or “together” at one time).  However, the legislative history of the bill may suggest a different interpretation.  S.B. 556 originally had no 25-person requirement, and therefore would have applied to all businesses with floor space exceeding 50,000 square feet.  This specification requiring at least 25 people to congregate was added by way of an amendment suggested during a work session of the Health Care and Veterans’ Affairs Committee (held on April 4, 2009).  At that meeting, Senator Wayne Morse expressed concern that the bill would require industrial warehouses with very few employees to install AEDs.  One of the bill’s sponsors, Senator Jeff Kruse, agreed and said that they intended the bill to apply to “big department stores,” shopping centers, “office buildings” and the like, but not sparsely populated warehouses.  Relying on this legislative history, it is more likely that the 25 person requirement was not intended to exempt stores that have more than 25 visitors during a day even if they are not all present at the same time.

For a business such as a large brick and mortar retailer, there are two threshold questions that determine whether ORS 431.690 (S.B. 556 applies).  First, does the store or other business have over 50,000 square feet of floor space?  And, second, do at least 25 people congregate at the business on a typical business day?  If the answer to both questions is yes, the business is subject to the AED requirement.  If a minimum of 25 people did not congregate during a typical business day, then there is a good argument that the business would be exempt from the law.

Note that the statute places no limitations on the reason the 25 people have congregated in one place.  The statute provides a nonexclusive list of some of the reasons people have for gathering in these places – “deliberation, shopping, entertainment, amusement or awaiting transportation.”  In the context of a “big box” retailer, for example, the 25 people would likely consist of any person present in the store including, but not limited to, all employees, shoppers, repair or maintenance contractors, or anyone else visiting the store.

Although this insight into the legislative history may be interesting, businesses should not get lost in debating the letter of the statute or meaning of what “congregate” signifies.  If the business believes it might in any way meet the parameters of the statutory requirements, they should simply install an AED.

The law does not specify where the AED should be located or contain any provisions regarding access.  The law merely specifies that the AED shall be “on the premises.”  Based on the absence of any specification, it does not appear that the AED necessarily need be available to any member of the public in the establishment at the time the AED is needed.

Part of S.B. 556 (now codified at ORS 30.802) Provides Protection From Liability For Those Who Comply With The AED Requirement

A provision of S.B. 556, now codified at ORS 30.802, provides a fairly broad immunity provision for those locations which comply with the statutory requirement and maintain an AED on premises, so long as the business is in compliance with the particulars of the immunity provision such as making sure there are employees trained in the use of the AED.  A copy of the statute providing liability protection is found at  http://www.oregonlaws.org/ors/30.802

The cost of AEDs has dropped precipitously with increased competition and more efficient mass production.  The benefits of compliance with the Oregon statute, including immunity from suit, vastly outweigh the risks of non-compliance.  Moreover, there is conclusive evidence that AEDs save lives.  If you have questions, please contact our office.

Olson Brooksby often represents national retailers with large brick and mortar locations.

Why Are There So Many Helicopter-Related Air Medical Operations Accidents?

Helicopter Air Medical Operations Accidents are relatively high when compared to 14 C.F.R.§ 121 (Part 121) accidents.  According to the NTSB, which is charged with investigating every aviation accident in the United States and many abroad, there were no fatalities in any Part 121 accidents in 2010.  This despite some 17.5 million flight hours.  Of those Part 121 accidents, the most common defining event, accounting for 26% of such accidents in 2010, was a turbulence encounter.  The remaining defining events for Part 121 accidents in 2010, just as they generally have been for the last 10 years, involved ground collisions, ground handling, runway incursion, cabin safety, system failure, and bird strikes etc., many or most of which are ground events.  Less than half of Part 121 accidents happened en route, although a significant number occurred during takeoff or landing.

Part 121 flights, as opposed to HEMS flights under Part 135 or Part 91, have distinctly different flight altitudes, flight durations, weather events, cruise speeds, air frame, and power plant configurations and thrust capacities.  No one, including the NTSB, suggests that the high number of turbulence-related incidents involved in Part 121 operations should also characterize helicopter flight generally, particularly Helicopter Emergency Services (“HEMS”) flight.  There is no evidence that turbulence, as understood in the context of Part 121 statistical treatment of accidents, has played any significant causal role in the relatively high number of HEMS mishaps, whether they resulted in injuries/fatalities or not.  Given the incredibly low statistical number of injury/fatality mishaps in Part 121 operations compared to the high incidences of injury/fatality HEMS mishaps, what, if any, conclusions can be drawn?

Air medical operations are conducted under both Part 135 and Part 91, depending on whether patients are being carried on board the aircraft.  HEMS missions en route to pick up patients or organs, or to reposition aircraft after accomplishing patient transport operations, are generally conducted under Part 91.  Trips transporting patients or organs to medical facilities are conducted under Part 135.  Some air medical helicopter operations, particularly for emergency medical services, are conducted by state or local government entities as public use flights, whether patients are on board or not.

Although fixed-wing aircraft are also used for Part 91 and Part 135 medical missions, there were only 10 fixed wing fatalities in air medical operations during the entire decade between 2000 and 2009.

A Statistical Overview of HEMS Accident Frequency and Type

HEMS accounted for about 80 percent of all air medical accidents during the ten-year period 2001-2010.  Against this backdrop, we examine HEMS accidents, of which there were 13 in 2010 alone, seven of them fatal, according to a 2012 NTSB report. Six of the seven HEMS fatalities in 2010 involved operations under Part 91.  From 2000 through 2010 (the most recent year NTSB statistics are available), 33 percent of HEMS accidents were fatal.  Most HEMS accidents occurred during airborne phases of flight, and during 2010, all HEMS fatalities occurred during airborne phases of flight.

Obviously, this is explained in part by the fact that unlike fixed-wing air medical operations, HEMS flights generally do not operate out of established aerodromes.  Instead, they operate out of off-airport locations where patients are in need of timely, critical care.  According to a 2011 NTSB report, in every year except 2007, the number of Part 91 air medical helicopter accidents without patients aboard have been significantly higher than in any other category of air medical flying.

It may be useful to break down the 31 accidents involving thirty-two helicopters in air medical operations between 2007-2009.  Eighteen were being operated under Part 91, thirteen were conducted under Part 135, and one was conducted as a public use flight.  Eleven of the accidents, involving twelve helicopters, were fatal.  Collision with objects on takeoff or landing accounted for 7 of the 31 accidents, but no fatalities.

On the other hand, four of the five controlled flight into terrain accidents were fatal, including the crash of the Maryland State Police public use flight carrying accident victims on approach to Andrews Air Force Base.  Two of the three loss of control in-flight accidents were fatal, as were two of the three unintended flights into instrument meteorological conditions accidents.  The midair collision between two HEMS helicopters conducting Part 135 operations in Flagstaff, Arizona, in June 2008 was also fatal to everyone on board.  The other two fatalities involving a non-power plant system were coded as “other”, according to a 2011 NTSB report.  

What Are The Typical Causes 

In any aviation operation, pilot training, experience, and judgment are some of the most important factors in safe flight.  With helicopter operations generally, and particularly HEMS operations, those factors are even more critical because of the conditions they fly in, such as bad weather, night flying, or flying in rural areas where wires or other low strike points may not be lighted or marked, and air-traffic may be uncontrolled.  HEMS operations also face an unparalleled need for speed to save lives.  Review of individual NTSB probable cause reports, NTSB factual data, and other aviation industry data would tend to suggest that helicopter accidents and resulting serious injuries and fatalities are most often the consequence of a number of factors, including loss of control, visibility issues, wire strikes, system component failure, or post-impact fire.

Although some of these issues pose dangers during Part 121 operations, they simply do not pose the same risks, largely due to obvious differences in the nature of the aviation operation, the equipment, altitude, avionics, take-off and landings from tightly controlled air-space, and the use of aerodromes.  In addition, HEMS operations often involve situations in which minutes may literally save life and limb, prompting hurried behavior.  While that is not to suggest that HEMS pilots are not some of the best helicopter pilots flying, they do face particular challenges, to which Part 121 pilots or even fixed-wing air medical operations pilots are less exposed.

There are also tremendous variations in helicopter air medical pilot training.  From 2007-2009, for example, NTSB data suggest that the accident helicopter pilots’ median age was 54, ranging from 35 to 69.  Median total flight hours were 7,125 with a range from 2,685 to 18,000.  The median time in the type of accident helicopter was 375 hours, ranging from 11 to 4,241.  NTSB statistics from 2011 suggest that such variations in flight time and the corollary impact on experience and judgment may be significant factors in the number of crashes. HEMS operations more often than not must use unimproved landing sites at accident scenes and helipads and hospitals or medical facilities.  Loss of control in flight was the most common event for both fatal and non-fatal helicopter crashes, followed by collisions on takeoff or landing and system component failure of the power plant.

Even though HEMS pilots may have thousands of flight hours and are unquestionably some of the best helicopter pilots in the world, owners and operators of HEMS facilities should continuously examine and emphasize the consistent causes of HEMS crashes and adapt training programs to focus on those causes.

Olson Brooksby has an active aviation accident and aviation component product liability defense practice.  For more information, please contact our office.

Oregon is a Modified Comparative Fault State

Oregon’s comparative fault statute, ORS 31.600, and the related Uniform Civil Jury Instructions, provide that the trier of fact shall compare the fault of the claimant with the fault of any party against whom recovery is sought, the fault of third-party defendants who are liable in tort to the claimant, and the fault of any person with whom the claimant has settled.  In other words, the jury will be charged with allocating fault to all parties on the verdict form, including parties who have settled.  The percentages must equal 100% for a valid verdict.  Liability is several in Oregon and each party pays their allocated percentage of fault.

While a party may blame all fault on parties who are immune (such as an employer in a work-related personal injury case) and who, therefore, are not included on the verdict form, only those parties on the verdict form, including settled parties, will have fault allocated to them by the jury.  Oregon is a several liability state.  The comparative fault scheme is modified comparative.

Any compensatory damages awarded to plaintiff will be reduced by the corresponding percentage of comparative fault allocated to plaintiff by way of the affirmative defense of comparative fault.  Therefore, assuming that plaintiff’s own fault would be raised as an affirmative defense in a product liability case, plaintiff would be on the verdict form.  Any fault allocated to one or more plaintiff would reduce his or her verdict by the percentage of fault allocated to him or her.  If the fault allocated to a plaintiff is 51% or more, his or her recovery is barred entirely.

The jury must be told that an allocation of fault to the plaintiff will result in a reduction of the plaintiff’s award in proportion to the percentage of fault allocated.  Although settled parties are on the verdict form, and the jury is required to compare the fault of all parties on the verdict form in making their allocation, the jury is prohibited from being informed that any of the parties on the verdict form have settled.  See ORS 31.605.

Immune parties, such as those who are protected by the exclusive remedy provision (e.g., the employer), are not subject to tort liability to the injured worker and, therefore, are not placed on the verdict form, and no percentage of fault can be allocated to them.  However, the comparative fault statute does not prevent a party from alleging that the party was not at fault because the injury was the sole and exclusive fault of a person who is not a party.  In other words, although the jury may determine that an employer who was compliant with worker’s compensation is 100% at fault, they cannot allocate partial fault to the complying employer and the rest of the fault to those on the verdict form.

Under Oregon law, fault may be allocated to a plaintiff’s family member or friend.  For example, in cases involving children, failure to supervise may warrant a claim against a child plaintiff’s parents.  For example, in order for the jury to allocate fault to a parent who was negligent in failing to supervise his or her child, the parent must be a party to whom fault can be allocated on the verdict form.  The parent in this hypothetical will only be on the verdict form if a cross-claim or third-party claim properly alleges the specifications of negligence against the parent.  Defendant would then have the burden of alleging and proving that the parent’s own negligence, in failing to act reasonably to avoid causing injury to the child, was a substantial contributing factor in the accident and injury.

In the absence of proper specifications of negligence at the directed verdict stage against the parent (or any third party, and including the comparative fault of plaintiff), the judge could strike that party from the verdict form, and no fault could be allocated to them.

“Secondary Processes” Don’t Translate to Secondary Risks

Steel manufacturers know that the global demand for steel is almost always increasing, and customers require greater engineering performance.  Customers also require variations in the performance characteristics of specialized, costly alloys, which warrant investment in safe, efficient QC testing equipment.  Specialized components, such as those used in aviation, require precision machining.  Aircraft turbine engine compressor blades, for example, may require precision casting to tolerances of seven microns or less.

The urgency to increase production and focus on key production values can sometimes lead to risk of serious workplace injury, often due to under-recognized dangers in secondary processes.  QC testing operations – where injuries often involve equipment that lacks necessary retrofitting with safety devices, or compliance with published ANSI, ASTM, ISO, or other industry standards – is a case in point.

Additionally, secondary processes like QC testing are what might be called “first assignment” areas for new, contract, or temporary workers who all too often are under-trained and unaware of the potential dangers of metal production.

The “class” of worker is noteworthy because the differing ways in which injury compensation is handled have financial implications for the employer.  Basically, employees are limited to the exclusive remedy provision of worker’s compensation law, which does not provide for non-economic damages.  Other classes of workers may be able to sue for non-economic damages, resulting in verdicts or settlements that can cripple a company.

Our firm was involved in a real-world example as counsel for a large steel mill that burns roughly 30,000 quality-control test samples a year.  In that case, eight-foot-long, 500-pound tail samples were cut from sheet steel in the main roller room and were channeled onto a customized metal roller conveyor system that diverted samples to the sample burning room.  A series of gates restrained and managed each sample’s movement along the conveyor until a final gate clamped down on the tail sample so a laser could cut the sample into smaller segments for QC testing.

In this case, however, with the final gate on the conveyor shut, the penultimate gate opened, freeing an uncut tail sample to continue down the conveyor and collide with the slab in the clutch of the final gate.  The uncut slab careened into the air, striking an employee in the head.  The injured employee was hired through a service, and it was his first day on the job.

It was a tragedy in personal terms, and the steel company lived up to its responsibilities to the injured worker.  Additionally, by following a number of prudent practices, both before and after the accident, the company was protected from legal action that might have created a serious financial threat to the business.  Here are some operations and legal steps every metal manufacturer should consider to reduce personal injury on the job and damaging financial liability in secondary process areas:

  • Immediately examine older equipment and put requisite safeguards into place.  It is natural to be focused on mainline production safety and operations.  However, a safety audit may reveal necessary retrofitting in areas such as QC sampling.  In this case, a post-accident engineering study resulted in the installation of horizontal spacers spanning the conveyor track to prevent tail samples from jumping the conveyor.  The spacers were not required by written standard, but they provided extra safety.
  • Ensure compliance with published industry standards.  The litany of ASTM, ANSI, OSHA, ISO, and other standards for production of metal and component parts and machine safety is beyond the scope of this article.  Consider retaining an occupational safety engineer to conduct an audit that closely assesses older QC test equipment.
  • Ensure that contracts with any temporary worker service providers expressly state that the provider will provide worker’s compensation coverage.  For your employees, worker’s compensation is the “sole remedy” for claims in the event of workplace injury.   However, temporary, contract and other classes of workers – again, often placed in secondary process positions – may be able to sue under Employer Liability Law (“ELL”) that can include non-economic damages such as pain and suffering.

To maintain consistent standards of coverage and liability across a mixed workforce, your worker-service contracts need to delineate that your contractor’s worker’s compensation coverage is the sole remedy for temporary workers.  Although plaintiffs may challenge contractual provisions in court, manufacturers should put in place contractual indemnity provisions that result in consistent protection across all worker classes and forms of claims.

  • Ensure that contracts contain an indemnity provision providing that the service provider will fully indemnify the metal manufacturer for injuries of any kind to the temporary worker.  Clauses that provide an exception for the “sole negligence of the manufacturer” can often lead to expensive litigation and leave the door open for exposure.  Protect your company by resisting the inclusion of such language in your service contracts.

To close, as important as it is for metal manufacturers to meet growing demand and concentrate on the principal staffing, processes, and equipment of main-line production, experience indicates that the dynamics and risks associated with secondary production processes also deserve increased attention.

Punitive Damages

Initially Pleading the Claim for Punitive Damages is Not Permitted in Original Complaint

Punitive damages are permitted in Oregon in product liability actions. Under Oregon law, at the time of filing a pleading with the court, the pleading may not contain a request for an award of punitive damages. ORS 31.725. At any time after the pleading is filed, a party may move the court to allow the party to amend the pleading to assert a claim for punitive damages. The party making the motion may submit affidavits and documents in support of the claim and the party opposing may do the same. Punitive damages in Oregon are an element of damages, and do not constitute a separate claim for relief. Under Oregon law, insurance coverage for punitive damages is permitted.

The Standard for Pleading Punitive Damages

Oregon has a relatively low bar for the inclusion of a claim for punitive damages. Plaintiffs need only present “some evidence” of the conduct that may give rise to punitive damages. ORS 31.725(3)(a). The showing necessary for the amendment is equivalent to a prima facie case that would merely need to withstand a motion for directed verdict at the time the amendment is sought. We emphasize that this showing of “some evidence” is a low bar, particularly in Multnomah County Circuit Court. In most cases, when plaintiffs intend add a claim for punitive damages, they will expressly state in the initial complaint an intent to move to amend to do so.

In most counties in Oregon, punitive damages are generally not allowed in simple negligence cases. However, in Multnomah County Circuit Court, we have seen simple negligence cases where judges have allowed punitive damages to go to the jury.

The Clear and Convincing Standard and Evidence of Conduct Required at Trial

In order to actually obtain an award of punitive damages from the jury, as opposed to merely obtaining permission from the judge to request punitive damages in an amended complaint, Oregon law requires imposition of a clear and convincing standard. Punitive damages are not available unless the plaintiff proves by clear and convincing evidence that the party against whom punitive damages are sought has acted with malice or has shown a reckless and outrageous indifference to a highly unreasonable risk of harm and has acted with a conscious indifference to the health, safety and welfare of others. ORS 31.730.

If a jury awards punitive damages, the court is required to review the award to determine whether the award is within the range of damages that a rational juror would be entitled to award based on the record as a whole, as well as statutory and common law factors. ORS 31.725 et. seq.

Statutory Allocation of Awards of Punitive Damages

With respect to the distribution of punitive damages, the percentages of the total award are all prescribed by statute. ORS 31.735. Under the statute, the State of Oregon takes 60% of every punitive damage award away from the plaintiff and puts it in the state crime victim’s fund. Then, plaintiff receives 30% and the attorney is paid an amount out of this 30%, but in no event more than 20% of the total punitive damages awarded. Finally, 10% is payable to the Oregon Attorney General for deposit in the State Court Facilities and Security Account. Plaintiff’s lawyers know this, so they often try to push harder to get the jury to award noneconomic damages. They may even decide to forego a punitive damages claim to avoid the risk of having a lower noneconomic damages award and a high punitive damages award that will go mostly to the state of Oregon. In cases with exposure to significant punitive damages, the Oregon Justice Department will often file a peremptory lien against the punitive damages to ensure proper distribution.

Damages Caps

There are no relevant damages caps on personal injury actions, as opposed to wrongful death actions. While Oregon case law has upheld a cap of $500,000 in noneconomic damages in wrongful death cases, the Oregon Supreme Court has declined to impose such a cap on noneconomic damages in personal injury cases on the basis that a personal injury cause of action was recognized at common law at the time of the adoption of the Oregon Constitution. In contrast, the Oregon Supreme Court upheld the statutory cap on noneconomic damages because the wrongful death action is a creature of statute, and a cause of action that did not exist at the time of the ratification of the Oregon Constitution.

One important note about the noneconomic damages cap of $500,000: While the cap has now been upheld by the Oregon Supreme Court in an en banc decision, this does not prevent the plaintiffs from pleading any amount they want to in the complaint. Under the statute, the jury is never told of the cap, and if the verdict for noneconomic damages exceeds the cap, it is the judge, not the jury, who reduces the verdict to $500,000 before entering the judgment. The judgment, rather than the verdict, is technically the document that has legal force. The entry of the judgment either starts the 30-day period in which to file a notice of appeal, or allows the plaintiff to execute on the judgment (collect either through voluntary payment or seizure of assets).

For example, let’s consider a hypothetical aviation crash. Suppose wife/mother is injured and her husband and son are killed. She could theoretically file a lawsuit demanding $50,000,000.00 in noneconomic damages for both her deceased son and husband. If the case went to trial under that scenario, and that amount was awarded, the judge, unbeknownst to the jury, and after the jury is excused from service, would reduce the verdicts in the two wrongful death cases to $500,000 each in noneconomic damages before entering the judgment.

A boutique litigation firm serving Oregon and Washington