January 21, 2022
Arguments Advanced by PLAC: PLAC argued that the Supreme Court should grant review because the question presented is incredibly important. The Georgia Supreme Court's ruling violates precedent and undermines the constitutional requirements that limit when a state court may exercise personal jurisdiction over an out-of-state entity. Under controlling precedent, a corporation is subject to general personal jurisdiction only in those states in which it is fairly regarded as home. In conflict with that precedent, the Georgia Supreme Court has held that a corporation is deemed to have consented to general personal jurisdiction if it registers to do business within the state. If it is not corrected, the Georgia Supreme Court's decision will impose a heavy burden on interstate commerce without serving any legitimate state interests.

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Background: Plaintiff experienced issues with his Daikin-brand HVAC system which was designed, manufactured, sold and installed by corporate entities other than Daikin NA, which only sold replacement parts to Plaintiff. Plaintiff asserted claims against defendants for breach of express warranty, breach of the implied warranty of merchantability, intentional and negligent misrepresentation and violation of M.G.L. c. 93A.

The Court also addressed other issues PLAC raised in its amicus brief, including that the district court improperly held J&J responsible for harm allegedly caused by opioids sold by other companies. In addition, the Court recognized a manufacturer lacks control over its product once sold, noting a “product manufacturer’s responsibility is to put a lawful, non-defective product into the market. There is no common law tort duty to monitor how a consumer uses or misuses a product after it is sold.”

Following motions for summary judgment, only Plaintiff's claims for breach of the implied warranty of merchantability, misrepresentation, and violation of M.G.L. c. 93A were allowed to proceed to trial. The jury held Daikin NA liable for $10 million even though plaintiff’s own expert testified defects elsewhere in the HVAC system - for which Daikin NA was not responsible - caused the replacement parts (sold to Plaintiff for less than $9,000) to fail prematurely.

Daikin NA filed a motion for judgment notwithstanding the verdict and a motion for a new trial or remittitur. Both motions were denied and Daikin NA appealed.

Result: The SJC granted Daikin NA's application for direct appellate review, reversed the trial court's decision, and remanded for reconsideration of damages on the tort claim. The SJC concluded that given the absence of evidence of any defect in the coils Daikin NA distributed, the component parts doctrine precluded Plaintiff's breach of warranty claim against Daikin NA.

Significance: The SJC's decision extended tort-based component parts doctrine to UCC merchantability claims for purely economic loss. It adopted the position PLAC urged that the component parts doctrine applies to non-standalone components that have no functional capability unless integrated into other products, to specialized components that are designed only for use in an integrated product, and to both tort and warranty claims.

In its decision, the SJC acknowledged the amicus brief submitted by PLAC.

A copy of the SJC's decision and PLAC’s brief, authored by James M. Campbell and Christopher R. Howe (Campbell Conroy & O'Neil, PC), are available for download below.

View PLAC’s Brief View the Court’s Opinion

In reversing the district court, the Oklahoma Supreme Court offered a sound and detailed analysis of the numerous reasons nuisance law should not apply to the sale of products, providing persuasive authority for other courts throughout the United States addressing similar theories of liability. The Court adopted the rationale urged in PLAC’s amicus brief, recognizing that “[p]ublic nuisance and product-related liability are two distinct causes of action, each with boundaries that are not intended to overlap,” and that “public nuisance is fundamentally ill-suited to resolve claims against product manufacturers.”

The Court also addressed other issues PLAC raised in its amicus brief, including that the district court improperly held J&J responsible for harm allegedly caused by opioids sold by other companies. In addition, the Court recognized a manufacturer lacks control over its product once sold, noting a “product manufacturer’s responsibility is to put a lawful, non-defective product into the market. There is no common law tort duty to monitor how a consumer uses or misuses a product after it is sold.”

The first certified question asks whether Connecticut law recognizes a tort cause of action based on a medical device manufacturer’s alleged failure to report adverse events to the FDA and comply with post-approval requirements. The questioning from the Court focused on a provision of the state’s product liability statute providing that a product warning may be inadequate if it is not devised to communicate “with the person best able to take or recommend precautions against the potential harm.” The Court’s questioning suggests it may be divided as to whether a regulatory agency like the FDA fits within this statutory text. Traditionally, this provision in medical device cases has been interpreted to apply solely to doctors consistent with the learned intermediary doctrine. The Court was also interested in the extent to which out-of-state decisions that the parties cited dealt with similar statutory language.

The second certified question asks whether Connecticut’s product liability statute bars a claim under the state’s consumer protection statute based on a medical device manufacturer’s alleged deceptive and aggressive marketing of its product. There were very few questions from the Court on this topic. The limited questioning focused on the scope of the plaintiff’s marketing claim and the extent to which the marketing claim is simply a veiled product defect claim.


View PLAC’s Brief View the Court’s Opinion