Texas Court of Appeals: Executives Not Liable for Personal Injury

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When plaintiffs are allegedly injured on a business’ premises, they may seek to cast a wide net and sue not just the corporation that owned the premises, but its executives as well, likely seeking additional leverage for settlement and more pockets from which to recover. A Texas court of appeals recently rejected such a suit against individual executives, holding the claims barred unless the executives owed an independent duty to plaintiff beyond that owed by the business itself.

In In re: Charles Butt, Craig Boyan, Carmen Gellhausen and Kevin Holguin, case number 13-16-00132-CV, the plaintiff alleged that he slipped and fell at Texan grocery store chain H.E.B.  In addition to suing the corporation, plaintiff also sued four of its top executives, claiming they were liable because they did not exercise reasonable care in directing H.E.B.’s policies. The H.E.B. executives moved to dismiss, arguing that H.E.B.’s corporate form insulated them from liability.  The trial court, however, denied the executive’s motion and they appealed.

The Texas Court of Appeals reversed, holding that corporate employees were only liable for personal injury if they owe “an independent duty of reasonable care to the injured party apart from the employer’s duty.” Accordingly, an employee could be liable if he or she “personally creates a dangerous situation that causes injury,” or “directs or participates in a tortious act.” The court determined that in the present case, the plaintiff had not alleged any facts that would support the contention that the executives had an independent duty to the plaintiff beyond H.E.B.’s duty. Analyzing the complaint, the court emphasized that the allegations against the executives were identical to those against H.E.B., and noted that “[s]uch undifferentiated allegations are insufficient to support a conclusion that [the executives] individually owed the [plaintiff] an independent duty of care” because of either their positions or their actions. The court ruled that the suit against the individual executives must be dismissed, and granted the executives attorneys’ fees.

Although perhaps not the most interesting fact pattern, this case caught our eye because it shows that defendants need to stay vigilant to guard against claims that seek to push the boundaries of traditional tort law and expand concepts of duty and liability beyond those that have been well-settled.

 

“Human FlyPaper” Patent for Self-Driving Cars Raise Questions About Duty Owed under Tort Law

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Here at Weil’s Product Liability Monitor, we have kept a close eye on developments related to self-driving vehicles.  Over the past year, we have examined what issues regulators, legislatures and Courts will have to grapple with if autonomous automobiles become a road reality (see here), how automobile manufacturers have responded to product liability concerns (see here) and the intersection between cybersecurity vulnerabilities and driverless cars (see here).  Next up is Google’s latest patent: “human flypaper.”

Last week the U.S Patent & Trademark Office issued a patent to Google for an adhesive cover that would attach to the hood of its driverless vehicles.  The sticky paper would be covered with a coating that breaks on impact to expose its “human flypaper.”  See patent article.  What’s the point?  In the event an autonomous automobile collides with a pedestrian, the human would stick to the hood of the car to prevent her from bouncing off of the car and incurring additional injury after the initial impact.

Google believes that in the unfortunate event of a collision between any vehicle—driverless or manned—and a pedestrian,  injury to the pedestrian is often also caused by the secondary impact once she ricochets off the surface of the moving vehicle, not just the primary impact.  Id.  The adhesive layer to Google cars targets this secondary injury.

To date, most automobile manufacturer safety features focus on occupants inside the vehicle—not pedestrians. By contrast, legislatures are concentrating their efforts on pedestrian safety initiatives.  For example, in November 2014, New York City embarked on a public safety campaign and passed legislation to lower the maximum speed limits on residential streets from 30 mph to 25 mph.  See article.

To bring a successful tort action, a plaintiff must of course demonstrate she was owed a duty by the alleged liable party.  Google’s affirmative steps to protect pedestrians outside of their vehicles raises questions about whether the company—or others like it—are creating a duty under which future plaintiffs may hold them liable for injuries.  This is particularly interesting if Google uses its newest invention on traditional cars, and not just its own driverless cars.

From a policy perspective, Courts may have to consider the deterrent effect that expanding duties may have on safety innovations.  In other words, is it wise to penalize Google for its undertaking measures to prevent these secondary impact injuries?  We will continue to seek answers to these compelling questions and developments in the realm of autonomous autos.

FDA Issues Final Ruling on New Regulations for E-Cigarettes

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On May 5, 2016, the U.S. Food and Drug Administration issued a long-awaited final ruling regarding the regulation of electronic cigarettes (“e-cigarettes”) and other tobacco products, including hookah and pipe tobacco, and cigars. See Press Release, U.S. Food and Drug Administration, FDA takes significant steps to protect Americans from dangers of tobacco through new regulation (May 5, 2016), http://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm499234.htm (hereinafter “FDA Press Release”). Most notably, as part of these far-reaching regulations, the FDA announced that it would now ban the sale of e-cigarettes to anyone under the age of 18.  The new measures go into effect in ninety days. Id. at ¶4.

As reported on this blog, the FDA previously announced in April 2011 that it would regulate e-cigarettes as tobacco products under the Family Smoking Prevention and Tobacco Control Act of 2009. The FDA, however, had not released any regulations until now. In fact, prior to the issuance of this rule, there was no federal law prohibiting retailers from selling e-cigarettes, hookah tobacco, or cigars to people under the age of 18. See FDA Press Release at ¶4. In the absence of such federal laws, many states have already imposed a variety of measures to regulate the sale of e-cigarettes.

The FDA’s final rule is “aimed at restricting youth access” and imposes sweeping regulations, including:

  • Not allowing products to be sold to persons under the age of 18 years (both in person and online);
  • Requiring age verification by photo ID;
  • Not allowing the sale of covered tobacco products in vending machines (unless in an adult-only facility); and
  • Not allowing the distribution of free samples.

Id. at ¶4. Of note, at this time the rule does not prohibit the use of flavors in e-cigarettes. Sylvia Burwell, secretary of Health and Human Services said in a press conference that, while the FDA is interested in the issue of flavoring in e-cigarettes, further study was needed before imposing relevant regulations.

The rule also subjects “all manufacturers, importers, and/or retailers of newly-regulated tobacco products to any applicable provisions,” including registering with the FDA, listing all ingredients, and putting health warnings on all packaging and advertisements. FDA Press Release at ¶11. Specifically, the requirements include:

  • Registering manufacturing establishments and providing product listings to the FDA;
  • Reporting ingredients, and harmful and potentially harmful constituents;
  • Requiring premarket review and authorization of new tobacco products by the FDA;
  • Placing health warnings on product packages and advertisements; and
  • Not selling modified risk tobacco products (including those described as “light,” “low,” or “mild”) unless authorized by the FDA.

Id. at ¶12. Further, manufacturers of all newly-regulated products that were put on the market after February 15, 2007 must now get FDA approval by showing “the products meet the applicable public health standard set forth in the law and receive marketing authorization from the FDA.” Id. at ¶6.

The FDA notes that these requirements bring the e-cigarette industry in line with other tobacco products that the FDA has regulated since 2009 under the Tobacco Control Act. Id. at ¶11. Nonetheless, further developments in and challenges to the implementation of these newly-issued regulations will be of considerable interest to those in the tobacco industry, as well as those companies that produce products that are regulated by the FDA.

We will continue to monitor the developments and challenges in this area.

 

The “Speed” of Technology Leads to Litigation

According to the National Conference of State Legislatures, 46 States now prohibit all drivers from text messaging while driving. See full list.  Unfortunately, technology often advances at a rate faster than legislation can respond, leading to increased lawsuits while parties attempt to allocate liability.  Now that legislatures have tackled texting, youngRead the full article →