When is a Shirt a Service?: How Sophisticated Plaintiffs are Repackaging Claims to Maximize Results

11/19/2012

Is that a product or a service? Seems like a simple question. To an ordinary consumer, the answer is simple: a car, a door or a piece of furniture are all products. Car repairs, a door installation or custom furniture design are all services. The apparently simple determination of whether something is a product or a service can have a monumental impact on the outcome of a product liability case. Some states, such as Connecticut, have a product liability statute which completely controls a plaintiff's product liability claim. This statute, CT ST § 52-572m, is the sole Connecticut remedy for injuries caused by a product. Negligence, strict liability and warranty claims for injuries sustained by a product are specifically barred. Based on the restrictions contained with some states' product liability statutes, as well as some inherent advantages in service-related claims, an increasing number of product liability cases are being pursued on service-based negligence grounds. See Richard L. Cupp Jr. & Danielle Polage, The Rhetoric of Strict Products Liability Versus Negligence: An Empirical Analysis, 77 N.Y.U. L. Rev. 874, 924 (2002)(explaining that a study revealed that jurors responded more favorably to plaintiffs - in terms of both the likelihood of success and verdict size - whose claims are based on negligence rather than strict liability).

Sophisticated plaintiffs are cleverly repackaging product liability civil actions as service-related claims against some defendants to gain procedural advantages. Most notably, plaintiffs have defeated defendants' motions for summary judgment by asserting service-based negligence claims. By characterizing their claim as service-based, plaintiffs increase their chances of defeating a motion for summary judgment and advancing their case to trial because negligence is primarily a question of fact for the jury. See 57A Am. Jur. 2d Negligence § 17. In their attempt to expand the number of parties responsible for injuries in product liability cases, plaintiffs' attorneys have purposefully clouded the determination of whether an event is related to a product or a service to take advantage of more favorable laws to maximize defendants' liability.

Two recent cases highlight this increasing trend. In Mack v. General Electric Company, 2012 WL 4717918, an injured laborer sued his employer-shipbuilder for injuries he sustained during the construction of a Navy ship. The plaintiff claimed the Navy ship itself was both a product and a service. The U.S. District Court of the Eastern District of Pennsylvania granted defendants' motion for summary judgment on plaintiff's products liability claims, holding that a ship was not a "product" within the meaning of strict product liability law. However, it denied defendants' motion for summary judgment on plaintiff's other claims explaining that "the role of the builder of Navy ships appears to be more like a provider of a service (assembly of an assortment of products)." The court considered this a question of fact for the jury and allowed plaintiff's service-related negligence claim to proceed to trial.

Similarly, in an even more overt attempt to defeat a defendant's motion for summary judgment, the plaintiff in Hathaway v. Cintas Corporate Services, Inc., No. 1:10 CV 195 (U.S. Dist., Ct., N.D. Ind., Fort Wayne Div.) sued Cintas, the uniform company that supplied, laundered, and repaired his work shirts, for injuries he sustained when sparks from his welding caused his shirt to catch fire. The plaintiff claimed that the shirt was both a product and a service. Realizing that he was likely to lose on his product claims, the plaintiff argued that his case should proceed to trial because the relationship between Cintas and the plaintiff's employer was "primarily a service relationship, with goods only incidentally involved." Id. at 16. The court granted Cinitas' motion for summary judgment on plaintiff's product liability claims, but denied its motion for summary judgment on the service-based claims. The court explained that "a reasonable jury could find that the relationship in this case was predominantly for the sale of a service" and allowed the plaintiff's service-related negligence claim to proceed to trial.

These cases - and others - highlight a new repackaging trend by plaintiff attorneys. Service-related negligence claims are more likely to survive a motion for summary judgment and provide procedural advantages as well as more potential liability. As long as plaintiffs continue to find success re-characterizing product liability injuries as service-based claims, this trend is likely to continue. Product manufacturers should consider how they promote their products as this may create additional - and unintended - liabilities.

For more information about developing trends in product liability litigation or how to best protect your business, please contact David Governo (dgoverno@governo.com) or William Gallitto (wgallitto@governo.com).


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