Court Tosses $10 Million Verdict in Volvo Liability Case

Court Tosses $10 Million Verdict in Volvo Liability Case

ALBANY – The State’s highest court threw out a $10 million verdict and ordered a new trial for a man who lost a leg when he was pinned against a house by a driverless Volvo, finding the trial judge gave an instruction to jurors designed for malpractice cases, not those involving defective product design.

The 5-1 Court of Appeals said the effect of Justice Marcy Friedman’s (See Profile) error was apparent by the “inconsistent” nature of the Manhattan Supreme Court jury’s verdict in Reis v. Volvo Cars of North America, 138: Jurors found for plaintiff Manuel Reis on his negligent design claim, but for Volvo on Reis’ design defect claim.

While neither of the parties objected to the inconsistent nature of the verdict before the jury was discharged, the court noted that an appeal by Volvo seeking summary judgment decided by an Appellate Division, First Department, essentially kept the automaker’s challenge on jury instruction alive for post-verdict review.

The Court of Appeals’ ruling overturned a 3-2 First Department determination that upheld the verdict against Volvo but with a $168,000 downward adjustment in damages.

At issue was the extent of Volvo’s liability for failing to install a $5 starter safety interlock ignition device until the early 2000s. Without it, Volvos with manual transmissions could lurch forward when the ignition was turned.

Reis said he was in Yonkers looking at the engine of a 1987 Volvo station wagon his friend had just bought in May 2002 when his friend reached through the driver’s side window and started the vehicle. Reis was crushed against the house, requiring his left leg to be amputated above the knee.

Reis’ products liability and negligence suit contended that Volvo violated customary safety practices in the auto industry by not installing the interlock safety device in its vehicles, as many of its competitors had done by 1987.

Judge Robert Smith (See Profile), writing for the majority, said the Pattern Jury Instruction 2:15 (Common Law Standard of Care—Defendant Having Special Knowledge) was designed for professional malpractice cases. It uses what he referred to as a “community standard” of care where a doctor or lawyer is held to the “level of skill and care used by others in the community who practice the same profession.”

Smith wrote that the proper charge for the jury in negligence cases is a “reasonable person standard.”

“In negligent design/design defect cases, the reasonable-person standard has been given more specific form: the question is whether the product is one as to which ‘if the design defect were known at the time of manufacture, a reasonable person would conclude that the utility of the product did not outweigh the risk inherent in marketing a product designed in that manner,’” Smith said, quoting Voss v. Black & Decker Mfg., 59 NY2d 102 (1983).

Smith conceded that the difference between the “community standard” and “reasonable person standard” is a subtle one—in some cases, he said, an error such as the one which occurred in the Reis trial might not require reversal “so long as the charge as a whole adequately explains general negligence principles.”

But here, he said, “we have no such confidence,” noting that the inconsistency of the verdict reached by the jury on the negligent design and on the design defect claims “leads us to believe that the error in the charge … may have confused the jury.”

Smith said the court had no such problem with Friedman’s use of PJI 2:16 (Common Law Standard of Care—Customary Business Practices), which asked jurors about whether Volvo used business practices that could be considered unreasonable when measured against “general” customs and standards observed by other auto manufacturers. PJI 2:16 provided jurors with more leeway than PJI 2:15 did as presented by Friedman, Smith said.

“PJI 2:15, as given here, told the jurors flatly that ‘Volvo has special skills in designing and manufacturing automobiles,’ and said that if Volvo failed to meet community standards the jury ‘must find that Volvo was negligent,’” Smith wrote. “But PJI 2:16 told the jury that it should ‘decide from the evidence … whether there was a general custom or practice,’ and that if it found there was it ‘may take that general custom or practice into account.’”

Chief Judge Jonathan Lippman (See Profile) and Judges Susan Phillips Read (See Profile), Eugene Pigott Jr. (See Profile) and Jenny Rivera (See Profile) were in the majority.

The dissenter, Judge Victoria Graffeo (See Profile), said the delivery of PJI 2:15 was one of those instances where reversing the verdict was not required.

She wrote that PJI 2:15 “merely repeated a similar standard of care” that Friedman also asked jurors to consider in her charge under PJI 2:125 (Products Liability—Negligence), which the judge had given at Volvo’s insistence.

She said there was “ample” evidence to support the jury’s negligent design verdict.

Reis’ attorney, Kreindler & Kreindler partner Steven Pounian, said he was disappointed with the ruling. Pounian said that, taken together, Friedman’s instructions properly gave jurors the information they needed to reach a fair verdict.

“We argued that it [the allegedly faulty charge] made no difference,” Pounian said in an interview Wednesday. “There was a clear negligence case, and the jury found negligence.”

Roy Reardon and Andrew Amer, partners at Simpson Thacher & Bartlett, represented Volvo along with Hardin, Kundla, McKeon & Poletto partners Mark Kundla and Stephen Donahue.

Reardon declined comment Wednesday.

Judge Shiela Abdus-Salaam (See Profile) took no part in the decision. She had written the dissenting opinion in the First Department, finding that a new trial was warranted because the jury’s inconsistent verdict indicated that it was confused by improper jury instructions.

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