The Economic Loss Doctrine and Other Property

Ralph Anzivino continues his exploration of the economic loss doctrine in a new paper on SSRN.  The economic loss doctrine indicates that economic losses resulting from a defective product are recoverable, if at all, under contract law, instead of tort law.  In applying this doctrine, however, courts have run into difficulty with damage to other property besides the defective product.  For instance, in one case, a ship caught fire and sunk as a result of defective hydraulic equipment, and the court had to decide whether the ship owner could recover the value of other equipment on the ship under a tort theory of strict products liability.  Courts have adopted a variety of conflicting and uncertain tests to determine whether such damages to other property are governed by tort or contract law. 

In his paper, Ralph proposes a new test that emphasizes contract principles first.  Parties should be permitted to allocate the risk of losses between themselves.  Thus, if a contract validly addresses losses to other property, Ralph would enforce the contract; otherwise, tort principles would apply.  He defends this approach as clearer and more consistent with the underlying purposes of the economic loss doctrine than approaches currently in use.

Entitled “The False Dilemma of the Economic Loss Doctrine,” Ralph’s paper is forthcoming in the Marquette Law Review.  His other recent articles on the economic loss doctrine are here, here, and here.

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Sykes, Sotomayor, and Women Judges

I had the opportunity last week to attend Women Judges’ Night, an event that the Association for Women Lawyers presents annually (indeed, this year’s dinner was the thirtieth such). The Hon. Diane S. Sykes, L’84, of the United States Court of Appeals for the Seventh Circuit, delivered what was billed as a keynote but was also in the nature of after-dinner remarks. The speech was a very good example of either form, for reasons related to its warmth, its willingness to take on a substantive and even somewhat contentious topic, and the speaker’s self-awareness and humor.

Judge Sykes began with a “confess[ion]”:

[T]the idea of a “Women Judges Night” has always made me vaguely uneasy. I’m uncomfortable with the implications and consequences of gender-identity politics—or any identity politics, for that matter. When we celebrate Women Judges Night every year, what is it precisely that we’re celebrating? If we’re celebrating the appointment or election of women judges just because they are women, then I think we are making a mistake about the qualities necessary in a good judge, which of course are not gender-specific. If we’re celebrating the appointment and election of women judges because they subscribe to a gender-based brand of judging, then we are making an even bigger mistake about the nature of the judicial role. I don’t think we’re celebrating either of these things, but I do think it’s important for us to be careful not to diminish the contributions of women judges by emphasizing their gender as if it had something to do with their qualifications for judicial office or has substantive significance in their work.

She would conclude with her own assessment of what the event celebrates, along the way touching upon matters from Madison to Washington, D.C.—from her former court, a majority of whose justices were in attendance (viz., Chief Justice Shirley S. Abrahamson, Justice Ann Walsh Bradley, Justice Annette K. Ziegler, and Justice Patience D. Roggensack, the last of whom introduced Judge Sykes), to the United States Supreme Court and, in particular, last year’s confirmation of Justice Sonia Sotomayor. 

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Big Win for Plaintiffs in Dukes v. Wal-Mart

Walmart_1 Looks like a big win for the plaintiffs in the gigantic employment discrimination class action in Dukes v. Wal-Mart (a group of some 2 million former and current female employees have sued over lack of promotion opportunitie).  The 9th Circuit en banc, 6-5 with four separate opinions and 137 pages, affirmed class certification under Rule 23(b)(2) for some issues and remanded on others:

We affirm the district court’s certification of a Federal Rule of Civil Procedure 23(b)(2) class of current employees with respect to their claims for injunctive relief, declaratory relief, and back pay. With respect to the claims for punitive damages, we remand so that the district court may consider whether to certify the class under Rule 23(b)(2) or (b)(3). We also remand with respect to the claims of putative class members who no longer worked for Wal-Mart when the complaint was filed so that the district court may consider whether to certify an additional class or classes under Rule 23(b)(3).

The decision was written by Judge Hawkins, with a concurrence by Graber, one dissent by Ikuta and a separate dissent by Kozinski. The latter I am sure is fodder for a cert petition and I do believe this case is heading for a Supreme Court showdown.

Melissa Hart and I have written about how the social framework testimony of William Bielby was crucial, and properly admissible, in establishing the commonality and typicality prong for class certification.

Hat Tip: Rebecca Hamburg

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