Answering a question certified to it by a federal court, the North Dakota Supreme Court has ruled 3-2 that the seller of an allegedly defective meat grinder cannot be held liable as a manufacturer of the product under state law; the court thus declined to adopt the “apparent manufacturer” doctrine espoused in the Restatement (Second) of Torts § 400 or Restatement (Third) of Torts: Product Liability § 14. Bornsen v. Pragotrade, LLC, No. 20110087 (N.D., decided September 15, 2011).
Without providing a factual basis for its certified question, the federal court asked whether North Dakota would adopt the apparent manufacturer doctrine. The issue arose when defendant Cabela’s Retail, Inc. filed a motion to dismiss claims involving a meat grinder it sold to the plaintiffs. They had also sued the product’s manufacturer, basing their claims on alleged design defect and failure to warn. The plaintiffs contended that Cabela’s was not entitled to dismissal because it was an “apparent manufacturer” of the product.
The state supreme court relied on the plain language of a state law applicable to products liability actions to conclude that sellers are not liable when the manufacturer is subject to suit and where the seller (i) did not exercise significant control over the design and manufacture, (ii) did not have actual knowledge of the product defect, or (iii) did not create the product defect causing the harm. According to the court, the statute evidences the legislature’s intent to “sharply curtail the liability of a ‘nonmanufacturing seller.’” The court thus indicated that it would not adopt the common-law “apparent manufacturer” rule.
The dissenting justices would have declined to answer the certified question, “[o]n the state of the record before this Court.” They said, “The statement of facts in a certification order should present all of the relevant facts. The purpose is to give the answering court a complete picture of the controversy so that the answer will not be given in a vacuum.” They further observed, “[A]n undeveloped record creates risks of unintended consequences,” and noted that this precise shortcoming made it impossible to determine whether “Cabela’s satisfies the definition of a ‘manufacturer’ or the possible application” of other statutory exceptions.
According to the dissenting opinion, “Cabela’s name was prominently engraved on the meat grinder and displayed on the informational brochures and packaging for the meat grinder, but this record does not reflect who prepared those documents or caused the name to be engraved on the grinder.” The opinion also notes that the record “does not establish the relationship between Pragotrade and Cabela’s” and thus, “[i]t is unknown to this Court what control Cabela’s exercised over the product causing the injury.”