Dow Chemical Co. v. Ebling

753 N.E.2d 633

The DOW CHEMICAL COMPANY, Dowelanco a/k/a Dow Agrosciences LLC, Eli Lilly & Co., Rofan Services Inc., and Epco, Inc., Appellants-Defendants, Louisville Chemical Co., Inc., Appellant-Defendant, Affordable Pest Control, Inc., Appellant-Defendant, v. Todd EBLING and Cynthia Ebling, individually and as Husband and Wife, and as Parents of Christina Ebling and Alex Ebling, Appellees-Plaintiffs.

No. 22S05-0008-CV-481.

Supreme Court of Indiana.

August 23, 2001.

Stanley C. Fickle, Robert D. MacGill, Dean T. Barnhard, Joseph G. Eaton, William E. Padgett, Barnes & Thornburg, Indianapolis, IN, Richard Mullineaux, Kightlinger & Gray, LLP, New Albany, IN, Janet Barbre Norton, Dow Agrosciences LLC, Indianapolis, IN, Attorneys for Appellant Dow Chemical Co.

Gene F. Zipperle, Jr., Crafton, Martin & Zipperle, Louisville, KY, Attorney for Appellant Affordable Pest Control.

John W. Bilby, Henry S. Alford, Middleton & Reutlinger, Jeffersonville, IN, Attorneys for Appellant Louisville Chemical Co.

Roger L. Pardieck, Karen M. Davis, Pardieck & Gill, Seymour, IN, John Vargo, Janet O. Vargo, Pardieck & Gill, Carmel, IN, Attorneys for Appellees.

ON PETITION TO TRANSFER

DICKSON, Justice.

In this interlocutory appeal, defendants Dow Chemical Company, Dowelanco n/k/a Dow Agrosciences LLC, Eli Lilly & Company, Rofan Services, Inc., and Epco, Inc. (herein collectively referred to as Dow); Louisville Chemical Company, Inc. (LCC); and Affordable Pest Control, Inc. (Affordable); challenged the denial of their motions for summary judgment in a damage action brought by plaintiffs Todd and Cynthia Ebling alleging that their children were injured as a result of exposure to pesticides manufactured and applied by the defendants. Finding primarily that the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)¹ preempted the plaintiffs' claims based on failure to warn and failure to disseminate information to commercial applicators for distribution directly to the persons whose residences are to be sprayed, the Court of Appeals concluded that the defendants were entitled to summary judgment as to some, but not all, of the plaintiffs' claims against each defendant. Dow Chemical Co. v. Ebling, 723 N.E.2d 881 (Ind.Ct.App.2000). In response to the plaintiffs' request for our review of the FIFRA preemption issue, we granted transfer and hold that FIFRA does not preempt the plaintiffs' failure to warn claims against Affordable. In all other respects, we summarily affirm the Court of Appeals.²

The plaintiffs contend that their two young children experienced respiratory disorders, developmental delays, brain damage, and seizure disorders as a result of being repeatedly exposed to Dursban 2E and Creal-O when their apartment was regularly sprayed over an eleven-month period without being warned of the dangers surrounding the exposure to these pesticides. A more detailed description of the facts may be found in the opinion of the Court of Appeals. Id. at 889-90.

Affordable acknowledges that the plaintiffs alleged various theories of recovery including failure to warn, strict liability, negligence, and willful/wanton misconduct. Br. of Appellant Affordable Pest Control, Inc. at 2. Requesting judgment in its favor as a matter of law as to each of these claims, Affordable filed a motion for summary judgment, which was denied by the trial court. Upon Affordable's interlocutory appeal from the denial of its motion for summary judgment, the Court of Appeals concluded that preemption by FIFRA precluded plaintiffs' claim that Affordable had an obligation to warn them of the potential adverse effects of Dursban. The court further held that, because the transaction was predominately for the sale of a service rather than a product, Affordable was entitled to summary judgment on the plaintiffs' claims for strict liability under both the Indiana Products Liability Act and common law strict liability for ultra-hazardous activity. The Court of Appeals held, however, that summary judgment was properly denied on the plaintiffs' negligence claim against Affordable because genuine issues of material fact existed regarding whether Affordable breached its duty of reasonable care by applying an excessive amount or concentration, by failing to properly ventilate the plaintiffs' apartment, and by spraying Dursban in an area near the children's clothes and toys. The court also affirmed the denial of summary judgment as to the plaintiffs' request for punitive damages against Affordable. On transfer, the plaintiffs challenge only the FIFRA preemption issue. The plaintiffs urge that FIFRA does not preempt their state common law cause of action asserting that Affordable's duty of reasonable care included an obligation to provide them with the information contained in the EPA-approved Dursban label.

As to its appellate claim of FIFRA preemption, Affordable argues that the principles of preemption for failure to warn claims apply to pest control applicators "just as they do to manufacturers." Br. of Appellant, Affordable Pest Control, Inc. at 10. Support for this position is found in Hottinger v. Trugreen Corp., 665 N.E.2d 593 (Ind.Ct.App.1996), trans. denied, which affirmed partial summary judgment in favor of a lawn care company that had applied a chemical subject to FIFRA. In Hottinger, the Court of Appeals summarily concluded that "FIFRA preempts state common law strict liability and negligence claims for defective warnings or the failure to warn of hazards associated with the products subject to regulation under the Act." Id. at 598. We did not review this conclusion.³ It has been settled since M'Culloch v. Maryland, 17 U.S. (4 Wheat.) 316, 427, 4 L.Ed. 579 (1819), that state law that conflicts with federal law is "without effect." Maryland v. Louisiana, 451 U.S. 725, 746, 101 S.Ct. 2114, 2129, 68 L.Ed.2d 576 (1981). However, as the United States Supreme Court has explained:

[B]ecause the States are independent sovereigns in our federal system, we have long presumed that Congress does not cavalierly pre-empt state-law causes of action. In all pre-emption cases, and particularly in those in which Congress has "legislated ... in a field which the States have traditionally occupied," Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 1152, 91 L.Ed. 1447 (1947), we "start with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress." Ibid.; Hillsborough Cty., 471 U.S. at 715-716, 105 S.Ct. at 2371; cf. Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 22, 107 S.Ct. 2211, 2223, 96 L.Ed.2d 1 (1987).

Medtronic, Inc. v. Lohr, 518 U.S. 470, 485, 116 S.Ct. 2240, 2250, 135 L.Ed.2d 700, 715 (1996). This presumption against preemption is especially weighty in an area of traditional state responsibility such as health and safety, the area involved in this case. See id.

The reach of federal preemption was increased with the Supreme Court's decision in Geier v. American Honda Motor Co., 529 U.S. 861, 120 S.Ct. 1913, 146 L.Ed.2d 914 (2000). Before Geier, if a federal law had an express preemption clause, the reach of the preemption was limited to the domain expressly preempted. Medtronic, 518 U.S. at 485, 116 S.Ct. at 2250, 135 L.Ed.2d at 715. Geier held that even though a state law is not within the domain expressly preempted, the state law may yet be preempted if it frustrates the purpose of the federal law or makes compliance with both impossible. 529 U.S. at 870, 120 S.Ct. at 1919, 146 L.Ed.2d at 924. A federal statute may now preempt state law "by express language in a congressional enactment, see, e.g., Cipollone v. Liggett Group, Inc., 505 U.S. 504, 517, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992), by implication from the depth and breadth of a congressional scheme that occupies the legislative field, see, e.g., Fidelity Fed. Sav. & Loan Assn. v. De la Cuesta, 458 U.S. 141, 153, 102 S.Ct. 3014, 73 L.Ed.2d 664 (1982), or by implication because of a conflict with a congressional enactment, see, e.g., Geier v. American Honda Motor Co., 529 U.S. 861, 869-874, 120 S.Ct. 1913, 146 L.Ed.2d 914 (2000)." Lorillard Tobacco Co. v. Reilly, 533 U.S. ___, 121 S.Ct. 2404, 2414, 150 L.Ed.2d 532, 550 (2001).

The United States Supreme Court has considered a FIFRA preemption claim in only one case. In Wisconsin Public Intervenor v. Mortier, 501 U.S. 597, 111 S.Ct. 2476, 115 L.Ed.2d 532 (1991), it declined to extend FIFRA preemption to preclude local regulations requiring a pesticide applicator to give notice of pesticide use and of any label information prescribing a safe reentry time, and imposing fines in the event of violations. After finding that preemption was not required by either the language of FIFRA or its legislative history, the Court also determined that there was no implied field preemption and no actual conflict between FIFRA and the local ordinance. The Court concluded by holding that FIFRA did not preempt the local governmental regulation of pesticide use. Id. at 616, 111 S.Ct. at 2487, 115 L.Ed.2d at 550. Mortier did not, however, involve an alleged preemption of state tort law, and it predated the expansion of federal preemption principles in Geier and Lorillard. In determining the pre-emptive effect of a federal statutory provision, "[c]ongressional purpose is the `ultimate touchstone' of our inquiry." Lorillard, 533 U.S. at ___, 121 S.Ct. at 2414,150 L.Ed.2d at 550. Both the language of the preemption statute and the statutory framework surrounding it provide the primary basis for determining Congress's intent. Medtronic, 518 U.S. at 486,116 S.Ct. at 2250-51,135 L.Ed.2d at 716. The history of FIFRA provides insight into the structure and purpose of the statute as a whole:

FIFRA was enacted in 1947 to replace the Federal Government's first effort at pesticide regulation, the Insecticide Act of 1910, 36 Stat. 331. 61 Stat. 163. Like its

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