Illinois Appellate Court Considers Product Liability Case Where Judgment Against Defendant is Uncollectible

The Illinois Appellate Court for the 1st District reversed and remanded a decision entered by a judge in the Circuit Court of Cook County. The issue on appeal was focused on a non-manufacturing defendant in a product-liability case. The defendant identified the manufacturer in order to be dismissed from strict liability in a tort claim. There was a question as to whether the manufacturer was not subject to the court’s jurisdiction and whether the plaintiff should be permitted to reinstate the non-manufacturing defendant.

In this case, Martin Cassidy was working at a warehouse when a flexible bulk container belonging to China Vitamins ripped and leaked, which made the entire stack of containers unstable. One of the stacked containers fell on Cassidy, injuring him.

In 2007, he filed a lawsuit against China Vitamins. The lawsuit alleged strict liability, negligent product liability and one count under res ipsa loquitur.

China Vitamins admitted that the company distributed the goods in the containers but denied it had manufactured either the goods or the container.

China Vitamins moved to dismiss for failure to state a cause of action in the res ipsa loquitur charge since Cassidy chose not to allege exclusive control.

China Vitamins, who is headquartered in Bedminster, N.J., moved for dismissal of the liability counts arguing that it was simply a distributor of bulk vitamins. China Vitamins was not involved in the construction, design or manufacture of the container. The company never had possession or control over the container and neither created nor had any actual knowledge of any defect in the container.

China Vitamins alleged that the product was sent directly from China by way of a shipping container and then by rail directly to the customers, never passing into its control. China Vitamins identified the producer of the vitamins as Nhu and the producer of the container as Taihua Group. Nhu and Taihua Group are both Chinese corporations. China Vitamins requested that, since it was a non-manufacturing defendant, it should be dismissed. The court did dismiss China Vitamins as the defendant, replacing it with Taihua Group.

Taihua Group failed to retain counsel or file a supplemental appearance and after a prove up, a default judgment was entered against Taihua Group for $9,111,322.27. After attempts to discover assets, it was learned that Taihua Group had no assets in Illinois and was outside of the jurisdiction of Illinois courts and therefore not obligated to respond to state court actions under international law.

Cassidy moved to reinstate China Vitamins as a party defendant under Section 2-621(b)(3) and (4) of the Illinois Code of Civil Procedure. The Circuit Court judge originally granted the motion, but following a motion to reconsider China Vitamins, the court denied the motion and held that the order was final and appealable.

Cassidy appealed, arguing that Section 2-621(b)(4) of the Code permitted him to reinstate China Vitamins as a party defendant. That section states: “The plaintiff may at any time subsequent to the dismissal move to vacate the order of dismissal and reinstate the certified defendant or defendants provided plaintiff can show one or more of the following: . . . (4) That the manufacturer is unable to satisfy any judgment as determined by the court.”

China Vitamins cited the appellate court decision in Chraca v. U.S. Battery Manufacturing Co., 2014, for the proposition that a company is only found “unable to satisfy any judgment” when it is shown to be bankrupt or nonexistent and Cassidy presented no evidence that Taihua Group was either.

The appellate court in this case found that the Chraca decision was flawed and not persuasive. The court stated that the established way a party may be “judgment-proof” is if they “do not own enough property within the court’s jurisdiction to satisfy the judgment.”

There was a dissent filed that supported the Chraca decision. However, the appellate court majority reversed the Circuit Court’s decision and sent the case back with instruction for the court to consider whether the Taihua Group is  unable to satisfy any judgment pursuant to Section 2-621(b)(4).

Martin Cassidy v. China Vitamins, LLC, et al., 2017 IL App (1st) 160933, Feb. 5, 2018.

Kreisman Law Offices has been handling product liability lawsuits, pharmaceutical defect cases and catastrophic injury cases for individuals, families and their loved ones who have been injured, harmed or killed by the negligence of another for more than 40 years, in and around Chicago, Cook County and its surrounding areas, including Maywood, Naperville, Waukegan, Winfield, Lake Zurich, Highwood, Highland Park, Homewood, Lincolnshire, Lake Villa, Chicago (Wicker Park, Rogers Park, North Lawndale, South Shore, East Side, Logan Square), New Lenox, Lansing, Lemont and Worth, Ill.

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