Kay Eloise Robinson Eva May Robinson Harry Robinson and George Samuel Robinson v. Audi Nsu Auto Union Aktiengesellschaft and Volkswagen of America, Inc.

Citations: 739 F.2d 1481; 16 Fed. R. Serv. 622; 1984 U.S. App. LEXIS 20366Docket: 82-1480

Court: Court of Appeals for the Tenth Circuit; July 19, 1984; Federal Appellate Court

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The case involves the Robinson family, plaintiffs-appellants, who filed a products liability lawsuit against Audi NSU Auto Union Aktiengesellschaft and Volkswagen of America, Inc., defendants-appellees, following a severe rear-end collision on an Oklahoma highway. The collision, caused by a drunk driver of a Ford Torino traveling at approximately ninety miles per hour, resulted in significant damage to the Robinsons' Audi, with the rear end crushed up to twenty-four inches and the fuel tank punctured, leading to a fire that severely burned the plaintiffs.

The plaintiffs alleged that the Audi was defectively designed and unreasonably dangerous due to the placement of the gas tank, which was vulnerable to puncture during a rear impact. The case was initially removed to the U.S. District Court for the Northern District of Oklahoma based on diversity jurisdiction after the Supreme Court dismissed the distributor and retailer for lack of personal jurisdiction.

After a jury trial that resulted in a verdict for the defendants, the plaintiffs sought a new trial, which was denied, prompting their appeal. The plaintiffs raised several alleged errors for consideration, particularly focusing on discovery abuses by the defendants. They claimed the defendants failed to comply with pretrial orders by not presenting their expert witness, Derwyn Severy, for deposition until twelve days into the trial, which hindered the plaintiffs' ability to counter the defendants' case during their presentation. Additionally, the plaintiffs contended that the defendants did not exchange exhibits prior to their introduction in court, further limiting the plaintiffs' capacity to prepare objections or rebuttal testimony, thus violating the principles of federal discovery rules aimed at ensuring fair trial processes.

Plaintiffs assert that the defendants' deliberate non-compliance with discovery rules warrants evidence exclusion and sanctions under Fed. R. Civ. P. 37(d). Defendants counter that plaintiffs cannot claim unfair surprise due to their own discovery violations and inability to prepare adequately for trial. They argue that any alleged prejudice to plaintiffs was mitigated by the trial court’s exclusion of some evidence and provision of additional time for review. The trial court has discretion in imposing sanctions and making evidentiary decisions, which includes evaluating discovery abuses and ensuring a fair trial.

The court acknowledges that while it cannot resolve the accusations between the parties regarding discovery practices, it finds error in allowing defendants to delay presenting an expert witness until after trial commenced. However, it concludes that the trial court's refusal to exclude evidence or impose sanctions does not constitute reversible error.

Regarding the admissibility of a film depicting rear-end collisions, plaintiffs object to its introduction, claiming it features dissimilar vehicles (1973 models versus a 1976 Audi) and conditions not reflective of their accident. They argue that the film's admission was prejudicial and that the defendants' expert should not have referenced it. Defendants maintain that the film was not intended to recreate the specific accident but to illustrate general principles of physics related to rear-end collisions. The court notes previous cases that have addressed similar evidentiary issues.

The admissibility of filmed experiments in court is contingent upon demonstrating that the experiments were conducted under conditions similar to those of the incident in question. While demonstrations meant to illustrate expert opinions do not need strict factual adherence, it must be communicated to the jury that such information is for theoretical purposes only. When using visual aids like photographs or films, they should be representative and not misleading to avoid jury confusion. In the case of "Cars That Crash and Burn," the defendants acknowledged that the film did not recreate the plaintiffs' accident but was used to illustrate the effects of rear-end collisions on different gas tank configurations. Expert Derwyn Severy provided explanations of the damage and ignition principles related to the tests. Although the trial court should have given clear instructions regarding the limited use of the film, the plaintiffs did not request such an instruction, thereby waiving their objection. Ultimately, no prejudice was suffered as Severy's testimony clarified the differences between the filmed collisions and the plaintiffs' incident. The film was relevant for illustrating certain principles but did not recreate the accident, and thus the lack of limiting instruction did not warrant reversal due to other supporting evidence presented.

Prejudice to the plaintiffs from the acceptance of foreign transactions was not evident. The trial court allowed defendants to present "state-of-the-art" evidence regarding fuel tank design, which the plaintiffs argued was irrelevant to the strict products liability claim unless it was necessary to demonstrate feasible alternatives. The plaintiffs contended that such evidence could confuse the jury, as they believed they had already established ample evidence of alternative design considerations. 

Defendants countered that industry custom and practice are relevant to consumer expectations, aiding in the assessment of whether the product was "defective" and "unreasonably dangerous." The plaintiffs had introduced state-of-the-art evidence themselves, thus allowing the defendants to respond with similar evidence. Previous case law supports the idea that while state-of-the-art evidence has limited utility in products liability cases, it can inform the ordinary consumer's expectations and the feasibility of alternatives. 

Additionally, the plaintiffs challenged the jury instructions, claiming they conflated strict liability with negligence, leading to confusion regarding the product's "unreasonably dangerous" standard. They argued that the instructions improperly emphasized the manufacturer's conduct over the product itself, resulting in a verdict that potentially deviated from legal standards.

The court evaluates jury instructions by considering the overall understanding and guidance provided to the jury, rather than insisting on perfection in every detail. It assesses whether the jury was misled and if they grasped the pertinent issues and their responsibilities. Lengthy instructions alone do not warrant a reversal. 

The court next addresses the exclusion of plaintiffs' exhibits, which allegedly contained admissions by defendants regarding the dangerous design of the fuel tank. Plaintiffs assert that Volkswagen of America was aware of the risks associated with the Audi model's fuel tank placement as early as 1967 and that this knowledge should be imputed to Audi, given Volkswagen's agency relationship with Audi beginning in 1974. Plaintiffs believe these documents are admissible under Federal Rule of Evidence 801(d)(2) as party admissions.

Defendants contend that the documents are not admissions since they were submitted by Volkswagen of America as an agent for a non-party German company, Volkswagenwerk Aktiengesellschaft. They argue that the documents cannot bind Audi since Volkswagen of America was not Audi's agent until 1974. Additionally, defendants maintain that the documents do not contradict their position and are inadmissible hearsay. They argue that even if the evidence were relevant, it pertains only to punitive damages, which plaintiffs cannot recover due to a lack of actual damages.

The trial court excluded the evidence on several grounds: it found the statements were not admissions, not attributable to Audi, and irrelevant to the case against Volkswagen of America. However, the reviewing court disagrees with the trial court's findings regarding the attribution of the statements to Audi, concluding that the documents clearly represent Volkswagen of America's responses on behalf of Volkswagenwerk Aktiengesellschaft and do not constitute responses from Audi, given the timing of the agency relationship.

Documents presented as evidence may be considered admissions under Federal Rules of Evidence 801(d)(2), but they are not considered admissions by Audi because the agency relationship with Volkswagen of America did not exist at the time the statements were made. Consequently, these statements are inadmissible hearsay against Audi. However, the statements are attributable to Volkswagen of America, as they were submitted without indication of acting solely as an agent for Volkswagen Aktiengesellschaft. If deemed relevant, these statements would be admissible as Volkswagen of America's own statements.

The trial court ruled that Volkswagen of America's statements were not admissions and found their knowledge of the defect irrelevant since Volkswagen of America did not design the Audi. This interpretation was contested. Under Oklahoma law, the lack of design or manufacturing by Volkswagen of America does not exempt it from liability in a product liability claim. The Oklahoma Supreme Court's precedent in Kirkland v. General Motors Corp. establishes that a manufacturer’s products liability includes proving that a defect existed when the product left the manufacturer’s control, rendering it unreasonably dangerous.

In Oklahoma, the definition of a "manufacturer" for liability includes sellers and distributors, meaning Volkswagen of America, as a seller, can be held to the same evidentiary standards regarding alleged defects. Therefore, the trial court's conclusion that Volkswagen of America's knowledge of the defect was irrelevant was incorrect.

In Oklahoma products liability cases, plaintiffs are not required to prove that sellers knew of defects at the time of sale, but prior knowledge of defects is relevant to determining if a product was unreasonably dangerous, and such evidence is admissible in court.

Evidence of prior accidents with similar circumstances is admissible under strict liability to establish notice, existence of a defect, or counter defense claims regarding product safety. In the case at hand, defendants contended that the Audi gas tank was not defective or dangerous and denied prior knowledge of any alleged defects in response to punitive damages claims. However, Volkswagen of America's submissions to the NHTSA indicated awareness of risks associated with the gas tank placement, which could be considered admissions against interest under Federal Rule of Evidence 801(d)(2).

A 1968 document from Volkswagen acknowledged that the puncture resistance of the fuel tank was a concern if located in the trunk, contradicting their trial defense that the tank was not susceptible to puncture in rear-end collisions. This statement conflicted with expert opinions presented by defendants, leading to an erroneous exclusion of crucial evidence. The trial court's decision to exclude these admissions was prejudicial to plaintiffs, as they were relevant to both the strict liability claim and the punitive damages claim. Although plaintiffs failed to prove actual damages and thus were not entitled to punitive damages, the exclusion of Volkswagen's prior knowledge was significant for the strict liability claim.

Consequently, the judgment against Volkswagen of America is reversed, and a new trial is ordered, allowing the jury to consider Volkswagen's prior knowledge of risks associated with the drop-in fuel tank design and related evidence.