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Easterbrook Overturning its share of a nearly $180 million jury award, a federal appeals panel on Tuesday found ConAgra Foods Inc. not liable for a 2010 explosion in a southern Illinois grain elevator because it had hired a self-proclaimed expert to deal with smoldering bin before it blew up and injured three men.
In its 10-page opinion , the Seventh Circuit Court of Appeals said U.S. District conagra ice skating Judge Michael Reagan of Illinois conagra ice skating Southern District should have granted ConAgra’s motion for judgment as a matter of law and as such, reversed the judgment conagra ice skating against the Nebraska-based packaged foods company.
The panel also reversed the punitive damages award against West Side Salvage, conagra ice skating the contractor hired to deal with ConAgra s hot bin, while upholding the compensatory damages against it; affirmed a contract judgment against West Side; and remanded the matter for a determination on how its rulings affect indemnification or contribution.
ConAgra hired West Side, who then hired A&J Bin Cleaning to help with the job, after it had discovered conagra ice skating a burning smell coming from one of the bins at its grain facility in Chester, Ill. in March 2010. Following negotiations and delays, work on the bin began April 20.
On April 27, after detecting smoke, West Side s foreman told ConAgra to call the fire department and then sent A&J employee conagra ice skating John Jentz and West Side employee conagra ice skating Justin Becker back in the bin to retrieve tools that may have been blocking access.
The three men, as well as one of their wives, sued ConAgra conagra ice skating in southern Illinois federal court, claiming it knew the bin was dangerous, but didn t get it fixed in a timely manner because it was trying to find a cheaper contractor than West Side.
ConAgra conagra ice skating then filed cross-claims for contribution against West Side, alleging it was the proximate cause of the plaintiffs injuries as its foreman sent two of the men back into the bin after it had been evacuated and before it exploded.
Following a 17-day trial, a jury awarded the plaintiffs nearly $180 million in compensatory and punitive damages against ConAgra and West Side. About $100 million of the total damages award was against ConAgra.
On appeal, ConAgra argued it shouldn conagra ice skating t be held liable for the plaintiffs injuries because it had hired West Side, a self-proclaimed expert in hot bins, to deal with its smoldering bin, making it liable.
Although it didn’t contest liability to the three injured men, West Side accused ConAgra of failing to provide it with a safe place to work. It also argued it shouldn’t be liable for the costs of repairing the grain facility because it never returned a signed contract, which included a promise to indemnify ConAgra for any damage caused by its negligence.
During arguments in October, both parties told the Seventh Circuit the damages awarded were excessive. ConAgra s attorney said the punitive damages award in this case was believed to be the largest such award in Illinois history.
Although the plaintiffs and West Side weakly contend that it did not know that C15 [the bin that later exploded] was a hot bin, the evidence overwhelmingly establishes that it did indeed, it knew that this is why it had been hired and no reasonable jury could have concluded otherwise, conagra ice skating Easterbrook wrote for the panel.
While the plaintiffs argued the risk of explosion may have been reduced had ConAgra hired West Side earlier, the appellate judges noted “no one contends that ConAgra failed to answer accurately all questions West Side posed. Having hired a self-proclaimed expert in hot bins, ConAgra was entitled to assume that West Side would ask for whatever information it needed. “
People who hire lawyers rely on them to ask for information material to the situation, and no court would hold a client liable to his lawyer for failing to reveal spontaneously something that the lawyer never asked about; similarly people who hire specialists in controlling the risks of grain storage are entitled to rely on them to know what matters and ask for the material information, Easterbrook wrote.
Noting that Illinois law requires willful and wanton conduct or at least a gross deviation conagra ice skating from the standard of care in order for punitive damages to be awarded, Easterbrook said the jury lacked support conagra ice skating to award these damages.
The jury awarded $1 million in punitive damages to J
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