Dow Chemical Co. v. Ebling

ATTORNEYS FOR APPELLANT DOW CHEMICAL CO. ATTORNEYS FOR

APPELLEES

Stanley C. Fickle Richard Mullineaux Roger

L. Pardieck

Robert D. MacGill KIGHTLINGER & GRAY, LLP Karen M.

Davis

Dean T. Barnhard New Albany, Indiana PARDIECK &

GILL

Joseph G. Eaton Seymour, Indiana

William E. Padgett Janet Barbre Norton

BARNES & THORNBURG DOW AGROSCIENCES LLC John Vargo

Indianapolis, Indiana Indianapolis, Indiana Janet O.

Vargo

PARDIECK & GILL

ATTORNEY FOR APPELLANT AFFORDABLE PEST CONTROL Carmel, Indiana

Gene F. Zipperle, Jr.

CRAFTON, MARTIN & ZIPPERLE

Louisville, Kentucky

ATTORNEYS FOR APPELLANT LOUISVILLE CHEMICAL CO.

John W. Bilby

Henry S. Alford

MIDDLETON & REUTLINGER

Jeffersonville, Indiana

In The

INDIANA SUPREME COURT

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. ) Supreme Court No.

Appellant-Defendant ) 22S05-0008-CV-481

)

AFFORDABLE PEST CONTROL, INC. )

Appellant-Defendant )

)

v. )

)

TODD EBLING and Cynthia Ebling, ) Court of Appeals No.

individually and as Husband and Wife, ) 22A05-9812-CV-625

and as Parents of CHRISTINA EBLING )

and ALEX EBLING )

Appellees-Plaintiffs )

________________________________________________

INTERLOCUTORY APPEAL FROM THE FLOYD SUPERIOR COURT

The Honorable Richard G. Striegel, Judge

Trial Court Cause No. 22D01-9601-CT-30

________________________________________________

On Petition to Transfer

August 23, 2001

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.

Ebeling, 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

plaintiff's 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. ---, 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 ---, 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 (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 (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

(2000)." Lorillard Tobacco Co. v. Reilly, 533 U.S. ---, 121 S.Ct. 2404,

2414, --- L.Ed.2d ---, --- (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.Ed2d 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, --- L.Ed.2d at ---

. Both the language of the preemption statute and the statutory framework

surrounding it provide the primary basis for determining Congress' 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 predecessor, FIFRA as originally adopted

"was primarily a licensing and labeling statute." Ruckelshaus v.

Monsanto Co., 467 U.S. 986, 991 (1984). In 1972, growing environmental

and safety concerns led Congress to undertake a comprehensive revision

of FIFRA through the Federal Environmental Pesticide Control Act. 86

Stat. 973. The 1972 amendments significantly strengthened FIFRA's

registration and labeling standards. 7 U.S.C. [§]136a. To help make

certain that pesticides would be applied in accordance with these

standards, the revisions further insured that FIFRA "regulated the

use, as well as the sale and labeling, of pesticides; regulated

pesticides produced and sold in both intrastate and interstate

commerce; [and] provided for review, cancellation, and suspension of

registration." Ruckelshaus, supra, at 991-992. An additional change

was the grant of increased enforcement authority to the Environmental

Protection Agency (EPA), which had been charged with federal oversight

of pesticides since 1970. See Reorganization Plan No. 3 of 1970, 35

Fed.Reg. 15623 (1970), 5 U.S.C. App. p. 1343. In this fashion, the

1972 amendments "transformed FIFRA from a labeling law into a

comprehensive regulatory statute." 467 U.S. at 991.

Mortier, 501 U.S. at 601, 111 S.Ct. at 2480, 115 L.Ed.2d at 540. In regard

to labeling, FIFRA, in an attempt to ensure some uniformity, contains an

explicit preemption provision that prevents a state from "impos[ing] or

continu[ing] in effect any requirements for labeling or packaging in

addition to or different from those required under this Act [7 U.S.C. §§

136 et seq.]." 7 U.S.C. § 136v(b). As an initial matter, we note

agreement among a majority of jurisdictions that the phrase "any

requirements" in this provision is sufficiently expansive to include both

positive enactments of state law-making bodies and common law duties

enforced in actions for damages.[4]

FIFRA requires all pesticides sold or distributed to be registered

with the Environmental Protection Agency (EPA). 7 U.S.C. § 136a(a). To

register a pesticide, the manufacturer must file information including a

copy of the label, complete formula, directions for use, the purpose of the

pesticide, and, upon request, test descriptions and results. 7 U.S.C. §

136a(c). Then the EPA Administrator shall register the pesticide if the

proper requirements are met, which include an approval of the proposed

label.[5] 7 U.S.C. § 136a(c)(5). FIFRA prohibits the sale or distribution

of pesticides that are misbranded. 7 U.S.C. § 136j(a)(1)(F). A pesticide

with a deficient label is misbranded. See 7 U.S.C. § 136(q). While FIFRA

requires pesticide manufacturers to affix an approved label to their

product in order to sell it, applicators, either commercial or private, are

not required to label anything but, as with members of the general public,

applicators are prohibited from detaching, altering, defacing or destroying

the label affixed to the pesticide by the manufacturer. 7 U.S.C. §

136j(2). The law is fairly settled that when a pesticide manufacturer

"places EPA-approved warnings on the label and packaging of its products,

its duty to warn is satisfied, and the adequate warning issue ends." Papas

v. Upjohn Co., 985 F.2d 516, 519 (11th Cir. 1993). Because of the absence

of an affirmative FIFRA labeling requirement for applicators, however, we

find that the alleged state tort law duty imposed upon applicators to

convey the information in the EPA-approved warnings to persons placed at

risk does not constitute a requirement additional to or different from

those imposed by FIFRA.

We acknowledge that some courts, as cited by Affordable, have

concluded generally that duty to warn claims against applicators are

preempted by FIFRA. See, e.g., Hottinger v. Trugreen Corp., 665 N.E.2d 593

(Ind. Ct. App. 1996), trans. denied; Wadlington v. Miles, Inc., 922 S.W.2d

520 (Tenn. Ct. App. 1995), appeal denied; Bingham v. Terminix, 896 F.Supp.

642 (S.D. Miss. 1995). Because these cases do not specifically consider

the distinctions between pesticide manufacturers and applicators, we

conclude that their findings of preemption are not persuasive as to the

present claims against Affordable. This result is consistent with the

United States Supreme Court's finding in Mortier of no FIFRA preemption of

a local ordinance requiring an applicator of pesticides to notify and

inform persons who might come into contact with the pesticide after

application. 501 U.S. at 606, 111 S.Ct. at 2487, 115 L.Ed.2d at 550.

We also conclude that the plaintiffs' duty to warn claims against

Affordable are not subject to field preemption by implication from the

depth and breadth of the statutory scheme. FIFRA specifically provides for

regulation of pesticides by states, 7 U.S.C. § 136v(a), and the United

States Supreme Court held in Mortier that FIFRA "leaves ample room for

States and localities to supplement federal efforts even absent the express

regulatory authorization of 136v(a).[6]" 501 U.S. at 613, 111 S.Ct. at

2486, 115 L.Ed.2d at 549. As noted above, in Mortier the United States

Supreme Court 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 is 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.Ed2d at 550. From Mortier, we discern that, like a state or local

regulatory scheme that requires permits and notice to the non-user

consumer/bystander and imposes penalties, the imposition of a duty to warn

on applicators is not preempted by FIFRA.

We finally consider whether permitting a state tort claim based on

Affordable's alleged failure to communicate label information to persons

placed at risk frustrates the purpose of FIFRA or renders compliance with

both state and federal law impossible, thereby favoring preemption under

the principles of Geier and Lorillard. The Court in Mortier, in finding no

actual conflict between FIFRA and a local use ordinance, stated: "[L]ocal

use permit regulations – unlike labeling or certification – do not fall

within an area that FIFRA’s ‘program’ preempts or even plainly addresses."

Id. at 615, 111 S.Ct. at 2487, 115 L.Ed.2d at 549. Rather than conflicting

with or frustrating the purposes of FIFRA, the opposite is true. The

plaintiffs' claim that Affordable should have communicated the label

information is entirely consistent with the objectives of FIFRA. The use

of state tort law to further the dissemination of label information to

persons at risk clearly facilitates rather than frustrates the objectives

of FIFRA and does not burden Affordable's compliance with FIFRA.

We hold that FIFRA preemption does not apply to preclude the

plaintiffs' action against Affordable for its failure to warn the

plaintiffs by providing them with the FDA-approved label warning

information. The trial court is affirmed in its denial of summary judgment

to Affordable on preemption. In all other respects, the opinion of the

Court of Appeals is summarily affirmed, and this cause is remanded to the

trial court for further proceedings accordingly.

SHEPARD, C.J., and SULLIVAN, BOEHM, and RUCKER, JJ., concur.

-----------------------

[1] 7 U.S.C. §§ 136 et seq.

[2] Former Ind.Appellate Rule 11(B)(3). Because this appeal was

initiated before the effective date of the new rules, January 1, 2001, the

former rule applies. This rule is now Rule 58(A).

[3] Although finding FIFRA preemption applicable to some of

Hottinger's claims, the court held that erroneous exclusion of expert

opinion evidence required reversal of the summary judgment as to the

remaining claims. Transfer to this Court was sought only by appellee

Trugreen, whose petition to transfer was denied. To the extent that

Hottinger v. Trugreen Corp. is inconsistent with our opinion herein, it is

overruled.

[4] This conclusion derives from the analogous language found in the

cigarette labeling act construed to include both positive and common law in

Cipollone v. Liggett Group, Inc., 505 U.S. 504, 112 S.Ct. 2608, 120 L.Ed.2d

407 (1992). A majority of jurisdictions have found "any requirements"

includes common law actions. See, e.g., Andrus v. Agrevo USA Co., 178 F.3d

395, 398 (5th Cir. 1999); Kuiper v. American Cyanamid Co., 131 F.3d 656,

662 (7th Cir. 1997); Grenier v. Vermont Log Buildings, Inc., 96 F.3d 559,

563 (1st Cir. 1996); Taylor AG Industries v. Pure-Gro, 54 F.3d 555, 559

(9th Cir. 1995); Etcheverry v. Tri-Ag Service, Inc., 993 P.2d 366, 367-376

(Cal. 2000); Banks v. ICI Americas, Inc., 450 S.E.2d 671, 676 (Ga. 1994);

Schuver v. E.I. du Pont de Nemours & Co., 546 N.W.2d 610, 613 (Iowa 1996);

Jenkins v. Amchem Produxts, Inc., 886 P.2d 869, 880 (Kan. 1994); Hopkins v.

American Cyanamid Co., 666 So.2d 615, 622 (La. 1996); Hochberg v. Zoecon

Corp., 657 N.E.2d 1263, 1266 (Mass. 1995); Ackles v. Luttrell, 561 N.W.2d

573, 576-80 (Neb. 1997); Lewis v. American Cyanamid Co., 715 A.2d 967, 973

(N.J. 1998); Wadlington v. Miles, Inc., 922 S.W.2d 520, 524 (Tenn. Ct. App.

1995); Eide v. E.I. du Pont de Nemours & Co., 542 N.W. 2d 769, 771-72 (S.D.

1996); Quest Chem. Corp. v. Elam, 898 S.W.2d 819, 820 (Tex. 1995); Hue v.

Farmboy Spray Co., 896 P.2d 682, 691 (Wash. 1995); Gorton v. American

Cyanamid Co., 533 N.W.2d 746, 753 (Wis. 1995). But see, Kimmel, Inc. v.

Dowelanco, --- F.3d --- , 2001 WL 766275 (9th Cir. 2001)(suggesting that

due to recent developments court may revisit meaning of "requirements");

Sleath v. West Mont Home Health Services, Inc., 16 P.3d 1042, 1053 (Mont.

2000)(holding common law causes of action based on failure to warn not

preempted because preemption provision in FIFRA only applies to positive

law); Brown v. Chas. H. Lilly Co., 985 P.2d 846, 853 (Or. Ct. App.

1999)(finding no congressional intent to preempt through FIFRA common law

claims).

[5] The labeling must conform to federal rules concerning type, size,

and placement on the product package. See generally 40 C.F.R. § 156

(2000).

[6] 7 U.S.C. §136v(a) states: "A State may regulate the sale or use

of any federally registered pesticide or device in the State, but only if

and to the extent the regulation does not permit any sale or use prohibited

by this Act [7 U.S.C. §§ 136 et seq.]."