On Appeal from the United States District Court for the District of New Jersey. (D.C. Civil No. 88-00757).
Before: Sloviter, Chief Judge, Stapleton and Lay,*fn* Circuit Judges
Defendant Morbark Industries, Inc. has filed an interlocutory appeal certified pursuant to 28 U.S.C. § 1292(b). It challenges the district court's order requiring that it participate in a retrial of plaintiff's products liability claims despite the fact that it was found not liable by the jury at the first trial and was not a party to the appeal taken by its co-defendant.
Facts and Procedural History
This products liability action by plaintiff Daniel Repola against defendants Morbark Industries, Inc. ("Morbark Industries") and Morbark Pennsylvania, Inc. ("Morbark Pennsylvania"), respectively the manufacturer and distributor of a wood chipping machine, was originally filed in a New Jersey state court, removed by defendants based upon diversity jurisdiction, and tried in federal court in New Jersey.
At trial, two theories of liability were submitted to the jury: (1) whether Morbark Industries and Morbark Pennsylvania were strictly liable under the New Jersey Products Liability Act (NJPLA), N.J. Stat. Ann. § 2A:58C-1 to 58C-7 (West 1987), for manufacturing and distributing a defective product; and (2) whether Morbark Pennsylvania was liable for common law negligence for its failure to provide adequate start-up instructions. In response to special interrogatories the jury found that although the machine did not contain a design defect, it was defective because of defendants' failure to provide adequate warnings, but that the defendants' failure to provide adequate warnings was not a proximate cause of the accident. These findings resulted in a verdict in favor of both defendants on the NJPLA claim. The jury also found that because Morbark Pennsylvania failed to fulfill its dealership obligation to Morbark Industries to provide adequate start-up instructions to Repola, Morbark Pennsylvania was negligent at common law and its negligence in that regard was a proximate cause of the accident. The jury awarded Repola $747,279.10 on the common law negligence claim, less 30% for Repola's own negligence, resulting in a verdict of $523,095.37. Judgment was entered on the jury's verdict on December 4, 1989. Morbark Pennsylvania moved for judgment notwithstanding the verdict or, in the alternative, for a partial new trial. The district court denied the motion on February 20, 1990. Morbark Pennsylvania filed a notice of appeal, but Repola did not file a cross-appeal challenging the verdict in favor of Morbark Industries. On Morbark Pennsylvania's appeal, this court found that the common law negligence claim was improperly submitted to the jury because that claim was subsumed by the NJPLA. Repola v. Morbark Indus., Inc., 934 F.2d 483 (3d Cir. 1991) (Repola I). We held that the district court's error in submitting the negligence claim to the jury resulted in "inconsistent and utterly irreconcilable" verdicts, id. at 485, and therefore we reversed and remanded the case for a new trial on the NJPLA claim. Id. at 495.
Our opinion did not address the question whether Morbark Industries, which was not a party to the appeal, was included in the retrial order. On remand, the district court, after asking counsel to brief what issues and which parties should be part of the retrial, determined that "a retrial of all issues in light of the instructions of the Third Circuit is required." App. at 75-77. Ultimately, the district court certified its order to that effect as an interlocutory order pursuant to 28 U.S.C. § 1292(b) and this court granted Morbark Industries' petition for leave to appeal.
Morbark Industries contends that it cannot be compelled to participate in the retrial of Repola's claim against Morbark Pennsylvania because principles of res judicata or waiver preclude the retrial of the jury's finding of no liability for Morbark Industries, and because the district court misconstrued the mandate of this court's earlier opinion ordering a new trial.*fn1
Morbark Industries argues that Repola has no right to relief from the earlier judgment in Morbark Industries' favor because, as a general rule, without a cross-appeal an appellee may not "attack the decree with a view either to enlarging his own rights thereunder or lessening the rights of his adversary." Morley Constr. Co. v. Maryland Casualty Co., 300 U.S. 185, 191, 81 L. Ed. 593, 57 S. Ct. 325 (1937) (quoting United States v. American Ry. Express Co., 265 U.S. 425, 435, 68 L. Ed. 1087, 44 S. Ct. 560 (1924)); see New Castle Cty. v. Hartford Accident & Indem. Co., 933 F.2d 1162, 1205 (3d Cir. 1991); Airco Indus. Gases, Inc. v. Teamsters Health & Welfare Pension Fund, 850 F.2d 1028, 1034 (3d Cir. 1988); 9 Moore's Federal Practice P 204.11, at 4-45 (2d ed. 1992). That is, an appellee may not attempt to reverse a judgment unless review is sought "of the whole ...