The opinion of the court was delivered by: BY THE COURT; HERBERT J. HUTTON
I. FACTS AND PROCEDURAL HISTORY
On September 16, 1992, this Court denied in part and granted in part defendants' Motion for Summary Judgment.
The defendants now ask this Court to reconsider its decision on the strict liability claim. Specifically, this Court must decide whether, under Pennsylvania law, the "product line exception" for corporate liability applies when the plaintiff cannot demonstrate that the actual transfer of assets between the transferor and acquiring corporation destroyed the cause of action against the original manufacturer. Upon reconsideration of the case law, this Court reaffirms its earlier decision that the "causal element" is not a prerequisite to sustaining a cause of action against a previous product manufacturer under Pennsylvania's "product line exception."
This Court begins its discussion with an acknowledgment that this is a question of state law that has bedeviled federal district courts before, and will continue to do so until the Pennsylvania Supreme Court makes a pronouncement on the "causal element." See Tracey by Tracey v. Winchester Repeating Arms Co., 745 F. Supp. 1099 (E.D. Pa. 1990), aff'd without opinion, 928 F.2d 397 (3d Cir. 1991); Olejar v. Powermatic, et al., Slip Op. No. 92-CV-0150 (E.D. Pa. Sept. 16, 1992).
As this Court stated in its earlier opinion discussing summary judgment:
when this Court sits in diversity, it must apply the substantive law of the forum in which it is located. Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78, 82 L. Ed. 1188, 58 S. Ct. 817 (1938). The federal courts are to follow the decision of the Supreme Court of the state where the state's high court has spoken. In addition, "an intermediate appellate state court . . . is a datum for ascertaining state law which is not to be disregarded by a federal court unless it is convinced by other persuasive data that the highest court of the state would decide otherwise. Commissioner v. Estate of Bosch, 387 U.S. 456, 465, 87 S. Ct. 1776, 18 L. Ed. 2d 886 (1967).
Slip Op. at 5-6. "Determining what is Pennsylvania's law" becomes the defining question in this Motion to Reconsider, a question that is particularly complicated because there is no Supreme Court holding on point. The absence of the Pennsylvania Supreme Court's view on this subject is further complicated by two additional issues. First, each of the federal courts that have addressed the "corporate successor liability doctrine" since 1985 have predicated their opinions on the assumption that the Pennsylvania Supreme Court would, if asked, adopt the product line exception. See e.g., Conway v. White Trucks, A Div. of White Motor. Co., 885 F.2d 90, 95 (3d Cir. 1989) ("For purposes of our decision we will assume arguendo that Pennsylvania would follow the Dawejko decision.") (referring to Dawejko v. Jorgensen Steel Co., 290 Pa. Super. 15, 434 A.2d 106-07 (Pa. Super. Ct. 1981)(adopting product line exception).
These assumptions have placed the federal courts in the uncomfortable position of predicting state law without any definitive direction from the state Supreme Court. See Estate of Bosch, 387 U.S. at 465. This discomfort is further compounded by the fact that only three states, Pennsylvania, New Jersey and California have embraced the product line exception for successor corporations. Hill v. Trailmobile, Inc., 412 Pa. Super. 320, 603 A.2d 602 (Pa. Super. Ct. 1992). See Third Circuit Chief Judge Dolores Sloviter, Diversity Jurisdiction Through the Lens of Federalism, The American Judicature Society, Westlaw Lawprac Index, n.39-40 (August/September 1992) ("Erie guesses" most difficult area of diversity jurisdiction after weighing federalism concerns); Craig A. Hoover, Note, Deference to Federal Circuit Court Interpretations of Unsettled State Law: 1982 Duke L.J. 704.
The second issue that complicates this Court's decision is that when the Third Circuit sat as the Supreme Court of the Virgin Islands, it expressly rejected the product line exception. Polius v. Clark Equipment Co., 802 F.2d 75 (3d Cir. 1986). In short, there is a conflict between the Third Circuit's disapproval of the product line exception and the substantive choice of law Pennsylvania has made in its own state court system. Compare, Polius, 802 F.2d at 82 ("sounder choice is to reject product line doctrine where court had right to choose") with Hill v. Trailmobile, Inc., 412 Pa. Super. 320, 603 A.2d 602, 606 (Pa. Super. Ct. 1992) (product line doctrine the law of Pennsylvania).
Accordingly, this Court must, without either Pennsylvania Supreme Court or Third Circuit precedent on point, decide whether the "causal requirement" is a prerequisite to sustaining a cause of action against a corporate successor under Pennsylvania law.
1. Standard for a Motion to Reconsider
Federal Rule of Civil Procedure 60(b) provides in relevant part:
Relief From Judgment or Order
(b) Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud, etc.
On motion and upon such terms as are just, the court may relieve a party or a party's legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect,
The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than one year after the judgment, order ...