The opinion of the court was delivered by: McCLURE, District Judge.
The question next becomes whether the Pennsylvania courts would
apply the heeding presumption in failure to warn cases in which
the plaintiff proceeds on a negligence theory instead of, or in
addition to, a strict products liability theory. We believe that
Fed.R.Civ.P. 14(a) (emphasis added). This rule allows a defendant
to seek indemnity, contribution, or reimbursement under some
other form of third party liability, from third parties who may
be liable for the plaintiff's injuries, jointly with or in place
of the defendant. Wandrey v.
McCarthy, 804 F. Supp. 1384, 1386 (D.Kan. 1992). Such a claim
does not accrue for purposes of a statute of limitations until
the third party plaintiff becomes obligated, either by judgment
or by settlement, to pay the original plaintiff. Id. at
Thus, while we disagree with Duck Head that the statute of
limitations is tolled by Shouey's minority, we find that the
applicable limitations period has not expired because the third
party claim has not accrued for purposes of the statute.
(B) Count III — Strict Products Liability
Zippo moves for summary judgment as to the strict products
liability claim based on Griggs v. BIC Corp., 981 F.2d 1429 (3d
Cir. 1992). Duck Head and Shouey respond by arguing that the case
is in error and not controlling. This argument raises sensitive
issues of a federal court's application of state law in diversity
cases and the responsibility of a district court to adhere to a
higher court's decisions.
When exercising jurisdiction premised on diversity of
citizenship, a federal district court applies the substantive law
of the state whose law governs the action. Erie R. Co. v.
Tompkins, 304 U.S. 64, 78-79, 58 S.Ct. 817, 82 L.Ed. 1188
(1938); Paolella v. Browning-Ferris, Inc., 158 F.3d 183, 189
(3d Cir. 1998). The federal court may not impose its view of what
the state law should be, but must apply existing state law as
interpreted by the state's highest court in an effort to
determine how the state court would decide the precise legal
issue before the federal court. Koppers Co., Inc. v. Aetna
Casualty and Surety Co., 98 F.3d 1440, 1445 (3d Cir. 1996). In
the absence of any precedent from the state's highest court, the
federal court must predict how the state court would decide the
issue. Polselli v. Nationwide Mutual Fire Insurance Co.,
126 F.3d 524, 528-529 n. 3 (3d Cir. 1997). When predicting how the
state's highest court would rule on the issue, the federal court
must look to decisions of any intermediate state appellate court,
other federal courts interpreting the law of the state, and other
state supreme courts that have decided the issue, as well as
analogous decisions, dicta, scholarly works, and any other
reliable data which would tend to show convincingly how the
state's highest court would rule. Paolella at 189; Koppers at
1445. Intermediate appellate court decisions are given
"substantial weight" in the absence of any indication that the
state's highest court would rule otherwise. Polselli at 529 n.
This case is not one in which we must determine how a decision
of the state's highest court would apply. See In re Abrams,
521 F.2d 1094, 1103 (3d Cir.) (controlling decision of New Jersey
Supreme Court could not be disregarded "with fealty to
consistency"), cert. denied, 423 U.S. 1038, 96 S.Ct. 574, 46
L.Ed.2d 413 (1975). Nor is this an instance in which the state
courts have been consistent in a particular holding, adhering to
an older decision of the state's highest court. See Seese v.
Volkswagenwerk A.G., 648 F.2d 833, 836-837 (3d Cir.) (North
Carolina courts consistent in rejecting § 402A, including recent
decisions of intermediate appellate courts, so that district
court erred in predicting that state supreme court would change
its mind and adopt § 402A), cert. denied, 454 U.S. 867, 102
S.Ct. 330, 70 L.Ed.2d 168 (1981). However, it must be remembered
that it is state law as it exists at the time of the decision of
the federal court that governs. Seese at 837 (considering
opinion of North Carolina Supreme Court issued during pendency of
appeal); Air Products & Chemicals, Inc. v. Hartford Accident and
Indemnity Co., 25 F.3d 177, 181-182 (3d Cir. 1994) (remanding
for reconsideration by district court in light of opinion of
Supreme Court of Pennsylvania issued during pendency of appeal).
Thus, it is the most recent pronouncements of state law that
govern the decision of the federal court exercising diversity
jurisdiction. See generally Sonfast Corp. v. York Int'l Corp.,
875 F. Supp. 1088, 1094 (M.D.Pa. 1994) (when state law
undeclared or not current, federal court must discern most
probable state of current law so that outcome in federal court is
substantially the same as it would be in state court), judgment
aff'd, 74 F.3d 1227 (3d Cir. 1995) (table).*fn6
The problem here is the use of the term "unreasonably
dangerous" as it applies in cases under § 402A. To present the
problem as clearly as possible, we quote the section in its
§ 402A. Special Liability of Seller of Product for
Physical Harm to User or Consumer
(1) One who sells any product in a defective
condition unreasonably dangerous to the user or
consumer or to his property is subject to liability
for physical harm thereby caused to the ultimate user
or consumer, or to his property, if
(a) the seller is engaged in the business of
selling such a product, and
(b) it is expected to and does reach the user or
consumer without substantial change in the condition
in which it is sold.
(2) The rule stated in Subsection (1) applies
(a) the seller has exercised all possible care in
the preparation and sale of his product, and
(b) the user or consumer has not bought the product
from or entered into any contractual relation with
RESTATEMENT (SECOND) OF TORTS, § 402A (1965) (emphasis added).
This section was adopted as the law of Pennsylvania in Webb v.
Zern, 422 Pa. 424, 220 A.2d 853 (1966). The Supreme Court of
Pennsylvania later decided that the question of whether a product
is "unreasonably dangerous" is a matter for the court:
Thus the mere fact that we have approved Section
402A, and even if we agree that the phrase
"unreasonably dangerous" serves a useful purpose in
predicting liability in this area, it does not follow
that this language should be used in framing the
issue for the jury's consideration. Should an
ill-conceived design which exposes the user to the
risk of harm entitle one injured by the product to
recover? Should adequate warnings of the dangerous
propensities of an article insulate one who suffers
injuries from those propensities? When does the
utility of a product outweigh the unavoidability of
the danger it may pose? These are questions of law
and their resolution depends upon social policy.
Restated, the phrases "defective condition" and
"unreasonably dangerous" as used in the Restatement
formulation are terms of art invoked when
strict liability is appropriate. It is a judicial
function to decide whether, under the plaintiff's
averment of the facts, recovery would be justified;
and only after this judicial determination is made is
the cause submitted to the jury to determine whether
the facts of the case support the averments of the
complaint. They do not fall within the orbit of a
factual dispute which is properly assigned to the
jury for resolution.
Azzarello v. Black Bros. Co., Inc., 480 Pa. 547, 558,
391 A.2d 1020, 1026 (1978) (emphasis in original). To distinguish a
"defective condition" from an "unreasonably dangerous" product
for these purposes, the Court added:
For the term guarantor to have any meaning in this
context the supplier must at least provide a product
which is designed to make it safe for its intended
use. Under this standard, in this type of case, the
jury may find a defect where the product left the
supplier's control lacking any element necessary to
make it safe for its intended use or possessing any
feature that renders it unsafe for the intended use.
It is clear that the term "unreasonably dangerous"
has no place in the instructions to a jury as to the
question of "defect" in this type of case.
Id. at 559, 391 A.2d 1020, (footnotes omitted). See also Pa.
Suggested Standard Jury Instructions (Civil) § 8.02 (using
similar language to define "defect").
The upshot of Azzarello is that consideration of whether a
defendant will be held liable as a seller or manufacturer of a
defective product becomes a two-step process. First, the court
determines whether, given the facts as alleged by the plaintiff,
the defendant should be subject to strict liability. Second, the
jury determines whether the product lacks any element necessary
to make it safe for its intended use. In essence, using the terms
of art, the court determines whether the product is "unreasonably
dangerous" and the jury determines whether the product is
"defective." The question of how the court is to perform its part
of this analysis was left to another day.
The question was addressed tangentially in Lewis v. Coffing
Hoist Div., Duff-Norton Co., Inc., 515 Pa. 334, 528 A.2d 590
(1987), in which the Supreme Court of Pennsylvania held that
evidence of industry standards was inadmissible in a case under §
402A because it is the product, and not the manufacturer's
conduct relative to the product, which is on trial. In so
holding, the Court pointed out that Azzarello stands for the
proposition (at least by implication) that negligence concepts
are not to be injected into strict products liability actions.
Lewis at 341, 528 A.2d at 593. From Lewis, then, it becomes
clear that any conduct of the defendant which must be considered
is part of the court's social policy analysis under Azzarello
because presenting evidence of such to the jury would be to
introduce negligence concepts to the jury.
The Court of Appeals for the Third Circuit applied Azzarello
in Griggs v. BIC Corp., 981 F.2d 1429 (3d Cir. 1992), a case
involving a child playing with a disposable butane cigarette
lighter. The Third Circuit noted first that the test to be
applied was whether the product was safe for its intended use, a
concept which "impliedly encompasses the participation of an
intended user." Id. at 1433. The court specifically
distinguished intended use from foreseeable use or expected use,
and concluded that the latter two concepts play no part in strict
liability. Id. at 1433 n. 7. Summarizing its view of cases
cited by the plaintiffs, the Third Circuit concluded, "None of
them supports the contention that in Pennsylvania a manufacturer
has a duty in strict liability law to guard against foreseeable
use by unintended users in the context of the initial
determination of defect." Id. at 1434. Despite using language
suggesting that its analysis was under the "defective condition"
test, the Third Circuit then added an indication that its
analysis was under the "unreasonably
dangerous" test by stating, "Because the plaintiffs do not
contend that the lighter was unsafe for its intended use, the
trial court committed no error in holding that the lighter was
not defective and that BIC as a matter of law should not bear
the risk of loss." Id. (emphasis added). Compare Azzarello
at 1026 (quoted above; court considering legal question of
whether product is "unreasonably dangerous" determines whether
recovery is justified).
The problem inherent in Griggs is reflected in Pacheco v.
Coats Co., Inc., 26 F.3d 418, 421-422 (3d Cir. 1994), reh'g,
reh'g in banc denied. Relying on Azzarello, Lewis, and
Griggs, the Third Circuit termed the initial test as one of
risk allocation, adding, "A judicial determination that
Pennsylvania social policy allocates the risk away from the
manufacturer in a strict product liability case is tantamount to
a judicial conclusion that the product is not defective." Id.
at 422. Although examining the question of whether the user is an
intended user in the context of whether the product is defective,
the Third Circuit noted that foreseeability is a negligence
concept with no place in strict liability law. Id.
In a later opinion, the Third Circuit attempted to distinguish
more clearly what is meant by "unreasonably dangerous" and
"defective condition" for purposes of claims under § 402A as
applied under Pennsylvania law. Surace v. Caterpillar, Inc.,
111 F.3d 1039 (3d Cir. 1997). In so doing, the Third Circuit
concentrated on what it referred to as the "Azzarello
standard," id. at 1044, by which it meant the threshold
"unreasonably dangerous" or social policy determination. This
terminology reflects what appears to be a tendency among courts
and litigators to refer to the "unreasonably dangerous"
determination as the "Azzarello test" and the "defective
condition" determination as the "Lewis test." See Surace at
1045 (citing Lewis as standing for "intended use" approach in
defining design defect, as opposed to risk-utility approach).
Hereafter, we use the same language.
The Third Circuit clearly delineated the two tests, concluding
that a risk-utility analysis is the appropriate standard for the
Azzarello test and that the Supreme Court of Pennsylvania would
adopt such an approach. Surace at 1044-1045. It noted that the
cases in which a risk-utility analysis was rejected were those in
which courts were considering such a standard in the context of
defining "defect," i.e. the Lewis test. Surace at 1045. Of
course, at this point, Griggs reared its head. The Third
Circuit addressed its prior opinion, as well as the district
court opinion, as follows:
In Griggs v. BIC Corp., 786 F. Supp. 1203 (M.D.Pa.
1992), the plaintiffs sought to have strict liability
imposed, not because the product, a disposable butane
lighter, was unsafe for its intended use, but because
it was unreasonably dangerous to foreseeable users,
i.e., children. The plaintiffs advocated use of the
risk-utility approach to design defect, rather than
the "intended use" approach, arguing that because it
was foreseeable that children would misuse the
lighter and it was feasible to design child-proof
lighters, on balance, the product was defective. The
district court, citing Hite [v. R.J. Reynolds
Tobacco Co., 396 Pa. Super. 82, 578 A.2d 417 (1990),
allocatur denied, 527 Pa. 666, 593 A.2d 842 (1991)
(table),] and Dauphin [Deposit Bank & Trust Co. v.
Toyota Motor Corp., 408 Pa. Super. 256, 596 A.2d 845
(1991)], noted that the Pennsylvania courts have
rejected the risk-utility approach to design defect
cases. Id. at 1206-07. The court, however,
correctly distinguished between the use of
risk-utility as an approach to defining defect and as
a method for evaluating a product's `unreasonable
dangerousness' under the rubric of strict products
liability. Id. at 1207 n. 4.
On appeal, a panel of this Court relied on the
Supreme Court's decision in Lewis in affirming the
district court on this
issue. Griggs v. BIC Corp., 981 F.2d 1429, 1433 n.
6 (3d Cir. 1992). In light of the underlying facts of
the case, we read the panel's decision in Griggs as
rejecting the argument that the risk-utility approach
to defining defect should be used instead of the
"intended use" approach; however, to the extent that
the panel's decision can be read as rejecting
outright the use of a risk-utility analysis as a part
of the threshold determination, it is contrary to our
decision in Motter [v. Everest & Jennings, Inc.,
883 F.2d 1223 (3d Cir. 1989), reh'g denied], which,
subsequent to the Lewis decision, sanctioned this
approach, and, therefore, carries no precedential
weight. See O. Hommel Co. v. Ferro, 659 F.2d 340,
354 (3d Cir. 1981) ("[A] panel of this court cannot
overrule a prior panel precedent. . . . To the extent
that [the later case] is inconsistent with [the
earlier case, the later case] must be deemed without
effect." (citation omitted)) [, cert. denied,
455 U.S. 1017, 102 S.Ct. 1711, 72 L.Ed.2d 134 (1982)].
Surace at 1045-1046 n. 6 (emphasis added; bracketed citations
added, remaining bracketed material in original).
Although not a lengthy analysis of the issues, the Motter
opinion does summarize the distinction between the issue to be
resolved by the court and the issue to be presented to the jury.
883 F.2d 1223. Moreover, it indicates that the social policy
issue for the court is to be determined by applying a
risk-utility balancing test, id., as indicated in Surace.
Motter and Surace thus are consistent in the type of test to
be applied, although Surace is unique in detailing the precise
contours of the test, at least to the extent feasible.
In his brief, Shouey states that no Pennsylvania appellate
court has held that the "intended user" limitation applies in
cases under § 402A. Plaintiff's Memorandum of Law in Opposition
to Zippo's Motion for Summary Judgment at 5. Actually, the
Superior Court has so held, and specifically relied on Griggs
(among other authorities) in doing so. Riley v. Warren Mfg.,
Inc., 455 Pa. Super. 384, 688 A.2d 221, 228 (Pa.Super. 1997). It
should be noted, however, that the Superior Court concluded by
indicating that the defendant in that case should not be held
liable because the product was not unreasonably dangerous, such
holding being a matter of law or social policy. Id. at 229.
See also Weiner v. American Honda Motor Co., Inc.,
718 A.2d 305, 309 (Pa.Super. 1998) (citing Riley for proposition that,
when injured person is not intended user using product for
intended use, proper under Azzarello social policy analysis to
find product is not unreasonably dangerous).
Thus, both Riley and Weiner indicate*fn7 that the question
of whether the user is an intended user is part of the
Azzarello analysis for unreasonably dangerous, not the Lewis
analysis for defective product. The reason for this is that it is
the conduct of the manufacturer that is at issue, specifically
its decision-making process involving a determination that its
product would be used in a certain way by certain people. Also,
the question of foreseeability is implicated because the test is
whether the user in question is a "reasonably obvious unintended
user." Riley at 228-229 (adopting test of Klemka v. Bic, 1996
WL 571753 (E.D.Pa. Oct. 4, 1996)).
From all of this, a number of principles may be gleaned:
(1) The Supreme Court of Pennsylvania intended, in adopting §
402A, to simplify
those cases in which a plaintiff is injured by a defective
(2) The Supreme Court of Pennsylvania did not intend that
strict liability would apply in every case in which a plaintiff
is injured by a product.
(3) The exception to the general rule of strict products
liability is a matter of social policy and would include those
cases in which the risk posed by the allegedly defective product
is outweighed by its utility.
(4) The determination of whether the person injured was an
intended user of the product is a part of strict products
(5) The question of whether a product is unreasonably dangerous
is a legal question for the court which is answered by utilizing
the risk-utility test.
(6) The question of whether a product is defective is a factual
question for the jury.
(7) The court must determine whether the product is
unreasonably dangerous before submitting the question of defect
to the jury.
(8) Any issue implicating such negligence concepts as
foreseeability is not proper for submission to the jury in a
strict products liability action.
(9) Any issue which requires consideration of the conduct of
the seller or manufacturer is not proper for submission to the
jury in a strict products liability action.
(10) The issue of whether a given user was an intended user
implicates foreseeability and the conduct of the seller or
manufacturer, and therefore is not proper for submission to the
jury in a strict products liability action.
(11) The issue of whether a given user was an intended user
must be part of the social policy/risk-utility analysis by the
court in a strict products liability action.
In other words, the Surace court correctly places the
question of whether the user was an intended user within the
Azzarello test and not the Lewis test, and leaves lower
courts with the problem of a decision which appears to be in
error in this respect, Griggs. However, reduced to its essence,
the holding of Griggs is that a seller or manufacturer will not
be liable under § 402A if the plaintiff is not an intended user
of its product. Thus, whether considered in the context of the
Azzarello test or the Lewis test, the principle is not
altered. The Surace court appeared to conclude as much when it
stated, in discussing Lewis:
We do not minimize the background discussion, and
observe that it seems quite correct (as well as
consistent with Azzarello, for it establishes no
more than that the known hazards of products such as
cigarettes or alcohol, see supra n. 6 or,
presumably, cigarette lighters, see supra n. 7, do
not automatically render their manufacturers or
sellers liable on the theory that their utility is
outweighed by the risks of their usage).
Surace at 1046.*fn8 Moreover, the Superior Court, to whose
opinions we must give due deference, also has concluded that the
user must be an intended user, and has done so in the context of
Finally, as noted above, the Surace court outlined the
reasoning to be applied by a court conducting the Azzarello
test. This includes consideration of a set of factors:
(1) The usefulness and desirability of the product —
its utility to the user and to the public as a whole;
(2) The safety aspects of the product — the
likelihood that it will cause injury, and the
probable seriousness of the injury; (3) The
availability of a substitute product which would meet
the same need and not be as
unsafe; (4) The manufacturer's ability to eliminate
the unsafe character of the product without impairing
its usefulness or making it too expensive to maintain
its utility; (5) The user's ability to avoid danger
by the exercise of care in the use of the product;
(6) The user's anticipated awareness of the dangers
inherent in the product and the avoidability, because
of general public knowledge of the obvious condition
of the product, or of the existence of suitable
warnings or instruction; and (7) The feasibility, on
the part of the manufacturer, of spreading the loss
[by] setting the price of the product or carrying
Surace ad 1046 (bracketed material added; quoting Dambacher v.
Mallis, 336 Pa. Super. 22, 50 n. 5, 485 A.2d 408, 423 n. 5
(1984), allocatur dismissed, 508 Pa. 643,
(per curiam), which in turn cited John Wade, On the Nature of
Strict Tort Liability for Products, 44 Miss. L.J. 825, 837-838
That the user is not an intended user would tend to cause these
factors to weigh in favor of the product being found not
unreasonably dangerous. For example, it is unlawful for children
to smoke cigarettes, so that a cigarette lighter presumably has
little or no utility to a child. It cannot be said, then, that
the conclusion of the Griggs court that, because a child is not
an intended user of a lighter, the manufacturer cannot be held
liable under § 402A, is inconsistent with analysis under the
factors set forth in Surace.
We therefore conclude that Griggs and Surace are not
irreconcilable. Rather, the Griggs court merely denominated its
reasoning as falling within the defect analysis when it is
properly applicable in the unreasonably dangerous analysis. This
reasoning remains valid, as indicated by the Riley court; we
also are given a hint of such by the Surace court. Because we
find that the decisions are reconcilable, we need not undertake
the dubious step of holding that we are not bound by Griggs, an
opinion of our own Court of Appeals, as suggested by Duck Head
Because Griggs is controlling on the issue of whether Zippo
may be liable under § 402A, and Zippo may not be found liable
(pursuant to Griggs), Zippo's motion for summary judgment will
be granted as to Count III of the third party complaint against
Zippo moves for summary judgment on Count II of the third party
complaint based on the lack of evidence that the lighter failed
to function properly.*fn9 We agree: A lighter is purchased for
the purpose of producing a flame suitable for lighting a
cigarette. There is no indication that the Zippo lighter did
anything other than produce a flame, nor is there any indication
that the flame produced was not suitable (as for example, by
being too large) for lighting a cigarette.
Zippo is entitled to summary judgment on Count II of the third