Waiver and Invited-Error Limits on the “Malfunction Theory” in Massachusetts Product-Fire Cases

Case: Citation Insurance Company v. Broan-NuTone LLC
Court: United States Court of Appeals for the First Circuit
Date: August 28, 2026
Panel: Barron, Chief Judge; Lipez and Rikelman, Circuit Judges

1. Introduction

This subrogation action arises from a September 15, 2020 house fire at a Massachusetts residence insured by Citation Insurance Company (“Citation”), which paid roughly $726,000 and sued as subrogee of the homeowner. Citation alleged the fire originated in a bathroom ceiling exhaust fan manufactured by Broan-NuTone LLC (“Broan”) and driven by a motor sold by Jakel Motors Incorporated (“Jakel”), with a thermal cutoff device (“TCO”) intended to interrupt power if the motor overheated.

The central issues on appeal were not merely technical questions about a fan motor’s failure, but litigation-structure questions: (i) what evidence is necessary under Massachusetts implied warranty law to proceed on manufacturing-defect and design-defect theories, and (ii) whether Citation could invoke a “malfunction theory” to avoid proving a specific defect—particularly when its arguments in the district court split the case into manufacturing-defect and design-defect tracks and relied on different evidentiary showings for each.

2. Summary of the Opinion

The First Circuit affirmed summary judgment for Broan and Jakel. The court declined to decide whether Massachusetts recognizes the “malfunction theory,” or under what conditions it might apply. Instead, the court held that—even assuming the malfunction theory is available—Citation’s appellate argument failed because of how Citation litigated the case below:

  • Design defect: Citation did not rely on the malfunction theory in the district court to excuse proof of reasonable alternative designs; it relied on deposition testimony that the district court excluded under Rule 26. Citation did not appeal that exclusion, and it did not develop another record-based alternative-design argument. The design-defect challenge was therefore forfeited/waived.
  • Manufacturing defect: Citation used the malfunction theory below only to argue “manufacturing defect,” which necessarily required circumstantial evidence supporting an inference that the defect was manufacturing rather than design. The record, as framed, did not supply that bridge. Having invited the district court to treat malfunction theory as a manufacturing-defect substitute, Citation could not on appeal reframe the malfunction theory as eliminating the need to distinguish manufacturing from design defect at all.

Accordingly, summary judgment was affirmed.

3. Analysis

3.1. Precedents Cited

The opinion is built from two sets of authority: (i) Massachusetts implied warranty/product defect standards, and (ii) federal appellate doctrines governing preservation, waiver/forfeiture, and affirmance on any ground.

A. Massachusetts product defect / implied warranty framework

  • Lally v. Volkswagen Aktiengesellschaft, 698 N.E.2d 28, 43 (Mass. App. Ct. 1998): The court used Lally for the elements of a Massachusetts breach of implied warranty of merchantability claim—manufacture/sale, defect at time of sale, foreseeable use, and legal causation. Lally provided the doctrinal “checklist” that made expert proof of defect and causation central.
  • Evans v. Lorillard Tobacco Co., 990 N.E.2d 997 (Mass. 2013): Evans supplied modern Massachusetts design-defect principles: design defect requires an available reasonable alternative design that reduces risk without undue cost or interference with performance. The district court relied on this to find the record lacking on feasibility/cost/performance. On appeal, Evans mattered less for its substantive rule than for demonstrating what Citation did (and did not) preserve and support in the record.
  • Back v. Wickes Corp., 378 N.E.2d 964 (Mass. 1978): Back distinguished manufacturing defects from other defect types by emphasizing comparison between “the propensities of the product as sold” and what the designer intended. The First Circuit used Back to explain why a “manufacturing defect” theory—however proven—must connect to a deviation from intended design, not merely “a bad outcome.”
  • Fernandes v. Union Bookbinding Co., 507 N.E.2d 728 (Mass. 1987): Cited by the defendants below for the requirement that the defect/breach existed at the time of sale and proximately caused the damage. This supports the general need for defect identification and causation proof, even if circumstantial.
  • Collins v. Sears, Roebuck & Co., 583 N.E.2d 873 (Mass. App. Ct. 1992) and Walker v. Gen. Elec. Co., 968 F.2d 116 (1st Cir. 1992): These cases were invoked by Citation to argue Massachusetts allows plaintiffs to proceed without pinpointing “the exact” cause when other causes are ruled out and when probability supports defendant responsibility. The First Circuit did not reject that general proposition; instead, it held that Citation’s theory selection and preservation choices prevented it from using that proposition to rescue both design and manufacturing theories.
  • Wasylow v. Glock, Inc., 975 F. Supp. 370 (D. Mass. 1996): Used to illustrate the manufacturing-defect concept of deviation from “identical products” from the same manufacturer—supporting the point that not every “deficiency” is self-evidently manufacturing rather than design.

B. Federal procedure and appellate preservation

  • Miceli v. JetBlue Airways Corp., 914 F.3d 73 (1st Cir. 2019) and McCoy v. Town of Pittsfield, 59 F.4th 497 (1st Cir. 2023): These provided the de novo summary judgment standard and the “no genuine dispute of material fact” framework.
  • McGunigle v. City of Quincy, 835 F.3d 192 (1st Cir. 2016): Cited for the principle that the appellate court may affirm summary judgment on any ground supported by the record, not only the district court’s reasoning—a key structural premise allowing the First Circuit to focus on preservation/waiver consequences.
  • Levin v. Dalva Bros., 459 F.3d 68 (1st Cir. 2006): Cited for the standard diversity rule: federal court applies state substantive law.
  • Morales Feliciano v. Rullan, 378 F.3d 42 (1st Cir. 2004): The court used this as the “bedrock rule” against raising new arguments on appeal, which blocked Citation’s attempt to retool the design-defect case through the malfunction theory after having pursued a different strategy below.
  • Orenstein v. United States, 191 F.2d 184 (1st Cir. 1951) and Box Pond Ass'n v. Energy Facilities Siting Bd., 758 N.E.2d 604 (Mass. 2001): These cases framed the “invited error” concept: a party ordinarily cannot complain on appeal about an error it induced or invited. The First Circuit used invited error to explain why Citation’s litigation architecture (malfunction theory only for manufacturing defect; alternative-design proof for design defect) constrained what it could claim on appeal.
  • O'Horo v. Bos. Med. Ctr. Corp., 131 F.4th 1 (1st Cir. 2025): Quoted for the summary judgment record-viewing principle (facts in the light most favorable to the nonmovant).

3.2. Legal Reasoning

A. The court’s core move: deciding less to resolve more

Citation’s headline argument was that Massachusetts recognizes the “malfunction theory” and that it permits a plaintiff to prove defect by circumstantial evidence without identifying the specific defect. The First Circuit’s response was strategically narrow: it assumed (without deciding) that Massachusetts recognizes the malfunction theory and that it could apply even in this product-fire context, but held that Citation still loses because:

  • its design-defect theory was not properly preserved on the malfunction-theory rationale; and
  • its manufacturing-defect theory, as litigated, still required evidence supporting an inference of manufacturing deviation (not merely “defect”).

B. Design defect: forfeiture through litigation choices

In the district court, Citation did not argue “malfunction theory means I need not prove alternative designs.” Instead, it argued it did have alternative designs, relying “solely” on the excluded deposition testimony of its electrical engineering expert.

On appeal, Citation did not challenge the exclusion ruling and pivoted to malfunction theory and circumstantial proof. The First Circuit treated that as an impermissible new appellate theory under Morales Feliciano v. Rullan. The practical takeaway is that a litigant cannot: (i) select a proof route at summary judgment; (ii) lose that route on an evidentiary ruling; (iii) then, without appealing that ruling, adopt a new theory that would have changed the proof obligations in the first place.

C. Manufacturing defect: malfunction theory does not automatically identify the defect category

The district court gave two reasons on manufacturing defect (including causation/expert concessions), but the First Circuit focused on the “deviation” point grounded in Back v. Wickes Corp.: a manufacturing defect presupposes a divergence from intended design. Citation’s own summary judgment opposition identified multiple “deficiencies” in the TCO (temperature rating/degradation; eutectic element pooling; lead-bend issues), yet did not supply a coherent explanation—consistent with its expert proof posture—showing that the fire more probably arose from a manufacturing deviation rather than a design choice or other non-manufacturing issue.

The First Circuit emphasized a mismatch between the malfunction theory’s general logic and Citation’s litigation framing. A malfunction-based inference might support “a defect,” but Citation used malfunction theory only to prove “manufacturing defect.” That choice “invited” the district court to demand a manufacturing-specific inferential link. When Citation later tried to argue on appeal that malfunction theory eliminates the need to distinguish design versus manufacturing defect, it ran into invited error principles (Orenstein v. United States; Box Pond Ass'n v. Energy Facilities Siting Bd.).

D. The silent but consequential backdrop: Rule 26 and expert-proof discipline

Although the First Circuit did not need to resolve the Rule 26 expert-disclosure sanction (because Citation did not appeal it), the case illustrates a common products-liability fault line: if essential defect and feasibility opinions are not clearly and “completely” stated in the expert report, later deposition expansions risk exclusion—potentially collapsing both defect identification and alternative-design feasibility elements.

3.3. Impact

A. On future Massachusetts product-fire litigation in federal court

  • Preservation is outcome-determinative: The decision underscores that malfunction-theory arguments must be tied to specific defect theories (design vs manufacturing) in the trial court, or they may be unavailable on appeal.
  • Malfunction theory (even if recognized) is not a “category-free” shortcut: If the plaintiff pleads and argues distinct manufacturing and design defect theories, the plaintiff should expect to shoulder the doctrinal burdens distinctive to each—unless it clearly argues for a different allocation (e.g., that malfunction theory supports a general defect inference sufficient for liability irrespective of category).
  • Expert disclosures matter as much as expert conclusions: Litigants should treat Rule 26 compliance as a merits issue—because exclusion of feasibility/cost/performance opinions can eliminate Evans-compliant design-defect proof.

B. On the “malfunction theory” in Massachusetts

The court deliberately did not announce whether Massachusetts recognizes the malfunction theory, leaving the doctrinal question open. The precedential force of the decision lies elsewhere: even if malfunction theory exists, it does not cure waiver, invited error, or a plaintiff’s failure to connect circumstantial evidence to the defect theory actually pursued.

4. Complex Concepts Simplified

  • Subrogation: An insurer that pays its insured’s loss can “step into the shoes” of the insured and sue the parties allegedly responsible for that loss.
  • Implied warranty of merchantability (Massachusetts): A seller/manufacturer implicitly warrants that goods are fit for ordinary purposes. In practice, Massachusetts warranty law functions similarly to strict products liability in many contexts, but plaintiffs still must prove defect and causation.
  • Manufacturing defect vs. design defect:
    • Manufacturing defect: the product was supposed to be made one way, but this unit deviated due to an error in manufacturing.
    • Design defect: the product was made as intended, but the intended design was unreasonably unsafe given a reasonable alternative design.
  • Reasonable alternative design (from Evans): For design defects, the plaintiff generally must show a feasible modification that reduces risk without undue cost or harming performance.
  • Malfunction theory (as argued): A method of proving defect by circumstantial evidence from a product’s malfunction and the elimination of other likely causes—often used when the product is destroyed or the precise failure cannot be pinpointed.
  • Waiver/forfeiture vs. invited error:
    • Forfeiture/waiver: failing to raise an argument in the trial court generally prevents raising it on appeal.
    • Invited error: a party generally cannot complain on appeal about a position or framing it induced the trial court to adopt.
  • Rule 26 expert report requirements: Expert opinions must be disclosed in a written report with a “complete statement” of opinions and bases. If a party later tries to add new opinions in deposition, a court may exclude them.

5. Conclusion

Citation Insurance Company v. Broan-NuTone LLC establishes a practical, litigation-shaping rule for Massachusetts product-defect cases in federal court: even assuming the availability of a malfunction-theory inference, a plaintiff cannot use it on appeal to escape proof burdens or evidentiary setbacks that result from the plaintiff’s own trial-level framing, preservation decisions, and invited positions.

The opinion’s significance lies less in defining what the malfunction theory is in Massachusetts (a question the court left open) and more in clarifying what malfunction theory cannot do: it cannot cure waived theories, replace unappealed expert-exclusion rulings, or automatically transform “a defect” into “a manufacturing defect” when the plaintiff chose to litigate the case on that categorical basis.