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Case Summary — Smith v. Chrysler Group, L.L.C., No. 17-40901 (5th Cir. Nov. 26, 2018)

Factual and Procedural Background

This is a products-liability appeal arising from a fatal single-vehicle crash in which Arthur Melton Smith was killed while driving a 2013 Jeep Wrangler. Days after the crash Chrysler issued a Recall Notice stating that on some 2012–2013 Jeep Wranglers the transmission oil cooler (TOC) tube could contact the power steering fluid return tube, potentially causing a wear hole, a fluid leak, and, if leaking transmission fluid contacted an ignition source, an underbody fire. The plaintiffs (Mr. Smith's wife and three children) alleged that this recall defect caused a pre-crash underbody fire that produced carbon monoxide exposure, rendering Mr. Smith unconscious and causing the vehicle to leave the road and collide with a bridge pillar.

Procedurally: the plaintiffs sued for strict products liability, negligence, breach of warranty, and Texas Deceptive Trade Practices Act violations. The district court's scheduling order set a May 16, 2016 deadline for plaintiffs' expert reports. Plaintiffs timely filed an initial fire-cause expert report (Dr. Michael Schulz) stating he could not determine whether the recall defect caused the fire. After additional discovery and a production by Chrysler of documents concerning other Jeep fires, plaintiffs filed a supplemental report from Dr. Schulz (filed after the expert-deadline) that purported to reach the conclusion that it was more likely than not the recall defect caused the fire. Chrysler moved to strike the supplemental report and for summary judgment. The magistrate judge recommended striking the supplemental report as untimely and unreliable and granting summary judgment for Chrysler. The district court adopted the recommendation, struck the supplemental report, and entered summary judgment for Chrysler on all claims. The district court also awarded costs to Chrysler; the plaintiffs appealed. The Fifth Circuit affirmed.

Legal Issues Presented

  1. Whether the district court abused its discretion in excluding the plaintiffs' expert's supplemental report (filed after the expert-disclosure deadline) as unreliable and effectively untimely.
  2. Whether the plaintiffs presented sufficient evidence to create a genuine dispute of material fact on causation to survive summary judgment on their design-defect, marketing-defect, negligence, and implied-warranty-of-merchantability claims under Texas law.
  3. Whether the district court abused its discretion in awarding costs to the prevailing defendant in light of the plaintiffs' asserted financial hardship and good faith in bringing suit.

Arguments of the Parties

Plaintiffs' Arguments

  • The plaintiffs argued the supplemental expert report relied on newly produced discovery showing "other defects in Jeep Wranglers that have caused underbody fire," and therefore the supplemental report was permissible under Federal Rule of Civil Procedure 26 as a supplement rather than an untimely new opinion.
  • On the costs issue, the plaintiffs argued they are impoverished and brought the suit in good faith, and these circumstances should counsel against taxing costs in favor of Chrysler.

Defendant's (Chrysler's) Arguments

  • Chrysler characterized the supplemental report as adding nothing relevant to causation that was not already available to the expert before the original expert-deadline, and thus untimely.
  • Chrysler contended Dr. Schulz's new conclusion was not supported by a discernible methodology and was highly conclusory—failing the admissibility standards for expert opinion.
  • Regarding costs, Chrysler argued it was the prevailing party entitled to recover costs under 28 U.S.C. § 1920 and Rule 54, and the plaintiffs had not established the Pacheco factors sufficient to deny costs.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
In re Complaint of C.F. Bean L.L.C., 841 F.3d 365 (5th Cir. 2016) Standard of review: exclusion of expert testimony reviewed for abuse of discretion; summary-judgment review referenced. The court invoked C.F. Bean to state the applicable standards of review when assessing the exclusion of the supplemental expert report (abuse of discretion) and when discussing summary-judgment review.
Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572 (Tex. 2006) Expert testimony required where issues are beyond jurors' common understanding; proximate cause is an element of product-liability and related claims. The court relied on Mack Trucks to conclude expert testimony was necessary to prove the cause of an engine/vehicle fire and to emphasize proximate-cause requirements for plaintiffs' claims.
Sims v. Kia Motors of America, Inc., 839 F.3d 393 (5th Cir. 2016) Illustrates exclusion of unreliable expert testimony and the need for a sound methodology (differential diagnostic approach/simulations) in vehicle-fire causation cases. The court used Sims to compare Dr. Schulz's methodology (or lack thereof) and to foreclose the plaintiffs' argument that the supplemental report was admissible despite methodological deficiencies.
Pipitone v. Biomatrix, Inc., 288 F.3d 239 (5th Cir. 2002) Requires some scientific basis for "ruling in" a phenomenon and methodological support for expert conclusions. The court cited Pipitone to emphasize that experts must show a scientific basis for their causal conclusions; Dr. Schulz failed to do so.
Moore v. Ashland, 151 F.3d 269 (5th Cir. 1998) (en banc) Supports excluding experts who give no reason why offered items support their conclusions. The court cited Moore to support exclusion where an expert does not explain why the evidence is helpful to his causation conclusion.
Wright v. Ford Motor Co., 508 F.3d 263 (5th Cir. 2007) Elements for marketing-defect claims (and related product-liability principles). The court referenced Wright when outlining plaintiffs' burdens on marketing-defect claims under Texas law.
Timpte Indus., Inc. v. Gish, 286 S.W.3d 306 (Tex. 2009) Elements for design-defect claims under Texas law. Used to state the plaintiffs' burden to show an unreasonably dangerous defect that caused the injury.
Shaun T. Mian Corp. v. Hewlett-Packard Co., 237 S.W.3d 851 (Tex. App. 2007) Negligence theories related to product defect are subsumed in defective-product theories. Cited to explain that plaintiffs' negligence claims were encompassed by their defective-product theories and required proof of injury from a defect.
C & M Cooled Engine v. Cub Cadet LLC, 348 F. App'x 968 (5th Cir. 2009) Expert testimony required to determine cause of a mechanical fire (lawnmower fire). Used to support the broader principle that fire-cause determination requires expert evidence.
Gharda USA, Inc. v. Control Sols., Inc., 464 S.W.3d 338 (Tex. 2015) Requires expert testimony and objective proof for complex causation; plaintiffs must support causation with expert testimony to prevent juror inferences from circumstantial evidence. The court relied on Gharda to hold plaintiffs could not rely on circumstantial evidence alone and needed expert proof to establish that the alleged defect caused the fire.
Nissan Motor Co. v. Armstrong, 145 S.W.3d 131 (Tex. 2004) Consistent requirement of competent expert testimony and objective proof (here referenced in the context of unintended acceleration and analogous causation issues). Cited to generalize that competent expert proof is necessary in technical causation disputes.
Flock v. Scripto-Tokai Corp., 319 F.3d 231 (5th Cir. 2003) Example where circumstantial evidence sufficed because the lighter was the only incendiary device in the room. The court distinguished Flock as factually different and inapplicable because multiple potential causes of vehicle fires exist.
Andrews v. Dial Corp., 143 F. Supp. 3d 522 (W.D. Tex. 2015) Pinpointing cause of vehicle fire involves scientific questions beyond lay understanding. Cited to support the conclusion that determining the cause of a vehicle fire requires expert testimony.
Scott v. Dorel Juvenile Group, Inc., 456 F. App'x 450 (5th Cir. 2012) Case cited by plaintiffs but characterized as inapposite to the vehicle-fire context. The court noted Scott was not analogous to this technical fire-causation dispute.
Hyundai Motor Co. v. Rodriguez ex rel. Rodriguez, 995 S.W.2d 661 (Tex. 1999) Implied-warranty-of-merchantability claims in vehicle-crash context tied to crashworthiness and unreasonable dangerousness. The court used Rodriguez to explain that implied-warranty claims require proof of causation like strict-liability claims; dismissal of strict-liability claims thus disposes of implied-warranty claim.
Otis Spunkmeyer, Inc. v. Blakely, 30 S.W.3d 678 (Tex. App. 2000) Jury-charge explanation for implied-warranty claims and requirement to show proximate cause. Used to support the connection between implied warranty and proximate-cause requirements.
Pacheco v. Mineta, 448 F.3d 783 (5th Cir. 2006) Factors a district court may consider in denying costs despite a prevailing party status (financial resources, misconduct, close issues, public benefit, prevailing party wealth); standard of review for costs (abuse of discretion). The court applied Pacheco's framework to evaluate the plaintiffs' objections to the award of costs and affirmed the district court's exercise of discretion.
Moore v. CITGO Refining & Chemicals Co., L.P., 735 F.3d 309 (5th Cir. 2013) It is impermissible as a matter of law to reduce or eliminate a prevailing party's costs based solely on wealth. The court relied on Moore to support the district court's rejection of plaintiffs' argument to deny costs based solely on economic disparity.

Court's Reasoning and Analysis

The court's analysis proceeded in two main stages: first addressing the exclusion of the supplemental expert report and then the grant of summary judgment.

Exclusion of the supplemental expert report: The Fifth Circuit reviewed the district court's exclusion of the report for abuse of discretion. The panel emphasized that Dr. Schulz's supplemental report identified five categories of evidence as the bases for his new causation conclusion—but every listed category was evidence available to him when he filed his initial report. The court found the supplemental report largely recast previously known materials without explaining the analytical methodology by which the newly cited documents changed his earlier conclusion. The panel described the supplemental opinion as "highly conclusory" and insufficient to demonstrate the expert employed any discernible, reliable methodology (no differential diagnostic approach, no simulations, no attempt to "rule in" the phenomenon alleged). The court relied on precedent requiring methodological support for expert causal opinions (e.g., Sims, Pipitone, Moore) and concluded that the district court did not abuse its discretion in excluding Dr. Schulz's supplemental report.

Summary-judgment analysis (causation): Viewing the record in the light most favorable to the plaintiffs, the Fifth Circuit examined whether plaintiffs had other evidence to create a genuine dispute about causation. The plaintiffs relied on (1) the Recall Notice describing the multi-step sequence by which the TOC/power-steering-line proximity could possibly lead to an underbody fire, (2) Mr. Smith's 18% blood carbon-monoxide level, and (3) lay observations/photos of charred grass along the vehicle's post-departure path. The court noted that even accepting the Jeep as defective for purposes of appeal, the plaintiffs needed competent expert testimony to link the asserted TOC defect to an underbody fire that preceded the crash. The plaintiffs' accident-reconstructionist (Webb) opined only that the vehicle caught fire before impact and that byproducts impaired the driver; Webb expressly disclaimed forming an opinion on the fire's cause and left that task to a fire expert. With Dr. Schulz excluded, no qualified fire expert connected the alleged defect to a fire. The court emphasized Texas authorities establishing that vehicle/engine/underbody fire causation is beyond lay jurors' common knowledge and thus requires expert proof; absent such expert proof, circumstantial evidence alone cannot sustain a triable causation theory. Consequently, the court held the plaintiffs failed to carry their burden of production on causation and affirmed summary judgment for Chrysler on design-defect, marketing-defect, negligence, and implied-warranty claims.

Costs award: The court reviewed the district court's costs award for abuse of discretion. Applying the Pacheco factors, the district court found that while the plaintiffs established financial hardship and good faith, they did not show misconduct by Chrysler, the case did not present close and difficult unsettled legal questions, nor did it confer substantial public benefit. The panel also noted precedent precluding denial of costs solely because the prevailing party is wealthy. Finding no abuse of discretion in the district court's approach, the Fifth Circuit affirmed the award of costs (adjusted by the district court to avoid duplicative transcript/video costs).

Holding and Implications

Holding (core ruling): AFFIRMED.

Implications and direct effects:

  • The Fifth Circuit affirmed the district court's exclusion of the plaintiffs' supplemental expert report as unreliable and not adequately supported by methodology or newly provided material.
  • The court affirmed summary judgment in favor of Chrysler on all claims (design-defect, marketing-defect, negligence, and implied-warranty-of-merchantability) because the plaintiffs failed to produce requisite expert evidence establishing that the alleged defect caused the fire and crash.
  • The court affirmed the district court's award of costs to Chrysler after applying the Pacheco factors; the award was not overturned as an abuse of discretion.
  • No broader change to precedent was announced; the decision applies established Fifth Circuit and Texas principles concerning expert admissibility, the necessity of expert proof for complex causation (vehicle fires), and the district court's discretion in awarding costs.

RAMONA L. SMITH, Indi v. dually, and As The Temporary Administrator of the Estate of Her deceased husband, Arthur Melton Smith; RAMONA ALLEN; GLENDA ZIMMER; TARA CHEYENNE SMITH, Plaintiffs - Appellants

E. GRADY JOLLY, Circuit Judge

Appeals from the United States District Court for the Eastern District of Texas Before JOLLY, JONES, and HAYNES, Circuit Judges. E. GRADY JOLLY, Circuit Judge:

This products liability case arises from a deadly car crash. Arthur Melton Smith was killed while driving a 2013 Jeep Wrangler, designed and manufactured by Chrysler Group, L.L.C. Days after the crash, Chrysler sent out a Recall Notice explaining that the transmission oil cooler (TOC) tube of some 2012 and 2013 Jeep Wranglers may leak, which could cause a fire in the underbody of the vehicle.

Mr. Smith's wife and three children contend that Mr. Smith's Jeep had this recall defect and that it caused his Jeep to catch fire and crash. They sued Chrysler asserting claims of strict products liability, negligence, breach of warranty, and violations of the Texas Deceptive Trade Practices Act. After discovery, Chrysler moved for summary judgment, and upon recommendation of the magistrate judge, the district court entered judgment for Chrysler on all claims. For the reasons that follow, we affirm.

I.

In the summer of 2013, Mr. Smith was driving his 2013 Jeep Wrangler in Rusk County, Texas, when he veered off the road, traveled 170 feet, and hit a concrete bridge pillar. He was killed. An autopsy revealed Mr. Smith, a habitual smoker, had a blood carbon-monoxide level of 18%.

Following the crash, Mr. Smith's wife, Ramona Smith, and their three children—Tara Smith, Ramona Allen, and Glenda Zimmer—(collectively, "the plaintiffs") learned that Chrysler had issued a Recall Notice for 2013 Jeep Wranglers because a defect "exist[ed] in some 2012 and 2013 model year Jeep Wrangler vehicles equipped with an automatic transmission." Specifically, the TOC tube was placed relatively close to the power steering fluid return tube. This close proximity risked tube-to-tube contact, which could tear a hole in the TOC tube and cause a leak. And such leaking transmission fluid could come in contact with an ignition source, causing an underbody fire. Mr. Smith's Jeep was never inspected for the defect before his accident and the wrecked Jeep was not preserved for experts to conduct a post-accident inspection. But several days after the crash, Zimmer and Allen returned to the scene of the accident and photographed what appears to be charred grass along the path Mr. Smith's Jeep traveled once it left the road.

According to the Complaint, Mr. Smith's car-insurance company "destroyed" the Jeep.

The plaintiffs sued Chrysler for strict products liability, negligence, breach of warranty, and violations of the Texas Deceptive Trade Practices Act. In their view, the recall defect caused a fire to start in the underbody of Mr. Smith's Jeep, filling the passenger compartment with carbon monoxide. Upon being exposed to this carbon monoxide while driving, Mr. Smith lost consciousness and ran off the road and crashed.

As the plaintiffs' case progressed in the district court, the parties designated their experts and provided expert reports. The district court's scheduling order required the plaintiffs to designate expert witnesses and provide expert reports by May 16, 2016. On May 16, the plaintiffs timely filed a report produced by their fire cause expert, Dr. Michael Schulz, in which he opined that he could not determine if the fire was caused by the recall defect. Apparently recognizing the weakness of their case, on August 5, the plaintiffs filed a motion to compel Chrysler to produce documents relating to other fires in any model Jeep Wrangler. On October 7, Chrysler moved for summary judgment and on October 11, Chrysler moved to strike Dr. Schulz's initial expert report on the grounds that it did not meet the standards for the admission of expert testimony set out in Daubert. On October 20, the magistrate judge granted plaintiffs' motion to compel at which time Chrysler released ten years' worth of documents relating to incidences of other Jeep fires caused by defects other than the specific recall defect the plaintiffs claim caused Mr. Smith's Jeep to crash. Then on December 9, the plaintiffs responded to Chrysler's October 11 summary judgment motion and at that time attached a supplemental expert report from Dr. Schulz. This supplemental report, however, consisted primarily of a rehash of Dr. Schulz's analysis of information that was available to him at the time of his original report, and made only cursory reference to the further information furnished by Chrysler in its supplemental discovery production. He does, however, purport to have examined this new information and, retreating from his earlier inability to come to any conclusion, declares that this new information has allowed him to draw an "additional conclusion," namely, now he is able to conclude that it is more likely than not that the recall defect caused the fire that caused the crash. On December 16, Chrysler promptly moved to strike Dr. Schulz's supplemental report as untimely and unreliable.

Fast forward to June 26, 2017. At this time, the magistrate judge recommended striking Dr. Schulz's supplemental report and granting summary judgment to Chrysler. The magistrate judge reasoned that the supplemental report was based upon documents that were available to Dr. Schulz prior to the May 2016 expert report deadline and therefore the supplemental report, filed six months after the expert report deadline, was untimely. The magistrate judge also concluded that Dr. Schulz's new opinion was not reliable: "the additional discovery provided by Chrysler about other vehicle defects does not explain why Schulz should be allowed to reverse his opinion that there is sufficient evidence for him to have an opinion about this defect." Furthermore, Dr. Schulz offered no analysis to explain how the new information had changed his first conclusion that he could not determine a causal connection between the accident and the alleged defect. On this basis, the magistrate judge proceeded to recommend that Chrysler's summary judgment motion should be granted.

On August 14, 2017, the district court adopted the magistrate judge's recommendations, struck Dr. Schulz's supplemental expert report and opinion, and entered summary judgment for Chrysler. The court agreed that the supplemental report with its new and different opinion was untimely because its conclusion was based on information that was available to Dr. Schulz before the expert report deadline of May 16, 2016. The district court also agreed that the report "would not constitute appropriate summary judgment evidence" because Dr. Schulz's "new findings are highly conclusory." With the report and new opinion excluded, the district court granted Chrysler's summary judgment motion on all claims.

The plaintiffs now appeal the district court's rulings striking their expert's supplemental report, denying their evidentiary motions to limit the testimony of Chrysler's experts, and granting summary judgment for Chrysler on their design-defect, marketing-defect, negligence, and implied-warranty-of-merchantability claims.

Although the plaintiffs briefly mention manufacturing defect in their opening brief on appeal, they do not appeal the dismissal of their claims alleging breach of implied warranty of fitness for a particular purpose, express warranty, and violations of the Texas Deceptive Trade Practices Act. Moreover, the plaintiffs' Complaint does not allege a manufacturing defect.

II.

Because this appeal involves the exclusion of an expert report for the purposes of a summary judgment determination, we first address that evidentiary ruling and then turn to the grant of summary judgment. We review "a district court's exclusion of expert testimony for abuse of discretion" and do not disturb the court's decision unless it is "manifestly erroneous." In re Complaint of C.F. Bean L.L.C., 841 F.3d 365, 369 (5th Cir. 2016).

On appeal, the plaintiffs argue that the district court abused its discretion in finding that the supplemental expert report did not rely on new information. Because the new report describes "other defects in Jeep Wranglers that have caused underbody fire" the plaintiffs argue that the expert report filed after the deadline for submitting expert reports is not untimely, but is allowable as supplemental within the meaning of Federal Rule of Civil Procedure 26. Chrysler, on the other hand, characterizes the report as adding nothing relevant to causation that was not known in May 2016. Chrysler further argues that Dr. Schulz's new conclusion is not based upon any methodology discernable from the new evidence submitted in his report.

In this supplemental report, when Dr. Schulz outlines, by number and paragraph, the five categories of evidence, upon which he relies to form his new opinion, every such itemization is evidence that was available to him at the time he filed his initial report: (1) "the observations of Glenda Zimmer," a plaintiff in this litigation, (2) the images and discovery deposition testimony of Zimmer, (3) the fire pattern shown in photographs of the driver's side of Mr. Smith's Jeep, (4) the fire pattern shown in photographs of the sill plate of Mr. Smith's Jeep, and (5) the testimony of (a) Dr. Stash, medical examiner, (b) Dr. Bernard, Chrysler's medical expert, and (c) Ramona Smith, a plaintiff in this litigation. Dr. Schulz acknowledges in his supplemental report that the above bases are "a partial restatement" of his original report and deposition testimony. Yet Dr. Schulz's use of the term "review and analysis" of the previously available evidence and the newly disclosed documents is the sum total of his description of his methodology applied to come to this new conclusion and opinion.

District courts have "wide latitude in determining the admissibility of expert testimony" and this Court does not disturb the district court's decision unless it is "manifestly erroneous." C.F. Bean, 841 F.3d at 369. To be sure, Dr. Schulz's supplemental report purports to exclude these other Jeep defects, which were revealed in the newly produced evidence, from the potential causes of the instant Jeep fire, allowing Dr. Schulz to reach a level of certainty in his conclusion that he was previously unable to attain. But this conclusion tells us only that the Jeep in question here did not have the same defect as other Jeeps that caught fire. That is, the new evidence allows him to eliminate a fire connected to these other Jeep defects. It does not allow us to conclude that Mr. Smith's Jeep had a defect nor that the alleged defect could cause a fire or, more particularly, whether it could cause the fire that caused this crash. The district court correctly noted that Dr. Schulz's new findings were "highly conclusory" and did not meet the standard for the admissibility of expert opinion. Dr. Schulz does not explain his methodology for reaching his conclusion, leaving the district court to guess at how he applied the newly produced evidence to form his new conclusion. It is certainly clear however, that none of the instances of Jeep fires produced by Chrysler related to the recall defect at issue here. Cf. Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex. 2006) ("The trial court was not required to accept [a fire expert's] opinion at face value just because [the fire expert] was experienced in examining post-collision fuel-fed fires."); see also Sims v. Kia Motors of America, Inc., 839 F.3d 393, 401-03 (5th Cir. 2016).

Chrysler has also produced uncontested evidence that Jeep began placing an interim fix to cure the recall defect on all Jeep Wranglers produced after August 22, 2012. Mr. Smith's Jeep was produced on September 5, 2012.

Our recent opinion in Sims forecloses the plaintiffs' arguments for the admissibility of Dr. Schulz's supplemental report. There we found that a district court did not abuse its discretion in excluding the expert report and testimony of a fuel tank expert who travelled to the crash site, inspected both the damaged vehicle and an undamaged model, ran computer simulations and employed a differential diagnostic approach to determine that a gas tank defect caused a vehicle fire. Here, Dr. Schulz did not have access to the damaged vehicle, did not run simulations, did not purport to employ a differential diagnostic approach to "rule out" "'all other likely alternatives' using 'generally accepted diagnostic principles,'" and did not even attempt to demonstrate "some scientific basis for 'ruling in' the phenomenon [he] allege[s]." Id. at 401-02 (quoting Pipitone v. Biomatrix, Inc., 288 F.3d 239, 246 (5th Cir. 2002)); see also Moore v. Ashland, 151 F.3d 269, 278 (5th Cir. 1998 (en banc) (excluding expert in part because he "gave no reason why these items were helpful in reaching his conclusion on causation").

To the point, Dr. Schulz's supplemental report failed adequately to connect the dots between the newly disclosed information and his conclusion, and accordingly, the district court did not abuse its discretion in excluding the report. We thus affirm the district court's exclusion of Dr. Schulz's supplemental report.

Because Dr. Schulz's report is an inadmissible expert opinion for the reasons stated above, we do not address Chrysler's argument that the report was untimely under Rule 26 of the Federal Rules of Civil Procedure.

III.

We next examine whether the plaintiffs offered other sufficient evidence to survive summary judgment. We review a district court's grant of summary judgment de novo, viewing all the facts and evidence in the light most favorable to the non-movant. C.F. Bean, 841 F.3d at 370. Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A genuine dispute of material fact exists when the "evidence is such that a reasonable jury could return a verdict for the nonmoving party." C.F. Bean, 841 F.3d at 370.

A.

As to their claims for design defect, marketing defect, and negligence under Texas law, the plaintiffs must show (1) an unreasonably dangerous defect that (2) caused Mr. Smith's death. See Wright v. Ford Motor Co., 508 F.3d 263, 275 (5th Cir. 2007) (marketing defect); Timpte Indus., Inc. v. Gish, 286 S.W.3d 306, 311 (Tex. 2009) (design defect); Shaun T. Mian Corp. v. Hewlett-Packard Co., 237 S.W.3d 851, 857 (Tex. App. 2007) ("[A]ppellants alleged no negligence other than conduct relating to whether the [product] was unreasonably dangerous when sold. As a result, appellants' negligence theories are encompassed and subsumed in their defective product theories, and appellants' burden at trial would be to prove injury resulting from a product defect."). The district court held that the plaintiffs failed to offer sufficient evidence to prove both defect and causation and that their failure to produce expert testimony supporting their theory of causation was critical.

We repeat ourselves to say that in their complaint, the plaintiffs allege that Mr. Smith's Jeep was defective because "the power steering line may contact and wear a hole in the [TOC] line" and the Jeep lacked adequate warnings about the defect. For purposes of this appeal, we will assume without deciding that Mr. Smith's Jeep was defective and lacked adequate warnings. We thus proceed straight to causation.

On appeal, the plaintiffs attempt to narrow their allegation, arguing that the Jeep was defectively designed because the TOC tube and the power steering fluid return tube were "less than 1/3 [of an inch] away from each other at their closest point."

The plaintiffs point to multiple bases of circumstantial evidence to argue that they have produced sufficient evidence that the recall defect caused the fire that caused the wreck that caused Mr. Smith's death. First, they present the Recall Notice which states that the transmission oil cooler tube on "some 2012 and 2013 model year Jeep Wrangler vehicles . . . . may inadvertently come in contact with the power steering fluid return tube" which "could eventually cause the transmission oil cooler tube to develop a wear hole and leak" which "could cause transmission damage and if the leaking transmission fluid comes in contact with an ignition source, cause an underbody fire." Second, the plaintiffs point to Mr. Smith's 18% blood carbon-monoxide level which they argue is evidence of a pre-crash underbody fire consistent with the fire possibility mentioned in the Recall Notice. Third, the plaintiffs put forth eyewitness accounts of burn marks on the grass that followed the path of Mr. Smith's Jeep that they argue are evidence of a pre-crash fire.

The plaintiffs also point to the burn damage on the driver's side of Mr. Smith's Jeep and the burn damage on the base of the pillar that Smith's Jeep ran into. But those arguments are absent from their summary-judgment response below. The district court did not abuse its discretion in refusing to consider this late evidence. See Nunez v. Allstate Ins. Co., 604 F.3d 840, 846 (5th Cir. 2010).

Finally, the plaintiffs offer an expert to show causation: Mr. Andrew Webb, an accident reconstructionist. With Dr. Schulz excluded, this accident reconstructionist is the only expert they present. When asked whether he had "an opinion about whether the defect in the Smiths' Jeep proximately caused the Jeep to crash," Mr. Webb replied, "Based on the evidence, yes, sir. . . . [T]he vehicle caught on fire prior to hitting the pillar and the byproducts of combustion impaired the driver." A careful look at Mr. Webb's expertise demonstrates that he is not the expert the plaintiffs need to ultimately establish their case. The plaintiffs must show the alleged defect, a hole in the TOC line, caused the fire to which Mr. Webb refers. Mr. Webb offers no opinion on that point. Instead, Mr. Webb testified that he did not investigate or "try to render an opinion or conclusion as to the cause and origin of the fire," leaving that "to the fire expert." But, as we have seen, Dr. Schulz could not carry the ball that had been handed to him.

The other potential experts that the plaintiffs proffer, Ms. Froehlich, Mr. Wilkinson, and Mr. Brookes, offer evidence of defect but not causation.

The absence of testimony from a fire expert is critical, particularly here where there was no evidence that this alleged defect had caused a fire in any other Jeep. Under Texas law, expert testimony is "required when an issue involves matters beyond jurors' common understanding." Mack Trucks, Inc., 206 S.W.3d at 583. Further, "[w]hether expert testimony is necessary to prove a matter or theory is a question of law." Id. Texas courts have consistently held that the cause of an engine fire is beyond the common experience and understanding of a lay juror. See, e.g., id. ("A lay juror's general experience and common knowledge do not extend to whether design defects such as those alleged in this case caused releases of diesel fuel during a rollover accident."); see also Sims v. Kia Motors of America, Inc., 839 F.3d at 409 (in vehicle fire case "expert testimony is crucial in establishing that the alleged design defect caused the injury"); C & M Cooled Engine v. Cub Cadet LLC, 348 F. App'x 968 (5th Cir. 2009) (expert testimony required to determine cause of lawnmower fire); cf. Gharda USA, Inc. v. Control Sols., Inc., 464 S.W.3d 338, 348 (Tex. 2015) (expert required to determine cause of chemical fire); Nissan Motor Co. v. Armstrong, 145 S.W.3d 131, 137 (Tex. 2004) ("[W]e have consistently required competent expert testimony and objective proof that a defect caused the acceleration. . . . These requirements are not peculiar to unintended acceleration cases.").

The case authority makes clear that the district court was within its discretion in holding that testimony from a fire expert was necessary to establish causation. This case illustrates the type of complex causation theory that requires "expert testimony and objective proof." Gharda, 464 S.W.3d at 348. Here, the plaintiffs were required to produce evidence that a defect in the Jeep's transmission oil cooler caused a leak that caused transmission fluid to come in contact with an ignition source that caused the fire. The plaintiffs have been unable to produce such expert testimony. Without such an expert, the plaintiffs have not met their burden of production under Texas law. See Gharda USA, Inc., 464 S.W.3d at 353 ("[O]ur holding that the plaintiffs must have supported their causation theory with expert testimony prohibits the jury from inferring causation based on this circumstantial evidence."). The plaintiffs' failure to produce a fire expert who can identify the cause of the fire is therefore fatal to their success.

In the Recall Notice itself, we count at least four conditional events that must occur for the recall defect to cause an underbody fire: "The [TOC] tube . . . may inadvertently come into contact with the power steering fluid return tube. This tube-to-tube contact could eventually cause the [TOC] tube to develop a wear hole and leak. A loss of transmission fluid could cause transmission damage and if the leaking transmission fluid comes in contact with an ignition source, cause an underbody fire."

The plaintiffs identify Flock v. Scripto-Tokai Corp. as an example of circumstantial evidence alone being sufficient to demonstrate that a defect caused a fire. 319 F.3d 231 (5th Cir. 2003). The facts of that case, however, are demonstrably different from the precedent cited above requiring expert testimony. At issue in Flock was whether a child started a fire by using a cigarette lighter. We held that there was sufficient evidence of the fire's origin because the lighter was the only incendiary device in the room where the fire originated. There are innumerable potential causes of a vehicle engine fire. The factors involved in pinpointing the cause of an automobile fire are quintessentially "scientific questions, including questions of chemistry, physics, and electrical engineering, outside the common understanding of a layperson." Cf. Andrews v. Dial Corp., 143 F.Supp.3d 522, 529 (W.D. Tex. 2015). For the same reason, the plaintiffs' reliance on Scott v. Dorel Juvenile Group, Inc. is inapposite. 456 F. App'x 450 (5th Cir. 2012) (considering defect in kitchen cabinet child safety latch).

We recognize that, had the Jeep been preserved, the plaintiffs' expert may well have been better able to connect the dots to these items of evidence. But on the record presented to us, we hold that the plaintiffs fail to offer sufficient evidence to establish a triable case that the defect caused the fire and crash of Mr. Smith's Jeep.

B.

Because the plaintiffs' strict liability claims must be dismissed, so too must their implied-warranty-of-merchantability claim. See Hyundai Motor Co. v. Rodriguez ex rel. Rodriguez, 995 S.W.2d 661, 665 (Tex. 1999) ("An uncrashworthy vehicle cannot be unfit for ordinary use but not unreasonably dangerous, nor can it be unreasonably dangerous but fit for ordinary use; it must be both or neither."); Otis Spunkmeyer, Inc. v. Blakely, 30 S.W.3d 678, 684 (Tex. App. 2000) (explaining that a Jury Charge for implied warranty of merchantability must "inquire whether the breach proximately caused the plaintiff's injuries, as it would in a crashworthiness or strict products liability case." (emphasis added)). In Texas, "[p]roducing or proximate cause is an element of . . . negligence, misrepresentation, breach of warranty, and design, manufacturing, and marketing defects." Mack Trucks, Inc., 206 S.W.3d at 582. The plaintiffs' implied warranty claim must suffer the same fate as their other claims because they have failed to produce evidence of proximate causation.

IV.

After the district court entered final judgment in favor of Chrysler, Chrysler filed its bill of costs requesting $52,372.88. The plaintiffs objected to the bill of costs, primarily citing their limited economic hardship and Chrysler's enormous financial resources. Ultimately, the district court overruled most of the plaintiffs' general objections but granted their specific objection to Chrysler's request to recover costs for both paper transcripts and video recordings of the same deposition and awarded Chrysler costs in the amount of $29,412.29.

"Unless a federal statute, [the Federal Rules of Civil Procedure], or a court order provides otherwise, costs—other than attorney's fees—should be allowed to the prevailing party." Fed. R. Civ. P. 54. Such costs include fees for the clerk/marshal, printed or electronically recorded transcripts, printing, witnesses, and making copies. 28 U.S.C. § 1920 (2012). "Only when a clear abuse of discretion is shown can an award of cost be overturned." Pacheco v. Mineta, 448 F.3d 783, 793 (5th Cir. 2006).

The plaintiffs do not dispute that Chrysler is the prevailing party under the district court's order or that the costs awarded are recoverable under § 1920. Instead, they argue the district court abused its discretion in awarding costs to Chrysler at all in the light of their "impoverished condition" and good faith in bringing suit.

In support of their argument, the plaintiffs cite to Pacheco v. Mineta, wherein this Court explained that a district court may, but is not required to, deny a prevailing party costs where suit was brought in good faith and denial is based on at least one of the following factors: "(1) the losing party's limited financial resources; (2) misconduct by the prevailing party; (3) close and difficult legal issues presented; (4) substantial benefit conferred to the public; and (5) the prevailing party's enormous financial resources." 448 F.3d at 794. Importantly, we withheld judgment on whether "any of [the above factors] is a sufficient reason to deny costs." Id. at 794 n.18.

We can assume that the plaintiffs brought suit in good faith and their financial condition is dire; even so the district court was not required to deny Chrysler its costs because of its comparative ability to more easily bear the costs. See, e.g., Moore v. CITGO Refining & Chemicals Company, L.P., 735 F.3d 309, 319-20 (5th Cir. 2013) ("[R]educing or eliminating a prevailing party's cost award based on its wealth—either relative or absolute—is impermissible as a matter of law."). This point is especially applicable in the light of the "strong presumption that the prevailing party will be awarded costs." Pacheco, 448 F.3d at 793. Here, the district court carefully and thoroughly examined the factors outlined in Pacheco and determined that the plaintiffs had not overcome the presumption that Chrysler was entitled to costs. Although the court sympathetically found that the plaintiffs had established financial hardship, it felt compelled to overrule their general objection because they had not established misconduct by Chrysler, their suit did not present a close and difficult issue of unsettled law, and their case did not confer a substantial benefit to the public. Citing Moore and the strong presumption toward awarding costs in Federal Rule of Civil Procedure 54, the district court declined to withhold costs on the basis of financial hardship alone. We can find no error in the district court's methodology or conclusion, and conclude the district court acted within its discretion in its award of costs.

V.

In sum, we hold that the district court did not abuse its discretion in excluding the plaintiffs' untimely expert report and affirm the district court's grant of summary judgment for Chrysler on all claims. Further, the district court did not abuse its discretion in awarding costs to Chrysler. Accordingly, the judgment of the district court is in all aspects

Because we hold that the plaintiffs failed to create a genuine issue of material fact as to causation, we need not reach the further questions related to challenges to the defendant's experts. --------

AFFIRMED.

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Smith v. Chrysler Grp., L.L.C.
(Nov 26, 2018)