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Keywords

tortplaintiffliabilitytrialpatenttrademarkcorporation
contractplaintifflitigationdiscoveryliabilityappealtrialpleasummary judgmentcorporation

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Young v. Fulton Iron Works Co., 709 S.W.2d 927, Prod.Liab.Rep. (CCH) P 11,053

Facts

Ferracute Machine Company, a New Jersey corporation, manufactured mechanical presses, including the one involved in this case, from 1903 until it became insolvent in the 1930s. A new corporation, also named Ferracute, was formed in 1937 and purchased the assets of the original Ferracute. In 1968, Fulton Iron Works, a Delaware corporation, purchased certain assets of Ferracute, including trademarks and patents, but did not acquire Ferracute's liabilities or its manufacturing plant. The press in question was sold to Macamo Casket Company in 1967 and was involved in an accident in 1982, resulting in the injury of Steven Lee Young.

The pertinent facts, as best we are able to glean them from the record furnished us, are set out in chronological sequence. Ferracute, a New Jersey corporation, began manufacturing mechanical presses in 1903. The press involved in this litigation was manufactured in Bridgeton, New Jersey, in 1926 and, on October 20 of that year, was shipped to Burroughs Adding Machine Company (“Burroughs”), Detroit, Michigan. The press is hereafter referred to by its serial number, 17140.

Issue

Whether Fulton Iron Works Company is liable for injuries caused by a mechanical press manufactured by Ferracute Machine Company, given that Fulton is the successor corporation.

The issue in this appeal is whether Fulton Iron Works Company (“Fulton”) is immune from liability for an injury that occurred when a mechanical press manufactured by Ferracute Machine Company (“Ferracute”) allegedly “malfunctioned,” causing Steven Lee Young (“Steven”) to suffer amputation of his right arm below the elbow.

Rule

The court applied Missouri tort choice of law rules, determining that Missouri substantive law governs the issue of corporate successor liability, and that the product line rule of corporate successor liability is not recognized in Missouri.

The trial court, on the basis of the pleadings, stipulations, and discovery, found that Fulton is not the corporate successor in interest to Ferracute, and granted summary judgment in favor of Fulton.

Analysis

The court analyzed the facts surrounding the asset purchase agreement between Fulton and Ferracute, noting that Fulton did not assume any liabilities of Ferracute and was not a mere continuation of Ferracute. The court emphasized that the relevant contacts for determining liability were centered in Missouri, where the injury occurred and where the plaintiffs resided, thus applying Missouri law to the case.

In support of their first point, plaintiffs assert that whether Fulton can be held liable depends upon “the legal effect of the 1968 agreement for the sale of assets” by Ferracute to Fulton, and that “[t]his is a contracts question.” Consequently, say plaintiffs, the issue “should be decided in accordance with Missouri contract choice of law rules.”

Conclusion

The court affirmed the trial court's decision, holding that Fulton Iron Works was not liable for the injuries caused by the press manufactured by Ferracute, as it did not meet the criteria for successor liability under Missouri law.

Accordingly, in our review, we limit our consideration to the issue whether, on the record before the trial court, Fulton is exempt from legal responsibility for such liability, if any, as Ferracute might have had to bear for Steven's injury, were Ferracute still in existence.

Who won?

Fulton Iron Works Company prevailed in the case because the court found that it was not liable for the actions of its predecessor, Ferracute Machine Company, under Missouri law.

Affirmed.

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