Smoot, Magdalene M. v. Mazda Motor of Ameri ( 2006 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 05-4577
MAGDALENE M. SMOOT and RYAN M. SMOOT,
Plaintiffs-Appellants,
v.
MAZDA MOTORS OF AMERICA, INC. and
TOKIO MARINE AND FIRE INSURANCE COMPANY, LTD.,
Defendants-Appellees.
____________
Appeal from the United States District Court
for the Eastern District of Wisconsin.
No. 02-C-159—David R. Herndon, Judge.
____________
ARGUED SEPTEMBER 20, 2006—DECIDED NOVEMBER 29, 2006
____________
Before EASTERBROOK, Chief Judge, and POSNER and
EVANS, Circuit Judges.
POSNER, Circuit Judge. The district judge, after barring
the plaintiffs’ expert from testifying, dismissed this diversity
personal-injury suit (the substantive issues in which are
governed by Wisconsin law) on the ground that without
expert testimony the plaintiffs could not prove their case.
Before reviewing that ruling, we remark the confusion
in the parties’ briefs concerning the elements of the diversity
jurisdiction. The jurisdictional statement in the appellants’
2 No. 05-4577
brief states that the federal district court’s jurisdiction was
based on diversity of citizenship “and the jurisdictional
amount of $75,000.” In fact diversity jurisdiction depends on
the jurisdictional amount’s exceeding $75,000, exclusive of
interest and costs. 28 U.S.C. § 1332(a). The jurisdictional
statement goes on to recite that the plaintiffs are citizens of
Wisconsin (a proper jurisdictional allegation since the
plaintiffs are natural persons) and that defendant Mazda “is
a foreign corporation incorporated under the laws of the
State of California.” A corporation, however, has two places
of citizenship: where it is incorporated, and where it has its
principal place of business. 28 U.S.C. § 1332(c)(1). If Mazda’s
principal place of business is in Wisconsin, diversity is
destroyed.
To ensure that litigants in diversity cases attend care-
fully to the dual citizenship of corporations, our Circuit Rule
28(a)(1) requires the jurisdictional statement in a diversity
case to specify both the state (or other jurisdiction) in which
a corporate party is incorporated and the state in which its
principal place of business is located. The appellants’
jurisdictional statement violates our rule but more remark-
ably it does not so much as mention the second defendant,
the Tokio Marine & Fire Insurance Company.
The appellees’ jurisdictional statement begins promisingly
by stating that the appellants’ jurisdictional statement “is
neither complete [n]or correct.” But neither, it turns out, is
the appellees’. It does not mention the amount in contro-
versy, erroneously alleged in the appellants’ statement; and
concerning citizenship it violates Rule 28(a)(1) by stating
that the appellees are “citizens of a different state” from the
appellants, without indicating what state they are citizens
of. It turns out that the insurance company is actually a
citizen of a foreign country, so that the relevant provision of
No. 05-4577 3
the diversity statute, unmentioned in either jurisdictional
statement, is 28 U.S.C. § 1332(a)(2).
We asked the parties to submit supplemental jurisdic-
tional statements. The appellants’ supplemental state-
ment corrects the omission of Mazda’s principal place of
business (also California), but blunders with respect to the
insurance company by stating that it is “a corporation
organized under the laws of Japan with a United States branch
domiciled in the State of New York with its principal place of
business located at 230 Park Ave, New York, NY 10169”
(emphasis added). The location of a branch office
is irrelevant to diversity jurisdiction. But reference to
“domicile” and “principal place of business” naturally
raises the question, unaddressed in the statement, wheth-
er this branch might be a corporation having its principal
place of business in New York but incorporated else-
where, such as Wisconsin. We might have expected the
blunder to be corrected by the major Chicago law firm
representing the appellees. No such luck. Its supplemen-
tal jurisdictional statement repeats that the insurance
company “is a foreign corporation organized under the laws
of Japan with a U.S. Branch. The principal place of business
of the U.S. Branch is New York, New York.” The fact that
“Branch” is capitalized and its principal place of business
alleged suggests that it might be a corporation, but at
argument the appellees’ lawyer said no, it’s just a branch.
When asked by one of the judges why then it was men-
tioned in the jurisdictional statement, the lawyer replied
inconsequently that “with a U.S. Branch” is Japanese
corporate lingo.
The appellees’ supplemental jurisdictional statement
contains two further errors. It says that the amount in
controversy “allegedly” exceeds $75,000. Actually, as we
know, the amount in controversy in the appellants’ jurisdic-
4 No. 05-4577
tional statement is $75,000, not $75,000 plus. In addition, the
use of the words “alleged” or “allegedly” in this connection
is erroneous. The amount in controversy in a diversity case
is the stakes that the plaintiff or defendant alleges, and
provided the allegation is not false to a “legal certainty” the
amount is taken as true for purposes of jurisdiction. E.g., Mt.
Healthy City School District Board of Education v. Doyle, 429
U.S. 274, 276-77 (1977). In other words, “When the com-
plaint includes a number, it controls unless [the plaintiff’s]
recovering that amount [in the litigation] would be legally
impossible.” Rising-Moore v. Red Roof Inns, Inc., 435 F.3d 813,
815-16 (7th Cir. 2006). The appellees’ use of “allegedly”
suggests an inclination to question whether the amount in
controversy exceeds the jurisdictional minimum, but they
do not pursue the point.
We are satisfied that the parties’ errors in regard to the
amount in controversy are harmless, given the severity
of the injuries alleged. Besides unpleasant medical treat-
ments for Mrs. Smoot that included her having to
wear an orthopedic repositioning appliance on her jaw,
she claims to have sustained permanent injuries consist-
ing of TMJ pain, clicking, popping, and inability to open her
mouth fully and eat and chew all varieties of foods, perma-
nent scarring, and humiliation at work because she is a
customer service representative and her injuries prevent her
from speaking normally. (Her husband’s claim is for loss of
consortium.) We conclude that the district court had
jurisdiction.
But the lawyers have wasted our time as well as their own
and (depending on the fee arrangements) their clients’
money. We have been plagued by the carelessness of a
number of the lawyers practicing before the courts of this
circuit with regard to the required contents of jurisdic-
No. 05-4577 5
tional statements in diversity cases. See, e.g., BondPro
Corp. v. Siemens Power Generation, Inc., No. 05-3077, 2006 WL
2972108, at *1 (7th Cir. Oct. 19, 2006) (per curiam), and cases
cited there; Hicklin Engineering, L.C. v. Bartell, 439 F.3d 346,
348 (7th Cir. 2006); Wild v. Subscription Plus, Inc., 292 F.3d
526, 528 (7th Cir. 2002). It is time, as we noted in BondPro,
that this malpractice stopped. We direct the parties to show
cause within 10 days why counsel should not be sanctioned
for violating Rule 28(a)(1) and mistaking the requirements
of diversity jurisdiction. We ask them to consider specifi-
cally the appropriateness, as a sanction, of their being
compelled to attend a continuing legal education class in
federal jurisdiction. E.g., In re Maurice, 69 F.3d 830, 832, 834
(7th Cir. 1995); DiPaolo v. Moran, 407 F.3d 140, 144, 146 (3d
Cir. 2005); In re Dragoo, 186 F.3d 614, 615-16 (5th Cir. 1999).
Are we being fusspots and nitpickers in trying (so far with
limited success) to enforce rules designed to ensure that
federal courts do not exceed the limits that the Constitution
and federal statutes impose on their jurisdiction? Does it
really matter if federal courts decide on the merits cases that
they are not actually authorized to decide? The sky will not
fall if federal courts occasionally stray outside the proper
bounds. But the fact that limits on subject-matter jurisdic-
tion are not waivable or forfeitable—that federal courts are
required to police their jurisdiction—imposes a duty of care
that we are not at liberty to shirk. And since we are not
investigative bodies, we need and must assure compliance
with procedures designed to compel parties to federal
litigation to assist us in keeping within bounds. Hence Rule
28 and hence the responsibility of lawyers who practice in
the federal courts, even if only occasionally, to familiarize
themselves with the principles of federal jurisdiction. It
would be delightful, but irresponsible in the extreme, for us
to ignore the limits on our jurisdiction, forget the rules
6 No. 05-4577
intended to prevent us from ignoring those limits, direct the
Clerk of the court to tear out the parties’ jurisdictional
statements before distributing the briefs to us, and jump
directly to the merits of any case that the parties would like
to litigate in federal court.
To the merits, at long last. Mrs. Smoot was driving her
one-year-old Mazda at 35 to 40 m.p.h. when she struck
either a chunk of asphalt that had been dislodged from
the pavement (her current version) or, more likely, a
large pothole (the defendants’ version—but also what
Mrs. Smoot told the police officer who investigated the
accident). Deployment of the airbags was triggered by the
collision, causing the injuries of which she complains. The
day before the accident she had received a notice from
Mazda that there was “an increased risk of airbag de-
ployment in a low speed crash or minor impact to the
undercarriage” in the model that Mrs. Smoot was driving,
and that the owner should contact a Mazda dealer to
have the airbag control unit reprogrammed. Her husband
had made an appointment with the dealer for a few
days later—too late.
The windshield and front left wheel and tire of the
car were damaged in the accident, apparently from the
impact with whatever it collided with—asphalt or pot-
hole. Photographs were taken, which of course did not show
the airbag mechanism. The car was repaired and sold before
the lawsuit and cannot be traced.
The Smoots’ lawyer wanted to base their case on the
venerable common law doctrine of res ipsa loquitur (the
thing speaks for itself). A plaintiff who establishes that the
accident in which he was injured was of a kind that
could not reasonably have been expected to occur unless the
injurer had been negligent has made out a prima facie case
No. 05-4577 7
of tort liability, which is to say has presented enough
evidence to withstand a directed verdict or equivalent—
enough in other words to get his case to a jury. E.g.,
Lambrecht v. Estate of Kaczmarczyk, 623 N.W.2d 751, 761 (Wis.
2001); Peplinski v. Fobe’s Roofing, Inc., 531 N.W.2d 597, 600
(Wis. 1995).
Canonical statements of the doctrine, in Wisconsin as
elsewhere, require that the defendant have had exclusive
control of whatever it was that caused the accident. If
taken literally, this would bar applying the doctrine to a
products liability case, as this case is, since “unlike an
ordinary accident case the defendant in a products case
has parted with possession and control of the harmful object
before the accident occurs.” Welge v. Planters Lifesavers Co.,
17 F.3d 209, 211 (7th Cir. 1994). But as we went on to
explain, “the doctrine [of res ipsa loquitur] instantiates the
broader principle, which is as applicable to a products case
as to any other tort case, that an accident can itself be
evidence of liability.” Id. Welge was a case governed by
Illinois law, not as here by Wisconsin law. But Wisconsin
too allows the doctrine to be applied in a products case as
long as the product defect that is claimed to have caused the
accident existed before the defendant shipped the product
rather than being created by tampering or use after he
parted with it. E.g., Hoven v. Kelble, 256 N.W.2d 379, 383-84
(Wis. 1977); Gierach v. Snap-On Tools Corp., 255 N.W.2d 465,
467 (Wis. 1977).
The defendant can contest the prima facie case with
evidence that this particular accident could and did occur
without negligence on his part, but unless the defendant’s
evidence is conclusive the jury will have to weigh it
against the general probability that established the prima
facie case. Turk v. H.C. Prange Co., 119 N.W.2d 365, 370 (Wis.
8 No. 05-4577
1963). An older view was that if the defendant presented
evidence, the presumption of liability created by evidence
of res ipsa loquitur evaporated. Bollenbach v. Bloomenthal, 173
N.E. 670, 672-73 (Ill. 1930), overruled by Metz v. Central
Illinois Electric & Gas Co., 207 N.E.2d 306 (Ill. 1965); see
also Spaulding v. Chicago & Northwestern Ry., 33 Wis. 582, 591
(1873). That view was unsound, e.g., Metz v. Central Illinois
Electric & Gas Co., supra, 207 N.E.2d at 307, and has long
been rejected by the Wisconsin courts. Lipsky v. C. Reiss Coal
Co., 117 N.W. 803, 804 (Wis. 1908); see also Weggeman v.
Seven-Up Bottling Co., 93 N.W.2d 467, 472 (Wis. 1958); Wood
v. Indemnity Ins. Co. of North America, 76 N.W.2d 610, 613-14
(Wis. 1956). The presumption created by res ipsa loquitur is
not a device for forcing the defendant to present evidence,
if he has any; it is, rather, the acknowledgment of a prob-
ability (what statistical theorists call a “prior probability”)
that the accident was due to the defendant’s negligence.
That probability is weakened, but not necessarily to the
point of extinction, by contrary evidence presented by
the defendant, though the probability is not so great that
it entitles the plaintiff to a directed verdict if the defen-
dant presents no evidence. So really the term “presumption”
is a misnomer as applied to res ipsa loquitur and should be
replaced by “permissible inference of negligence”—as the
Wisconsin cases have done. E.g., Peplinski v. Fobe’s Roofing,
Inc., supra, 531 N.W.2d at 599; American Family Mutual Ins.
Co. v. Dobrzynski, 277 N.W.2d 749, 754 (Wis. 1979).
Turning to the specific issue presented by the appeal,
we agree with the plaintiffs that in a proper case of res
ipsa loquitur the plaintiff does not, at least initially, have
to present expert testimony; it may be obvious to judges and
jurors that the accident that befell him is the kind that rarely
occurs without negligence on the part of the injurer. E.g.,
Lambrecht v. Estate of Kaczmarczyk, supra, 623 N.W.2d at 760
No. 05-4577 9
n. 14; Peplinski v. Fobe’s Roofing, Inc., supra, 531 N.W.2d at
601. A typical example is where the plaintiff is discovered
after his appendectomy to have a surgeon’s sponge where
his appendix was. Francois v. Mokrohisky, 226 N.W.2d 470,
473 (Wis. 1975); Utica Mutual Ins. Co. v. Ripon Cooperative,
184 N.W.2d 65, 67 (Wis. 1971). This would be a similar case
had the airbags deployed when Mrs. Smoot parked her car
and turned off the ignition, or when while driving steadily
she had blown the car’s horn. Lawson v. Mitsubishi Motor
Sales of America, Inc., No. 05-CC-0257, 2006 WL 2548769 (La.
Sept. 6, 2006); cf. Edwards v. Ford Motor Co., 934 So. 2d 221,
223-24 (La. App. 2006).
Expert testimony on behalf of the plaintiff in a case based
on res ipsa loquitur might seem mandatory (and this
regardless of the character or strength of the defendant’s
evidence) if the inference of negligence from the accident
itself was obvious only to an expert. Suppose there is no
sponge but when the patient wakes up he discovers that his
right leg is paralyzed. A medical expert might testify that it
was obvious to him (the expert) that the surgeon had sliced
a nerve in the patient’s abdomen rather than that the nerve
had snapped spontaneously. But at this point the doctrine
of res ipsa loquitur would drop out of the case because the
expert’s evidence would have provided a complete explana-
tion of the accident, superseding any inference that might
have been drawn from the accident itself. E.g., Peplinski v.
Fobe’s Roofing, Inc., supra, 531 N.W.2d at 603; Utica Mutual
Ins. Co. v. Ripon Cooperative, supra, 184 N.W.2d at 69;
Fehrman v. Smirl, 131 N.W.2d 314, 318 (Wis. 1964). To
instruct the jury on res ipsa loquitur in such a case would
merely confuse.
It would be different if all the expert had done had been
to rebut evidence given by the defendant that indeed the
10 No. 05-4577
accident might well have occurred without negligence on
the defendant’s part. Refuting that evidence would just
repel a challenge to the inference created by the accident
itself. Despite this point, the courts are divided over
whether it is ever appropriate to permit expert testimony to
be given to bolster the plaintiff’s invocation of res ipsa
loquitur, Connors v. University Associates in Obstetrics &
Gynecology, Inc., 4 F.3d 123, 127 (2d Cir. 1993). But Wiscon-
sin, consistent with its view that the function of res ipsa
loquitur is just to identify a ground for an inference of
negligence, allows the plaintiff to present expert testi-
mony to show that such an injury would indeed, despite
what the defendant may have tried to show, not ordinarily
occur in the absence of negligence. E.g., Lambrecht v. Estate
of Kaczmarczyk, supra, 623 N.W.2d at 760 n. 14; Peplinski v.
Fobe’s Roofing, Inc., supra, 531 N.W.2d at 601; Kelly v. Hartford
Casualty Ins. Co., 271 N.W.2d 676, 678 (Wis. 1978); Utica
Mutual Ins. Co. v. Ripon Cooperative, supra, 184 N.W.2d at 67-
68.
Although we have been speaking so far of “negligence”
because it is primarily in negligence cases that res ipsa
loquitur is invoked, this is a products liability case and
the issue is not whether the defendant was negligent but
whether its product, namely the car in which Mrs. Smoot
was injured, was defective. However, there need be no
practical difference between a claim that a product was
negligently manufactured and a claim that it has a defect
rendering it unreasonably dangerous, see Mesman v. Crane
Pro Services, 409 F.3d 846, 849-50 (7th Cir. 2005), and so it is
no surprise that, as we have seen, res ipsa loquitur is ap-
plied in products cases. It would make no difference,
so far as application of the doctrine was concerned, if a
car accelerated when the brake was depressed because
No. 05-4577 11
the brake had been manufactured negligently or designed
improperly.
The district judge was correct, however, to reject the
plaintiffs’ attempt to invoke the doctrine in this case, or,
to state the point more practically, was correct to rule
that the plaintiff could not prove a product defect without
expert testimony. What triggers an airbag is not the speed
at which the car is traveling, but the rate of deceleration.
Adnan Shaout & Charles A. Mallon, “Automotive Airbag
Technology Past, Present and Future,” 13 Int’l J. Computer
Applications in Technology 159, 160 (2000); Stefan Duma,
Rodney Rudd & Jeff Crandall, “The Automotive Airbag
System,” Professional Safety, Oct. 1998, pp. 24, 25. By our
rough calculation, if you hit a wall head on while driving at
35 miles per hour and decelerate to zero miles per hour in a
tenth of a second, you’ll want your airbag to deploy because
you’ll have hit the wall with the same force as if you had
fallen from a window 40 feet above the ground. We don’t
know the rate of deceleration of Mrs. Smoot’s car when it hit
the obstacle that triggered the airbag. Even if it was a chunk
of asphalt rather than a pothole, the fact that the front of the
car was damaged suggests rapid deceleration, and one
could not allow a jury to speculate that it was not rapid
enough to trigger a properly controlled airbag. The plaintiffs
concede that a “sudden slowing” in the speed of the car by
only 8 m.p.h. would have triggered a properly controlled
airbag, and we cannot say as a matter of common sense or
common experience that hitting a pothole or a chunk of
asphalt could not cause a “sudden slowing” of the car from
35 to 27 m.p.h. The investigator’s report depicts a pothole
approximately two feet in diameter, though its depth is not
indicated.
By the time the judge ruled against the plaintiffs on res
ipsa loquitur, discovery was closed and the plaintiffs had
12 No. 05-4577
not retained an expert. But the judge gave them time to find
one, and they did. His qualifications to testify about airbags
were poor, but passing that, his study of the accident was so
perfunctory that he quite rightly was barred from testifying.
He flunked all three requirements of Fed. R. Evid. 702—that
the expert’s testimony be “based upon sufficient facts or
data,” that it be “the product of reliable principles and
methods,” and that the expert have “applied the principles
and methods reliably to the facts of the case.” Zenith
Electronics Corp. v. WH-TV Broadcasting Corp, 395 F.3d 416,
418 (7th Cir. 2005).
The plaintiffs’ expert cannot be faulted for not having
inspected the car’s airbag control unit, though his clients can
be. The car should not have been sold or repaired (it was
repaired before it was sold, and the repairs included
replacing the airbag control unit) before the unit was
inspected. And whether or not a “spoliation of evidence”
instruction would have been proper had this case gotten to a
jury, see, e.g., Jagmin v. Simonds Abrasive Co., 211 N.W.2d
810, 821 (Wis. 1973); Estate of Neumann v. Neumann, 626
N.W.2d 821, 841-42 (Wis. App. 2001), the plaintiffs cannot
escape the responsibility for having placed their expert in a
difficult position. Even so, he could have inquired into the
circumstances behind the recall notice, into the results of the
recalls (were the airbag control units found to be defective
in all of the recalled vehicles? Some? None?), and into the
experience of premature deployment of the airbags in Mrs.
Smoot’s Mazda model. He could have tried to infer deceler-
ation from the car’s weight and the damage to it. He did
none of these things. He also did not examine another car of
the same model; interview Mrs. Smoot, the investigating
police officer, or any of the mechanics who repaired the
vehicle; review crash testing data for the model involved; or
review technical specifications or other literature regarding
No. 05-4577 13
the manufacture, design, or functioning of airbag systems in
Mazdas. He offered the naked unsubstantiated opinion that
an airbag should not deploy when the car is traveling at a
speed of only 35 to 40 m.p.h. and hits something unlikely to
have brought the car to a complete and sudden stop—yet
Mrs. Smoot had told the police investigator that the car
had been “severely jolted” by the collision.
Without expert testimony, the plaintiffs were left essen-
tially with the recall notice plus a certain implausibility
in the notion that a properly controlled airbag would deploy
when a car traveling at a relatively low speed hit a chunk of
asphalt (though probably it really hit a pothole). The
plaintiffs have not shared with us the details of the recall.
But according to the documents available at the National
Highway Traffic Safety Administration’s website,
http://www-odi.nhtsa.dot.gov, the percentage of the
recalled Mazdas that turned out to have a defect that would
trigger airbag deployments prematurely is unknown. The
recall covered approximately 214,270 vehicles. NHTSA’s
investigation preceding the recall discovered 88 incidents,
causing a total of 56 injuries. In 2002, Mazda stated that the
complaint rate for improper airbag deployment for the
recalled vehicles had been 14.6 per 100,000 vehicles per year.
These numbers would preclude inferring liability from the
recall alone, which anyway the plaintiffs do not ask us to
do.
A case based on so little evidence gives rise to an inference
that the plaintiffs searched no further because they were
pessimistic that their case had any real merit. The judge was
right to keep the case from reaching a jury.
AFFIRMED.
14 No. 05-4577
EVANS, Circuit Judge, concurring. I join the court’s
opinion—without admissible testimony from a qualified
expert, the plaintiffs’ goose is cooked and the judgment of
the district court must be affirmed. But I decline to join
the court’s stinging criticism of the attorneys regarding their
less-than-perfect jurisdictional statements. Sure, the plain-
tiffs should have said the amount in controversy exceeds
$75,000, not that it is $75,000. And sure, both sides stumbled
on their declarations regarding the dual citizenship of the
corporate defendants. But, at best, these are low misde-
meanors; yet the court treats them like felonies. I would not
label these minor flaws as “blunders,” nor would I come
close to saying this is “malpractice” which must be stopped.
Also I would not issue an order to show cause, and
I certainly would not suggest that an appropriate sanc-
tion might be to compel the lawyers’ attendance at “a
continuing legal education class on federal jurisdiction.”
What happened in this case is not particularly unusual.
The plaintiffs, represented by what appears to be a
small law firm, filed this suit almost five years ago in
state court where jurisdictional requirements are easily
satisfied and rarely questioned. The defendants, represented
by a “national law firm with lawyers in 27 offices coast-to-
coast” (according to the firm’s Web site) removed the case
to federal court. That there is diversity jurisdiction has never
been questioned by anyone, including at least two district
court judges who issued written decisions as the case poked
along for four years through discovery and several in-court
proceedings. The plaintiffs then lose their case on summary
judgment and file an appeal raising the issue that cuts to the
very heart of their suit. Given this situation, when all eyes
are really on the guts of the case, I think we should be more
tolerant of the jurisdictional statement hiccups that have
occurred here.
No. 05-4577 15
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—11-29-06