In Indian Brand Farms Inc. v. Novartis Crop Protection Inc., the 3rd Circuit Court of Appeals gave the green light to blueberry farmers to continue with their suit for negligent misrepresentation, fraud and products liability against a pesticide manufacturer, Novartis Crop Protection, Inc. (yes, they make pesticides too). In their lawsuit the farmers argued that the new version of Novartis’ Diazinon pesticide, AG600, when mixed with the fungicides Captan and Captec, caused blotches, depressions and spots on their plants, and even killed some of them. As reported by Courthouse News Services, the pesticide included a surfactant, meant to improve the consistency, that reacted badly with the fungicides. The farmers argued that Novartis failed to adequately warn them and in fact, led them to believe otherwise when Novartis’ promotional brochure failed to mention the fungicide reaction.
Novartis’ attempt to get the suit dismissed by arguing that the farmers claims were preempted by Novartis registering its pesticide with Environmental Protection Agency (“EPA”), as is required by the Federal Insecticide, Fungicide and Rodenticide Act (“FIFRA”), failed. Had the 3rd Circuit accepted Novartis’ argument, the farmers’ case against the company would not have been able to go forward.
FIFRA requires that all pesticides be registered with the EPA and as such, certain GMOs are also regulated by the statute. Read more on EPA’s regulation of GMOs under FIFRA here.
New Jersey claims blueberries as its official state fruit. According to the National Agricultural Statistics Service, the state is 3rd largest producer of blueberries with 59 million pounds of berries produced on 7,700 acres. The overall value of value of the blueberry crop from New Jersey reached 90.2 million dollars at its peak in 2007.
Here’s the legal skinny on the decision.
On appeal, the 3rd Circuit neatly dismissed Novartis’ preemption argument when it concluded that the farmers’ claims of fraud and negligent misrepresentation were not based on any alleged flaws in the federally regulated warning label. Instead, the 3rd Circuit held that the farmers were complaining about alleged misrepresentations in Novartis’ marketing brochure and not labels. As such, state law, rather than federal, applied to the case, allowing the farmers to proceed with their suit. Writing for a 2-1 majority, Judge Walter K. Stapleton found that a manufacturer’s brochure “does not qualify as ‘labeling’ under FIFRA,” and that U.S. District Judge Joseph H. Rodriguez of the District of New Jersey had therefore erred in holding that the claims were preempted.
The 3rd Circuit also decided that in addition to the fraud and misrepresentation claims, the farmers should be allowed to pursue two products liability claims — design defect and failure to warn — because those, too, would not be preempted by FIFRA. Judge Stapleton, joined by Judge D. Michael Fisherwrote, wrote:
Given that Congress in FIFRA imposed a generalized duty to include in one’s labeling any warning statement necessary to protect plant life and the fact that the EPA has not seen fit to narrow that duty, we find no basis for concluding that New Jersey law imposes a duty to warn different than or in addition to the scope of the requirement imposed by FIFRA.
On their products-liability claim, the farmers argued that the practice of tank mixing pesticides and fungicides was both a common one and well known to Novartis, an argument that did not convince Judge Thomas M. Hardiman who dissented in part in the case. Judge Thomas M. Hardiman wrote that he would have upheld the dismissal of the products liability claims because the farmers’ decision to “tank mix” the Novartis pesticide with two other chemicals was not a “foreseeable use,” a necessary element in a products liability suit. Allowing such claims, Hardiman said, would effectively force Novartis to test its product for compatibility with other manufacturers’ products — a result that Hardiman said is “both unfair and unsound as a matter of public policy.” But the majority of the Court sided with the farmers, finding that the “evidence is sufficient for a jury to conclude that tank mixing pesticides and fungicides was a reasonably foreseeable practice.”
The battle field is now demarcated, as the farmers will take on the chemical company as they proceed with their case at the District Court level.