Faegre Drinker on Products

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District of New Jersey Finds Amazon to be “Seller” of Hoverboard under NJ Product Liability Act

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The District of New Jersey has held that Amazon may be sued under New Jersey law for defective products sold by third-party sellers through its online marketplace.

The dispute in New Jersey Manufacturers Insurance Group v. Amazon.com Inc., Civil Action No. 16-cv-9014, involved an allegedly defective hoverboard purchased from a third-party seller by an insured of plaintiff New Jersey Manufacturers Insurance Group (“NJM”) via Amazon.com.  NJM filed suit as subrogee of the insured, asserting a strict lability claim under the New Jersey Product Liability Act (NJPLA), in addition to claims for breach of implied warranty and negligence.

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District of Delaware Chief Judge’s New Standing Order Requires Disclosure of Third-Party Litigation Funding

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The District of Delaware is the latest in a series of courts to require disclosure of third-party funding arrangements, a subject we have previously explored. The Chief Judge in the District of Delaware now joins other courts like the District of New Jersey and the Northern District of California in requiring these disclosures.

On April 18, 2022, Chief District Judge Colm F. Connolly of the United States District Court for the District of Delaware issued a standing order requiring litigants to disclose whether their cases are being financed by third parties. The standing order requires that, “where a party has made arrangements to receive from a person or entity that is not a party (a ‘Third-Party Funder’) funding for some or all of the party’s attorney fees and/or expenses to litigate th[e] action on a non-recourse basis,” either for “a financial interest that is contingent upon the results of the litigation” or “a non-monetary result that is not in the nature of a personal loan, bank loan, or insurance,” the party must disclose certain details of the funding relationship within 45 days of the entry of the standing order (i.e., by June 2, 2022) for existing cases, or within 30 days of the filing of an initial pleading or transfer of a new matter into the District.

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Cybersecurity Safeguard Implemented by Superior Court of New Jersey for OUS Web Traffic

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Last year, we explored the Federal Judiciary’s new safeguards and procedures to protect sensitive court records in light of the SolarWinds Orion cybersecurity breach.  Now, as a result of increased hostilities between Russia and the United States, the New Jersey Judiciary is taking steps to ramp up cybersecurity by blocking web traffic from outside the United States.

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Tenth Circuit Affirms Dismissal of Pet Food False Ad Proposed Class Action

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The Tenth Circuit recently affirmed dismissal of a proposed class action against a dog food manufacturer, finding that the putative class claims were nonactionable puffery and overly subjective.

In Renfro, et al. v. Champion Petfoods USA, Inc., et al., No. 20-1274, pet owner plaintiffs brought a proposed class action against Champion Petfoods alleging that the packaging for some of its dog food brands were false and misleading. Specifically, plaintiffs asserted claims for violation of the Colorado Consumer Protection Act, breach of express and implied warranty, fraudulent misrepresentation, fraudulent concealment, unjust enrichment, and negligence.

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Eastern District of Virginia Denies Motion to Certify Class, Sheds Light on Rule 23(b)(3) Predominance and Superiority Requirements for Class Actions

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The U.S. District Court for the Eastern District of Virginia analyzed Federal Rule of Civil Procedure 23(b)(3)’s predominance and superiority requirements for class actions in a recent decision denying a motion to certify a purported class of motor vehicle purchasers.  The decision underscores that plaintiffs seeking to certify classes asserting claims that will render the process of identifying class members to be a mere series of individualized inquiries will not pass muster under Rule 23.

The Facts in Dispute

Garcia, et al. v. Volkswagen Group of America, Inc., et al. involved a purported class of plaintiffs residing in multiple states who purchased vehicles manufactured by defendants within the last 14 years.  The plaintiffs sued a group of auto manufacturers alleging damages resulting from defendants’ alleged fraudulent misrepresentations about the vehicles, and asserting claims for violations of the Federal Odometer Act, fraud, breach of contract, and unjust enrichment, in addition to state law claims under the laws of California, Colorado, Florida, Illinois, New Jersey, and Washington.

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Pennsylvania Rejects Corporate Registration as Basis for Personal Jurisdiction

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A recent Pennsylvania Supreme Court opinion provides out-of-state corporations more protection from litigation tourists, bringing the state’s general personal jurisdiction rules in line with U.S. Supreme Court precedent. In Mallory v. Norfolk Southern Railway Co., a unanimous court invalidated part of Pennsylvania’s corporate registration statute, holding that corporations that are not incorporated and do not have a principal place of business in Pennsylvania cannot be subject to general personal jurisdiction simply because they have registered to conduct business in the Commonwealth.

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