Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—D. Conn.: Claims against spray foam manufacturer time-barred, (Oct 29, 2014)

By Kathleen Bianco, J.D.

Unfair trade practice claims against the installer and manufacturers of spray foam insulation were dismissed because they were not filed in a timely manner, a federal district court in Connecticut ruled in a decision that also rejected a motion to dismiss a product liability act claim by one of the manufacturers because genuine issues of material fact existed related to that claim (Beyer v. Anchor Insulation Co., Inc., October 28, 2014, Arterton, J.).

Background. Homeowners Richard and Monica Beyer hired Anchor Insulation to install spray polyurethane foam (SPF) insulation in the attic, basement, and undercarriage of their home in Niantic, Connecticut. The SPF used in the basement and undercarriage was manufactured by Johns Manville, Inc., and the SPF used in the attic was manufactured by Icynene Corp. Shortly after installation, the Beyers noticed that the insulation was emitting noxious and harmful fumes, gases, and odors, causing the homeowners to suffer from severe headaches, burning of the skin and eyes, heart palpitations, and/or irregular heartbeats, and difficulty breathing. The conditions exacerbated Mr. Beyer’s preexisting asthma.

Environmental testing revealed that both the Johns Manville and Icynene products were defective because they emitted toxic gases and chemicals into the home. The Beyers then engaged Anchor to remove the insulation from their home, which resulted in further contamination. The Beyers filed suit against Anchor, Johns Manville, and Icynene asserting various product liability and unfair trade practices claims. All three defendants moved to dismiss the claims under the Connecticut Unfair Trade Practices Act (CUTPA) arguing that the claims were barred by the Connecticut Products Liability Act’s exclusivity provision and the statute of limitations. Furthermore, Johns Manville filed a motion to dismiss the Connecticut Products Liability Act (CPLA) claims filed against it, asserting that the homeowners failed to alleged that “the product was expected to and did reach the consumer without substantial change in condition,” a required element of a strict-liability claim.

Connecticut Unfair Trade Practices Act. The homeowners’ unfair trade practices claims were time-barred under the applicable three-year statute of limitations because the original complaint, which was filed one day before the limitation period ran out, did not include any claims that were not precluded by the CPLA. Only CUTPA claims that assert a financial injury escape the exclusivity provision of the CPLA. Although the homeowners’ amended complaint had alleged financial injuries not precluded by the CPLA, those claims did not relate back to the original complaint; therefore, they were time-barred. Accordingly, the motions to dismiss the CUTPA claims by the installer and the manufacturers were granted.

Connecticut Products Liability Act. Johns Manville contended that it was not liable in strict liability for the homeowners’ damages because its product was altered or modified by the installer. Under the CPLA generally, a manufacturer will not be liable in strict liability for a product defect if its product was altered or modified by a third party; however, this limitation does not apply if the alteration or modification was in accordance with the instructions or specifications of the product’s seller; was made with the consent of the product’s seller; or was the result of conduct that reasonably should have been anticipated by the product’s seller. The homeowners claimed that the alteration to the product was made at the direction and under the instructions of the manufacturer. The foam insulating material is formed when two liquids come together at the tip of a spray gun and combine to form expanding foam, which is then sprayed into spaces where insulation is needed. Because questions of fact existed regarding whether the installer had properly followed the manufacturer’s instruction when preparing the product, dismissal of the claim in favor of the manufacturer was not warranted.

The case number is 3:13cv1576 (JBA).

Attorneys: Dawn Marie Smith (Clinesmith Wooten Smith LLP) for Richard Beyer. Beck S. Fineman (Ryan Ryan Deluca, LLP) for Anchor Insulation Company, Inc. Cullen W. Guilmartin (McCarter & English, LLP) for Johns Manville, Inc. Bryan Matthew Abramoske (Cetrulo LLP) for Icynene Corp.

Companies: Anchor Insulation Company, Inc.; Johns Manville, Inc.; Icynene Corp.

Cases: StateUnfairTradePractices ConnecticutNews