Summary of a Recent
Judicial Development in
Environmental Law

Product Description Materials Need Not Accompany Product
to Be Labeling for FIFRA Purposes

Eric H. Foy
National AgLaw Center Research Associate

Summary of Decision

In Indian Brand Farms, Inc. v. Novartis Crop Protection, Inc., No. 99-2118, 2007 WL 4571087 (D.N.J. Dec. 20, 2007), the United States District Court for the District of New Jersey granted Defendant's motion for partial summary judgment based on Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) preemption, and dismissed Defendant's partial motion for summary judgment regarding Plaintiffs' negligent misrepresentation claim as moot. Plaintiffs brought suit contending that chemicals manufactured by Defendant damaged their blueberry plants and crops.

Background

Plaintiffs, owners and operators of New Jersey blueberry farms, applied the insecticide Diazinon AG600 WBC to their blueberry fields. Id. at *1. Following the applications, they began to notice damage to the blueberry plants that were sprayed with the insecticide. Id. The blueberry plants not sprayed with insecticide exhibited no signs of damage. Id. The insecticide was "formulated, manufactured, and marketed" by Defendant. Id. After discovering the damages, Plaintiffs reported them to Defendant. Id. As the growing season progressed, Plaintiffs noticed damages to the fruit of the insecticide-sprayed bushes. Id. at *2. They hired an investigator to examine and document the damages. Id. Dr. Lapp, a representative for Defendant, also visited Plaintiffs' farms to review their claims. Id. Plaintiffs alleged that Lapp convinced them not to hire an attorney and not to bring suit until the crop year had concluded. Id. Additionally, Lapp, on behalf of Defendant, entered into settlement agreements with several of the Plaintiffs. Id. The language of the agreements purportedly extinguished Plaintiffs' rights to seek further damages "'arising out of any damage or loss, present or future, to crops, plants, animals, fish or land, direct or indirect, known or unknown allegedly sustained by the [settling plaintiff] as a result of the use of [Diazinon AG600].'" Id. Nowhere in the agreement did Defendant admit liability for the damages. Id.

The next spring, Plaintiffs discovered continuing damages to their blueberry plants from Defendant's insecticide. Id. Plaintiffs submitted damage reports to Defendant for the continuing damages, but Defendant denied their compensation request for continued damages. Id. Thereafter Plaintiffs brought suit. Id.

Arguments

Defendant argued that "Plaintiffs signed a Release concurrent with taking certain sums in settlement of this claim after evaluating initial damage to the 1997 crops, with the Releases giving up all rights to future damages." Id. at *3. Defendant also argued that Plaintiff's claims were preempted by FIFRA. Id.

Plaintiffs "sought to avoid the Releases by asserting that Defendant fraudulently induced them into signing." Id. Additionally, Plaintiffs brought actions sounding in strict products liability, negligence, breach of covenant of good faith and fair dealing, and breach of express warranty. Id. Plaintiffs claimed their actions were based on the insecticide's brochure, not on the product itself. Id.

Analysis and Holdings

The court first addressed Plaintiffs' negligent misrepresentation and consumer fraud claims. Although the Third Circuit Court of Appeals directed dismissal of "claims [for] negligent misrepresentation [and] fraud . . . if the written materials relied upon by Plaintiffs [fell] within the definition of 'labels' or 'labeling' under FIFRA," Plaintiffs in the instant case responded by alleging that their claims were based on Defendant's representations made in the product's brochure, not on the product label itself. Id. at *5. Because the brochure did not accompany the product when it was delivered, Plaintiffs argued that it did not qualify as labeling. Id. However, the instant court held that "the term 'accompany' contained in the definition of 'labeling' in FIFRA [did] not command spatial or temporal proximity to the product." Id. at *6. For this reason, and because the brochure was consistent with the product's label, the court held that Plaintiffs' labeling claims were preempted by FIFRA. Id. at *7. Additionally, by finding that the brochure constituted labeling, Plaintiffs' failure-to-warn claims were also preempted by FIFRA. Id. at *8.

The court then addressed Plaintiffs' strict liability, negligent testing, and breach of express warranty claims. Because the court had already ruled that Plaintiffs' failure-to-warn claims were preempted by FIFRA, Plaintiffs had to base their additional claims on defective manufacture or design. Id. at *9-10. Ultimately the court held that "Defendant [] made a merit-based attack on Plaintiffs' claims of defective design and negligence, asserting that Plaintiffs [] failed to come forward with any credible evidence of product defect or negligence on the part of Defendant." Id. at *10. However, the court did not dismiss Plaintiffs' design defect claim because Defendant's motion to dismiss did not refer to it by name. Id.

The case was decided on December 20, 2007.