On December 16, 2021, the Massachusetts Supreme Judicial Court (SJC) issued its decision in Ofer Nemirovsky v. Daikin North America, LLC (SJC-13108.)
PLAC submitted an amicus brief in support of member Daikin North America, LLC on the issue of whether the component parts doctrine bars a contract-based claim for breach of the implied warranty of merchantability of a non-defective component. The SJC agreed with PLAC’s argument that a manufacturer, distributor or seller of a non-defective component is not liable for damage caused by a defect in the integrated product.
Plaintiff experienced issues with his Daikin-brand HVAC system which was designed, manufactured, sold and installed by corporate entities other than Daikin NA, which only sold replacement parts to Plaintiff. Plaintiff asserted claims against defendants for breach of express warranty, breach of the implied warranty of merchantability, intentional and negligent misrepresentation and violation of M.G.L. c. 93A.
The Court also addressed other issues PLAC raised in its amicus brief, including that the district court improperly held J&J responsible for harm allegedly caused by opioids sold by other companies. In addition, the Court recognized a manufacturer lacks control over its product once sold, noting a “product manufacturer’s responsibility is to put a lawful, non-defective product into the market. There is no common law tort duty to monitor how a consumer uses or misuses a product after it is sold.”
Following motions for summary judgment, only Plaintiff's claims for breach of the implied warranty of merchantability, misrepresentation, and violation of M.G.L. c. 93A were allowed to proceed to trial. The jury held Daikin NA liable for $10 million even though plaintiff’s own expert testified defects elsewhere in the HVAC system - for which Daikin NA was not responsible - caused the replacement parts (sold to Plaintiff for less than $9,000) to fail prematurely.
Daikin NA filed a motion for judgment notwithstanding the verdict and a motion for a new trial or remittitur. Both motions were denied and Daikin NA appealed.
The SJC granted Daikin NA's application for direct appellate review, reversed the trial court's decision, and remanded for reconsideration of damages on the tort claim. The SJC concluded that given
the absence of evidence of any defect in the coils Daikin NA distributed, the component parts doctrine precluded Plaintiff's breach of warranty claim against Daikin NA.
The SJC's decision extended tort-based component parts doctrine to UCC merchantability claims for purely economic loss. It adopted the position PLAC urged that the component parts doctrine applies to non-standalone components that have no functional capability unless integrated into other products, to specialized components that are designed only for use in an integrated product, and to both tort and warranty claims.
In its decision, the SJC acknowledged the amicus brief submitted by PLAC.
A copy of the SJC's decision and PLAC’s brief, authored by James M. Campbell
and Christopher R. Howe
(Campbell Conroy & O'Neil, PC), are available for download below.
View PLAC’s Brief
View the Court’s Opinion