Motion 6 - product liability plaintiffs response to 615 motion - Part 2
A. THE PLAINTIFF'S FIRST AMENDED COMPLAINT SATISFIES ILLINOIS LAW AND RULES OF PLEADING.
As demonstrated above, the allegations in Plaintiff's First Amended Complaint clearly state a claim upon which relief can be granted as against defendant FEMA. FEMA is on sufficient notice to file an answer and should be required to do so.
1. Fraudulent Actors Always Hide Their Fraud, and the Law Does Not Exist to Reward That Concealment
FEMA's proposed interpretation of fraudulent concealment law is at odds with Illinois law and common sense. Under FEMA's view, Plaintiff could never plead a fraudulent concealment claim short of an outright confession. Such is not the law. The heightened particularity requirement does not, and should not, render such claims impossible to plead and, thus, de facto eliminate the cause of action altogether from Illinois jurisprudence.
FEMA argues that Plaintiff's First Amended Complaint fails to adequately plead the elements of duty, actual knowledge and concealment, and reliance. It also generally argues that plaintiff's detailed First Amended Complaint is somehow sparse and conclusory. A simple review of the actual pleading refutes these accusations.
It must be remembered that at its heart, this case is about deceit and cover-up; terms that might be used in concert with “fraud” and “concealment.” The Illinois Supreme Court reaffirmed the notion that a plaintiff need not plead facts with precision when the information needed to plead those facts is within the knowledge and control of the defendant rather than the plaintiff in Bryson v. News America Publications, Inc. , 672 N.E.2d 1207, 1224-25 (Ill. 1996). Although not a fraudulent concealment case, the Illinois Supreme Court had to consider whether the plaintiff's punitive damage count sufficiently plead facts that constituted “actual malice” which, like concealment cases, requires a heightened pleading standard. See Bryson, 762, N.E.2d at 1224-25. The Illinois Supreme Court also noted that this “rule assists plaintiff who may be unable to discover the information needed to draft a detailed complaint before bringing an action. . . . This rule also recognized that, where the defendants have most of the pertinent information in their possession, they do not have to rely primarily on the facts stated in the complaint to formulate an answer and prepare for trial, since they can easily determine the specific details for themselves... Accordingly, in such cases, the plaintiff can state the material facts in the complaint with less specificity than would normally be required.” Bryson, 762, N.E.2d at 1225 (cases omitted).
Here, FEMA cannot realistically claim that Mr. Solis' alleged lack of factual detail hinders its ability to prepare an answer or a defense in this case. See Bryson, 762, N.E.2d at 1225, citing Duhl v. Nash Realty Inc. , 429 N.E.2d 1267 (Ill. App. Ct. 1981) (where complaint alleged fraudulent misrepresentation by a real estate broker, allegation that defendant acted intentionally with reckless disregard for the truth was sufficient). See also Lozman v. Putman , 767 N.E.2d 805 (Ill. App. 2002) (relying on and citing Bryson with approval) (“Plaintiffs can state the material facts with less specificity than normally would be required and the pleadings will not be considered to be bad in substance if it reasonably informs defendants of the nature of the claim they must meet.”)
In the instant case, FEMA is certainly apprised of the specific claims it is required to answer, to wit:
• It knew that butter flavoring and diacetyl was dangerous to workers like Gerardo Solis;
• It, along with the other named defendants - companies that came together to form FEMA - intentionally and maliciously concealed that information from not only the medical community and the public in general, but from the very people that made the products its member companies sold, including Gerardo Solis;
• And because FEMA and those other defendants concealed this information from him, Gerardo Solis was severely and permanently injured.
Without question, FEMA knows exactly what matters are involved as alleged in this case. Plaintiff has carefully set forth these factual allegations in its First Amended Complaint. This Court should require FEMA to provide Mr. Solis some answer and offer some defense on the merits, if one exists.
2. Plaintiff Sufficiently Alleged That FEMA Owed Gerardo Solis a Duty to Disclose the Life-Threatening Nature of Butter-Flavoring Chemicals.
Beyond question, Plaintiff sufficiently alleges that FEMA owed a duty to disclose the life-threatening hazards of exposure to butter flavoring and diacetyl. As shown below, Plaintiff has sufficiently alleged a relationship of trust andthat FEMA possessed superior, material knowledge, which created a duty to disclose the known dangers of butter flavoring and diacetyl to Mr. Solis.
a. FEMA had a Relationship of Trust with Gerardo Solis.
As noted above, FEMA cannot argue the evidence in a motion to dismiss. The allegations in Plaintiff's First Amended Complaint already set-forth above, must be taken as true for purposes of a motion to dismiss. These allegations clearly show that a relationship of trust existed between FEMA and the employees of its member companies such as FONA - specifically Gerardo Solis.
In its memorandum, FEMA holds itself out as some independent organization, separated in both technical and practical ways, from its member companies. (FEMA's Memorandum, at p. 5.) That is simply not reality. As alleged in plaintiff's complaint, FEMA was a trade association, made up of food flavoring manufacturers, including defendants Givaudan and International Flavors & Fragrances, Inc. Furthermore, these member companies provided information specifically to FEMA concerning the health risks to workers, including Gerardo Solis, regarding exposure to certain chemicals. And, while FEMA gathered such information, and provided safety education and information in other contexts, it concealed the details of the hazards surrounding bronchiolitis obliterans.
Gerardo Solis did not come from a group of undetermined, unlimited members of the general public; rather he is one of many people on whose backs and hands (and lungs) these companies relied to produce their products. FEMA existed because of the work people such as Gerardo Solis did. FEMA and its members knew that they were causing harm to their employees. They knew they could stop it. And instead, they concealed it, perpetuated it, and cost Gerardo Solis his healthy lungs.
b. FEMA Possessed Superior, Material Knowledge that it Concealed From Gerardo Solis.
FEMA again admits that Plaintiff has alleged that one basis for its duty to disclose was its possession of superior knowledge, yet argues this cannot create a duty. As shown immediately above, the “something more” that FEMA argues must exist to create a duty does exist in this case. FEMA undertook the duty of warning and instructing plant workers of hazards surrounding chemicals and ingredients used in manufacturing - specifically including Givaudan and International Flavors & Fragrances.
Plaintiff alleges that FEMA possessed material “knowledge regarding the health effects of butter flavoring and diacetyl that was superior to Plaintiffs' knowledge ...” (Amended Complaint, ¶100 a.) As already pointed out above, Plaintiff goes to great effort to show this Court in its pleading what FEMA knew, when it knew it, and how. FEMA may strongly refute the allegations and facts, but it should be compelled to do so with evidence at trial, or at a minimum in a summary judgment motion.
Moreover, in Illinois, a party may assume a duty to disclose information accurately by its conduct. See Union Nat Bank and Trust Co. of Joliet v. Carlstrom , 481 N.E.2d 300, 302 (Ill. App. Ct. 1985). The Carlstrom court held that defendant bank assumed a duty to disclose information by voluntarily providing a description of parties' dealings with the bank and, by doing so, undertook a duty not to deliberately conceal or misrepresent. Id. (emphasis added.)
The court in Lilly v. Ford Motor Company also addressed the issue of “trust and confidence” creating a duty to speak. In Lilly a district court applying Illinois law concluded that “[w]hile Plaintiffs have not alleged that they were in a fiduciary relationship with Ford, they have adequately pled that they placed trust and confidence in Ford and that Ford was in a position of influence and superiority over them” See Lilly , 2002 WL 84603 at *9 (N.D. Ill. 2002). In Lilly, the complaint alleged that Ford designed and manufactured the vehicle parts and made the decisions about their placement on the engine. Furthermore, the complaint alleged that Ford allegedly withheld information about the safety of the parts from the NHTSA and denied reports that parts failed to the Los Angeles Times. The Court found that these allegations reasonably supported the inference that Ford had the best access to the information and that plaintiffs would not have been able to obtain this information through diligence. See Lilly , 2002 WL 84603 at *9.
Plaintiff's allegations, taken as true, are similar to those facts found to create a duty under Carlstrom and Lilly. Moreover, outside jurisdictions, under similar circumstances, have found existing duties on the part of trade associations. See Arnstein v. Manufacturing Chemists Association, Inc. , 414 F.Supp. 12 (E.D. Pa. 1976) (Court dismissed trade association's motion to dismiss finding that the trade association could be held liable on the basis that it had voluntarily undertaken to render services by conducting a symposia and committee studies).
Here, FEMA conducted the March of 1997 Conference entitled, “Respiratory Safety in the Flavor and Fragrance Workplace,” a conference allegedly aimed at providing critical information on the nature of potential respiratory hazards in the flavor and fragrance workplace. (See 1st Am. Complaint at ¶ 13.) FEMA also voluntarily drafted language contained within members' material safety data sheets and took on the responsibility for declaring what chemicals are safe (GRAS) to be used in products sold by FEMA members. (See 1st Am. Complaint at ¶ 93.)
With apparent disregard for the detailed allegations in Plaintiffs' complaint, FEMA argues Plaintiff has pled no facts that would justify an inference of any relationship whatsoever between Mr. Solis and FEMA. As it does throughout its supporting memorandum, FEMA actually argues the strength of Plaintiff's evidence, not the sufficiency of his pleadings.
In making the commitments to worker safety outlined above, and distributing other safety concerns and product safety information, FEMA voluntarily undertook the duty to also disclose all the dangers associated with its members' butter flavoring products as it discovered them. It owed that duty to the people that information was most likely to protect-workers being exposed to these chemicals, specifically Geraldo Solis. FEMA's failure to disclose its knowledge of the hazards associated with its members' butter flavorings increased the risk of harm to Mr. Solis, who relied on FEMA's duty to disclose, and in fact did cause and/or contribute to cause Mr. Solis' respiratory illness.
3. Plaintiff Has More than Adequately Alleged that FEMA Fraudulently Concealed Information that, if Disclosed. Could have Saved Gerardo Solis' Lungs
Plaintiff alleges specific meetings with FEMA representatives John Hallagan, Danial Thompson and Richard Hall, wherein FEMA was informed by Defendant Givaudan that employees had been diagnosed with bronchiolitis obliterans, and that one or more chemicals in the workplace may cause this disease. (1st Am. Complaint at ¶ 12.) Plaintiff alleges that in FEMA's 1997 seminar Respitory Safety in the Flavor and Fragrance Workplace, it discussed bronchiolitis obliterans and its causes, and precautions to prevent it, but did not disclose the existence of lung disease at one of its member companies, Defendant Givaudan. ( Id. at ¶ 13.) Plaintiff alleges that FEMA chose not to test for inhalation hazards, despite its other testing and its knowledge of risks discussed above. (Id. at ¶ 96.) Plaintiff alleges that the information provided in FEMA's diacetyl monograph withheld the information it possessed regarding the causes of bronchiolitis obliterans (Id. at ¶94), nor did FEMA include in its FFIDS for diacetyl, any information that diacetyl could cause severe and permanent lung injury. ( Id. at ¶ 97.) Plaintiff alleges that this and other information in FEMA's possession was material. (Id. at ¶ 99.)
No matter the semantic box in which FEMA attempts to squeeze Plaintiff's allegations, this Court must read Plaintiff's First Amended Complaint as a whole and must take all facts as true. When doing so, there is no doubt that Plaintiff has alleged all the elements of concealment sufficiently. FEMA is on notice and should provide an answer.
4. Gerardo Soils Detrimentally Relied on FEMA's Concealment.
In his First Amended Complaint, plaintiff expressly and succinctly alleges: Plaintiff reasonably and detrimentally relied on Defendants' fraudulent concealment by not acting to protect himself from the dangers associated with Defendants' butter flavoring and flavoring chemicals and was reasonably justified in not acting and could not have discovered and/or was prevented from discovering the truth because Defendants created a false sense of security with their concealment and silence. (1st Am. Complaint at 102.)
Defendant FEMA chose to conceal information from Geraldo Solis, and in so doing, prevented him from acting to preserve his health. As a result, he was repeatedly exposed to hazardous chemicals and suffered severe injury. Through its fraud, FEMA robbed Mr. Solis of the opportunity to protect himself, instead allowing him to appear for work (and exposure) at the very facilities to which FEMA was allegedly providing safety information. To argue that Mr. Solis did not detrimentally rely on FEMA's concealment is tantamount to denying his very injuries.
Moreover, justifiable reliance is a fact issue to be decided by a jury. Illinois courts have explicitly held that “justifiable reliance is a question of fact” that is “to be determined by the finder of fact and not the by the trial court as a matter of law.” See, e.g. Schrager v. North Community Bank , 767 N.E.2d 376, 386-387 (Ill. Ct. App. 2002) (citing Sims v. Tezak , 694 N.E.2d 1015 (Ill. Ct. App. 1998) ). Whether plaintiff's reliance is justifiable depends on the circumstances.
The Supreme Court of Illinois has held that “one is justified in relying upon the representations of another, without independent investigation, where the person to whom the representations are made does not have the same ability to discover truth as the person making the representations.” See e.g., Schrager , 767 N.E.2d at 386-387 (citing Gerill Corp. v. Jack L. Hargrove Builders, Inc. , 538 N.E.2d 530 (1989) ).
In assessing the reasonableness of an injured party's reliance in cases of fraud and dishonesty, Illinois courts have offered the following guidance: “Illinois law has long held that, where the representation is made as to a fact actually or presumptively within the speaker's knowledge, and contains nothing so improbable as to cause doubt of its truth, the hearer may rely upon it without investigation, even though the means of investigation were within the reach of the injured party and the parties occupied adversary positions toward one another.” Schrager , 767 N.E.2d at 386-387 (citing Sims v. Tezak). “Where the person making the statement has inhibited plaintiffs inquiries ... by creating a false sense of security the failure to inquire into facts that could be made available to the plaintiff is not fatal.” Schrager , 767 N.E.2d at 386-387 (citing Miller v. William Chevrolet/GEO, Inc. , 762 N.E.2d 1 (Ill. Ct. App. 2001) ).
Like all of FEMA's arguments, its “reliance” argument is one that raises an issue of fact to be decided by the jury. Such an issue cannot be decided on a motion to dismiss.
IV. ALLEGATIONS REGARDING FEMA'S MEDICAL CONSULTANT MUST BE TAKEN AS TRUE
Plaintiff's allegations regarding FEMA's medical consultant must be taken as true for the purposes of a motion to dismiss. See Heider , 613 N.E.2d at 810. Those allegations include: FEMA retained confidential services of a medical doctor to screen employees at flavoring manufacturing plants, the medical consultant screened Mr. Solis in 2004 and 2005, failed to inform Mr. Solis that he had severe lung injury caused by exposure to chemical flavors, sent Mr. Solis back to work, and in 2006 diagnosed Mr. Solis bronchiolitis obliterans caused by flavoring products. (1st Am. Complaint at ¶¶ 16-21.)
FEMA's motion is simply an improper attempt to argue the veracity of these allegations. In fact, FEMA admits as much when it states:
If required to answer the Am. Complaint. FEMA will deny those allegations and prove them false at trial.
(FEMA Mot. at p. 14.)
This is exactly what this Court should order FEMA to do. FEMA's agency argument is simply premature.
FEMA's motion must be denied. Defendant FEMA is an industry organization whose member companies utilize, in fact, thrive off of the labor of individuals like Mr. Solis. Plaintiff plainly alleges that FEMA knew, by at least 1988 that diacetyl caused severe lung damage and disease. Plaintiff also alleges that FEMA concealed that information from the public, and more specifically, Gerardo Solis. Gerardo Solis' injuries were caused and worsened by FEMA's concealment. The facts of this case - as already set forth - exemplify the very essence of a fraud by concealment action. The laws of the State of Illinois recognize such a claim. And, under this State's rules of pleading, Plaintiff has sufficiently alleged all required elements and supporting facts. Thus, this Court should recognize FEMA's motion for what it is - a poorly disguised and improper attempt to preclude Plaintiff from rightful discovery before responding to a motion for summary judgment. Plaintiff's First Amended Complaint withstands the pleading scrutiny required by Illinois law, and accordingly FEMA's motion should be denied.