Port Authority of New York & New Jersey v. Arcadian Corp.

Brief Fact Summary.

Terrorist detonated a bomb in New York City under the World Trade Center. The bomb was made with fertilizers. Plaintiff brought suit against the fertilizer manufactures, defendants, on the grounds of negligence, strict products liability, and failure to warn. The federal district court dismissed Plaintiff’s complaint for failure to state a claim. Plaintiff appealed.

Synopsis of Rule of Law.

A manufacture of a component that is altered for criminal purposes is void of liability for injuries caused by the components end result when the component, itself, was not defective or unreasonable dangerous and the component’s alteration was not reasonably foreseeable. 

Facts.

In New York City, on February 26, 1993, terrorists detonated a bomb under the World Trade Center, which resulted in six deaths, multiple injuries, and substantial property damage. The bomb was made with fertilizers, such as ammonium nitrate, urea, and nitric acid, which was manufactured by Arcadian Corporation, Hydro-Agri North America, Inc., and Dyno Nobel Inc. (collectively, defendants). Generally, the fertilizers, in their raw, single composition, were not dangerous. However, when the fertilizers are combined, their explosive character is created. The owner of the World Trade Center, Port Authority of New York & New Jersey (plaintiff) brought suit against defendants on the grounds of negligence, strict products liability, and failure to warn. Plaintiff contended that defendants could have labeled their products non-detonable and, at the same time, warned sellers to make sure that the products were being purchased for proper use. Plaintiff asserted that defendants should have known or knew that the products may be used to make explosive materials because of two explosions were previously cause by ammonium nitrate about thirty years ago and because several foreign countries regulate the products due to their explosion-producing characteristics. A federal district court dismissed Plaintiff’s complaint for the failure to state of a cause of action. Plaintiff appealed.

Issue.

Whether a manufacture of a component that is altered for criminal purposes is void of liability for injuries caused by the components end result when the component, itself, was not defective or unreasonable dangerous and the component’s alteration was not reasonably foreseeable.

Held.

Yes, a manufacture of a component that is altered for criminal purposes is void of liability for injuries caused by the components end result when the component, itself, was not defective or unreasonable dangerous and the component’s alteration was not reasonably foreseeable.

Concurrence.

Because the majority’s decision is founded upon foreseeability, there may be an increase in crimes in the future, which may change whether such acts are foreseeable to impose liability.

Discussion.

Case law precedent illustrates that a manufacturer of a raw material or component that is not, itself, dangerous does not have a duty to prevent someone from tampering with or altering the product to make it dangerous, unless the alteration is reasonably foreseeable. In this case, defendants could not reasonably foresee that the fertilizers would be used to construct a bomb based on two incidents that occurred more than thirty years ago. Also, Plaintiff is unable to satisfy the proximate cause element. Here, defendants were not the proximate cause of Plaintiff’s injury from the World Trade Center bombing because the terrorist’s actions constitute intervening acts, which supersede the defendant’s liability, as they were unforeseeable. Lastly, Plaintiff’s failure-to-warn contention is also unfounded because Plaintiff lacks legal authority to require a middleman to make sure that purchasers are properly using the products. Therefore, the district court’s decision is affirmed.