Products Liability Law Reporter

The Ninth Circuit Court of Appeals held that the economic loss rule barred a manufacturer’s liability for damage sustained by a helicopter after a hard landing.

Here, a helicopter owned by Med-Trans Corp. experienced a hard landing, resulting in damage to the helicopter. Med-Trans and insurer Starr Indemnity and Liability Co. sued engine manufacturer Rolls-Royce Corp., alleging tort and warranty claims. The plaintiffs claimed that a defect in the Rolls-Royce third-stage turbine wheel engine component led to the hard landing and resultant damage. The defendant moved for summary judgment, which the district court granted under Texas law.

Affirming, the Ninth Circuit noted that under the economic loss rule, tort recovery for economic loss unaccompanied by injury to person or property is precluded. Citing case law, the court added that in a products liability case, Texas law disallows tort recovery for damage caused by a product to itself.

Applying these principles here, the court concluded that the district court’s ruling had been proper. The economic loss rule bars recovery for damage to the helicopter, which was the product that included components, such as the turbine wheel and engine. Damage resulting from a product component—including a replacement part or a part transferred from another helicopter—to the product itself is considered economic loss unrecoverable in tort, the court said, citing Texas appellate case law.

Additionally, the court found that the plaintiffs’ breach of warranty claim also failed in that the plaintiffs had failed to provide a copy of any written warranty still active at the time of the hard landing.

Consequently, summary judgment was proper.

Citation: Starr Indemnity & Liability Co. v. Rolls-Royce Corp., 822 Fed. App’x 582 (9th Cir. 2020).