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Defense Victory: Partial Summary Judgment returned on alleged fraud by concealment including unfair competition claims by Jeffrey W. Allen In December 2003, the Honorable Vaughn Walker (Federal District Court of Northern California in San Francisco) granted Partial Summary Judgment on claims asserted against Sears, Roebuck and Co. for fraudulent concealment, express warranty and violations of Business and Professions Code Section 17200 (California’s Unfair Competition statute) in a product liability lawsuit involving aspects of the Consumer Product Safety Commission’s Recall of Craftsman Radial Arm Saws manufactured by Emerson Electric Co. Plaintiff alleged fraud against Sears for allegedly concealing information about an ongoing radial arm saw recall when plaintiff purchased a replacement table part for his used saw at a local Sears Parts store. Plaintiff claimed he was injured while operating the radial arm saw after he bought the replacement table part. Had plaintiff been told about the recall and replacement safety guard, plaintiff alleged the accident would not have happened. Sears agued that a duty to disclose, under a fraudulent concealment theory, could not be predicated upon plaintiff’s garden-variety purchase of a replacement part for a second-hand tool. Further, case law interpretation of the “exclusive knowledge” element of a fraud claim under California law was not established by plaintiff. Sears submitted evidence of its recall efforts and the wide dissemination of notice of the recall to the public. Information about the recall was reasonably discoverable by a person in plaintiffs’ position, and therefore that Sears had no affirmative duty to disclose the fact of a recall during the purchase of a component part. Posted recall notices were located within the retail stores which plaintiff visited; indeed, notice was also available at the Sears, Emerson and CPSC websites on the internet. Notice of the recall was also included in Craftsman Club mailers (of which plaintiff was a member) and in various woodworking magazines. Recall information was also placed as inserts in packages for replacement saw blades sold at Sears. Judge Walker found that Sears did not possess “exclusive knowledge” of the Radial Arm Saw recall as the information was reasonably discoverable by plaintiffs as a matter of law. Contrary to the charging allegations, the evidence showed that Sears was "actively revealing, not concealing" recall information. In the month [January 2004] following the opinion, Plaintiff agreed to dismiss his entire suit for waiver of costs. Fn 1. Sears was represented jointly by Jeffrey William Allen and associate Andrew Shalauta of Mr. Allen’s former law firm--Burnham Brown in Oakland, CA and by Gregory Kopacz and Douglas Fryer at Dykema Gossett in Bloomington Hills, Michigan.
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