SPAIN v. BROWN & WILLIAMSON TOBACCO CORP.

CARNES, Circuit Judge:

This is a cigarette product liability case initially brought in the Alabama state courts by Paul Spain, as administrator of the estate of Carolyn Spain, against Phillip Morris, Inc., R.J. Reynolds Tobacco Company, and Brown & Williamson Tobacco Corporation, seeking recovery under the Alabama wrongful death statute. After removing the case to federal court on diversity grounds, the defendants filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). Stating only that the motion was "well-taken," the district court granted it and dismissed all of Spain's claims with prejudice. Spain has appealed. For reasons we will explain, we have concluded that certain issues of state law should be certified to the Alabama Supreme Court.

I. BACKGROUND

A. FACTS

Because the case is before us on a Rule 12(b)(6) dismissal, we take the facts from the allegations in the complaint, assuming those allegations to be true. See Brown v. Crawford County, Georgia, 960 F.2d 1002, 1010 (11th Cir.1992).

Carolyn Spain started smoking cigarettes in 1962, when she was "approximately 15 years of age and was a multi-pack per day smoker." She became addicted to the nicotine in cigarettes early on and was unaware at the time that she was becoming addicted. She primarily smoked cigarettes manufactured by Phillip Morris, Inc., R.J. Reynolds Tobacco Company, and Brown & Williamson Tobacco Corporation. Carolyn's smoking was the proximate cause of her lung cancer, which was diagnosed on August 15, 1998. Unable to stop, she continued smoking until 1999. She has since died.1

B. PROCEDURAL HISTORY

On August 5, 1999, Paul Spain, as administrator of the estate of Carolyn Watts Spain, filed suit against the defendants in state court, seeking recovery under the Alabama wrongful death statute based on the defendants' alleged wrongful acts and omissions in connection with the manufacture, design and sale of cigarettes. The complaint asserted five causes of action: (1) liability under the Alabama Extended Manufacturers Liability Doctrine ("AEMLD"); (2) negligence; (3) wantonness; (4) breach of warranty; and (5) conspiracy.2

The defendants removed the case to federal court,3 and after removal filed a motion to dismiss all of Spain's claims under Federal Rule of Civil Procedure 12(b)(6). They argued, among other things, that the claims were barred by Alabama's rule of repose and the applicable statutes of limitations; that as a matter of Alabama law cigarettes are not unreasonably dangerous; and that some of Spain's claims were preempted by federal law. Stating only that the motion was "well-taken," the district court granted it and dismissed all of Spain's claims with prejudice. This is Spain's appeal of that dismissal.4

II. DISCUSSION

Although federal court jurisdiction is premised on diversity of citizenship, important federal law preemption issues will be presented for us to decide if, and only if, Spain's claims survive the multitude of state law arguments and defenses the defendants have raised. We will begin our discussion by describing the federal law preemption issue in this case, and then the state law issues, the resolution of which will define and may render academic that federal issue.

A. THE FEDERAL LAW ISSUE

Section 5(b) of the Federal Cigarette Labeling and Advertising Act of 1965 ("1965 Act"), as amended by the Public Health Cigarette Smoking Act of 1969 ("Labeling Act" or "1969 Act"), states: "No requirement or prohibition based on smoking and health shall be imposed under State law with respect to the advertising or promotion of any cigarettes the packages of which are [lawfully] labeled." 15 U.S.C. § 1334(b). The lawfully required label is the familiar "WARNING: THE SURGEON GENERAL HAS DETERMINED THAT CIGARETTE SMOKING IS DANGEROUS TO YOUR HEALTH." See Cipollone v. Liggett Group, Inc., 505 U.S. 504, 508, 112 S.Ct. 2608, 2613, 120 L.Ed.2d 407 (1992) (plurality opinion).

In Cipollone, the Supreme Court set forth a test to determine which state law claims are preempted by the Labeling Act. See id. at 524, 112 S.Ct. at 2621. A common law or other state law claim is preempted if "the legal duty that is the predicate of the ... action constitutes a `requirement or prohibition based on smoking and health ... imposed under State law with respect to ... advertising or promotion,' giving that clause a fair but narrow reading." Id.

The defendants contend that the post-1969 portion of the claims Spain asserts are precisely the type of claims Cipollone held to be preempted, because those claims seek to impose a duty to provide warnings over and beyond those required by the Labeling Act.5 Citing the Alabama Supreme Court's decision in Cantley v. Lorillard Tobacco Co., 681 So.2d 1057, 1061-62 (Ala.1996), the defendants argue that under Alabama law they had no duty to provide additional warnings beyond those required by federal law and no duty to communicate even those warnings by means other than advertising or promotion.

Spain, on the other hand, contends that the Labeling Act had limited preemptive effect. He maintains that under Cipollone and Cantley, many of his claims (including his pre-1970 claims in their entirety, his post-1969 claims for defect in product, misrepresentation and conspiracy, his post-1969 claims for negligence based on testing or research practices, and his post-1969 claims for negligence based on failure to disclose facts through channels of communication other than advertising or promotion) survive federal preemption.6 Finally, Spain argues that there is a genuine issue of material fact as to whether the defendants violated the Labeling Act, although he does not specify what consequences he thinks follow from such a failure.

At the outset, we recognize that Spain's state law claims, insofar as they relate to the time period before the effective date of the 1969 Labeling Act, are not preempted by that federal legislation. Those claims' viability or lack of it will depend entirely upon disputed issues of state law. So, "[t]here is no way for us to avoid [those] state law issues in this case," Blue Cross & Blue Shield of Alabama, Inc. v. Nielson, 116 F.3d 1406, 1412 (11th Cir.1997).

In addition to requiring a state law answer to the pre-1969 portion of Spain's claims, this case may also require us to decide the federal law issue of which, if any, of Spain's post-1969 claims are preempted by the Labeling Act. But we will not reach that federal law issue unless some of those post-1969 claims are otherwise viable under state law. In other words, if Spain has no post-1969 claims as a matter of state law, or if there are complete state law defenses to those claims, then we will not reach the federal law preemption issue. That is why resolution of the state law issues is certainly the first, and depending upon how those issues are resolved could be the final, step in deciding this case.

B. THE STATE LAW ISSUES

1. When the Causes of Action Accrued for Purposes of the Applicable Statutes of Limitations

There is no dispute about which statutes of limitations apply to Spain's claims. The parties agree that the AEMLD, negligence, wantonness and conspiracy claims are subject to a 2-year statute of limitations, see Ala.Code § 6-2-38, and that the breach of warranty claim is subject to a 4-year statute of limitations, see Ala.Code § 7-2-725. The dispute is about when the claims arose, or the causes of action accrued, and thus when those statutes of limitations began to run.

Alabama's general rule regarding statutes of limitations is as follows:

Kelly v. Shropshire, 199 Ala. 602, 75 So. 291, 292 (1917) (as quoted in Garrett v. Raytheon Co., 368 So.2d 516, 519 (Ala. 1979)). However:

Garrett, 368 So.2d at 519 (internal marks omitted); see generally McWilliams v. Union Pacific Resources Co., 569 So.2d 702, 704-06 (Ala.1990) (Maddox, J., concurring specially) (discussing the "two lines of cases dealing with the tolling of the statute of limitations where the damages became apparent only sometime after the actual wrong was committed").7

The defendants argue that, taking the complaint as true, a "completed wrong" occurred, and thus Spain's cause of action arose, when Carolyn became addicted to cigarettes shortly after she began smoking in 1962. As a result, they contend, Spain's claims are barred in their entirety by the applicable statutes of limitations. Spain, on the other hand, maintains that Carolyn did not have an actual injury, and thus the cause of action did not accrue, until August 15, 1998, when Carolyn was diagnosed with lung cancer. Accordingly, Spain argues that the complaint, which was filed on August 5, 1999, was filed within the statutes of limitations.

If defendants are correct that these kinds of causes of action accrue when a smoker becomes addicted to cigarettes, then all of the claims in this case are barred by statutes of limitations. By contrast, if Spain is correct that the causes of action did not accrue until Carolyn was diagnosed with lung cancer, which occurred less than a year before the filing of the complaint, then none of the claims is barred on statute of limitations grounds. So, the question of when the causes of action accrued for statute of limitations purposes is critically important to, and may be dispositive of, this case.

Unfortunately, we have been unable to locate a clear answer to this state law issue. The Alabama Supreme Court has yet to address statute of limitations issues in the context of a cigarette products liability case, and it is uncertain whether the "completed wrong" sufficient to begin the running of the applicable limitations period occurs at the time of addiction to cigarette smoking, the time of the last exposure to cigarette smoke, the time a smoking-related illness or injury is diagnosed, or some other time.8 The Alabama Supreme Court could choose any of a number of alternatives. Compare Garrett, 368 So.2d at 519 (last date of exposure to radiation begins the running of statute of limitations); with Chatham v. CSX Transp., Inc., 613 So.2d 341, 344 (Ala.1993) (FELA case interpreting a Third Circuit opinion as implying that if discovery of injury occurs before the end of exposure, the discovery of injury marks the beginning of the limitations period); and Allgood v. R.J. Reynolds Tobacco Co., 80 F.3d 168, 170 (5th Cir.1996) (continuing tort rule does not apply where plaintiff did not quit smoking until 1987 but learned of his injury in 1986, but that result was reached through application of the discovery rule).9 Whatever alternative it chooses, the Alabama Supreme Court is the proper court to make the choice. "[I]t would be irresponsible of us not to give the Alabama Supreme Court an opportunity to decide th[is] difficult, sensitive and [potentially] dispositive Alabama law issue[]...." Blue Cross & Blue Shield of Alabama, 116 F.3d at 1413.

2. The Rule of Repose Issues

On a related note, the defendants also contend that Alabama rule of repose bars Spain's claims. Spain disagrees, maintaining not only that his case was timely filed, but also that the rule of repose is inapplicable in personal injury tort cases like this one.

Alabama's rule of repose is similar to a statute of limitations but broader in its scope. "[T]he only element of the rule of repose is time. It is not affected by the circumstances of the situation, by personal disabilities, or by whether prejudice has resulted or evidence obscured." Boshell v. Keith, 418 So.2d 89, 91 (Ala. 1982) (citations omitted). The rule of repose operates as an absolute bar to claims that are not commenced within twenty years from the time they could have been. See id. at 91. As the Supreme Court of Alabama stated:

Snodgrass v. Snodgrass, 176 Ala. 276, 58 So. 201, 201 (1912) (as quoted in Boshell, 418 So.2d at 91).

We are unsure whether the rule of repose is applicable to this case. Although it has been applied to a number of different actions, see, e.g., Tierce v. Ellis, 624 So.2d 553 (Ala.1993) (applying the rule of repose to bar a declaratory judgment action to establish paternity for the sake of determining estate's heirs), we have not been cited to nor have we located an Alabama Supreme Court case applying the rule of repose to a personal injury tort suit. However, the Court of Civil Appeals of Alabama has indicated in at least one case that the rule of repose can be applied to such an action. See Willis v. Shadow Lawn Memorial Park, 709 So.2d 1241 (Ala.Civ.App.1998) (question of fact concerning the time that plaintiff's claims accrued prevents application of rule of repose in suit for fraud, conversion, breach of burial contract, negligence, wantonness, and intentional or reckless infliction of emotional distress). Again, we believe the Alabama Supreme Court should decide the purely state law issue of whether the rule of repose operates to bar Spain's claims, which is yet another issue the resolution of which could dispose of this case.

The statute of limitations and rule of repose issues cut across the entire case, and it is important that Alabama's highest court be given the opportunity to answer them: "The final arbiter of state law is the state supreme court, which is another way of saying that Alabama law is what the Alabama Supreme Court says it is. Because the only authoritative voice on Alabama law is the Alabama Supreme Court, it is axiomatic that that court is the best one to decide issues of Alabama law." Blue Cross & Blue Shield of Alabama, 116 F.3d at 1413 (citations omitted).

The answers to the statute of limitations and rule of repose questions could dispose of this case, but if they do not there are other state law issues that need to be decided. Spain's substantive claims, which include claims under the AEMLD, and claims premised on negligence, wantonness, breach of warranty, and conspiracy, are all based on state law.

3. The Issues Involving Spain's AEMLD Claim

The Alabama Extended Manufacturer's Liability Doctrine was first recognized by the Alabama Supreme Court in Atkins v. American Motors Corp., 335 So.2d 134 (Ala.1976), and its companion case, Casrell v. Altec Indus., Inc., 335 So.2d 128 (Ala.1976). See Wakeland v. Brown & Williamson Tobacco Corp., 996 F.Supp. 1213, 1217 (S.D.Ala.1998). To recover under the AEMLD, a plaintiff must show, among other things, that "an injury was caused by one who sold a product in a defective condition that made the product unreasonably dangerous to the ultimate user or consumer...." Bell v. T.R. Miller Mill Co., Inc., 768 So.2d 953 (Ala.2000); see also Allen v. Delchamps, Inc., 624 So.2d 1065, 1068 (Ala.1993).

Under Alabama law, a product is not unreasonably dangerous unless it fails to "meet the reasonable safety expectations of an ordinary consumer, that is, an objective ordinary consumer possessed of the ordinary knowledge common to the community." Deere & Co. v. Grose, 586 So.2d 196, 198 (Ala.1991) (internal marks and citations omitted); see also Casrell, 335 So.2d at 133 (establishing "reasonable expectations" test and adopting comment i to § 402A of the Restatement (Second) of Torts); Ex Parte Chevron Chemical Co., 720 So.2d 922, 927 (Ala.1998) ("unreasonably dangerous" product does not include "a product the dangers of which the consumer could be expected to be aware of, an awareness that may be enlightened by a warning."). "Although, under Alabama law, a jury ordinarily evaluates a plaintiff's claims that a product is defective, our review of the pertinent case law convinces us that certain products whose inherent danger is patent and obvious, do not, as a matter of law, involve defects of a sort that a jury should resolve." Elliott v. Brunswick Corp., 903 F.2d 1505, 1507 (11th Cir.1990).

The defendants contend that cigarettes are not unreasonably dangerous as a matter of Alabama law, because the risks of smoking have been commonly known among ordinary consumers for many years.10 They point to published scientific studies from 1920 to 1962; to Austin v. State of Tennessee, 179 U.S. 343, 348, 21 S.Ct. 132, 45 L.Ed. 224 (1900), a 1900 Supreme Court case which, they contend, recognized the risks of cigarettes; and to an Alabama law, more than a century old, which restricted the use of cigarettes by minors. Spain responds that a jury should determine whether products are unreasonably dangerous, and that there is a question as to whether in the early 1960s the general public was aware of the dangerousness of cigarettes.

Carolyn started smoking sometime in 1962 and became addicted to cigarettes soon thereafter. The federally mandated warnings did not appear until well after, but there is evidence that people in general knew prior to 1962 that smoking is dangerous to health. In its 1992 opinion in Cipollone, 505 U.S. 504, 112 S.Ct. 2608, 120 L.Ed.2d 407, the Supreme Court recognized that the dangers of cigarettes were well-known and had been for decades.11 See id. at 508, 112 S.Ct. at 2613; accord, Allgood, 80 F.3d at 172 (affirming district court's alternative ruling in case involving smoker who was diagnosed with emphysema in 1986 and died in 1989 that claims based on failure to warn were barred because smoking risks were common knowledge; observing that "[l]ike the dangers of alcohol consumption, the dangers of cigarette smoking have long been known to the community"); Roysdon v. R.J. Reynolds Tobacco Co., 849 F.2d 230, 236 (6th Cir.1988) (affirming district court ruling that as of 1974, the relevant date in that case, knowledge of the risks of cigarette smoking was widespread and precluded existence of a jury question on whether cigarettes are unreasonably dangerous). Moreover, the Report of the Task Force on Tobacco Litigation Submitted to Governor James and Attorney General Sessions, 27 Cumb. L. Rev. 577 (1996) stated, "Virtually every smoker in Alabama has known (or at least should have known) for many years that cigarettes are dangerous." Id. at 590.

But neither the Allgood nor the Roysdon decision involved Alabama law, and the Alabama Supreme Court is not bound by those decisions anyway. There is no decision of the Alabama Supreme Court close enough on point to remove our uncertainty about how that Court will decide the issue when it is presented, as it inevitably will be in some case. Moreover, the answer to this question is potentially dispositive of the AEMLD claim, and could render unnecessary any decision by this Court on the federal preemption issues relating to that claim. For these reasons, and because we are certifying the statute of limitations and rule of repose issues to that Court anyway, we deem it prudent to send as well the question of whether cigarettes are unreasonably dangerous as a matter of Alabama law, both before and after the federally mandated warnings appeared.

4. The Issues Involving the Other State Law Claims

The issues we have discussed so far, which relate to the statute of limitations, the rule of repose, and the AEMLD, involve unsettled and potentially dispositive state law questions upon which we need guidance. There are other state law issues in this case which we are reasonably confident that we can decide based upon settled Alabama law. For that reason, we would not bother the Alabama Supreme Court with these issues if they were the only state law issues in the case. However, since we are certifying the other state law questions anyway, we think it prudent to set out our understanding of state law on these other points and invite the Alabama Supreme Court to correct our view on them if that view is wrong.

a. Negligence and Wantonness

The defendants contend that Spain's negligence and wantonness claims are merged into his AEMLD claim as a matter of Alabama law because those claims are based on the same underlying allegations and theory, which is that cigarettes are unreasonably dangerous. In Veal v. Teleflex, Inc., 586 So.2d 188 (Ala. 1991), the Court held that the trial court did not err when it instructed the jury only on the plaintiff's AEMLD claim and refused to instruct the jury on negligence and wantonness. The court stated that the substance of plaintiff's complaint "was that it placed into the stream of commerce a product that was unreasonably dangerous for its intended use" and that constituted an AEMLD claim. See id. at 190-91; accord Wakeland, 996 F.Supp. at 1217-18.

In light of Veal, and because the only allegation in the complaint's counts for negligence and wantonness that are not in the AEMLD count is that the "[d]efendants negligently designed, manufactured, sold, marketed and/or failed to warn about cigarettes that were unreasonably dangerous ...," we are convinced that the negligence and wantonness claims in this case merge into the AEMLD claim.12

b. Breach of Warranty

The defendants contend that Spain's implied warranty of merchantability claim must fail because Spain alleges only that cigarettes are unreasonably dangerous and defectively designed, manufactured and marketed, and not that they were commercially unfit or unsuitable for smoking. The defendants argue that Spain's allegations constitute a products liability claim, instead of a breach of implied warranty of merchantability claim.

Ala.Code § 7-2-314, which governs the implied warranty of merchantability, provides as follows:

Ala.Code § 7-2-314(1). In order to be merchantable, goods must be fit "for the ordinary purposes for which such goods are used." See Allen, 624 So.2d at 1068.

As we read Spain's complaint, his theory is that the cigarettes were unfit for the ordinary purpose for which they are used because they caused cancer, making them unreasonably dangerous and not merchantable. The Alabama Supreme Court rejected a similar claim and stated that "[s]uch an argument ignores the clear distinction between causes of action arising under tort law and those arising under the [Uniform Commercial Code] as adopted in Alabama." Shell v. Union Oil Co., 489 So.2d 569, 571 (Ala.1986) (no claim for breach of warranty regarding product containing benzene, a carcinogen known to cause leukemia, when product was in conformance with specifications; such a claim is instead an AEMLD action). Unless the Alabama Supreme Court tells us differently, we are convinced that the complaint does not state a claim for breach of an implied warranty of merchantability.13

c. Conspiracy

The defendants contend that Spain's conspiracy count cannot stand, because it is based on claims of alleged fraudulent suppression and fraudulent misrepresentation of information about smoking risks that are themselves not viable.14 They argue that those claims are not viable, because Alabama imposes no duty to disclose facts that are already known and the risks of smoking were common knowledge.15

"[A] conspiracy itself furnishes no cause of action. The gist of the action is not the conspiracy but the underlying wrong that was allegedly committed. If the underlying cause of action is not viable, the conspiracy claim must also fail." Allied Supply Co., Inc. v. Brown, 585 So.2d 33, 36 (Ala.1991) (internal citations omitted). Therefore, to the extent Spain's conspiracy claim is premised on claims of fraudulent suppression and fraudulent misrepresentation, those claims must be viable for his conspiracy claim to be.

Under Alabama law, a fraudulent suppression claim requires a plaintiff to show:

Ex Parte Household Retail Services, 744 So.2d 871, 879 (Ala.1999). Under Cantley, there is no state law duty to disclose facts other than through advertising or promotion. See Cantley, 681 So.2d at 1061-62. Consequently, unless the Alabama Supreme Court tells us differently, we are convinced that the fraudulent suppression claim fails and the conspiracy claim should be dismissed to the extent it relies on the fraudulent suppression claim.

A fraudulent misrepresentation claim requires a plaintiff to show:

Ex Parte Household Retail Services, 744 So.2d at 877 (internal marks and citations omitted). The Alabama Supreme Court's answer to the question we are certifying it about whether cigarettes are unreasonably dangerous under the AEMLD may resolve the issue of whether Spain has a valid fraudulent misrepresentation claim. If that Court concludes cigarettes are not unreasonably dangerous as a matter of Alabama law, we are convinced that Spain will be unable to establish Carolyn's justifiable reliance and as a result, his fraudulent misrepresentation claim will fail and his conspiracy claim should be dismissed to the extent it relies on the fraudulent misrepresentation claim. That conclusion is, of course, subject to revision if the Alabama Supreme Court tells us that the state law premises for it are mistaken.

C. THE CERTIFIED QUESTIONS

For the foregoing reasons, we respectfully certify to the Alabama Supreme Court the following questions:

In addition to certifying the preceding questions to the Alabama Supreme Court, we also invite that Court to tell us if the conclusions we have reached about the following state law issues are incorrect:

Our phrasing of the certified questions is not intended to restrict the scope of inquiry by the Supreme Court of Alabama. As we have stated before:

Blue Cross & Blue Shield of Alabama, 116 F.3d at 1414 (quoting Martinez v. Rodriquez, 394 F.2d 156, 159 n. 6 (5th Cir.1968) (citations omitted)). That means, among other things, that if we have overlooked or mischaracterized any state law issues or inartfully stated any of the questions we have posed, we hope the Alabama Supreme Court will feel free to make the necessary corrections.16

The entire record, including the briefs of the parties, is transmitted herewith.