State Farm (Subrogee E. Kern) v. Colder Products Company

Stephen H. Smith and Sung Ho (Sean) Kim obtained a defense verdict in favor of Colder Products Company in binding arbitration conducted in connection with a lawsuit brought by State Farm. Plaintiff, State Farm, alleged that Colder’s quick-disconnect coupling attached to a residential water filter system was defectively designed, such that the alleged design defect caused the coupling to fail. This failure allegedly resulted in property damage. Based on the property damage, plaintiff sought reimbursement of all payments made by plaintiff for repairing the damage.

In response, defendant Colder demonstrated that the couplings were a component part of an overall water filtration system designed by others. Since Colder’s role was limited to that as a component part supplier, Colder argued that it was insulated from liability under the “component part manufacturer defense.” In support of that defense, Colder established that the subject coupling was manufactured and supplied in accordance with the specifications provided by its customer, the filter system manufacturer and designer. In addition, although plaintiff’s expert opined – in a conclusory manner – that the subject coupling was defectively designed, Colder effectively cross-examined plaintiff’s expert by showing that plaintiff’s expert had no knowledge of the design history and product development of the component part and the overall water filtration system.

The arbitrator found in favor of Colder, based primarily on the component part manufacturer defense. Accordingly, a defense verdict was awarded in favor of colder and judgment entered for Colder in accordance with the arbitrator’s decision.