But a recent ruling by the 9th U.S. Circuit Court of Appeals has created a loophole that not only threatens to unlock the act’s gates and allow a flood of new lawsuits, but also creates an incentive for manufacturers to end their current practice of revising aircraft flight manuals when new information is obtained through real-life experiences. Caldwell v. Enstrom Helicopter Corp., 230 F.3d 1155 (9th Cir. 2000).
Signed into law in 1994, the act was intended to revitalize the general aviation industry which, by the early 1990s, was on the verge of extinction. In 1978, for example, the general aviation industry built more than 14,000 single-engine aircraft, but in 1993 it produced only 555 aircraft. Industry advocates attributed the near death of the industry to the staggering costs of product-liability litigation. See Thomas H. Kister, General Aviation Revitalization Act: Its Effect on Manufacturers, The General Aviation Industry is Rebounding as a Result of GARA, But Will the Legislation Also Have Unintended Consequences?, 65 Def. Couns. J. 109-110 (1998).
Congress’ decision to establish the 18-year statute of repose was based on the "legal recognition that, after an extended period of time, a product has demonstrated its safety and quality, and that it is not reasonable to hold a manufacturer legally responsible for an accident or injury occurring after that much time has elapsed." Altseimer v. Bell Helicopter Textron Inc., 919 F. Supp. 340 (E.D. Cal. 1996) (quoting Rep. Fish from the Congressional Record).
Until now, most courts have recognized that the act’s value lies in its ability to protect manufacturers from the heavy costs incurred defending litigation, even when the defendant ultimately prevails. The recent 9th Circuit ruling loses sight of this fundamental objective.
Caldwell arises from the crash of a helicopter during a sightseeing tour. The accident allegedly occurred when the helicopter ran out of usable fuel. Because the helicopter was more than 18 years old, the act prohibited most lawsuits against the helicopter manufacturer.
An exception, however, allows an action against the manufacturer of "a component, system, subassembly or other part" if, within 18 years before the accident, that part "replaced another component, system, subassembly or other part originally in, or which was added to, the aircraft." [cite].
To avoid the statute of repose, the plaintiffs alleged that within 18 years of the accident, the manufacturer issued a revised flight manual that failed to state that the last two gallons of fuel in the tanks were unusable. The pilot claimed that the revised manual caused him to miscalculate the amount of usable fuel, which caused the helicopter to crash.
The plaintiffs argued that the revised manual constituted an "other part" that started the 18-year period rolling again. The court agreed, holding that lawsuits based on substantive revisions to a flight manual, made within 18 years of an accident, will be allowed as long as plaintiffs allege that these revisions caused the accident.
Although the court’s decision turned on the meaning of "other part," the act itself provides no definition of that term. From a policy perspective, defining "other part" to include flight-manual revisions seems counterintuitive. Manufacturers may be disinclined to revise flight manuals with newly acquired safety information if each revision will start the 18-year period of repose anew.
Manufacturers also contend that Congress’ use of the term "other part" in the same phrase as the words "component," "system" and "subassembly" suggests that "other part" refers to a part that is installed in the aircraft, just as the engine and instruments are installed in the aircraft. A flight manual, although provided with an aircraft, is not installed in the aircraft itself.
None of these arguments held sway with the court. Because the manufacturer is required to provide a flight manual when it delivers the helicopter, the court decided that it was logical to consider it a "part" of the aircraft.
Surprisingly, the court’s reasoning departs from traditional rules of statutory construction. Instead of ascertaining the ordinary meaning ascribed to the term "part" in the aviation industry, or looking to the legislative history of the provision at issue, the court based its ruling on the philosopher’s "rule of the excluded middle."
In classical logic, the rule of the excluded middle (or tertium non datur) "holds that every alternation of a sentence with its negation is true." W. [full name] Quine, Philosophy of Logic 15, 83-87 (1970); see Bethel v. Jefferson, 589 F.2d 631 (1978). In other words, under the rule of the excluded middle, only one of two possibilities can be true. "Either the light is red or it is not red" is always a true statement.
The premise of this rule, however, is that no third alternative exists. In the traffic light example, for instance, the rule of the excluded middle would not apply to the statement "either the light is red or the light is green" because a determination that the light is not red does not mean it is green. It could, after all, be yellow.
In this case, the court incorrectly applied the rule of the excluded middle by first asserting that either the revised flight manual is a "separate product," or it is a "part of the aircraft." After deciding that the revised manual was not a separate product, the court found that "[b]y the rule of the excluded middle, then, it must be part of the aircraft."
Yet, no support — statutory or otherwise — is provided for the court’s initial premise. Why must the revised manual be either a separate product or a part of the aircraft? It might be neither a separate product nor a part of the aircraft, as those terms are used in the act.
In fact, at least one circuit court has ruled that an aircraft flight manual is neither a "product" nor a replacement part for purposes of product-liability law. Alexander v. Beech Aircraft Corp., 952 F.2d 1215 (10th Cir. 1991), involved facts and legal issues strikingly similar to Caldwell. As in Caldwell, the plaintiffs in Alexander alleged that an aircraft crashed after it ran out of fuel and that it ran out of fuel because the pilot operating manual failed to include adequate information about the amount of unusable fuel in each tank.
As in Caldwell, the Alexander plaintiffs alleged that a revised manual, issued five years before the crash, avoided Indiana’s ten-year statute of repose. And, as in Caldwell, they pointed to the federal aviation regulations that required the manufacturer to provide a flight manual with each aircraft.
Unlike Caldwell, however, the Alexander decision held, albeit as a matter of Indiana law, that the revised manual did not constitute either a product or a replacement part. Specifically, the Alexander court recognized that the plaintiffs’ replacement-part theory was really a failure-to-warn theory based on a condition that existed at the time of delivery more than ten years before the accident.
By finding that the manual was neither a product nor a replacement part, the Alexander court demonstrated that the "rule of the excluded middle" cannot be used in this case.
The Caldwell decision also leaves something to be desired in its attempt to find support in two federal aviation regulations. Although both regulations refer to aircraft flight manuals, neither defines the terms "part" or "separate product," makes any reference to the manual as a component, subassembly or system of the aircraft, or discusses revisions to the manual issued after the aircraft is delivered.
The first regulation, 14 C.F.R. section 27.1581(a)(2), requires the manufacturer to provide, with each aircraft it delivers, a flight manual containing information necessary for safe operation because of the aircraft’s design, operating or handling characteristics.
The second, 14 C.F.R. section 27.1585(e), requires the manufacturer to furnish information about the usable fuel supply. It does not require (as the court concluded) that this information be included in the flight manual. It could, for example, be included by way of a placard installed in the aircraft.
Thus, while a flight manual may be required by the federal aviation regulations when an aircraft is delivered, the regulations themselves provide no insight on whether they should be considered an "other part" as that term was used by Congress in drafting the act.
Overall, the Caldwell decision highlights one of the tensions inherent in the act. If the flight manual is not an "other part," how will manufacturers be held accountable for misleading information that might appear in newly revised flight manuals? On the other hand, if each revision sets the 18-year clock running anew, manufacturers will never be relieved of the threat of litigation.
The court attempted to resolve this tension by carving a judicial exception limited to substantive revisions and deletions to flight manuals. Unfortunately, deciding whether a revision is "substantive" requires a subjective standard that blurs the bright line intended by Congress when it established the statute of repose.
And, the exception may encompass more than just flight-manual revisions. Manufacturers traditionally provide a variety of information, such as service bulletins and service letters, long after the aircraft has been delivered. These items are usually mailed directly to registered aircraft owners.
The Caldwell decision suggests that any writing issued by the manufacturer within 18 years of an accident might be enough to circumvent the act’s period of repose, forcing manufacturers to once again bear the expense of protracted civil litigation.