REI appeals Monika Johnson's case

[sobo]

Shit

http://seattletimes.nwsource.com/html/localnews/2014151086_skier07m.html

You guys don't pay much attention to things around here, huh?

[Coldfinger]

Here's a cross-post from TAY that seems consistent with Matt's explanation:

 

"I am an attorney and a former bicycle framebuilder (now a hobby). Some of these issues lie outside the sweet spot of my legal expertise, but I'll offer these comments:

 

1. I highly doubt that the decision to appeal is in REI's control. It is more likely in the control of REI's product liability insurance carrier. The policy likely provides that the carrier (who is ultimately on the hook to pay) controls all decisions re settlement and litigation. I've never heard of a PL policy that gives control over such matters to the insured. Such a rare provision might exist in some rare policy, but I've never seen one nor have I heard of one. So, I will assume that REI has no control over the decision to appeal.

 

2. I have quickly read through the opinion issued in Feb by the Court of Appeals, Division I. The fundamental issue is purely legal and involves the tension between the Washington Products Liability Act (WPLA) and comparative fault provisions of RCW Chapter 4.22 (sometimes called the "Tort Reform Act").

 

3. The WPLA generally imposes strict liability on the manufacturer of a defective product, but holds a mere "product seller" (e.g., a mom and pop bicycle shop) to liability only for negligence, breach of express warranty or intentional misrepresentation. However, the WPLA also provides that, in limited circumstances, a the liability standard of a manufacturer may be imposed on a seller "where the product was marketed under a trade name or brand name of the product seller.” This private labeler liability appears to apply to REI’s Novara branded bicycle products.

 

4. Where more than one party has contributed to the injury suffered by the plaintiff, under the comparative fault provisions of RCW Chapter 4.22 one of the several liable parties can “point the finger” at the other parties by attributing a percentage of fault to them, thus limiting the finger pointer's liability. (I’m simplifying things here, so tort experts please forgive me.) In this case, the manufacturer, Aprebic Industry Company, Ltd., was not named in Monika’s action and was thus an “empty chair.” (I will assume that Aprebic was not named because Monika’s attorneys did not want to get stuck trying to chase assets in Asia.) So, the legal issue is whether REI can attribute all or a large percentage of fault to Aprebic and thus avoid liability or some portion of it.

 

5. Division I ruled in favor of Monika, rejecting REI’s argument that the CF provisions of RCW Ch. 22 trumped the WPLA imposition of manufacturer liability on private label sellers. Division I reasoned, among other things, that allowing REI to allocate fault would have the effect of abrogating the private labeler liability of the WPLC. Division I’s opinion is very well reasoned and well written. While it is difficult to forecast what WA Supreme Court will do, I am optimistic that Division I’s ruling will be affirmed.

 

6. If people are going to get angry at someone, I suggest you direct your ire against the insurance industry which heavily lobbied the WA legislature to pass RCW 4.22 and those lawmakers who are shills for the industry. As I state above, REI likely has no control over whether or not to appeal. The insurance industry continues its efforts to avoid liability by, for example, blaming soaring medical costs on insurance payouts to victims of medical malpractice and their attorneys," ....etc

 

Well said!

 

As an bit of an expert on these matters, I'd say (speculation), you hit this right on the head.

 

Keep in mind that from the insurance company's perspective it would be grossly (fill in the blank) for them to assume ALL the financial liability without ANY and most likely ALL control of the case.

 

One often unseen benefit of insurance (until you need it), is that they do get in there and make some pretty tough decisions. Keep in mind that without a vigorous defense by said companies, most of us with rather more limited amounts of coverage would end up paying any excess amount.

 

On the flip side there are the legal bills for all this wrangling and I have to wonder what that slice of the pie will be......

[rmncwrtr]

Would the insurance company have kept REI from refunding the cost of the bike when she returned it? That's what I don't get when they'll give refunds to other customers, why not to Monika?

 

I mentioned the bike and no refund in my email, they didn't address it. Except for an extra sentence at the top thanking me for being a long-time customer, it was the same form letter as everyone else.

 

 

[Coldfinger]

Would the insurance company have kept REI from refunding the cost of the bike when she returned it? That's what I don't get when they'll give refunds to other customers, why not to Monika?

 

I mentioned the bike and no refund in my email, they didn't address it. Except for an extra sentence at the top thanking me for being a long-time customer, it was the same form letter as everyone else.

 

 

No, routine returns are under the direct control of REI as it THEIR policy, insurance is for when a product they sell causes personal injury, property loss and/or death. Just a guess, but if I were Monika's attorney, I wouldn't return that bike for the REI refund until case was closed as it is a a rather important piece of evidence.

 

Not saying this case has been handled well or not, just seems like REI is taking a bashing and folks are all over the place as far as understanding what is actually going on.

 

Rabble rabble......

[CascadeClimber]

I don't accept that REI is not responsible for this situation. I see two possibilities:

 

1. Ignorance: They purchased an insurance policy they didn't understand which has resulted in an insurance company making major decisions for the corporation. The net here is gross incompetence by REI management.

 

2. They carefully chose a policy that would leave them looking like a victim in this situation (poor REI can't do the right thing because of their insurance company). The net here is Evil REI.

 

This situation, made by REI, does not absolve the co-op of accountability in my eyes.

 

Also, can you imagine the precedent this case could set? Corporations are not responsible for products they sell under their own name if they don't actually make the products. Consumers who are harmed due to defects in said products are obliged to determine which part failed, who made the part, then sue that company. And if the company is off-shore, as most of the actual manufacturers are, then the injured party is essentially SOL. Your iPhone caught fire and burned you? Oh, you'll need to sue Foxconn Technology, a Chinese company. Good luck, have fun.

 

We're getting to the point where corporations have more personal rights, protection, and freedoms than actual persons.

[Coldfinger]

You wanna bash them, bash them.

 

All this second guessing re what kind of insurance? Do you think that an insurance company would even offer what you want?

 

Or put another way what about the contract between REI and the manufacturer?

 

Do we ignore that also?

 

Besides, seems like there are MANY other excuses to feel good about Returning Every Item.

[AlpineK]

Whatever the outcome, given the situation and the coverage it will hurt REI. Maybe just a little but still...

[Coldfinger]

Because it is probably the take home lesson, I'm reposting this section:

 

If people are going to get angry at someone, I suggest you direct your ire against the insurance industry which heavily lobbied the WA legislature to pass RCW 4.22 and those lawmakers who are shills for the industry. As I state above, REI likely has no control over whether or not to appeal. . . . This is America, where the powerful blame the victim and obscures the truth.

 

I might suggest you read your home and auto insurance policies to see how much control you have if there is a claim against you......

[CascadeClimber]

Because it is probably the take home lesson, I'm reposting this section:

 

If people are going to get angry at someone, I suggest you direct your ire against the insurance industry which heavily lobbied the WA legislature to pass RCW 4.22 and those lawmakers who are shills for the industry. As I state above, REI likely has no control over whether or not to appeal. . . . This is America, where the powerful blame the victim and obscures the truth.

 

I might suggest you read your home and auto insurance policies to see how much control you have if there is a claim against you......

 

The law only comes into play when parties can't amicably reconcile between themselves. I've been involved in at least two car accidents where the offending party just paid for repairs instead of involving said scummy insurance companies.

 

And I'll repeat myself: If REI signed a policy that grants major management decisions to an outside company, they are still accountable.

 

You can quibble about the languange and intent of the law all you want. It doesn't change the fact that REI is refusing to make whole a person severely injured by an REI-branded product for which they tout (loudly) a lifetime guarantee. I'm not buying the "Poor REI is a victim, too" line.

Edited May 23, 2011 by CascadeClimber

[Coldfinger]

I don't buy it either, only thing is when they will pay. Actually when their insurance will pay. And that's the problem here.

 

Can't say I'm a fan of whoever made such a crappy fork either.

 

Fair enough debate whether corporate structure or insurance industry is the real villain, for my two cents I can't for the life of me see why we as a country rely on either or both to serve our best interests when they are only there to make a profit.

 

Just seems like the insurance scum were getting a free pass here. To me it looks like the appeal was more to protect their long term interests, not REI's (taking a beating) and most certainly not her family's.

 

 

[AlpineK]

I've maintained business insurance for years. When I first got a policy my agent told me something along the lines of, "Only use the policy if the financial hit is large enough that you can't settle on your own."

 

I've stuck with that policy.

[JasonG]

Bingo. That is what I don't get about this whole deal. It didn't sound like Monika was asking for huge damages, just the actual cost of her injury (lost wages, medical bills, etc.), the testing she had performed on the bike, and the cost of the bike itself. It all would seem reasonable given the obvious defect in the fork that caused a very serious injury. It seems after paying Monika (without involving the insurance companies), they could have issued the recall and dealt directly with the negligent manufacturer to recoup their costs.

 

But maybe they were afraid that this would open REI up to lawsuits from less reasonable people that were injured by the defective fork (and may not have heard about the recall)?

[genepires]

just got another letter from rei regarding the case. maybe a form letter, maybe not but they claim that they reimbursed Monica some.

 

In my reply I asked why it was taken to a higher court as they act like it was for valid reasons. I suspect that it was for avoidance of responsibility. I hope they lose.

 

 

Dear Mr. Pires,

 

There is more to this situation than meets the eye. Although we understand we cannot tell everyone exactly what they would like to hear right now, I’d like to finish our email exchange with a couple of points.

 

REI has a long, respected history of standing behind our products and we will do so in this situation, too. What you and others may not realize is that early on in the case, to demonstrate our good faith, we helped Monika offset some of her expenses.

 

I can appreciate that Monika’s friends – of which there are many at REI – feel strongly about this situation. That said, this case involves important issues of Washington law that deserve the attention of the Washington Supreme Court, which is the reason REI asked the court to consider the case. We trust that when this case is resolved, people will see that we have acted responsibly and in a manner consistent with REI’s enduring values.

 

We wish you continued adventures and hope we can continue to serve you.

 

Libby Catalinich

Director, Corporate Communications

REI - Recreational Equipment, Inc.

 

[JasonG]

Yes, form letter- mine looked the same. Maybe Ryan can shed some light on the reimbursement claim?

[Layback]

I got the same form letter as above in GP's post twice. The second one was sent to the next person in the alphabet relative to my name, who I happen to know. When they recalled the message I sent them a response indicating that I had forwarded their ridiculous form letter to this person on their behalf.

[pup_on_the_mountain]

I got more or less the same response for writing to their CEO - may be a bit of customization in the beginning.

Thank you for writing Sally Jewell and sharing your concerns with us regarding the case of Monika Johnson. The issues addressed in any lawsuit are often complex and sometimes, as is the case here, have broad impacts beyond just the parties. I’d like to stress that REI's appeal is not about the amount of money Monika's estate should receive through either a trial or a settlement. Instead, it is about the degree to which responsibility should be shared between a private label seller, like REI, and the manufacturer who designed and made the bike component. REI would have preferred to resolve Monika’s case early on, but circumstances beyond our control made this impossible.

 

While we are limited in what we can say. there is more to this situation than meets the eye. REI has a long, respected history of standing behind our products and we will continue to do so in this situation, too. We have worked to be reasonable and early on in the case, to demonstrate our good faith, we helped Monika offset some of her expenses.

 

I can appreciate that Monika’s friends – of which there are many at REI – feel strongly about this situation. That said, this case involves important issues of Washington law that deserve the attention of the Washington Supreme Court, which is the reason REI asked the court to consider the case. We trust that when this case is resolved, people will see that we have acted responsibly and in a manner consistent with REI’s values.

 

Sincerely,

 

Michael Collins

Vice President, Public Affairs

REI

 

BTW, are there any updates?

[rbw1966]

REI could have settled this matter long ago without accepting or admitting any liability whatsoever. Settlements of this nature occur every day.

 

The ill will generated from this incident will surely cost REI more than any settlement may have.