ST. LOUIS — The U.S. Court of Appeals for the 8th Circuit is sending a class action claim against the manufacturers of yellow-insulated corrugated stainless steel tubing (CSST) back to federal court after granting the companies' appeal.
In ruling on an issue involving a plaintiff's Article III standing, a three-judge panel found in favor of defendants Omega Flex Inc., Ward Manufacturing and Titeflex Corp. in a suit brought by plaintiffs Bonnie George, Ed McKinzie, Tim Worstell, Cedar Deraps, Casey Wasser, Tammy Volkart, James Rehm and Ron Metzgar.
Their suit claims that the defendants' CSST, which is used to distribute natural or propane gas within homes and other structures, is susceptible to failure when exposed to electrical arcing from appliances, as well as to indirect or direct lightning strikes, the ruling states.
They originally filed their complaint in federal court alleging violations of the Missouri Merchandising Practices Act, conspiracy and unjust enrichment, the ruling indicates. A federal judge for the Western District of Missouri dismissed the complaint without prejudice, which then prompted the plaintiffs to sue in state court on the same claims.
However, the plaintiffs added a claim for loss of benefit-of-the-bargain for the dimunition in the value of the structures containing CSST, the ruling states.
The defendants then removed the case, arguing that the plaintiffs had Article III standing based on the benefit-of-the-bargain claim, and sought to dismiss on the basis of failure to state a claim.
"The district court ruled that the benefit-of-the-bargain claim failed to bolster the claims enough for Article III standing," the ruling states. "The court granted George’s motion to remand."
In ruling on the defendants' appeal, the panel of judges – which included James Loken, Pasco Bowman and Duane Benton – held that Article III extends judicial power only to cases and controversies, and that plaintiffs have the burden to establish that injury was suffered in fact, that the alleged injury is fairly traceable to the challenged conduct of the defendants and that they are likely to be redressed by a favorable court decision.
"George’s assertions of paying more than CSST is worth and the consequent loss in value of the structures are economic injury sufficient to establish Article III standing," the panel held in reversing the lower court.
The panel remanded for further proceedings.