iLight Technologies, Inc. v. Clutch City Sports & Entertainment, L.P.
414 S.W.3d 842
Tex. App.2013Background
- Clutch City operated the Toyota Center and used an iLight Plexineon LED rooftop "Toyota" sign required by a naming-rights agreement with Toyota.
- The sign experienced a fire in 2007 (cause not investigated); iLight replaced affected sections for free. In 2009 the sign again caught fire, damaging the roof and sign; Clutch City later replaced 500–800 feet of the sign at a cost of $168,434.61.
- Clutch City sued iLight alleging strict products liability (manufacturing defect and marketing defect) and negligence, claiming the fire resulted from internal defects (e.g., solder bridging, contaminants, corrosion) in the LED strips.
- Experts (IAL and Clutch City’s engineer) found solder bridging and other anomalies in thermally damaged samples; experts disagreed or were inconclusive about whether defects deviated from iLight’s specifications or whether defects were the root cause versus design or external causes (cleaning).
- The jury found iLight liable for manufacturing defect and negligence and awarded roof repair, sign replacement, and $2,337,575 for loss-of-use damages; iLight appealed asserting legal insufficiency of the liability findings and damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Manufacturing defect—did product deviate from manufacturer specifications and was that deviation a producing cause of the fire? | Clutch City: experts showed solder bridging, contaminants, and corroded joints present from manufacture that could cause a short and fire. | iLight: no evidence of iLight’s specifications or that the soldering deviated from iLight’s intended manufacturing; experts’ opinions were conclusory and did not rule out design defects or other causes. | Court: Evidence legally insufficient—no proof product deviated from iLight’s specs or that a manufacturing defect was a producing cause; reversible error. |
| Negligence—did iLight’s conduct proximately cause the fire (e.g., failure to warn or change QC after learning of Marktech problems)? | Clutch City: iLight knew of supplier defects (Marktech litigation) but did not change QC, warn, or alter manufacturing and thus was negligent. | iLight: issues in Marktech litigation involved LEDs failing to illuminate, not overheating/fires; no evidence linking that defect to the fire here. | Court: Evidence legally insufficient—Clutch City failed to show but-for/proximate causation linking iLight’s knowledge or omissions to the fire; verdict reversed. |
| Loss-of-use damages—were $2,337,575 make-good damages supported by evidence? | Clutch City: compensated Toyota with alternate advertising valued at ~$4.675M while sign dark; sought loss-of-use measured by make-goods. | iLight: challenged legal sufficiency of loss-of-use award. | Court: Did not reach this issue because liability findings reversed; therefore no award could stand. |
Key Cases Cited
- BIC Pen Corp. v. Carter, 346 S.W.3d 533 (Tex. 2011) (manufacturing-defect causation standards)
- Ford Motor Co. v. Ridgway, 135 S.W.3d 598 (Tex. 2004) (product-defect causation and proof requirements)
- Ford Motor Co. v. Ledesma, 242 S.W.3d 32 (Tex. 2007) (distinguishing manufacturing vs. design defects)
- Cooper Tire & Rubber Co. v. Mendez, 204 S.W.3d 797 (Tex. 2006) (manufacturing-defect standard and causation)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (legal-sufficiency standard of review)
- City of San Antonio v. Pollock, 284 S.W.3d 809 (Tex. 2009) (expert opinion must be fact‑based, not conclusory)