947 F.3d 1251
10th Cir.2020Background
- On August 16, 2012, David Morgan was killed when a chemical tote crushed him while he operated a forklift at a warehouse owned by Baker Petrolite (a subsidiary of Baker Hughes).
- Katherine Morgan sued Baker Hughes for direct negligence, alleging Baker Hughes exercised control over subsidiary safety operations that caused the death.
- First trial: district court granted Baker Hughes JMOL at close of plaintiff's case; Tenth Circuit reversed in Morgan I, finding sufficient evidence for a reasonable jury to infer parent control.
- Second trial: jury returned a verdict for Baker Hughes; Morgan appealed, challenging jury instructions, denial of JMOL, and sought certification to the Wyoming Supreme Court.
- The Tenth Circuit considered whether Wyoming law requires the control standard of Restatement (Second) of Torts § 414 and whether Loredo and Horr are consistent.
- Court held Wyoming law aligns with Restatement § 414 and its commentary; district court’s jury instructions were correct and the judgment was affirmed. Morgan’s certification request was denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper standard for parent corporation direct negligence (level of control) | Loredo is inconsistent; correct test is § 414 (per Horr) — lower level of retained control suffices | Loredo sets the standard; parent liability requires control to the degree of directing how an aspect should be done | Court: Wyoming law adopts § 414 and its commentary; Loredo and Horr are consistent and require retention/exercise of control so contractor/subsidiary is not entirely free to do work its own way |
| Whether to certify question to Wyoming Supreme Court | Useful because Morgan reads Loredo and Horr as irreconcilable | No certification; Wyoming precedent provides clear guidance | Denied: state law is sufficiently settled; court follows Wyoming precedents itself |
| Sufficiency-of-evidence JMOL challenge (post-verdict preservation) | Evidence (Baker Hughes safety guidelines) compelled JMOL under § 414 | Challenge was not preserved post-verdict; evidence was for jury | Court: Morgan failed to renew Rule 50(b) motion, so sufficiency challenge is not preserved and is not considered on appeal |
| Jury instructions accuracy (direct negligence vs respondeat superior) | Proposed instructions better reflect § 414 comments (including that only minimal control is required) and avoid implying respondeat superior | Court’s instructions tracked Morgan I and Wyoming precedent; minor phrasing flaws not reversible | Court: Instructions, read as a whole, correctly stated Wyoming law and did not abuse discretion; omission of particular phrasing from comment (a) not reversible error |
Key Cases Cited
- Loredo v. Solvay Am., Inc., 212 P.3d 614 (Wyo. 2009) (articulates parent liability test and applies § 414 commentary to parent-subsidiary context)
- Jones v. Chevron U.S.A., Inc., 718 P.2d 890 (Wyo. 1986) (adopts Restatement § 414 framework for owner/independent contractor liability)
- Fiscus v. Atl. Richfield Co., 773 P.2d 158 (Wyo. 1989) (parent liability requires assumption of independent legal duty via retained/exercised control)
- Merit Energy Co. v. Horr, 366 P.3d 489 (Wyo. 2016) (confirms § 414 and commentary as basis for direct negligence control inquiry)
- Morgan v. Baker Hughes Inc., [citation="728 F. App'x 850"] (10th Cir. 2018) (Morgan I) (Tenth Circuit reversed trial JMOL, framing the control question under Loredo/§ 414)