Nathan Kimmel, Inc. v. Dowelanco

The court holds that the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) does not preempt a plastic company's state-law damage claim against a pesticide manufacturer for intentional interference with a prospective economic advantage. The company produces a nylon polymer bag intended to be used as protection for food and medicine when the pesticide Vikane is sprayed. The manufacturer produces Vikane and a bag to be used with it. After the manufacturer learned of the company's production of a bag, it applied to the U.S. Environmental Protection Agency (EPA) to change the Vikane label to require the use of only the manufacturer's bag during Vikane fumigation. The manufacturer predicated the change on the alleged conclusion that its bag was the most reliable. EPA allowed the amendment and, subsequently, a state began citing and fining any fumigator using bags other than the manufacturer's. The company sued claiming that because the manufacturer's own test revealed that its bag was not the most reliable, the manufacturer submitted false and misleading statements to EPA in order to exclude the company from the polymer bag market. The district court held that FIFRA preempted the company's claims.

The court first holds, however, that FIFRA §136v(b) only preempts state damage actions that impose requirements "in addition to or different from" FIFRA's requirements. The company's claims for intentional interference with prospective economic advantage imposes no such requirements. The claim is based on the manufacturer's alleged purposeful submission of false information to EPA in an attempt to interfere with the company's business relationships. The duty that the company would impose through its state-law action is a duty to refrain from knowingly submitting falsehoods in pesticide labeling applications, and FIFRA §§136j(a)(2)(M) and 136j(a)(2)(Q) deem it unlawful to knowingly submit false information to EPA during a pesticide's registration. The court therefore holds that the duty forming the basis of the company's claim is not in addition to or different from FIFRA's federal requirements. Instead, the company-imposed duty duplicates FIFRA's preexisting requirements and, thus, is not preempted.

Counsel for Plaintiffs
Joel R. Bennett
Bennett & Fairshter
225 S. Lake Ave., 9th Fl., Pasadena CA 91101
(626) 568-1200

Counsel for Defendant
Dean T. Barnhard
Barnes & Thornburg
1313 Merchants Bank Bldg.
11 S. Meridian St., Indianapolis IN 46204
(317) 638-1313

Trott, J. Before Hug and Fletcher, JJ.