Case of the Day: Rote v. Zel Custom Manufacturing

The case of the day is Rote v. Zel Custom Manufacturing LLC (6th Cir. 2016). Troy Rote was a guest at the home of Gary and Judith Buyer, in Ohio. One of the other guests, Edward Grimm, brought a rifle and some ammunition with him. Grimm invited others to fire the rifle. When Rote loaded the rifle, but before the bolt was closed, the round exploded, injuring his hand. He brought a product liability action against Fabrica Militar Fray Luis Beltran, which is also known as Dirección General Fabricaciones Militares, or DGFM. He claimed that DGFM had manufactured the ammunition.

DGFM moved to dismiss on the grounds that it was an instrumentality of the Republic of Argentina and was immune from suit under the FSIA. The district court denied the motion to dismiss on the grounds that the commercial activity exception, 28 U.S.C. § 1605(a)(2), applied. DGFM appealed.

The case is somewhat interesting because the nature of the activity, namely, manufacturing, is a quintessentially commercial activity. But as the court put it, the purpose of the activity could have been governmental, insofar as DGFM may have been making ammunition for the Argentine military or other militaries (the opinion doesn’t make clear whether this was in fact the case). The court held that it’s the nature of the activity, not its purpose, that controls.

The court considered but rejected the argument that ammunition manufactured for the military may sometimes, contrary to the intention of the sovereign manufacturer, get into the hands of ordinary consumers, and that the sovereign might, therefore, be haled into court for purely governmental activities. This may be right; but I note that the cases the court cited in support of the view that the nature, not the purpose, of the activity governs were commercial cases, not product liability cases. It’s one thing to say that breach of a contract for the sale of airplane parts is just like breach of a contract for the sale of paperclips. But is a personal injury resulting from a defective paperclip just like a personal injury resulting from, say, an assault rifle manufactured for the military that ends up, one way or another, in civilian hands?

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