Green Plains Otter Tail, LLC v. Pro-Environmental, Inc.

Pro-Environmental Inc. (PEI) (defendant) designed, manufactured, and installed a regenerative thermal oxidizer (RTO) in a Minnesota ethanol-production plant operated by Green Plains Otter Tail, LLC (Green Plains) (plaintiff). The RTO burned off pollutants generated by ethanol production. Dampers on the RTO controlled the input and output of vapors. A hydraulic pump with an accumulator powered the dampers. The accumulator supplied the hydraulic fluid necessary to open and close the dampers. The accumulator required a periodic nitrogen recharge to operate. PEI gave Green Plains a manual that stated the user should periodically check and recharge the accumulator’s nitrogen levels by turning off the RTO, draining the hydraulic fluid, and attaching a charging and gauging assembly. The manual also stated, “It is suggested that a check be made a week after installation, and thereafter once a month.” Despite these instructions, Green Plains never checked or recharged the accumulator’s nitrogen levels. In 2014, the RTO’s hydraulic pump lost hydraulic pressure, causing the dampers to fail. As a result, an explosion occurred, damaging the RTO, other machinery, and buildings at the plant. Green Plains sued PEI for strict products liability, alleging the RTO’s defective design. Specifically, Green Plains argued that the RTO’s design was defective and unreasonably dangerous because the dampers required hydraulic pressure and a nitrogen-charged accumulator to operate, whereas other safer designs on the market used compressed air or weights to operate the dampers. PEI argued that Green Plains’ failure to check and recharge the accumulator was a superseding cause that relieved PEI of liability. The district court agreed and granted summary judgment for PEI. Green Plains appealed to the Eighth Circuit.