Blitz USA (Gas Can Manufacturers) Chapter 11…Thanks to Ambulance-chasing lawyers!

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Blitz USABlitz USA Gas CanBlitz USA goes bankrupt!?? Open for comments below…what do you think of this craziness??

Like 19th century marauders, the trial bar attacks any business it thinks will cough up money in its raids. The latest victims are the people who make those red plastic gasoline cans.

Until recently, Blitz USA—the nation’s No. 1 consumer gasoline-can producer, based in Miami, Oklahoma—was doing fine. It’s a commoditized, low-margin business, but it’s steady. Sales normally pick up when hurricane season begins and people start storing fuel for back-up generators and the like.

Blitz USA has controlled some 75% of the U.S. market for plastic gas cans, employing 117 people in that business, and had revenues of $60 million in 2011. The Consumer Product Safety Commission has never deemed Blitz’s products unsafe.

Then the trial attorneys hit on an idea with trial-lawyer logic: They could sue Blitz when someone poured gas on a fire (for instance, to rekindle the flame) and the can exploded, alleging that the explosion is the result of defects in the can’s design as opposed to simple misuse of the product. Plaintiffs were burned, and in some cases people died.

Blitz’s insurance company would estimate the cost of years of legal battles and more often than not settle the case, sometimes for millions of dollars. But the lawsuits started flooding in last year after a few big payouts. Blitz paid around $30 million to defend itself, a substantial sum for a small company. Of course, Blitz’s product liability insurance costs spiked.

In June, Blitz filed for bankruptcy. All 117 employees will lose their jobs and the company—one of the town’s biggest employers—will shutter its doors. Small business owners have been peppering the local chamber of commerce with questions about the secondary impact on their livelihoods.

The tort-lawsuit riders leading the assault on Blitz included attorneys Hank Anderson of Wichita Falls, Texas; Diane Breneman of Kansas City, Missouri; and Terry Richardson of Barnwell, South Carolina. All told, they’ve been involved in more than 30 lawsuits against Blitz in recent years.

The rest of the plastic-can industry can’t be far behind, so long as there’s any cash flow available. The American Association for Justice’s (formerly the Association of Trial Lawyers of America) annual conference in Chicago this month will feature, with a straight face, a meeting of the “gas cans litigation group.”

The Atlantic hurricane season started June 1, and Blitz estimates that demand for plastic gas cans rises 30% about then. If consumers can’t find the familiar red plastic can, fuel will have to be carried around in heavy metal containers or ad-hoc in dangerous alternatives, such as coolers.

Trial lawyers remain a primary funding source for the Democratic Party, but stories like this cry out for a bipartisan counter-offensive against these destructive raids that loot law-abiding companies merely because our insane tort laws make them vulnerable.

A version of this article appeared July 23, 2012, on page A12 in the U.S. edition of The Wall Street Journal, with the headline: The Tort Bar Burns On.

http://online.wsj.com/article/SB10001424052702304765304577482620929586962.html

{ 12 comments… read them below or add one }

KIt September 9, 2014 at 10:53 am

I like my 2 hand gas can. Where can I get a new spout for it?

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KIt September 9, 2014 at 10:51 am

So where do I get a replacement lid. I really like my 2 handled gas can?

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William Bailey August 30, 2012 at 2:39 pm

I am a former Blitz USA employee of nearly 20 years, Plant Manager, Production Supervisor, Warehouse Manager, Quality Specialist. The evidence is there. Keep digging.

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John Zehrbach August 7, 2012 at 7:51 am

A flame arrestor is not required when there is no spark or flame, ie a filinig station has no flame arestor. All gas cans I have seen specfically state do not use near flame or spark.

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Kevin August 7, 2012 at 3:43 pm

Excellent point.

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John Zehrbach August 7, 2012 at 7:47 am

I have used gas cans for 40 years even as a kid. I was taught to respect gasoline and anything flamable never had a problem.

Seems to me if we want risk free society we have to do two things.
Eveytime you buy something you sign a waiver stating you are responsbile for use product as intended and any missuse you cannot sue. It also states that the way in which you used it and an accident occurs was the only possible way to use it, it is on your dime to prove otherwise. If you refuse to sign the waiver you have to be licensed in the use of a product at your expense in order to pruchase the item.

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Kevin August 7, 2012 at 3:43 pm

Agreed…although, the way our country is set up currently, anyone can sue anyone for any reason, and it’s the responsibility of the defendant to pay his own court fees. In Britain, they make the loser of the case pay for both sides fees…which makes perfect sense to me, and that one change, in and of itself, would get rid of a lot of frivilous suits, AND keep “out of court settlements” less likely at the same time. In this scenario, the winner REALLY wants to win…and not give money away in a settlement, essentially “playing not to lose”.
It’s a really messed up system we have here…for sure needs some revamping…right away!

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William Bailey August 2, 2012 at 12:42 pm

Dude your story is wrong. Check out Green vs. Blitz

Check out WPI , Elias report
Check out Bear Engineering, Berkly California
Check out CARB of California for fines Blitz has paid
Destruction of documents in a litigation hold

this doesn’t even scratch the surface

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Kevin August 2, 2012 at 4:57 pm

William:
The article was written by the Wall Street Journal…and I didn’t check their facts before posting it…I thought they were a pretty good source that didn’t need verification.

So, now I’m doing the research, in hindsight. Following your suggestions, when searching for Green vs. Blitz, I found this:
http://www.applieddiscovery.com/ws_display.asp?filter=Case%20Summaries%20Detail&item_id={1DE5CA88-742C-400D-88E0-88840DB3617B}

A snippet from the above link: “Defendant, a manufacturer of gasoline containers, was named in several product liability lawsuits, including this case in which plaintiff alleged that her husband’s death was caused in part by the lack of a flame arrestor on defendant’s gas cans. The jury in plaintiff’s case returned a verdict for defendant after counsel for defendant argued that “science shows” that flame arrestors did not work. ”

Ok…so the jury found that Blitz didn’t do anything “wrong”, per se, according to what I’m reading there.

When I searched for WPI, Elias report, I found this:
http://www.wpi.edu/Pubs/ETD/Available/etd-100611-165339/unrestricted/Elias.pdf

Doesn’t look like he’s saying anything other than proving that there is indeed an issue with flammability of gas cans at certain degrees of pouring, while pouring on an open flame…however, maybe I missed a part? He tested at least three manufacturers…and found the same with all three. To be clear, there was nothing specific about what Blitz did “wrong”, that I was able to find. And, we already knew that pouring fuel on an open flame, or hot steel, was a bad idea…nothing really new there to report, so far as I could tell…

When searching for Bear Engineering, I found this: http://www.bearinc.com/projects/fireexplosions.html . Again, nothing specific to Blitz…just reiterating that pouring fuel on hot metal or on open flame, can indeed result in an explosion…which we already knew.

So…what am I missing? How is the Wall Street Journal article “wrong”, William?

-Kevin

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Bill Smith February 6, 2013 at 2:00 pm

Green v. Blitz I think you missed the fact that Blitz was sanctioned a quarter of million dollars for not producing documents.

In the Bearing Engineering document you must have missed the following, “Our work has also shown that an inexpensive flame arrester (a screen no finer than a window screen) would prevent these explosions.”

Would be the equivalent of manufacturing vehicles without seat belts.

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The Equalizer August 22, 2013 at 9:55 pm

@Bill Smith…you must be a democRat or a scum sucking trial lawyer.

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Bruce July 16, 2014 at 8:23 pm

I agree with you on that. You can NOT idiot proof everything from coffee cups to airplanes. If someone takes the screen out for a faster pour and gets hurt, Bill Smith will say “there should have been a warning on the can”. “It should have been more difficult to remove”. Duh.

The jurors are not much better than the lawyers. What’s wrong with people in America? I have relatives in the Netherlands and they joke about this. The judge would say “you are stupid to pour gasoline on a fire! Get out of here!”

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