Wis. Jury Says Quad/Graphics and Insurer Entitled to $63 Million

Quad/Graphics and its insurer are entitled to $63 million in damages from the 2002 collapse of a shelving system that ignited a fire at the publishing giant’s Lomira plant, according to a jury verdict.

The jury deliberated for 2 1/2 days before dividing fault among three manufacturers on Thursday: HK Systems of New Berlin, deemed 51 percent responsible; Rack Structures Inc. of Livonia, Mich., found 39 percent responsible; and Leavitt Tube Co. of Chicago, held 10 percent responsible.

Milwaukee County Circuit Judge Elsa Lamelas determined the overall damage amount, although how that amount will be divided among the manufacturers is still unknown, said Bruce Schultz, one of Quad/Graphics’ lawyers. Some manufacturers or their insurers already paid some of the damages, while other defendants settled with Quad/Graphics for undisclosed sums before the trial began.

At issue was the July 2002 collapse of an automated shelving system in a two-month-old storage building. A number of welds in the shelving supports were found to be defective but Schultz said the company was told during a meeting that the building could still be used.

“If you market, if you sell a defective product and it causes harm, you are responsible,” Schultz told the jury during closing arguments.

Lawyers for the defendants had argued that Quad/Graphics bore some responsibility for the accident because the company was aware of the problems.

The shelf collapse ignited a fire that burned for three weeks, destroying the building in which an estimated 108 million pounds of paper were stored. All Quad/Graphics employees evacuated safely but a contractor died when his car was crushed by debris.

According to court records, Leavitt made the 100-foot tubes that ran from the floor to the ceiling; HK designed the system, and Rack Structures built the shelves.

Sussex, Wis.-based Quad/Graphics is the world’s largest privately held printing operation, with 12,000 employees worldwide.

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Received Id 1120626600 on Sep 28 2007 22:35