James Bernard was injured by a lawn mower manufactured and sold in 1967 by the Kee Manufacturing Company (“Old Kee”). In 1972, a new company called Kee Manufacturing Company, Inc. (“New Kee”) purchased the assets of Old Kee. These assets included the factory, inventory, goodwill, and the right to use the trade name “Key Mowers” and the business name “Kee Manufacturing Company.” Nevertheless, New Kee, by the terms of its acquisition, did not agree to assume the legal liabilities or obligations of its predecessor, Old Kee.

Moreover, the former owner of Old Kee had no interest in the new company.

Under its new owner, New Kee used Old Kee’s assets to continue the manufacture of lawn mowers, maintaining the same factory and employees and using the same trade name, but at the same time, New Kee discontinued the manufacture of the particular model that injured Mr. Bernard. Although New Kee’s brochure states that it has been manufacturing lawn mowers since 1948, New Kee is operated under a new management team.

CASE QUESTIONS

1. In your opinion, should the court impose successor liability based on the facts of this case? Why or why not?

2. Would your answer to question 1 change if New Kee had chosen a different name for its business?