Port Authority of New York and New Jersey v. Arcadian Corp Dyno Nobel Inc, F/k/a, Ireco Incorporated Hydro Agri North America, Inc

This case arises from the February 26, 1993, terrorist detonation of an explosive device under the World Trade Center in New York City, which caused six deaths, many injuries and massive property damage. Plaintiff-appellant, the Port Authority of New York and New Jersey, owner of the World Trade Center, sued defendants, manufacturers of fertilizer products, on theories of negligence and products liability, alleging that the terrorists used defendants' fertilizer products to construct the explosive device.

The District Court, in a thorough and well-reasoned opinion, granted defendants' motion to dismiss for failure to state a claim upon which relief may be granted under Fed. R. Civ. P. 12(b)(6). Plaintiff appealed. We find that it was appropriate, in light of the record, for the District Court to dismiss the action under Rule 12(b)(6). Specifically, we agree with the District Court that as a matter of law defendants owed no duty to plaintiff and that the World Trade Center bombing was not proximately caused by defendants' actions. Furthermore, we reject plaintiff's argument that the issues of duty and proximate causation were jury issues not properly decided by the court on a Rule 12(b)(6) motion. Accordingly, we will affirm the judgment of the District Court.

The Port Authority of New York and New Jersey is the owner of the World Trade Center in New York City. On February 26, 1993, a bomb, which had been fabricated by terrorists out of ammonium nitrate, urea, and nitric acid, exploded in an underground parking garage at the World Trade Center, causing six deaths, many injuries and massive property damage.

The ammonium nitrate, urea, and nitric acid used in the bomb were allegedly sold in New Jersey, and the bomb was allegedly assembled in New Jersey by New Jersey residents. Defendants Hydro-Agri North America, Inc., and Dyno Nobel Inc., formerly known as Ireco, Inc., are alleged to have manufactured, designed, marketed, distributed and/or sold the ammonium nitrate used by the terrorists. Defendant Arcadian Corporation is alleged to have manufactured, designed, marketed, distributed and/or sold the urea used by the terrorists.

The ammonium nitrate and urea, alleged to have been purchased by the terrorists, were sold in prill form, i.e., a white, round, hardened droplet about the size of the tip of a ball point pen. The prills were manufactured to be used as fertilizer. The ammonium nitrate prills can be rendered explosive by the addition of fuel oil or other sensitizing substances; the urea prills can be rendered explosive by the addition of nitric acid and water (forming urea nitrate). The terrorists are alleged to have rendered the prills explosive by adding these substances. Defendants point out that, as conceded in the Amended Complaint, the prills are not explosive in and of themselves.

Plaintiff alleges that defendants knew or should have known that the ammonium nitrate and urea could easily be made into explosives and that terrorists had used them prior to the bombing at the World Trade Center, but nevertheless defendants failed to take appropriate steps to render their products non-detonable. Specifically, plaintiff points to two incidents. First, an explosion of ammonium nitrate over fifty years ago destroyed two ships docked at Texas City, Texas, killing 468 persons and causing extensive damage in the city. Second, more than thirty years ago, anti-war protesters used ammonium nitrate to bomb the Mathematics Research Building at the University of Wisconsin, leading to injuries, death and property damage.

Plaintiff alleges that defendants had the means to reduce the danger of their products. In 1968, Samuel Porter patented a process that rendered ammonium nitrate fertilizers non-detonable. The process called for adding five to ten percent of diammonium phosphate, a high grade of fertilizer, to ammonium nitrate at a nominal additional cost. When the patent was made available to ammonium nitrate manufacturers, one of the explicit purposes was to deter the criminal use of ammonium nitrate in bombs. In 1985, the Porter patent entered the public domain, making the process available to all manufacturers free of license or royalty.

Plaintiff alleges that the danger of these products prompted governments here and abroad to attempt to regulate their manufacture and distribution. Specifically, in response to the University of Wisconsin bombing, several states introduced legislation to require that all ammonium fertilizers be desensitized by a chemical agent (as described in the Porter patent) to reduce, if not eliminate, the explosive properties of ammonium nitrate. The legislative efforts were allegedly well publicized, including within the fertilizer industry, but plaintiff asserts that various fertilizer manufacturers resisted the legislation, leading to its ultimate defeat.

In addition, in 1975, the European Economic Community Council issued a directive that established (1) strict standards for the formulation of solid ammonium nitrate and (2) detonation tests that could be required by member countries to ensure that fertilizer sold in those countries had a low potential for use as explosive. Belgium, Denmark, Germany and the Netherlands prohibited the sale of certain ammonium nitrate fertilizers. France mandated that all ammonium nitrate fertilizer be tested by detonation.

Three years prior to the EEC directive, terrorist bombings in Northern Ireland and the Republic of Ireland prompted the United Kingdom and Ireland to enact regulations that were even more stringent. Those regulations limited the amount of nitrate that could be used in fertilizer products and required the addition of calcium, sulfates, and other materials to reduce their detonability.

Information about urea and the means to desensitize it was allegedly similarly well known, yet not utilized, prior to the World Trade Center bombing. It was allegedly known that the addition of phosphate and other additives to urea prills would decrease or eliminate their use as explosive and energetic materials. Explosives made of urea nitrate were allegedly used in the Middle East, South America, Pakistan and the United States prior to the World Trade Center bombing. In 1992, the sales of urea and ammonium nitrate fertilizer were banned in Peru as a result of the extensive use of urea and ammonium nitrate prills in explosives set off by the Shining Path terrorists.

Plaintiff filed this action on February 26, 1996, in the Superior Court of New Jersey in Essex County. Defendants removed the actions to the United States District Court for the District of New Jersey on the grounds of diversity of citizenship. Plaintiff filed an Amended Complaint before defendants responded to the original Complaint, in order to correct the name of one of the defendants.

The Amended Complaint asserts three grounds for holding defendants liable. Count I, a claim of negligence, asserts that defendants "negligently failed to design, manufacture, market, distribute and/or sell [ammonium nitrate or urea prills] with a formulation" that would either "render them less detonable or non-detonable" or "decrease or eliminate their explosive properties." Count II, a claim in strict liability, asserts that defendants are liable because the ammonium nitrate and urea prills were "unreasonably dangerous and defective when they left the respective control of each of the Defendants." Count III asserts that defendants are liable because they "failed to provide guidelines, instructions, and/or warnings to their distributors, retailers, dealers or other suppliers to confirm that buyers in the general and unrestricted public market have legitimate and lawful purposes for use of Defendants' products." Defendants filed a Motion to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6). The District Court granted the motion and dismissed the Complaint with prejudice. See Port Authority of New York & New Jersey v. Arcadian Corp., 991 F. Supp. 390 (D.N.J. 1997). Plaintiff filed a timely appeal.

The standard of review of a district court order dismissing a complaint under Fed. R. Civ. P. 12 (b)(6) is plenary. Alexander v. Whitman, 114 F.3d 1392, 1397 (3d Cir. 1997). The court "must determine if plaintiff may be entitled to relief under any reasonable reading of the pleadings, assuming the truth of all the factual allegations in the complaint." Id. (citations omitted). "A court may dismiss a complaint only if it is clear that no relief could be granted under any set of facts that could be proven consistent with the allegations." Id.

The District Court had diversity jurisdiction pursuant to 28 U.S.C. S 1332. Because this is an appeal from a final order of the District Court, we have jurisdiction pursuant to 28 U.S.C. S 1291.

As an initial matter, the District Court found it was not necessary to make a determination whether New York or New Jersey law applies to the Amended Complaint. Instead, the District Court determined that the Amended Complaint failed to state a claim under the law of either state. The District Court's approach was appropriate. A federal court sitting in diversity applies the choice of law principles of the forum state. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496-97 (1941). Under New Jersey law, when the same result -- dismissal of a complaint -- is required under the laws of all relevant jurisdictions, the court need not decide which law would apply to the action. See Rohm & Haas Co. v. Adco Chem. Co., 689 F.2d 424, 429 (3d Cir. 1982); Mueller v. Parke-Davis, 599 A.2d 950, 954 (N.J. Super. Ct. App. Div. 1991). Because we agree that dismissal is required under both New Jersey and New York law, we similarly need not decide the choice of law issue.

D. The District Court's Application of Fed. R. Civ. P. 12(b)(6)

We first address plaintiff's argument that the District Court erred in failing to recognize the legal sufficiency of the Amended Complaint pursuant to Fed. R. Civ. P. 12(b)(6). Plaintiff argues that, although the District Court quoted the correct standard under Rule 12(b)(6), it misapplied it to the case. In essence, plaintiff contends that the Amended Complaint alleges facts sufficient to plead the elements of the causes of action (under either jurisdiction) but that the District Court elected to conclude that a jury could not rule in favor of plaintiff under any set of facts consistent with the Amended Complaint. Plaintiff argues that this ruling was premature and inconsistent with the mandate that the District Court must interpret allegations in the light most favorable to the plaintiff. Plaintiff argues that, in dismissing the complaint, the District Court made rulings on factual issues of foreseeability and proximate cause, which are traditionally the province of the jury. In sum, plaintiff claims that the District Court exceeded its limited role in reviewing the sufficiency of a complaint and that plaintiff is entitled to discovery and to present evidence to a jury because the allegations in the Amended Complaint are sufficient.

We find, however, that the District Court applied the standard correctly. Thus, the District Court assumed that the facts alleged in the Amended Complaint were true but determined that the facts, even if true, could not legally support plaintiff's claims. Plaintiff disagrees with this conclusion in two respects. First, plaintiff contends that the District Court's task was merely to go through a check list for the elements of a tort claim. Consequently, since the Amended Complaint contained all the elements of the causes of action pled, the motion to dismiss should have been denied. Rule 12(b)(6), however, is designed to screen out cases where "a complaint states a claim based upon a wrong for which there is clearly no remedy, or a claim which the plaintiff is without right or power to assert and for which no relief could possibly be granted . . .." Melo- Sonics Corp. v. Cropp, 342 F.2d 856, 859 (3d Cir. 1965) (quoting Leiman v. State Mutual Life Assurance Co., 108 F.2d 302, 305-06 (8th Cir. 1940)). We find that the District Court carried out this mandate by taking all the allegations in the Amended Complaint as true and making every favorable inference in favor of plaintiff but deciding nevertheless that no relief could be granted.2

Second, we disagree with plaintiff's insistence that the District Court misapplied Rule 12(b)(6) by considering whether plaintiff's claims were sufficient as a matter of "fairness" or "sound policy." Plaintiff argues that such considerations improperly substituted the court's views for those of the jury. Plaintiff, however, misunderstands the role of the courts in developing and administering the tort system. Tort law is essentially concerned with the "allocation of losses" arising out of "socially unreasonable conduct." Prosser & Keeton, The Law of Torts, S 1 at 6. The courts must consider not only the interests of the litigants but also the interests of society in general, including the social and economic costs of any expansion of the outer boundaries of tort liability. Id. This consideration necessarily involves considerations of social and public policy. Id.

As we will explore more fully below, the legal bounds of duty and of proximate cause are aspects of tort law in which issues of fairness and public policy are particularly relevant. We conclude that the District Court properly considered questions of fairness and policy and made rulings of law on issues of reasonable foreseeability and proximate causation. Moreover, a jury would be asked to determine if a duty had been violated or if the harm in question had been proximately caused by the defendants only after the court had determined as a matter of law either that defendants did have a duty to safeguard plaintiff from the risk of these bombs or that the defendants' supplying the terrorists with a component of these bombs was a legal proximate cause of plaintiff's damages. Because the District Court found as a matter of law that there was no duty and no proximate causation, there was nothing for a jury to consider.

The District Court properly concluded that the Amended Complaint failed to establish the existence of a duty owed by defendants. Under both New Jersey and New York law, the question of whether a duty is owed is a question of law to be decided by the court. Strachan v. John F. Kennedy Mem'l Hosp., 538 A.2d 346, 349 (N.J. 1988) ("The question of whether a duty exists is a matter of law properly decided by the court. . . ."); Purdy v. Public Adm'r , 526 N.E.2d 4, 6 (N.Y. 1988) ("The question of whether a member or group of society owes a duty of care to reasonably avoid injury to another is of course a question of law for the courts.").

Under the law of either jurisdiction, it is appropriate for us to focus on product liability principles in determining if defendants did owe plaintiff a duty. Under New Jersey law negligence is no longer viable as a separate claim for harm caused by a defective product. Oquendo v. Bettcher Indus., Inc., 939 F. Supp. 357, 361 (D.N.J. 1996) (citing Tirrell v. Navistar Int'l, Inc., 591 A.2d 643 (N.J. Super. Ct. App. Div. 1991)). Even though plaintiff alleges a negligence claim in Count I, this count is based solely on harm caused by defendants' allegedly defective products. It therefore falls within the New Jersey Product Liability Act (the "NJPLA"), N.J.S.A. 2A:58C-1 et seq., which is "the sole basis of relief under New Jersey law available to consumers injured by a defective product." Repola v. Morbark Indus., Inc., 934 F.2d 483, 492 (3d Cir. 1991). Similarly, under New York law, theories of negligence and strict liability for design and warning defects are functionally equivalent. Elsroth v. Johnson & Johnson, 700 F. Supp. 151, 158 n.9 (S.D.N.Y. 1988) (citing DeRosa v. Remington Arms Co., 509 F. Supp. 762, 766 (E.D.N.Y. 1981), and Cooley v. Carter-Wallace, Inc., 478 N.Y.S.2d 375, 379 (App. Div. 1984)). A "plaintiff can recover nothing in negligence on his products claims that he cannot first recover under his strict liability claims asserting product, design, and warning defects." Id. at 158.

We find that defendants owed no duty to plaintiff under either New Jersey or New York law. First, the manufacturer of a raw material or component part that is not itself dangerous has no legal duty to prevent a buyer from incorporating the material or the part into another device that is or may be dangerous. By plaintiff's own allegations, defendants' products were not in and of themselves dangerous but were merely the raw materials or components that terrorists used in combination with other ingredients to build a bomb. Second, manufacturers have no duty to prevent a criminal misuse of their products which is entirely foreign to the purpose for which the product was intended.

The New Jersey Supreme Court examined the duties of a component manufacturer in Zaza v. Marquess & Nell, Inc., 675 A.2d 620 (N.J. 1996). In that case, the plaintiff was injured when hot water and carbon overflowed from a quench tank he was attempting to unclog. The quench tank was a component part of a coffee bean decaffeination process. The defendant, who had manufactured the quench tank, knew from designs that, once integrated into the larger system, the tank would need certain safety devices. Nevertheless, the New Jersey Supreme Court held that the component part manufacturer owed the plaintiff no duty regarding any danger posed by the integrated device, stating that a component part fabricator may only be held "strictly liable for injury caused by a defective component where the defect is in the component part and the part did not undergo substantial change after leaving the manufacturer's hands." Id. at 636.3 The court relied on a tentative draft of the Restatement (Third) of Torts, in which the American Law Institute "concluded that a component part manufacturer generally is not liable unless the component part is defective or the component provider substantially participated in the design of the final product." Id. at 629. The court also followed the "majority of courts from other jurisdictions [which] have held that a manufacturer of a component part, which is not dangerous until it is integrated by the owner into a larger system, cannot be held strictly liable to an injured employee for the failure of the owner and/or assembler to install safety devices." Id.

In the instant case, there is no allegation that the fertilizer products were dangerous in and of themselves. Under plaintiff's own allegations, the raw ammonium nitrate and urea sold by defendants were not explosive until the terrorists purposefully manipulated and adulterated them by mixing them together with additional chemicals such that they were transformed into energized materials that could be incorporated into an explosive charge. The danger to plaintiff was presented not by the raw materials, but by a bomb that incorporated the raw materials after they had been substantially altered. In addition, defendants had no control over the fertilizer once it was sold and no control over the final assembly of the bomb.

Moreover, under the NJPLA, a plaintiff must prove "that the product causing the harm was not reasonably fit, suitable or safe for its intended purpose." N.J.S.A. 2A:58C- 2 (emphasis added); see also Zaza, 675 A.2d at 627 (stating that a "manufacturer has a duty to ensure that the products its places into the stream of commerce are safe when used for their intended purposes"). The "unforeseeable misuse of a product may not give rise to strict liability." Suter v. San Angelo Foundry and Mach. Co., 406 A.2d 140, 144 (N.J. 1979). "A product is not in a defective condition when it is safe for normal consumption and handling." Id. (quoting Restatement (Second) of Torts, S 402A cmt. h). Where "the use of the product is beyond its intended or reasonably anticipated scope," an injury resulting from that use is "not . . . probative of whether the product was fit, suitable, and safe." Id. There is no allegation here that the fertilizer products were unsafe for their intended purposes, that is, when used as fertilizer.

Plaintiff attempts to argue that defendants should be liable nonetheless because the New Jersey courts have held that a manufacturer's duty also encompasses objectively foreseeable misuses and alterations. See Oquendo, 939 F. Supp. at 362 (D.N.J. 1996) ("New Jersey courts have held manufacturers strictly liable for products, despite another's subsequent substantial alterations, where those alterations were objectively foreseeable and likely to cause injuries."); Jurado v. Western Gear Works, 619 A.2d 1312, 1317 (N.J. 1993) ("Hence, the plaintiff in a design-defect products liability suit may succeed even if the product was misused, as long as the misuse or alteration was objectively foreseeable."); Soler v. Castmaster, 484 A.2d 1225, 1232 (N.J. 1984) ("Thus, in the event of either a substantial alteration or misuse, the manufacturer will be responsible for resultant injuries to an operator if the alteration or misuse implicated in the actual use of the machine was foreseeable and could have been prevented or reduced by the manufacturer.").

We conclude, however, that the alteration and misuse of defendants' fertilizer products were not objectively foreseeable. We reject, therefore, plaintiff's attempt to hold defendants liable under this theory. The court in Oquendo set forth New Jersey law as follows:

Objective foreseeability means reasonable foreseeability. The standard "does not affix responsibility for future events that are only theoretically, remotely, or just possibly foreseeable, or even simply subjectively foreseen by a particular manufacturer." . . . Rather it "applies to those future occurrences that, in light of the general experience within the industry when the product was manufactured, objectively and reasonably could have been anticipated."

Oquendo, 939 F. Supp. at 362 (quoting Brown v. United States Stove Co., 484 A.2d 1234, 1241 (N.J. 1984)). Significantly, the fact that plaintiff alleges that defendants were aware of previous instances in which fertilizer products were used in bombs does not suffice to establish objective foreseeability. "Such knowledge . . . tends to show only subjective foreseeability, and . . . subjective foreseeability is irrelevant to the [objective] foreseeability determination." Id. at 363.

Plaintiff argued below, and again on appeal, that the issues of objective foreseeability and reasonableness should be left for a jury to decide. We recognize that these issues are indeed generally a matter to be determined by a jury. See Soler, 484 A.2d at 1234. An exception is to be made, however, where "the inferences are so clear that a court can say as a matter of law that a reasonable manufacturer could not have foreseen the change." Id. (quoting parenthetically Merriweather v. E.W. Bliss Co. , 636 F.2d 42, 45 (3d Cir. 1980) (quoting D'Antona v. Hampton Grinding Wheel Co., 310 A.2d 307 (Pa. Super. Ct. 1973)).

The inferences in this case are indeed so clear that we can say as a matter of law that the transformation and integration of the otherwise safe fertilizer products into the type of explosive device used in the World Trade Center bombing was not objectively foreseeable to the defendants at the time of this bombing. We agree with the District Court's conclusion that:

No jury could reasonably could conclude that one accidental explosion 50 years ago, one terrorist act in this country almost 30 years ago, and scattered terrorists incidents throughout the world over the course of the last 30 years would make an incident like the World Trade Center bombing anything more than a remote or theoretical possibility.

Port Authority of New York & New Jersey, 991 F. Supp. at 402-03.

We, of course, must follow the precedents of the New Jersey Supreme Court. Travelers Indemnity Co. v. DiBartolo, 131 F.3d 343, 348 (3d Cir. 1997). The District Court's conclusion is consistent with the refusal of the New Jersey Supreme Court to impose a duty in cases involving outrageous misuses of a product wholly unrelated to its intended purpose, where such a duty would expose manufacturers to endless liability. See, e.g. , Jurado, 619 A.2d at 1318 ("If . . . a plaintiff undertakes to use his power saw as a nail clipper and thereby snips his digits, he will not be heard to complain. . . .") (citation omitted); Suter, 406 A.2d at 144 ("[T]he manufacturer of a knife cannot be charged with strict liability when the knife is used as a toothpick and the user complains because the sharp edge cuts."); see also Taylor v. General Elec. Co., 505 A.2d 190, 193 (N.J. Super. Ct. App. Div. 1986) (holding that bleach manufacturer had no duty to warn against using plastic Clorox bottles to carry gasoline because such a duty would cover an infinite variety of misuses).

We agree with the District Court that imposing a duty on defendants in this case would be unfair. "Ultimately, the determination of the existence of a duty is a question of fairness and public policy. Foreseeability of injury to another is important, but not dispositive. Fairness, not foreseeability alone, is the test." Kuzmicz v. Ivy Hill Park Apartments, Inc., 688 A.2d 1018, 1020 (N.J. 1997). Indeed, it would be grossly unfair to impose a duty on defendants to anticipate and prevent the use of their products as one part of a terrorist's explosive device. Their products were not explosive in and of themselves, without being mixed with other substances and incorporated into a bomb.

Finally, imposing a duty in this case would expand the scope of manufacturers' liability under New Jersey law, a result contrary to the legislative policy of the NJPLA, which "has been interpreted as evincing a legislative policy to limit the expansion of products-liability law." Zaza, 675 A.2d at 627 (internal quote marks omitted). We leave such an expansion of duty to the legislature.

Similarly, under New York law, we find that no duty exists that would provide a basis for liability. The manufacturer of a component part is not liable for the ways in which a purchaser subsequently processes or integrates that product. In Munger v. Heider Mfg. Corp., 456 N.Y.S.2d 271, 273 (App. Div. 1982), the court held that manufacturers of component parts, not themselves defectively designed, could not be liable to one injured by the malfunction of the assembled unit. Indeed, under New York law, a manufacturer is not liable where its product became dangerous only due to substantial alteration even if the product is not a component part or raw material. In Robinson v. Reed-Prentice Div. of Package Mach. Co., 403 N.E.2d 440, 441 (N.Y. 1980), the New York Court of Appeals held that "a manufacturer of a product may not be cast in damages, either on a strict products liability or negligence cause of action, where, after the product leaves the possession and control of the manufacturer, there is a subsequent modification which substantially alters the product and is the proximate cause of plaintiff's injuries." In Robinson, the court rejected the plaintiff's attempt to hold a machine manufacturer liable for an injury caused because safety guards were removed, saying "[m]aterial alterations at the hands of a third party which work a substantial change in the condition in which the product was sold . . . are not within the ambit of the manufacturer's responsibility." Id. at 444.

Another New York case, Elsroth v. Johnson & Johnson, 700 F. Supp. 151 (S.D.N.Y. 1988), also establishes that a manufacturer cannot be held liable for failing to add a safety device to its product to prevent other substances from being combined with it. In that case, an individual laced Tylenol capsules with cyanide and replaced the deadly product on store shelves, causing a consumer to die after ingesting the capsules. Id. at 153-54. Thus, like the instant case, Elsroth concerned a criminal who injured a victim by adulterating the defendant's product. The plaintiff alleged that the manufacturer could have prevented the death by producing the drug in caplet form, which would have made it more difficult for a criminal to adulterate the product. Id. at 160, 163. The court rejected this argument, holding that "there exists no common law duty requiring . . . manufacturers to design their product in such a way as to anticipate and frustrate criminal tampering." Id. at 164.

This limiting principle is not altered even if the misuse of the product might be foreseeable. In Elsroth, the defendant's product had been tampered with in the same way four years earlier. Id. at 153. Similarly, in Robinson, the court concluded that the machine manufacturer had no duty to prevent disengagement of a safety device "however foreseeable that modification may have been." Robinson, 403 N.E.2d at 444; see also McCarthy v. Sturm, Ruger, and Co., 916 F. Supp. 366, 369 (S.D.N.Y. 1996) (holding as a matter of law that defendant, a manufacturer of ammunition, owed no duty to prevent the criminal misuse of ammunition, regardless of its foreseeability).

On appeal, plaintiff attempts to distinguish these New York cases on their facts but fails to provide any reason why the principles and rules articulated in them are inapplicable to this case. Plaintiff relies exclusively on the proposition that a manufacturer has a duty to make its product safe when "used for its intended purpose or for an unintended but reasonably foreseeable purpose." Lugo v. LJN Toys, Ltd., 552 N.E.2d 162, 163 (N.Y. 1990); Micallef v. Miehle Co., 348 N.E.2d 571, 577 (N.Y. 1976). The fatal flaw in the argument is that plaintiff ignores the more specific rule applicable here, that where a product has undergone substantial alteration after leaving the manufacturer's control and it is the alteration that creates the danger, the prevention of such alteration is not within the scope of the manufacturer's responsibility. Moreover, Lugo and Micallef, the cases cited by plaintiff, are merely examples of a manufacturer making a product that was unsafe even when used precisely in the manner that the manufacturer anticipated. See Lugo, 552 N.E.2d at 163; Micallef, 348 N.E.2d at 577. Neither case supports the imposition of liability on a manufacturer of fertilizer products, which are safe when used for their intended purposes but were rendered unsafe by terrorists who substantially altered the products so that they could be used for a violent purpose wholly foreign to their intended purposes.

Because no duty exists under the law of either New Jersey or New York, we find that it was appropriate for the District Court to dismiss the Amended Complaint for failure to state a claim upon which relief could be granted.