Texas Supreme Court Offers Causation Guidance in Mesothelioma Cases

The Texas Supreme Court ruled that a defendant will not have to pay a $12 million verdict in an asbestos case because there was inadequate proof the company’s products actually caused the alleged injury. See Bostic, et al. v. Georgia-Pacific Corp., No. 10-0775 (Texas 7/11/14).

In Borg-Warner Corp. v. Flores, 232 S.W.3d 765 (Tex. 2007), the court had discussed the standards imposed by Texas law for establishing causation in asbestos-disease cases. Flores had concerned a plaintiff suffering from asbestosis. This case involved mesothelioma, and the court held that the standard of substantial factor causation recognized in Flores also applied to mesothelioma cases.  The court did not impose a strict but-for causation standard, but held that the plaintiffs had failed to offer legally sufficient evidence of causation, and accordingly it affirmed the lower court's judgment.

Under section 431 of the Restatement Second of Torts, the Texas court had held that to establish causation in fact the plaintiff must prove that the defendant’s product was a substantial factor in causing the disease, and that mere proof that the plaintiff was exposed to “some” respirable fibers traceable to the defendant was insufficient. The word substantial is used to denote the fact that the defendant’s conduct has such an effect in producing the harm as to lead reasonable persons to regard it as a cause, using that word in the sense of responsibility.  Proof of mere frequency, regularity, and proximity of potential exposure to asbestos (sufficient in some states) is in Texas
necessary but not sufficient, as it provides none of the quantitative information necessary to support causation under Texas law.  While the plaintiff was not required to establish causation with “mathematical precision,” the court clearly required defendant-specific evidence relating to the approximate dose to which the plaintiff was exposed, coupled with evidence that the dose was a substantial factor in causing the asbestos-related disease.

In rejecting a standard that “some” exposure would suffice, the court recognized that most chemically induced adverse health effects clearly demonstrate thresholds; so, there must be reasonable evidence that the exposure was of sufficient magnitude to exceed the threshold before a likelihood of causation can be inferred. Plaintiffs urged that the standards established in Flores were not applicable in a mesothelioma case because relatively smaller quantities of asbestos can result in mesothelioma.  The court concluded that the Flores framework for reviewing the legal sufficiency of causation evidence lent itself to both types of cases. Even in mesothelioma cases proof of “some exposure” or “any exposure” alone will not suffice to establish causation. While the experts in this case testified that smaller amounts of asbestos exposure can result in mesothelioma, that fact alone does not merit a different analysis. With both asbestosis and  mesothelioma, the likelihood of contracting the disease increases with the dose. 

The court noted that If any exposure at all were sufficient to cause mesothelioma, everyone would suffer from it or at least be at serious risk of contracting the disease. Everyone is exposed to asbestos in the ambient air; it is plentiful in the environment, especially if you’re a typical urban dweller.  Plaintiff's expert confirmed that we all have some asbestos in our lungs, but that background levels are sufficiently low that they do not cause disease; instead, multiples of fibers many times over were required to cause mesothelioma.

More fundamentally, if the court were to adopt a less demanding standard for mesothelioma cases
and accept that any exposure to asbestos is sufficient to establish liability, the result essentially
would be not just strict liability but absolute liability against any company whose asbestos-containing product crossed paths with the plaintiff throughout his entire lifetime. However, exposure does not always result in disease. The court said it had never embraced the concept of industry-wide liability on grounds that proof of causation might be difficult. 

If an “any exposure” theory of liability was accepted for mesothelioma cases because science
has so far been unable to establish the precise dose below which the risk of disease disappears, the same theory would arguably apply to all carcinogens. The any exposure theory effectively accepts that a failure of science to determine the maximum safe dose of a toxin necessarily means that every exposure, regardless of amount, is a substantial factor in causing the plaintiff’s illness. This approach negates the plaintiff’s burden to prove causation by a preponderance of the evidence.

Further, said the court, there are cases where a plaintiff’s exposure to asbestos can be tied to a defendant, but that exposure is minuscule as compared to the exposure resulting from other sources. Proof of any exposure at all from a defendant should not end the inquiry and result in automatic liability. The Restatement Third of Torts provides that when an actor’s negligent conduct constitutes only a trivial contribution to a causal set that is a factual cause of harm, the harm is not within the scope of the actor’s liability.

The any exposure theory is also illogical in mesothelioma cases, where a small exposure can
result in disease, because it posits that any exposure from a defendant above background levels
could impose liability, while the background level of asbestos should be ignored. But the expert
testimony in this case was undisputed that the background level varies considerably from location
to location. The court could not see how the theory can, as a matter of logic, exclude higher than normal background levels as the cause of the plaintiff’s disease, but accept that any exposure from an individual defendant, no matter how small, should be accepted as a cause in fact of the disease. Under plaintiffs'  any exposure theory a background dose of 20 does not cause cancer, but a defendant’s dose of 2 plus a background dose of 5 somehow does.

Expanding on the notion of substantial factor, the court noted that in the Havner decision it had enunciated principles in toxic tort cases that (1) expert testimony of causation must be scientifically reliable, (2) the plaintiff must establish the elements of his claim by a preponderance of the evidence, and (3) where direct evidence of causation is lacking, scientifically reliable evidence in the form of epidemiological studies showing that the defendant’s product more than doubled the plaintiff’s risk of injury appropriately corresponds to the legal standard of proof by a preponderance of the evidence. These principles, said the court, should apply to asbestos cases. As to the
availability of scientific studies, asbestos-related disease has been researched for many decades and the population of potentially affected persons numbers in the millions. A more than doubling of the risk must be shown through reliable expert testimony that is based on epidemiological studies or similarly reliable scientific testimony. 

Multiple-exposure cases raise the issues of how the finder of fact should consider exposure
from sources other than the defendant, what proof might be required as to those other sources, and who has the burden of proof regarding those other sources. These are difficult questions, said the court, but a plaintiff should be required to establish more than a doubling of the risk attributable to the defendant’s product;  the court did not require a plaintiff to track down every possible source of asbestos exposure and disprove that those other exposures caused the disease. In multiple-exposure cases few if any plaintiffs could ever establish which particular fibers from which particular defendant caused the disease.  However, when evidence is introduced of exposure from other defendants or other sources, mere proof of more than a doubling of the risk may not suffice to establish substantial factor causation. Suppose, hypothesized the court, a plaintiff shows that his exposure to a particular defendant’s product more than doubled his chances of contracting a disease, but the evidence at trial also established that another source of the substance increased the chances by a factor of 10,000. In this circumstance, a trier of fact or a court reviewing the sufficiency of the evidence should be allowed to conclude that the defendant’s product was not a substantial factor in causing the disease.

 

Wisconsin Passes Asbestos Trust Reform

We posted before about the legislative effort in Wisconsin to level the asbestos playing field with regard to claims against asbestos trusts and remaining solvent defendants.  Earlier this month the state Senate passed a version of the bill that would require plaintiffs in asbestos personal injury actions to disclose whether they have filed a claim against any personal injury trust.

This week, the Wisconsin Assembly passed the bill (A.B.19), a version that will also create a setoff for defendants of the amount recovered from the trust.  The bill now goes to Gov. Scott Walker (R) for approval.  Published reports suggest the governor will sign the measure.

A.B. 19 imposes a series of new requirements in asbestos-related claims, including:

(a) the plaintiff shall provide to all parties a sworn statement identifying each personal injury claim he or she has filed or reasonably anticipates filing against an asbestos trust, including the amount claimed by the plaintiff, the date that the plaintiff filed the claim, the disposition of the claim and whether there has been a request to defer, delay, suspend, or toll the claim against the asbestos trust.
(b) For each personal injury claim he or she has filed against an asbestos trust, plaintiff shall provide a copy of the final executed proof of claim, all trust documents, including trust claims materials, trust governance documents, any documents reflecting the current status of the claim and, if the claim is settled, all documents relating to the settlement of the claim.
(c)  Trust claims materials and trust governance documents are admissible in evidence. No claims of privilege apply to trust claims materials or trust governance documents.
(d) Trust claim materials that are sufficient to entitle a claim to consideration for payment under the applicable trust governance documents may be sufficient to support a jury finding that the plaintiff may have been exposed to products for which the trust was established to provide compensation and that such exposure may be a substantial factor in causing the plaintiff's injury that is at issue in the action.
(e) If a verdict is entered in favor of the plaintiff in an action subject to this section and the defendant is found to be 51 percent or more causally negligent or responsible for the plaintiff's entire damages, the plaintiff may not collect any amount of damages until after the plaintiff assigns to the defendant all pending, current, and future rights or claims he or she has or may have for a personal injury claim against an asbestos trust.

 

UPDATE- The governor signed the bill. (reminder check our disclaimer page, we don't always update posts!)

 

Wisconsin Senate Passes Asbestos Trust Disclosure Bill

 The Wisconsin Senate recently passed a bill that would require plaintiffs in asbestos lawsuits to notify defendants of their various asbestos trust claims.  This comes in response to about the lack of transparency that allows plaintiffs to double dip from trusts and solvent defendants.

The bill passed on a mostly party line vote, and returns the issue to the state Assembly, which approved a similar measure last year.  Several states have  passed or considered similar legislation. Under the bill, plaintiffs would divulge all of their claims against asbestos trusts and any related documents, including those related to the settlement of the claim. The proposed legislation would also allow the trust documents to be admitted as evidence in asbestos personal injury claims. If a trust determined a plaintiff's claim against the trust was valid, a later jury could find that the plaintiff was exposed to the other asbestos product and that the other exposure may have been a substantial factor in causing the plaintiff's alleged asbestos-related injury in the suit.

Full text here.

 

State Supreme Court Reaffirms Death of Single Fiber Theory

The Pennsylvania Supreme Court recently reaffirmed several important principles in toxic tort exposure, specifically asbestos, cases. See Howard, et al. v. A.W. Chesterton Co., et al., Nos. 48 EAP 2012, 49 EAP 2012 and 50 EAP 2012 (Pa. Sept. 26,2013).

Plaintiff alleged personal injury from exposure to dust from defendant's asbestos-containing products. The common pleas court awarded summary judgment in favor of defendants/appellants, reasoning that plaintiff's deposition testimony failed to establish that he breathed asbestos-containing dust from the products manufactured or distributed by appellants, and the court also found expert affidavits submitted by plaintiffs represented insufficient proof of actual exposure.  On appeal, the Superior Court reversed on the basis that dust may have been invisible to the naked eye, and the expert affidavits were sufficient to establish exposure to dust which was a substantial causal factor in plaintiff's injury.

The Supreme Court reversed the intermediate appeals court, and in so doing reaffirmed several key principles of state law:

--The theory that each and every exposure, no matter how small, is substantially causative of disease may not be relied upon as a basis to establish substantial-factor causation for diseases that are dose-responsive. See Betz v. Pneumo Abex, LLC, 44 A.3d 27, 55-58 (Pa. 2012). 

-- Relatedly, in cases involving dose-responsive diseases, expert witnesses may not ignore or refuse to consider dose as a factor in their opinions. See id.

-- Bare proof of some de minimus exposure to a defendant’s product is insufficient to establish substantial-factor causation for dose-responsive diseases. See Gregg v. V-J Auto Parts, Inc., 943 A.2d 216, 225-26 (Pa. 2007).

-- Relative to the testimony of an expert witness addressing substantial-factor causation in a dose-responsive disease case, some reasoned, individualized assessment of a plaintiff’s or decedent’s exposure history is necessary. See Betz, 44 A.3d at 55-58.

-- Summary judgment is an available vehicle to address cases in which only bare de minimus exposure can be demonstrated and where the basis for the experts testimony concerning substantial-factor causation is the any-exposure theory. See Betz, 44 A.3d at 55-58; Gregg, 943 A.2d at 227.

In an interesting procedural twist, during arguments before the Supreme Court, plaintiff conceded that the Superior Court had erred in its ruling -- an apparent attempt to have the Supreme Court not reiterate the points that some lower courts in the state inexplicably continued to not apply.  Nevertheless, in light of the intensely protracted nature of asbestos litigation, the Court decided to provide at least some limited guidance.  Indeed, as explained in detail in the unanimous decision in Betz, the any-exposure opinion is simply unsupportable both as a matter law and science.

 

(Note that my colleague Mark Behrens was involved in the amicus briefing on behalf of the Coalition for Litigation Justice.)

Asbestos Conspiracy Verdict Overturned

An Illinois appellate court recently affirmed the trial court's decision overturning a significant jury verdict against various defendants accused of conspiring to conceal the dangers of asbestos. See Gillenwater v. Honeywell International Inc., et al., No. 4-12-0929 (Ill. App. Fourth District, 2013).

Plaintiff allegedly contracted mesothelioma as a result of exposure to asbestos in his job as a pipe-fitter. Gillenwater never worked for any of the companies in the appeal, but alleged they had engaged in a civil conspiracy with one another and the distributor to conceal the hazards of asbestos-containing products.  Readers understand that plaintiffs will often allege a conspiracy to draw in deep pocket defendants and to attempt to utilize one defendant's documents against another defendant.  The case went to trial and the jury returned a verdict for significant compensatory and punitive damages against the three defendants.

The court of appeals found that while there was some evidence that these defendants had some knowledge of the risks of asbestos, there was not sufficient evidence for a jury to conclude that they conspired together to conceal that knowledge.  Indeed, plaintiffs had no evidence that defendants Honeywell and Abex ever interacted with the product seller in any way. Honeywell and
Abex appeared to be nothing but bystanders, allegedly committing alleged wrongs that had nothing to do with plaintiff.  

Because a conspiracy requires a conspiratorial agreement between the active wrongdoer and the other conspirators, a logical first step when evaluating a claim of conspiracy is to clearly identify the active wrongdoer, the one whose tortious conduct was the proximate cause of harm to the plaintiff, as distinct from those who harmed the plaintiff more indirectly, merely by allegedly encouraging the active wrongdoer. The court noted that the gist of a conspiracy claim is not the agreement itself, but the tortious acts performed in furtherance of the agreement.  It is important to identify the active wrongdoer, because a conspiracy exists only if the others intentionally assisted or encouraged the tortious conduct of the active wrongdoer.  Here the alleged active wrongdoer was Owens-Corning. 

Plaintiff did present some evidence of interaction between defendant Owens Illinois and Owens-Corning because it manufactured the insulation that was ultimately distributed by Owens-Corning. The court reviewed the other alleged interactions on studies and warnings, shared directors, stock ownership, contracts, etc., in detail. But also noted that those companies terminated their relationship more than a decade before Gillenwater was first exposed to the products. The court cited numerous federal cases for the proposition that once a conspiracy has been terminated, that conspiracy claim cannot be extended by suggesting a second, subsidiary conspiracy to keep the original one under wraps. 

While a conspiracy can be shown by circumstantial evidence, and mere parallel conduct might serve as circumstantial evidence of an agreement under the civil conspiracy theory, it cannot, in itself, be considered clear and convincing evidence of such an agreement among manufacturers of the same or similar products.  Here, the defendants appeared to be engaging in parallel conduct by which they allegedly concealed the dangers of their own asbestos-containing products in order allegedly to maximize their own profits. 

This is not to say it is impossible for companies to have a conspiratorial agreement to continue doing that which is in their economic interest. But here a conspiratorial agreement was unnecessary to explain parallel conduct in continuing to do that which is in their economic interest. They each could be expected to pursue their economic interest on their own individual initiative. For that reason, in the absence of more evidence, it would be pure speculation to posit a conspiracy on the basis of consciously parallel conduct that is in each company’s economic interest; and tort liability cannot rest on speculation, said the court of appeals.

 

State Supreme Court Takes Controversial Asbestos Case

The California Supreme Court agreed last week to review an asbestos case involving an important failure to warn theory. See Webb v. Special Electric Co. Inc., No. S209927 (Cal., 2013).

Plaintiff Webb was diagnosed with mesothelioma, which he attributed to his exposure to asbestos products, including Transite pipe allegedly manufactured by Johns-Manville at its plant in Long Beach,
California, which allegedly contained asbestos supplied to it by Special Electric.  Transite pipe was four inches in diameter, and came in five-foot and sometimes ten-foot lengths. It was typically used for water-heater venting. Webb alleged he used no gloves or respiratory protection when handling the pipe. 

After trial, the lower court decided it would hear Special Electric's motions for nonsuit and directed verdict, both of which argued, inter alia, that Special Electric had no duty to warn Johns-Manville of the dangers of asbestos, either because Johns-Manville had been warned of those dangers, or because the dangers were obvious and known to Johns-Manville, a sophisticated user of asbestos. Special Electric argued also that it had no duty to take measures to warn allegedly unsophisticated downstream users of products containing its asbestos, such as Webb, because Special Electric could rely on Johns-Manville to provide those warnings. The trial court agreed, concluding that "telling Johns-Manville about asbestos is like telling the Pope about Catholicism." In so doing, the trial court relied on the well-settled rule that sophisticated users of dangerous products need not be warned about dangers of which they are already aware, derived from Restatement Second, Torts, section 388.

Plaintiff appealed, and the court of appeals reversed. Much of the discussion was on procedural issues (timing and notice, etc.) but our focus is on the alternative ruling on the merits.  The court of appeals agreed that Johns-Manville was a sophisticated user of asbestos, one which needed no warning about its dangers. But, nevertheless, reversed, finding that whether all the asbestos shipped to Johns-Manville had warnings, whether the warnings were adequate, and whether reasonable efforts to warn downstream
users could have been undertaken by Special Electric, were issues of fact. The jury found that Webb had
been exposed to asbestos sold or supplied by Special Electric; that the risks of its asbestos products were known or knowable to Special Electric; and that the risks of Special Electric‘s asbestos products presented a substantial danger to consumers, that ordinary consumers would not recognize. Special Electric‘s duty to warn foreseeable potential users such as Webb, said the court, arose as a matter of law, as seen from the jury‘s fully supported findings.  Because Special Electric‘s duty existed as a matter of law, the jury was entitled to—and did—find from the evidence that Special Electric breached that duty and that its breach was a substantial factor in causing Webb‘s harm, whether some other factors (such as superseding cause) terminated Special Electric‘s share of liability, and the appropriate apportionment of liability between the various actors.

The state Supreme Court will consider the issues now, and tell us what happened to the sophisticated user doctrine.  The concern is that the court of appeals appears to be saying that it can be a tort to fail to tell a customer something they already know, and that it can also be a tort to fail to impose on a direct customer a contractual duty to do something with their customer they already have a tort duty to do. On causation, the dissent offered a cogent analogy: if a defendant in an automobile collision breached the duty of care by driving a car with nonfunctioning headlights, then the plaintiff cannot prove causation merely by demonstrating that the defendant’s car caused the plaintiff‘s injuries when they collided. Rather, the plaintiff must show that the defendant’s driving with nonfunctioning headlights caused the plaintiff’s injuries (because, for example, the accident happened in the dark of night rather than in broad daylight). The case arguably can be limited to unique facts, procedural posture, and some strange jury instructions, but perhaps the high court will clarify that the California courts cannot ignore the sophisticated user doctrine and its impact on duty to warn. 

 

Third Circuit Affirms Asbestos Dismissals

Readers know that too often the necessary administrative procedures set in place in a mass tort are enforced on a one-way basis, costing defendants money and resources without requiring plaintiffs to comply with necessary discovery in a timely fashion.  The Third Circuit recently affirmed a lower court decision to exclude from an MDL workers allegedly exposed to asbestos at work when these plaintiffs failed to provide full asbestos exposure histories. See In Re: Asbestos Products Liability Litigation (NO. VI), numbers 12-2061-12-2072 (3d Cir. 2013).  

MDL 875 once included more than 150,000 plaintiffs and more than eight million claims. By the time Judge Robreno inherited the MDL in 2009, thousands of cases had been settled or otherwise resolved. Judge Robreno has been overseeing the progress and resolution of the remaining cases since then.  In the asbestos MDL No. 875, the court had issued Administrative Order 12, which required plaintiffs to submit medical diagnoses or expert opinions based on certain data, interpreted to include exposure history. The order was issued in 2007 and was intended to accelerate the handling of the significant numbers of cases in this MDL by screening out cases in which causation cannot be demonstrated, and to avoid unnecessary burdens on defendants by requiring plaintiffs to provide certain medical and exposure information at the outset of the case.

The district court dismissed several cases in 2012, holding that the plaintiffs' submissions regarding their alleged medical conditions did not meet Administrative Order 12.  Specifically, Judge Robreno determined that the Plaintiffs' submissions were fatally flawed in that they failed to include specific histories of Plaintiffs' exposure to asbestos. Plaintiffs' counsel disputed that interpretation of the order as requiring a complete occupational history of asbestos exposure, and offered simply a diagnosis of an asbestos-related disease. At no point did Plaintiffs offer supplemental AO 12 submissions with more complete exposure histories. 

The Third Circuit agreed that the language of AO 12 is broad, but saw no reason not to defer to the District Court's interpretation of AO 12 that requires plaintiffs' submissions to include asbestos exposure history. Based on the language in AO 12 that requires plaintiffs to submit medical diagnoses or opinions based on objective and subjective data, as well as based on statements from reputable medical organizations that emphasize the importance of exposure history, the District Court interpreted AO 12 submissions to include exposure history. And it was not an abuse of discretion – especially given the District Court's experience overseeing the MDL proceedings – to require a complete occupational and environmental exposure history. 

 

House Committee Approves Asbestos Bill

Quick note for our readers who follow asbestos mass tort issues:  the House Judiciary Committee decided in a 17–14 party-line vote this week to reject  various proposed amendments to the Furthering Asbestos Claim Transparency Act of 2013 (H.R. 982).  The FACT Act would require the various asbestos settlement trusts to make public disclosures detailing the claims to the trust and to provide certain information about claims on request (but not confidential medical records).  The amendments were proposed by Democrats opposing the bill.

The Full Committee Markup of H.R. 982 is here.  Hearing information regarding the 3/13 hearing on the bill is here

Passage of the Fact Act would allow defendants to properly assess a plaintiff’s complete exposure history. As it stands, plaintiffs often hide behind trust confidentiality to make solvent defendants believe that their products were far more responsible for the plaintiff’s disease than the true picture.  As asbestos liabilities force more and more companies to file for bankruptcy, legislators need to preserve assets for appropriate claimants; the secrecy and abuse associated with the trusts undermines this as well.

 

Daubert Decision to Watch in Ninth Circuit

Here's one to watch. The Ninth Circuit last week said it will rehear the case of a paper mill employee whose $9.4 million mesothelioma verdict was vacated by a panel of the appeals court. The court noted in a one-page order that it will rehear the case en banc, but did not provide any specifics. See Henry Barabin. et al. v. AstenJohnson Inc., No. 10-36142 (9th Cir.); Henry Barabin, et al. v. AstenJohnson Inc. and Scapa Dryer Fabrics Inc., No. 11-35020 (9th Cir.). 

We can certainly speculate, of course, and our guess is that the reason for the decision does not relate directly to the evidentiary issue the panel had when, in November, it overturned the award after finding that the trial court failed to adequately assess the reliability of the plaintiffs' expert testimony.

Readers may recall that plaintiff sued alleging that his 2006 diagnosis of mesothelioma was caused by occupational exposure to asbestos during the more than 30 years he worked at the Crown-Zellerbach paper mill.  The trial court originally excluded Kenneth Cohen, one of the plaintiffs’ expert witnesses, because of his “dubious credentials and his lack of expertise with regard to dryer felts and paper mills.”  But the court later reversed that ruling, after the plaintiff supplemented the record on the expert's credentials, including that he had testified in other cases (in Frye jurisdictions though). The jury found in favor of plaintiffs.

On appeal, the Ninth Circuit determined that the lower court had not properly considered all the Daubert factors, and instead had allowed the plaintiff to submit the expert’s "unfiltered testimony" to the jury.  “Once presented with the additional information in the Barabins’ response to the motion in limine, at a minimum the district court was required to assess the scientific reliability of the proffered expert testimony ...  In failing to do so, the district court neglected to perform its gatekeeping role.”

Our guess is that the court is thinking more about the fact that the panel remanded the case for a new trial in light of the court’s 2003 decision in Mukhtar v. California State University, 299 F.3d 1053 (9th Cir. 2002), amended by 319 F.3d 1073 (9th Cir. 2003).  One of the concurring opinions questioned the rule from that case that requires the court to vacate and remand for a new trial, as opposed to deciding on the need for a new trial after making a new Daubert determination.  From where we sit, the court had it right in 2003 and this time too. To remand for an evidentiary hearing post-jury verdict undermines Daubert's requirement that some reliability determination must be made by the trial court before the jury is permitted to hear the evidence. Otherwise, instead of fulfilling its mandatory role as a gatekeeper, the district court clouds its duty to ensure that only reliable evidence is presented with impunity. A post-verdict analysis does not protect the purity of the trial, but instead creates an undue risk of post-hoc rationalization. This is hardly the gatekeeping role the Supreme Court envisioned in Daubert and its progeny.  The rule in Mukhtar gives trial courts a real and important incentive to be proper, active gatekeepers. 

 

State Supreme Court Clarifies Causation Standard in Asbestos Case

The unique and overwhelming features of the grandfather of all mass torts, asbestos, has created bad law in many jurisdictions, procedurally and substantively.  One important example is the issue of causation, and the questions that arise from an injury possibly associated with multiple  exposures to multiple products over many years.  Last year, we posted about a Pennsylvania decision that rejected the plaintiff position that an expert can opine that any level of exposure to a toxic substance is a substantial contributing factor to a disease that is governed by a dose-response relationship.

Recently, the Virginia Supreme Court adopted a new “multiple sufficient causes” analysis as the standard for Virginia mesothelioma cases involving multiple asbestos exposures. See Ford Motor Co. v. Boomer, No. 120283 (Va. 1/10/13).

Plaintiff was diagnosed with mesothelioma, a malignant cancer of the pleura of the lungs.  He asserted that his job duties required that he observe vehicle inspections wherein mechanics used compressed air to blow out brake debris (dust) to allow for a visual inspection of the vehicle's  brakes. He testified that he observed vehicle inspections in approximately 70 garages a month, for five to six hours a day, ten days each month. He testified that his rotations included supervising inspections at a Ford dealership. He said he also specifically remembered Oldsmobile dealers on his rotation. Plaintiff could not identify the type of brake linings being inspected, but presented some circumstantial evidence as to the likely manufacturer of the brake linings being Bendix.

Plaintiff's experts opined that the exposure to dust from Bendix brakes and brakes in Ford cars were both substantial contributing factors in his mesothelioma. And they opined that the current medical evidence suggests that there is no safe level of chrysotile asbestos exposure above background levels in the ambient air. However, plaintiff also testified that he worked as a pipefitter at the Norfolk Naval Shipyard in the early 1940s. His own work and the work of those immediately around him involved packing sand into pipes so that the pipes could be bent to fit the ships. Defense experts opined that his profile was more consistent with a person who had exposure to amosite asbestos at a shipyard sixty years ago than a person exposed to chrysotile brake products.

The jury found in favor of the plaintiff; the trial court denied Bendix' and Ford's motions to strike the expert testimony and their motions to set aside the verdict or for a new trial. Bendix and Ford timely appealed, including on the issue that the court had instructed the jury to determine whether Ford's or Bendix' negligence was a "substantial contributing factor" to plaintiff's mesothelioma. Defendants challenged the use of the substantial contributing factor language as contrary to prevailing Virginia law as to causation.

The court reviewed the traditional Virginia law of causation, which in most instances requires proof that but for the defendant's actions the plaintiff would not have been injured.The 'but for' test is a useful rule of exclusion in all but one situation, said the court: where two causes concur to bring about an event and either alone would have been sufficient to bring about an identical result.  Thus, state law has long provided a means of holding a defendant liable if his or her negligence is one of multiple concurrent causes which proximately caused an injury, when any of the multiple causes would have each have been a sufficient cause.

Causation in a mesothelioma case, however, observed the court, presents a challenge beyond even that standard concurring negligence instruction. Mesothelioma is virtually a signature disease: it was uncontroverted at trial that in most situations the cause of mesothelioma is exposure to asbestos at some point during an individual's lifetime. The long latency period of the disease, however, makes it exceedingly difficult to pinpoint when the harmful asbestos exposure occurred and, in the presence of multiple exposures, equally difficult to distinguish the causative exposures. Further complicating the issue, said the court, although numerous individuals were exposed to varying levels of asbestos during its widespread industrial use before safety measures became standard, not all persons so exposed developed mesothelioma.  It is not currently known why some are more susceptible than others to developing mesothelioma, or why even comparatively lower levels of exposure may cause mesothelioma in some individuals while others exposed to higher dosages never develop the disease. Thus, in the context of a lifetime of various potential asbestos exposures, designating particular exposures as causative presents courts with a unique  challenge.

Certainly, said the court, if the traditional but-for definition of proximate cause was invoked, the injured party would virtually never be able to recover for damages arising from mesothelioma in the context of multiple exposures, because injured parties would face the difficult if not impossible task of proving that any one single source of exposure, in light of other exposures, was the sole but-for cause of the disease. The lower court thus used a "substantial factor" test.  In the last several decades, with the rise of asbestos-based lawsuits, the "substantial contributing factor" instruction has become prominent in some other jurisdictions. See, e.g., Lohrmann v. Pittsburgh Corning Corp., 782 F.2d 1156, 1162-63 (4th Cir. 1986) (upholding Maryland's substantial contributing factor standard in an asbestosis case); Rutherford v. Owens-Illinois, Inc., 941 P.2d 1203, 1219 (Cal. 1997).

Here, the court rejected the “substantial contributing factor” analysis used by these several other jurisdictions.  The Court did not believe that substantial contributing factor has a single, common-sense meaning, and concluded that a reasonable juror could be confused as to the quantum of evidence required to prove causation in the face of both a substantial contributing factor and a proximate cause instruction. In sum, some jurors might construe the term to lower the threshold of proof required for causation while others might interpret it to mean the opposite. The court also agreed with the explicit rejection of substantial contributing factor language in the recent Restatement (Third) of Torts: Liability for Physical and Emotional Harm (2010).  The substantial-factor rubric, says the commentary, tends to obscure, rather than to assist, explanation and clarification of the basis of causation decisions. The latest Restatement provides a rule for finding each of two acts that are elements of sufficient competing causal sets to be factual causes without employing the substantial-factor language of the prior Torts Restatements. There is no question of degree in the new version.  It holds that if multiple acts occur, each of which alone would have been a factual cause of the physical harm at the same time in the absence of the other act(s), each can be regarded as a factual cause of the harm.

The court found this model, as explicated in the comments, quite consistent with its prior rulings regarding concurring causation. A defendant whose tortious act was fully capable of causing the plaintiff's harm should not escape liability merely because of the fortuity of another sufficient cause. So the but-for standard is a helpful method for identifying causes, but it is not the exclusive means for determining a factual cause. Multiple sufficient causes may also be factual causes.  The acts themselves do not have to be concurrent, so long as they are operating and sufficient to cause the harm contemporaneously. As to mesothelioma, said the court, the "harm" occurs not at the time of exposure but at the time when competent medical evidence indicates that the cancer first exists and  thus causes injury. 

 The court said that the separate comment under Restatement § 27, entitled "Toxic substances and disease," should not be applied here.  That approach allows for a finding of causation when multiple exposures combine to reach the threshold necessary to cause a disease, allowing parties who were responsible for some portion of that threshold to be held liable. While it may be the case that this dose-related approach to causation is indeed appropriate for some cancers or diseases, the court did not find it to be necessarily appropriate for mesothelioma from asbestos.

Based on this rule, plaintiff must show that it is more likely than not that his alleged exposure to dust from defendant's brakes occurred prior to the development of cancer and was sufficient to cause his mesothelioma. Given that this approach differs from that taken in the circuit court, the court did not find it appropriate to rule on the sufficiency of the evidence at trial at this time, and instead remanded. On remand, the experts must opine as to what level of exposure is sufficient to cause mesothelioma, and whether the levels of exposure at issue in this case were sufficient.

State Supreme Court Issues Forum Non Conveniens Decision

A tip of the hat to faithful reader Brendan Kenny at Blackwell Burke for noting the recent decision by the Illinois Supreme Court in Fennell v. Illinois Central Railroad.

The issue is forum non conveniens. Brendan notes that the Illinois Supreme Court ruled that the trial court abused its discretion when it denied defendant Illinois Central's forum non conveniens motion. The state Supreme Court reversed the appellate court judgment affirming the trial court's denial, and remanded the case to the trial court with instructions to dismiss. Per Brendan, this 5-1 decision will be helpful to defendants as it emphasizes that Illinois trial courts must grant a defendant's forum non conveniens motion if the plaintiff has no significant connection to the forum and there is an alternative forum that is more convenient. This decision likely strengthens defendants' challenges to asbestos plaintiffs forum shopping in plaintiff-friendly forums like Madison County. This will allow defendants to move asbestos cases to more appropriate forums. 

Brendan notes that Fennell involved plaintiff's 37-year exposure to asbestos-containing products while working for Illinois Central. Fennell lived and sometimes worked in Mississippi, but he also worked across the country for the railroad, and he alleged that he was exposed to asbestos-containing products wherever he worked. In 2002, Fennell and a group of 80 other plaintiffs sued Illinois Central in Mississippi state court. In 2006, Illinois Central filed a motion to dismiss, and the Mississippi court dismissed the case without prejudice.

In 2009, rather than re-file the case in Mississippi, Fennell filed an action against Illinois Central in Saint Clair County, Illinois. He alleged that he was exposed to asbestos and other toxic substances while working for Illinois Central, but he did not allege an injury in Saint Clair County. In May 2010, Illinois Central filed a forum non conveniens motion. Brendan observes that the trial court denied the motion because: (1) Illinois Central's lawyers had significant evidence in Saint Clair County, (2) two of Fennell's important witnesses would testify in Illinois but not in Mississippi, (3) Saint Clair County is closer for Fennell's Chicago-based expert witness than Mississippi, (4) Saint Clair citizens have an interest in "traveling asbestos and other harmful substances"; and (5) Saint Clair County's dockets are uncongested.

Illinois Central appealed, and a divided appellate-court panel affirmed. Illinois Central appealed to the Illinois Supreme Court, and several amici filed briefs.

A trial court's denial of a forum non conveniens motion is reviewed for abuse of discretion. Under the forum non conveniens doctrine, a trial court may decline jurisdiction if it appears that another forum can better serve the parties' convenience and the ends of justice. When ruling on the motion, trial court must consider what forum the totality of public and private-interest factors favor.

Brendan notes that private-interest factors include the parties convenience, access to evidence, ability to compel witnesses to appear for trial, cost of presenting willing witnesses at trial, possibility of viewing the premises at issue, and any other factors that make a trial "easy, expeditious, and inexpensive." Trial courts should also consider that courts have never favored forum shopping, and that a plaintiff's interest in selecting a forum is less if the plaintiff is foreign to the forum and the action arose outside the forum. Public-interest factors include the congestion of the forum's courts, the unfairness of imposing jury duty on residents in a community unconnected to the litigation, and the interests of local communities in deciding local issues.

The Supreme Court held that the trial court abused its discretion because it failed to properly apply the public and private-interest factors. Brendan points out that Fennell was from Mississippi and his cause of action arose outside Illinois. The Supreme Court noted that trial court ignored that Fennell initially filed in Mississippi and re-filed in Illinois. It emphasized that Fennell lives less than 25 miles from the Mississippi courthouse, but 530 miles away from the Saint Clair courthouse, and that almost no one connected with Fennell's case lives in Illinois. Nothing suggested that having the case in Mississippi would unduly hamper the parties' discovery. And it held that Fennell's Chicago-based expert's convenience was entitled to little weight because he is compensated for his travel, and factoring the convenience of plaintiffs' expert would make forum shopping even easier.

The Illinois Supreme Court also rejected the trial court's conclusion that two of Fennell's important witnesses would not testify in court in Mississippi; these witnesses were Illinois Central employeees and this makes it unlikely that Fennell would have difficulty compelling them to testify in Mississippi. In contrast, the Mississippi-based witnesses could not be compelled to testify in Saint Clair County, and bringing the willing witnesses there would cost more.

The Illinois Supreme Court was not persuaded, Brendan notes, that the office of Illinois Central's counsel in Saint Clair County was significant. Assuming that the law firm had many Illinois Central documents relevant to the case there, the Illinois Supreme Court noted that modern technology allows litigants to copy and transport the documents long distance easily and cheaply. 

The Supreme Court found that Saint Clair County had a strong interest in avoiding subjecting its citizens to jury duty in a case unrelated to their community. And even assuming that Saint Clair County citizens had some interest in "traveling asbestos and other harmful substances," they have a greater interest in not being burdened with litigation they have no connection to. 

 

Ninth Circuit Vacates Asbestos Verdict on Daubert Basis

The Ninth Circuit earlier this month vacated a $9 million award for a plaintiff who allegedly contracted mesothelioma working for decades at a paper mill, because the trial court failed to assess the reliability of expert testimony for the plaintiffs under Daubert v. Merrell Dow Pharm.,
Inc
., 509 U.S. 579 (1993). See Henry Barabin et al. v. AstenJohnson Inc., et al., Nos. 10-36142 and 11-35020 (9th Cir.). 

Plaintiff's employer used dryer felts containing asbestos allegedly made or sold by defendants. During his employment, he allegedly worked in various jobs that exposed him to the dryer felts that defendants had provided. He also took pieces of dryer felt home to use in his garden.  In November, 2006, Plaintiff was diagnosed with pleural malignant epithelial mesothelioma.  It was undisputed that exposure to respirable asbestos can cause mesothelioma (general causation).

Defendants filed a motion in limine to exclude plaintiff's expert witnesses on specific causation. The district court excluded one (Dr. Cohen) as an expert because of his “dubious credentials and his lack of expertise with regard to dryer felts and paper mills. . . ” Additionally, the district court limited a second (Dr. Millette), requiring disclosure to the jury that Dr. Millette’s tests were “performed under laboratory conditions which are not the same as conditions at [plaintiff's workplace].”  However, during a pre-trial conference, the district court reversed its decision to exclude Dr. Cohen’s testimony. The district court explained that plaintiffs had clarified Dr. Cohen’s credentials, including that he had testified in other cases. The district court did not hold a Daubert hearing.

After the jury verdict and post-trial motions, defendants appealed.  The court of appeals noted that in its role as gatekeeper, the district court determines the relevance and reliability of expert testimony and its subsequent admission or exclusion. See Ellis v. Costco Wholesale Corp., 657 F.3d 970, 982 (9th Cir. 2011). Admission or exclusion under Daubert rests on the scientific reliability and relevance of the expert testimony.  The expert’s opinion must be deduced from a “scientific method” to be admissible. The test under Daubert is not the correctness of the expert’s conclusions but the soundness of his methodology. Compliance with Rule 702 is gauged by the district court’s assessment of the reliability of the proffered expert testimony. Specifically, the district court is charged with determining whether the proffered expert testimony is trustworthy. In a case involving scientific evidence, evidentiary reliability will be based upon scientific validity. Scientific validity is, in turn, assessed in large part by the degree to which the theories propounded by the expert have been subjected to and survived scrutiny in the relevant scientific community.  The "decision to admit or exclude expert testimony is often the difference between winning and losing a case."

Since the decision to permit the testimony was based on reconsideration, the record was limited. Once presented with the additional information in the response to the motion in limine, at a minimum the district court was required to assess the scientific reliability of the proffered expert testimony.  Unfortunately, said the court of appeals, because no Daubert hearing was conducted as requested, the district court failed to assess the scientific methodologies, reasoning, or principles Dr. Cohen applied. None of the Daubert factors was considered. "Instead, the court allowed the parties to submit the experts’ unfiltered testimony to the jury."  In failing to do so, the district court neglected to perform its gatekeeping role.  Rather than making the required determinations, the district court left it to the jury to determine the relevance and reliability of the proffered expert testimony in the first instance, said the panel. The 9th Circuit panel seemed influenced in part by the fact that, in its order, the district court wrote: In the interest of allowing each party to try its case to the jury, the Court deems admissible expert testimony that every exposure can cause an asbestos-related disease. (emphasis added).

"Let the parties try their cases; let the jury sort it out" is not what Daubert allows or requires.  The district court committed reversible error when it failed to assess the proferred expert testimony for relevance and reliability, concluded the court. Prior decisions dictated that a new trial be provided in this circumstance.

Appeals Court Vacates Asbestos Plaintiff Jury Verdict

The Florida court of appeals recently reversed a $6.6 million judgment for the plaintiff in an asbestos case raising interesting issues of the law applicable to design and warning defects. See Union Carbide Corp. v. Aubin,  No. 3D10-1982 (3d DCA 6/20/12).

Plaintiff Aubin worked construction and alleged he routinely handled and was otherwise exposed to joint compounds and ceiling textures that contained asbestos. He contracted mesothelioma and sued.  At trial, plaintiff presented studies purportedly linking defendant's product to a higher degree of danger with respect to the development of asbestosis than other types of asbestos, but he failed to introduce any evidence suggesting it was more dangerous than other asbestos fibers with respect to the contraction of cancer or peritoneal mesothelioma. Also at trial, the parties offered contrasting evidence as to whether Union Carbide adequately informed intermediary manufacturers about the dangers of asbestos. Defense representatives testified that along with an OSHA-mandated warning label, Union Carbide regularly updated its clients regarding the dangers of asbestos as such dangers came to light. Conversely, plaintiff claimed that because there were no warnings on the end product, he was unaware of the dangers associated with the liberation of asbestos fibers into the air, and, therefore, allegedly did not wear any respiratory masks or protective gear while working around the asbestos.

Relying on the component parts doctrine recognized by the Restatement (Third) of Torts: Products Liability § 5 (1997), adopted by the 3d DCA in Kohler Co. v. Marcotte, 907 So. 2d 596, 598-99 (Fla. 3d DCA 2005), defendant moved for a directed verdict on plaintiff's strict liability and negligence claims. That motion was denied. At the charge conference, Union Carbide also requested jury instructions regarding the Third Restatement’s component parts doctrine, The trial court denied Union Carbide’s requests, choosing instead to deliver the special instructions that were requested by plaintiff. The key instruction read: “An asbestos manufacturer, such as Union Carbide Corporation, has a duty to warn end users of an unreasonable danger in the contemplated use of its products.”  The requested context was not provided.

The court of appeals concluded that the trial court erred, first, in determining that Aubin’s claims were governed by the Second Restatement rather than the Third Restatement and, as a result, erred in denying Union Carbide’s motion for a directed verdict with respect to Aubin’s design defect claim. Second, the trial court erred in instructing the jury that Union Carbide had a duty to warn end-users without also instructing the jury that a defendant could have discharged this duty by adequately warning the intermediary manufacturers, and reasonably relying on them to warn end-users. Accordingly, the court remanded for a new trial as to the warning defect claim.

Specifically, the trial court erred as a matter of law in determining that Aubin’s claims were governed by Sections 388 and 402 of the Second Restatement.  In Kohler, the court had adopted the component parts doctrine articulated in Section 5 of the Third Restatement as the governing law for products liability claims arising out of a defendant’s sale of a component part to a manufacturer who then incorporates the component into its own products. Kohler, 907 So. 2d at 598-99. This Appeals Court’s adoption of the Third Restatement was later reaffirmed and extended in Agrofollajes, S.A. v. E.I. Du Pont De Nemours & Co., 48 So. 3d 976, 997 (Fla. 3d DCA 2010), which rejected the Second Restatement’s “consumer expectations” test as an independent basis for finding a design defect, determining instead that, after Kohler, the appropriate standard is the “risk-utility/risk-benefit” test articulated in Section 2 of the Third Restatement.

Regarding the warnings claim instructions, reversible error exists where the trial court delivers an instruction that reasonably might have misled the jury.   Plaintiff Aubin had requested, and the trial court granted, the special instruction: “An asbestos manufacturer, such as Union Carbide Corporation, has a duty to warn end-users of an unreasonable danger in the contemplated use of its products.” While this requested special instruction was "technically accurate," it was, standing alone, misleading because Florida law provides that this duty may be discharged by reasonable reliance on an intermediary. Recognizing that Aubin’s requested instruction was misleading, Union Carbide requested that Aubin’s special instruction be supplemented with an explanation of how the duty to warn could have been discharged by Union Carbide. The trial court rejected Union Carbide’s request, and delivered Aubin’s instruction without further explanation. This was also error.

The court of appeals explained that under both the Third Restatement and the Second Restatement, the determination as to whether a manufacturer like Union Carbide may rely on intermediaries to warn end-users is to be analyzed by the trier of fact, and the standard to be  employed is one of “reasonableness.” The Third Restatement provides several factors to guide the analysis, and these factors are substantially the same as those set forth in the Section 388 of the Second Restatement under comment n.  The trial court, however, did not instruct the jury on any of these factors. 

Because the trial court’s instruction communicated to the jury that Union Carbide had a duty to warn end-users, but did not inform the jury that Union Carbide could have discharged its duty by adequately warning the intermediary manufacturers and reasonably relying on them to warn end-users, the court of appeals concluded that the instruction given was misleading and entitled defendant to a new trial.

State Supreme Court Issues Significant Asbestos Ruling

The Pennsylvania Supreme Court last week issued a potentially highly significant decision in the long-standing asbestos mass tort. See Betz v. Pneumo Abex LLC et al., No. J-87-2011 (Pa. May 23, 2012).

The issue is causation.  Readers know that a tort plaintiff has to establish cause in fact and proximate cause.  Cause in fact can mean "but for" the defendant's conduct, the plaintiff would not have been injured, or, in some cases, that the conduct was a "substantial factor" in causing the harm.  In toxic tort cases, cause in fact includes general causation (the product can cause this type of disease) and specific causation (the product did cause this plaintiff's disease). Often, epidemiological proof is used to establish causation in a toxic tort context, but there are strengths and limitations to that type of evidence, which can show an association between the product and the disease, and which typically demonstrates that there is some specific relationship between the amount of exposure to the product and the amount of disease seen in the exposed population (a dose-response relationship).  What may be unknown from the epidemiology (and other relevant scientific evidence) is whether there is a threshold of exposure below which there is no risk of disease, or whether any level of exposure carries a measurable increased risk of disease.  Plaintiffs' experts often assume there is no safe level of exposure, and regulatory agencies may assume the same as a matter of public health policy; these latter assumptions do not establish legal causation given their cautionary, prophylactic nature. But what proof a plaintiff has that an extremely low level of exposure to a given defendant's product can or did cause his disease is a crucial issue in many toxic tort contexts.

In asbestos, the grandfather of all mass torts, plaintiffs' experts often seek to testify that "one fiber can kill," meaning there is no safe level of exposure to asbestos, and from that to conclude that that any exposure to any amount of asbestos from any defendant was a substantial factor contributing to the asbestos disease the plaintiff has.  They say this even as they admit, as the epidemiology shows, that at all the measurable levels of exposure (no one can find a plaintiff exposed to just one fiber) asbestos-related disease demonstrates a clear dose-response relationship.

Back in 2005, plaintiff Simikian commenced a product liability action against several defendants, asserting causes of action grounded on multiple theories including strict liability. Mr. Simikian
alleged that, throughout a forty-four year career as an automotive mechanic, his exposure to asbestos-containing friction products, such as brake linings, caused his mesothelioma. Plaintiff indicated he would rely on expert opinion that each and every exposure to asbestos -- no
matter how small -- contributed substantially to the development of his asbestos-related
diseases: the the “any-exposure,” “any-breath,” or “any fiber” theory of legal (or substantial-factor) causation. See generally Summers v. Certainteed Corp., 606 Pa. 294, 316, 997 A.2d 1152, 1164-65 (2010) (discussing the requirement for a plaintiff to prove that a defendant’s product was a substantial factor in causing injury). Seeking to preclude such opinion testimony, defendants filed a motion under the Frye test (PA is a general acceptance jurisdiction), arguing that it barred this "novel" scientific evidence from the courtroom until it has achieved general acceptance in the relevant scientific community.

Plaintiffs relied on a Dr. Maddox, who provided for his opinion as to specific and proximate
causation that asbestos-related mesothelioma, like other diseases induced by toxic exposures, is a dose-response disease; that each inhalation of asbestos-containing dust from the use of
products has been shown to contribute to cause asbestos-related diseases, including  mesothelioma. Each of the exposures to asbestos allegedly contributes to the total dose that causes mesothelioma and, in so doing, shortens the period necessary for the mesothelioma to develop. Plaintiff further argued that each exposure to asbestos is therefore a substantial contributing factor in the development of the disease that actually occurs; a court need not look at individual exposures or the identity of the product or the manufacturer. "As a matter of law, you just say, hey, you breathed asbestos from a product, oh, you are going to the jury."

The trial court requested expert reports, and then held an evidentiary hearing. The Common Pleas court centered its focus on the use of extrapolation, from high doses down to a single finer, which it found to be a linchpin of Dr. Maddox’s methodology and opinion supporting a finding of proximate cause. The court expressed concern with an “analytical gap” between the scientific proofs and the expert's conclusion. At the hearing, the expert admitted he did not consider epidemiology appropriate to consult regarding low-dose exposures, offering an "analogy" that has been used in the example of a glass of water. One drops marbles into the glass of water until the water finally overflows from the glass; is it the first marble or the last marble that causes the glass
to overflow? Well, both, or all of them, said the plaintiff expert.

The expert testified, however, that individual exposures differ in the potency of the fiber to
which an individual is exposed, to the concentration or intensity of the fibers to which one is exposed, and to the duration of the exposure to that particular material. Dr. Maddox agreed that scientists presently do not know the mechanism by which asbestos causes mesothelioma. Additionally, he recognized that his opinions were not based on any sort of direct attribution, but rather, were grounded entirely upon an assessment of increased risk.

The trial court sustained the Frye challenge and precluded the plaintiffs from adducing the any-exposure opinion. Overall, Judge Colville could find no credible explanation for how it was that Dr.
Maddox was able to determine if it was exposure to a particular defendant’s friction product that
caused a plaintiff’s mesothelioma, and not some other exposure to asbestos material. Even if one accepts that a single fiber may possibly increase the risk of developing disease, it did not accept that an unquantified (and potentially infinitesimal) increase in risk could serve as proof that a defendant’s product was a substantial cause of a plaintiff’s or decedent’s disease. Generally accepted scientific methodology may well establish that certain “high dose” asbestos exposure causes, or contributes to, a specific hypothetical plaintiff’s disease, but the plaintiffs had not proffered any generally accepted methodology to support the contention that a single exposure or an otherwise vanishingly small exposure has, in fact, in any case, ever caused or contributed to any specific individual’s disease, or even less so, that in this case such a small exposure did, in fact, contribute to this specific plaintiff’s disease.

Plaintiff appealed, and the Superior Court reversed, basically disagreeing with every aspect of the trial court's analysis. It relied on Ferebee v. Chevron Chemical Co., 736 F.2d 1529 (D.C. Cir. 1984), essentially for the proposition that, so long as an expert is willing to testify to an extrapolation, courts should permit its admission. (The notion that courts have no screening function is at odds with the last couple decades of federal court evidence law, just as it was at odds with most federal circuits at the time the DC CIrcuit opinion was written, and with states that have adopted Daubert and also those that still adhere to Frye.) Defendants then appealed.

Appellants (and their amici) offered extensive critiques of Dr. Maddox’s methodology from both scientific and logical perspectives, with the bottom line that the any-exposure opinion remains a hypothesis or assumption, and stressing Dr. Maddox’s inability to identify any peer-reviewed scientific support undergirding the opinion. While plaintiffs offered much argument on the effects of high doses of asbestos, they did not squarely address appellants’ arguments concerning differences in potency among asbestos fibers, or the potential that exposure to asbestos from a defendant’s product might be minimal in comparison to others.

The state Supreme Court noted that this case was selected among test cases for the any-exposure opinion as a means, in and of itself, to establish substantial-factor causation. The plaintiff's efforts to invoke case reports, animal studies, and regulatory standards to support the theory were ineffectual in terms of substantial-factor causation, since the most these can do is suggest that there is underlying risk from the defendants’ products, a proposition with which the trial court did not disagree.  What was more of concern was the assessment of substantiality.
In this regard, Dr. Maddox’s any-exposure opinion was in irreconcilable conflict with itself. Simply put, one cannot simultaneously maintain that a single fiber among millions is substantially causative, while also conceding that a disease is dose-responsive. The any-exposure opinion, as
applied to substantial-factor causation, did not consider the three factors which Dr. Maddox himself explained needed to be considered in trying to estimate the relative effects of different exposures: potency, intensity, duration.

The court took on directly the analogy offered by Dr. Maddox in support of his position: the marbles-in-a-glass illustration changes materially upon the recognition that to be a fair comparison one must include the factors that the marbles are all non-uniform in size and shape, and microscopic so that millions are needed to fill the glass. From this frame of reference, it is very difficult to say that a single one of the smallest of microscopic marbles is a substantial factor in causing a glass of water to overflow.  

Superior Court reversed; trial court affirmed.

State Supreme Court Revises "Two-Injury" Rule

The traditional single claim rule requires a plaintiff to bring at one time a suit for all the injuries arising from the same accident or incident, or risk being barred.  In the toxic tort context, the issue is complicated by the fact that an exposure may put a plaintiff at risk for different diseases that have different latency periods, meaning different time periods before the injuries will manifest themselves.  Courts have to consider the impact of the statute of limitations, res judicata, and the pros and cons of encouraging premature filings relating to the mere risk of future disease or of allowing a plaintiff to, in a sense, split a cause of action into separate claims arising from the same product, same exposure, and same alleged conduct of the defendant.

Last week, the Pennsylvania Supreme Court modified its rules on these issues, holding that plaintiffs seeking damages for certain asbestos-related health problems can file separate lawsuits for distinct cancers they may develop. See Daley v. A.W. Chesterton Inc., et al., No. J-98-2010 (Pa. 2012).

In 1989, plaintiff/appellee Herbert L. Daley was diagnosed with pulmonary asbestosis and squamous-cell carcinoma of the right lung.  He sued several defendants, and the case eventually settled.  A decade later, Daley was diagnosed with malignant pleural mesothelioma.  He sued a dozen asbestos defendants. Plaintiffs conceded that the mesothelioma was caused by the same asbestos exposure that resulted in his lung cancer and pulmonary asbestosis for which he
sought and obtained compensation in the 1990's.  Defendants (who had not been in the first case, presumably because of the terms of the releases) filed motions for summary judgment, contending that, because Daley previously filed an action for a malignant asbestos-related condition in 1990, Pennsylvania’s “two-disease” rule did not allow him to file an action for a second malignant asbestos-related disease – here, mesothelioma.

Pennsylvania had been one of the states to adopt a two-disease rule, which under certain circumstances created an exception to Pennsylvania’s single cause of action rule, and allowed certain second actions without running afoul of the two-year statute of limitations or the notion of res judicata.  Specifically, the courts had adopted, for purposes of asbestos litigation, a two-disease rule, allowing plaintiffs to bring one action based on a nonmalignant asbestos disease
and a subsequent action for any separately diagnosed malignant disease.  The court determined that malignant and nonmalignant asbestos-related injuries constituted separate claims.  Here, though, the issue was a little different: was plaintiff limited to one cause of action for a malignant asbestos-related disease and one cause of action for a nonmalignant asbestos-related disease? 

Defendants argued, with compelling logic, that the rule clearly arose in the context of malignant vs. non-malignant disease.  (Readers of MassTortDefense know the great administrative burdens, ethical questions, and significant policy issues, that the non-malignant asbestos claims have created.) Moreover, allowing plaintiffs to bring more than one lawsuit for asbestos-related diseases of the same category would cause the judicial system to be burdened with more piece-meal litigation.  Residents of other states would seek to benefit by this expansion of the two-disease rule by filing suits in Pennsylvania. Allowing a plaintiff to bring separate lawsuits for separate malignant diseases, such as lung cancer and mesothelioma, would also make the determination of an appropriate award of damages more difficult due to an inability to segregate the damages for each of the separate diseases.

However, the state supreme court said that defendants were reading the asbestos precedents too narrowly; the decision to allow a plaintiff to file one cause action for a nonmalignant asbestos-related disease, and a subsequent cause of action for a malignant asbestos-related disease, arose from a recognition that requiring a plaintiff to seek recovery for all present and future asbestos-related diseases, including malignant and nonmalignant diseases, upon first experiencing symptoms of any asbestos-related disease, was likely to result in anticipatory lawsuits, protracted litigation, evidentiary hurdles, speculative damages, and excessive or inadequate compensation.  While the separate disease rule initially developed from, and has since been applied in, cases involving a cause of action for a nonmalignant disease, followed by a cause of action for a malignant disease, the concerns that the rule was designed to address
were, said the court, not limited to situations where a plaintiff suffers one nonmalignant asbestos-related disease and one malignant asbestos-related disease. The court emphasized that with regard to mesothelioma, the estimated latency period for is 30 to 50 years, whereas the estimated latency period for asbestosis and most lung cancers is 10 to 20 years. Thus, it was unlikely a plaintiff would be diagnosed with mesothelioma until long after he had been  diagnosed with, and the statute of limitations had expired for, lung cancer. Requiring a plaintiff to seek damages for a potential future diagnosis of mesothelioma at the time he is diagnosed with lung cancer not only imposes nearly insurmountable evidentiary hurdles on the plaintiff, said the majority, but also may subject a defendant to payment of damages for a serious disease which a vast majority of plaintiffs will not actually develop.

In view of these circumstances, the court concluded that a plaintiff who is diagnosed with a malignant disease, and later diagnosed with a separate and distinct malignant disease caused by the same asbestos exposure, may benefit from the separate disease rule. The court did note that relevant factors for "separate and distinct" may include evidence that the diseases: developed by different mechanisms; originated in different tissue or organs; affected different tissue or organs; manifested themselves at different times and by different symptoms; progressed at different rates; and carried different outcomes.

The decision was 6-1;  time will tell whether the defendants were correct in predicting the rule change will lead to more asbestos filings, or the majority was right in predicting fewer.

Busy Mass Tort Court Revamps Procedures

Our readers recognize that Philadelphia (home base for MassTortDefense) is a hot-bed of mass tort activity, administering those cases through a Complex Litigation Center.  Now comes important news that the Honorable John W. Herron, Administrative Judge of the Trial Division of the Philadelphia Court of Common Pleas, recently issued an order that will alter and impact the handling of mass tort cases in this busy jurisdiction.

General Court Regulation No. 2012-01 represents the first general overhaul of the Complex Litigation Center’s practices in many years. The order  will revise and streamline the conduct of mass tort litigation in Philadelphia in a number of ways.   More on that in a minute.  What is also significant is the reason for the changes.  The order notes the pronounced upward trend in mass tort filings in this court, and the fact that the court’s disposition rate has not kept pace with filings; thus, a significant backlog has developed.  The order notes the impact of past policy which invited the filing of cases from other jurisdictions.  A "dramatic increase in these filings" occurred after the court’s leadership invited claims from other jurisdictions. In 2009, when published comments were offered encouraging the filing of claims in Philadelphia, out-of-state filings rose to 41%, and in 2011 reached 47%.

So, in response, Judge Herron’s order:

  • ends reverse bifurcation in all mass tort cases,
  • significantly limits the consolidation of non-asbestos cases,  unless agreed by all parties,
  • requires the deferral of all punitive damage claims,
  • requires, except upon showing of exigent circumstances, all discovery to take place in Philadelphia,
  • re-emphasizes mediation of cases,
  • limits expediting of cases based on exigent medical or financial reasons until the backlog of pending cases has been resolved, unless otherwise agreed by a majority of the defendants.

The Honorable Arnold New will be reassigned as a Coordinating Judge of the Complex Litigation Center. Judge New is an experienced and respected member of the Philadelphia Court of Common Pleas, having served on the bench for more than 20 years. He currently administers another of the Court’s innovative programs, the Commerce Program. To ensure a smooth transition, Regulation No. 2012-01 provides that Judge New will act as Co-Coordinating Judge of the Complex Litigation Center, sitting in tandem with the Honorable Sandra Mazer Moss. Judge Moss will assume senior status as of December 31, 2012, at which time Judge New will thereupon serve as the sole Coordinating Judge of the Complex Litigation Center and its Mass Tort Program.

The order advises that the court will entertain additional suggestions from the bar, and will open a comment period in November, 2012, to allow interested parties the opportunity to address the new procedures and to suggest any further changes that may be needed. 

There is little doubt that this court's Complex Litigation Center faces a daunting task in handling a large number of cases involving complex and sophisticated claims and defenses, while seeking to resolve them both fairly and efficiently.  Time will tell,  but the new procedures ordered by Judge Herron should improve the functioning of the Complex Litigation Center, and the ongoing process of review and comment invited by the order will allow interested parties the opportunity to see that the Center keeps moving in the right direction.
 

 

Raw Material Suppliers Not Liable for Worker Injuries

A California appeals court ruled last week that several raw material suppliers could not be held liable for injuries allegedly sustained by a worker as a result of using their raw materials. See John Maxton v. Western States Metals, et al., No. B227000 (Cal. Ct. App., 2d Dist., 2/1/12).

Plaintiff alleged he sustained personal injuries as a result of working with metal products manufactured by defendants and supplied to Maxton‘s employer. The metal products were essentially raw materials that could be used in innumerable ways. The products at issue consisted of steel and aluminum ingots, sheets, rolls, tubes and the like. Plaintiff alleged he
worked with and around each of these metal products in cutting, grinding, sandblasting, welding, brazing, and other activities. This allegedly resulted in the generation and release of toxicologically significant amounts of toxic airborne fumes and dusts. As a direct result of this exposure, Maxton claimed he developed lung disease. 

Generally, suppliers of raw materials to manufacturers cannot be liable for negligence, or under a strict products liability theory, to the manufacturers‘ employees who sustain personal injuries as a result of using the raw materials in the manufacturing process. Only in extraordinary circumstances —such as when the raw materials are contaminated, the supplier exercises substantial control of the manufacturing process, or the supplier provides inherently dangerous raw materials— can suppliers be held liable. So the first issue was whether such circumstances existed here.

A few courts have imposed liability on suppliers of raw asbestos materials under negligence and strict liability causes of action.  The second issue was whether asbestos is unique in that it is inherently dangerous, and thus whether the holdings of those asbestos cases would be extended here.

Defendants mounted two kinds of challenges to the complaint. Some defendants filed demurrers; others filed motions for judgment on the pleadings. The trial court sustained the demurrers and granted the motions.  Plaintiff appealed.

The court of appeals noted that the component parts doctrine is set forth in section 5 of the Restatement Third of Torts, Products Liability, which provides:
―One engaged in the business of selling or otherwise distributing product components who sells or distributes a component is subject to liability for harm to persons or property caused by a product into which the component is integrated if:
―(a) the component is defective in itself, and the defect causes the harm; or
―(b)(1) the seller or distributor of the component substantially participates in the integration of the component into the design of the product; and (2) the integration of the component causes the product to be defective, and  (3) the defect in the product causes harm.

Product components include raw materials, bulk products, and other constituent products sold for integration into other products. The metal products at issue here were clearly raw materials because they could be used in innumerable ways, and they were not sold directly to consumers in the market place. Rather, they were sold to plaintiff‘s employer for the purpose of using them to manufacture other products. The metal products in this case were closer to raw materials like kerosene than they were to more developed components of finished products, such as airbags in cars, because they can be used in innumerable ways.

Under California law, component and raw material suppliers are not liable to ultimate consumers when the goods or material they supply are not inherently dangerous, they sell goods or material in bulk to a sophisticated buyer, the material is substantially changed during the manufacturing process, and the supplier has a limited role in developing and designing the end product. When these factors exist, the social cost of imposing a duty to the ultimate consumers far exceeds any additional protection provided to consumers. The rationale for not imposing liability on a supplier of product components is a matter of equity and public policy. Such suppliers ordinarily do not participate in developing the product components into finished products for consumers. Imposing liability on suppliers of product components would force them to scrutinize the buyer-manufacturer‘s manufacturing process and end-products in order reduce their exposure to lawsuits. This would require many suppliers to retain experts in a huge variety of areas, especially if the product components are versatile raw materials. Courts generally do not impose this onerous burden on suppliers of product components because the buyer- manufacturer is in a better position to ensure safety.

Although the complaint stated the legal conclusion that the metal products were inherently hazardous, the facts alleged indicated otherwise. Maxton was not injured by simply handling the metal itself, or even the final product containing the metal. Instead, Maxton was injured as a result of the manufacturing process, which altered the form and risks of the products. 

As for the contention that the metal products involved here were analogous to asbestos, the court disagreed. Asbestos itself is dangerous when handled in any form even if it is unchanged by the manufacturer. Indeed, asbestos is dangerous when it leaves the supplier‘s control. By contrast, the metal products in this case were not dangerous when they left defendants‘ control. They only became allegedly dangerous because of the manufacturing process controlled by the employer. (Nothing in the complaint indicated that defendants played any role whatsoever in developing or designing the end products.) 

The court of appeals declined to impose the social cost, meaning the practical burdens that liability would place on defendants as suppliers of the ubiquitous metal products involved in this case. Defendants would be required to assess the risks of using their metal products to manufacture other products. In order to make such assessments, defendants would need to retain experts on the countless ways their customers used their metal products. Defendants would also be placed in the untenable position of second-guessing their customers whenever they received information regarding potential safety problems. Courts generally do not impose this onerous burden on suppliers of product components because the buyer-manufacturers are in a better position to guarantee the safety of the manufacturing process and the end product.

Dismissal affirmed. 

 

Federal Court Upholds "Bare-Metal" Defense

A federal court last week became the latest to refuse to hold a defendant liable for injuries allegedly caused by asbestos-containing parts manufactured by others but used with the defendant's products. See Conner v. Alfa Laval Inc., No. MDL-875 (E.D. Pa.  2/1/12).

The issue arose in the consolidated asbestos products liability multidistrict litigation pending in the U.S. District Court for the Eastern District of Pennsylvania. Defendants moved for summary judgment on the ground that they were not liable for injuries caused by asbestos products, such as insulation, gaskets, and packing, that were incorporated into their products or used as replacement parts, but which they did not manufacture or distribute.

As the asbestos litigation has evolved, and the major manufacturing defendants have declared bankruptcy, the litigation has moved away from the manufacturers of asbestos to new types of defendants, including premises owners, and even those that manufactured so-called “bare-metal” products that contained or were later encapsulated in asbestos made by others. Litigants often refer to the defense raised in this case as the “bare-metal defense,” but it is more properly understood, as the court explained, as a challenge to a plaintiff’s prima facie case to prove duty or causation.

Here, the court considered the availability and scope of the so-called “bare-metal” defense under maritime law.

Plaintiffs alleged they developed mesothelioma as a result of exposure to defendants products while working on vessels operated by the U.S. Navy. One alleged he was exposed to asbestos products used with turbines while he served in the U.S. Navy from 1962 to 1971 aboard the U.S.S. Yorktown. (This was the 2d Yorktown;  under construction as Bon Homme Richard, this new Essex-class carrier was renamed Yorktown in honor of  the carrier sunk at the epic Battle of Midway  in June, 1942. Much of the Academy Award-winning documentary "The Fighting Lady" was filmed aboard the Yorktown.)

Another alleged he was exposed to asbestos aboard the U.S.S. Pollux and U.S.S. Delta, through products like turbines, pumps, boilers, and valves that used and, in some cases, were originally distributed with, asbestos-containing insulation, packing, gaskets, and other products.
The third alleged he was exposed to asbestos used with products while serving as a boiler tender in the U.S. Navy from 1959 to 1976 aboard various naval vessels.

Plaintiffs did not, however, proffer evidence that defendants manufactured or distributed the particular asbestos components or replacement parts to which they were allegedly exposed. Instead, they argued that defendants were liable for all the intended and foreseeable uses of asbestos parts in connection with their original products.

In determining whether defendant manufacturers were liable under maritime law for injuries caused by asbestos parts used with their products, whether in strict liability or negligence, a plaintiff must establish causation with respect to each defendant manufacturer. See Lindstrom v. A-C Prod. Liab. Trust, 424 F.3d 488, 492 (6th Cir. 2005). A plaintiff generally establishes causation under maritime law by showing (1) that the plaintiff was exposed to the defendant’s product and (2) that the product was a substantial factor in causing the plaintiff’s injury, said the court.

Plaintiffs raised two arguments to hold manufacturers liable for harm caused by asbestos products they did not manufacture or distribute. First, plaintiffs argued that under the integrated-products doctrine the “products” at issue were really defendants’ products together with the asbestos-containing components and replacement parts supplied by third parties.  Second, plaintiffs argued that defendants had a duty to warn of the hazards posed by the foreseeable uses of their products.

The court rejected both arguments. The first was not consistent with the law under the component parts doctrine. Even if the court were to accept that defendants were component-part manufacturers, a component-part manufacturer is not liable for injuries caused by the finished product into which the component is incorporated unless the component itself was defective at the time it left the manufacturer.  The defective product here was the asbestos insulation, not the pumps and valves to which it was applied after defendants’ manufacture and delivery.  Also, as a matter of law, defendants did not owe a duty to warn under maritime law of the hazards posed by products they did not manufacture or distribute.

The court cited with approval the view of other courts that the overwhelming case law does not support extending strict liability for failure to warn to those outside the chain of distribution of a product. Products liability has always been premised on harm caused by deficiencies in the defendant’s own product. Moreover, a manufacturer does not have an obligation to warn of the dangers of another manufacturer’s product.  The law does not impose a duty to warn about dangers arising entirely from another manufacturer’s product, even if it is foreseeable that the products will be used together.  Any expansion of the duty of care as urged here would impose an obligation to compensate on those whose products caused the plaintiffs no harm. To do so would exceed the boundaries established over decades of product liability law.  And it would also be unfair to require manufacturers of non-defective products to shoulder a burden of liability when they derived no economic benefit from the sale of the products that injured the plaintiff.

Having held as a matter of law that a manufacturer is not liable for harm caused by the asbestos products that it did not manufacture or distribute, the court concluded that plaintiffs failed to raise a genuine issue of material fact as to whether any of the defendants manufactured or distributed the asbestos products that caused the alleged injuries.

The decision puts the court in the company of others, like O'Neil v. Crane Co., Cal., No. S177401 (Cal. 1/12/12), which have declined to extend liability for asbestos-related injury to makers of products used with asbestos insulation, gaskets, and packing.  

State Supreme Court Reverses Dangerous Expansion of Product Liability

The California Supreme Court held last week that the law does not impose liability on manufacturers of equipment used in conjunction with asbestos-containing parts made by others.  See O'Neil v. Crane Co., Cal., No. S177401 (Cal. 1/12/12).
 
Readers may recall that we posted on this case before. The Restatement of Torts (Third): Products Liability says that in the context of a final, finished product that injures a user and which is made up of components from different manufacturers, if a given component is itself defective and the defect causes the harm, then the supplier of that component is of course liable. In addition, the supplier can be liable even if the component by itself is not defective, but only if the seller substantially participates in the integration of the component into the design of the product (and the defect causes the harm). See Restatement 3d, Section 5. In essence, the doctrine holds that an entity supplying a non-defective raw material or a non-defective component part is not strictly liable for defects in the final product over which it had no control. In this respect, the Third Restatement of Torts simply codified the doctrine of various states’ common law.
 
Nevertheless, a split had existed among the lower courts in California about whether to
extend liability for asbestos-related disease beyond the manufacturers of the asbestos insulation, gaskets, and packing to which many ship workers were exposed (and which makers are now bankrupt) to the makers of the products the asbestos was used with (to find a solvent target).  So the state supreme court confronted the limits of a manufacturer’s duty to prevent foreseeable harm related to its product: When is a product manufacturer liable for injuries caused by adjacent products or replacement parts that were made by others and used in conjunction with the defendant’s product?   It held that a product manufacturer may not be held liable in strict liability or negligence for harm caused by another manufacturer’s product unless the defendant’s own product contributed substantially to the harm, or the defendant participated substantially in creating a harmful combined use of the products.
 
Defendants made valves and pumps used in Navy warships. They were sued here for a wrongful death allegedly caused by asbestos released from external insulation and internal gaskets and packing, all of which were made by third parties and added to the pumps and valves post-sale. It is undisputed that defendants never manufactured or sold any of the asbestos-containing materials to which plaintiffs’ decedent was exposed. That is, no evidence was presented that any of the asbestos-containing dust came from a product made by defendants. Neither company manufactured or sold the external insulation or flange gaskets that the repairmen like plaintiff removed. Although the valves and pumps contained internal asbestos-containing gaskets and packing, these original components had been replaced long before plaintiff encountered them years later. There was no evidence that any of these replacement parts were made by defendants.  The Court of Appeal asserted defendants’ products were defectively designed “because they required asbestos packing and insulation.” But this factual assertion was unsupported by the record. The evidence established that the requirement for asbestos derived from military specifications, not from any inherent aspect of defendants’ pump and valve designs

Nevertheless, plaintiff claimed that defendants should be held strictly liable and found negligent because it was foreseeable that workers would be exposed to and harmed by the asbestos in replacement parts and products used in conjunction with their pumps and valves. The Court of Appeals held that the component parts defense applied only to manufacturers of “multi-use or fungible products” designed to be altered and incorporated into another product. It then concluded defendants’ products did not meet these requirements. The Court of Appeal also rejected defendants’ argument that they could not be found strictly liable because they did not manufacture or supply the asbestos-containing products that caused plaintiffs' disease. The lower court announced a broad definition of strict products liability: a manufacturer is liable in strict liability for the dangerous components of its products, and for dangerous products with which its product will necessarily be used. Even though it was replacement gaskets and packing that allegedly caused disease, the lower appeals court concluded these replacement parts were “no different” from the asbestos-containing components originally included in defendants’ products.
 

Plaintiff's claims would represent an unprecedented expansion of strict products liability, which the supreme court declined to do.  California law, like most states, has long provided that manufacturers, distributors, and retailers have a duty to see to the safety of their products, and will be held strictly liable for injuries caused by a defect in their products. Yet, the state has never held that these responsibilities extend to preventing injuries caused by other products that might foreseeably be used in conjunction with a defendant’s product. Nor has the state's high court ever held that manufacturers must warn about potential hazards in replacement parts made by others when, as here, the dangerous feature of these parts was not integral to the product’s design.  From the outset, strict products liability in California has always been premised on harm caused by deficiencies in the defendant’s own product.  The reach of strict liability is not limitless; strict liability does not extend to harm from entirely distinct products that the consumer can be expected to use with, or in, the defendant’s non-defective product. Instead, the courts require proof that the plaintiff suffered injury caused by a defect in the defendant’s own product.
 
In this case, it was undisputed that plaintiff was exposed to no asbestos from a product made by the defendants. Although he was allegedly exposed to potentially high levels of asbestos dust released from insulation the Navy had applied to the exterior of the pumps and valves, defendants did not manufacture or sell this external insulation. They did not mandate or advise that it be used with their products. It is fundamental that the imposition of liability requires a showing that the plaintiff’s injuries were caused by an act of the defendant or an instrumentality under the defendant’s control.
 
Generally speaking, manufacturers have a duty to warn consumers about the hazards inherent in their products. The requirement’s purpose is to inform consumers about a product’s hazards and faults of which they are unaware, so that they can refrain from using the product altogether or evade the danger by careful use. Typically, under California law, manufacturers are strictly liable for injuries caused by their failure to warn of dangers that were known to the scientific community at the time they manufactured and distributed their product. The supreme court has never held that a manufacturer’s duty to warn extends to hazards arising exclusively from other manufacturers’ products. Plaintiff's alleged exposure to asbestos came from replacement gaskets and packing and external insulation added to defendants’ products long after their installation; there was no dispute that these external and replacement products were made by other manufacturers.
 
So the supreme court reaffirmed that a product manufacturer generally may not be held strictly liable for harm caused by another manufacturer’s product. The only exceptions to this rule arise when the defendant bears some direct responsibility for the harm, either because the defendant’s own product contributed substantially to the harm or because the defendant participated substantially in creating a harmful combined use of the products.   Plaintiffs sought to expand these exceptions to make manufacturers strictly liable when it is foreseeable that their products will be used in conjunction with defective products or even replacement parts made or sold by someone else. However, the mere foreseeability of harm, standing alone, is not a sufficient basis for imposing strict liability on the manufacturer of a non-defective product, or one whose arguably defective product does not actually cause harm.
 
The decision was supported by common sense. A manufacturer cannot be expected to exert pressure on other manufacturers to make their products safe and is not able to share the costs of ensuring product safety with these other manufacturers. It would be unfair to require  manufacturers of non-defective products to shoulder a burden of liability when they derived no economic benefit from the sale of the products that injured the plaintiff.  And a contrary rule would require manufacturers to investigate the potential risks of all other products and replacement parts that might foreseeably be used with their own product and warn about all of these risks. Such a duty would impose an excessive and unrealistic burden on manufacturers. Such an expanded duty could also undermine consumer safety by inundating users with excessive warnings. “To warn of all potential dangers would warn of nothing.”
 
 
 
 

 

Huge Asbestos Verdict Vacated After Judge Recusal

A Mississippi state court late last month vacated the huge $322 million jury verdict in an asbestos case against Union Carbide Corp. See Union Carbide Corp. et al. v. Brown, No. 2006-196(Circuit Court of Smith County, Ms. 12/27/11).

The asbestos lawsuit in Smith County was filed by plaintiff Thomas Brown Jr., who alleged he worked in the state’s oil fields from 1979 to the mid-1980s and was diagnosed with asbestosis. He claimed that he had been exposed to asbestos when mixing drilling products manufactured by Union Carbide.

A state court jury found the defendants liable under defective design and failure to warn claims, awarding $22 million in compensatory damages and $300 million in punitives, probably the largest asbestos verdict for a single plaintiff in the history of the grandfather of mass torts. Later, the state Supreme Court disqualified the trial judge after information surfaced that the judge's parents had brought asbestos lawsuits.

As profiled by the U.S. Chamber of Commerce's Institute for Legal Reform, the new judge appointed to handle the matter granted the defendant's motions to set aside the verdict.  Plaintiff's counsel had argued that the recusal didn’t justify throwing out the verdict.

 

Substantial Cause Explored in Case of Multiple Exposures

The Sixth Circuit issues and interesting opinion last week, exploring plaintiff's burden to prove that exposure to defendant's product caused his injury in the context in which plaintiff was exposed to numerous other similar products. See Moeller v. Garlock Sealing Technologies LLC, No. 09-5670, (6th Cir., 9/28/11).

Plaintiff was a pipefitter who worked with asbestos-containing gaskets made by Garlock from about 1962 until about 1970. But from 1962 until about 1975, he also sustained significant exposure to asbestos insulation. He contracted mesothelioma and sued, alleging that his exposure to Garlock’s asbestos-containing gaskets was a substantial factor in causing his injuries.

At trial, plaintiff's expert testified that exposure to asbestos from Garlock gaskets, along with his other exposures, contributed to the mesothelioma. And one of the treating oncologists opined  that if plaintiff had worked for many years (as he did) scraping and grinding asbestos gaskets, and if plaintiff breathed those fibers, then that exposure would have caused his cancer. In rebuttal, Garlock presented evidence that plaintiff had sustained substantial exposure to asbestos insulation products for 13 years. It also presented evidence that whereas asbestos insulation was banned in the 1970s, leading asbestos safety authorities believed that gaskets, such as those sold by Garlock, posed “no health hazard,” and were sold lawfully in the United States. Garlock also suggested that the plaintiff had only installed Garlock gaskets (an activity that both parties agree did not create a risk of injury), and had not ever removed them (the activity that the plaintiff alleges caused the injuries).

The jury returned a verdict for plaintiff, and defendant appealed.

To prevail on a negligence claim, Kentucky law requires a plaintiff to prove that a defendant’s conduct was a substantial factor in bringing about the harm. Deutsch v. Shein, 597 S.W.2d 141, 144 (Ky. 1980). Causation requires a link between the specific defendant’s conduct and the plaintiff’s injuries. See Estes v. Gibson, 257 S.W.2d 604, 607 (Ky. 1953) . Substantial causation refers to the probable cause, as opposed to a possible cause. One measure of whether an action is a substantial factor is the number of other factors which contribute in producing the harm and the extent of the effect which they have in producing it.

The appeals court concluded that the plaintiff failed to prove that Garlock’s product was a substantial factor in bringing about the harm. The plaintiff presented various witnesses to support the claim that the mesothelioma was caused by his exposure to Garlock gaskets. But one expert never actually said that the exposure to Garlock gaskets was a substantial factor in causing the  cancer; the others testified that all types of asbestos can cause mesothelioma and that any asbestos exposure counts as a “contributing factor.”  That testimony does not establish that exposure to Garlock gaskets in and of itself was a substantial factor.

Moreover, the evidence presented was insufficient to allow a jury to infer that exposure to Garlock gaskets was a substantial cause of the cancer. Plaintiff here presented no evidence quantifying  exposure to asbestos from Garlock gaskets. There was testimony that he removed gaskets for several years, and that some of those gaskets were Garlock’s. But the plaintiff failed to establish how many Garlock gaskets he removed, or how frequently he removed—as opposed to installed—them. The record also shows that plaintiff regularly tore out asbestos insulation during the relevant years, and that his exposure to asbestos from insulation would have been thousands of times greater than his exposure from removing gaskets.

Thus, while his exposure to Garlock gaskets may have contributed to his mesothelioma, the record simply does not support an inference that it was a substantial cause of his mesothelioma. Given that the Plaintiff failed to quantify his exposure to asbestos from Garlock gaskets and that the Plaintiff concedes that he sustained massive exposure to asbestos from non-Garlock sources, there is simply insufficient evidence to infer that Garlock gaskets probably, as opposed to possibly, were a substantial cause of the injury.

The court summed it up: saying that exposure to Garlock gaskets was a substantial cause of plaintiff’s mesothelioma would be akin to saying that one who pours a bucket of water into the
ocean has substantially contributed to the ocean’s volume.

 

State Court Finds No Duty to Spouse of Exposed Worker

Delaware's supreme court held last month that an employer owes no duty of care to an employee's spouse, who allegedly contracted asbestos-related disease from exposure to her spouse's work clothes. Price v. E.I. du Pont de Nemours & Co., No. 719, 2009 (Del. 7/11/11).

Bobby Price worked as a maintenance technician in defendant's facility from 1957 until 1991. During his employment, Mr. Price allegedly worked with and around products containing asbestos. Allegedly, Mr. Price transported asbestos fibers home on his clothing, vehicle, and skin. Patricia Price, his wife, alleged that years of living with her husband, and handling and washing his work clothes, exposed her to the fibers. Mrs. Price claimed to suffer from bilateral interstitial fibrosis and bilateral pleural thickening of the lungs. These maladies, she claimed, stemmed directly from her exposure to the asbestos dust and fibers her husband brought home from work.

Plaintiff sued, alleging that the company wrongfully released asbestos from its plant and that she was a reasonably foreseeable victim of its asserted misconduct. 

To prevail on a negligence claim under Delaware law, a plaintiff must prove that a defendant owed her a duty of care, the respondent breached that duty, and the breach proximately caused an injury. Whether a duty exists is a question of law, typically. To determine whether one party owed another a duty of care, Delaware courts look to the Restatement (Second) of Torts for guidance.  Negligent conduct involves either (1) an act which the actor as a reasonable person should recognize as involving an unreasonable risk of causing an invasion of an interest of another (described in some cases as misfeasance), or (2) a failure to do an act which is necessary for the protection or assistance of another and which the actor is under a duty to do (sometimes described as nonfeasance).

Plaintiffs moved to amend the complaint to state a claim based on an asserted theory of misfeasance—that the release of asbestos was carried into a worker's home — rather than a claim of nonfeasance based on a failure to warn. The Delaware court noted that in the case of misfeasance, the party who does an affirmative act owes a general duty to others to exercise reasonable care, but, in the case of nonfeasance, the party who merely omits to act owes no general duty to others unless there is a "special relationship" between the actor and the other which gives rise to the duty.

DuPont contended that as a matter of substance the amended complaint really alleged  nonfeasance—not misfeasance. Again, in order to recover for nonfeasance, a plaintiff must specifically allege a “special relationship” between herself and the defendant. Having not alleged any “special relationship” in this case, DuPont argued, Price’s amendments were futile because they failed to state a claim as a matter of law.

The court noted that Price’s allegations, stripped of all reformatory re-characterization, were that: (1) Mr. Price, an employee of defendant, worked with and around products containing asbestos for 34 years, (2) asbestos fibers settled on his skin, clothing, and vehicle, (3) defendant allegedly did not provide locker rooms, uniforms, or warnings to the Prices regarding the dangers of asbestos, (4) defendant did not prevent Mr. Price from transporting the asbestos fibers home on his skin, clothing, and vehicle, and (5) Mrs. Price, because she lived with Mr. Price and washed his clothes, developed disease. These alleged acts were pure nonfeasance—nothing more. Dupont’s alleged failures to prevent Mr. Price from taking asbestos fibers home or to warn the Prices about the dangers of asbestos did not rise to the level of affirmative misconduct required to allege a claim of misfeasance. No amount of semantics can turn nonfeasance into misfeasance or
vice versa.

Having alleged only nonfeasance, Price needed to allege that a “special relationship” existed between her and DuPont in order for DuPont to owe her a duty of care. But the relationship between Mrs. Price and DuPont did not fit any of the recognized “special relationships”
giving rise to a duty to aid or protect. Just because her husband worked for DuPont for over thirty years, or DuPont provided health insurance to her as Mr. Price’s spouse, or DuPont sponsored company picnics and participated in programs promoting a "family friendly" workplace, a special relationship did not exist. 

The plaintiff's bar has been aggressive in efforts to create new methods of recovery from asbestos exposures -- new defendants, new legal theories, new injuries, new plaintiffs. For once, a court has put the brakes on this seemingly endless expansion. 

 


 

New Report on Asbestos and Silica Litigation in Texas

The Texas Civil Justice League has released a new report, "A Texas Success Story: Asbestos and Silica Lawsuit Reform."

Established in 1986, the Texas Civil Justice League is a non-partisan, statewide business coalition committed to legal reform and public policy research. The League makes legislative recommendations in vital issue areas, such as administration of the courts, general business liability, mass torts, and products liability.

The purpose of this special report is to document the current state of asbestos and silica litigation in Texas state courts. Part one provides a brief history of asbestos and silica litigation in the United States and an overview of the legislative efforts in Texas to address abuses in asbestos and silica litigation.  The report then offers a description of asbestos and silica litigation in Texas’s two multidistrict litigation courts handling asbestos and silica cases, and the impact of reform legislation (S.B. 15) on the state MDLs.

The report then turns to recent issues in asbestos litigation, specifically to the science-based evidentiary standards required by the Texas Supreme Court’s decision in Borg-Warner Corp. v. Flores.

Next are the issues relating to asbestos claimant compensation, starting with the role of bankruptcy trusts in compensating asbestos claimants; the bankruptcy trust payment system can provide substantial compensation to asbestos victims, but is a “black box” system that remains hidden from public scrutiny.

Lots of good info, worth a read.

New Report on Asbestos and Silica Litigation in Texas

The Texas Civil Justice League has released a new report, "A Texas Success Story: Asbestos and Silica Lawsuit Reform."

Established in 1986, the Texas Civil Justice League is a non-partisan, statewide business coalition committed to legal reform and public policy research. The League makes legislative recommendations in vital issue areas, such as administration of the courts, general business liability, mass torts, and products liability.

The purpose of this special report is to document the current state of asbestos and silica litigation in Texas state courts. Part one provides a brief history of asbestos and silica litigation in the United States and an overview of the legislative efforts in Texas to address abuses in asbestos and silica litigation.  The report then offers a description of asbestos and silica litigation in Texas’s two multidistrict litigation courts handling asbestos and silica cases, and the impact of reform legislation (S.B. 15) on the state MDLs.

The report then turns to recent issues in asbestos litigation, specifically to the science-based evidentiary standards required by the Texas Supreme Court’s decision in Borg-Warner Corp. v. Flores.

Next are the issues relating to asbestos claimant compensation, starting with the role of bankruptcy trusts in compensating asbestos claimants; the bankruptcy trust payment system can provide substantial compensation to asbestos victims, but is a “black box” system that remains hidden from public scrutiny.

Lots of good info, worth a read.

State Court Allows Double-Dipping Asbestos Claim

A state appeals court has ruled that an employer may face liability under New Jersey law for allegedly exposing a plaintiff to asbestos through contact with her husband's work clothes, even if she also had worked for the employer as a direct employee herself. See Anderson v. A.J. Friedman Supply, et al., No. A-5892-07T1, 2010 WL 3289061 (N.J. Super. Ct. App. Div.,  8/20/10).

Plaintiffs alleged that Bonnie Anderson contracted mesothelioma from one or both exposures to asbestos at the Linden Bayway Refinery owned by defendant Exxon Mobil Corporation (and home of the state's largest Christmas tree apparently).  The first was bystander exposure from laundering her husband John's asbestos-laden work clothes during his employment with Exxon from 1969 to 2003. (In Olivo v. Owens-Illinois Inc., 186 N.J. 394 (2006), the court had found that an employer could be liable for indirectly exposing family members to the asbestos fibers found on an employee's work clothes.)  The second was alleged direct exposure during Bonnie's own employment with Exxon from 1974 to 1986.

At trial, plaintiffs focused on the bystander exposure, and tried to downplay any significant exposure at work.  A defense expert agreed that the only epidemiologically established cause of mesothelioma is asbestos exposure; it is commonly accepted today that it's possible that women can get mesothelioma from asbestos dust brought home on the clothing of a husband or parent; and that mesothelioma has an average latency period of thirty-two years.

The trial court charged the jury that asbestos brought home by John need not have been the sole cause of plaintiff's asbestos-related injuries, but it must be a substantial contributing factor, and if the jury were to find that Bonnie's exposure occurring during the course of her employment was the sole cause of her injury or disease, it should return a verdict for Exxon.

Exxon appealed  from a judgment in favor of plaintiffs, awarding more than $7 million to the Andersons in compensatory damages.

The appellate court noted that this case presented a novel scenario of a single injury arising after a long latency period caused by one of two, or both, asbestos exposures.  The court of appeals framed the question as whether Mrs. Anderson could continue to assert a claim against Exxon if she was exposed as a result of washing the clothes but she was also an employee with possible direct exposure at that time. 

As to that question, the court turned to the "dual persona doctrine," which under New Jersey law generally provides that an employer may become like a third person, vulnerable to tort suit by an employee, outside the normal bar of the exclusivity of the workers compensation system, if and only if it possesses a second persona so completely independent from and unrelated to its status as employer that by established standards the law recognizes that persona as a separate legal person.

The court could find no close precedents, but one might think that the role of the defendant as employer of husband and wife and its supposedly distinct role in the alleged exposure due to the husband's work-related clothing do not rise to the the level of separate legal persons.  But the court affirmed the trial court's reasoning that Exxon had such a dual persona, having an employer capacity for an eight year period, but then having a separate "relationship" to Mrs. Anderson as a bystander for 20 years. It was thought unfair to the plaintiff not to let her pursue her claim based on her bystander exposure, which had "absolutely nothing" to do with her employment relationship with Exxon. That is, although Exxon could not be held liable based on her direct occupational exposure, it could be held liable pursuant to her separate exposure to the asbestos brought home by John from his Exxon job.

One might assume that if the employer was a "separate legal person" who was not protected by the workers comp scheme for purposes of the alleged bystander exposure, then at least the defendant could get some recognition on the verdict form of this separate legal entity/status.  But even though the trial judge viewed Exxon as "standing in two different pairs of shoes," the court refused Exxon's request to have the two legal persons listed on the verdict sheet, and declined to direct the jury to allocate fault between Bonnie's direct asbestos exposure as an Exxon employee and any bystander exposure from washing John's work clothes.

The court of appeals agreed, reasoning that the jury could not allocate any fault to Exxon as Bonnie's employer, because Exxon was immune from suit pursuant to the Workers Comp Act. The state's comparative fault doctrine provides that fault shall be allocated among each "party" in the case. The workers' compensation bar precluded Exxon from being a "party" in this litigation in its status as Bonnie's employer.

Thus, defendants like Exxon get the worst of both worlds: no safe haven under workers' compensation for having been the plaintiff's employer, and no allocation of fault to the "distinct" exposure because it was the employer under the workers comp scheme!

 

Case of Successor Liability for Asbestos Exposure Claims

New York's highest court has ruled that a buyer assumed the liability for certain asbestos-related claims under a sale contract when it bought the boiler business of plaintiff American Standard Inc. back in 1970. American Standard Inc. v. Oakfabco Inc., 2010 WL 1286394 (N.Y., 4/6/10).

The court said that the issue here was whether the buyer of a boiler business assumed the seller's liabilities for tort claims based on boilers sold before the business was acquired, even where the tort claimants were not exposed/injured until after the acquisition. In 1970, American Standard, Inc. sold its Kewanee Boiler division to OakFabco, Inc. The parties entered an asset purchase and sale agreement in which the buyer assumed certain liabilities. The boilers manufactured by Kewanee had been insulated with asbestos, and as a result many tort claims were brought in the years and decades following the purchase of the business.

Some of those claims were brought by plaintiffs who had suffered injuries after the closing of the transaction, allegedly attributable to boilers manufactured and sold before the closing. In this declaratory judgment action brought by American Standard against OakFabco, the issue was whether liabilities for such injuries were among the liabilities that OakFabco assumed.  OakFabco argued that the definition of the liabilities OakFabco assumed was limited to "existing and outstanding” liabilities as of the Closing Date. According to OakFabco, a tort claim cannot be “existing and outstanding” before the tort plaintiff has been exposed and injured, because until then it is not possible for a tort lawsuit to be brought.

The court found, however, that the overall contract language meant that the buyer would deal with any problems customers had after the closing date with boilers that had been installed previously. It would have been absurd for OakFabco, said the court, to tell a customer whose boiler failed after the closing that, since the customer's claim was not “existing and outstanding” on the closing date, it was not OakFabco's problem. By including warranty, service, repair and return claims in the definition of liabilities, the parties demonstrated that they were not reading the words “existing and outstanding” as OakFabco now did.

The court therefore concluded that the liabilities assumed by OakFabco included claims brought by tort claimants injured after the closing date by boilers installed before that date.

The case is a timely reminder that an important aspect of evaluating the possible acquisition of a target company is the potential litigation liability that may be acquired simultaneously. If a target company is involved, or could potentially become involved, in mass tort litigation, it presents both risk and opportunity to the acquirer. The threat of this type of litigation may result in the opportunity to acquire a target at a below-market valuation multiple, and the uncertainty caused by mass tort exposure can result in valuation discounts that make the attendant risk acceptable. There are potentially significant risks, however, associated with mass tort litigation exposure, such as in asbestos, and thus buyers must proceed carefully. In the private equity context, in particular, mass tort litigation exposure can adversely impact the ability to secure third-party debt financing and can have an adverse impact on investment exit. Private equity purchasers may have shorter investment time frames than strategic buyers, and mass tort litigation often takes a substantial amount of time to resolve itself.

The general rule of law, and the typical structure of an asset purchase agreement, is that an acquirer of the assets of another corporation for cash does not acquire the liability for prior injuries caused by products sold by the target company prior to closing. It is crucial that the language be clearly drafted to reflect the parties' agreement on the allocation of such liability.

Even when the parties purport to allocate such liability to the target, however, the buyer may find itself responsible for the litigation through the operation of various legal doctrines that are exceptions to the general rule. The Restatement (Third) of Product Liability Law notes that a business entity that acquires assets of a predecessor business entity is subject to liability for harm caused by a defective product sold by the predecessor if the acquisition results from a fraudulent conveyance to escape liability for the liabilities of the predecessor, or results in the successor becoming a mere continuation of the predecessor. A few states also add the so-called “product line” exception, which allows a plaintiff to recover for injuries caused by a defective product sold by the predecessor in cases in which the successor corporation has continued the predecessor’s product line.

Thus, even in the absence of an actual merger or stock acquisition, or contract language assuming liability, it may be that a buyer of corporate assets will still face exposure to product litigation liability risks. Attempting to structure the deal to try to minimize the possible application of such theories will often be the first line of defense. In an asset sale, the buyer may also want to seek a provision that the seller shall not dissolve for some set period of time, so that the mass tort plaintiffs’ other remedies seemingly are not destroyed. Special indemnification by the seller for the underlying exposure is another alternative. This indemnification should survive for a sufficient period of time, and ideally would not be subject to a special cap higher than is typical for representations made by a “clean” company. The use of a special escrow to set aside funds for the litigation indemnification may be important.
 

How Much Did They Pay? I Need to Know

Many mass torts involve multiple defendants, and many of our readers have been in the position of hearing that co-defendants had settled out of the case.  It is natural to wonder, and could be quite useful to know, what co-defendants paid to settle their part of the case.  Typically, the agreements are subject to confidentiality agreements, and the protections of Fed. R. Evid. 408, which recognizes the strong public policy promoting settlement. See Block Drug Co. v. Sedona Labs., Inc., 2007 WL 1183828, at *1 (D.Del. Apr.19, 2007); Fidelity Fed. Sav. & Loan Assn. v. Felicetti, 148 F.R.D. 532, 534 (E.D.Pa.1993).

A recent federal case tested these boundaries.  Dent v. Westinghouse, et al., 2010 WL 56054 (E.D.Pa. Jan. 4, 2010).  Warren Pumps, a defendant in multi-party asbestos litigation, filed a motion to compel the plaintiff to respond to certain interrogatories and requests for production of documents regarding the settlement of any claim asserted in the complaint. Plaintiff objected.  The thrust of Warren Pumps' argument was that the discovery about each additional asbestos-containing product which plaintiff claims caused his mesothelioma made it that much less likely that his mesothelioma was caused by exposure to any Warren Pump product.  And it allegedly made plaintiff's assertions to the contrary less and less credible.

Warren Pumps pointed out that on its face Rule 408 pertains to the admissibility of evidence, and argued it was inapplicable to a discovery dispute. (citing DirecTV, Inc. v. Puccinelli, 224 F.R.D. 677, 685 (D.Kan.2004)).  Although Rule 408 speaks in terms of admissibility, several courts have concluded that a heightened showing is required for even the discovery of settlement information. That is, they have required a more particularized showing that the evidence of settlement sought is relevant and calculated to lead to the discovery of admissible evidence. Block Drug, 2007 WL 1183828, at *1; Lesal Interiors, Inc. v. Resolution Trust Corp., 153 F.R.D. 561, 562 (D.N.J.1994)). 

Warren Pumps also argued that it was not seeking the information for any purpose prohibited by the rule.  Rule 408 bars the use of settlement information “to prove liability for, invalidity of, or amount of a claim....” F.R.E. 408(a). Among other purposes, Rule 408 specifically permits settlement evidence to show a witness's bias or prejudice. F.R.E. 408(b).  The defendant contended that it was merely seeking the settlement information to test the credibility of plaintiff's claims.

The court found this was merely "repackaging" the motives forbidden by Rule 408 by placing them under the guise of credibility.  To the extent the defendant was seeking the information to determine whether the dismissed co-defendants were dismissed for lack of evidence, Warren Pumps wanted to impugn the credibility of plaintiff's claims against Warren Pumps by virtue of his apparently merit-less claims against the dismissed co-defendants. Thus, Warren Pumps sought the information to prove the invalidity of the claims against it, a use which Rule 408 prohibits, said the court.  To the extent defendant sought the settlement information, and the amounts of those settlements, it was trying to show that if plaintiff had settled with a co-defendant more or less equivalent in culpability to Warren for a certain sum of money, and thus established the value of his damages with regard to that co-defendant, it would not be credible for plaintiff to seek a higher sum from Warren.   But, said the court, this would be using the settlement information to establish the amount of plaintiff's claim against Warren Pumps. Again, this is forbidden by Rule 408.

Bottom line, the discovery was denied because while disclosure of the settlement agreements would reveal the amount of money plaintiff received from other asbestos manufacturers, the settlement amounts could not then be used to prove the extent of plaintiff's exposure to, or damages from, asbestos from another manufacturer's product.

Component Part Seller Liability At Issue In Asbestos Case

California's high court is preparing to address a split among the state's lower courts on what seems to be a straightforward issue of product liability law governing component parts.

The Restatement of Torts (Third): Products Liability says that in the context of a final, finished product that injures a user and which is made up of components from different manufacturers, if a given component is itself defective and the defect causes the harm, then the supplier of that component is of course liable. In addition, the supplier can be liable even if the component by itself is not defective, but only if the seller substantially participates in the integration of the component into the design of the product (and the defect causes the harm). Restatement 3d, Section 5.

In essence, the doctrine holds that an entity supplying a non-defective raw material or a non-defective component part is not strictly liable for defects in the final product over which it had no control.  In this respect the Third Restatement of Torts simply codified the doctrine of various states’ common law. E.g., TMJ Implants Products Liability Litigation, 872 F. Supp. 1019 (D. Minn. 1995), aff’d, 97 F.3d 1050 (8th Cir. 1996) (applying Minnesota law)); Kealoha v. E.I. Du Pont de Nemours & Co., 844 F. Supp. 590 (D. Hawaii 1994), aff’d, Kealoha v. E.I. Du Pont de Nemours & Co., et al., 82 F.3d 894 (9th Cir. 1996) (applying Hawaii law); Jacobs v. E.I. Du Pont de Nemours & Co., 67 F.3d 1219 (6th Cir. 1995) (applying Ohio law); Apperson v. E.I. Du Pont de Nemours & Co., 41 F.3d 1103 (7th Cir. 1994) (applying Illinois law); Crossfield v. Quality Control Equip. Co., Inc., 1 F.3d 701 (8th Cir. 1993) (applying Missouri law); Childress v. Gresen Mfg. Co., 888 F.2d 45 (6th Cir. 1989) (applying Michigan law); In Re: Silicone Gel Breast Implants Products, 996 F. Supp. 1110 (N.D. Ala. 1997); Travelers Ins. Co. v. Chrysler Corp., 845 F. Supp. 1122 (M.D.N.C. 1994); Sperry v. Bauermeister, 786 F. Supp. 1512 (E.D. Mo.1992); Estate of Carey v. Hy-Temp Mfg., Inc., 702 F. Supp. 666 (N.D. Ill. 1988); Orion Ins. Co., Ltd. v. United Tech. Corp., 502 F. Supp. 173 (E.D. Pa. 1980); Mayberry v. Akron Rubber Machinery Corp., 483 F. Supp. 407 (N.D. Okla. 1979); Artiglio v. General Electric Co., 61 Cal.App.4th 830 (Cal. Ct. App. 1998); Bond v. E.I. Du Pont de Nemours & Co., 868 P.2d 1114 (Colo. Ct. App. 1993); Shaw v. General Motors Corp., 727 P.2d 387 (Colo. Ct. App. 1986); Castaldo v. Pittsburgh-Des Moines Steel Co., Inc., 376 A.2d 88 (Del. 1977); Depre v. Power Climber, Inc., 263 Ill.App.3d 116 (Ill. App. Ct. 1994); Curry v. Louis Allis Co.,
Inc., 100 Ill.App.3d 910 (Ill. App. Ct. 1981); Murray v. Goodrich Eng’g Corp., 30 Mass. App. Ct. 918 (Mass. App. Ct. 1991); Welsh v. Bowling Electric Machinery, Inc., 875 S.W.2d 569 (Mo. Ct. App. 1994); Zaza v. Marquess & Nell, Inc., 144 N.J. 34 (N.J. 1996); Parker v. E.I. Du Pont de Nemours & Co., Inc., 121 N.M. 120 (N.M. Ct. App. 1995); Munger v. Heider Mfg. Corp., 90 A.D.2d 645 (N.Y. App.
Div. 1982); Hoyt v. Vitek, Inc., 134 Ore. App. 271 (Or. Ct. App. 1995); Moor v. Iowa Mfg. Co., 320 N.W.2d 927 (S.D. 1982); Davis v. Dresser Indus., Inc., 800 S.W.2d 369 (Tex. App. 1990); Bennett v. Span Indus., Inc., 628 S.W.2d 470 (Tex. App. 1982); Westphal v. E.I. Du Pont de Nemours & Co., 192 Wis. 2d 347 (Wis. Ct. App. 1995); Noonan v. Texaco, Inc., 713 P.2d 160 (Wyo. 1986).

Sometimes the issue is analyzed as one of no duty on the part of the component seller; other courts view it as an absence if causation.  The policy reasons behind the component parts doctrine are well established. Multi-use component and raw material suppliers should not have to assure the safety of their materials as used in other companies' finished products. That would require suppliers to retain experts in a huge variety of areas in order to determine the possible risks associated with each potential use. And finished product manufacturers know exactly what they intend to do with a component or raw material and therefore are in a better position to guarantee that the component or raw material is suitable for their particular applications.  In the drug and device area, liability is inconsistent with the FDA regulatory scheme because suppliers cannot warn consumers of dangers created by the design of the finished product; the FDA controls who warns and what the warning says.

But when a component manufacturer sufficiently participates in designing a defective and unreasonably dangerous final product, the component manufacturer may be held liable for injuries caused by the final product even though the component itself was not defective or unreasonably  dangerous.  Which raises the question what is ‘‘substantial participation.’’ The Restatement suggests the courts look at whether: (1) the manufacturer or assembler of the integrated product invited the component manufacturer to design a component that would perform specifically as a part of the integrated product;  (2) the component part manufacturer assisted the seller in modifying the design of the integrated product so that it would accept the component part, or (3) the component part manufacturer played a substantial role in deciding which component best serves the requirements of the seller’s integrated product.

A common mass tort battleground for these issues is asbestos.  In O'Neil v. Crane Co., 177 Cal.App.4th 1019, 99 Cal.Rptr.3d 533 (2009)(review granted 12/23/09), the plaintiffs, the widow and children of a naval officer who died of mesothelioma, sued the manufacturers of shipboard pumps and valves, alleging that asbestos insulation used with those components caused the injury.  The trial court dismissed the claims under the component part make doctrine, but last Fall, a panel of the Second Appellate District overturned the trial court's dismissal and said the pump and valve makers could be liable for the officer's death.

The court found that the defendants did not supply a “building block” material, dangerous only when incorporated into a final product over which they had no control. Rather, they sold finished valves and pumps, which needed insulation of some kind. That analysis did not give sufficient attention to the notion that the steam system of the ship ought to be viewed as the finished product, as that term is used in the context of the component parts defense. And it gave insufficient weight to the basic policy underlying the compnent part doctrine.

The panel disagreed with the trial court and with two other appellate decisions going the other way. The state's First Appellate District in Taylor v. Elliott Turbomachinery Co., 171 Cal. App. 4th 564 (2009), found  that pump and valve manufacturers were not liable —as manufacturers of non-defective component parts of a greater whole, and as manufacturers of separate products from those (asbestos) that actually caused the alleged harm. And a different panel of the Second District, Merrill v. Leslie Controls Inc. (Cal. Ct. App., 2d App. Dist., No. B200006, 11/17/09), had also declined to find liability in similar circumstances. See generally Lindstrom v. A-C Product Liability Trust, 424 F.3d 488 (6th Cir.2005)(no liability; causation focus). 

That a component seller knew or should have known that the product maker might use potentially hazardous materials in its design should never be sufficient to impose liability for the design that is the responsibility of the finished product seller.  It makes no sense to have suppliers act as "design police" for every possible item their non-defective part could possibly be combined with in a finished product. 

Under a proper analysis, a warning claim should fare no differently. See Braaten v. Saberhagen Holdings, 198 P.3d 493 (Wash. 2008); Simonetta v. Viad Corp., 197 P.3d 127 (Wash. 2008)(no liability for failure to warn of the hazards of exposure to another manufacturer's asbestos insulation).  The Washington court found the duty to warn under common law negligence was limited to those in the chain of distribution of the hazardous product. Because the defendants did not manufacture, sell, or supply the asbestos insulation, the defendants could not be found liable for breaching a duty to warn. The defendants were not strictly liable because only a product's manufacturer, seller, or marketer is in the position of knowing its dangerous aspects.  To hold a defendant strictly liable for another party's product would be manifestly unfair.

The California Supreme Court has recently agreed to review the issue. O'Neil v. Crane Co., Cal., No. S177401, (petition for review granted 12/23/09).  Here's hoping the doctrine is applied correctly, and this does not become another "asbestos" law exception to common sense rules.

Supreme Court Issues Opinion in Much-Watched Manville Insurer Asbestos Case

The U.S. Supreme Court has ruled that an injunction against lawsuits in the landmark bankruptcy case of asbestos manufacturer Johns-Manville does in fact bar claims now asserted by asbestos plaintiffs against the company’s insurer, Travelers Indemnity Co.  In a 7-2 decision, the Supreme Court reversed an opinion by the U.S. Court of Appeals for the Second Circuit, ruling that a bankruptcy judge properly interpreted the 1986 injunction to apply to the later claims.

MassTortDefense alerted readers to this case late last year. The case arises from the now-decades old Manville bankruptcy. From the 1920s until the 1970s, Johns-Manville was the largest manufacturer of asbestos-containing products and the largest supplier of raw asbestos in the United States. As a result, in the 1960s and 1970s, Johns-Manville became the target of many product liability suits. Johns-Manville filed for Chapter 11 protection under the federal bankruptcy law on Aug. 26, 1982. On that date, Johns-Manville was a defendant in more than 12,500 asbestos-related suits. To fund its reorganization plan, the bankruptcy court allowed Johns-Manville to settle its insurance claims for about $850 million.

Travelers, Johns-Manville's primary insurer from 1947 to 1976, paid about $100 million into the bankruptcy estate in exchange for a full and final release of Manville-related claims. In 1986, Bankruptcy Judge Lifland entered a series of confirmation orders, inter alia barring any person from commencing any actions based upon, arising out of, or related to insurance policies that Travelers issued to Manville. In 2004, Judge Lifland found that his injunction was being violated by a new species of asbestos-related lawsuits (referred to by some as “direct action” claims) against insurers. These new asbestos claims were part of a global strategy developed by the plaintiffs' bar to put insurers in Manville's shoes and thereby hold them liable on account of their insurance relationship with Manville. The injunction in the meantime had become the model for a statutory change adopted as part of the Bankruptcy Reform Act of 1994, establishing Section 524(g) of the Bankruptcy Code, which expressly authorized the Manville approach to be used in future asbestos bankruptcies.  So the attacks had potentially widespread significance.

The Second Circuit, rather than enforce the confirmation order as it was originally written, which had been affirmed on a prior appeal, ruled that Judge Lifland had exceeded the “subject matter jurisdiction” granted by the bankruptcy code. In re: Johns-Manville Corp., 517 F.3d 52 (2d Cir. 2008). The Second Circuit concluded that the bankruptcy court in 1986 was without power to enjoin all claims that literally arise out of the insurance policies that Manville purchased from Travelers. Thus, the bankruptcy court had also exceeded its authority in approving a multi–million dollar settlement of asbestos claims filed against Travelers. The appeals court said the bedrock issue in this case required a determination as to whether the bankruptcy court had jurisdiction over the disputed statutory and common law claims. While the bankruptcy court repeatedly used the terms “arising out of” and “related to,”  global finality for Travelers is only as global as the bankruptcy court's jurisdiction.

The Supreme Court, however, held "that the terms of the injunction bar the actions and that the finality of the bankruptcy court’s orders following the conclusion of direct review generally stands in the way of challenging the enforceability of the injunction.” Justice David Souter wrote for the majority. The 1986 Orders became final on direct review over two decades ago, and whether the Bankruptcy Court had jurisdiction and authority to enter the injunction in 1986 was not properly before the Court of Appeals in 2008. 

The respondents' position that the 1986 Orders only bar actions against insurers when those actions seek to recover derivatively for Manville’s wrongdoing, but not actions to recover for Travelers’ own alleged misconduct, simply is not what the 1986 Orders say. There is no language limiting it to derivative claims.  The Bankruptcy Court in this case plainly had jurisdiction to interpret and enforce its own prior orders, in part because it explicitly retained jurisdiction to enforce its injunctions.  Once the 1986 Orders became final on direct review (whether or not proper exercises of bankruptcy court jurisdiction and power), they became res judicata to the parties and those in privity with them, not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose. Those orders are not any the less preclusive because the attack is on the Bankruptcy Court’s conformity with its subject-matter jurisdiction, for even subject-matter jurisdiction generally may not be attacked collaterally.

The Court stated that "our holding is narrow."  They did not resolve whether a bankruptcy court, in 1986 or today, could properly enjoin claims against non-debtor insurers that are not derivative of the debtor’s wrongdoing. Still an important issue in a mass tort driven bankruptcy.  Nor did the Court decide whether any particular respondent is bound by the 1986 Orders.   Thus, the Court appeared to be making an effort not to address the actual underlying issue here.

In a dissenting opinion, however, Justices John Paul Stevens and Ruth Bader Ginsburg
sided with the Second Circuit, arguing that the bankruptcy court had exceeded its jurisdiction by barring the suits. 

Bills Pending To Overturn Important Causation Decision

Two bills are pending in the Texas legislature to overturn a significant toxic tort decision made by the state's highest court. In Borg-Warner Corp. v. Arturo Flores, 232 S.W.3d 765 (Tex.2007), the court required plaintiffs to prove they had a sufficient level of exposure to the toxic substance, asbestos.

Earlier in April, a committee of the Texas Senate approved by a 6-2 vote a bill relating to the
standard of causation in claims involving mesothelioma caused by exposure to asbestos
fibers. The bill, S.B. 1123, introduced by Sen. Robert Duncan, R-Lubbock, would require a plaintiff to prove that a defendant ’s product or conduct was a substantial factor in causing the exposed claimant ’s injury by presenting qualitative proof that the asbestos exposure attributed to the defendant was substantial, and not merely de minimis, when considering (1) the frequency of the exposure;  (2) the regularity of the exposure; and (3) the proximity of the claimant to the source of the asbestos fibers.  A plaintiff would not be required to prove numerically the dose, approximate or otherwise, of asbestos fibers to which the claimant was exposed that are attributable to the defendant.

A House bill, introduced by Rep. Craig Eiland, D-Texas City, is still pending in committee. H.B. 1811 would require proof that the defendant ’s product or conduct was a substantial factor in causing the exposed person ’s injury, by showing that the exposure to the asbestos fibers for which that defendant is alleged to be responsible contributed to the cumulative exposure of the exposed person and was more than purely trivial when considering the following (same) qualitative factors: (1) the frequency of exposure; (2) the regularity of exposure; and (3) the proximity of the exposed person to the source of the asbestos fibers. Plaintiff need not prove, for any purpose, a quantitative dose, approximate quantitative dose, or estimated quantitative dose of asbestos fibers to which the exposed person was exposed.

Such language would significantly lower the standard for providing causation in mesothelioma litigation. Perhaps the most widely cited standard for proving causation in asbestos cases is the Lohrmann “frequency, regularity, and proximity” test. Lohrmann v. Pittsburgh Corning Corp., 782 F.2d 1156 (4th Cir.1986). The court there rejected a standard that if the plaintiff can present any evidence that a company's asbestos-containing product was at the workplace while the plaintiff was at the workplace, a jury question has been established as to whether that product proximately caused the plaintiff's disease. Instead, the court concluded that to support a reasonable inference of substantial causation from circumstantial evidence, there must be evidence of exposure to a specific product on a regular basis over some extended period of time in proximity to where the plaintiff actually worked.

While the test seemed to be tighter standard than the plaintiffs’ proposed test, since a plaintiff must prove more than a casual or minimum contact with the product, in reality the test has loosened the traditional standards for substantial factor causation. In Borg-Warner, the court held that a “frequency, regularity, and proximity” test does not, in itself, capture the role of causation as an essential predicate to liability. As in many jurisdictions, the word “substantial” in substantial factor is used to denote the fact that the defendant's conduct has such an effect in producing the harm as to lead reasonable people to regard it as a cause, using that word in the popular sense, in which there always lurks the idea of responsibility, rather than in the so-called philosophic sense, which includes every one of the great number of events without which any happening would not have occurred.

Substantial factor in a toxic tort case cannot be analyzed without recognizing that one of toxicology's central tenets is that “the dose makes the poison.” This notion was first attributed to sixteenth century philosopher-physician Paracelsus, who stated that all substances are poisonous-there is none which is not; the dose differentiates a poison from a remedy. Even water, in sufficient doses, can be toxic. Dose refers to the amount of chemical that enters the body, and, is probably the single most important factor to consider in evaluating whether an alleged exposure caused a specific adverse effect. Not all asbestos exposures cause cancer, and the scientific literature shows that more exposure leads to more disease (dose-response).

Plaintiffs showed nothing about how much asbestos Flores might have inhaled. He was exposed to “some asbestos” on a fairly regular basis for an extended period of time. Nevertheless, absent any evidence of dose, the jury could not evaluate the quantity of respirable asbestos to which Flores might have been exposed or whether those amounts were sufficient to cause his disease. Nor did Flores introduce evidence regarding what percentage of that indeterminate amount may have originated in defendant Borg-Warner products. Plaintiffs did not prove the asbestos content of other brands of brake pads or how much of Flores's exposure came from grinding new pads as opposed to blowing out old ones. Plaintiff need not show dose with mathematical precision.  But in a case like this, proof of mere frequency, regularity, and proximity is necessary but not sufficient, said the court, as it provides none of the quantitative information necessary to support causation under Texas law.
 

The proposed legislation would overturn that clear and compelling logic.

Appeals Court Rejects Bystander Injury Claims

The Sixth Circuit has affirmed the dismissal of claims that a child contracted mesothelioma from exposure to his father's asbestos-laden clothes, finding no evidence that such a “bystander” injury was foreseeable at the time of the alleged exposure. Martin v. Cincinnati Gas and Electric Co., 2009 WL 188051 (6th Cir. 1/27/09).

Claims were brought against the father's old utility company employer and a company that allegedly manufactured asbestos-fireproofing for the utility. The claims were based on asbestos that Martin's father allegedly brought home on his work clothes while working for the utility, CG & E. The district court granted summary judgment for defendants because neither had a legal duty to the plaintiff.

Under applicable Kentucky law, as in most jurisdictions, duty presents a question of law for the judge to decide. Typically, there is a universal duty of care which requires every person to exercise ordinary care in his activities to prevent foreseeable injury. The most important factor in determining whether a duty exists is foreseeability. And foreseeability, in turn, is determined based on what the defendant knew or should have known at the time of the alleged negligence. There was no evidence that either defendant had actual knowledge of the danger of bystander exposure, so the question is whether they should have known: that is, was such a risk foreseeable to them based on “common knowledge at the time and in the community?”

Plaintiff’s expert report did not indicate that the risk was knowable, but in any event, it is insufficient that the danger was merely knowable: the knowledge has to have been available to the defendant. There was an insufficient showing of any general knowledge of bystander exposure in the industry. Plaintiff's expert report concedes that the first studies of bystander exposure were not published until 1965. (Martin's father's exposure to asbestos materials stopped in 1963).

The court rejected the plaintiff’s reliance on several cases from other states where bystander asbestos exposure liability has been upheld; the Sixth Circuit agreed with a number of other cases in which courts have found no duty for secondary asbestos exposure. E.g., CSX Transp. Inc. v. Williams, 608 S.E.2d 208, 210 (Ga. 2005); Adams v. Owens-Illinois Inc., 705 A.2d 58, 66 (Md. Ct. App. 1998); In re Certified Question from Fourteenth Dist. Ct. of Appeals of Tex., 740 N.W.2d at 218-20; In re New York City Asbestos Litig., 840 N.E.2d 115, 121 (N.Y. 2005); and Alcoa Inc. v. Behringer, 235 S.W.3d 456, 462 (Tex. Ct. App. 2007).
 

Summary judgment affirmed.

Supreme Court Agrees To Hear Manville-Related Asbestos Insurance Issues

The U.S. Supreme Court has agreed to review a federal appeals court decision rejecting the resolution of asbestos claims against an insurer, and to decide whether thousands of personal injury plaintiffs may directly sue the insurer. Travelers Indem. Co. v. Bailey, 2008 WL 4106796 (U.S., December 12, 2008).

The case arises from the now-decades old Manville bankruptcy. From the 1920s until the 1970s, Johns-Manville was the largest manufacturer of asbestos-containing products and the largest supplier of raw asbestos in the United States. As a result, in the 1960s and 1970s, Johns-Manville became the target of product liability suits. Johns-Manville filed for Chapter 11 protection under the federal bankruptcy law on Aug. 26, 1982. On that date, Johns-Manville was a defendant in more than 12,500 asbestos-related suits. To fund its reorganization plan, the bankruptcy court allowed Johns-Manville to settle its insurance claims for about $850 million.

Travelers, Johns-Manville's primary insurer from 1947 to 1976, paid about $100 million into the bankruptcy estate in exchange for a full and final release of Manville-related claims. In 1986, Bankruptcy Judge Lifland entered a confirmation order, inter alia barring any person from commencing any actions based upon, arising out of or related to insurance policies that Travelers issued to Manville. In 2004, Judge Lifland found that his injunction was being violated by a new species of asbestos-related lawsuits (referred to by some as “direct action” claims) against insurers. These new asbestos claims were part of a global strategy developed by the plaintiffs' bar to put insurers in Manville's shoes and thereby hold them liable on account of their insurance relationship with Manville.

The Second Circuit, rather than enforce the confirmation order as it was originally written, entered and affirmed on a prior appeal, ruled that Judge Lifland had exceeded the “subject matter jurisdiction” granted by the Judicial Code. In re: Johns-Manville Corp., 517 F.3d 52 (2d Cir. 2008). The Second Circuit concluded that the bankruptcy court in 1986 was without power to enjoin all claims that literally arise out of the insurance policies that Manville purchased from Travelers. Thus, the bankruptcy court had exceeded its authority in approving a multi–million dollar settlement of asbestos–related claims filed against Travelers. The court said the bedrock issue in this case requires a determination as to whether the bankruptcy court had jurisdiction over the disputed statutory and common law claims. While the bankruptcy court repeatedly used the terms “arising out of” and “related to,” global finality for Travelers is only as global as the bankruptcy court's jurisdiction.

Travelers filed a petition for writ of certiorari, as did a group of plaintiff attorneys. Travelers argued that “decades of bankruptcy practice in the lower federal courts” are at risk, and that the Second Circuit opinion is inconsistent with “the carefully crafted legislative scheme Congress constructed.” The plaintiffs petitioner group asserted that the Second Circuit obscured the distinction between jurisdiction and statutory authority and that as a result of the Second Circuit decision, the finality of certain Chapter 11 reorganization plans in federal bankruptcy would be rendered uncertain.

One may wonder whether mass tort reorganization plans might be in jeopardy, under the Second Circuit opinion. Some tens of billions of dollars have been committed to asbestos trusts in cases that relied at least in part on the finality of the Johns-Manville bankruptcy. And the Second Circuit noted that Travelers had alleged that all underlying asbestos settlements were dependent upon the continued validity of the settlement scheme utilized over the past 20 years.

 

State Supreme Court Upholds Asbestos Reform Statute

The Supreme Court of Ohio ruled last week that a 2004 state law imposing limits on asbestos litigation should be applied retroactively. Ackison v. Anchor Packing Co., et al., 2008 WL 4601676 (Ohio Oct. 15, 2008). The ruling could affect the 40,000 claims pending in that state, as well as provide a possible precedent for other states considering the same kind of tort reform.

The 2004 Ohio statute extensively revised state laws governing asbestos litigation and was in response to a legislative finding that the current asbestos personal injury litigation system is unfair and inefficient, imposing a severe burden on litigants and taxpayers alike. The bill established certain threshold requirements, including that no person shall bring or maintain certain kinds of asbestos claims (including claims alleging a nonmalignant condition) without filing with the court certain qualifying medical evidence of physical impairment; further, such evidence must be supported by the written opinion of a competent medical authority stating that the claimant's exposure to asbestos was a substantial contributing factor to his medical condition. The claim of any plaintiff who does not file the required preliminary medical evidence and physician's statement is to be administratively dismissed “without prejudice” with the court retaining jurisdiction, meaning that a plaintiff would not be barred from reinstating the claim in the future when and if the plaintiff could meet the threshold evidentiary requirements.

The court of appeals found the statute could not constitutionally be applied to any suit that had been filed prior to the effective date of the statutory changes, as such plaintiffs had a vested substantive right to pursue recovery for injury under the statutes that were in effect at the time their complaint was filed.

The supreme court disagreed. In this case, the Ohio General Assembly expressly directed that the prima facie filing requirements at issue apply to cases pending on -and thus filed before- the effective date of the legislation. Because the General Assembly so specified, the issue becomes “whether the statute is substantive, rendering it unconstitutionally retroactive, as opposed to merely remedial.” Under Ohio law, and this is fairly  typical, a statute is substantive if it impairs or takes away vested rights, affects an accrued substantive right, imposes new or additional burdens, duties, obligations, or liabilities as to a past transaction, or creates a new right. Conversely, remedial laws are those affecting only the remedy provided, and include laws that merely substitute a new or more appropriate remedy for the enforcement of an existing right.

The court found that the new law is remedial and procedural in nature and, therefore, not unconstitutionally retroactive. The reform established “a procedural prioritization” of asbestos-related cases, a procedure to prioritize the administration and resolution of a cause of action that already exists. No new substantive burdens are placed on claimants.

Clearly, the types of asbestos claims most impacted by the reform statute are the non-malignant claims, short of true asbestosis which is rare anymore, where some radiographic minor finding is alleged to be an injury. While some lower courts in Ohio had stated that pleural plaque or pleural thickening meets the definition of bodily harm which is a subspecies of physical harm and thus satisfies the injury requirements of Sections 388 and 402A of the Restatement of the Law 2d, Torts. E.g., Verbryke v. Owens-Corning Fiberglas Corp., 84 Ohio App.3d 388, 616 N.E.2d 1162 (1992). The supreme court determined that the Maryland court's approach is the better reasoned one: in Owens-Illinois, Inc. v. Armstrong, 87 Md.App. 699, 591 A.2d 544 (Md.App.1991), reversed in part on other grounds 326 Md. 107, 604 A.2d 47 (1992), the Court of Special Appeals of Maryland held that the Restatement did not support the conclusion that pleural plaques and pleural thickening alone were sufficient to constitute harm.

Plaintiffs also attacked the statute’s definition of “competent medical authority” which previously had not been defined by either statute or Ohio case law. By choosing to define that term, said the court, the legislature did not take away Ackison's right to pursue a claim. Nor did the definition alter the quantum of proof necessary for a plaintiff to prevail in an asbestos-related claim. Rather, it merely defined the procedural framework by which trial courts are to adjudicate such claims. The definition of competent medical authority pertains to the witness's competency to testify and is, in essence, more akin to a rule of evidence. As such, it is procedural in nature.
 

Mass Tort Litigation Screenings Exposed

Professor Lester Brickman, of Cardozo School of Law, has published a fascinating article entitled, "The Use of Litigation Screenings in Mass Torts: A Formula for Fraud?"

At MassTortDefense, we would simply remove the question mark.

Plaintiff lawyers obtain the "mass" for some mass tort litigation by conducting screenings to sign-up potential litigants. These "litigation screenings" have no intended medical benefit, and thus this entrepreneurial response to highly profitable opportunities that arise in certain mass tort litigation should not be confused with true medical screening. In a litigation screening, potential litigants are solicited by lawyers or their agents by use of mass mailings, television and newspaper advertisements providing “800” telephone numbers, and by use of web sites purporting to provide medical information about toxic exposures, drugs, devices, or specific diseases but which are, in fact, “fronts” for law firms to whom the web site visitor is referred.

Screenings can be held in motels, shopping center parking lots, local union offices, and even lawyers' offices. There, an occupational history is taken by persons typically with no medical training, a doctor may do a cursory physical exam, and non-doctor technicians administer tests, such as X-rays, pulmonary function tests, echocardiograms and blood tests. The sole purpose of screenings is to generate "medical" evidence of the existence of an injury to be attributed to exposure to or ingestion of defendants' products – all pre-planned. Usually a handful of doctors ("litigation doctors") provide the vast majority of the thousands of medical reports prepared for that litigation.

By the good professor’s count, at least 1,500,000 potential litigants have been screened in the asbestos, silica, fen-phen (diet drugs), silicone breast implant, and welding fume litigation. Litigation doctors found that approximately 1,000,000 of those screened had the requisite condition that could qualify for compensation under plaintiffs’ legal theory, such as asbestosis, silicosis, moderate mitral or mild aortic value regurgitation or a neurological disorder. He further estimates that litigation doctors and screening companies have been paid well in excess of $250 million – huge number, but a tiny fraction of the contingency fees earned well in excess of $13 billion by his estimates.

The professor concludes that approximately 90% claims generated from the screenings were based on "diagnoses" of the type that U.S. District Court Judge Janis Jack, in the silica MDL, found were "manufactured for money."

He also presents the case that bankruptcy courts adjudicating asbestos related bankruptcies have effectively legitimized the use of these litigation screenings.

Professor Brickman's areas of expertise include legal ethics, contingency fees, mass torts, and asbestos litigation. He notes the significant volume of literature about the use of junk science in the court, even today, especially to try to prove general causation in mass torts. But his analysis is particularly valuable because it turns an empirical light on the use of litigation screenings to try to prove specific causation.
 

State Supreme Court Fails To Correct Causation Error in Asbestos Case

Typically, MassTortDefense will post about significant opinions issued on product liability issues. A recent decision, without opinion, by the California Supreme Court is worth a mention. Just recently, the court declined to review the intermediate appellate court’s affirmance of a $3.9 million asbestos verdict. It thus left standing the appellate court’s view on the important issue whether so-called de minimis exposures are sufficient to satisfy the substantial factor test. Norris v. Crane Co., 2008 WL 638361 (Cal.App. 2d Dist. 2008). The California rule raises significant issues for asbestos and potentially other toxic tort defendants, and stands in contrast to the better view in many other jurisdictions.

Background
The plaintiff, former Naval worker Joseph Norris, had been awarded $3.9 million by the jury, 50% liability assigned to defendant Crane Co. The company appealed the verdict, arguing that plaintiff failed to present substantial evidence linking asbestos in the Crane valves to the decedent's mesothelioma. The Second District Court of Appeal disagreed, and affirmed the verdict. On June 25th, the state Supreme Court denied the petition for review.

The court of appeals found sufficient the evidence that the U.S. Navy purchased several types of Crane Co. valves, and that the defendant was aware that parts of these valves would have to be replaced at some point. Norris was allegedly "within a few feet" of other workers who were grinding Crane valves and replacing gaskets on the product. The jury could infer that this process released fibers that contributed to the dust in the air plaintiff breathed as he waited. Also, Norris slept in quarters with two small Crane valves, and when the valves were overhauled, dust was released and was not cleaned up.

Expert testimony was offered to the effect that every exposure to asbestos fibers increased the total dose in his lung that led to the development of his disease. Each dose added more fibers that could stay in the lung. There was substantial evidence plaintiff’s “exposure to asbestos from materials in Crane valves increased his risk of developing mesothelioma and, therefore, was a substantial factor in causing his injury." Thus, the plaintiff successfully proved a causal link between the Crane Co. valves and Norris' mesothelioma, said the court.

 
What’s Wrong With This Picture?
Tort law requires that the allegedly defective product have caused the injury. In the toxic substance context, plaintiff must have been exposed to defendant’s product, and exposed to a sufficient dose that is capable of causing the disease, and actually did cause the disease in plaintiff. Dose refers to the amount of chemical that enters the body, and is arguably the single most important factor to consider in evaluating whether an alleged exposure caused a specific adverse effect. Indeed, a founding principle of toxicology is that the “dose makes the poison.”

The problem with the California opinion is that the plaintiff had improperly been allowed to submit evidence of "any exposure," which rule would allow exposed persons to sue thousands of new defendants whose supposed “contribution” to the disease is trivial at best, and certainly far below the type of doses actually known to cause or increase the risk of disease in any meaningful way.

It is common for plaintiffs to submit expert affidavits attesting that any exposure to asbestos, no matter how minimal, is a substantial contributing factor in asbestos disease. Such generalized opinions ought not suffice to create a jury question in a case where exposure to the defendant's product is de minimis, particularly in the absence of evidence excluding other possible sources of exposure (or in the face of evidence of substantial exposure from other sources). See generally Borg-Warner Corp. v. Flores, 232 S.W.3d 765 (Tex. 2007)(rejecting view that if plaintiff can present any evidence that a company's asbestos-containing product was at the workplace while plaintiff was at the workplace, jury question has been established as to whether that product proximately caused plaintiff's disease).

A far different take on this issue is seen in other jurisdictions. The Pennsylvania Supreme Court, for example, reached conclusions contrary to the California appellate court's ruling in Gregg v. V.J. Auto Parts Inc., 943 A.2d 216, 226-227 (2007). That court concluded that it is not a viable solution to indulge in a fiction that each and every exposure to asbestos, no matter how minimal in relation to other exposures, raises a fact issue concerning substantial-factor causation. The result of that approach would be to subject defendants to full joint-and-several liability for injuries and fatalities in the absence of any reasonably developed scientific reasoning that would support the conclusion that the product sold by the defendant was a substantial factor in causing the harm.

Other courts will thus apply the frequency, regularity, proximity factors in asbestos litigation, Lohrmann v. Pittsburgh Corning Corp., 782 F.2d 1156 (4th Cir.1986), if not as a rigid standard with an absolute threshold necessary to support liability, then at least as an aid in distinguishing cases in which the plaintiff can adduce evidence that there is a sufficiently significant likelihood that the defendant's product caused his harm, from those in which such likelihood is absent on account of only casual or minimal exposure to the defendant's product. The California court missed this opportunity.

(Any readers interested in a copy of the Amicus brief on this issue in the court of appeals can email me and I will send you a copy.)

State Supreme Court Adopts And Applies Forum Non Conveniens

Rhode Island's Supreme Court recently adopted the forum non conveniens doctrine and dismissed multiple asbestos suits filed there by Canadian residents. Kedy v. A.W. Chesterton Co., 946 A.2d 1171 (R.I. 2008).


Rhode Island becomes one of the last states to recognize the doctrine, which is an increasingly important procedural aspect of many mass torts. Large numbers of nonresidents will often file suit in the so-called “magic” jurisdictions -- judicial hellholes for defendants as coined by the American Tort Reform Association -- even though these plaintiffs and the facts of their cases may have no significant relationship with the chosen jurisdiction. The state may be attractive to plaintiffs because of perception of the jury pool, or because of procedural advantages such as when its trial courts employ mass consolidations of multiple individual claims that pressure defendants to settle and limit the ability of courts and defendants to focus on the individual claims. E.g., State ex rel. Mobil Corp. v. Gaughan, 563 S.E.2d 419 (W.Va. 2002). And foreign plaintiffs in general may be attracted to U.S.-style remedies, damages, and procedures.


The forum non conveniens doctrine has been employed by courts to dismiss claims by foreign and out of state plaintiffs in mass torts. The principle allows a court to decline to exercise jurisdiction when the plaintiff's chosen forum is significantly inconvenient and the ends of justice would be better served if the action were brought and tried in another forum. For example, in the In re Vioxx Products Liability Litigation, MDL No. 1657, 2006 WL 2504353 (E.D. La. Aug. 30, 2006), former Vioxx users from 11 foreign countries were dismissed from the MDL. Merck argued that the cases involve the prescription and use of Vioxx in foreign countries, and the drug was distributed under each nation's unique regulatory and legal structure. The plaintiffs were injured abroad and the injury-causing conduct occurred abroad. The foreign courts offered adequate alternative forums; American courts would not have easy access to the foreign documents and witnesses related to the claims. Finally, trying the plaintiffs' claims here in the U.S. risked disrupting the judgments of foreign regulatory bodies by imposing an American jury's view of the appropriate standards of safety and labeling on companies marketing and selling drugs in those nations.


In recent years, tort reform efforts in some states have made an impact on filing of suits by nonresidents that would otherwise swamp their courts. Mississippi has undertaken a series of legislative and judicial reforms to limit the number of out-of-state asbestos claims. For example, the Mississippi Tort Reform Act of 2004 tightened venue provisions and joinder rules and expanded the ability of courts to transfer or dismiss claims under the doctrine of forum non conveniens. Miss. Code Ann. § 11-11-3. As a result of the reforms, the "courts of Mississippi will not become the default forum for plaintiffs seeking to consolidate mass-tort actions." 3M Co. v. Johnson, 926 So. 2d 860, 18–19 (Miss. 2006). Similarly, Texas has expanded the power of courts to dismiss actions on forum non conveniens grounds. See Tex. Civ. Prac. & Rem. Code Ann. § 71.051.

Rhode Island
Several Canadian residents sued in a Rhode Island court, seeking damages for injuries associated with workplace exposure to asbestos in Canada. Several defendants sought dismissal under the doctrine of forum non conveniens. The trial court denied the motion, noting that Rhode Island had not recognized forum non conveniens outside in the tort context, and accepting plaintiffs’ arguments that forum non conveniens has led to confusion and inconsistency in federal and state courts, and that the legislature is the appropriate body to adopt the doctrine.

The state supreme court noted that the doctrine of forum non conveniens is founded in considerations of fundamental fairness and sensible and effective judicial administration. The doctrine has been recognized by common law, statute or rule of civil procedure in most states. Legal commentators are in general agreement that most states follow the federal forum non conveniens test. See Davies, Time to Change the Federal Forum Non Conveniens Analysis, 77 Tul. L.Rev. 309, 315 (2002) (thirty states have “effectively identical” analyses to the federal test, and thirteen other states employ a “very similar” test); Robinson & Speck, Access to State Courts in Transnational Personal Injury Cases: Forum Non Conveniens and Antisuit Injunctions, 68 Tex. L.Rev. 937, 950 (1990) (thirty-two states recognized “something very closely resembling” the federal doctrine, and four other states indicated they would follow the federal doctrine).

The first prong of the forum non conveniens analysis requires a determination of the existence of an available and adequate alternative forum. Second, the court must determine the inconvenience of continuing in the plaintiff's chosen forum by weighing private- and public-interest factors. The private interests of the litigants include the following factors: relative ease of access to sources of proof; availability of compulsory process for attendance of unwilling, and the cost of obtaining attendance of willing, witnesses; possibility of view of premises, if view would be appropriate to the action; and all other practical problems that make trial of a case easy, expeditious and inexpensive. (Citing Gulf Oil Corp., 330 U.S. at 508.)

Other factors that may be relevant to the private-interest assessment include the enforceability of a judgment in the alternative forum, and the advantages and obstacles to a fair trial. A plaintiff may not, by choice of an inconvenient forum, vex, harass, or oppress the defendant by inflicting upon him expense or trouble not necessary to his own right to pursue his remedy. The private interest of a plaintiff should be afforded more weight when the forum choice appears to be based on legally valid reasons such as convenience and expense. Conversely, the private interest of a defendant should be afforded more weight when a plaintiff's choice of forum seems motivated by forum-shopping objectives such as tactical attempts to harness more favorable laws and damages remedies, taking advantage of jurisdictions with generous jury verdicts, or causing inconvenience and expense to a defendant.

Public interest factors include administrative difficulties for courts, that jury duty is a burden that ought not be imposed upon the people of a community which has no relation to the litigation; the local interest in having localized controversies decided at home; and the court in some other forum dealing with problems in conflicts of laws, and in law foreign to itself.

Application of the New Test
Applied here, the court noted that differences in discovery standards are not enough to establish the inadequacy of the forum. Although damages may be smaller in Canada, it was important that neither plaintiffs nor defendants in the underlying cases were residents of Rhode Island or domiciled there. Much of the evidence necessarily is in Canada; the injuries and treatment alleged occurred in Canada, where plaintiffs are residents. No witnesses, workplace sites, or any other relevant evidence appear to be situated in the state. Access to proof is clearly less convenient. Only Canadian courts have the legal power to compel the testimony of Canadian potential witnesses who are not under the control of any party. Furthermore, the likelihood that Canadian law would apply in these cases would place additional burdens upon the state court. Accordingly the foreign claims were dismissed.

Florida Appeals Court Rejects Retroactive Application of Asbestos and Silica Compensation Fairness Act

The Florida court of appeals earlier today rejected retroactive application of the state’s Asbestos and Silica Compensation Fairness Act, finding that the many claimants who filed claims prior to the statute’s enactment need not plead or prove that they developed a malignancy or impairment as a result of their exposure. Williams, et al. v. American Optical Corp., et al., No. 4D07-143 (Fla. Ct. App., 4th DCA, May 28, 2008). 

The decision conflicts with the opinion of another Florida court a few months ago, DaimlerChrysler Corp. v. Hurst, 949 So.2d 279 (Fla. 3d DCA 2007), and is of potential significance because of the wave of reform statutes passed in various states recently in an attempt to bring some fairness and justice to the grandfather of all mass torts, asbestos, and its lurking dust cousin, silica. E.g., Ohio Rev. Code Ann. §§ 2307.71-80; 2307.84-90; 2307.901 (including a requirement that claimants meet certain medical criteria establishing impairment before proceeding with their claims); Kansas (Silica & Asbestos Claims Act, S.B. 512); South Carolina (Asbestos & Silica Claim Procedures Act, S.C. Code Ann. § 44-135-10 et seq.); Tennessee (Silica Compensation Fairness Act, Tenn. Code Ann. § 29-34-301 et seq.).

In the spring of 2005, the Florida Legislature passed the Asbestos and Silica Compensation Fairness Act, which not only requires plaintiffs to show they meet certain medical criteria before proceeding with their claims but also requires that plaintiffs be Florida residents before filing claims in Florida courts. See Fla. Stat. Ann. § 774.201-774.209. The Fourth DCA consolidated several appeals from plaintiffs whose claims were dismissed for not complying with the Act. The issue was stated: Can the Florida Asbestos and Silica Compensation Fairness Act be retroactively applied to prejudice or defeat causes of action already accrued and in litigation? And the court held that the Act cannot constitutionally be so applied.

Asbestos Reform

The long and persistent asbestos litigation led the Florida Legislature to enact the Florida Asbestos and Silica Compensation Fairness Act, which became effective in 2005. The Legislature found that the number of asbestos-related claims has increased significantly in recent years. The true victims of asbestos, the truly injured, were in danger of not receiving compensation, as those who were exposed and could point to some minimal indication of impact without any impairment or disability, soaked up all the resources. The Act made significant changes to the cause of action for damages resulting from an exposure to asbestos. Before the Act was adopted, it was not necessary for any plaintiff to establish that any malignancy or physical impairment had resulted from their exposure and their “asbestosis.” Under the Act, however, a claimant bringing an action for damages from exposure to asbestos must now, as an indispensable element, plead and prove an existing malignancy or actual physical impairment for which asbestos exposure was a substantial contributing factor. Plaintiffs’ asbestosis claims were dismissed for failing to meet these requirements.

Retroactive Analysis

Under Florida’s Constitution, one form of intangible property is a cause of action. This is a right grounded in tort, property or contract law to recover a judgment for money or property from another person whose conduct or activity is deemed by applicable law to have caused the claimant to suffer damage or a loss. Retroactive provisions of a legislative act are invalid when they destroy vested rights. When a cause of action accrues it becomes a substantive vested right. In contrast, said the court, when a right to sue is inchoate, a mere prospect, it is merely an expectation that if another person does someday engage in specific conduct or activity causing some injury, and a specific cause of action has then accrued, the person so aggrieved may then be able to bring an action in court to vindicate the claim in money damages. It is well established that the right to sue on an inchoate cause of action — one that has not yet accrued — is not a vested right because no one has a vested right in the common law.

The question therefore became whether before the statute was enacted Florida law recognized a cause of action for damages arising from the disease of “asbestosis” without any permanent impairment or the presence of cancer. The 4th DCA thought the answer was yes, citing Eagle-Picher Industries Inc. v. Cox, 481 So.2d 517 (Fla. 3d DCA 1985), although that was really a negligent infliction of emotional distress case, and Zell v. Meek, 665 So.2d 1048 (Fla. 1995), although in that case the allegation was of serious lung damage, and Willis v. Gami Golden Glades LLC, 967 So.2d 846 (Fla. 2007), which again seemed to focus on alleged emotional effects from exposures.

The appeals court disagreed, implicitly, with the Legislature’s statement that the Act was intended to simply change the form of asbestos claimants' remedies without impairing their substantive rights. And rejected defendants’ argument that plaintiffs can have no vested right in their claimed cause of action because, in the absence of a true injury in the form of malignancy or impairment, it is a mere expectancy. The right to pursue a cause of action is generally considered to have become vested when the cause of action has accrued. A cause of action accrues when “the last element constituting the cause of action occurs.” § 95.031(1), Fla. Stat. (2007). Constitutionally, a new statute becoming effective after a cause of action has already accrued may not be applied to eliminate or curtail the cause of action. In the appealed cases, plaintiffs alleged a previous exposure to asbestos resulting in what they called the disease of asbestosis, which in turn had manifested itself in some way. Thus, for each, the cause of action had passed from an expectation to the accrual of the right to sue for damages.

Conflict With the 3rd DCA

The opinion attempts to distinguish the decision of the Third District in DaimlerChrysler Corporation v. Hurst, 949 So.2d 279 (Fla. 3d DCA 2007), on the grounds that even under the law existing before the Act the result in Hurst might have been sustained because of the lack of any proof that asbestos was a proximate or even concurring cause of lung cancer. However, the court recognized that in the trial courts in the state, Hurst is being applied to dismiss asbestosis cases like the ones on appeal in which there is no cancer injury or any failure to link asbestos to the injury. Accordingly, the 4th DCA certified that a circuit conflict exists with Hurst to the extent that it does stand for a holding that the Act may be validly applied to asbestosis claimants with accrued causes of action for damages but without permanent impairments or any malignancy.

The 4th DCA did not address in any real depth the reasoning of the 3rd DCA, which noted that the legislature in enacting the Act claimed that the Act does not impair vested rights because the Act expressly preserves the right of all injured persons to recover full compensatory damages for their loss. When the plaintiffs filed their asbestos claims, they were pursuing a common law tort theory. A person has no property, no vested interest, in any rule of the common law. Prior to the enactment of the Act, the plaintiffs had, at most, a “mere expectation” that the common law would not be altered by legislation. See generally Wilson v. AC&S, Inc., 169 Ohio App.3d 720, 864 N.E.2d 682 (Ohio App. 12 Dist. 2006)(retroactive application of Ohio reform statute).



This circuit split means the issue will likely wind up before the Florida Supreme Court at some time.

Severability

Finally, the court noted that after giving the entire text of the Act — especially its preamble of purpose — a careful reading in light of these considerations, it is not intellectually possible to disconnect the several provisions of the Act. Thus, the Act, in its entirety, may not constitutionally be applied to deprive asbestos claimants of an accrued cause of action for damages resulting from exposure to asbestos. Tellingly, the language used by the opinion to describe the legislative purpose betrays the court’s view of the legislation: “whose singular purpose is to end litigation by claimants who have been damaged by asbestos exposure without resulting malignancy or physical impairment.”

What the legislature actually said, was that it wanted to give priority to true victims of asbestos and silica, claimants who can demonstrate actual physical impairment caused by exposure to asbestos or silica, while fully preserving the rights of claimants who were merely exposed to asbestos or silica to pursue compensation if they become impaired in the future as a result of the exposure. The Act would also enhance the ability of the judicial system to supervise and control asbestos and silica litigation; and conserve the scarce resources of the defendants to permit compensation to cancer victims and others who are physically impaired by exposure to asbestos or silica while securing the right to similar compensation for those who may suffer physical impairment in the future.

Nevertheless, the court ruled that plaintiff need only show that they suffered an injury from an asbestos-related, non-malignant disease. The trial court decisions to the contrary were reversed.