Component Parts Supplier Case to Watch

The California Supreme Court has agreed to review a lower appeals court's ruling on the application of the component parts doctrine in a metal worker's suit claiming lung  injury. See Ramos, et al. v. Brenntag Specialties Inc., et al., No. B248038 (Cal. review granted 7/9/14).

In Ramos v. Brenntag Specialties, Inc. , 224 Cal.App.4th 123, the court had disagreed with the well-reasoned opinion in Maxton v. Western States Metals, 203 Cal.App.4th 81 (2012). 

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. Product components include raw materials, bulk products, and other constituent products sold for integration into other products. The products at issue in these cases clearly are mere 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. 

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 or users far exceeds any additional protection provided. 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.

In Ramos, a different lower appellate court rejected the argument that raw material suppliers are not liable for injuries caused by finished products that use those raw materials. Hopefully, the California Supreme Court will clarify.

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. 

 

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.”
 
 
 
 

 

State Appeals Court Finds Personal Jurisdiction Over Foreign Part Maker

An Illinois appeals court recently held that Illinois courts may exercise jurisdiction over a French manufacturer of helicopter parts. Russell v. SNFA, No. 1-09-3012 (Ill. App. Ct.,  3/31/11).  The court reversed the trial court's decision to dismiss the case for lack of personal jurisdiction.

Readers know that the issues of personal jurisdiction over foreign product manufacturers is currently pending before the U.S. Supreme Court as we have posted before. This case underscores the importance of Supreme Court guidance in this area.

Plaintiff’s brother died during a helicopter crash in Illinois. He was the pilot and sole occupant, and was working for Air Angels, a medical air service that did business primarily in Illinois and, in particular, Cook County.  Defendant SNFA, a French company, made a part for that helicopter, which plaintiff claims was defective and the cause of the crash. Specifically, plaintiff alleged that the crash was caused by  the failure of one of the helicopter’s tail-rotor drive-shaft bearings, which defendant manufactured. Plaintiff alleged that, as a result of this failure, the drive shaft fractured, leaving the tail rotor inoperable; and the helicopter spun out of control.

Defendant moved to dismiss on the ground that Illinois had no jurisdiction over it.  Illinois has a jurisdictional statute, like many states, with a catchall provision which permits Illinois courts to exercise jurisdiction on any other basis now or hereafter permitted by the Illinois Constitution
and the Constitution of the United States. This permits an Illinois court to exercise personal jurisdiction to the extent permitted by the due process clause of the 14th Amendment to the United States Constitution.

General jurisdiction exists when defendant’s general business contacts with the forum state are continuous and systematic. Specific jurisdiction exists when the cause of action arose out of defendant’s contacts with the forum state.  Here, the court of appeals found that the state court had specific jurisdiction over defendant.  One relevant factor is whether the litigation results from alleged injuries that arise out of or relate to the defendant's activities in the state or directed to the state. For a tort action, the state in which the injury occurs is often considered to be the state in which the tort occurred. In the case at bar, the injury occurred in Illinois, and thus Illinois was deemed the state in which this tort occurred.  Numerous prior cases had noted that tortfeasors must expect to be haled into Illinois courts for torts where the injury took place there.

The court of appeals was also persuaded by the fact that the defendant was the same, and indeed many of the facts alleged the same, as in Rockwell International Corp. v. Costruzioni Aeronautiche Giovanni Agusta, S.P.A., 553 F.Supp. 328 (E.D. Pa. 1982).  The federal court there had held that the forum state, which was the site of the crash, could exercise specific personal jurisdiction over defendant SNFA. In both cases defendant had allegedly custom-made bearings for an A-109 helicopter; a subsequent owner replaced the tail-rotor drive-shaft bearings, with ones also manufactured by defendant. In both cases plaintiff alleged that the bearings and the drive shaft
failed, causing the helicopter to crash.

The Illinois court also determined that a relevant sale occurred in the state, despite the fact that the defendant sold the parts outside the U.S. It found that the cause of action could be traced from the sale of the ball bearings by SNFA, through its chain of distribution, to the apparent malfunction that allegedly caused the helicopter to crash. As a result, the court concluded that the “sale, malfunction and injury all occurred within” the forum state.

Defendant argued against minimum contacts claiming that its sales of ball bearings to the helicopter-maker Agusta were confined to Europe and that a court should not blur the distinction between Agusta.  But the court stressed that because the ball bearings were custom-made, SNFA intended its products to be an inseparable part of the marketing plan of Agusta.  That is, the bearing was uniquely designed for incorporation into Agusta’s helicopter, and SNFA had to
distribute its product through Agusta’s distributions system.  Agusta provided defendant with precise specifications, and defendant manufactured the bearings according to those specifications. Defendant acknowledged that it knows that its custom-made tail-rotor bearings are
incorporated by Agusta into helicopters and also sold as individual replacement parts.

SNFA did not deny that it knew that Agusta helicopters were sold throughout the United States, and that Agusta had an American subsidiary for the purpose of American distribution. Given the distribution system, SNFA had ample reason to know, said the court, and expect, that its bearing, as a unique part of a larger product, would be marketed in any or all states, including the forum state. By virtue of having a component specifically designed for the Agusta helicopter, SNFA had a "stake in" and expected to derive definite benefit from sales of the Agusta A-109 (and replacement parts) in the United States.

In essence, Agusta was the marketer and distributor to the consumer of their joint and ultimate product. SNFA has chosen to leave to Agusta the marketing and distribution to the consumer. Agusta was thus called the conduit through which this SNFA product, custom-made for Agusta, reached the ultimate consumers.

Finally, because the court found that SNFA designed and manufactured a component that was incorporated into a product which was intended to be, and was in fact, sold in the United States, it also concluded that where that component allegedly fails and causes injury in the very market in which the product was expected to be sold, it is not unreasonable or unfair to require the defendant to be subject to suit in that forum.

In one respect, this case does not present the most aggressive application of specific jurisdiction, in that the facts suggest something beyond mere stream of commerce jurisdiction, something more than just plain having sold a product that found its way into the forum.  But of great concern for foreign manufacturers would be the analysis of the nationwide distribution scheme, and the notion that by selling a part to a customer that has a national distribution system, a manufacturer thereby exposes itself to tort suits everywhere in the U.S.

 


 

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.