Toxic Tort Alert
In a decision likely to disappoint many defendants involved in
the California asbestos litigation, California's Second
Appellate District upheld a trial court decision in which the trial
judge refused to instruct the jury under a "sophisticated
purchaser defense."
Stewart vs. Union Carbide Corp., No. B216193 (2nd App. Dist.
Nov. 16, 2010)
Plaintiff was employed as a plumber from the late 1960s until he
developed mesothelioma in 2007. While working on various commercial
and residential construction jobs, the plumber often worked near
the drywallers who were installing drywall and using joint
compound. The joint compound, which contained asbestos at certain
times, was manufactured by USG and Hamilton Materials. The plumber
presented evidence that USG and Hamilton Materials obtained the raw
asbestos from Union Carbide Corp.
According to the plumber, the drywallers followed the plumbers on
any given job. Drywallers would install the drywall, tape the
joints, put joint compound over the tape and then sand the joint
compound. Significant amounts of dust were created during the
sanding phase. Laborers would later sweep up the area, thereby
stirring the dust up again. The plumber testified that "there
was no way to avoid breathing this dust."
During the closing at trial, the plumber's counsel argued that
Union Carbide failed to meet its burden of proof and that there was
a complete lack of evidence that the other entities listed on the
special verdict form were at fault. Union Carbide objected to the
plumber's counsel's comment in that it implied that Union
Carbide had the burden of proving specific fault percentages. It
asked the court to instruct the jury accordingly. The court
refused.
A directed verdict was entered in favor of Union Carbide on the
fraud count. However, the jury found in favor of the plumber and
against Union Carbide on all causes of action for negligence and
strict products liability on both failure to warn and design
defect/consumer expectations theories. Although 47 entities were
named in the action, the jury allocated 85 percent of the fault in
the case to Union Carbide and 15 percent to Hamilton Materials;
there was no fault allocation to the other entities. A multiple
seven-figure verdict was rendered against Union Carbide.
On appeal, Union Carbide argued that the trial court improperly
refused to instruct the jury on the "sophisticated purchaser
defense." In particular, Union Carbide wanted the jury to hear
and be instructed on the following: "Where the risk of using a
hazardous product is already known, or should be known, by the
purchaser of that product, the product supplier has no duty to warn
of the product's potential hazards; that a bulk supplier's
or raw materials supplier's duty to warn is measured by what is
generally known or should be known to purchasers of the raw
product, rather than by the individual plaintiff's knowledge;
and that the sale of a raw material to a sophisticated intermediary
purchaser who knew or should have known of the risks of that raw
material cannot be the legal cause of any harm the raw material may
cause."
Union Carbide cited Johnson vs. American Standard, Inc.,
43 Cal. 4th 56 (2008), in support of its position on appeal. In
Johnson, plaintiff was a certified air conditioning repair
technician who was injured on the job while he was repairing an air
conditioner that lacked a warning of a dangerous condition which
could occur during repair. Johnson stands for the
proposition that manufacturers have a duty to warn consumers about
the hazards inherent in their products, but that there is an
exception to the rule that "sophisticated users need not be
warned about dangers of which they are already aware or should be
aware."
Distinguishing Johnson, the Stewart court
clarified that Johnson "did not impute an
intermediary's knowledge to the plaintiff, or charge him with
any knowledge except that which had been made available to him
through his training and which, by reason of his profession and
certification." The court criticized Union Carbide's
position because the plumber had not obtained any knowledge of the
dangers associated with asbestos and had no obligation to do so.
Johnson also did not stand for the principle that since
Union Carbide's customers (Hamilton Materials and USG) knew or
should have known of the dangers of asbestos, Union Carbide did not
have to warn the plumber. The court stated, "[a]s we have
seen, however, Johnson was not concerned with the
knowledge of the purchaser, but with the knowledge of the
user." Further, "the employer-employee relationship is
different than the relationship between a sophisticated user
intermediary and an unknown number of non-employees who may at some
point work with the sophisticated user's product."
The Stewart decision will be disconcerting to many because
the court has limited the application of the sophisticated user
doctrine to instances where the actual user knew or had
reason to know of the product's dangers. It also seems to limit
the application of the bulk supplier and component part defenses.
Finally, the decision seems to unfairly imply that the
"defendant" has the burden of proof to provide specific
percentages of fault in order to reduce its own liability in the
case. That has never been the law in California.
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