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June 28 — Valve manufacturer Crane Co. had a duty to warn of asbestos-containing components in its products produced by another company, the New York Court of Appeals ruled June 28 in two consolidated appeals ( Matter of N.Y.C. Asbestos Litig., 2016 BL 206085, N.Y., Nos. 83, 84, 6/28/16 ).
“This is probably the most significant decision by the Court of Appeals in asbestos litigation” since the 1970s, Dennis Harlow, of Lipsitz & Ponterio in Buffalo, N.Y., told Bloomberg BNA June 28.
Harlow represents the surviving spouse of one of the plaintiffs, Gerald Suttner, a pipefitter who alleged he was exposed to asbestos in third-party gaskets used in Crane valves.
Manufacturers may be in the best position to warn about the dangers of third-party “wear items” integral to their products, the unanimous court said. One factor in the decision was that Crane took “affirmative steps to integrate its valves with third-party asbestos-laden products,” the court said.
“This decision reaffirms that, under New York law, product manufacturers have a responsibility to supply products that are safe for their intended use, and those manufacturers that violate the public’s trust will be held accountable for their actions,” Seth Dymond, of Belluck & Fox in New York City, told Bloomberg BNA June 28 in an e-mail.
Dymond represents the surviving spouse of Ronald Dummitt, a U.S. Navy boiler technician who developed mesothelioma in 2010 and died after a trial of the case.
“We are disappointed by the Court's ruling, which is in conflict with those made by courts in other states as well as on the federal level addressing ‘duty to warn' standards for equipment manufacturers who did not make asbestos products,” Crane Co. said in a statement.
“[T]he Court adopted a new test that considers ‘economic necessity' in determining a manufacturer's duty to warn about the potential hazards of third party products used in combination with its own product. This new test will now have to be interpreted and applied by the lower courts in New York,” the company said.
The decision affirmed rulings for the plaintiffs by the New York Appellate Division, and it continues a recent trend in which courts have rejected arguments by manufacturers that they are absolved of liability for another company's asbestos-laden replacement part.
“This is a highly respected court with a long history of asbestos litigation, so I believe it is likely to be more persuasive,” plaintiffs' lawyer Jonathan Ruckdeschel, of the Ruckdeschel Law Firm in Ellicott City, Md., told Bloomberg BNA June 28.
Ruckdeschel, who isn't involved in the litigation, focuses on asbestos cases in his practice.
“This decision yet again confirms that the law requires companies to warn users of the hazards of their products,” Ruckdeschel said.
“This is an argument that we’ve made all along, and perhaps the ‘bare metal defense' used by manufacturers has finally run its course,” he said.
That defense, also known as the component parts defense, generally limits a manufacturer's liability to its product, not to asbestos in third-party components used in a product.
The ruling is in accord with recent decisions rejecting the defense—including Maryland and South Carolina—but departs from California and Washington courts, which have declined to do so (30 TXLR 193, 2/26/15).
Like the decision here, the Maryland Court of Appeals ruled in May v. Air & Liquid Sys. Corp., 129 A.3d 984 (Md. 2015), that a duty to warn was triggered because the asbestos-containing parts were required to make pumps in that case function properly (30 TXLR 1218, 12/31/15).
Last year, the U.S. District Court for the District of South Carolina was persuaded by an intervening state court decision that the bare metal defense wasn't a part of South Carolina law (30 TXLR 193, 2/26/15).
More recently, the California Supreme Court ruled that while manufacturers may still invoke the component parts doctrine as a defense, it didn't bar a sick employee from suing a company that supplied raw materials to his employer (31 TXLR 612, 6/30/16).
Dummitt worked with Crane valves from 1960 to 1977, and a jury found Crane 99 percent liable for his illness, awarding him $32 million in damages, according to the decision.
Crane challenged the verdict, along with jury instructions on liability, and the parties stipulated to reduced damages of $5.5 million for past pain and suffering and $2.5 million for future pain and suffering, the court said.
But the New York Appellate Division upheld the trial court's judgment that Crane had a duty to warn Dummitt of asbestos in the third-party replacement gaskets used in its valves.
The Appellate Division also upheld a verdict for Suttner in which a jury awarded him $3 million in damages, setting up the appeals here.
When a manufacturer's durable product—such a high-pressure valve made by Crane—is designed to be used with a fungible replacement part made by another company, that rightly places the duty to warn on the durable good manufacturer, the court said.
It noted that the durable product manufacturer “typically is in the best position to guarantee that those who use the two products together will receive a warning,” and that consumers are more likely to interact with the durable product over an extended period of time.
“Accordingly, we recognize a manufacturer's duty to warn of the peril of a known and foreseeable joint use of its product and another product that is necessary to allow the manufacturer's product to work as intended,” the court said.
Judge Michael Garcia concurred in the judgment, but said the majority opinion “opens too broad an avenue for potential liability.”
The standard should “focus on the affirmative action taken by the manufacturer in placing the harmful product containing asbestos into the stream of commerce,” Garcia said.
Judge Sheila Abdus-Salaam wrote the opinion, joined by Judges Eugene F. Piggott Jr., Jenny Rivera, Leslie E. Stein, Eugene M. Fahey and Michael Garcia.
Judge Garcia filed a separate concurring opinion.
Chief Judge Janet DiFiore did not take part in the appeals.
To contact the reporter on this story: Steven M. Sellers in Washington at email@example.com.
The opinion is available at http://www.bloomberglaw.com/public/document/Matter_of_NYC_Asbestos_Litig_No_83_2016_BL_206085_NY_June_28_2016
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