March 22, 2019
The United States Supreme Court, by a 6-3 vote, held in Air and Liquid Systems v. DeVries, that product manufacturers can be held liable under maritime law for asbestos components that they did not manufacture or supply, but which were applied to their products after sale.
In this matter, John B. DeVries and Kenneth McAfee served aboard several vessels in the United States Navy in the 1950s, 1960s, 1970s and 1980s, and alleged that they ere exposed to asbestos associated with various ship-board products. They subsequently developed cancer, which they attributed to this asbestos exposure and separately brought suit in state court in Pennsylvania against several manufacturers of products that they encountered in their Navy service. Various defendants removed the cases to Federal Court, in the Eastern District of Pennsylvania, because the cases arose from injuries that allegedly occurred aboard vessels on navigable waters and because defendants stated a colorable federal common-law defense to claims arising from their conduct as contractors for the United States Navy.
The defendants manufactured various products, including pumps, turbines, and generators. The defendants moved for summary judgment on the grounds that they had no duty to warn plaintiffs of potential health hazards associated with asbestos because they supplied “bare metal” products, or products which did not contain the asbestos insulation plaintiffs associated with their products. After purchasing the products, the Navy applied asbestos-containing components manufactured by other companies, many of whom are now bankrupt. Plaintiffs claimed that defendant manufacturers negligently failed to warn them of the dangers of asbestos in the integrated products. The Court of Appeals for the Third Circuit held that a manufacturer of a bare metal product may be held liable for a plaintiff’s injuries suffered from later-added asbestos-containing materials if the manufacturer could foresee that the product would be used with the later-added asbestos-containing materials and did not provide a warning.
Justice Brett Kavanagh writing for the Supreme Court affirmed, but found that the Third Circuit’s “foreseeability rule” was too broad and would impose a difficult and costly burden on manufacturers while over warning users. This foreseeability rule would impose liability even if the
manufacturer’s product did not require that the asbestos component be used. The Court recognized that many products could be used foreseeably in many ways with numerous other products and parts. To require product manufacturers to warn about all foreseeable uses and potential components would impose an undue burden. At the same time, the Court rejected defendants’ proposal to adopt a “bare metal” rule, based on whether the product manufacturer itself manufactured, sold, or distributed the asbestos-containing component into the integrated product. The Court found this rule was too narrow in cases where the product requires incorporation of a part that the manufacturer knows or has reason to know is likely to make the product more dangerous for its intended uses.
The Court chartered a third course, relying on several decisions from other jurisdictions, including the New York Court of Appeals decision in In re New York City Asbestos Litigation (“Dummitt”) , 27 N.Y.3d 765 (2016) (finding that product manufacturers have a “duty to warn of the danger arising from the known and reasonably foreseeable use of its product in combination with a third-party product which, as a matter of design, mechanics or economic necessity, is necessary to enable the manufacturer’s product to function as intended”). In order to find a product manufacturer liable for the asbestos containing component part, that component has to be required for the product to function as intended. The Court determined that the product manufacturer is often in a better position that the component part manufacturer to provide a warning concerning the integrated product. Thus, under federal maritime law, a product manufacturer “has a duty to warn when (i) its product requires incorporation of a part, (ii) the manufacturer knows or has reason to know that the integrated product is likely to be dangerous for its intended uses, and (iii) the manufacturer has no reason to believe that the product’s users will realize that danger.”
While placing limits on the extent of a product manufacturer’s duty, and claiming that its decision is based on maritime law’s special solicitude for sailors, the Court also cites decisions by lower courts which suggests a more expansive duty. The Court says its decision encompasses situations which suggests liability can be extended where “the product in effect requires the part in order for the integrated product to function as intended.”
Justice Neil Gorsuch filed a dissenting opinion, joined by Justices Thomas and Alito. In their view, the duty to warn “is restricted to warnings based on the characteristics of the manufacturer’s own product. ” Here, defendants sold “bare metal” products and someone else later chose to add asbestos insulation to them. It is black letter law that the actual manufacturer of the asbestos-containing component part had a legal duty to provide a warning. Requiring the product manufacturer to warn of these potential component parts would leave manufacturers unsure about their legal duties and liabilities.
In summary, for cases arising under federal maritime law the Supreme Court’s opinion may permit product manufacturers to be held liable for component parts they did not manufacture or supply. The Court’s decision rejected a rule based on mere foreseeability, but it is nonetheless an extension of liability for product manufacturers.