Product Liability and the Duty to Warn (And More)

In an asbestos case, a balancing test should have been used to determine whether manufacturers “had a duty to warn about the post-sale integration of asbestos-containing products manufactured and sold by others.” Further, expert testimony regarding the effects of asbestos exposure on a plaintiff did not have to be based on “firsthand knowledge.”

Coffman v. Armstrong International, Inc., No. E2017-01985-COA-R3-CV, No. E2017-02389-COA-R3-CV, No. E2017-00062-COA-R3-CV through E2017-00067-COA-R3-CV, No. E2017-00069-COA-R3-CV, No. E2017-00071-COA-R3-CV, No. E2017-00075-COA-R3-CV, No. E2017-00078-COA-R3-CV, No. E2017-00995-COA-R3-CV (Tenn. Ct. App. July 22, 2019), was a very long, detailed opinion regarding asbestos-related products liability claims made by plaintiff against many defendants. The trial court had granted summary judgment to defendants on all claims based on a four-year statute of repose, a ten-year statute of repose, and plaintiff’s failure to show causation, but the Court of Appeals vacated the judgments, finding that there were genuine issues of material fact as to all plaintiff’s claims.

Plaintiff had worked at Eastman chemical plant from 1968 until 1997, where he worked with equipment that carried acid from other parts of the plant. Part of his job was to “repair equipment on a daily basis.” During his time at Eastman, plaintiff alleged that he was exposed to asbestos in three ways: 1) by breathing in asbestos dust due to his need to remove asbestos insulation in order to replace or repair various “pumps, valves and pipes,” and by breathing in asbestos dust due to the replacement, removal and installation of insulation in his building every day; 2) by breathing in asbestos dust “created by the removal of asbestos-containing gaskets manufactured by [three defendants];” and 3) by breathing in asbestos dust “created by the removal of asbestos-containing packing manufactured by John Crane, Inc.” Plaintiff was ultimately diagnosed with mesothelioma, and he filed this products liability suit against an independent contractor who removed and installed asbestos insulation, John Crane (the manufacturer of asbestos-containing packing), and a group of manufacturers of various industrial products such as valves and pumps.

The Court of Appeals first analyzed the claims against the independent contractor who performed “periodic removal and installation of insulation” at Eastman. The trial court granted summary judgment to this defendant based on the four-year statute of repose found in Tennessee’s construction statute, Tenn. Code Ann. § 28-3-202, as the work was undisputedly stopped in 1990. This construction statute of repose covers claims related to the “construction of an improvement to real property,” but plaintiff “insisted that [defendant’s] daily removal and installation of insulation was not construction of an improvement to real property,” and the Court of Appeals agreed. The Court noted that “Tennessee law recognizes a distinction between improvements to real property and mere repairs or replacement,” but that no Tennessee case had addressed which category the “daily removal and installation of insulation at an industrial facility” would fall under. (internal citation omitted). The Court ultimately ruled that while the “initial installation of insulation into a building or house may be considered an improvement to real property if it is intended to be a permanent feature of the property,” the kind of daily removal and installation at play in this case “over the course of many years indicates that existing insulation is merely being repaired and replaced,” and the construction statute of repose does not apply. (internal citation and quotation omitted). Summary judgment on this claim was thus vacated.

The Court of Appeals next looked at the claims against the various equipment manufacturers. These defendants all produced equipment such as valves and pumps that were sold to Eastman and integrated into Eastman’s existing system. The trial court granted summary judgment to a group of these defendants based on the ten-year statute of repose contained in the products liability act, but the Court of Appeals overturned.

When the Tennessee Products Liability Act was passed in 1978, it contained a ten-year statute of repose stating that claims “must be brought within ten years from the date on which the product was first purchased for use or consumption.” The next year, the Tennessee legislature added an exception to this statute of repose for asbestos-related claims, but the exception could not be applied retroactively. Thus, even for asbestos-related claims, if the product was sold before July 1, 1969, a products liability claim is time-barred. The Court looked at the three companies to whom summary judgment was granted on this basis, and it found that there were issues of fact as to whether each one had sold or supplied products to Eastman after July 1969. The Court relied on plaintiff’s deposition, as well as testimony from an Eastman employee who stated that Eastman tried to keep very low inventory on hand, and summary judgment based on this statute of repose was overturned.

Next, the Court analyzed summary judgment based on the finding that none of the equipment-manufacturing defendants had a duty to warn in this case, which applied to “plaintiff’s claims arising from the post-sale integration of asbestos-containing [equipment] manufactured and sold by others.” Plaintiff was essentially arguing that the equipment defendants knew that to use the parts they sold, workers would have to integrate asbestos-containing parts or otherwise come into contact with asbestos. The trial court had “ruled that the equipment defendants negated their alleged duty to warn about the post-sale integration of asbestos-containing [equipment] manufactured and sold by others” because they demonstrated that Tennessee is a “bare metal defense” jurisdiction. In a bare metal defense state, “if a manufacturer did not itself make, sell or distribute the part into the product, the manufacturer is not liable for harm caused by the integrated product—even if the product required incorporation of the part and the manufacturer knew that the integrated product was likely to be dangerous for its intended uses.” (internal citations and quotations omitted). The Court of Appeals disagreed with this ruling.

The Court noted that there were “no Tennessee cases that speak to the question of whether suppliers of industrial equipment have a duty to warn about dangers associated with the post-sale integration of dangerous component parts manufactured and supplied by others,” and it ultimately settled on applying a balancing approach laid out in Satterfield v. Breeding Insulation Company, 266 S.W.3d 347 (Tenn. 2008). For this particular case, the Court ruled that the danger of exposure to people like plaintiff was reasonably foreseeable and found:

In the present case, it was extremely foreseeable that asbestos-containing insulation, flange gaskets, replacement internal gaskets, and replacement packing would be applied to the defendants’ equipment post-sale. The Supreme Court has also noted that asbestos is an extremely dangerous substances… Given the highly hazardous nature of asbestos and the dire consequences to the unwarned consumer, the possible magnitude of potential harm was great. In our view, the degree of foreseeable harm and the gravity of potential harm outweighed the burden that the equipment defendants would have suffered by warning about the post-sale integration of asbestos-containing [equipment]. Accordingly, the equipment defendants did have a duty to warn about the dangers associated with those later-added products.

(internal citations and quotations omitted). Accordingly, summary judgment based on there being no duty to warn was vacated.

Finally, the Court analyzed the trial court’s grant of summary judgment to several defendants based on the finding that plaintiff presented insufficient causation evidence. First, the Court looked at cause in fact. Regarding the asbestos packing material, the Court found that the plaintiff’s testimony about what the material looked like combined with testimony from a corporate representative that most of their customers bought the cheaper, asbestos-containing product was sufficient as to the claim against that company. Regarding the equipment defendants, the Court held plaintiff had presented facts from which a jury could find that his prolonged exposure to the equipment at issue was a cause-in-fact of his disease.

Regarding proximate cause, the trial court had excluded testimony from plaintiff’s two experts because the relevant testimony was produced in supplemental affidavits. The Court of Appeals overturned this exclusion, finding that the experts were initially disclosed within the time limit agreed upon, that plaintiff was under a duty to supplement expert testimony as necessary, and that the supplemental testimony was provided long before the hearing on the summary judgment motions. With the expert testimony admissible, plaintiff had presented enough evidence to create a question of fact as to proximate causation.

This opinion is long, detailed and quite fact-specific. If you are litigating an asbestos-related products liability case, though, it is an important read, and it could potentially have applicability in other products liability cases where parts are added to a product post-sale, thus making the product dangerous.

NOTE:  to aid lawyers in giving clients guidance about how long it takes to receive an opinion after oral argument in the appellate courts, we are going to start sharing that information with readers.   Please understand that the length of time that elapses between oral argument and the date the opinion is released is dependent on a multitude of factors, not the least of which is the complexity of the issues presented.  In this case, the opinion was released 6.5 months after oral argument.

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