Is the MDL a “sophisticated misuser” of California law? California appellate court refuses to apply sophisticated user doctrine, rebukes Feds

A California appellate court has refused to apply the sophisticated user doctrine to bar the claims of the family of a career U.S. Navy shipyard worker who worked with asbestos-containing equipment at Navy shipyards between 1957 and 1989.  In Gottschall v. Crane Co., No. A136516 (First Appellate District, October 8, 2014), the First District reasserted the view that the sophisticated user defense under California law, is limited to situations where the end-user/plaintiff is knowledgeable does not apply where it is the purchaser/employer that is “sophisticated.”

The issue in Gottschall came up in a roundabout manner.  The plaintiff filed two wrongful death cases:  one in San Francisco Superior Court, which named the defendant and appellee Crane Co., and one in the U.S. District Court for the Northern District of California, naming six different defendants.  While Crane Co. continued to litigate in San Francisco, the federal case was subsequently transferred to the Eastern District of Pennsylvania, which was assigned to handle multidistrict asbestos litigation.  On December 8, 2011, the MDL (Robreno, J.)  granted a summary judgment motion filed by defendant General Dynamics Corp., holding that the U.S. Navy was a sophisticated user under California law, and therefore the plaintiffs could not maintain a claim.

Crane Co. filed its own summary judgment motion in San Francisco Superior Court predicated on this ruling, and arguing that the doctrine of collateral estoppel compelled the same result.   The court agreed, applied collateral estoppel and granted the motion.

The Court of Appeal reversed. First, it refused to apply the doctrine of collateral estoppel, finding that the sophisticated user issue was a “pure question of law,” and cited Jenkins v. County of Riverside (2006) 138 Cal.App.4th 593, 618 for the premise that collateral estoppel should not be applied in a way that prevents a California court from making a “proper interpretation” of its own law.  Then, in a stunning rebuke of the federal court, the Court of Appeal found that the MDL court’s “application of California law was wrong, as any reading of the evolution of California’s sophisticated user defense demonstrates.”

Gottschall distinguished the seminal case of Johnson v. American Standard, Inc. (2008)43 Cal.4th 56, on the ground  that the case involved a certified HVAC technician whose training and experience made him a sophisticated user, capable of understanding the hazards of the products with which he worked.  Then, the Court of Appeal relied on Stewart v. Union Carbide Corp. (2010) 190 Cal.App.4th 23 (2010) and Pfeifer v. John Crane, Inc. (2013) 220 Cal.App.4th 1270, both of which turned on the sophistication of the user – the individual using the products – and not the employer.  Thus, the First District stated plainly that “the Pennsylvania federal court was wrong in ruling as it did. Necessarily, the San Francisco Superior Court was wrong in holding that appellants were collaterally estopped by the Pennsylvania federal court’s decision.”

Though Johnson was initially received with much fanfare by the defense bar, Gottschall is only the latest in a string of decisions significantly limiting Johnson’s application.  While Gottschall classifies this as an “evolution of California’s sophisticated user defense,” the reality may be that the appellate courts, not the MDL, are the “sophisticated misusers” of Johnson’s holding.

Though Johnson did decide the issue of the application of the defense to a specific HVAC contractor, the decision makes clear that the point of the doctrine is to protect the manufacturer from the need to warn a sophisticated purchaser, and cites with approval Fierro v. International Harvester Co. (1982) 127 Cal.App.3d 862 and In re Related Asbestos Cases (N.D.Cal. 1982) 543 F.Supp. 1142, 1151.  Indeed, in In Re Asbestos, the court noted that “the Navy, as an employer, was aware of the dangers of asbestos as were defendants and that the Navy nonetheless misused the products, thereby absolving defendants of liability for failure to warn the Navy’s employees of the product dangers” (emphasis added).  The Supreme Court may yet get involved to clarify its application of Johnson.

MDL Court Rules That Work on Two Pumps Not a Substantial Factor

Substantial factor?  I know it when I see it.

Many of us have struggled for quite some time in reaching a consensus on what level of exposure does, and does not, constitute a “substantial factor” when assessing causation of an asbestos-related disease.  In a recent order on a motion for summary judgment, Judge Eduardo Robreno of the asbestos MDL, applying maritime law, weighed in on the issue.  His decision gives additional guidance, if it does not end the discussion.

The case involved a former U.S. Navy sailor who testified to exposure to original asbestos-containing gaskets and packing used with two pumps found on the virtually new USS Downes.  Even while accepting that evidence as accurate, Judge Robreno granted the MSJ by determining this was a “mere minimal exposure” as described in Lindstrom v. A-C Prod. Liab. Trust, 424 F. 3d 488 at 492. Judge Robreno stated:

Although there is evidence that Plaintiff was exposed to respirable dust from the original gasket and packing used with a single Buffalo electric fire pump, and the original gasket used with a single Buffalo evaporator pump —-, maritime law requires more than a “mere minimal exposure” to support a finding of causation. (Citation omitted.)  As such, no reasonable jury could conclude from the evidence that Decedent was exposed to asbestos from a product manufactured and/or supplied by Defendant such that it was a substantial factor in the development of his illness.

Other courts have likewise relied upon Lindstrom to reject claims that minimal exposures constituted a substantial factor.  The Sixth Circuit expressed the sentiment memorably in Moeller v. Garlock Sealing Technologies, 660 F.3d 950 at 955 (6th Cir. 2011):

On the basis of the record, saying that exposure to Garlock gaskets was a substantial cause of [plaintiff’s] mesothelioma would be akin to saying that one who pours a bucket of water into the ocean has substantially contributed to the ocean’s volume.

From a defense prospective, this order from Judge Robreno compares favorably with other attempts to define a substantial factor.  In California, for example, we must deal with the language of Jones v. John Crane, Inc., 35 Cal. Rptr. 3d 144 (2005).  In Jones, John Crane argued that the exposures attributable to its products were comparable to ambient levels of asbestos in the community at large, and paled in comparison to the plaintiffs’ other exposures (10 fiber hours, or .005 fiber years, compared to an estimated 200 fiber years of exposure to asbestos-containing insulation and 2.8 fiber years from ambient exposures). Plaintiff experts challenged the defense calculations and offered expert testimony that every exposure contributed to the risk.  The court ruled against the defense: “[A] level of exposure that is the equivalent of that to which one might be exposed in the ambient air over a lifetime is not necessarily insignificant.”

While the order from Judge Robreno gives us at least one example of what does not constitute a substantial factor, it provides scant guidance as to how to assess future cases.  Nevertheless, at least when maritime law is applied, it is reassuring to know that there are some acknowledged exposure scenarios that do not qualify as substantial factors.