The Supreme Court of the United States granted a petition for certiorari this week in an asbestos case which may directly impact the ability of equipment manufacturers to assert the “bare metal” defense. Where applicable, the bare metal defense generally exempts manufacturers from liability for injuries caused by parts or components they did not manufacture, distribute, or sell. The case, Air and Liquid Systems Corp. et al. v. Devries et al., arose out of the Third Circuit,1 and deals with allegations of asbestos exposures aboard U.S. Navy vessels and in shipyards.
Although this specific case deals with maritime law, it is likely that the decision of the Supreme Court of the United States will eventually affect the ability of manufacturer defendants to assert the defense in cases not governed by maritime law.
The Underlying Cases
In the underlying cases, two widows alleged that their husbands developed asbestos-related diseases from exposures to asbestos that occurred while the men served in the U.S. Navy and in a shipyard. The estates for the men alleged the plaintiffs worked around asbestos-containing insulation, gaskets, and packing which had been incorporated into other equipment, such as pumps and valves. The estates alleged claims sounding in negligence and strict liability.
Various equipment manufacturers moved for summary judgment, arguing that the products they sold to the Navy (e.g. compressors, condensers, steam traps, pumps, engines, etc.) consisted of “bare metal” and that when these products left their control they were without any asbestos-containing component parts. The equipment manufacturers argued that they could not be held liable for any injuries allegedly caused by the asbestos-containing insulation, gaskets, and/or packing products which were manufactured by third parties and later added to their respective equipment. The district court agreed and granted the dispositive motions.
Bright-Line vs. Fact-Specific “Bare Metal” Tests
The plaintiffs appealed to the Third Circuit, which remanded the case for clarification of the appropriate standard to use: the “bright-line” test or “fact-specific” test. The bright-line test holds that a manufacturer can never be liable for the asbestos-containing parts added to its products by a third party, whereas the fact-specific test may allow liability if the facts show that the plaintiff’s injuries were a reasonably foreseeable result of the manufacturer’s failure to provide a reasonable and adequate warning. On remand, the district court applied a bright-line test, rather than a fact-specific standard, and determined that the bare metal defense barred all negligence and strict liability claims under maritime law because the subject products were not insulated. The plaintiffs appealed again.
On appeal for the second time, the Third Circuit determined that the unique characteristics of maritime law—including a desire for uniformity and promotion of sailor safety—required the adoption of the fact-specific inquiry, rather than the bright-line test. The Third Circuit determined that a manufacturer may be subject to liability if at the time it placed its product into the stream of commerce it reasonably could have known that:
Asbestos was hazardous; and
Its product would be used with an asbestos-containing part, because
The product was originally equipped with an asbestos-containing part that could reasonably be expected to be replaced over the product’s lifetime;
The manufacturer specifically directed that the product be used with an asbestos-containing part; or
The part required an asbestos-containing part to function properly.
The Third Circuit emphasized that the above facts were not the only ones under which liability could arise, and that the finer contours of the defense, as applied to various factual scenarios, would need to be decided on a case-by-case basis. The decision of the Third Circuit is expressly limited in application to cases that arise under maritime law.
The manufacturers sought to appeal this ruling by petitioning for certiorari to the Supreme Court of the United States. This petition was granted on May 14, 2018.
Possibility of Broader Impact
The bare metal defense is frequently asserted by equipment manufacturer defendants in asbestos litigation, who argue they should not be held liable for injuries allegedly caused by exposure to asbestos-containing components manufactured by third parties. These manufacturers assert it is improper to hold them liable for alleged injuries caused by asbestos-containing products they neither manufactured, distributed, nor sold. As recognized by the Third Circuit in Devries, courts in different jurisdictions have offered various tests or requirements in order for the bare metal defense to apply. Indeed, it is likely the split in authority that caused the Supreme Court to grant the petition for certiorari.
Although the decision of the Third Circuit to apply the “fact-specific” bare metal defense rather than the “bright-line” test is expressly limited in application to cases that arise under maritime law, it is likely that the decision of the Supreme Court will filter down to negligence and strict liability asbestos personal injury claims brought under state law. Depending on its outcome, it is likely that parties in asbestos litigation will seek to expand the application of this decision in future asbestos cases or, conversely, will seek to limit its application based on the fact that the decision arose under maritime law which includes particular areas of emphasis that may not be applicable in non-maritime cases. Finally, given the split of state and circuit authority on this issue, it is possible, but not likely, that the Supreme Court could offer a wider-ranging opinion that would not be limited in direct application to maritime cases. In that event, manufacturing defendants involved in asbestos litigation would need to re-evaluate the litigation landscape and the future viability of the bare metal defense.
The Asbestos Litigation Defense Group at HAWS-KM will continue to monitor this matter as it develops. If you have any questions regarding this content, please contact the author at (651) 227-9411.
