Wednesday, November 17, 2010
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Court of Appeals Upholds $7 Million Judgment in Asbestos Case
Div. Five Rejects ‘Sophisticated Purchaser’ Defense Advanced by Union Carbide
By KENNETH OFGANG, Staff Writer
A plumber who developed cancer as a result of exposure to asbestos cannot be denied recovery from the manufacturer on the ground that the company that purchased the product knew of the dangers, the Court of Appeal for this district ruled yesterday.
Div. Five affirmed a judgment of more than $7.2 million in favor of Larry R. Stewart and his wife. In doing so, it rejected Union Carbide Corporation’s assertion of the “sophisticated purchaser doctrine,” the court holding the defense did not apply when the plaintiff was not the purchaser and had no reason to know of the dangers likely to result as a result of using the product.
Stewart testified that he worked in plumbing from 1968 until being diagnosed with mesothelioma in 2007. He worked on large projects and was apparently exposed to asbestos contained in joint compound used by drywallers, who put up walls as soon as the plumbers finished their work.
‘Dust Everywhere’
Sanding by drywallers, Stewart explained, created a dust that formed a white cloud that filled several rooms at a time. The dust would then be stirred into the air by laborers, who would come in to sweep, creating “a total mess” with “dust everywhere” Stewart said.
It was impossible to avoid breathing the dust, he said, but he was not concerned about his health at the time because he assumed that the commercial availability of the product meant it was safe. There were no warnings on the boxes containing the compound—which contained Calidria, the brand name for asbestos sold by Union Carbide—and there was never any verbal warning given, at safety meetings that were regularly held or otherwise, he explained.
Experts testified that Stewart had been exposed to substantial amounts of asbestos and had fibers in his lungs that would not be found in the general population. One expert opined that a person exposed to the dust Stewart described was at risk of developing cancer even if the person was merely a bystander.
Plaintiffs’ Verdict
Jurors found for the plaintiffs on theories of negligence and strict liability, both for failure to warn and design defect. They attributed 85 percent of the fault to Union Carbide and 15 percent to other tortfeasors, all of whom settled before the verdict.
Jurors awarded Stewart $2.2 million in economic damages, $500,000 in non-economic damages, and $6 million in punitive damages, and awarded his wife $500,000 in non-economic damages. After applying credits for prior settlements, the court entered judgment for $417,625 in economic, $425,000 in non-economic, and $6 million in punitive damages in favor of Stewart and for $425,000 in favor of his wife.
Justice Orville Armstrong, writing for the Court of Appeal, said Los Angeles Superior Court Judge Alan Rosenfield correctly denied a proposed jury instruction on the sophisticated purchaser defense.
Proposed Instruction
Union Carbide asked that jurors be told that “where the risk of using a hazardous product is already known, or should be known, by the purchaser of that product, the product supplier has no duty to warn of the product’s potential hazards,” that a bulk supplier’s or raw materials supplier’s duty to warn “is measured by what is generally known or should be known to purchasers of the raw product, rather than by the individual plaintiff’s subjective knowledge,” and that “the sale of a raw material to a sophisticated intermediary purchaser who knew or should have known of the risks of that raw material cannot be the legal cause of any harm the raw material may cause.”
The proposed instruction was wrong, Armstrong said, because the doctrine does not impute the sophisticated purchaser’s knowledge to an injured consumer or bystander whom the purchaser supposedly should have warned, but didn’t.
Nor, the justice said, could Union Carbide have relied on the “sophisticated intermediary” doctrine, since there was no evidence in this case that Union Carbide warned the purchasers of any danger.
Armstrong went on to say that the punitive damage award was supported by substantial evidence that Union Carbide knew of the dangers of asbestos long before workers became aware.
He cited testimony that Hamilton Materials, the manufacturer of the compound to which Stewart was exposed, had questioned the safety of Calidria but was told it was “no big deal;” that it told customers in the early 1970s that Calidria was or might be safer than other forms of asbestos, even though internal memos showed it did not really believe that.
The justice also cited a 1972 memo by a company marketing manager, outlining a strategy for “forcefully” persuading customers who raised the issue that the product was safe, while avoiding specifics, in the face of new federal regulations.
The case was argued in the Court of Appeal by Daniel Gonzalez of Horvitz & Levy for Union Carbide and by Anthony Vieira of Paul & Hanley for the plaintiffs.
The case is Stewart v. Union Carbide Corporation, B216193.
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