Amicus Curiae Brief — Air & Liquid Systems Corp. v. DeVries, 139 S. Ct. 986 (2019) (No. 17-1104)

No. 17-1104

In the Supreme Court of the Anited States

AIR AND LIQUID SYSTEMS CORP., ET AL.,

Petitioners,

Vv.

ROBERTA G. DEVRIES, ADMINISTRATRIX OF THE ESTATE OF

JOHN B. DEVRIES, DECEASED, ET AL.,

Respondents.

On Writ of Certiorari to the United States Court of

Appeals for the Third Circuit

AMICI CURIAE BRIEF OF COALITION FOR

LITIGATION JUSTICE, INC., AMERICAN INSUR-

ANCE ASSOCIATION, AMERICAN TORT REFORM

ASSOCIATION, AND NFIB SMALL BUSINESS

LEGAL CENTER IN SUPPORT OF PETITIONERS

Mark A. Behrens

Counsel of Record

SHOOK, HARDY & BACON L.L.P.

1155 F Street, NW, Suite 200

Washington, DC 20004

(202) 783-8400

mbehrens@shb.com

July 16, 2018

(Additional Counsel Listed on Inside Cover)

Additional Counsel for Amici Curiae

Christopher E. Appel

SHOOK, HARDY & BACON L.L.P.

1155 F Street, NW, Suite 200

Washington, DC 20004

(202) 783-8400

Of Counsel

Kenneth Stoller

AMERICAN INSURANCE ASSOCIATION

555 12th Street, NW, Suite 550

Washington, DC 20004

(202) 828-7100

Karen R. Harned

Elizabeth Milito

NFIB SMALL BUSINESS LEGAL CENTER

1201 F Street, NW, Suite 200

Washington, DC 20004

(202) 314-2061

H. Sherman Joyce

Lauren S. Jarrell

AMERICAN TORT REFORM ASSOCIATION

1101 Connecticut Avenue, NW, Suite 400

Washington, DC 20036

QUESTION PRESENTED

Can products-liability defendants be held liable

under Maritime law for injuries caused by products

that they did not make, sell, or distribute?

TABLE OF CONTENTS

Page

QUESTION PRESENTED ..........0............--2.-2eeeeeees i

ee ee I tricccccrcscccencncnsccsccnancnenccsse ii

TABLE OF AUTHORITIES .....................c2cceeeee000s iil

INTEREST OF AMICI CURIAE........................--- |

INTRODUCTION AND

SUMMARY OF THE ARGUMENT ................. 3

iene tinidireeiisiaidiinbemmnacnanennee 7

[. TRADITIONAL TORT LAW

PRINCIPLES DO NOT SUPPORT

IMPOSITION OF LIABILITY FOR

HARMS CAUSED BY THIRD-PARTIES... 7

Il. A DUTY TO WARN OF RISKS IN

OTHERS’ PRODUCTS IS UNSOUND

A. A DUTY RULE WOULD LEAD TO A FLOOD

OF NEW ASBESTOS CASES, UNDULY

PRESSURE REMAINING DEFENDANTS,

AND FUEL THE SEARCH FOR “SOLVENT

le ER NT 16

B. NON-ASBESTOS MARITIME TORT CASES

_ «ERE CN Se 19

C. THE DUTY WOULD BE ENDLESS AND

nn ccsenans 20

D. OVER-WARNING COULD UNDERMINE

COORG GLAD TITY «.....cccecccccceccccsccocescccesss 21

Ill. ASBESTOS TRUSTS PROVIDE AN

ALTERNATIVE COMPENSATION

SYSTEM FOR HARMS CAUSED BY

BANKRUPT FORMER ASBESTOS

i iciinsitinistssecnevianchausvsdscdcesscesssoanies

inci cicsctecicssnnasinicniceconenninisiniionsitnisivainens

iV

TABLE OF AUTHORITIES

Cases Page

Acoba v. Gen. Tire, Inc., 986 P.2d 288

a etcsmssanioiacs 14

Amchem Prods. Inc. v. Windsor, 521 U.S. 591

EES ona a Keen ens Savers rel tee 4

Bartel v. John Crane, Inc., 316 F. Supp. 2d 603

(N.D. Ohio 2004), affd sub nom. Lindstrom v.

A-C Prod. Liab. Trust, 424 F.3d 488 (6th Cir.

SUI iiisrideices lain tatetiiatininnddesaubberdibccmlalaheaenancasbian 3

Baughman v. General Motors Corp., 780 F.2d 1131

ELE Ce er 13, 14

Boyd v. Warren Pumps, LLC, 654 F. App’x 875

ENE a REE vere er ee ER 9

Braaten v. Saberhagen Holdings, 198 P.3d 493

i ccmseunseuneness 10, 11-12

Brown v. Drake-Willock Int'l, Lid.,

530 N.W.2d 510 (Mich. App. 1995) ..................... 12

Cabasug v. Crane Co., 989 F. Supp. 2d 1027

chalice ciclincaheninciesthdalasithicestatideinplenniinnaniensepini 9

Childress v. Gresen Mfg. Co., 888 F.2d 45

ERE Ses eae 13

Cousineau v. Ford Motor Co., 363 N.W.2d 721

Ke 14

Crews v. Air & Liquid Sys. Corp., 2014 WL

639685 (N.D.N.Y. Feb. 18, 2014)........................... 9

Dalton v. 3M Co., 2013 WL 4886658 (D. Del. Sept.

12, 2013), report and recommendation adopted,

2013 WL 5486813 (D. Del. Oct. 1, 2013)........ 10-11

Dreyer v. Exel Indus., S.A., 326 F. App’x 353

er I ticisccininticiiasisiihiadibbiieeietsibdliialiaiinettniinses 13

Firestone Steel Prods. Co. v. Barajas,

927 S.W.2d 608 (Tex. 1996)...................00...cceccee 14

Fleck v. KDI Sylvan Pools, 981 F.2d 107

IEE TUITE dctnccnsctsatncedationdichacedbassaiidebussininiasecenciben 14

Ford Motor Co. v. Wood, 703 A.2d 1315

(Md. Ct. Spec. App. 1998), abrogated on

other grounds, John Crane, Inc. v.

Scribner, 800 A.2d 727 (Md. 2002)...................... 15

Grant v. Foster Wheeler, LLC, 140 A.3d 1242

GEESE TRS MER SI OPT aD Sr Rie EU 10

Harris v. Ajax Boiler, Inc., 2014 WL 3101941

Se ts NE i Se i adaciccscpennccnteartotiocienieestents 13

Horne v. Owens-Corning Fiberglas Corp.,

4 F.3d 376 (4th Cir. 1008) ........00.0...00000.00000022...... 22

Huck v. Wyeth, Inc., 850 N.W.2d 353 (lowa 2014)... 11

In re Deep Vein Thrombosis, 356 F. Supp. 2d 1055

Ak 8 FES aera eee 12

In re Garlock Sealing Technologies, LLC,

504 B.R. 71 (W.D.N.C. Bankr. 2014) ............ 18, 26

In re Joint E. & S. Dists. Asbestos Litig.,

237 F. Supp. 2d 297 (E. & S.D.N.Y. 2002).......... 22

Lindstrom v. A-C Prod. Liab. Trust,

424 F.3d 488 (6th Cir. 2005) ..............0....0....000000--- 8

Lytell v. Goodyear Tire & Rubber Co.,

439 So. 2d 542 (La. Ct. App. 1983)...................... 14

Matter of New York City Asbestos Litig.

(Dummitt v. Crane Co.) and Matter of

Eighth Jud. Dist. Asbestos Litig. (Suttner

v. Crane Co.), 59 N.E.3d 458 (N.Y. 2016) ........... 15

May v. Air & Liquid Sys. Corp., 129 A.3d 984

EE A 15

MclIndoe v. Huntington Ingalls Inc., 817 F.3d 1170

nr 9

McNair v. Johnson & Johnson, 2018 WL 2186550

See |

Mitchell v. Sky Climber, Inc., 487 N.E.2d 1374

EE ee 12

Morgan v. Bill Vann Co., Inc., 969 F. Supp. 2d 1358

Re ERE a a 10

Moss v. Trane U.S., Inc., 2016 WL 916435

I Es GD BN MII i crnnccncccnsscstnsessssosccasceces 10

Nelson v. Air & Liquid Sys. Corp., 2014 WL

6982476 (W.D. Wash. Dec. 9, 2014)...................... i)

Oneal v. Alfa Laval, Inc., 2014 WL 5341878

a cccesmeneunponsonese 9

O'Neil v. Crane Co., 266 P.3d 987

ENE a 9, 11, 21

Ortiz v. Fibreboard Corp., 527 U.S. 815 (1999) ....... 4

Rastelli v. Goodyear Tire & Rubber Co.,

i 15

Reynolds v. Bridgestone/Firestone, Inc.,

989 F.2d 465 (11th Cir. 1993).............................. 14

Robinson v. Flowserve, 2015 WL 11622965

en 10

Rockman v. Union Carbide Corp., 266 F. Supp. 3d

839 (D. Md. 2017), appeal dismissed sub nom.

Rockman v. Georgia-Pacific, LLC, 2017 W1.

7135451 (4th Cir. Oct. 23, 2017) ......0000000c cece. 3

Sanders v. Ingram Equip., Inc., 531 So. 2d 879

EEE TE Ra: SN eer A ae 13

Shaw v. Gen. Motors Corp., 727 P.2d 387

EEE Se 12-13

Simonetta v. Viad Corp., 197 P.3d 127

ERC aE OF ee a RSE 10, 12

Spencer v. Ford Motor Co., 367 N.W.2d 393

Is a eeetbiacini 14

Stallings v. Georgia-Pacific Corp., 2015 WL.

7258518 (W.D. Ky. Nov. 17, 2015) .............0000000.... 9

Stark v. Armstrong World Indus., Inc.,

21 F. App’x 371 (6th Cir. 2001)... 3)

Straley v. United States, 887 F. Supp. 728

I I ca 21

Taylor v. Elliott Turbomachinery Co., Inc.,

90 Cal. Rptr. 3d 414 (Ct. App. 2009)............. 20, 22

Thing v. La Chusa, 48 Cal. 3d 644 (1989)... 7

Toole v. Georgia-Pacific, LLC, 2011 WL. 7938847

Ry i 10

Toth v. Econ. Forms Corp., 571 A.2d 420

SE eee 13

Vedros v. Northrop Grumman Shipbuilding, Inc.,

2014 WL 1093678 (E.D. La. Mar. 14, 2014)......... 9

Walton v. Harnischfeger, 796 S.W.2d 225

RSS SESE een ee 13

vill

Westchem Agric. Chems. v. Ford Motor Co.,

990 F.2d 426 (8th Cir. 1993) .....................000.cc0e. 12

Whiting v. CBS Corp., 982 N.E.2d 1224 (Table)

I I, a ssiseueiapueabinses 10

Wiler v. Firestone Tire & Rubber Co.,

96 Cal. App. 3d G21 (1979) .................................. 14

Zambrana v. Standard Oil Co. of Cal.,

ee cesuisemonninenin 14

Statutes and Regulations

GS a a 23

TEL OTS aT 22

Other Authorities

63A Am. Jur. 2d Products Liability § 1027 ................ 8

American Academy of Actuaries’ Mass Torts Sub-

committee, Overview of Asbestos Claims Issues

and Trends (Aug. 2007), available at https://

www.actuary.org/pdf/casualty/asbestos _

Mark A. Behrens & Margaret Horn, Liability for

Asbestos-Containing Connected or Replace-

ment Parts Made by Third Parties: Courts Are

Properly Rejecting this Form of Guilt by Asso-

ciation, 37 Am. J. Trial Advoc. 489 (2014).......... 11

Jenni Biggs et al., A Synthesis of Asbestos Disclo-

sures from Form 10-Ks — Updated (Towers

Watson June 2013), available at https://

www.towerswatson.com/en-US/Insights/

Newsletters/Americas/americas-insights/20 | 3/

A-Synthesis-of-Asbestos-Disclosures-From-

Form-10-Ks-Updated ................0.....0-0c0-000-- 5, 18, 19

Lester Brickman, Fraud and Abuse in Mesothelioma

Litigation, 88 Tul. L. Rev. 1071 (2014)............... 26

S. Todd Brown, Bankruptcy Trusts, Transparency

and the Future of Asbestos Compensation,

23 Widener L.J. 299 (2013) ...................... 17-18, 25

S. Todd Brown, Specious Claims and Global

Settlements, 42 U. Mem. L. Rev. 559 (2012)....... 15

Steven J. Carroll et al., Asbestos Litigation (RAND

Corp. 2005), available at https://www.rand.org/

content/dam/rand/pubs/monographs/2005/

George Scott Christian & Dale Craymer, Texas

Asbestos Litigation Reform: A Model for the

States, 44 S. Tex. L. Rev. 981 (2003)................... 21

Deposition of Jared Garelick, in Cummings v.

General Elec., No. 13-C1-006374 (Jefferson

MR een 26

Lloyd Dixon & Geoffrey McGovern, Asbestos Bank-

ruptcy Trusts and Tort Compensation (Rand

Corp. 2011), available at https://www.rand.org/

content/dam/rand/pubs/monographs/

2011/RAND_MG1104.pdf........2......0......eeecceeeceeee 23

Lloyd Dixon & Geoffrey McGovern, Bankruptcy’s

Effect on Product Identification in Asbestos

Personal Injury Cases (RAND Corp. 2015)

available at https://www.rand.org/content/

dam/rand/pubs/research_reports/RR90/

RR907/RAND_RR907.pdf.......................000c00000000- 27

Lloyd Dixon et al., Asbestos Bankruptcy Trusts:

An Overview of Trust Structure and Activity

with Detailed Reports on the Largest Trusts

(Rand Corp. 2010), available at https://www.

rand.org/content/dam/rand/pubs/

technical_reports/2010/RAND_TR872.pdf.......... 23

Christopher Edley, Jr. & Paul C. Weiler,

Asbestos: A Multi-Billion-Dollar Crisis,

30 Harv. J. on Legis. 383 (1993) ......................... 19

Peter Geier, Asbestos Litigation Moves On With

World War II Shipyard Cases ‘Dying Off,

Plaintiff Attorneys Dig Deeper to Find New

Strategies, 130:5 Recorder (San Francisco)

Patrick M. Hanlon & Anne Smetak, Asbestos

Changes, 62 N.Y.U. Ann. Surv. Am. L. 525

John J. Hare & Daniel J. Ryan, Uncloaking

Bankruptcy Trust Filings in Asbestos Litiga-

15-9 Mealey’s Asb. Bankr. Rep. 1 (2015)............ 24

James A. Henderson, Jr., Sellers of Safe Products

Should Not Be Required to Rescue Users from

Risks Presented by Other, More Dangerous

Products, 37 Sw. U. L. Rev. 595 (2008).............. 7-8

xi

Michael Hoenig, Commentary, No Liability for

Another's Asbestos Products, N.Y.L.d., Feb. 17,

Joseph W. Hovermill et al., Targeting of

Manufacturers, 47 No. 10 DRI For Def. 52

James S. Kakalik et al., Costs of Asbestos Litigation

(RAND Corp. 1983), available at https://

www.rand.org/pubs/reports/R3042.html .............. 3

Adrienne Bramlett Kvello, The Best of Times

and the Worst of Times: How Borg-Warner

and Bankruptcy Trusts Are Changing Asbes-

tos Settlements in Texas, 40 The Advoc. (Tex.)

Manville Personal Injury Settlement Trust 2002

TDP Proof of Claim Form, http://

www.claimsres.com/wp-content/uploads/20 16/

LU/POCOBV 4. pdf .............ccc-cececcececoceececeseeserereesess 25

‘Medical Monitoring and Asbestos Litigation’—A

Discussion with Richard Scruggs and Victor

Schwartz, 17-3 Mealey’s Litig. Rep.: Asb. 19

Mark D. Plevin et al., Where Are They Now,

Part Six: An Update on Developments in

Asbestos-Related Bankruptcy Cases, 11-7

Mealey’s Asb. Bankr. Rep. 1 (Feb. 2012).............. 4

Paul Riehle et al., Product Liability for Third

Party Replacement or Connected Parts:

Changing Tides From the West, 44 U.S.F.

xii

Eduardo C. Robreno, The Federal Asbestos

Product Liability Multidistrict Litigation

(MDL-875): Black Hole or New Paradigm?,

23 Widener Ld. 97 (2O13) .......... ccc cccccccceceeeeeeeeeee 16

Marc C. Scarcella & Peter R. Kelso, A Reorganized

Mess: The Current State of the Asbestos Bank-

ruptcy Trust System, 14-7 Mealey’s Asb. Bankr.

ER a SE aS See ee 24

Marc C. Scarcella et al., The Philadelphia Story:

Asbestos Litigation, Bankruptcy Trusts and

Changes in Exposure Allegations From 1991-

2010, 27-3 Mealey’s Litig. Rep.: Asb. 1

ENS EE aE CR 4

Victor E. Schwartz, A Letter to the Nation’s Trial

Judges: Asbestos Litigation, Major Progress

Made Over the Past Decade and Hurdles You

Can Vault in the Next, 36 Am. J. of Trial Advoc.

SPR Freie Sra Re na 6

Victor E. Schwartz & Russell W. Driver,

Warnings in the Workplace: The Need for a

Synthesis of Law and Communication

Theory, 52 U. Cin. L. Rev. 38 (1983)................... 21

Dionne Searcy & Rob Barry, As Asbestos Claims

Rise, So Do Worries About Fraud, Wall St. J.,

Mar. 11, 2013, at Al, available at https://

www.wsj.com/articles/SB 1000 1424 1278873238

6430457831861 1662911912 00000 eee 25

William P. Shelley et al., The Need for Further

Transparency Between the Tort System and

Section 524(g) Asbestos Trusts, 2014 Update -

Judicial and Legislative Developments and

Other Changes in the Landscape Since 2008,

23 Widener Lid. 675 (2014) .00000.. oc occccccccccccccceeeee 23

xi

James Stengel, The Asbestos End-Game,

62 N.Y.U. Ann. Surv. Am. L. 223 (2006) ........ 3, 19

Mary Elizabeth Stern & Lucy P. Allen, Resolution

Values Dropped 35% While Filings and Indem-

nity Payments Continued at Historical Levels

(NERA Econ. Consulting June 2016), available

at http://www.nera.com/content/dam/nera/

publications/2017/PUB_Asbestos _

Litigation_Trends_0217.pdf................................ 18

Joseph E. Stiglitz et al., The Impact of Asbestos

Liabilities on Workers in Bankrupt Firms,

12 J. Bankr. L. & Prac. 51 (2003) ....................... 19

U.S. Gov't Accountability Office, GAO-11-819,

Asbestos Injury Compensation: The Role and

Administration of Asbestos Trusts (Sept. 2011),

available at https://www.gao.gov/assets/590/

IITs cinsictiscitaietietinaiinemeienenieiian 23, 25, 26, 27

Thomas M. Wilson, /nstitutionalized Fraud in

Asbestos Bankruptcy Trusts, 29-7 Mealey’s

Fe EE 8 a 24

INTEREST OF AMICI CURIAE'

The Coalition for Litigation Justice, Inc., Ameri-

can Insurance Association, American Tort Reform

Association, and NFIB Small Business Legal Center

are organizations whose members include companies

that manufactured or sold various products used in

conjunction with asbestos-containing products and

insurers of those companies.

Amici are concerned that if the Court holds prod-

uct manufacturers liable for harms caused by other

manufacturers’ asbestos-containing products, the de-

cision will unduly pressure the remaining solvent de-

fendants in the asbestos litigation, including small

businesses. The four decades old asbestos litigation

has already bankrupted over 120 companies and

shows no sign of abating. A duty finding would also

open the door to lawsuits against countless compa-

nies whose products are used with other potentially

hazardous products sold by third parties. Finally,

other courts may be guided by the Court’s decision

when deciding similar cases under state common

law.

The Coalition for Litigation Justice, Inc. is a non-

profit association formed by insurers in 2000 to ad-

dress and improve the asbestos litigation environ-

' No counsel for a party authored this brief in whole or in part;

and no party, party's counsel, or other person or entity—other

than the amici or their counsel—contributed money that was

intended to fund preparing or submitting the brief. The parties

have consented to the filing of the brief.

ment. The Coalition has filed over 100 amicus curi-

ae briefs in cases that may have a significant impact

on the asbestos litigation environment.

The American Insurance Association (“AIA”),

founded in 1866 as the National Board of Fire Un-

derwriters, is a leading national trade association

representing approximately 340 major property and

casualty insurance companies. AIA members collec-

tively underwrite more than $134 billion in direct

property and casualty premiums nationwide, and

range in size from small companies to the largest in-

surers with global operations. AIA files amicus curi-

ae briefs in significant cases on issues of importance

to the insurance industry and marketplace.

Founded in 1986, the American Tort Reform As-

sociation (““ATRA”) is a broad-based coalition of busi-

nesses, corporations, municipalities, associations,

and professional firms that have pooled their re-

sources to promote reform of the civil justice system

with the goal of ensuring fairness, balance, and pre-

dictability in civil litigation. For over three decades,

ATRA has filed amicus curiae briefs in cases before

state and federal courts that have addressed im-

portant liability issues.

The NFIB Small Business Legal Center, a non-

profit, public interest law firm established to protect

the rights of America’s small-business owners, is the

legal arm of the National Federation of Independent

2 The Coalition includes Century Indemnity Company; San

Francisco Reinsurance Company; Great American Insurance

Company; Nationwide Indemnity Company; Resolute Manage-

ment Inc., a third-party administrator for numerous insurers;

and TIG Insurance Company.

Business (““NFIB”). NFIB is the nation’s oldest and

largest organization dedicated to representing the

interests of small-business owners throughout all fif-

ty states. The approximately 350,000 members of

NFIB own a wide variety of America’s independent

businesses.

INTRODUCTION AND

SUMMARY OF THE ARGUMENT

Originally and for many years, the primary de-

fendants in asbestos cases were companies that

mined asbestos or manufactured friable, amphibole-

containing thermal insulation. See James S. Kakalik

et al., Costs of Asbestos Litigation 3 (RAND Corp.

1983). Hundreds of thousands of claims were filed

against the major asbestos producers, such as Johns-

Manville Corp, Owens Corning Corp., and W.R.

Grace & Co.

3 See Bartel v. John Crane, Inc., 316 F. Supp. 2d 603, 605 (N.D.

Ohio 2004) (‘While there is debate in the medical community

over whether chrysotile asbestos is carcinogenic, it is generally

accepted that it takes a far greater exposure to chrysotile fibers

than to amphibole fibers to cause mesothelioma.”), affd sub

nom. Lindstrom v. A-C Prod. Liab. Trust, 424 F.3d 488 (6th Cir.

2005); Rockman v. Union Carbide Corp., 266 F. Supp. 3d 839,

846 (D. Md. 2017) (‘chrysotile asbestos is classified in an entire-

ly separate mineralogical family from amphibole asbestos and

is widely considered less potent.”), appeal dismissed sub nom.

Rockman v. Georgia-Pacific, LLC, 2017 WL 7135451 (4th Cir.

Oct. 23, 2017).

4 See James Stengel, The Asbestos End-Game, 62 N.Y.U. Ann.

Surv. Am. L. 223, 237 (2006) (“As leading plaintiffs’ counsel Ron

Motley and Joe Rice observed some time ago, the first seven-

teen asbestos defendants to go into bankruptcy represented

‘one-half to three-quarters of the original liability share.”). Ac-

cording to RAND, “[a]pproximately 730,000 people had filed an

asbestos claim through 2002.” Steven J. Carroll et al, Asbestos

By the late 1990s, the asbestos litigation had

reached such proportions that this Court noted the

“elephantine mass” of cases, Ortiz v. Fibreboard

Corp., 527 U.S. 815, 821 (1999), and referred to the

litigation as a “crisis.” Amchem Prods. Inc. v. Wind-

sor, 521 U.S. 591, 597 (1997). Mass filings pressured

“most of the lead defendants and scores of other com-

panies” into bankruptcy, including virtually all manu-

facturers of asbestos-containing thermal insulation.

Steven J. Carroll et al., Asbestos Litigation 67 (RAND

Corp. 2005).

Following a 2000-2002 wave of bankruptcies

among asbestos manufacturers,° “plaintiffs’ attorneys

shifted their litigation strategy away from the tradi-

tional thermal insulation defendants and towards

peripheral and new defendants....”. Marc C. Scarcel-

la et al., The Philadelphia Story: Asbestos Litigation,

Bankruptcy Trusts and Changes in Exposure Allega-

tions From 1991-2010, 27-3 Mealey’s Litig. Rep.: Asb.

1, 1 (Nov. 7, 2012); Carroll et al., supra, at xxiii

(plaintiffs began to “press peripheral non-bankrupt

defendants to shoulder a larger share of the value of

asbestos claims and to widen their search for other

corporations that might be held liable for the costs of

asbestos exposure and disease.”).6 The litigation be-

Litigation xxiv (RAND Corp. 2005). Tens of thousands of addi-

tional claims have been filed since 2002.

5 See Mark D. Plevin et al., Where Are They Now, Part Six An

Update on Developments in Asbestos-Related Bankruptcy Cases,

11-7 Mealey’s Asb. Bankr. Rep. 1, Chart 1 (Feb. 2012) (there

were as many asbestos-related bankruptcies from 2000-2002 as

in the previous two decades combined).

6 See also Patrick M. Hanlon & Anne Smetak, Asbestos Chang-

es, 62 N.Y.U. Ann. Surv. Am. L. 525, 556 (2007) (the “surge of

came an “endless search for a solvent bystander,” ac-

cording to one plaintiffs attorney. ‘Medical Monitor-

ing and Asbestos Litigation’-A Discussion with Rich-

ard Scruggs and Victor Schwartz, 17-3 Mealey’s

Litig. Rep.: Asb. 19 (Mar. 1, 2002) (quoting Mr.

Scruggs).

The Towers Watson consulting firm has identified

“more than 10,000 companies, including subsidiaries,

named in asbestos litigation.” Jenni Biggs et al., A

Synthesis of Asbestos Disclosures from Form 10-Ks —

Updated 1 (Towers Watson June 2013). Companies

formerly viewed as peripheral defendants are “now

bearing the majority of the costs of awards relating

to decades of asbestos use.” American Academy of

Actuaries’ Mass Torts Subcommittee, Overview of

Asbestos Claims Issues and Trends 3 (Aug. 2007).

In an attempt to further stretch the liability of

still-solvent companies, some plaintiffs’ counsel (as

in this case) are promoting the theory that makers of

uninsulated products in “bare metal” form should

have warned about potential harms from exposure to

asbestos-containing external thermal insulation

manufactured and sold by third-parties and attached

post-sale, such as by the Navy. Plaintiffs’ lawyers

are also claiming that manufacturers of products

such as pumps and valves that originally came with

asbestos-containing gaskets or packing should have

warned about potential harms from exposure to re-

placement internal gaskets or packing or replace-

bankruptcies” triggered “a search for new recruits to fill the gap

in the ranks of defendants’).

ment external flange gaskets manufactured and sold

by third parties.’

Plaintiffs’ lawyers are promoting this novel theo-

ry because the major asbestos producers have exited

the tort system through bankruptcy and the Navy is

immune. See Paul Riehle et al., Product Liability for

Third Party Replacement or Connected Parts: Chang-

ing Tides From the West, 44 U.S.F. L. Rev 33, 38

(2009) (“Not content with the remedies available

through bankruptcy trusts and state and federal

worker compensation programs, claimants’ lawyers

have extended the reach of products liability law to

‘ever-more peripheral defendants” whose products

may have been used by others with asbestos-

containing products) (citation omitted); Victor E.

Schwartz, A Letter to the Nation’s Trial Judges: As-

bestos Litigation, Major Progress Made Over the Past

Decade and Hurdles You Can Vault in the Next, 36

Am. J. of Trial Advoc. 1, 24-25 (2012) (“As a substi-

tute [for bankrupt former defendants], plaintiffs seek

to impose liability on solvent manufacturers for

harms caused by products they never made or sold.”).

Traditional tort principles do not support the duty

Respondents seek here, as demonstrated by many

non-asbestos cases. The proposed duty also repre-

sents unsound policy.

Further, an alternative compensation system ex-

ists to compensate Respondents for harms caused by

the bankrupt former asbestos producers. To the ex-

7’ See Peter Geier, Asbestos Litigation Moves On With World

War II Shipyard Cases ‘Dying Off, Plaintiff Attorneys Dig Deep-

er to Find New Strategies, 130:5 Recorder (San Francisco) 12

(Jan. 9, 2006).

tent Respondents’ exposures to asbestos came from

bankrupt companies’ products, trusts established in

bankruptcy provide a remedy. Maritime law's spe-

cial solicitude for the safety and protection of sailors

should not mean that Respondents have a tort reme-

dy against companies for asbestos-containing prod-

ucts they did not make or sell.

Respondents and the Third Circuit justify their

theory based on foreseeability. But courts must

draw a line limiting tort liability in order to avoid the

unending slippery slope that a foreseeability stand-

ard would inevitably create. See Thing v. La Chusa,

48 Cal. 3d 644, 659 (1989) (foreseeability, “is endless

because foreseeability, like light, travels indefinitely

in a vacuum.”). To maintain consistency and certain-

ty in the law, that line is logically drawn to bar lia-

bility where a plaintiff is harmed by a product that

was neither made nor sold by the defendant.

Amici urge the Court to reverse the Third Cir-

cuit’s decision and affirm the District Court’s grant

of summary judgment in favor of Petitioners.

ARGUMENT

I. TRADITIONAL TORT LAW PRINCIPLES

DO NOT SUPPORT IMPOSITION OF

LIABILITY FOR HARMS CAUSED BY

THIRD-PARTIES

Ordinarily, manufacturers are named in asbestos

cases with respect to asbestos they made or sold—not

to hold them liable for products made by others. It is

black-letter product liability law that manufacturers

are not liable for harms caused by others’ products in

cases such as this one. See James A. Henderson, Jr.,

Sellers of Safe Products Should Not Be Required to

Rescue Users from Risks Presented by Other, More

Dangerous Products, 37 Sw. U. L. Rev. 595, 602

(2008).*

A manufacturer's ability to foresee that its prod-

uct may be used in conjunction with a third-party’s

product does not turn the manufacturer into an in-

surer for harms caused by the other’s product. Oth-

erwise, a manufacturer would “be required to per-

form a watchdog function in order to rescue product

users from risks it had no active part in creating and

over which it cannot exert meaningful control.” /d.

at 601.

In a maritime asbestos personal injury case like

this one, the Sixth Circuit Court of Appeals held that

a manufacturer “cannot be held responsible for the

asbestos contained in another product.” Lindstrom

v. A-C Product Liability Trust, 424 F.3d 488, 496

(6th Cir. 2005). The court explained, “[t}his form of

guilt by association has no support in the law of

* See also 63A Am. Jur. 2d Products Liability § 1027 (‘The

manufacturer's duty to warn is restricted to warnings based on

the characteristics of the manufacturer's own products. The

law generally does not require a manufacturer to study and an-

alyze the products of others and warn users of the risks of those

products. Consequently, even where the manufacturer errone-

ably be expected to foresee is that consumers might be subject

to the risks of the manufacturer's own product, since those are

the only msks the manufacturer is required to know. The man-

ufacturer is not required to warn of dangers posed by use of an-

other manufacturer s product in the same vicinity as its product

was used.”); McNair v. Johnson & Johnson, 2018 WL 2186550,

at *5 (W. Va. May 11, 2018) ([rjequiring the defendant in a

products liability case to be either the manufacturer or the sell-

er of the product is the majority rule in this country’).

products liability.” Stark v. Armstrong World Indus.,

Inc., 21 F. App’x 371, 381 (6th Cir. 2001). The Ninth

Circuit in Boyd v. Warren Pumps, LLC, 654 F. App’x

875, 877 (9th Cir. 2016), has held that pump manu-

facturers “may be held liable only for [a sea cap-

tain’s] exposure to asbestos-containing products that

were either manufactured or supplied by them.” In

MclIndoe v. Huntington Ingalls Inc., 817 F.3d 1170,

1174 (9th Cir. 2016), a maritime general negligence

case against shipbuilders, the Ninth Circuit held

that a sailor had to demonstrate exposure to asbestos

from materials installed by the defendants to have a

claim against them.®

In another case, the California Supreme Court

explained, “we have never held that a manufactur-

ers duty to warn extends to hazards arising exclu-

sively from other manufacturers’ products.” O’Neil v.

Crane Co., 266 P.3d 987, 997 (Cal. 2012). The court

concluded, “expansion of the duty of care as urged

would impose an obligation to compensate on those

whose products caused the plaintiffs no harm. To do

so would exceed the boundaries established over dec-

ades of product liability law.” Jd. at 1007.

The Washington Supreme Court has said there is

“little to no support ... for extending the duty to

® See also Cabasug v. Crane Co., 989 F. Supp. 2d 1027, 1041 (D.

Haw. 2013); Stallings v. Georgia-Pacific Corp., 2015 WL

7258518, at *4 (W.D. Ky. Nov. 17, 2015); Nelson v. Air & Liquid

Sys. Corp., 2014 WL 6982476, at *13 (W.D. Wash. Dec. 9, 2014);

Oneal v. Alfa Laval, Inc., 2014 WL 5341878, at *5 (S.D. Fla.

Oct. 19, 2014); Vedros v. Northrop Grumman Shipbuilding,

Inc., 2014 WL 1093678, at *3 (E.D. La. Mar. 14, 2014); Crews v.

Air & Liquid Sys. Corp., 2014 WL, 639685, at *5 (N.D.N_Y. Feb.

18, 2014).

10

warn to another manufacturer's product.” Simonetta

v. Viad Corp., 197 P.3d 127, 132-33 (Wash. 2008).

The court held that a manufacturer is not liable for

failure to warn of the danger of exposure to asbestos

in insulation applied to its products if it did not

manufacture the insulation. In Braaten v. Saberha-

gen Holdings, 198 P.3d 493 (Wash. 2008), the court

rejected failure to warn claims against pump and

valve manufacturers for harm caused by asbestos-

containing replacement packing and replacement

gaskets made by third-parties. '°

The “prevailing majority rule” is that a manufac-

turer “cannot be liable for a third party's asbestos

materials used with its products, where the . . .

manufacturer was not in the chain of distribution of

such asbestos-containing materials.” Morgan v. Bill

Vann Co., Inc., 969 F. Supp. 2d 1358, 1366 (S.D. Ala.

2013); Dalton v. 3M Co., 2013 WL 4886658, at *10

'© See also Grant v. Foster Wheeler, LLC, 140 A.3d 1242, 1248

(Me. 2016) (summary judgment affirmed where plaintiff did not

demonstrate exposure to asbestos-containing products originat-

ing with defendants); Whiting v. CBS Corp., 982 N.E.2d 1224

(Table) (Maas. Ct. App. 2013) (affirming summary judgment to

manufacturers of turbines, pumps, valves, and pipes covered

with insulation made by a third party); Toole v. Georgia-Pacific,

LLC, 2011 WL 7938847, at *7 (Ga. Ct. App. 2011) (“[A}n asbes-

tos victim must present evidence that he was exposed to a de-

fendant’'s products.”); Moss v. Trane U.S., Inc., 2016 WL

916435, at *1 (W.D. Wis. Mar. 10, 2016) defendant not liable

for injuries “caused by products [its predecessor] did not manu-

facture, distribute or specify be used”); Robinson vu. Flowserve,

2015 WL 11622965, at *11 (D. Wyo. Oct. 9, 2015) (‘the Wyo-

ming Supreme Court would adopt the bare metal defense and

hold that manufacturers are not strictly liable for aftermarket

replacement parts that the manufacturer did not manufacture

or supply’).

11

(D. Del. Sept. 12, 2013) (“The majority of courts . . .

refuse to impose liability upon manufacturers for the

dangers associated with asbestos-containing prod-

ucts manufactured and distributed by other enti-

ties.”), report and recommendation adopted, 2013 WL

5486813 (D. Del. Oct. 1, 2013)."'

Courts that have broadened the traditional duty

to warn in some situations (as the Third Circuit did

below) justify their radical expansion of liability

based on foreseeability. The approach is geared to

make someone pay, even if that someone was not the

source of the exposure that caused the harm. See

Huck v. Wyeth, Inc., 850 N.W.2d 353, 380 (lowa

2014) (“Deep-pocket jurisprudence is law without

principle.”).

Foreseeability considerations guide manufactur-

ers as to when they must take safety measures with

respect to their own products, not to hold them re-

sponsible for others’ products. As the California Su-

preme Court explained, “manufacturers, distributors,

and retailers have a duty to ensure the safety of their

products ... we have never held that these responsi-

bilities extend to preventing injuries caused by other

products that might foreseeably be used in conjunc-

tion with a defendant’s product.” O’Neil, 266 P.3d at

991 (emphasis in original). The Washington Su-

preme Court said in Braaten, “whether the manufac-

turers knew replacement parts would or might con-

tain asbestos makes no difference because such

'! See also Mark A. Behrens & Margaret Horn, Liability for As-

bestos-Containing Connected or Replacement Parts Made by

Third Parties: Courts Are Properly Rejecting this Form of Guilt

by Association, 37 Am. J. Trial Advoc. 489 (2014).

12

knowledge does not matter, as we held in Simo-

netta.” 198 P.3d at 500 (citing Simonetta, 197 P.3d

at 136).

Courts in non-asbestos cases have refused to im-

pose liability on manufacturers of products used in

conjunction with harm-causing products made by

others. For example, in Brown v. Drake-Willock In-

ternational, Lid., 530 N.W.2d 510 (Mich. App. 1995),

a Michigan appellate court held that dialysis ma-

chine manufacturers owed no duty to warn hospital

employees of the risk of exposure to formaldehyde

supplied by another company even though the dialy-

sis machine manufacturers had recommended the

use of formaldehyde to clean their machines. The

court held: “The law does not impose upon manufac-

turers a duty to warn of the hazards of using prod-

ucts manufactured by someone else.” /d. at 515.

Courts have reached similar conclusions in other

types of cases. For example, a pickup truck manu-

facturer had no duty to warn consumers against im-

proper installation of aftermarket equipment, see

Westchem Agric. Chems. v. Ford Motor Co., 990 F.2d

426, 432 (8th Cir. 1993); an airplane manufacturer

was not liable for passengers’ circulatory problems

caused by seats made by a third-party and installed

post-sale, see In re Deep Vein Thrombosis, 356 F.

Supp. 2d 1055, 1068 (N.D. Cal. 2005); a manufactur-

er of electrically powered lift motors used in conjunc-

tion with scaffolding equipment had no duty to warn

of risks created by scaffolding made by others, see

Mitchell v. Sky Climber, Inc., 487 N.E.2d 1374, 1376

(Mass. 1986); a truck cab and chassis manufacturer

was not liable when a dump bed and hoist made by a

third-party post-sale caused an injury, see Shaw v.

13

Gen. Motors Corp., 727 P.2d 387, 390 (Colo. App.

1986); a crane manufacturer had no duty to warn

about rigging it did not place in the stream of com-

merce, see Walton v. Harnischfeger, 796 S.W.2d 225,

226 (Tex. App. 1990); a hydraulic valve manufacturer

was not liable for a defective log splitter used in con-

junction with its product, see Childress v. Gresen

Mfg. Co., 888 F.2d 45, 46, 49 (6th Cir. 1989); a manu-

facturer of a paint sprayer was not liable when a sol-

vent sold by a third-party to clean the sprayer

burned a user, see Dreyer v. Exel Indus., S.A., 326

F. App’x 353, 358 (6th Cir. 2009); a metal forming

equipment manufacturer was not liable for a defec-

tive wood planking used in conjunction with its

product, see Toth v. Econ. Forms Corp., 571 A.2d 420,

423 (Pa. Super. Ct. 1990); and a manufacturer of a

garbage packer mounted on a truck chassis was not

liable for a defect in a chassis made by a third-party,

see Sanders v. Ingram Equip., Inc., 531 So. 2d 879,

880 (Ala. 1988).

Courts in non-asbestos cases also have refused to

impose liability on manufacturers for harms caused

by replacement parts sold by third-parties. For ex-

ample, in Baughman v. General Motors Corp., 780

F.2d 1131 (4th Cir. 1986), the Fourth Circuit, apply-

ing South Carolina law, refused to hold a truck man-

ufacturer liable for a tire mechanic’s injuries when a

tire mounted on a replacement wheel rim assembly

exploded.'? The plaintiff contended that even though

the vehicle’s manufacturer did not place the re-

'2 See Harris v. Ajax Boiler, Inc., 2014 WL 3101941, at *5

(W.D.N.C. July 7, 2014) (finding Baughman to be “persuasive”

on the lack of a duty to warn about asbestos-containing prod-

ucts from third-parties).

14

placement wheel into the stream of commerce, the

vehicle was nevertheless defective because the man-

ufacturer failed to adequately warn of dangers with

similar wheels sold by others. The court said, “[t}he

duty to warn must properly fall upon the manufac-

turer of the replacement component part.” I/d. at

1333. The court explained:

Where, as here, the defendant manufacturer

did not incorporate the defective component

part into its finished product and did not place

the defective component into the stream of

commerce, the rationale for imposing liability

is no longer present. The manufacturer has

not had the opportunity to test, evaluate, and

inspect the component; it has derived no bene-

fit from its sale; and it has not represented to

the public that the component part is its own.

Id. at 1132-33 (emphasis added)."*

In Fleck v. KDI Sylvan Pools, 981 F.2d 107, 118

(3d Cir. 1992), the Third Circuit, applying Pennsyl-

vania law, held that it would be “unreasonable” to

impose liability on a swimming pool manufacturer

for injuries sustained by a diver as a result of a lack

of depth markers and warnings on a replacement

pool liner made by another manufacturer.

'8 See also Firestone Steel Prods. Co. v. Barajas, 927 S.W.2d 608

(Tex. 1996); Acoba v. Gen. Tire, Inc., 986 P.2d 288 (Haw. 1999);

Zambrana v. Standard Oil Co. of Cal., 26 Cal. App. 3d 209

(1972); Wiler v. Firestone Tire & Rubber Co., 95 Cal. App. 3d

621 (1979); Lytell v. Goodyear Tire & Rubber Co., 439 So. 2d

542 (La. Ct. App. 1983); Spencer v. Ford Motor Co., 367 N.W.2d

393 (Mich. Ct. App. 1985); Cousineau v. Ford Motor Co., 363

N.W.2d 721 (Mich. Ct. App. 1985); Reynolds v. Bridge-

stone/ Firestone, Inc., 989 F.2d 465 (11th Cir. 1993).

15

The weak foundation for the Third Circuit's duty

theory is further exposed by the fact that some courts

adopting the duty in asbestos cases appear not to

embrace it in non-asbestos cases.'* The rulings are

just the latest example of courts improperly applying

special results-oriented rules to asbestos cases in-

stead of treating such actions like other product lia-

bility cases.'°

The Court should reject Respondents’ invitation

to twist maritime tort law. As one commentator ex-

plained:

Asbestos litigation, over the decades, has

taken products liability substantive law, case

handling procedures, trial practice and

evidence well beyond then-existing frontiers.

Responsive to creative, persuasive and

resourceful claimants’ counsel, sensitive to the

plight of numerous seriously injured plaintiffs,

fearful of clogged court dockets and institu-

tional paralysis, many courts rushed headlong

'4 Compare Matter of New York City Asbestos Litig. (Dummitt v.

Crane Co.) and Matter of Eighth Jud. Dist. Asbestos Litig.

(Suttner v. Crane Co.), 59 N.E.3d 458 (N.Y. 2016), with Rastelli

vu. Goodyear Tire & Rubber Co., 591 N.E.2d 222 (N.Y. 1992);

May v. Air & Liquid Sys. Corp., 129 A.3d 984 (Md. 2015), with

Ford Motor Co. v. Wood, 703 A.2d 1315 (Md. Ct. Spec. App.

1998), abrogated on other grounds, John Crane, Inc. v. Scribner,

800 A.2d 727 (Md. 2002).

'8 See S. Todd Brown, Specious Claims and Global Settlements,

42 U. Mem. L. Rev. 559, 566 (2012) (because of relaxed eviden-

tiary requirements applied by some courts earlier in the asbes-

tos litigation, “many claims that would not be compensable in

typical personal injury cases — e.g., those lacking sufficient evi-

dence to establish specific causation — could now go before a

jury and be compensable.”).

16

to create systems that would force settlements

and penalize those defendants who chose trial

by saddling them with onerous conditions.

Many bankruptcies later, however, the new

waves of asbestos litigation now reach out

farther to more remote defendants, and often

stretch proofs of exposure and causation in

seeking to cast the broader liability net. The

recent decisions [rejecting a duty to warn with

respect to third-parties’ asbestos-containing

products] reflect that bedrock evidentiary and

products liability principles and the policies

that underlie them ought not be compromised

even though the claim is labeled as one involv-

ing “asbestos.”

Michael Hoenig, Commentary, No Liability for An-

other’s Asbestos Products, N.Y .L.J., Feb. 17, 2012.

Il. A DUTY TO WARN OF RISKS IN OTHERS’

PRODUCTS IS UNSOUND POLICY

A. A DUTY RULE WOULD LEAD TO A FLOOD OF

NEW ASBESTOS CASES, UNDULY PRESSURE

REMAINING DEFENDANTS, AND FUEL THE

SEARCH FOR “SOLVENT BYSTANDERS”

A flood of new cases could be expected if the Court

affirms the Third Circuit’s decision. Because the use

of asbestos-containing products was so prevalent on

ships for fireproofing (an important consideration at

sea), many asbestos actions fall under maritime

law.'6 Hundreds of companies made products that

‘6 See Eduardo C. Robreno, The Federal Asbestos Product Lia-

bility Multidistrict Litigation (MDL-875): Black Hole or New

Paradigm?, 23 Widener L.J. 97 (2013) (During World War II,

the United States government used asbestos in Navy shipyards

17

arguably were used in the vicinity of asbestos-

containing insulation or other asbestos-containing

products. Many product manufacturers may have

never sold a product containing an asbestos-

containing component (e.g., manufacturers of steel

pipe and pipe hangers; makers of nuts, bolts, wash-

ers, wire, and other fasteners of pipe systems; mak-

ers of any equipment attached to and using the pipe

system; and paint manufacturers), but they could po-

tentially be held liable under the Third Circuit's de-

cision.'7 Manufacturers and sellers of tools used

with asbestos-containing materials, such as power

saws, sanders, drills, hammers, or chisels, also could

face liability.

Defendants would also face undue pressure be-

cause they would be required to shoulder the cost of

harms caused by others’ asbestos products in addi-

tion to those caused by their own products. Some

companies could be forced into bankruptcy, like

scores of other asbestos defendants that faced ex-

treme liability."* So far, over 120 companies have

when constructing and repairing ships for the war effort. The

Navy became the country’s largest consumer of asbestos, stock -

piling and using it to prevent fires on the newly constructed

combat vessels. During that period, the Navy employed approx-

imately 4.5 million shipyard workers who potentially could

have been exposed to asbestos fibers.” ).

'? The Third Circuit identified factors for courts to consider in

deciding whether liability can arise, such as whether the de-

fendant’s product was originally equipped with an asbestos-

containing part that would eventually require replacement,

such as a gasket, but made clear that these may not be the only

facts on which liability can arise.

'8 See S. Todd Brown, Bankruptcy Trusts, Transparency and the

Future of Asbestos Compensation, 23 Widener L.J. 299, 306

18

declared bankruptcy due at least in part to asbestos-

related liabilities.'9

In addition, additional defendants would be

pulled into the litigation as plaintiffs’ attorneys ex-

pand their dragnet search for “solvent bystanders.”

See In re Garlock Sealing Technologies, LLC, 504

B.R. 71 (W.D.N.C. Bankr. 2014) (describing how a

gasket and packing manufacturer became a target of

asbestos cases following the bankruptcy wave until

the company was forced into bankruptcy partly be-

cause of manipulation of plaintiff exposure evidence).

It is also important to note that the asbestos liti-

gation shows no sign of abating. A 2016 review of

asbestos-related liabilities reported to the U.S. Secu-

rities and Exchange Commission by more than 150

publicly traded companies found that “[flilings re-

mained flat at the levels observed since 2007....”

Mary Elizabeth Stern & Lucy P. Allen, Resolution

Values Dropped 35% While Filings and Indemnity

Payments Continued at Historical Levels 1 (NERA

Econ. Consulting June 2016). Another study found

that mesothelioma claim filings have “remained near

peak levels since 2000.” Jenni Biggs et al., A Synthe-

sis of Asbestos Disclosures from Form 10-Ks — Up-

dated 1 (Towers Watson June 2013). “Typical projec-

tions based on epidemiology studies assume that

mesothelioma claims arising from occupational expo-

(2013) (‘Defendants who were once viewed as tertiary have in-

creasingly become lead defendants in the tort system, and

many of these defendants have also entered bankruptcy in re-

cent years.”).

'8 See Company Name and Year of Bankruptcy Filing (Chrono-

logically), available at https://www.crowell.com/files/List-of-

Asbestos-Bankruptcy-Cases-Chronological-Order. pdf.

19

sure to asbestos will continue for the next 35 to 50

years.” /d. at 5.

Bankruptcies have terrible consequences for

claimants, affected companies, workers, retirees, and

communities.” Plaintiff recoveries are substantially

delayed while companies are in bankruptcy.”

B. NON-ASBESTOS MARITIME

TORT CASES WILL INCREASE

The duty created by the Third Circuit would also

lead to new non-asbestos maritime tort filings since

presumably the duty would extend to any product

foreseeably used in conjunction with any hazard on a

ship. For example, manufacturers of paint brushes

may have to caution against the hazards of breathing

mineral spirits that are commonly used to clean

paint brushes. See Joseph W. Hovermill et al., Tar-

geting of Manufacturers, 47 No. 10 DRI For Def. 52,

2” See also Joseph E. Stiglitz et al., The Impact of Asbestos Lia-

bilities on Workers in Bankrupt Firms, 12 J. Bankr. L. & Prac.

51, 70-88 (2003) (exploring the effect of asbestos-related liabili-

ties and bankruptcies on employment, retirement security, gov-

ernment finances, and other economic factors); Christopher

Edley, Jr. & Paul C. Weiler, Asbestos: A Multi-Billion-Dollar

Crisis, 30 Harv. J. on Legis. 383, 386 (1993) (bankruptcy puts

substantial burdens on the “shareholders, employees, pension-

ers, and communities of asbestos defendants’ ).

2! See James Stengel, The Asbestos End-Game, 62 N.Y.U. Ann.

Surv. Am. L. 223, 260-61 (2006) (RAND looked at eleven major

asbestos bankruptcies and found that the average duration be-

tween filing and plan confirmation (which is the earliest date

payments could start) was six years. One case took ten years.

During these periods the trusts pay no money to claimants.

Furthermore, in the typical case plan confirmation itself can

precede any payment by months, if not years, due to various

startup delays.”).

20

54 (Oct. 2005). Perhaps the only limit on such an

expansive duty requirement would be the imagina-

tion of creative plaintiffs’ lawyers.

C. THE DUTY WOULD BE

ENDLESS AND UNPREDICTABLE

If a manufacturer's duty were defined by foresee-

able uses of other products, the chain of warnings

and liability would be endless and unpredictable.

Manufacturers cannot be expected to have research

facilities to identify potential dangers with respect to

all products that may be used in conjunction with or

in the vicinity of their own products. See Taylor v.

Elliott Turbomachinery Co., Inc., 90 Cal. Rptr. 3d

414, 422-23 (Ct. App. 2009) (“a bright-line legal dis-

tinction tied to the injury-producing product in the

stream of commerce ... acknowledges that over-

extending the level of responsibility could potentially

lead to commercial as well as legal nightmares in

product distribution”) (emphasis in original). Com-

panies “might well face the dilemma of trying to in-

sure against ‘unknowable risks and hazards.” Id. at

439 (citation omitted).

The unpredictability that would be created by the

imposition of liability would make it harder for busi-

nesses to grow and create jobs. Commentators have

observed with respect to asbestos litigation:

The uncertainty of how remaining claims may

be resolved, how many more may ultimately

be filed, what companies may be targeted, and

at what cost, casts a pall over the finances of . .

. American businesses. The cost of this unbri-

dled litigation diverts capital from productive

purposes, cutting investment and jobs. Uncer-

21

tainty about how future claims may impact

their finances has made it more difficult for af-

fected companies to raise capital and attract

new investment, driving stock prices down and

borrowing costs up.

George Scott Christian & Dale Craymer, Texas As-

bestos Litigation Reform: A Model for the States, 44

S. Tex. L. Rev. 981, 998 (2003).

D. OVER-WARNING COULD

UNDERMINE CONSUMER SAFETY

Consumer safety could be undermined by the po-

tential for over-warning and through conflicting in-

formation that may be provided by manufacturers of

different components and makers of finished prod-

ucts. See Victor E. Schwartz & Russell W. Driver,

Warnings in the Workplace: The Need for a Synthesis

of Law and Communication Theory, 52 U. Cin. L.

Rev. 38, 43 (1983) (‘The extension of workplace

warnings liability unguided by practical considera-

tions has the unreasonable potential to impose abso-

lute liability. ...”). As the California Supreme Court

said in O'Neil, “To warn of all potential dangers

would warn of nothing.” 266 P.3d at 1006 (citation

~»mitted); see also Straley v. United States, 887 F.

Supp. 728, 747 (D. N.J. 1995) (“Courts have held that

it is unreasonable to impose a duty upon a manufac-

turer to warn of all possible dangers posed by all

possible uses of a product because such ‘billboard’

warnings would deprive the user of an effective

warning.”).

E. A DuTY WOULD NoT PREVENT FUTURE HARM

Imposing liability on a defendant for others’ post-

sale use of asbestos-insulation or replacement parts

22

made by third-parties would not serve the policy of

preventing future harm. As a California Court of

Appeal explained:

It is doubtful respondents had any ability to

control the types of products that were used

with their equipment so long after it was sold.

They delivered various parts to the Navy dur-

ing World War II and had no control over the

materials the Navy used with their products

twenty years later when [plaintiff] was ex-

posed to asbestos. Indeed, imposing a duty to

warn on respondents now will do nothing to

prevent the type of injury before us — latent

asbestos-related disease resulting from expo-

sure four decades ago. Such exposures have

already taken place, and in light of the heavily

regulated nature of asbestos today, it is most

unlikely that holding respondents liable for

failing to warn of the danger posed by other

manufacturers’ products will do anything to

prevent future asbestos-related injuries.

Taylor, 90 Cal. Rptr. 3d at 439.22

2 In 1972, the federal Occupational Safety and Health Admin-

istration (OSHA’”) first issued permanent standards regulating

occupational exposure to asbestos. See 29 C.F.R. § 1910.1001.

“The 1972 OSHA regulations established standards for expo-

sure to asbestos dust and mandated methods of compliance

with the exposure requirements, including monitoring work

labeling products with warnings.” Horne v. Qwens-Corning Fi-

berglas Corp., 4 F.3d 276, 280 (4th Cir. 1993). After 1972,

OSHA's asbestos regulations “became increasingly stringent

over time” and most uses of asbestos ceased in the United

States. In re Joint E. & S. Dists. Asbestos Litig., 237 F. Supp.

2d 297, 310 (B. & S.D.N_Y. 2002).

23

lil. ASBESTOS TRUSTS PROVIDE AN

ALTERNATIVE COMPENSATION

SYSTEM FOR HARMS CAUSED BY

BANKRUPT FORMER ASBESTOS

PRODUCERS

Maritime law’s solicitude for the safety and pro-

tection of sailors does not justify “robbing Peter to

pay Paul,” which is the consequence of the Third Cir-

cuit’s ruling. Billions of dollars are available in

trusts to pay asbestos claimants for harms caused by

debtor companies that exited the tort system through

bankruptcy.27 See U.S. Gov't Accountability Office,

GAO-11-819, Asbestos Injury Compensation: The

Role and Administration of Asbestos Trusts 3 (Sept.

2011) ($36.8 billion in asbestos trusts as of 2011);

Lloyd Dixon & Geoffrey McGovern, Asbestos Bank-

ruptcy Trusts and Tort Compensation 2 (RAND Corp.

2011). To the extent Respondents’ exposures to as-

bestos came from products made by bankrupt com-

panies, the trusts provide a remedy. See William P.

Shelley et al., The Need for Further Transparency Be-

tween the Tort System and Section 524(g) Asbestos

Trusts, 2014 Update — Judicial and Legislative De-

velopments and Other Changes in the Landscape

Since 2008, 23 Widener L.J. 675, 675 (2014) (trusts

established in asbestos-related bankruptcy reorgani-

zations “answer for the tort liabilities of the great

Section 524(g) of the Bankruptcy Code provides a mechanism

See 11 U.S.C. § 524(g); Lloyd Dixon et al, Asbestos Bankruptcy

Trusts: An Overview of Trust Structure and Activity with De-

tailed Reports on the Largest Trusts (RAND Corp. 2010).

24

majority of the historically most-culpable large man-

ufacturers that exited the tort system through bank-

ruptcy over the past several decades”).

The asbestos trust system is non-adversarial; it is

much easier ard faster than bringing a lawsuit. See

John J. Hare & Daniel J. Ryan, Uncloaking Bank-

ruptcy Trust Filings in Asbestos Litigation: Refuting

the Myths About Transparency, 15-9 Mealey’s Asb.

Bankr. Rep. 1, 3 (2015) (“Plaintiffs’ lawyers routinely

advertise their ability to file trust claims ‘quickly and

easily, and tell potential clients that paralegals

evaluate potential trust claims and undertake the

filing process. The evidence also demonstrates that

trust claims are paid more quickly than tort

claims.”); Marc C. Scarcella & Peter R. Kelso, A Re-

organized Mess: The Current State of the Asbestos

Bankruptcy Trusi System, 14-7 Mealey’s Asb. Bankr.

Rep. 32, 39 (2015) (“Unlike lawsuits filed in the tort

system, the trust compensation process is intended

to avoid the time, expense, and resource burden often

associated with litigation.”).

Further, because trust payment procedures are

voted on “by the claimants through their attorneys,

and the trusts often do not contest liability, it is

much easier to collect against a bankruptcy trust

than a solvent defendant.” Adrienne Bramlett Kvel-

lo, The Best of Times and the Worst of Times: How

Borg-Warner and Bankruptcy Trusts Are Changing

Asbestos Settlements in Texas, 40 The Advoc. (Tex.)

80, 80 (2007); see also Thomas M. Wilson, /nstitu-

tionalized Fraud in Asbestos Bankruptcy Trusts, 29-7

Mealey’s Litig. Rep.: Asb. 1, 6 (2014) (“the trusts, de-

signed by the same individuals who are now submit-

ting claims, contain ‘loopholes’ allowing for ease of

25

payment, often without the need for any real proof.

By using the loopholes which have been integrated

into the system itself, asbestos claimants can legiti-

mately obtain compensation which they are other-

wise precluded from obtaining in the tort system.”).

To recover from an asbestos trust, a claimant files

a short claim form which, among other things, “re-

quires a statement of injury; information sufficient to

establish asbestos exposure attributable to the

trust's predecessor .. . and a determination as to

whether the claimant is seeking expedited or indi-

vidual review.” S. Todd Brown, Bankruptcy Trusts,

Transparency and the Future of Asbestos Compensa-

tion, 23 Widener L.J. 299, 317-18 (2013).% The

claimant will also submit evidence of exposure, such

as a “work history, Social Security records, invoices,

employer records, or deposition testimony of the

claimant or coworkers taken in asbestos litigation,”

and “medical reports or records sufficient to support

a diagnosis for the specific disease being claimed or,

if applicable, a copy of a death certificate.” US.

Gov't Accountability Office, supra, at 18; see also Di-

onne Searcy & Rob Barry, As Asbestos Claims Rise,

So Do Worries About Fraud, Wall St. J., Mar. 11,

2013, at Al (“Unlike court, where plaintiffs can be

cross-examined and evidence scrutinized by a judge,

trusts generally require victims or their attorneys to

supply basic medical records, work histories and sign

forms declaring their truthfulness. The payout is far

* For a representative trust claim form, see Manville Persona!

Injury Settlement Trust 2002 TDP Proof of Claim Form,

http://www.claimsres.com/wp-content/uploads/2016/1 1/

POCO02V4.pdf.

26

quicker than a court proceeding and the process is

less expensive for attorneys.”).

If a trust determines that a claim meets the crite-

ria required for payment, the trust will make an offer

based on a percentage of the “scheduled value” for

the alleged injury, as set forth on a grid. A recent

deposition of the general counsel of the Manville

Trust established that there is no backlog and that

an offer can be made within days after submission.

See Deposition of Jared Garelick, in Cummings v.

General Elec., No. 13-Cl-006374 (Jefferson Ky. Cir.

Ct. Dec. 14, 2015), at 34-36. After the offer is accept-

ed, payments tend to be made quickly.”®

It is common for claimants to receive multiple

trust payments since each trust operates inde-

pendently and workers were often exposed to differ-

ent asbestos products. See Lester Brickman, Fraud

and Abuse in Mesothelioma Litigation, 88 Tul. L.

Rev. 1071, 1078-79 (2014).

Trust payments in the aggregate can be substan-

tial. In a recent bankruptcy case involving gasket

and packing manufacturer Garlock Sealing Technol-

ogies, LLC, a typical mesothelioma plaintiffs recov-

ery was estimated to be $1—1.5 million, “including an

average of $560,000 in tort recoveries and about

$600,000 from 22 trusts.” In re Garlock Sealing

Technologies, LLC, 504 B.R. at 96.

* The U.S. GAO estimates that approximately 97-98% of trust

claims are processed on this expedited basis. See U.S. Gov't

Accountability Office, supra, at 20. Only a tiny percentage of

claimants seek individual review in the hopes of obtaining more

compensation from the trusts. See id. at 554; Deposition of Jar-

ed Garelick, supra, at 37-38.

27

The Third Circuit’s ruling would mean that in

addition to the substantial recoveries available to

maritime asbestos plaintiffs today—..e., (1) payments

from potentially multiple trusts for trust-related ex-

posures and (2) tort actions against still-solvent de-

fendants for exposures if connected to their own

products”*—plaintiffs would also have a tort remedy

against additional defendanis for asbestos-

containing products they did not make or sell. This

is unnecessary to meet maritime law's solicitude for

the safety and protection of sailors.

CONCLUSION

For these reasons, amici urge the Court to reverse

the Third Circuit's decision and affirm the District

Court’s grant of summary judgment in favor of Peti-

tioners.

Respectfully submitted,

Mark A. Behrens

Counsel of Record

% See Lloyd Dixon & Geoffrey McGovern, Bankruptcy’s Effect on

Product Identification in Asbestos Personal Injury Cases iii

(RAND Corp. 2015) (“Plaintiffs now often receive compensation

both from the trusts and through a tort case.”); see also U.S.

Gov't Accountability Office, supra, at 15 (‘Although 60 compa-

nies subject to asbestos-related liabilities have filed for bank-

ruptcy under Chapter 11 and established asbestos bankruptcy

trusts in accordance with § 524(g), asbestos claimants can also

seek compensation from potentially liable solvent companies

(that is, a company that has not declared bankruptcy) through

the tort system.”).

28

Christopher E. Appel

SHOOK, HARDY & BACON L.L.P.

1155 F Street, NW, Suite 200

Washington, DC 20004

(202) 783-8400

Of Counsel

Kenneth Stoller

AMERICAN INSURANCE ASSOCIATION

555 12th Street, NW, Suite 550

Washington, DC 20004

(202) 828-7100

Karen R. Harned

Elizabeth Milito

NFIB SMALL BUSINESS LEGAL CENTER

1201 F Street, NW, Suite 200

Washington, DC 20004

(202) 314-2061

H. Sherman Joyce

Lauren S. Jarrell

AMERICAN TORT REFORM ASSOCIATION

1101 Connecticut Avenue, NW, Suite 400

Washington, DC 20036

Dated: July 16, 2018