Amicus Curiae Brief — General Dynamics Corp. v. Trevino

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Supreme Court, US.

\ FILED

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No. 89-376

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JOSEPH F. SPANIOL, JR.

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IN THE .

Supreme Court of the United States

OCTOBER TERM, 1989

GENERAL DYNAMICS CORPORATION,

Petitioner,

Vv.

GLORIA TREVINO, et al.,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Fifth Circuit

BRIEF AMICUS CURIAE OF THE

CHAMBER OF COMMERCE OF THE UNITED STATES

IN SUPPORT OF THE PETITIONER

ROBIN S. CONRAD

Counsel of Record

NATIONAL CHAMBER LITIGATION

CENTER, INC.

1615 H Street, N.W.

Washington, D.C. 20062

(202) 463-5337

Counsel for the Amicus Curiae

Chamber of Commerce of the

United States

WILSON - Epes PRINTING Co.,

NC. - 789-0096 - WASHINGTON, D.C. 20001

TABLE OF AUTHORITIES

STATEMENT OF INTEREST

TABLE OF CONTENTS

STATEMENT OF THE CASE ...... 2...

SUMMARY OF THE ARGUMENT

REASONS FOR GRANTING THE WRIT .

I.

II.

CONCLUSION

The Fifth Circuit Erred In Making Government

' “Approval” of Design Specifications Equivalent

To Exercising A “Discretionary Function” .......

A. Trevino Distorts This Court’s Use Of The

“Discretionary Function Doctrine” In Boyle..

B. Government “Approval” Under Trevino Will

Result In The Same Kind Of Excessive Ju-

dicial Scrutiny This Court Sought To Avoid

In Boyle

A Simple Yearsley-type Test For Government

“Approval” Would Minimize Judicial Scrutiny

Of Military Decisions And Add Certainty to the

Government Contractor Defense ..........................

A. Determining The Nature And Use To Which

A Product Is Put Requires No Judicia! In-

trusion Into Military Decisionmaking........

B. A Yearsley-type Test Advances The Separa-

tion Of Powers Principles Which Are At

The Heart Of The Boyle Defense ...................

Page

12

14

15

17

18

ii

TABLE OF AUTHORITIES

CASES Page

Allen v. United States, 816 F.2d 1417 (10th Cir.

1987), cert. denied, 108 S. Ct. 694 (1988) _._... 14

Berkovitz v. United States, —— U.S. ——, 56

U.S.L.W. 4549 (June 14, 1988) —.......-2 ee... 18

Blessing v. United States, 447 F. Supp. 1160 (E.D.

BRIER W's SSS FRADE OER SL PT OU 14

Boyle v. United Technologies Corp., —— USS.

———=, 108 §. Ct. 25610 (1068) .................pene......0- passim

Bynwin v. FMC Corp., 770 F.2d 556 (sth Cir.

1985) ..... : : 7

Dalehite v. United States, 346 U. s. 15 (1953) 8k 13

Dube v. Pittsburgh-Corning, Civil No. 83-0224 P,

1988 U.S. Dist. Lexis 5739 (D. Me. June 9,

TG ak Ca eee Ss <....... 14

Dube v. Pittsburgh-Corning, 870 F.2d 790 (1st

Cir. 1989), petition for reh’g denied, May 23,

Feres v. United States, 340 U.S. 185 (1950) .......... 6, 11

In Re New York City Asbestos Litigation, Index

No. 17516-87 et al., 1989 N.Y. Misc. Lexis 315

(N.Y. Sup. Ct. May 9, 1989) ............................... 4

McKay v. Rockwell International Corp., 704 F.2d

444 (9th Cir. 1983), cert. denied, 462 U.S. 1048

I aaa iis cnsckiccdninieasenibeaanniaie nied Ratti Lach ans 16

Smith v. Johns-Manville Corp., 795 F.2d 301 (8rd

ia |

Stencel Aero Engineering Corporation Vv. U.S., 431

6 gf Re ery ee eer oe ee ee 6, 11

Tozer Vv. LTV Corp. . 792 F.2d 408 (4th Cir.

| TEEN rea cape 17

Trevino V. General Dynamics Corp., 626 F. Supp.

SE Cae ee wckcrnechetiectenscnacenitiedanteaee. 6

Trevino V. General Dynamics Corp. . 865 F.2d

1474, reh’g denied, 876 F.2d 1154 (5th Cir.

FE ciehibotclnchiiiciaianth haincaneoesiiadagialebadiiniaviouddeal passim

United States v. S. A. Empresa de Viacao Aerea

Rio Grandense (Varig Airlines) 467 U.S. 797

(1984) sities ikitnchapalaaiddilieajanapeeinibadiadaina sin 4,13

ili

TABLE OF AUTHORITIES—Continued

Page

Yearsley v. W. A. Ross Construction Co., 309 U.S.

I ic ah dailies enitnoneniones 3,15

STATUTES

Federal Tort Claims Act, 28 U.S.C. § 1346 (b) .......... 4,10

Federal Tort Claims Act, 28 U.S.C. § 2680 (a) ......... 4, 7,10

MISCELLANEOUS La

Ausness, Surrogate Immunity: The Government

Contract Defense and Products Liability, 47°

a Ee 12

Scadron, The New Government Contractor De-

fense: Will It Insulate Asbestos Manufacturers

From Liability For The Harm Caused By Their

Insulation Products?, 25 Idaho L. Rev. 375

(1988-89)

IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

No. 89-376

GENERAI DYNAMICS CORPORATION,

Petitioner,

Vv. 2

GLORIA TREVINO, et al.,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Fifth Circuit

BRIEF AMICUS CURIAE OF THE

CHAMBER OF COMMERCE OF THE UNITED STATES

IN SUPPORT OF THE PETITIONER

INTEREST OF THE AMICUS CURIAE

With the written consent of the parties,’ the Chamber

of Commerce of the United States (“Chamber”) respect-

fully submits this brief amicus curiae in support of the

Petitioner, General Dynamics Corporation. The Cham-

ber is the nation’s largest federation of business organ-

izations and individuals. Its membership includes over

180,000 corporations, partnerships and proprietorships,

as well as several thousand trade and professional asso-

ciations, and state and local chambers of commerce.

Many Chamber members, both large and small busi-

nesses, are involved in the defense industry and partici-

1 Letters of consent are on file with the Clerk of the Court.

pate in the design and manufacture of military equip-

ment for use by and under contracts with the United

States government. The Chamber regularly represents

the interests of these government contractor members on

issues of national concern before Congress,? the Execu-

tive branch * and the courts.‘ Most recently, the Chamber

filed an amicus brief before this Court on their behalf

in Boyle v. United Technologies Corp., —— U.S. ——,

_ 108 S. Ct. 2510 (1988), a landmark case which provided

government contractors with much needed protection

from state tort liability for design defects in military

equipment. In Boyle, this Court recognized a government

contractor defense as a matter of federal common law

and set forth a three-part test for determining the scope

of contractor immunity. Under this test, a government

2 See e.g., Comments of the Chamber of Commerce of the United

States on H.R. 2579, the “Defense Contractor Whistleblower Act

of 1989,” submitted to the House Committee on Armed Services

(July 10, 1989); Statement of the Chamber of Commerce of the

United States on H.R. 3911, the “Major Fraud Act of 1988,” sub-

mitted to the Senate Committee on the Judiciary (July 12, 1988) ;

and Statement of the Chamber of Commerce of the United States

on the “Reauthorization of the Office of Federal Procurement Pol-

icy,” submitted to the Subcommittee on Federal Spending, Budget

and Accounting of the Senate Committee on Governmental Affairs

(March 25, 1988).

3 See e.g., Comments of the Chamber of Commerce of the United

States on General Services Administration Proposed Rule on “Pro-

curement Integrity,” Federal Acquisition Regulation (FAR) Case

89-23 (April 26, 1989) and Comments of the Chamber of Commerce

of the United States on General Services Administration Interim

Rule on the “Drug-Free Workplace Act of 1988 (April 5, 1988)

4The Chamber has filed amicus briefs on behalf of its govern-

ment contractor members in a number of important cases at the

lower court level. See e.g., U.S. v. Westinghouse Electric Corp.,

615 F. Supp. 1168 (D.C. Pa. 1985) aff'd, 788 F.2d 164 (3d Cir.

1986); U.S. v. Newport News Shipbuilding and Dry Dock Co.,

837 F.2d 162 (4th Cir. 1988) (“Newport News I”); and U.S. v.

Newport News Shipbuilding and Dry Dock Co., 655 F. Supp. 1408

(E.D.Va. 1987) (“Newport News II”).

3

contractor must prove (1) that the government approved

reasonably precise specifications: (2) that the equipment

conformed with those specifications and (3) that the con-

tractor warned the government about the dangers in

using the equipment known to it but not to the govern-

ment.

As amicus curiae in Boyle, the Chamber urged the

Court to adopt a simple test for contractor immunity.

similar to the one articulated in Yearsley v. W. A. Ross

Construction Co., 309 U.S. 18 (1940), the only Supreme

Court precedent on the subject of a government contrac-

tor defense.’ Under a Yearsley approach, a military con-

tractor would not be liable in tort for injuries resulting

from a “uniquely military” product that was put to

“military use.”

The Chamber argued in its amicus brief that a

Yearsley-type defense—which would focus only on the

nature of the product and its use—would substantially

minimize judicial scrutiny into military decisionmaking

and add certainty to the scope of contractor immunity

from tort liability. The Chamber also predicted that a

simple Yearsley-type defense would prevent courts from

becoming mired in questions of how to construe each ele-

ment of a more complicated government contractor

defense.

As the first post-Boyle decision to reach this Court,

Trevino Vv. Generai Dynamics Corp., 865 F. 2d 1474, reh’g

denied, 876 F.2d 1154 (5th Cir. 1989), is a classic ex-

ample of the judicial interpretation problems that can

result from complicated multi-part tests. By holding that

government “approval” under the first prong of the

5The Yearsley Court held a public works contractor immune

from liability essentially because it was carrying out the will of the

government. 309 U.S. 20-21.

a

Boyle test must be equivalent to the exercise of a discre-

tionary function under the Federal Tort Claims Act,* the

Fifth Circuit has added a complex layer of analysis to the

governmental contractor defense never intended by this

Court.

Rather than eliminating the uncertainty surrounding

the application of the government contractor defense, as

was Boyle’s intent, the Fifth Circuit grafted a confusing

body of case law onto the first prong of the Boyle test

which renders the test completely unworkable. In so

doing, the Trevino court has seriously undermined this

Court’s decision in Boyle and significantly eroded the

government contractor defense.

On behalf of the American business community, the

Chamber urges this Court to correct the Fifth Circuit’s

error and prevent further erosion’ of Boyle and the pro-

tection it affords government contractors. For these and

the reasons stated below, the Chamber respectfully re-

*The FTCA is an express waiver of sovereign immunity which

allows the federal government to be sued for monetary damages

for harm caused by negligent or wrongful conduct of federal em-

ployees. 28 U.S.C. §1346(b), 2671-2680. Under the discretionary

tunction exception, however, the FTCA retains sovereign immunity

for any claim “based on the exercise or the failure to exercise or

perform a discretionary function or duty on the part of a federal

agency or an employee of the Government, whether or not the dis-

cretion involved be abused.” 28 U.S.C. § 2680(a). What constitutes

a “discretionary function” is the subject of much confusion and a

continually growing body of caselaw. See generally, United States

v. S. A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines)

467 U.S. 797 (1984).

tT See, In Re New York City Asbestos Litigation, Index No. 17516-

87 et al., 1989 N.Y. Misc. Lexis 315, 5 (N.Y. Sup. Ct. May 9, 1989)

(“In order to satisfy the first element of the Boyle test, not

only must there be governmental approval of design of the

product, but such approval must be a discretionary function

cf the government.’”’)

5

quests this Court to grant General Dynamics’ Petition

for a Writ of Certiorari in this case and reconsider a

Yearsley-type approach for determining what constitutes

government “approval” of design specifications under the

Boyle defense.

STATEMENT OF THE CASE

This case arises out of an accident in which five Navy

scuba divers died from vacuum-induced bends in the div-

ing chamber of a Navy submarine. The cause of death

was attributed to the failure of the ventilation valve of

the diving chamber to be fully opened, which prevented

air from entering the chamber while releasing water

from it. The accident occurred on January 16, 1982, ap-

proximately twenty years after the Navy established the

basic design concept for converting the submarine into a

personnel-carrier capable of dispatching divers under-

water.® Not only did the Navy develop the design details

for the diving chamber, but it also built, tested and in-

stalled the chamber in the submarine at a naval shipyard

of its choice.

The Navy had contracted with the General Dynamics

Corporation (“General Dynamics”) in 1966 and 1967

to produce working drawings of the diving hangar and

its “lock in/lock out” system, which allowed divers to

exit and re-enter the submarine through a flooded diving

chamber. General Dynamics completed its contract in

1968, having produced 31 working drawings for the

Navy. Each of those drawings was reviewed and “ap-

proved” by Navy personnel on separate, individual sig-

nature blocks. The Navy exclusively performed and com-

8 The Navy set forth its design concept for the diving chamber in

a 339-page circular of requirements, called a “COR”. Included in

the “COR” was a two-page description of the diving hangar

design and a one-page diagram of the chamber’s flood and drain

system (otherwise known as the “lock in/lock out system”).

6

pleted all manufacturing and conversion work on the

submarine, including the construction and installation of

the diving chamber, during the following year.

Between 1969 and 1982, when the accident occurred, the

Navy used the diving chamber® as designed without al-

teration, despite its actual knowledge that the ventilation

valve was difficult to open and its control handle was

difficult to see.” Notwithstanding such notice, the Navy

chose not to conduct a formal design/safety review of the

diving system until after the accident occurred.

The families of the divers sued the Navy and General

Dynamics in the U.S. District Court for the Eastern Dis-

trict of Texas for strict liability, negligence and breach

of warranty. Trevino v. General Dynamics Corp., 626 F.

Supp. 1330 (E.D. Tex. 1986). The Navy claimed immu-

nity from suit under the Feres/Stencel doctrine. Gen-

eral Dynamics raised the government contractor defense.

® According to the Petition for a Writ of Certiorari, the Navy

used the diving chamber 555 times during those years. See Pet.

Cert. at 3.

10 The Navy had been informed by its own personnel “on at least

four occasions that the ventilation valve control was difficult to

turn.” Trevino v. General Dynamics Corp., 856 F.2d 1474, 1477

(5th Cir. 1989).

11 The Feres/Stencel doctrine of government immunity from tort

liability derives from two Supreme Court cases. In Feres v. United

States, 340 U.S. 135, 146 (1950), the Court held that the “[g]Jov-

ernment is not liable under the Federal Torts Claims Act for in-

juries to servicemen where the injuries arise out of or are in the

course of activity incident to service.” In Stencel Aero Engineer-

ing Corporation Vv. United States, 431 U.S. 6A6 (1977), the Court

broadened the scope of government immunity by barring contrac-

tors from seeking indemnity from the government for damages

arising out of service-related injuries to members of the armed

forces.

7

The district court found that the Navy and General

Dynamics were both negligent. It apportioned 80% of

the liability to General Dynamics for the design of the

diving chamber and 20% to the Navy for failure to

maintain the chamber and adequately train the divers in

how to deal with the possibility of vacuum formation.

Nevertheless, the court upheld the Navy’s defense, but

refused to grant General Dynamics’ claim for immunity

under a pre-Boyle version of the government contractor

defense.’ The district court held that General Dynamics

could not avail itself of the defense because it, and not the

Navy, had performed the design work in question.

The U.S. Court of Appeals for the Fifth Circuit af-

firmed. Focusing exclusively on the first prong of the

government contracts defense established by this Court

in Boyle v. United Technologies Corporation, US.

—-, 108 S. Ct. 2510 (1988), the Fifth Circuit held

that government “approval under the defense must con-

stitute a discretionary function” within the meaning of

the Federal Tort Claims Act, 28 U.S.C. § 2680 (a).

Trevino, 865 F.2d at 1480. Accordingly, the Fifth Cir-

cuit found that General Dynamics did not meet the first

prong of the Boyle test because the Navy did not conduct

a “substantive review and evaluation of the contractor’s

design choices.” Id. at 1486.

12 Bynum V. FMC Corp., 770 F.2d 556 (5th Cir. 1985). In

Bynum, the prevailing case in the Fifth Circuit at the time, the

“reasonably precise specifications” were established by the govern-

ment, and not the contractor; thus, the Court never reached the

question of what constitutes approval.

18 The Fifth Circuit issued its opinion less than one year after

this Court decided Boyle.

8

SUMMARY OF THE ARGUMENT

The Fifth Circuit’s wholesale importation of the dis-

cretionary function doctrine into the “approval” element

of the government contractor defense completely distorts

this Court’s discussion of that exception to the Federal

Tort Claims Act (“FTCA”) in Boyle. This Court relied

on the discretionary function exception as a philosophical

predicate for recognizing a government contractor de-

fense under federal common law. It did not intend for

the doctrine to be incorporated as an element of the Boyle

defense itself.

By equating government “approval” with the exercise

of a discretionary function under the FTCA, the Fifth

Circuit has grafted onto the first prong of the govern-

ment contractor defense a confusing body of case law

that intricately involves the judiciary in military deci-

sionmaking. The degree of scrutiny required by the

Fifth Circuit to determine whether the government per-

formed a “substantive review and evaluation” ** which

“involve[d] the use of policy judgment” * will invariably

result in the same kind of judicial scrutiny of military

decisions this Court tried to avoid by establishing a gov-

ernment contractor defense under federal common law

in Boyle.

The unnecessary complexity of the Fifth Circuit’s in-

terpretation of the first prong of the Boyle test could

itself have been avoided had this Court adopted a

Yearsley-type government contractor defense in the first

place. Determining whether a product is military or

commercial is a relatively simple process requiring no

intrusion by the courts into military decisionmaking.

Evidence that a product was put to a military use can

be proved in several ways, none of which require the

judiciary to second-guess procurement decisions.

14 Trevino, 865 F.2d at 1480.

15 Jd,

9

REASONS FOR GRANTING THE WRIT

I. The Fifth Circuit Erred In Making Government Ap-

proval Equivalent To Exercising A “Discretionary

Function.”

In Trevino v. General Dynamics Corp., the Fifth Cir-

cuit refused to grant the Petitioner the protection of the

government contractor defense because it did not satisfy ~

the “approval” element of the Boyle test. 865 F.2d 1474,

1479 (1989). According to Trevino, “approval under the

defense must constitute a discretionary function” within

the meaning of the Federal Tort Claims Act. Jd. at 1480.

The Trevino court defined discretionary functions as gov-

ernment acts “that involve the use of policy judgment”

requiring “substantive review or evaluation.” Jd. It fur-

ther required that the government exercise its discretion

“over significant details and all critical design choices.”

Id. at 1481.

The Fifth Circuit based its interpretation of govern-

ment “approval” on this Court’s discussion of the dis-

cretionary function doctrine in Boyle v. United Tech-

nologies Corp., —— U.S. ——, 108 S. Ct. 2510 (1988).

In so doing, the Fifth Circuit has completely distorted

the role of the doctrine in the Boyle Court’s analysis of

the government contractor defense as a matter of federal

common law. This Court should grant General Dynamics’

Petition for a Writ of Certiorari to correct the Fifth

Circuit’s error.

A. Trevino Distorts This Court’s Use Of The “Discre-

tionary Function Doctrine” In Boyle.

In Boyle, this Court established a three-part test under

federal common law for determining contractor immunity

from state tort actions arising out of design defects in

military equipment. Under this test, a government con-

tractor would not be liable for design defects under state

tort law if it could prove that (1) the government ap-

proved reasonably precise specifications; (2) the equip-

10

ment conformed to those specifications; and (3) the con-

tractor warned the government about the dangers known

to the contractor, but not the government.

As a prerequisite for federal common law displacement

of state law, the Court noted that there must be a “sig-

nificant conflict between the state law and a federal pol-

icy or interest.” Boyle, 108 S. Ct. at 2516. The Court

identified “the procurement of equipment by the United

States” 1° as providing a “ ‘uniquely federal’ interest” ™’

and selected the discretionary function exception of the

Federal Tort Claims Act (“FTCA’’)*® as the basis for the

“significant conflict.”** Under an express waiver of

sovereign immunity, the FTCA allows the federal gov-

ernment to be sued for monetary damages for harm

caused by the negligent or wrongful conduct of federal

employees. The discretionary function exception, how-

ever, retains sovereign immunity for any claim “based

on the exercise or the failure to exercise or perform a

discretionary function or duty on the part of a federal

agency or an employee of the Government, whether or

not the discretion involved be abused.” 28 U.S.C.

§ 2680 (a).

By predicating the government contractor defense on

the discretionary function doctrine, this Court signifi-

cantly altered the approach previously taken in applying

the government contractor defense. Scadron, The New

Government Contractor Defense: Will It Insulate Asbes-

tos Manufacturers From Liability For The Harm Caused

By Their Insulation Products?, 25 Idaho L. Rev. 375, 377

(1988-89). Prior to Boyle, the majority of federal courts

16 Jd. at 2515.

17 Jd. at 2514.

18 28 U.S.C. § 1346 (b), 2671-2680.

19 Jd. at 2517.

11

pointed to the Feres-Stencel doctrine,2° which immunizes

the government from tort liability arising out of injuries

to service personnel, as the predicate of the defense. The

Boyle. Court rejected Feres-Stencel as the source of the

“ ‘significant conflict between federal interests and state

law’ ” ** because the doctrine produced results that were

simultaneously “too broad” and “too narrow” when ap-

plied to government contractor liability. Id. The Court

viewed Feres-Stencel as “too narrow” a basis for justify-

ing federal displacement of state law because the doctrine

covers only service-related injuries and could not be in-

voked to prevent a civilian’s suit against a military con-

tractor. Jd. At the same time, the Court also found the

Feres-Stencel doctrine to be “too broad” a basis for dis-

placement because it would deny_recovery for injuries

caused by standard equipment purchased by the govern-

ment from stock. Jd.

This Court’s choice of discretionary function over

Feres-Stencel as the predicate for the government con-

tractor defense also significantly broadened the applica-

tion of the defense. As stated above, Boyle relied on the

discretionary function exception as a philosophical pred-

icate for recognizing a government contractor defense

under federal common law. Nothing in the Boyle opinion

remotely suggests that the doctrine itself should be in-

corporated as part of the Boyle test. The Court’s state-

ment that the first two elements of the Boyle defense

“assure that the suit is within the area where the policy

of the ‘discretionary function’ would be frustrated,”

20In Feres v. U.S., 340 U.S. 185 (1950), the Supreme Court

found that a member of the armed forces did not have a cause of

action under the FTCA for service-related injuries. In Stencel

Aero Engineering Corporation v. U.S., 431 U.S. 666 (1977), the

Supreme Court held that a contractor had no right to indemnifica-

tion against the government when it was found liable to a service

member.

21 Boyle, 108 S. Ct. at 2517.

22 Jd. (emphasis added).

12

serves only to support its recognition of the discretionary

function doctrine as the proper policy basis for federal

displacement of state law. The Fifth’s Circuit’s whole-

sale importation of the discretionary fur “om doctrine

engrafts on the Boyle test a requirement that totally dis-

torts this Court’s displacement analysis. For this reason

alone, the Court should grant the Petition for a Writ of

Certiorari.

B. Government “Approval” Under Trevino Will Result

In The Same Kind Of Excessive Judicial Scrutiny

This Court Sought To Avoid In Boyle.

The purpose of the discretionary function exception is

to allow members of the executive branch to carry out

policy decisions without unwarranted judicial interfer-

ence. Ausness, Surrogate Immunity: The Government

Contract Defense and Products Liability, 47 Ohio St. L.

J. 985, 989 (1986). This Court recognized that purpose

when choosing the discretionary function exemption as

the “limiting principle” for determining the scope of fed-

eral displacement of state tort law in Boyle. Specifically,

the Court noted:

We think that the selection of the appropriate de-

sign for military equipment to used by our Armed

Forces is assuredly a discretionary function within

the meaning of this provision. It often involves not

merely balancing engineering analysis but judgment

as to the balancing of many technical, military, and

even social considerations, including specifically the

trade-off between greater safety and greater combat

effectiveness. And we are further of the view that

permitting ‘second-guessing’ of these judgments...

through state tort suits against contractors would

produce the same effect sought to be avoided by the

FTCA exemption.

Boyle, 108 S. Ct. at 2517-8 (citations omitted). By mak-

ing government “approval” equivalent to exercising a dis-

cretionary function under the FTCA, the Trevino court

13

has undermined this Court’s effort to limit judicial inter-

ference in the military procurement proces. The degree

of scrutiny required by the Fifth Circuit of a trier of

fact to “locate the actual exercise of the discretionary

function” * and determine whether it “involve[s] the use

of policy judgment,” * will invariably result in the same

kind of excessive judicial investigation and evaluation of

military decisions this Court tried to avoid in Boyle.

The confusing status of discretionary function case

law *® only exacerbates this concern. Due in part to in-

frequent Supreme Court review,”* the lower courts have

23 Trevino, 865 F.2d at 1480.

24 Td.

23In United States v. S.A. Empresa de Viacao Aerea Rio

Grandense (Varig Airlines), 467 U.S. 797, 811 (1984), the Court

acknowledged that the discretionary function exception “admittedly

has not followed a straight line.”

26 This Court has reviewed only three discretionary function

cases since 1953, and in each has broadly defined the scope of

government activity that falls within the discretionary function

exception to the FTCA. See Dalehite v. United States, 346 U.S. 15,

35-36 (1953) (“determinations made by executives or administra-

tors in establishing plans, specifications or schedules of operations

fall within the discretionary function exception .... Where there

is room for policy judgment and decision there is discretion.’’) ;

Varig Airlines, 467 U.S. 797, 813 (1984) (“it is the nature of the

conduct, rather than the status of the actor, that governs whether

the discretionary function exception applies in a given case... .

Thus, the basic inquiry concerning the application of the discretion-

ary functon exception is whether the challenged acts of a Gov-

ernment employee—whatever his or her rank—are of the nature

and quality that Congress intended to shield from tort liability.”) ;

Berkovitz v. United States, U.S. ——, 56 U.S.L.W. 4549, 4551

(U.S. June 14, 1988) (“The discretionary function exception ap-

plies only to conduct that involves the permissible exercise of policy

judgment.”’).

14

continued to develop vague ”’ and inconsistent tests ** for

determining what constitutes a discretionary function

under the FTCA. This Court should grant the Petition

for a Writ of Certiorari to prevent the Trevino decision

from subjecting the “approval” element of the govern-

ment contractor defense to the same kind of confusion.

II. A Simple Yearsley-type Test For Government “Ap-

proval” Would Minimize Judicial Scrutiny Of Military

Decisions And Add Certainty to the Government Con-

tractor Defense.

The implications of the Trevino court’s requirement

that government “approval” of design specifications

“must constitute a discretionary function,” are dis-

turbing as a matter of policy as well as practice. Not

only does the Fifth Circuit subvert this Court’s efforts

to protect military decisionmaking from undue judicial

scrutiny, but it also substantially eliminates the certainty

Boyle provided to the scope of contractor immunity from

state tort liability.

27 See Allen v. United States, 816 F.2d 1417, 1420 (10th Cir.

1987), cert. denied, 108 S. Ct. 694 (1988) (“The key term, ‘discre-

tionary function,’ is not defined. For over thirty-five years the

federal courts have been attempting to define it.” Accord Dube v.

Pittsburgh-Corning, Civil No. 83-0224 P, 1988 U.S. Dist. Lexis

5739 (D. Me. June 9, 1988) (“Indeed, having reviewed scores of

cases—and the multitude of cases litigated on the topic is itself a

demonstration of the inadequacy of prior pronouncement—I con-

clude that no principled distinction has yet been articulated.”) ;

Blessing v. United States, 447 F. Supp. 1160, 1167 (E.D. Pa. 1978)

(“Rather than a seamless web, however, we found the law in this

area to be a patchwork quilt.”).

28 Compare ¢é.g., “susceptible of discretion” analysis applied in

Dube v. Pittsburgh-Corning, 870 F.2d 790 (1st Cir. 1989), petition

for reh’g denied (May 23, 1989) with “traditionally governmental”

activity analysis applied in Smith v. Johns-Manville Corp., 795

F.2d 301 (3rd Cir. 1986).

29 Trevino, 865 F.2d at 1480.

15

As a practical matter, unless reversed, Trevino will

undermine contractor confidence in the Boyle defense.

This, in turn, may discourage government contractors

from competing for essential military projects. At the

very least, Trevino will encourage unnecessary increases

in procurement and insurance costs. From a public policy

standpoint, the Fifth Circuit’s decision underscores the

ineffectiveness of complex tests for determining contrac-

tor liability. A less complex test for determining govern-

ment “approval,” like the Yearsley test discussed below,

would substantially minimize judicial inquiry into mili-

tary decisionmaking and add certainty to the scope of the

government contractor defense.

A. Determining The Nature And Use To Which A

Product Is Put Requires No Judicial Intrusion Into

Military Decisionmaking.

The unnecessary complexity of the Fifth Circuit’s defi-

nition of what constitutes government “approval” under

Boyle could have been avoided had this Court adopted a

simple test for government contractor immunity similar

to the one applied in Yearsley v. W. A. Ross Construction

Co., 309 U.S. 18 (1940). In Yearsley, the Court ruled

that a contractor was not liable for damages caused when

the construction work it performed for the government

on the Missouri River eroded part of the petitioner’s land.

The Yearsley Court held that if the authority to carry

out the project is within the constitutional power of Con-

gress, “there is no liability on the part of the contractor

for executing its will.” Yearsley, 309 U.S. at 20-21.

The Chamber proposed the adoption of a “Yearsley-

type” defense as amicus curiae in Boyle. While the Boyle

Court did cite Yearsley as being the closest it had ever

come to accepting the government contractor defense as

a matter of federal common law,* it chose instead to

adopt a three-part version of the government contractor

30 Boyle at 2514.

16

defense applied by the Ninth Circuit in McKay v. Rock-

well International Corp., 704 F.2d 444 (9th Cir. 1983),

cert. denied, 462 U.S. 1048 (1984). As amicus curiae

here, the Chamber re-emphasizes the merits of a Yearsley

approach to government contractor liability and urges

the Court to consider a Yearsley-type analysis for deter-

mining governmental “approval” under the first prong

of the Boyle test.

Grounded in the notion that a government contractor

ought to be protected from liability if it is performing at

the behest of the government, a Yearsley-type “approval”

test would prevent courts from engaging in the degree

of unbounded scrutiny of government participation in

military product design required under Trevino. Under

a Yearsley-type “approval” test, the judiciary need only

determine (1) the nature of the product and (2) the use

to which it was put. Absent fraud by the contractor in

the procurement process, the contractor would be pro-

tected from tort liability for “uniquely military” prod-

ucts fhat were put to “military use.” “Uniquely mili-

tary’ ’ products include those products that were specially

designed and produced for the military as well as com-

mercial products that were put to military purposes or

materially altered for military use. Commercial products

supplied to the military, as is, and used for a purpose

not uniquely military would fail a Yearsley-type “ap-

proval” test. Hence, determining whether a product is

military or commercial is comparatively simple and re-

quires no intrusion by the courts into military decision-

making.

Similarly, evidence that a product was put to a “mili-

tary use” can be proved in several ways, none of which

require the judiciary to second-guess government pro-

curement decisions. The contractor can meet its burden

of proof simply through (1) government testimony in

court that the goods were acceptabie; (2) government

affidavit attesting the product’s use; or (3) evidence, as

17

in the case at bar, that the goods were placed in service

and successfully used for their intended services. Proof

of any one of these would demonstrate that the govern-

ment received the product it desired and found it accept-

able. This type of evidentiary test renders unnecessary

the kind of judicial second-guesing required by Trevino

as to whether the government conducted a “substantive

review and evaluation * and exercised its discretion “over

significant details and all critical design choices.” Jd. at

1481.

B. A Yearsley-type Test Advances The Separation Of

Powers Principles Which Are At The Heart Of The

Boyle Defense.

Judicial and civ.jian scrutiny of the “[d]ifficult choices,

tradeoff, and cumpromises inheve[nt] in military plan-

ning that simply find no analogue in civilian life,” ** vio-

late the separation of powers principles from which both

the Boyle defense and the discretionary function excep-

tion evolved. As discussed above, this Court intended the

Boyle defense to safeguard the notion that the judiciary

refrain from second-guessing military decisionmaking:

[t]he selection of the appropriate design for military

equipment .. . involves not merely engineering anal-

ysis but judgment as to the balancing of many

technical, military, and even social considerations,

including, specifically the trade-off between greater

safety and greater combat effectiveness. 108 S. Ct.

at 2717.

The government “approval” test imposed by Trevino

undermines the very policy Boyle hoped to enforce. A

Yearsley-type test for determining government “ap-

proval” would preserve the purpose of these principles

by precluding suits by servicemen and civilians against

the contractor who is doing work for the government.

81 Trevino, 865 F.2d at 1480.

82 Tozer V. LTV Corp., 792 F.2d 403, 406 (4th Cir. 1986).

18

CONCLUSION

For the reasons stated above, the Chamber of Com-

merce of the United States of America respectfully urges

this Court to grant the Petition for a Writ of Certiorari.

Respectfully submitted,

ROBIN S. CONRAD

Counsel of Record

NATIONAL CHAMBER LITIGATION

CENTER, INC.

1615 H Street, N.W.

Washington, D.C. 20062

(202) 463-5337

Counsel for the Amicus Curiae

Chamber of Commerce of the

October 2, 1989 United States

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