Component Parts Manufacturers in the Cross Hairs

Over the last 20 years, plaintiffs have bankrupted many major manufacturers of asbestos and asbestos-containing products. As a result, for the last several years, plaintiffs allegedly injured by asbestos exposure have targeted manufacturers of pumps, valves and other equipment, claiming that asbestos-containing insulation used in and around those products has injured them. These suits have resurrected a long-simmering dispute over the scope and application of the component parts doctrine to shield parts manufacturers from liability for harms caused by the finished product into which their non-defective parts are placed.

A Cluster of Cases

A cluster of asbestos-related cases decided in 2009 has resulted in a trilogy of appellate decisions that reveals the key issues that arise in defending parts manufacturers from liability for components manufactured by others. Taylor v. Elliott Turbomachinery Co., Inc., O'Neil v. Crane Co., and Merrill v. Leslie Controls share many common or similar facts. All three plaintiffs worked on Navy vessels in the 1960s and/or 1970s, repairing, maintaining and overseeing engine room equipment. In the course of that work, each plaintiff was exposed to asbestos-containing insulation, packing and gaskets that had been used in pumps, valves and tanks originally designed, manufactured and sold by the defendants. In each case, the asbestos-containing materials to which plaintiffs were exposed were manufactured by non-defendant third parties. Two of the three resulting decisions rejected plaintiffs' efforts to impose liability on manufacturers of engine room equipment for asbestos-containing insulation manufactured by others used in their equipment. The third court found differently, concluding that a pump or valve manufacturer can be liable for injuries sustained as a result of the use of asbestos-containing replacement insulation in their equipment, even though the equipment manufacturer did not design, manufacture or install said insulation.

While it is easy to understand how a court could sympathize with military service members who contracted mesothelioma as a result of the conditions under which they served, imposing liability for those injuries on the manufacturers of non-defective components or equipment is not the answer. If uncorrected, the expansive reasoning adopted by one district of the California Court of Appeals could have damaging and unfair consequences across a wide range of industries.

Taylor v. Elliott Turbomachinery Co.

In Taylor v. Elliott Turbomachinery Co., Inc., 171 Cal. App. 4th 564, 597 (2009), review denied (June 10, 2009), the First District of the California Court of Appeal affirmed a trial court order granting defendants' motion for summary judgment, finding that defendants were not strictly liable for plaintiff's injuries on a failure to warn theory. The plaintiff was a Navy machinist's mate aboard the USS Hornet. Taylor's job was to replace the insulation on and inside the engine room components. This required that he open up a valve or pump, for example, and chip, brush or otherwise remove baked-on asbestos-containing materials. Ventilation was sparse in windowless engine rooms. This process allegedly released a significant amount of asbestos-containing dust, which Taylor inhaled. Eventually, he developed mesothelioma.

His widow brought strict liability and negligence claims against valve, pump and tank manufacturers, alleging that they failed to warn her husband about the dangers of his exposure to asbestos in the insulation used in engine-room parts. In opposition to the defendants' motion for summary judgment, Mrs. Taylor showed that the defendants had supplied Taylor's vessel with valves, pumps and deaerating tanks that had either contained or been covered with asbestos-containing insulation. However, before Taylor arrived on board the ship, the components of its engine room, including the valves, pumps and tanks manufactured by the defendants, had undergone at least three complete overhauls. None of the original insulating material remained by the time he began work on the Hornet. None of the replacement asbestos-containing gaskets, insulation or packing to which Taylor was exposed were manufactured by the defendants.

Despite construing this evidence liberally in Mrs. Taylor's favor, the appellate court found that the defendants were not liable for failing to warn her husband of the dangers of asbestos-containing products they had not designed, manufactured or installed in their pumps, valves and tanks. The appellate court reasoned that the defendants were not in the stream of commerce for the replacement gaskets, insulation and packing used with their equipment. They had not reaped financial benefit from the sale of these replacement parts, had no continuing business relationship with the gasket and other parts manufacturers, and could not exert pressure on those manufacturers to produce safer products. Thus, the pump, valve and tank manufacturers had neither a basis to know what replacement insulation was being used, nor a basis to suggest the use of a safer product.

The court further rejected the plaintiffs' argument that a manufacturer can be liable for harm arising from the foreseeable use of its product, where the hazard arises from the combination of that product and a product manufactured by another. Instead, the court ruled that a duty to warn “arises only when the manufacturer's own product causes or creates the risk of harm.“ 171 Cal. App. 4th at 580 (emphasis added). This ruling expresses the component parts doctrine, which precludes liability for a parts manufacturer for injuries caused by the finished product into which the component is integrated unless the component part itself is defective when it leaves its manufacturer. Applying that principle to the facts in evidence, the court found that the “product“ to be analyzed in Taylor's case was the “marine steam propulsion system“ of which defendants' valves, pumps and tanks were component parts. The plaintiff argued that the “products“ in question were the valves, pumps and tanks themselves, of which asbestos-containing insulation was a component. The court's rejection of this argument is common sense. While they are finished pieces of equipment, pumps and valves have no independent use or purpose. They must be combined with other parts to create a functional system or product. In that regard, they fall within the common definition of a component: “a constituent part,“ “element“ or “ingredient“ of a larger whole. Cardiac Pacemakers, Inc. v. St. Jude Medical, Inc., 576 F.3d 1348 (Fed. Cir. 2009) (citing Webster's Third New International Dictionary 266 (1986)); Legge v. Nucor Steel Marion, Inc., 2008 WL 5083145 at *2 (N.D. Ohio Nov. 25, 2008).

The court also expressly rejected the idea that the defendants could be liable because it was foreseeable that the finished product ' the ship's engine system ' would require asbestos-containing insulation to be used, even if not the same insulation originally provided by the parts manufacturer. “Foreseeability alone is not sufficient to justify the imposition of a duty to warn [of the risks of the finished product] on the manufacturer of a component part.“ 171 Cal. App. 4th at 586.

O'Neil v. Crane Co.

Seven months after Taylor was decided, the Second District of the California appellate court came to the opposite conclusion in O'Neil v. Crane Co., No. B208225, 2009 WL 2973657 (Cal. App. Sept. 18, 2009), petition for reh'g denied (Oct. 16, 2009), vacated pending review, S177401 (Oct. 23, 2009). While this decision has been vacated pending California Supreme Court review, it illuminates some of the key issues involved in defending component parts cases.

Patrick Neil was a Navy officer who died of mesothelioma 40 years after serving onboard the aircraft carrier USS Oriskany. Like Taylor, O'Neil worked in boiler and engine rooms, supervising the repair and maintenance of valves, pumps, flanges and fittings. The defendant provided valves using an asbestos-containing packing material, which Crane purportedly specified for use. Crane pumps were designed to be used with asbestos-containing gasket insulation supplied by a non-party. In the course of removing and replacing this packing and insulation, the plaintiff inhaled asbestos that allegedly led to his disease.

Crane's equipment was accompanied by instruction manuals that discussed anticipated repairs and maintenance and provided safety precautions ' but no warnings about asbestos. By the 1980s, some gasket manufacturers were addressing the health hazards of asbestos with the Navy, but Crane's manuals did not incorporate a related warning. Further, the evidence suggested that while the Navy provided broad, overall specifications for its engine components, the specific design of the pumps and valves in question, and their use of asbestos-containing insulation, was left up to Crane.

Breaking with Taylor's analysis, the O'Neil court concluded that the Crane pumps and valves were “products“ in and of themselves, not component parts of a larger product or system. “We ' disagree with the [Taylor] finding that the entire steam system of an aircraft carrier ' is a 'finished product' ' . Such a broad definition would make the analysis unworkable.“ 2009 WL 2973657 at *7.

The court reasoned that component parts are multi-use or fungible elements, designed to be incorporated into another product, which “will be substantially altered by the customer“ in the process. Id. at *6. To this court, pumps and valves were “separate products with a specific purpose and use,“ designed to be used as they were used, “with asbestos insulation and packing which would have to be removed during routine repair and maintenance.“ Id. Because defendant's goods were finished products, the component parts doctrine did not apply. Moreover, the court found that the performance of a product during routine repair and maintenance was part of its functionality, a flaw that could render the product defective. Moving past asbestos-containing insulation, the court opined, “A car which only exploded when the oil was changed or the tires [were] rotated could not be deemed non-defective.“

Because O'Neil concluded that Crane's pumps and valves were finished products, their incorporation of allegedly defective asbestos-containing components rendered them defective as well. “[A] manufacturer is liable in strict liability for the dangerous components of its products and for dangerous products with which its product will necessarily be used.“ 2009 WL 2973657 at *10. Because the use of asbestos in Crane's products was “not happenstance ' it was design,“ Crane was responsible for any injuries caused by the asbestos-containing insulation it used and for any replacement insulation, even that manufactured by non-defendants. Id. at 11.

Merrill v. Leslie Controls, Inc.

Just a week after O'Neil was decided, a different division of the Second District of the California Court of Appeal issued an opinion supporting Taylor and conflicting with O'Neil. In Merrill v. Leslie Controls, Inc., 179 Cal. App. 4th 262 (Cal. App. 2009), petition for review granted (Feb. 3, 2010), the appellate court reversed a judgment in favor of a 20-year Navy machinist mate and fireman apprentice for alleged asbestos-related injuries. Before the verdict, plaintiff settled with 16 defendants for over $5.5 million. Of the remaining defendants, only Leslie Controls was found liable.

Leslie Controls sold valves to the Navy that contained asbestos-containing insulation as well as replacement gaskets and packing for those valves. Leslie Control's manuals instructed customers to insulate all pipes, though it did not designate or provide a particular type of insulation. The defendants' personnel were present when its valves were opened, insulation removed and replaced, and the valve was reinstalled. They were, therefore, aware that asbestos-containing insulation was being used in Leslie Controls' valves. In the course of maintaining and repairing the defendant's valves, Merrill was allegedly exposed to asbestos in internal valve packing and gaskets, in flange gaskets on the exterior of the valves, and in insulation pads covering the valves.

Despite this evidence, the court concluded that Leslie Controls was not liable for Merrill's exposure to asbestos from any of these sources. Reverting to Taylor's reasoning, the Merrill court found that the defendant could not be liable for the plaintiff's injury because the “product“ in question was “a larger steam production system for naval ships“ that Leslie Controls did not design. 2009 WL 3051534 at *10. Further, Leslie Controls did not design, manufacture, supply or install the specific gaskets, or provide the specific external insulation containing asbestos, to which the plaintiff was exposed. Because defendant did not manufacture or sell the actual injury-causing insulation or gaskets, it could not be liable.

As in Taylor, Merrill argued that the defendant had a duty to warn of “all foreseeable hazards associated with its valves, including those arising from asbestos-containing products which Leslie Controls did not supply but which were used in association with its valves.“ 2009 WL 3051534 at *7. The court made short work of this argument, concluding that “a manufacturer is not liable for failing to warn of a possible defect in the product of another.“ Id.

Implications

As this trilogy of cases reflects, different districts and divisions of the California appellate court are free to reach different conclusions on the basis of the same law and essentially identical facts. Jessen v. Mentor Corp., 158 Cal. App. 4th 1480, 1490 n.10 (Cal. App. 2008), petition for reh'g denied, Feb. 6, 2008. Fortunately, the California Supreme Court has granted review in O'Neil and Merrill, which should eliminate the confusion and inconsistency the appellate opinions in those cases has created.

These cases are worth watching closely. In the last year, California plaintiffs have won multiple jury verdicts in cases stemming from the same basic fact pattern as Taylor, O'Neil and Merrill in Los Angeles County Superior Courts alone. See, e.g., Shahabi v. A.W. Chesterton Co., No. B211759 (Superior Court, Los Angeles County, Aug. 14, 2008) ($14.8 million verdict for plaintiff, appeal pending); Brewer v. Crane Co., No. B213096 (Superior Court, Los Angeles County, May, 2008) ($9.7 million verdict, appeal pending); Haupt v. S.C.L.A., No. B207750 (Superior Court, Los Angeles County, April 21, 2009) ($1.4 million verdict, petition for writ denied). A California Supreme Court decision could strongly influence whether similar cases are successfully defended.

More broadly, the O'Neil decision is worrisome for all product manufacturers because of its definitions of a “product“ and a “component.“ The court's conclusion that “components“ are constituents that will be altered by their inclusion in a larger product stretches both the law and reality of how products function. Many constituent parts of products are not altered by their use in a larger product and yet remain components ' screws, wiring, gears and blades, just to name a few. If alteration of the part is a test for genuine components, the component parts doctrine will apply in few cases.

For the reasons articulated by many California appellate and trial courts, it is inequitable, legally unfounded and disruptive to commerce to hold one parts manufacturer liable for the defects in another parts manufacturer's component, over which the first manufacturer has no control. O'Neil distorts strict product liability beyond recognizable bounds. One can only hope that the California Supreme Court will overrule O'Neil defintively.

Sarah (“Sally“) L. Olson, a member of this newsletter's Board of Editors, is a partner in the Litigation Department of Wildman, Harrold, Allen & Dixon, LLP, in Chicago, where she is a Litigation Practice Group Leader, and the Chair of the firm's Diversity Committee. Ms. Olson represents manufacturing companies and, through trade associations, industries facing litigation, legislative change, or regulatory action in relation to the design, manufacture, marketing, and distribution of their products.

Over the last 20 years, plaintiffs have bankrupted many major manufacturers of asbestos and asbestos-containing products. As a result, for the last several years, plaintiffs allegedly injured by asbestos exposure have targeted manufacturers of pumps, valves and other equipment, claiming that asbestos-containing insulation used in and around those products has injured them. These suits have resurrected a long-simmering dispute over the scope and application of the component parts doctrine to shield parts manufacturers from liability for harms caused by the finished product into which their non-defective parts are placed.

A Cluster of Cases

A cluster of asbestos-related cases decided in 2009 has resulted in a trilogy of appellate decisions that reveals the key issues that arise in defending parts manufacturers from liability for components manufactured by others. Taylor v. Elliott Turbomachinery Co., Inc., O'Neil v. Crane Co. , and Merrill v. Leslie Controls share many common or similar facts. All three plaintiffs worked on Navy vessels in the 1960s and/or 1970s, repairing, maintaining and overseeing engine room equipment. In the course of that work, each plaintiff was exposed to asbestos-containing insulation, packing and gaskets that had been used in pumps, valves and tanks originally designed, manufactured and sold by the defendants. In each case, the asbestos-containing materials to which plaintiffs were exposed were manufactured by non-defendant third parties. Two of the three resulting decisions rejected plaintiffs' efforts to impose liability on manufacturers of engine room equipment for asbestos-containing insulation manufactured by others used in their equipment. The third court found differently, concluding that a pump or valve manufacturer can be liable for injuries sustained as a result of the use of asbestos-containing replacement insulation in their equipment, even though the equipment manufacturer did not design, manufacture or install said insulation.

While it is easy to understand how a court could sympathize with military service members who contracted mesothelioma as a result of the conditions under which they served, imposing liability for those injuries on the manufacturers of non-defective components or equipment is not the answer. If uncorrected, the expansive reasoning adopted by one district of the California Court of Appeals could have damaging and unfair consequences across a wide range of industries.

Taylor v. Elliott Turbomachinery Co.

In Taylor v. Elliott Turbomachinery Co., Inc. , 171 Cal. App. 4th 564, 597 (2009), review denied (June 10, 2009), the First District of the California Court of Appeal affirmed a trial court order granting defendants' motion for summary judgment, finding that defendants were not strictly liable for plaintiff's injuries on a failure to warn theory. The plaintiff was a Navy machinist's mate aboard the USS Hornet. Taylor's job was to replace the insulation on and inside the engine room components. This required that he open up a valve or pump, for example, and chip, brush or otherwise remove baked-on asbestos-containing materials. Ventilation was sparse in windowless engine rooms. This process allegedly released a significant amount of asbestos-containing dust, which Taylor inhaled. Eventually, he developed mesothelioma.

His widow brought strict liability and negligence claims against valve, pump and tank manufacturers, alleging that they failed to warn her husband about the dangers of his exposure to asbestos in the insulation used in engine-room parts. In opposition to the defendants' motion for summary judgment, Mrs. Taylor showed that the defendants had supplied Taylor's vessel with valves, pumps and deaerating tanks that had either contained or been covered with asbestos-containing insulation. However, before Taylor arrived on board the ship, the components of its engine room, including the valves, pumps and tanks manufactured by the defendants, had undergone at least three complete overhauls. None of the original insulating material remained by the time he began work on the Hornet. None of the replacement asbestos-containing gaskets, insulation or packing to which Taylor was exposed were manufactured by the defendants.

Despite construing this evidence liberally in Mrs. Taylor's favor, the appellate court found that the defendants were not liable for failing to warn her husband of the dangers of asbestos-containing products they had not designed, manufactured or installed in their pumps, valves and tanks. The appellate court reasoned that the defendants were not in the stream of commerce for the replacement gaskets, insulation and packing used with their equipment. They had not reaped financial benefit from the sale of these replacement parts, had no continuing business relationship with the gasket and other parts manufacturers, and could not exert pressure on those manufacturers to produce safer products. Thus, the pump, valve and tank manufacturers had neither a basis to know what replacement insulation was being used, nor a basis to suggest the use of a safer product.

The court further rejected the plaintiffs' argument that a manufacturer can be liable for harm arising from the foreseeable use of its product, where the hazard arises from the combination of that product and a product manufactured by another. Instead, the court ruled that a duty to warn “arises only when the manufacturer's own product causes or creates the risk of harm.“ 171 Cal. App. 4th at 580 (emphasis added). This ruling expresses the component parts doctrine, which precludes liability for a parts manufacturer for injuries caused by the finished product into which the component is integrated unless the component part itself is defective when it leaves its manufacturer. Applying that principle to the facts in evidence, the court found that the “product“ to be analyzed in Taylor's case was the “marine steam propulsion system“ of which defendants' valves, pumps and tanks were component parts. The plaintiff argued that the “products“ in question were the valves, pumps and tanks themselves, of which asbestos-containing insulation was a component. The court's rejection of this argument is common sense. While they are finished pieces of equipment, pumps and valves have no independent use or purpose. They must be combined with other parts to create a functional system or product. In that regard, they fall within the common definition of a component: “a constituent part,“ “element“ or “ingredient“ of a larger whole. Cardiac Pacemakers, Inc. v. St. Jude Medical, Inc. , 576 F.3d 1348 (Fed. Cir. 2009) (citing Webster's Third New International Dictionary 266 (1986)); Legge v. Nucor Steel Marion, Inc., 2008 WL 5083145 at *2 (N.D. Ohio Nov. 25, 2008).

The court also expressly rejected the idea that the defendants could be liable because it was foreseeable that the finished product ' the ship's engine system ' would require asbestos-containing insulation to be used, even if not the same insulation originally provided by the parts manufacturer. “Foreseeability alone is not sufficient to justify the imposition of a duty to warn [of the risks of the finished product] on the manufacturer of a component part.“ 171 Cal. App. 4th at 586.

O'Neil v. Crane Co.

Seven months after Taylor was decided, the Second District of the California appellate court came to the opposite conclusion in O'Neil v. Crane Co. , No. B208225, 2009 WL 2973657 (Cal. App. Sept. 18, 2009), petition for reh'g denied (Oct. 16, 2009), vacated pending review, S177401 (Oct. 23, 2009). While this decision has been vacated pending California Supreme Court review, it illuminates some of the key issues involved in defending component parts cases.

Patrick Neil was a Navy officer who died of mesothelioma 40 years after serving onboard the aircraft carrier USS Oriskany. Like Taylor, O'Neil worked in boiler and engine rooms, supervising the repair and maintenance of valves, pumps, flanges and fittings. The defendant provided valves using an asbestos-containing packing material, which Crane purportedly specified for use. Crane pumps were designed to be used with asbestos-containing gasket insulation supplied by a non-party. In the course of removing and replacing this packing and insulation, the plaintiff inhaled asbestos that allegedly led to his disease.

Crane's equipment was accompanied by instruction manuals that discussed anticipated repairs and maintenance and provided safety precautions ' but no warnings about asbestos. By the 1980s, some gasket manufacturers were addressing the health hazards of asbestos with the Navy, but Crane's manuals did not incorporate a related warning. Further, the evidence suggested that while the Navy provided broad, overall specifications for its engine components, the specific design of the pumps and valves in question, and their use of asbestos-containing insulation, was left up to Crane.

Breaking with Taylor's analysis, the O'Neil court concluded that the Crane pumps and valves were “products“ in and of themselves, not component parts of a larger product or system. “We ' disagree with the [Taylor] finding that the entire steam system of an aircraft carrier ' is a 'finished product' ' . Such a broad definition would make the analysis unworkable.“ 2009 WL 2973657 at *7.

The court reasoned that component parts are multi-use or fungible elements, designed to be incorporated into another product, which “will be substantially altered by the customer“ in the process. Id. at *6. To this court, pumps and valves were “separate products with a specific purpose and use,“ designed to be used as they were used, “with asbestos insulation and packing which would have to be removed during routine repair and maintenance.“ Id. Because defendant's goods were finished products, the component parts doctrine did not apply. Moreover, the court found that the performance of a product during routine repair and maintenance was part of its functionality, a flaw that could render the product defective. Moving past asbestos-containing insulation, the court opined, “A car which only exploded when the oil was changed or the tires [were] rotated could not be deemed non-defective.“

Because O'Neil concluded that Crane's pumps and valves were finished products, their incorporation of allegedly defective asbestos-containing components rendered them defective as well. “[A] manufacturer is liable in strict liability for the dangerous components of its products and for dangerous products with which its product will necessarily be used.“ 2009 WL 2973657 at *10. Because the use of asbestos in Crane's products was “not happenstance ' it was design,“ Crane was responsible for any injuries caused by the asbestos-containing insulation it used and for any replacement insulation, even that manufactured by non-defendants. Id. at 11.

Merrill v. Leslie Controls, Inc.

Just a week after O'Neil was decided, a different division of the Second District of the California Court of Appeal issued an opinion supporting Taylor and conflicting with O'Neil . In Merrill v. Leslie Controls, Inc. , 179 Cal. App. 4th 262 (Cal. App. 2009), petition for review granted (Feb. 3, 2010), the appellate court reversed a judgment in favor of a 20-year Navy machinist mate and fireman apprentice for alleged asbestos-related injuries. Before the verdict, plaintiff settled with 16 defendants for over $5.5 million. Of the remaining defendants, only Leslie Controls was found liable.

Leslie Controls sold valves to the Navy that contained asbestos-containing insulation as well as replacement gaskets and packing for those valves. Leslie Control's manuals instructed customers to insulate all pipes, though it did not designate or provide a particular type of insulation. The defendants' personnel were present when its valves were opened, insulation removed and replaced, and the valve was reinstalled. They were, therefore, aware that asbestos-containing insulation was being used in Leslie Controls' valves. In the course of maintaining and repairing the defendant's valves, Merrill was allegedly exposed to asbestos in internal valve packing and gaskets, in flange gaskets on the exterior of the valves, and in insulation pads covering the valves.

Despite this evidence, the court concluded that Leslie Controls was not liable for Merrill's exposure to asbestos from any of these sources. Reverting to Taylor's reasoning, the Merrill court found that the defendant could not be liable for the plaintiff's injury because the “product“ in question was “a larger steam production system for naval ships“ that Leslie Controls did not design. 2009 WL 3051534 at *10. Further, Leslie Controls did not design, manufacture, supply or install the specific gaskets, or provide the specific external insulation containing asbestos, to which the plaintiff was exposed. Because defendant did not manufacture or sell the actual injury-causing insulation or gaskets, it could not be liable.

As in Taylor, Merrill argued that the defendant had a duty to warn of “all foreseeable hazards associated with its valves, including those arising from asbestos-containing products which Leslie Controls did not supply but which were used in association with its valves.“ 2009 WL 3051534 at *7. The court made short work of this argument, concluding that “a manufacturer is not liable for failing to warn of a possible defect in the product of another.“ Id.

Implications

As this trilogy of cases reflects, different districts and divisions of the California appellate court are free to reach different conclusions on the basis of the same law and essentially identical facts. Jessen v. Mentor Corp. , 158 Cal. App. 4th 1480, 1490 n.10 (Cal. App. 2008), petition for reh ' g denied, Feb. 6, 2008. Fortunately, the California Supreme Court has granted review in O'Neil and Merrill, which should eliminate the confusion and inconsistency the appellate opinions in those cases has created.

These cases are worth watching closely. In the last year, California plaintiffs have won multiple jury verdicts in cases stemming from the same basic fact pattern as Taylor, O'Neil and Merrill in Los Angeles County Superior Courts alone. See, e.g., Shahabi v. A.W. Chesterton Co., No. B211759 (Superior Court, Los Angeles County, Aug. 14, 2008) ($14.8 million verdict for plaintiff, appeal pending); Brewer v. Crane Co. , No. B213096 (Superior Court, Los Angeles County, May, 2008) ($9.7 million verdict, appeal pending); Haupt v. S.C.L.A., No. B207750 (Superior Court, Los Angeles County, April 21, 2009) ($1.4 million verdict, petition for writ denied). A California Supreme Court decision could strongly influence whether similar cases are successfully defended.

More broadly, the O'Neil decision is worrisome for all product manufacturers because of its definitions of a “product“ and a “component.“ The court's conclusion that “components“ are constituents that will be altered by their inclusion in a larger product stretches both the law and reality of how products function. Many constituent parts of products are not altered by their use in a larger product and yet remain components ' screws, wiring, gears and blades, just to name a few. If alteration of the part is a test for genuine components, the component parts doctrine will apply in few cases.

For the reasons articulated by many California appellate and trial courts, it is inequitable, legally unfounded and disruptive to commerce to hold one parts manufacturer liable for the defects in another parts manufacturer's component, over which the first manufacturer has no control. O'Neil distorts strict product liability beyond recognizable bounds. One can only hope that the California Supreme Court will overrule O'Neil defintively.

Sarah (“Sally“) L. Olson, a member of this newsletter's Board of Editors, is a partner in the Litigation Department of Wildman, Harrold, Allen & Dixon, LLP, in Chicago, where she is a Litigation Practice Group Leader, and the Chair of the firm's Diversity Committee. Ms. Olson represents manufacturing companies and, through trade associations, industries facing litigation, legislative change, or regulatory action in relation to the design, manufacture, marketing, and distribution of their products.