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Horvitz & Levy LLP represented The Wm. Powell Company on appeal from a judgment awarding over $5 million to a former Navy seaman who contracted lung cancer from exposure to asbestos on Navy ships. Powell manufactured and sold valves that were incorporated into the steam propulsion system of the Navy ships. Although Powell manufactured no asbestos-containing materials, it did sometimes supply asbestos-containing internal seals (gaskets and packing) with its valves when first sold to the Navy. The plaintiff in this case, however, presented no evidence that Powell manufactured or sold any of the asbestos-containing materials to which he was exposed. Nevertheless, he and his wife sued Powell, along with over 40 other companies he contended were responsible for his asbestos exposure. By the time of the jury’s verdict, the only defendant remaining was Powell. The jury found Powell 25 percent at fault and awarded economic damages of $561,861 and noneconomic damages of $20 million (plus $500,000 for loss of consortium).

In a unanimous, published decision, the California Court of Appeal (Second Appellate District, Division Four) reversed the judgment with directions to enter judgment in favor of Powell. The court concluded that Powell was not liable for the Waltons’ injuries as a matter of law because “Powell supplied none of the asbestos products to which Edward Walton was exposed, and its valves had no defect rendering Powell liable for the injuries that Walton may have sustained through exposure to asbestos products from other sources.” In reaching that conclusion, the court agreed with the First District in Taylor v. Elliot Turbomachinery Co. Inc. (2009) 171 Cal.App.4th 564, 576, which found on similar facts that suppliers of components to Navy ships had no duty to warn under strict liability because the component manufacturers were not part of the chain of distribution of the asbestos-containing products to which the plaintiff was exposed. The court also agreed with Taylor that under the policy factors set forth in Rowland v. Christian (1968) 69 Cal.2d 108, there was no negligence-based duty to warn.

The court, however, also went beyond the holding of Taylor to hold that Powell was also not liable under any design defect theory of products liability. Under section 5 of the Restatement of Torts, Products Liability, a component manufacturer is not liable under a design defect theory unless the component itself (not the finished product as a whole) has a defect that results in injury, or the manufacturer plays a material role in integrating the component into the finished product. The reason for that “component parts doctrine” is that component makers should not be required to become experts in the products manufactured by others. The maker of the finished product is in the best position to determine whether the component is suitable for a particular purpose. In this case, Powell manufactured metal valves that had no functional value until integrated into the broader propulsion and heating systems of the Navy ships. Because Powell had no role in designing the asbestos-containing gaskets and packing, or the external asbestos insulation affixed by the navy, and had no role in designing the shipboard systems into which its valves were integrated, it could not be responsible for injuries resulting from the plaintiff’s asbestos exposure.