Carol McIndoe v. Bath Iron Works Corp ( 2016 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CAROL MCINDOE, as Wrongful No. 13-56762
Death Heir, and as Successor-in-
Interest to James McIndoe, D.C. No.
Deceased; LORRAINE MCINDOE; 2:12-cv-09639-
PAULINE MCINDOE, as Legal Heirs RGK-SS
of James McIndoe, Deceased,
Plaintiffs-Appellants,
v.
HUNTINGTON INGALLS
INCORPORATED, FKA Northrop
Grumman Shipbuilding, Inc.,
Defendant,
and
BATH IRON WORKS CORPORATION,
Defendant-Appellee.
2 MCINDOE V. BATH IRON WORKS
CAROL MCINDOE, as Wrongful No. 13-56764
Death Heir, and as Successor-in-
Interest to James McIndoe, D.C. No.
Deceased; LORRAINE MCINDOE; 2:12-cv-09639-
PAULINE MCINDOE, as Legal Heirs RGK-SS
of James McIndoe, Deceased,
Plaintiffs-Appellants,
OPINION
v.
HUNTINGTON INGALLS
INCORPORATED, FKA Northrop
Grumman Shipbuilding, Inc.,
Defendant-Appellee,
and
BATH IRON WORKS CORPORATION,
Defendant.
Appeal from the United States District Court
for the Central District of California
R. Gary Klausner, District Judge, Presiding
Argued and Submitted
August 31, 2015—Pasadena, California
Filed March 31, 2016
MCINDOE V. BATH IRON WORKS 3
Before: Alex Kozinski, Diarmuid F. O’Scannlain,
and Jay S. Bybee, Circuit Judges.
Opinion by Judge O’Scannlain
SUMMARY*
Maritime Law / Asbestos Claims
The panel affirmed the district court’s summary judgment
in favor of shipbuilders on strict products liability and
negligence claims brought under federal maritime law
against companies that built naval ships aboard which James
McIndoe allegedly was exposed to asbestos.
The panel held that the two naval warships were not
“products” for the purposes of strict products liability.
On the general negligence claims, the panel held that
there was a genuine issue of fact as to whether McIndoe was
exposed to asbestos-containing materials originally installed
upon such ships, but not as to whether any such exposure was
a substantial contributing factor to his injuries.
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4 MCINDOE V. BATH IRON WORKS
COUNSEL
Richard M. Grant, Brayton Purcell LLP, Novato, California,
argued the cause and filed the briefs for the plaintiffs-
appellants. With him on the briefs was Lloyd F. LeRoy,
Brayton Purcell LLP, Novato, California.
Daniel J. Kelly, Tucker Ellis LLP, San Francisco, California,
argued the cause and filed the brief for defendant-appellee
Huntington Ingalls Incorporated.
Edward R. Hugo, Brydon Hugo & Parker, San Francisco,
California, argued the cause and filed the brief for defendant-
appellee Bath Iron Works Corporation. With him on the brief
were James C. Parker and Charles S. Park, Brydon Hugo &
Parker, San Francisco, California.
OPINION
O’SCANNLAIN, Circuit Judge:
We must decide whether two naval warships are
“products” for the purposes of strict products liability and
whether a genuine issue of fact exists as to whether asbestos-
containing materials originally installed upon such ships
caused a decedent’s injuries.
I
In the 1960s, James McIndoe served aboard two U.S.
Naval ships which contained pipe insulation made from
asbestos. From 1961–1963, he served aboard the USS Coral
Sea, an aircraft carrier built by a predecessor in interest to
MCINDOE V. BATH IRON WORKS 5
Huntington Ingalls Inc. (Huntington) and commissioned in
1947. From 1966–1967, he served aboard the USS Worden,
a guided missile cruiser built by Bath Iron Works Corporation
(Bath) and commissioned in 1963. Aboard each ship,
McIndoe was allegedly present during maintenance work
involving the removal of pipe insulation that caused asbestos
fibers to float in the air he breathed.
On September 27, 2011, McIndoe died from
complications related to mesothelioma, a form of cancer
closely associated with asbestos exposure. Plaintiffs-
Appellants are McIndoe’s legal heirs, who filed suit in
California state court against Bath and Huntington,1 arguing
that McIndoe’s exposure to asbestos-containing materials
aboard their ships contributed to his death. McIndoe’s heirs
raised design, manufacture, and failure-to-warn claims based
on theories of both strict products liability and general
negligence. The case was removed to federal district court
under 28 U.S.C. § 1442(a)(1), where Bath and Huntington
each moved for summary judgment. The district court
granted both motions on the grounds that the ships were not
products for purposes of strict liability and that the heirs
could not establish a genuine issue of material fact regarding
whether the shipbuilders were responsible for installing any
asbestos-containing insulation that caused McIndoe’s
injuries. McIndoe’s heirs timely appealed, and these cases
have been consolidated before our court.
1
The lawsuit also named a number of other defendants who are not
parties to this appeal.
6 MCINDOE V. BATH IRON WORKS
II
We review de novo a district court’s grant of summary
judgment, and, “viewing the evidence in the light most
favorable to the nonmoving party, [determine] whether there
are any genuine issues of material fact and whether the
district court correctly applied the relevant substantive law.”
Colwell v. Bannister, 763 F.3d 1060, 1065 (9th Cir. 2014)
(internal quotation marks omitted). “[T]here is no issue for
trial unless there is sufficient evidence favoring the
nonmoving party for a jury to return a verdict for that party.
If the evidence is merely colorable, or is not significantly
probative, summary judgment may be granted.” R.W. Beck
& Assocs. v. City & Borough of Sitka, 27 F.3d 1475, 1480 n.4
(9th Cir. 1994) (internal quotation marks omitted).
“Arguments based on conjecture or speculation are
insufficient . . . . ” Id.Federal maritime law—“an amalgam of traditional
common-law rules, modifications of those rules, and newly
created rules”—governs this case. E. River S.S. Corp. v.
Transamerica Delaval Inc., 476 U.S. 858, 865 (1986); see
Wallis v. Princess Cruises, Inc., 306 F.3d 827, 840 (9th Cir.
2002) (federal maritime law applies to torts that occur on
navigable water and bear a substantial relationship to
traditional maritime activity).
III
McIndoe’s heirs first argue that Bath and Huntington
should be held strictly liable for defects in materials
originally installed on the ships they built. The Supreme
Court has recognized that federal maritime law incorporates
actions for products liability, including those that sound in
MCINDOE V. BATH IRON WORKS 7
strict liability. E. River S.S. Corp., 476 U.S. at 865. The
question whether a naval warship is to be considered a
“product” in this context, however, appears to be one of first
impression for the federal courts of appeals.
When analyzing products-liability claims under maritime
law, we look to the Restatement of Torts (the
“Restatement”)—particularly the most recent Third
Restatement—for guidance. Oswalt v. Resolute Indus., Inc.,
642 F.3d 856, 860 (9th Cir. 2011); see also Saratoga Fishing
Co. v. J.M. Martinac & Co., 520 U.S. 875, 879 (1997) (citing
both Second and Third Restatements in evaluating maritime
products-liability action). The Third Restatement defines a
“product” subject to strict liability as “tangible personal
property distributed commercially for use or consumption.”
Restatement (Third) of Torts: Prods. Liab. § 19(a) (Am. Law
Inst. 1998) (emphasis added). “[O]nly when the complained-
of injury was allegedly caused by a defect in something
within this . . . definition of ‘product’ should the defendant
manufacturer or seller be strictly liable for the harm caused.”
Id. § 19 reporter’s note, cmt. a. Injuries caused by other items
are actionable only “under negligence, misrepresentation, or
some other liability theory.” Id.
By these terms, the Restatement would exclude warships
that were never “distributed commercially” from the realm of
strict products liability. This makes sense. The general aim
of strict liability is to “plac[e] responsibility on the . . . party
most able to prevent harm” caused by dangerous products and
thus to incentivize proper “design and quality control” of
such products. All Alaskan Seafoods, Inc. v. Raychem Corp.,
197 F.3d 992, 995 (9th Cir. 1999) (citing Third Restatement).
Therefore, “strict liability should be imposed on the party
best able to protect persons from hazardous equipment.” E.
8 MCINDOE V. BATH IRON WORKS
River S.S. Corp., 476 U.S. at 866. These goals would be
advanced little by imposing liability on the builder of a
custom-ordered naval ship. As evidence submitted in this
case suggests, a ship built under government contract2 may
not even be designed by the builder but instead by the
government itself or another outside professional. Further,
the shipbuilder does not manufacture—and has little ability
to control the quality of—the many thousands of component
parts installed on each ship, let alone to account in its pricing
for the virtually unlimited liability that would flow from a
rule holding it strictly liable for their dangers. We do not
believe that federal maritime law—the primary goal of which
is to protect and to promote the “smooth flow of maritime
commerce,” Foremost Ins. Co. v. Richardson, 457 U.S. 668,
674–76 (1982)—would countenance such a sweeping grant
of liability. See generally Mack v. Gen. Elec. Co., 896 F.
Supp. 2d 333, 344–46 (E.D. Pa. 2012) (discussing principles
of strict liability and maritime law).
We therefore agree with the district court that McIndoe’s
heirs cannot sustain an action for strict products liability
premised upon the notion that the warships in question are
2
McIndoe’s heirs do not dispute that Bath and Huntington built the
relevant ships pursuant to government contract.
MCINDOE V. BATH IRON WORKS 9
themselves “products” under maritime law.3 Accordingly, the
heirs may prevail only under a theory of negligence.
IV
We turn to the heirs’ general negligence claims. To
prevail on such claims, they must demonstrate, among other
things, that McIndoe’s injuries were caused by exposure to
asbestos that was attributable to the shipbuilders’ conduct.
To do so, McIndoe’s heirs must be able to show both that he
was actually exposed to asbestos-containing materials that
were installed by the shipbuilders and that such exposure was
a substantial contributing factor in causing his injuries.
Lindstrom v. A-C Prod. Liab. Tr., 424 F.3d 488, 492 (6th Cir.
2005). We examine each requirement in turn.
A
First, McIndoe’s heirs must show that he was exposed to
asbestos from materials that Bath or Huntington installed
aboard the Coral Sea and Worden. The heirs do not claim
3
We express no opinion on the circumstances under which a
commercially distributed or mass-produced vessel would qualify as a
“product” under maritime law. McIndoe’s heirs cite cases in which the
manufacturers of such vessels have been held strictly liable for their flaws.
But such vessels enter the general stream of commerce in a way custom-
built vessels do not, and thus the cases cited say little for the standards that
should govern liability for the naval shipbuilders at issue here. See
generally Restatement (Third) of Torts: Prods. Liab. § 19 cmt. e. (Am.
Law Inst. 1998) (distinguishing pre-fabricated or mass-produced homes
from those which are built and sold “one house at a time”); see also Stark
v. Armstrong World Indus., Inc., 21 F. App’x 371, 378 n.6 (6th Cir. Oct.
3, 2001) (“[Custom-built] vessels resemble custom-designed houses,
which are also not likely to be considered ‘products’ under the
Restatement.”).
10 MCINDOE V. BATH IRON WORKS
that the shipbuilders were responsible for replacing or
maintaining such insulation after the ships were
commissioned. Therefore, they must show exposure to
asbestos from materials that were originally installed aboard
the ships. The heirs seek to demonstrate McIndoe’s asbestos
exposure through the first-hand observations of two lay
witnesses and, based on these observations, the opinion of
one purported expert.
Regarding the USS Coral Sea (built by Huntington and
commissioned in 1947), McIndoe’s heirs offered a
declaration of Brian Tench, who boarded the ship as an
ensign in 1961 and spent significant time with McIndoe in
engineering spaces of the ship. Tench testified that there
were insulated steam pipes throughout the engineering spaces
in which he worked with McIndoe; that “[b]ased on his
training and experience,” he knew such insulation contained
asbestos;4 that, he saw McIndoe in the area of others
removing asbestos-containing insulation on 20–30 different
occasions; and that the removal of the insulation created
“large amounts of visible dust” in the air McIndoe breathed.
Tench states that he knows some of the removed pipe
insulation was original to the ship because he could tell from
the thickness of the paint on the insulation that it had been
painted 6–8 times, indicating to him that it must have been
aboard the ship for some time.
4
It is not clear from Tench’s declaration how he obtained this
knowledge, other than his conclusory statements that he came to learn it.
And there is some reason to doubt that Tench’s knowledge could be
established at trial, given his statement that he relied at least partly on
statements of others who said that the insulation contained asbestos.
MCINDOE V. BATH IRON WORKS 11
Regarding the USS Worden (built by Bath and
commissioned in 1963), McIndoe’s heirs offered a
declaration of Thomas Sappington, who boarded the ship in
1964 and worked for two years in one of the ship’s fire
rooms. Sappington declared that there were thousands of feet
of insulated pipe in the fire rooms; that McIndoe was “often”
present when maintenance was performed, which involved
the removal of pipe insulation; and that the process of
removing the insulation created visible dust in the air
McIndoe breathed. Much like Tench, Sappington declared
that he could distinguish the ship’s original pipe insulation
from later-installed replacement insulation based on visible
seams between new and old insulation and on variances in the
thickness of their paint,5 and that he believes much of the
insulation removed in McIndoe’s presence was original to the
ship.
McIndoe’s heirs built upon these accounts through the
declaration of Charles Ay, a professional asbestos consultant
who worked aboard hundreds of naval ships as a pipe
insulator in the 1960s–1980s. Ay stated that, based on his
experience, he knew that insulation used on high-pressure
pipelines in Naval ships built in the 1940s–1960s always
contained asbestos; that nearly half of all originally installed
insulation aboard such vessels was not removed during the
life of the ship; that during McIndoe’s time aboard the Coral
Sea, at least 70 percent of the original asbestos-containing
insulation would have remained; that during McIndoe’s time
aboard the Worden, “virtually all” of the original insulation
would have remained; and that he personally saw thousands
5
Like Tench, Sappington also refers to statements of others who told
him which sections of insulation had been replaced and which were
original.
12 MCINDOE V. BATH IRON WORKS
of lineal feet of asbestos-containing pipe insulation while
working as an insulator aboard each ship (in the mid-1960s
on the Worden and the 1970s on the Coral Sea). Based on his
experience and the statements of Tench and Sappington, Ay
concluded that it is “virtually impossible” that McIndoe
would have avoided being exposed to asbestos dust from
original insulation during his time aboard each ship.
We agree with the district court that the evidence that
McIndoe was exposed to asbestos originally installed by the
shipbuilders is not especially strong. The only direct
evidence presented to support the claim that such insulation
was removed in McIndoe’s presence is the rather implausible
testimony of Tench and Sappington that, nearly 50 years
later, they recall the thickness of the paint on the removed
insulation to such a degree that they can surmise the age of
the insulation. To these direct accounts, Ay can add only his
speculation as to what materials a person in McIndoe’s
position would have encountered, with no actual knowledge
of McIndoe’s activities aboard the ships. Nevertheless,
viewing these statements in the light most favorable to the
plaintiffs, Colwell, 763 F.3d at 1065, we conclude that a jury
could determine that McIndoe was exposed to originally
installed asbestos, even if it seems unlikely that a jury would
do so. Such evidence therefore creates a genuine issue of fact
regarding whether McIndoe was at least exposed to asbestos
from the shipbuilders’ materials.
B
But even if the evidence may establish that McIndoe was
actually exposed to asbestos installed by the shipbuilders, his
heirs still must show that any such exposure was a substantial
MCINDOE V. BATH IRON WORKS 13
contributing factor to his injuries.6 Lindstrom, 424 F.3d at
492.
1
Absent direct evidence of causation, a party may satisfy
the substantial-factor test by demonstrating that the injured
person had substantial exposure to the relevant asbestos for
a substantial period of time. See id.; see also Menne v.
Celotex Corp., 861 F.2d 1453, 1462 (10th Cir. 1988) (“More
significant under traditional causation tests than the question
of mere exposure to [asbestos-containing] products is whether
the exposure was sufficiently sustained (or frequent) and
intense to constitute a proximate cause of [the plaintiff’s]
mesothelioma.”). Evidence of only minimal exposure to
asbestos is insufficient; there must be “a high enough level of
exposure that an inference that the asbestos was a substantial
factor in the injury is more than conjectural.” Lindstrom,
424 F.3d at 492 (internal quotation marks omitted).
McIndoe’s heirs failed to put forward such evidence here.
Even crediting the assertions of their two first-hand
6
Lindstrom, from the Sixth Circuit, appears to be the only federal Court
of Appeals decision to consider squarely the causation standard
applicable to asbestos claims under maritime law. But the Sixth Circuit’s
analysis comports with the general approach taken by other federal courts
in asbestos cases, and we agree with the district court and the parties that
such standard governs our analysis. See also Benefiel v. Exxon Corp.,
959 F.2d 805, 807 (9th Cir. 1992) (applying “substantial factor”
requirement to maritime tort); Curtis v. ABB Inc., 622 F. App’x 661 (9th
Cir. Nov. 13, 2015) (mem.) (applying Lindstrom to asbestos claim);
Restatement (Third) of Torts: Liab. for Physical & Emotional Harm § 36,
reporter’s note, cmt. b (Am. Law Inst. 2010) (citing numerous
jurisdictions that employ the substantial-factor standard to limit scope of
liability in asbestos cases).
14 MCINDOE V. BATH IRON WORKS
witnesses, at most the heirs have provided evidence that
McIndoe was “frequently” present during the removal of
insulation aboard the Worden and was present 20–30 times
during such removal aboard the Coral Sea. But, as the
district court found, even if McIndoe was around asbestos
dust several times, his heirs presented no evidence regarding
the amount of exposure to dust from originally installed
asbestos, or critically, the duration of such exposure during
any of these incidents. Without such facts, McIndoe’s heirs
can only speculate as to the actual extent of his exposure to
asbestos from the shipbuilder’s materials. At this stage, more
is needed. See Cafasso v. Gen. Dynamics C4 Sys., Inc.,
637 F.3d 1047, 1061 (9th Cir. 2011); R.W. Beck & Assocs.,
27 F.3d at 1480 n.4.
2
The heirs do not seriously contend that they provided
evidence demonstrating that McIndoe suffered substantial
exposure to originally installed asbestos for a substantial
period of time. Instead, they argue that evidence of
prolonged exposure is not needed, because they presented the
opinion of Dr. Allen Raybin—a medical expert who asserted
that every exposure to asbestos above a threshold level is
necessarily a substantial factor in the contraction of asbestos-
related diseases.
The district court properly rejected this argument.
McIndoe’s heirs appear to have introduced Dr. Raybin’s
testimony and his “every exposure” theory of asbestos
causation to reject the substantial-factor test as a whole. Dr.
Raybin did not speak to the severity of McIndoe’s own
asbestos exposure beyond the basic assertion that such
exposure was significantly above ambient asbestos levels.
MCINDOE V. BATH IRON WORKS 15
More critically, Dr. Raybin did not speak to the severity of
McIndoe’s exposure to originally installed asbestos—and
generally did not make distinctions between the overall dose
of asbestos McIndoe breathed aboard the ships and that
portion of such exposure which could be attributed to the
shipbuilders’ materials.7 Likewise, Dr. Raybin did not opine
on the effect of McIndoe’s actual exposure to the
shipbuilders’ asbestos-containing materials, except in the
broadest sense. Namely, while Dr. Raybin concluded that the
exposures described by Sappington and Tench would have
substantially contributed to McIndoe’s injuries, he explicitly
and directly based such conclusion on his “each and every
exposure” theory of causation. Taken together, Dr. Raybin’s
testimony aims more to establish a legal conclusion—what
general level of asbestos exposure is required to show disease
causation—than to establish the facts of McIndoe’s own
injuries.
McIndoe’s heirs cite no case approving the use of such a
sweeping opinion to satisfy causation under maritime law.
Indeed, in Lindstrom, the Sixth Circuit explicitly rejected an
argument similar to the heirs’, concluding that such a theory
of liability would render the substantial-factor test essentially
meaningless. See 424 F.3d at 493. Allowing causation to be
established through testimony like Dr. Raybin’s would
“permit imposition of liability on the manufacturer of any
7
To the extent that Dr. Raybin attempted to assert that the encounters
described by Tench and Sappington “are high level exposures that
occurred for a prolonged period of time,” he had no basis on which to do
so. As described above, Tench and Sappington failed to provide
information regarding the intensity or duration of McIndoe’s alleged
exposures to originally installed asbestos aboard the Worden and Coral
Sea; McIndoe’s heirs cannot rely on a third-party expert to fill in those
percipient gaps for them.
16 MCINDOE V. BATH IRON WORKS
[asbestos-containing] product with which a worker had the
briefest of encounters on a single occasion.” Id. This is
precisely the sort of unbounded liability that the substantial
factor test was developed to limit. See Restatement (Third)
of Torts: Liab. for Physical & Emotional Harm § 36
reporter’s note, cmt. b (Am. Law Inst. 2010). Because the
heirs’ argument would undermine the substantial factor
standard and, in turn, significantly broaden asbestos liability
based on fleeting or insignificant encounters with a
defendant’s product, we, too, reject it.8
Notwithstanding the declaration of Dr. Raybin,
McIndoe’s heirs failed to put forward evidence demonstrating
that McIndoe was substantially exposed to asbestos from the
shipbuilders’ materials for a substantial period of time. The
heirs have established no genuine issue of fact regarding
whether any such exposure was a substantial factor in
McIndoe’s injuries, and thus they cannot prevail on their
general negligence claims.9 See Lindstrom, 424 F.3d at492–93.
8
As the Sixth Circuit acknowledged, rejection of this argument still
allows a plaintiff to satisfy causation through expert testimony that the
plaintiff’s actual exposure to certain materials substantially contributed to
the development of his injuries. It simply prevents the type of sweeping
testimony offered here—that all exposures to asbestos above background
levels necessarily and substantially contribute to development of diseases
like mesothelioma. See Lindstrom, 424 F.3d at 493.
9
Because we conclude that McIndoe’s heirs cannot establish a prima
facie case for their claims, we do not consider the shipbuilders’ asserted
affirmative defenses.
MCINDOE V. BATH IRON WORKS 17
V
The judgment of the district court is AFFIRMED.