Although the Court’s decision could have a significant impact on defendants whose bare-metal products were frequently used in maritime situations, its impact should be much more limited outside of maritime cases.

On March 19, 2019, the United States Supreme Court took a middle-ground approach in deciding when, under federal maritime law, a “bare-metal” manufacturer is liable for failure to warn of dangers posed by parts used with its products, even though they are made by other manufacturers. Rejecting both a “foreseeability” standard and the “bare metal defense,” the 6-3 majority in Air & Liquid Systems Corp. v. DeVries held that “[i]n the maritime tort context, a product manufacturer has a duty to warn when (i) its product requires incorporation of a part, (ii) the manufacturer knows or has reason to know that the integrated product is likely to be dangerous for its intended uses, and (iii) the manufacturer has no reason to believe that the product’s users will realize that danger.”

Background

In DeVries, the families of two Navy veterans claimed that the veterans were exposed to asbestos from insulation or parts installed on products such as pumps, blowers and turbines used on Navy ships. Since the manufacturers of the asbestos-containing parts were bankrupt, and the Navy was immune from liability, the families sued the equipment manufacturers, even though the equipment itself did not contain asbestos.

The district court granted summary judgment in favor of the equipment manufacturers under the “bare-metal defense.” Under that defense, “If a manufacturer did not itself make, sell, or distribute the part or incorporate the part into the product, the manufacturer is not liable for harm caused by the integrated product—even if the product required incorporation of the part and the manufacturer knew that the integrated product was likely to be dangerous for its intended uses.”

The Third Circuit reversed, applying the plaintiff-friendly “foreseeability” standard. Under that standard, “A manufacturer may be liable when it was foreseeable that the manufacturer’s product would be used with another product or part, even if the manufacturers’ product did not require use or incorporation of that other product or part.”

The Majority Takes a Middle-Ground Stance Between Standards

The Supreme Court granted certiorari, acting as a common-law court because the action was a maritime case. Writing for the majority, Justice Kavanaugh took a third approach that “falls between” those of the district court and the Third Circuit. Under that middle-ground approach, “foreseeability that the product may be used with another product or part that is likely to be dangerous is not enough to trigger a duty to warn. But a manufacturer does have a duty to warn when its product requires incorporation of a part and the manufacturer knows or has reason to know that the integrated product is likely to be dangerous for its intended uses.”

Justice Kavanaugh, joined by Chief Justice Roberts and Justices Ginsburg, Breyer, Sotomayor and Kagan, stated that “a rule of mere foreseeability would sweep too broadly” because “[r]equiring a product manufacturer to imagine and warn about all of” the “possible uses” of its product “would impose a difficult and costly burden on manufacturers, while simultaneously overwarning users.” At the same time, Justice Kavanaugh said that “the bare-metal defense ultimately goes too far in the other direction,” noting that “the product manufacturer will often be in a better position than the parts manufacturer to warn of the danger from the integrated product” and that requiring manufacturers to warn of dangers imposed by later-added parts “should not meaningfully add” to the burden imposed by the manufacturer’s duty to warn.

The Dissenters Would Have Adopted the Bare-Metal Defense

Justice Gorsuch dissented, joined by Justices Thomas and Alito. The dissenters criticized both the majority’s standard and the “foreseeability” standard as lacking “meaningful roots in the common law.” Instead, Justice Gorsuch explained that, at common law, a manufacturer only has a duty to warn about its own products. In addition, the dissenters reasoned that “the traditional common law rule still makes the most sense today” because a product’s manufacturer is in the best position to warn of its risks. In addition, the dissent argued that the majority’s rule could lead to overwarning, and could be overly complicated to apply. As Justice Gorsuch put it, “Would a seller of hot dog buns have to warn about the health risks of consuming processed meat?”

Finally, the dissenters expressed concern that the “new standard” articulated by the majority deprives defendants of fair notice because “[d]ecades ago” they “produced their lawful products and provided all the warnings the law required.” According to the dissent, “In deviating from the traditional common law rule, the court may be motivated by the unfortunate facts of this particular case” where “[t]he bare metal defendants may be among the only solvent potential defendants left.”

The Court’s Rule Is Limited to Maritime Cases

However, as the dissent put it, “there’s a silver lining here” because the majority’s “new standard” only applies in the maritime context and was motivated by the Court’s “solicitude for sailors” that characterizes its maritime law. Although the Court’s decision could have a significant impact on defendants whose bare-metal products were frequently used in maritime situations, its impact should be much more limited outside of maritime cases.