Despite the absence of appellate case law challenging the successful use of the bulk supplier doctrine ("BSD"), product liability defendants should assert and aggressively pursue dismissal of claims against them based upon the BSD, particularly in cases involving the distribution of chemicals in bulk.

In New York, manufacturers, wholesalers, distributors, component manufacturers and retailers of defective products placed into the stream of commerce may be held liable for injuries caused by their products. These cases generally involve three theories of liability: defective design, manufacturing defects and failure to warn. The BSD is one of several defenses available to product liability defendants with respect to the duty to warn. Others include the responsible or learned intermediary, knowledgeable user, sophisticated purchaser, ingredient supplier and natural raw materials defenses. While these defenses often share common elements, they are distinguishable both conceptually and in their purpose.

The BSD can be considered by bulk suppliers of products and component parts that are incorporated into finished retail products. When the doctrine is successfully asserted, the bulk supplier is deemed to have satisfied its duty if it adequately warns the immediate purchaser of the bulk products. The BSD absolves the manufacturer or bulk supplier of the duty to directly warn the end user of its product’s dangers.

The BSD is premised upon the notion and realization that it may not be practical to require manufacturers to warn every potential user of the risks associated with their products that are sold in bulk. Sometimes, as in the case of the learned intermediary, it is sufficient to place that responsibility with a physician who prescribes pharmaceuticals. Although the responsible intermediary defense has not been extended beyond manufacturers of prescription medications and medical devices, the BSD has no such limitation and has been held applicable to the suppliers of products in purely commercial contexts.

While the sophisticated user defense focuses on the special knowledge possessed by the consumer or employer of the injured party, the BSD focuses on the undue burden that would be imposed on the supplier if it were required to directly warn all downstream users. Some products, such as natural substances, are incapable of being labeled at the time of their unfinished and initial introduction into commerce. Therefore, it may be difficult or impossible for the component supplier, at the beginning of the manufacturing chain, to transmit an effective warning to downstream users. This difficulty is exemplified in the situation where the supplier is providing products such as gases or liquids sold in bulk.

Courts are reluctant to grant summary judgment in favor of product liability defendants relying on the BSD because there are issues of fact as to whether the warnings were adequate. Nevertheless, numerous federal statutes preempt plaintiffs’ claims that product labels were inadequate and should have contained different or additional information. These statutes include the Federal Hazardous Substance Act, the Federal Environmental Pesticide Control Act of 1972 and the Federal Caustic Poison Act.

Federal preemption may be a complete defense where the claimant’s theory is predicated on the adequacy of product labeling. Claims that a product’s label did not conform to the statutory or regulatory requirements are, however, viable. Parenthetically, if a plaintiff asserting a failure-to-warn claim admits he or she did not read the label, this concession may provide a product liability defendant with a distinct defense based on the plaintiff’s inability to establish a nexus between the adequacy of the label and the plaintiff’s injury.

Some states have expressly expanded the BSD to suppliers of chemicals. Few appellate courts in New York have addressed its application. However, several courts of original jurisdiction have commented on the defense. In 1990, in the case of Rivers v. AT&T Inc., the Supreme Court of the State of New York, New York County found the BSD applicable to a manufacturer of dimethylformamide ("DMF"). Subsequent decisions suggest chemical manufacturers and distributors can successfully utilize the doctrine. Those cases delineate the evidence defendants must submit to establish their prima facie defense premised upon the BSD.

In Rivers, the administrator of the estate of an employee of the New York Telephone Company filed a lawsuit claiming the decedent’s exposure to DMF caused her death. In that case, DMF was incorporated into a chemical compound used to manufacture a capacitor, an electrical component of a Dataphone 9600, which was used at the plaintiff’s workplace. DuPont Co. manufactured the DMF and AT&T Technologies Inc., installed the capacitor. The capacitor later failed and released DMF vapors, fatally injuring the decedent. The plaintiff asserted DuPont failed to warn the decedent of the dangerous propensities of DMF. DuPont moved for summary judgment arguing that, as a manufacturer of a chemical solvent that was sold in bulk to commercial customers, it had no duty to warn the decedent and its duty was satisfied by issuance of sufficient warnings to its customers. The judge granted DuPont’s motion, acknowledging that no New York appellate decision had addressed the issue, and therefore sought guidance from decisions from other jurisdictions, including California and Kansas. The cases in which the judge relied concluded that requiring bulk manufacturers to issue warnings through the chain of distribution would be onerous and impractical.

In granting DuPont’s motion, the judge also relied on the trial court decision of Matera v. Worksafe Inc. Although Matera involved asbestos fibers and not chemicals, the court used the same rationale to reach its finding, and held that assigning responsibility to a fiber manufacturer to warn the end user was not only impractical, but not feasible. After concluding it would be impractical for DuPont to warn end users of those retail products containing DMF, the court’s inquiry shifted to the adequacy of the warnings to its immediate distributees. The judge determined that DuPont’s warnings were adequate, and noted that the distributors and distributees were sophisticated users of DMF and responsible intermediaries aware of its characteristics. The rationale is similar to the application of the learned intermediary doctrine, which applies to medical professionals charged with knowledge of prescription medication package inserts and the Physicians’ Desk Reference.

A trial court confronted a manufacturer’s contention that it had no duty to warn end users of the dangers associated with pesticides again in 1996. In Oeffler v. Miles Inc., an employee at Rensselaer Polytechnic Institute commenced an action alleging she became ill from exposure to pesticides used at RPI’s premises. The plaintiff sued the pesticides manufacturers and marketers. The defendants moved for summary judgment, asserting they merely distributed chemicals that were reformulated by other companies and therefore had no duty to warn remote users of the components’ potential dangers. The judge considered the Rivers decision, but denied defendants’ motions. The court did not attempt to distinguish the facts of Oeffler from those in Rivers. While the Rivers decision focused on the impracticality and onerous task of compelling bulk suppliers to warn end users of retail products that contain potentially dangerous materials, the Oeffler decision focused on the absence of a responsible intermediary and knowledgeable/sophisticated user. The judge’s ruling implicitly affirmed the applicability of the BSD, but found the defendants in Oeffler failed to prove the requisite elements of the defense. Citing Wolfgruber v. Upjohn Co., the judge distinguished cases involving chemicals from those involving prescription drugs.

A year after Oeffler, the Appellate Division, Third Department considered the applicability of the BSD in the context of a chemical exposure claim in Polimeni v. Minolta. In Polimeni, a plaintiff was injured from exposure to Isopar G, an Exxon Mobil Corp. product that was allegedly sold in bulk and incorporated into photocopy toner. The plaintiff alleged she was exposed to the chemical at her workplace. The trial court denied defendants’ summary judgment motion premised upon the responsible intermediary doctrine ("RID") and BSD. The Third Department affirmed that decision, concluding that there was not enough proof to support the defendants’ motion because issues of fact existed as to whether the chemical compound was sold in bulk and the adequacy of the warnings provided. The Third Department ruled that the RID does not apply to cases of a purely commercial context. However, implicit in its ruling, the Polimeni decision suggests that the BSD may be applied to cases outside of pharmaceuticals that are of a purely commercial context. Had Exxon established that it sold the product in bulk and, through expert affidavits, that it supplied adequate warnings, the outcome of Polimeni likely would have been different.

The applicability of the BSD re-emerged in the 2013 case of McCormack v. Safety Kleen Systems. In McCormack, the plaintiff sued United States Steel Corp. alleging he sustained injuries from exposure to a benzene-based solvent, Raffinate, which was manufactured and distributed by the company. Radiator Specialty Company purchased Raffinate from USS and incorporated it into several products, including Liquid Wrench and Gum Out. The plaintiff alleged exposure to the products resulted in illness. He further claimed that the defendants failed to warn him of the dangerous nature of their products and the risks associated with exposure. USS moved for summary judgment on seven grounds, including the BSD. USS asserted that, as a bulk supplier of Raffinate to a sophisticated company, it had no duty to warn the end users of the retail products that contained Raffinate. USS' motion was denied. Notably, the court held that there were issues of fact as to whether USS properly warned Radiator Specialty of the dangers of Raffinate, and whether Radiator Specialty would have used Raffinate in its products if it were fully aware of its dangerous propensities. However, the court did not rule that the BSD was inapplicable to the suppliers of chemicals, but instead denied the motion based on the insufficiency of the moving papers. Implicit in this ruling is that the BSD remains available to those defendants who supply adequate proof of each of its elements, including that they sold their product in bulk and provided adequate warnings concerning the product to responsible intermediaries.

Manufacturers and distributors of chemicals sold in bulk should seek dismissal of product liability claims based upon the BSD in New York. Despite the dearth of appellate case law applying the BSD to bulk suppliers of chemicals and components that are incorporated into end-user retail products, the defense is not only viable, but strong.

A product liability defendant must establish through discovery the necessary elements of the BSD. Prediscovery applications for dismissal will usually be denied. Defendants must demonstrate that the product was sold in bulk and adequate warnings were provided to a responsible intermediary. In the case of regulated substances, an expert affidavit attesting that the subject label conforms to all regulations will help a defendant establish that it satisfied its duty to warn. The affidavit may also establish that New York State court claims, which are premised upon the adequacy of the labels, are preempted. Manufacturers and distributors should prepare and maintain records that establish that appropriate warnings and labels were provided to their immediate customers.

The absence of appellate cases does not suggest the BSD is not applicable, nor does it imply that the doctrine was not viable beyond prescription drugs. To the contrary, their absence suggests claimants’ inability to connect bulk suppliers with the products causing their injuries and/or that the orders dismissing claims against the bulk suppliers were never challenged at the appellate level. In the cases discussed above in which the BSD applications were denied, the courts held that the movants failed to establish prima facie entitlement to dismissal based on the insufficiency of the evidence presented.

**Note: this article is presented as it originally appears in Law360