Insulation Supplier Contracting with U.S. Navy Protected by Government Contractor Defense Court of Appeals of California, First Appellate District, June 6, 2017

Jay Wanlass filed suit against Metalclad Insulation Corp. (Metalclad) based on alleged exposure to friable asbestos. Metalclad moved for summary judgment, which the trial court granted. The plaintiff appealed that decision to the First District Court of Appeal for Division 2 in California.

In 1968, Metalclad entered into an agreement with the United States Navy to supply insulation for piping on four nuclear-powered submarines. Those submarines were all constructed at Mare Island Naval Shipyard in Vallejo, California. The plaintiff alleged he was exposed to asbestos containing insulation while he was working as a machinist at Mare Island from 1968-80 on the submarines for which Metalclad brokered the Unibestos to the Navy.

Metalclad argued the plaintiff’s claims are precluded under the government contractor defense, which shields military contractors from state tort law liability for defects in military equipment supplied to the United States. Specifically, Metalclad met the three elements of the government contractor defense: 1) the United States approved reasonably precise specifications; 2) the equipment conformed to those specifications; and 3) the supplier warned the United States about the dangers in the use of the equipment that were known to the supplier but not the United States. Metalclad further argued the plaintiff’s claims for negligent and strict liability failure to warn fail because it would have been impossible for Metalclad to warn the plaintiff of the hazards of Unibestos; even if Metalclad had placed its own warning on the product, that warning would not have prevented the plaintiff’s exposure. The court agreed and granted summary judgment.

The plaintiff argued that the application of the government contractor defense was misapplied. The Court of Appeals disagreed, noting that the First District Court of Appeal for Division 1 had ruled on an almost identical appeal by the same law firm representing Mr. Wanlass. That matter was filed on behalf of another plaintiff, Gary Kase. In both cases, the underlying orders by Judge Jackson granting the motions were filed on November 27, 2013. The orders are substantially identical.

In affirming, this court noted, “The Kase opinion comprehensively vindicated Judge Jackson’s decision as to the scope of the government contractor defense to the same claims also made here by Wanlass. The opinion is thorough, its reasoning unanswerable. Because we cannot improve on Kase’s analysis, we adopt it as our own.”

The court continued, “…Wanlass does not dispute that the Unibestos was manufactured by Pittsburgh Corning, not Metalclad; that Metalclad was simply the “broker [ ]” who procured Unibestos for the Navy from Pittsburgh Corning; and that Pittsburgh Corning provided warnings on the packages of Unibestos. Despite this limited relationship, Wanlass argues that Metalclad was nevertheless under an obligation to add its own warnings. But Wanlass is unable to produce one authority imposing a duty to warn upon a party that is in effect merely a shipping agent of a finished product manufactured by a third party and was never in physical possession of the finished product.”

Read the full decision here.

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