Verdict on Non-Economic Damages Reversed and Remanded with Finding of Joint/Several Liability Against Pipe Manufacturer Court of Appeal, First District, Division 4, California. April 15, 2019

CALIFORNIA — In an update to Asbestos Case Tracker’s previous post, the court reversed and remanded this matter ordering a new entry of judgment holding the plaintiffs’ economic and noneconomic damages jointly and severally liable against CertainTeed Corporation (defendant). At the trial level, a jury previously returned a verdict on economic damages in the amount of $776,201 against defendant. The verdict also included $9.25 million in noneconomic damages which was apportioned to defendant at 62 percent with the remaining to other joint tortfeasors. The defendant moved for judgment notwithstanding the verdict (JNOV) on the plaintiff’s intentional concealment and misrepresentation claims. The court denied defendant’s motion on intentional concealment and granted the motion as to intentional misrepresentation. The court further granted the plaintiff’s motion to amend the judgment to eliminate defendant’s proportionate fault reduction for noneconomic damages. The defendant appealed the amended judgment. Of interest, the defendant attempted to pay the partial judgment of the original judgment pending the appeal. The plaintiff rejected the check.

On appeal, the court dealt with preliminary issues regarding jurisdiction over the judgments and JNOV order before moving to the substantive issues of the appeal. As to concealment, the court pointed out the elements for fraudulent concealment include 1) the defendant concealed or suppressed a material fact; 2) the defendant was under a duty to disclose the fact to the plaintiff; 3) the defendant intentionally concealed or suppressed the fact with the intent to defraud the plaintiff; 4) the plaintiff was unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed; 5) as a result of the concealment or suppression of the fact, the plaintiff sustained damage. The defendant took the position that the evidence was lacking as to these required elements. Specifically, the defendant argued that there was never a transaction between with the plaintiff. Further, no but-for causation evidence existed. The court noted that the jury instructions and causation theories were agreed upon by the defendant at the trial level. Therefore, it cannot seek reversal on a theory different “from those advanced and tried below.” As for intent to deceive, the court concluded there was “substantial evidence” to support the jury’s finding. Here, the defendant had known of the link between cancer and asbestos in the 1960’s and its own internal documents showed that low exposure to asbestos could cause mesothelioma in workers. Moreover, the defendant’s own salesforce was instructed to not meander in conversation with its customers regarding the hubbub surrounding the emerging questions on health and asbestos exposure. The defendant argued that the plaintiffs had no evidence that Mr. Burch relied upon any representation from the defendant. The court disagreed as the absence of any warnings would allow a jury to conclude he may have acted differently had a concealed danger been known. However, the court’s analysis on intentional misrepresentation was far different. The court quickly noted that the plaintiffs lacked evidence on this issue because the plaintiff “testified that he does not recall ever seeing the materials containing defendant’s misrepresentations, and he cannot relied on what he never saw.” The court was equally unpersuaded by the plaintiffs’ argument that section 533 of the restatement imports an exception in the plaintiffs’ favor of misrepresentation to a third party. However, the court pointed out that the plaintiff must still prove the reliance upon the misrepresentation. Accordingly, the JNOV on the plaintiffs’ misrepresentation claims would not be reversed.

Finally, the court began its analysis of the apportionment of liability on noneconomic damages. According to the court, the courts are split on “whether section 1431.2 requires a judgment of several liability for an intentional tortfeasor for noneconomic damages in direct proportion to the intentional tortfeasor’s percentage of fault. As a backdrop to its analysis, the court reminded that the Supreme Court “will soon resolve the split of authority” in its review of the B.B. matter. Until then, the court agreed with its decision in the Thomas matter and held that section 1431.2 does not “operate to limit an intentional tortfeasor’s liability for noneconomic damages as to the percentage of fault under comparative fault principles.” The decision in Thomas included “policy considerations of deference and punishment for intentional torts…” Consequently, the court ordered remand with directions to enter judgment against the defendant jointly and severally liable for both economic and noneconomic damages.

Read the full case decision here.

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