Manufacturers In The Courts: January - February 2010

E-mail briefing from the
National Association of Manufacturers
January-February, 2010

To XXXXXX:

On February 16, the NAM and seven other associations filed a suit against the EPA challenging its "endangerment" finding relating to greenhouse gas regulation. EPA found that greenhouse gas emissions contribute to air pollution that is reasonably anticipated to endanger the public health and welfare and should be regulated. Many other organizations filed their own challenges as well.

Your company or your industry's association may want to intervene. Intervention requires a motion to the court by March 18, and intervenors allowed by the court will be able to fully participate in the case. If you would like more information about this possibility, please plan to attend an explanatory meeting on Monday, March 1, at 2:30 pm EST. We have arranged for our outside counsel to facilitate your participation as an intervenor, as long as you are comfortable with our approach to the legal issues. Even if you are not interested in intervening, this meeting will bring you up-to-date on the litigation.

Please contact Pam Roper at proper@nam.org to R.S.V.P. The agenda, dial-in information and other meeting materials will be provided by COB Friday, February 26th, to those who cannot attend in person.

The following report covers the latest developments from January and February in cases that have a significant impact on manufacturers, and that warranted involvement by the NAM.

Decided Cases


Product Liability

Duty to warn about hazards of third party products. The NAM and six other organizations urged a California appeals court to affirm a lower court ruling that refused to hold a manufacturer liable for failing to disclose hazards that arose from products made, sold or installed by another manufacturer. On February 16, the California court affirmed the lower court ruling and rejected a new duty to warn in this case. Hall v. Warren Pumps, LLC (Cal. Ct. App.)

Litigation tourism rejected in California. The plaintiff moved to California, was diagnosed with mesothelioma, and sued over asbestos exposure that allegedly occurred about 50 years before in Oklahoma. The NAM filed an amicus brief to oppose this suit, and the California Supreme Court ruled on February 18 that Oklahoma's 10-year statute of repose governed the suit. The court ruled that Oklahoma's interest in fostering fair treatment and promoting commerce for both in-state and out-of-state companies outweighed California's interest in providing a forum for this litigation. This is a significant victory that will help prevent forum shopping by those whose claims have long since been extinguished under state law. McCann v. Foster Wheeler LLC (Cal.)

Pending Cases

Environmental

Challenge to EPA's endangerment finding. On February 16, the NAM and seven other business groups filed a petition in federal appeals court challenging the EPA's endangerment finding, which is the latest step in the agency's plan to regulate greenhouse gas emissions from stationary sources through the Clean Air Act. Many states and business groups are challenging the EPA, and the NAM's effort is focused on EPA's process and the impact on stationary sources only. Unless our litigation is successful, 200,000 manufacturing facilities are expected to face new regulations on greenhouse gases. National Association of Manufacturers v. EPA (D.C. Cir.)

Validity of permit for exploratory oil and gas drilling in Alaska. The NAM has asked a federal appeals court to reject an effort that would delay exploratory drilling for oil and gas in the Beaufort Sea north of Alaska. The Department of the Interior has conducted an extensive evaluation of the process and concluded that exploration would cause no significant impact on the environment. The NAM filed an amicus brief supporting exploratory drilling as an important step in the process of utilizing the Outer Continental Shelf to promote greater energy self-sufficiency, to provide economic stimulation, to improve national security, to maintain a favorable balance of payments in world trade and to create jobs. Alaska Eskimo Whaling Comm'n v. Salazar (9th Cir.)

Miscellaneous

Whether discovery should be compelled to prevent abuse of the legal system. This case, involving alleged exposure to hazardous materials, is about discovery abuse in South Texas and has been pending for over a decade. The defendants have been unable to get even the most basic discovery identifying products involved, claimed exposures and basic causation. The NAM and three other business groups joined in an amicus brief filed on February 12 urging the Texas court to rein in this abuse. In re Allied Chemical Corp. (Tex.)

Product Liability

Duty to warn about hazards of third party products . The NAM filed a brief on January 18 arguing that manufacturers should not have a new legal duty to warn customers about risks that might arise from products made by other manufacturers that are used in conjunction with their products. This new duty is inconsistent with California law and with most courts around the country. William Powell Co. v. Walton (Cal. Ct. App.)

RICO Act

Statute of limitations in RICO suits against plaintiff law firms for fraudulent asbestos claims . The NAM and other legal reform groups joined in an amicus brief on January 14 in support of CSX Transportation, Inc., and its efforts to counter the litigation industry for generating fraudulent asbestos lawsuits against the company. The company filed suit in 2005, alleging that the defendant's law firm and radiologist had conspired with a union organizer and ex-railroad employees to fake asbestos screenings in order to win cash settlements from the company. The NAM/industry brief provides a history of rampant, coordinated asbestos fraud, and argues that CSX's suit should be allowed to proceed. CSX Transportation, Inc. v. Gilkison (4th Cir.)

 

The courts are often the last resort to protect manufacturers from unconstitutional laws, unauthorized regulations, misplaced legal theories by the trial bar, and oppressive procedural ploys. If you are aware of litigation against manufacturers that exceeds the bounds of reasonableness, or of laws or regulations that deserve scrutiny in the courts, please let us know. We may be able to help.


Quentin Riegel
Vice President, Litigation & Deputy General Counsel
(202) 637-3058 • qriegel@nam.org

National Association of Manufacturers
1331 Pennsylvania Avenue, NW Suite 600
Washington, DC 20004-1790


Check out the NAM's Manufacturing Law Center at www.nam.org/law

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