Pfeifer v. John Crane, Inc.
220 Cal. App. 4th 1270
| Cal. Ct. App. | 2013Background
- William Pfeifer, a Navy boiler technician (1963–1971) and later a civilian boiler technician (until 1982), developed pleural mesothelioma in 2009 and sued multiple suppliers for asbestos exposure; John Crane, Inc. (JCI) was the sole remaining defendant at trial.
- Evidence showed JCI manufactured asbestos-containing gaskets and packing, knew by the 1970s that asbestos was hazardous, protected its own employees, but did not warn customers until the early 1980s and did not test whether bonding agents prevented fiber release.
- The jury found for the Pfeifers on negligence, strict liability, and consortium claims; awarded substantial economic and noneconomic damages, allocated 70% fault to JCI, and found malice/oppression, then awarded $14.5 million punitive damages.
- Postverdict the trial court reduced certain past medical expenses, ordered a credit to JCI for pre-verdict settlements, and ordered production of JCI’s financial data for the punitive-damages phase; JCI appealed and the Pfeifers cross-appealed.
- The Court of Appeal affirmed the judgment except it dismissed review of the expert-fee award (JCI failed to appeal that order) and corrected the calculation of the Pfeifers’ net recovery of economic damages.
Issues
| Issue | Plaintiff's Argument (Pfeifer) | Defendant's Argument (JCI) | Held |
|---|---|---|---|
| Sufficiency of evidence for comparative-fault allocation (including 70% to JCI; 0% to plaintiff/Flexitallic; 12.5% to Navy) | Jury’s apportionment is supported by evidence that Pfeifer repeatedly used JCI products and experts tied JCI exposure to disease. | JCI argued exposure was from many sources so its share was unsupported and plaintiff or others should bear fault. | Affirmed: substantial evidence supports the jury’s apportionment; JCI offered no quantified evidence of other-source exposure so jury reasonably assigned 70% to JCI and 0% to others in context. |
| Sophisticated-user/sophisticated-intermediary defense (whether Navy’s knowledge shields JCI liability to Navy employees) | JCI contended Navy’s sophistication and knowledge should immunize JCI and its employees are "deemed" sophisticated users. | JCI argued Johnson and related authorities allow imputing intermediary knowledge to employees, eliminating duty to warn. | Reversed as to defense theory requested: Court held an intermediary’s sophistication does not automatically shield supplier from duty to warn employees; supplier must have reason to believe ultimate users know or will be warned. Directed verdict on JCI’s proffered (erroneous) instruction was proper. |
| Punitive damages (sufficiency, financial evidence, constitutional excess) | Award supported by jury findings of conscious disregard; plaintiffs presented JCI financials to prove ability to pay. | JCI argued lack of sufficient evidence of malice, improper admission/use of financial info, and punitive award excessive/violative of due process. | Affirmed: substantial evidence of malice/oppression (JCI knew risks, protected own employees, downplayed hazards, failed to warn customers), financial showing adequate under Adams/Mike Davidov, and punitive award not constitutionally excessive (ratio ~2.3:1 to compensatory after proper adjustments). |
| Postjudgment expert-fee award under CCP §998 and settlement-credit calculation | Plaintiffs defended trial court’s award of expert fees and the court’s method for computing credit for pretrial settlements; requested correction of net economic recovery calculation. | JCI challenged expert-fee award and settlement credit math. | Expert-fee award: dismissed from appeal (JCI failed to appeal the postjudgment order). Settlement-credit and net-economic recovery: trial court did not abuse discretion in rejecting settlement allocation and used an approved method; court modified judgment to correct Pfeifers’ net economic recovery to $1,374,622.29. |
Key Cases Cited
- Johnson v. American Standard, Inc., 43 Cal.4th 56 (Cal. 2008) (recognizes sophisticated-user defense focusing on whether the user knew or should have known the risks)
- Rutherford v. Owens-Illinois, Inc., 16 Cal.4th 953 (Cal. 1997) (substantial-factor test in multi-source asbestos causation)
- Stewart v. Union Carbide Corp., 190 Cal.App.4th 23 (Cal. Ct. App. 2010) (refuses broad imputation of intermediary knowledge; supports punitive-award analysis in asbestos context)
- Bankhead v. ArvinMeritor, 205 Cal.App.4th 68 (Cal. Ct. App. 2012) (upholds substantial punitive award where manufacturer knew risks, protected own employees, but failed to warn users)
- Mike Davidov Co. v. Issod, 78 Cal.App.4th 597 (Cal. Ct. App. 2000) (trial court may order defendant financial discovery after liability is found for punitive damages)
- Adams v. Murakami, 54 Cal.3d 105 (Cal. 1991) (plaintiff must prove defendant’s financial condition to assess punitive damages)
- Fish v. Guevara, 12 Cal.App.4th 142 (Cal. Ct. App. 1993) (expert-fee awards under CCP §998 are collateral and require a separate appeal)
Disposition: Judgment affirmed as modified to correct net economic recovery; JCI’s appeal as to expert-fee award dismissed for lack of appeal; other challenges rejected.