Farris et al v. 3M Company et al, No. 3:2018cv04186 - Document 159 (N.D. Cal. 2019)
Court Description: ORDER GRANTING SECOND MOTION TO DISMISS FIFTH CAUSE OF ACTION FOR MARKET SHARE LIABILITY by Judge Jon S. Tigar granting 137 Motion to Dismiss. (wsnS, COURT STAFF) (Filed on 4/29/2019)
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Farris et al v. 3M Company et al Doc. 159 1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 GARY FARRIS, et al., 7 Plaintiffs, 8 v. 9 3M COMPANY, et al., 10 Defendants. 11 United States District Court Northern District of California Case No. 18-cv-04186-JST ORDER GRANTING SECOND MOTION TO DISMISS FIFTH CAUSE OF ACTION FOR MARKET SHARE LIABILITY Re: ECF No. 137 12 Before the Court is Defendant Honeywell International Inc. (“Honeywell”)’s second 13 14 motion to dismiss Plaintiffs’ fifth cause of action for market-share liability. ECF No. 137. The 15 Court will grant the motion without prejudice. 16 I. BACKGROUND 17 Plaintiff Gary Farris was diagnosed with lung cancer in February 2016 after being 18 previously diagnosed with asbestosis. ECF No. 119 (“SAC”) at 3. Farris identifies three periods 19 of asbestos exposure over the course of his career. Id. at 5-6. He and his wife, Plaintiff Melva 20 Farris, bring claims for strict products liability, market-share liability, negligence, and fraud 21 against three groups of defendants they deem the Product Defendants, Respirator Defendants, and 22 Friction Defendants. See generally id. Plaintiffs’ allegations are set forth in greater detail in the 23 Court’s order granting Honeywell’s first motion to dismiss the fifth cause of action. ECF No. 115. 24 The motion now before the Court deals with Farris’s assertion that he was exposed to 25 asbestos while working on brakes and clutches in an automotive shop in San Jose, California 26 during the summers from 1960 to 1964 and while performing automotive repairs for himself, 27 family, and friends from the 1960s to 1980s. SAC at 5. Based on this exposure, Farris pleads 28 various claims against the Friction Defendants (Honeywell; BorgWarner Morse TEC LLC; Dockets.Justia.com 1 Maremont Corporation; O’Reilly Auto Enterprises, LLC; and Pneumo Abex, L.L.C). See id. at 4- 2 5. In the first amended complaint, Plaintiffs’ fifth cause of action for market-share liability 3 asserted that the Friction Defendants are liable for Plaintiff’s damages according to their share of 4 the market for “asbestos-containing motor vehicle friction products,” because Mr. Farris was 5 exposed to asbestos fibers released from those products, but, through no fault of his own, cannot 6 trace the products at issue to a certain defendant. ECF No. 46 at 13-15. Honeywell moved to 7 dismiss this claim. ECF No. 96. The Court granted the motion, holding that Plaintiffs failed to 8 plausibly plead that the goods at issue were fungible. ECF No. 115 at 5. Later that day, Plaintiffs 9 filed the second amended complaint, supplementing their contentions as to the fifth cause of 10 action. SAC at 12-15. Honeywell now again moves to dismiss Plaintiffs’ fifth cause of action for market-share United States District Court Northern District of California 11 12 liability against itself and the other Friction Defendants, arguing that Plaintiffs continue to fail to 13 plead this claim with sufficient particularity in their second amended complaint. ECF No. 137. 14 II. 15 LEGAL STANDARD Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain “a short and plain 16 statement of the claim showing that the pleader is entitled to relief.” While a complaint need not 17 contain detailed factual allegations, facts pleaded by a plaintiff must be “enough to raise a right to 18 relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). To 19 survive a Rule 12(b)(6) motion to dismiss, a complaint must contain sufficient factual matter to, 20 when accepted as true, state a claim that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 21 678 (2009). “A claim has facial plausibility when the plaintiff pleads factual content that allows 22 the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” 23 Id. While this standard is not a probability requirement, “[w]here a complaint pleads facts that are 24 merely consistent with a defendant’s liability, it stops short of the line between possibility and 25 plausibility of entitlement to relief.” Id. (internal quotation marks and citation omitted). 26 In determining whether a plaintiff has met this plausibility standard, the Court must 27 “accept all factual allegations in the complaint as true and construe the pleadings in the light most 28 favorable” to the plaintiff. Knievel v. ESPN, 393 F.3d 1068, 1072 (9th Cir. 2005). “Dismissal 2 1 under Rule 12(b)(6) is appropriate . . . where the complaint lacks a cognizable legal theory or 2 sufficient facts to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 3 521 F.3d 1097, 1104 (9th Cir. 2008). If the motion to dismiss is granted, the court should grant 4 leave to amend “unless it determines that the pleading could not possibly be cured by the 5 allegation of other facts.” Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995) (internal 6 quotation marks and citation omitted). 7 III. 8 United States District Court Northern District of California 9 DISCUSSION Plaintiffs’ fifth cause of action is based on Sindell v. Abbott Laboratories, 26 Cal. 3d 588 (1980) and Wheeler v. Raybestos-Manhattan, 8 Cal. App. 4th 1152 (1992). SAC at 12, 15. 10 Sindell established a burden-shifting “market-share” theory of tort liability, applicable in cases 11 where a plaintiff has been injured by a fungible good that cannot be traced to a specific producer. 12 26 Cal. 3d at 610-11; Magallanes v. Superior Court, 167 Cal. App. 3d 878, 884, 213 Cal. Rptr. 13 547, 550-51 (1985). A plaintiff injured by such a good may bring suit against the manufacturers 14 of a “substantial share” of the good, shifting the burden to the defendants to demonstrate that they 15 could not have made the product that injured the plaintiff. Id. at 612. Each defendant who fails to 16 do so is then held liable for the proportion of the judgment represented by its share of the relevant 17 market. Id. This theory of liability applies only to “fungible goods,” including “‘truly generic’ 18 goods, which are produced from an identical formula, . . . and ‘generally fungible’ goods such as 19 asbestos products composed of a specific asbestos fiber in a specific percentage.” Pooshs v. Philip 20 Morris USA, Inc., 904 F. Supp. 2d 1009, 1032 (N.D. Cal. 2012) (quoting Wheeler, 8 Cal. App. 4th 21 at 1156). 22 Wheeler elucidated the requirements to plead a market-share liability claim when injured 23 by a “generally fungible” good. 8 Cal. App. 4th at 1155-58. There, the plaintiff mechanics stated 24 a prima facie case for market-share liability where they pled that: 1) they had been exposed to 25 asbestos fibers in brake products; 2) they could not identify the makers of the products because the 26 brake pads were usually worn down, with the brand name obfuscated, when the mechanics were 27 exposed to them; 3) the brake pads were fungible because a pad of a given size could be used on a 28 range of vehicles, regardless of who made it, and the pads made by defendants were all comprised 3 1 of the same asbestos fiber, and contained a similar percentage of asbestos by weight; and 4) a 2 substantial share of the makers of the products were joined as defendants. Id. Plaintiffs’ first amended complaint alleged that Mr. Farris was injured by exposure to United States District Court Northern District of California 3 4 “asbestos fibers released from asbestos-containing motor vehicle friction products that are and 5 were fungible in color, size, shape, texture and function. Said products were indistinct and similar 6 in appearance and composition, and through no fault of the plaintiff these products cannot be 7 traced to a particular defendant or other entity.” ECF No. 46 at 13. The Court granted 8 Honeywell’s first motion to dismiss because Plaintiffs failed to identify what kinds of products 9 they were referring to (e.g., brakes or clutches), what type or types of asbestos fiber were present 10 in those products, or what quantities of asbestos existed within them. ECF No. 115 at 6-7. 11 Instead, Plaintiffs simply conclusorily alleged that the products in question were fungible. Id. at 7. 12 To remedy the deficiencies identified in the Court’s prior order, Plaintiffs have added two 13 paragraphs to their second amended complaint. Compare SAC at 12-15 with ECF No. 46 at 13- 14 15. 15 Plaintiffs’ first new paragraph identifies Honeywell, Maremont Corporation, O’Reilly 16 Auto Enterprises, LLC, and Pneumo Abex, L.L.C as manufacturers and/or distributors of 17 “asbestos drum and disc brake linings.” SAC ¶ 20. It asserts that Mr. Farris “was exposed to 18 asbestos from the installation and removal of brake linings.” Id. “These brake linings were 19 fungible to the extent that a brake lining of a given size and shape, regardless of who made it, 20 could be used on a variety of different vehicles.” Id. Plaintiffs plead that the brake pads 21 manufactured by the specified defendants “were all composed solely of chrysotile asbestos fiber” 22 and “all contained between 40 and 60 percent asbestos by weight.” Id. While Plaintiffs 23 acknowledge that new brake linings can be traced to a particular source through markings on the 24 packaging and the product itself, “brake linings removed from a vehicle generally cannot be traced 25 to a specific producer” because they are nearly identical in color, interchangeable with other 26 linings of the same size and shape, and “any markings on the linings are abraded away from their 27 use.” Id. Plaintiffs allege that “[a] substantial share” of the makers of brake linings for passenger 28 cars and light trucks have been joined as defendants. Id. Finally, they plead that “[b]oth 4 1 Honeywell and Abex had a substantial portion of the market share for brake linings for original 2 equipment manufacturers of vehicles in the United States at the time [Mr.] Farris worked with 3 brake linings.” Id. United States District Court Northern District of California 4 Plaintiffs’ second new paragraph alleges that Borgwarner Morse TEC LLC and O’Reilly 5 Auto Enterprises, LLC are manufacturers and/or distributors of “asbestos clutch facings for 6 manual clutches.” SAC ¶ 21. As with brakes, Plaintiffs claim that Mr. Farris “was exposed to 7 asbestos from the installation and removal of clutches.” Id. Again, they assert that the clutch 8 facings were fungible because a facing of a certain size and shape could be used on a range of 9 vehicles, that the facings were composed solely of chrysotile, and that the facings contained 10 between 40 and 60 percent asbestos by weight. Id. Plaintiffs allege that, like brake linings, clutch 11 facings can be identified by manufacturer when they are new, but not when they are old and worn 12 down. Id. Plaintiffs also allege that “[a] substantial share” of the makers of clutch facings for 13 passenger cars and light trucks have been joined as defendants. Id. Finally, Plaintiffs note that 14 “Louis Merz, Borg Warner’s corporate representative, has testified that Borg Warner had more 15 than 50% of the new clutch facing market from 1973 to 1981 and that it was more likely than not 16 that an original clutch facing removed” from a Ford, Chrysler, or General Motors vehicle at that 17 time was manufactured by Borg Warner. Id. 18 Honeywell argues that Plaintiffs’ amendments have only partially cured the deficiencies 19 identified in the Court’s prior order dismissing the market-share liability claim, and that fatal 20 problems remain in the complaint. ECF No. 137 at 2. First, Honeywell urges that Plaintiffs have 21 not plausibly pled that they have joined a “substantial share” of the makers of the offending 22 products. Id. at 5. According to Honeywell, Plaintiffs must specifically allege that they have 23 joined manufacturers constituting at least 51% of the relevant market. Id. at 7-8. Second, 24 Honeywell argues Plaintiffs must plead that Mr. Farris was primarily exposed to brake pads during 25 removal, rather than installation, to bring this case within the ambit of Wheeler. Id. at 8-10. 26 Third, Honeywell insists that even after amending the complaint, Plaintiffs continue to fail to 27 plausibly allege that the brake linings in question were fungible. Id. at 10-11. 28 In response, Plaintiffs concede that they need to conduct discovery on the issue of market 5 United States District Court Northern District of California 1 share, and that, once fact discovery is complete, there may be insufficient facts to establish 2 market-share liability. ECF No. 147 at 1. However, Plaintiffs insist that at the pleading stage, 3 there is no requirement that they identify a specific percentage of market share held by each 4 defendant in order to sufficiently plead “substantial share.” Id. Similarly, Plaintiffs urge that there 5 is no requirement in the case law that they plead brake removal as Mr. Farris’s primary source of 6 asbestos exposure. Id. at 2. Finally, Plaintiffs assert that they have plausibly pled fungibility by 7 identifying the products at issue (brakes and clutches), the type and percentage of asbestos fiber in 8 those products, and a physical description of the products including their shape, color, and use 9 within an automobile. Id. 10 Honeywell’s first argument in favor of dismissal is unavailing. The Wheeler court 11 considered and rejected the argument that Plaintiffs must prove that they have joined makers of a 12 specific percentage of the relevant products on the market at the time of injury to plead a market- 13 share liability claim. See Wheeler, 8 Cal. App. 4th at 1158; id. at 1156 (observing that “Plaintiffs 14 asserted, without specifying an exact percentage, that they had joined” a substantial share of the 15 manufacturers at issue). The Wheeler court held that because the issue arose on nonsuit, “we need 16 only inquire whether plaintiffs offered to prove that the defendants named constituted a substantial 17 share of such makers. They did. Whether they can prove that is another matter.” Id. 18 Under California law, a defendant may move for nonsuit at trial after the plaintiffs have 19 completed their opening statement or presented their evidence. Cal. Civ. Proc. Code § 581c(a). 20 “The granting of a motion for a nonsuit is warranted when, and only when, disregarding 21 conflicting evidence, and giving to plaintiff’s evidence all the value to which it is legally entitled, 22 indulging in every legitimate inference which may be drawn from that evidence, the result is a 23 determination that there is no evidence of sufficient substantiality to support a verdict in favor of 24 the plaintiff.” Keller v. Pac. Turf Club, 192 Cal. App. 2d 189, 190 (1961). Similarly, in ruling on 25 a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a court must “accept all 26 factual allegations in the complaint as true and construe the pleadings in the light most favorable” 27 to the plaintiff. Knievel, 393 F.3d at 1072. 28 Here, Plaintiffs have alleged that they have “joined as defendants a substantial share of the 6 United States District Court Northern District of California 1 manufacturers and suppliers of the asbestos-containing motor vehicle friction products that 2 comprised the relevant market within which [Mr. Farris] was exposed to asbestos fibers.” SAC at 3 15. More specifically, they allege that they have joined a substantial share of the makers of brake 4 linings and clutch facings for passenger cars and light trucks at the relevant time. Id. at 13-14. 5 Plaintiffs offer to prove the respective market share of each defendant at trial, and they allege that 6 “[t]he liability of the defendants, and each of them, is proportional to their respective market share 7 percentage.” Id. at 15. Finally, Plaintiffs assert that “the nature and structure of the market” is 8 such that “there is and was a substantial likelihood that [Mr. Farris] would have actually used or 9 otherwise been exposed to the asbestos-containing motor vehicle friction products of each of the 10 defendants.” Id. Based on these assertions, the Court holds that Plaintiffs have sufficiently pled 11 joining a “substantial share” of the relevant market to survive a Rule 12(b)(6) motion, although 12 they have not identified the specific percentage of the market controlled by each defendant. 13 Honeywell’s third argument also fails. After amending their complaint, Plaintiffs have 14 plausibly pled fungibility as set forth in Wheeler: they have identified the specific automobile 15 friction products at issue, described those products as physically interchangeable, and specified the 16 type and percentage of asbestos fiber present in those products. Compare Wheeler, 8 Cal. App. 17 4th at 1156, with SAC at 13-15. 18 Honeywell’s second argument, however, is significantly stronger. Plaintiffs assert that Mr. 19 Farris was exposed to asbestos during the installation and removal of brake linings and clutches, 20 without specifying whether his primary exposure was while installing friction products or 21 removing them. SAC at 13-14. Honeywell is correct that the allegation of primary exposure 22 during removal was critical to the holding in Wheeler. See ECF Nos. 137 at 8-10, 148 at 6-7; see 23 also Wheeler, 8 Cal. App. 4th at 1157 (observing that “the brake pads which caused the risk were 24 already unidentifiable at the time plaintiffs were exposed to their asbestos fibers” because their 25 identifying markings were worn down from use). In Wheeler, the plaintiffs’ ability to identify 26 some of the manufacturers of the new brake pads they installed did not preclude their market-share 27 liability claim “because plaintiffs alleged that the ‘vast majority’ of their exposure to brake dust 28 came from used brake pads which were unidentifiable at the time because their trade names and 7 1 trademarks had been worn off.” 8 Cal. App. 4th at 1157. Without similarly pleading that Mr. 2 Farris’s primary exposure to brake linings and clutches containing asbestos was while removing 3 them, Plaintiffs’ market-share liability claim cannot survive. CONCLUSION 4 5 6 Plaintiffs’ market-share liability claim as to all Friction Defendants. Because the complaint could 7 conceivably be cured by the allegation of additional facts, the Court will again dismiss the fifth 8 cause of action without prejudice. See Doe, 58 F.3d at 497. Plaintiffs may amend their complaint 9 within thirty days. 10 11 United States District Court Northern District of California For the foregoing reasons, the Court GRANTS Honeywell’s second motion to dismiss 12 13 IT IS SO ORDERED. Dated: April 29, 2019 ______________________________________ JON S. TIGAR United States District Judge 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 8
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