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Media Alerts - Ripley v. Foster Wheeler LLC -- Fourth Circuit
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November 17, 2016
  Ripley v. Foster Wheeler LLC -- Fourth Circuit
Scope of "Government Contractor Defense" Expanded to Apply in Failure to Warn Cases

Areas of Law: Products Liability, Federal Jurisdiction

Issue presented: Whether the "government contractor defense" is available to defendants in failure to warn cases.

Brief Summary: The United States Court of Appeals for the Fourth Circuit rejected Eastern District of Virginia guidance which limited the "government contractor defense" to design defect cases. The same rationales that the Supreme Court offered for the defense in design defect cases apply equally to failure to warn claims. Therefore, the Fourth Circuit held that the government contractor defense is available in failure to warn cases.

Extended Summary: Bernard W. Ripley was diagnosed with malignant mesothelioma twenty-five years after he stopped working as a boilermaker at Norfolk Naval Shipyard. Mr. Ripley and his wife brought suit in Virginia state court against multiple defendants including Foster Wheeler LLC and Foster Wheeler Energy Corporation ("Foster"). The complaint alleged that Mr. Ripley was exposed to asbestos contained in products that Foster manufactured for the Navy. The complaint further alleged that Foster failed to warn of the asbestos hazards.

Foster filed a notice of removal in the United States District Court for the Eastern District of Virginia. Foster claimed removal was appropriate under the federal officer removal statute, 28 U.S.C. § 1442(a)(1). To remove a case under this statute, a defendant must establish: "(1) that it is a federal officer or 'a person acting under that officer,'" "(2) a 'colorable federal defense'; and (3) that the suit is 'for an act under color of office.'" Foster asserted a government contractor defense to satisfy the colorable federal defense element. The district court, however, remanded the case to state court, reiterating its "decades-old practice" of denying the government contractor defense in failure to warn cases. Without the defense, the district court did not have federal subject matter jurisdiction.

Foster appealed, asking the Fourth Circuit to reverse the remand order. The Fourth Circuit reversed and remanded the case to the federal trial court, holding that the government contractor defense is available in failure to warn cases and instructing the district court to determine whether Foster presented sufficient proof to warrant removal under the federal officer removal statute.

The Fourth Circuit began by reviewing the United States Supreme Court case Boyle v. United Technologies Corp., 487 U.S. 500 (1988). In Boyle, the Court announced that "design defects in military equipment do not give rise to state-law tort claims if" the three elements of the government contractor defense are satisfied. The Court offered two rationales for the defense. First, separation of powers suggests that the judiciary should be hesitant to interfere with complex military decision-making made by the branches constitutionally delegated with the war powers. Second, if government contractors are required to take on a higher risk of liability, they will pass those costs on to the government; meaning that the supply of contractors, as well as research and development in military equipment, will decrease.

After the Fourth Circuit reviewed both of these rationales, it held that the government contractor defense may apply in failure to warn cases for two reasons. First, the Eastern District of Virginia was an "outlier" in failing to recognize the government contractor defense in failure to warn cases. The Second, Fifth, Sixth, Seventh, Ninth and Eleventh Circuits have all applied the defense to failure to warn cases. Second, the rationales articulated by the Supreme Court for applying the defense in design defect cases apply with equal force to failure to warn cases. The judiciary should be hesitant to interfere with the complex warning and labeling requirements particular to military procurement contracts and specifications. Furthermore, the effect on government contractors is the same regardless of whether they are forced to take on a higher risk of liability for design defect or failure to warn claims.

To read the full opinion, click here.

Panel: Judges Traxler, Diaz, and Thacker

Argument Date: 09/22/2016

Date of Issued Opinion: 11/1/2016

Docket Number: No. 15-1918

Decided: Reversed and remanded by published opinion.

Case Alert Author: Annie McGuire, Univ. of Maryland Carey School of Law

Counsel:
ARGUED: Erik David Nadolink, WHEELER TRIGG O'DONNELL, LLP, Denver, Colorado, for Appellants. William Harty, PATTEN, WORNOM, HATTEN & DIAMONSTEIN, L.C., Newport News, Virginia, for Appellee. ON BRIEF: Anthony B. Taddeo, Jr., David M. Sturm, Matthew D. Joss, TADDEOSTURM PLC, Richmond, Virginia, for Appellants. Robert R. Hatten, Hugh B. McCormick, III, PATTEN, WORNOM, HATTEN & DIAMONSTEIN, L.C., Newport News, Virginia, for Appellee.

Author of Opinion: Judge Thacker

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/17/2016 08:35 AM     4th Circuit  

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