Bryant v. Technical Research Co.

• Decision Date: 31 August 1981
• Docket Number: No. 79-4514,79-4514
• Citation: Bryant v. Technical Research Co., 654 F.2d 1337 (9th Cir. 1981)
• Parties: Thomas A. BRYANT and Linda Bryant, husband and wife, Plaintiffs, v. TECHNICAL RESEARCH COMPANY, a foreign corporation, Defendant-Appellant. TECHNICAL RESEARCH COMPANY, a foreign corporation, Third-Party Plaintiff, v. EASTMAN CHEMICAL COMPANY, a foreign corporation, Third-Party Defendant-Appellee. EASTMAN CHEMICAL PRODUCTS, INC., Third-Party Plaintiff-Appellee, v. CUSTOM FURNITURE AND CABINETS, INC., an Idaho corporation, Ashland Chemical Company, a foreign corporation, and Columbia Paint Company, a foreign corporation, Third-Party Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1337

654 F.2d 1337

Thomas A. BRYANT and Linda Bryant, husband and wife, Plaintiffs, v.TECHNICAL RESEARCH COMPANY, a foreign corporation,

Defendant-Appellant.

TECHNICAL RESEARCH COMPANY, a foreign corporation, Third-Party Plaintiff, v.EASTMAN CHEMICAL COMPANY, a foreign corporation, Third-Party

Defendant-Appellee.

EASTMAN CHEMICAL PRODUCTS, INC., Third-Party Plaintiff-Appellee, v.CUSTOM FURNITURE AND CABINETS, INC., an Idaho corporation,Ashland Chemical Company, a foreign corporation, and Columbia Paint Company, a foreign

corporation, Third-Party

Defendants-Appellees.

No. 79-4514.

United States Court of Appeals Ninth Circuit.

Argued and Submitted March 4, 1981.

Decided Aug. 31, 1981.

Scott W. Reed, Coeur d'Alene, Idaho, for defendant-appellant.

Robert Crotty, Spokane, Wash., Alan R. Gardner, John Magel, Boise, Idaho, for third-party defendants-appellees.

Appeal from the United States District Court for the District of Idaho.

Before KENNEDY and BOOCHEVER, Circuit Judges, and GRAY^*, District Judge.

BOOCHEVER, Circuit Judge:

This appeal involves disputes between the defendant and third-party defendants in a products liability suit arising out of an alleged failure to provide adequate warnings.Technical Research Company(TRC), the original defendant in the products liability suit, appeals the district court's dismissal of Ashland Chemical Company, Columbia Paint Company, and Custom Furniture and Cabinets, Inc., third-party defendants, and appeals summary judgment in favor of Eastman Chemical Products, Inc., another third-party defendant.Eastman also challenges the dismissal of the other third-party defendants.We deny Ashland's and Columbia's appellate motions to dismiss because the unique circumstances of this case compel us to excuse Eastman's failure to file a formal notice of appeal.Since TRC filed a third-party complaint only against Eastman, however, it lacks standing to appeal the dismissals of the other third-party defendants and we grant those defendants' motions to dismiss as to TRC's appeal.

On the merits of the appeal, we find that summary judgment in favor of Eastman on TRC's claims was inappropriate because factual issues pertaining to the adequacy of Eastman's warnings remain to be decided.We also find that the district court erred in dismissing Eastman's third-party complaints against Ashland, Columbia, and Custom with prejudice.We therefore reverse and remand to the district court in order to determine the adequacy of Eastman's warnings.

FACTS

In 1976, Thomas Bryant and his wife filed a products liability suit against TRC in Idaho state court.Bryant claims that he was exposed to a dangerous chemical in one of TRC's products during 1973 and 1974, and consequently contracted peripheral neuropathy.¹TRC manufactured a lacquer thinner which contained methyl butyl ketone (MBK), which was used by Bryant's employer, Customer Furniture & Cabinets, Inc. Bryant alleges that long-term exposure to MBK while working in the paint spray shop at Custom caused the disease.

The chain of distribution of the MBK and the lacquer thinner was as follows: ² Eastman manufactured the MBK and sold it in bulk (by tank truck) to a distributor, Ashland.Ashland sold MBK to TRC in bulk shipments.TRC used the MBK to blend a lacquer thinner, T-6, according to its own formula.When T-6 was first marketed, methyl isobutyl ketone (MIBK) was used as a solvent instead of MBK.In 1973 when MIBK became scarce, MBK was substituted, apparently at Ashland's suggestion.Columbia, a retailer, purchased T-6 from TRC in one, five and fifty-five gallon drums.Custom purchased T-6 from Columbia, and the thinner was used extensively in Custom's paint spray room, where Bryant worked.

Bryant became ill in 1974.In 1975, his condition was diagnosed as neuropathy and traced to MBK exposure.After a long period of recovery, Bryant returned to work in 1977.Bryant's initial lawsuit was brought only against TRC.He claimed that the warnings TRC provided with T-6 were inadequate; therefore the product was defective.He sought damages of $557,000.TRC brought a third-party complaint for contribution and indemnity against the MBK manufacturer, Eastman.Eastman removed the case to Idaho federal district court based on diversity jurisdiction.28 U.S.C. §§ 1332,1441.

In federal court, Eastman brought third-party complaints against its distributor, Ashland, and the retailer, Columbia.After extensive discovery, Eastman brought a similar complaint against the employer, Custom.The plaintiff Bryant filed an amended complaint naming Eastman, Ashland, Columbia and TRC as direct defendants.Significantly, TRC never filed complaints against Ashland, Columbia or Custom.These three defendants were only in the lawsuit because of Eastman's third-party complaints and Bryant's amended complaint.

The parties filed several motions for summary judgment, dismissal, and judgment on the pleadings.Eastman, TRC and Columbia submitted affidavits regarding their knowledge of the link between MBK and neuropathy, and the extent of the instructions and warnings provided with the product.In support of its motion for summary judgment, Ashland filed a copy of its answers to TRC's interrogatories.These documents indicate disagreement over the extent and specificity of Eastman's warnings.

On June 14, 1979, the district court granted summary judgment to Eastman on TRC's third-party complaint.The court found that Eastman had provided an adequate warning to Ashland as a matter of law, and was not required to provide warnings to other members in the chain of distribution.The other defendants named in Eastman's third-party complaint, Ashland, Columbia and Custom, were dismissed because they were brought into the lawsuit only by Eastman.The court also dismissed Bryant's amended complaint against Ashland and Columbia, because it found that the Idaho statute of limitations had run before they were added as direct defendants.The district court entered a final judgment reflecting the above orders on July 20, 1979.

TRC filed a notice of appeal on August 8, 1979.³Bryant has not appealed any of the district court orders.Trial on the underlying issues of TRC's liability for injury to Bryant has apparently been delayed pending resolution of this appeal.

I. ASHLAND'S AND COLUMBIA'S MOTIONS TO DISMISS THE APPEAL

After TRC filed this appeal, Ashland and Columbia filed motions to dismiss.On March 3, 1980, a motions panel of the court referred the issue to this panel.We must first determine whether Eastman's failure to file a timely notice of appeal requires dismissal of Ashland and Columbia.We must also decide whether TRC has standing to appeal the district court judgments in favor of Ashland and Columbia.

The unique posture of this case raises difficult questions of appellate procedure and jurisdiction.In substance, Bryant is attempting to recover from any or all of the parties in the chain of distribution, with the exception of his employer, Custom.⁴The various defendants and third-party defendants are attempting to shift at least part of any eventual liability to the others in the chain of distribution.Unlike the usual multi-defendant case, however, the initial lawsuit was only against TRC, an intermediate manufacturer.Because Bryant did not appeal the dismissal of his amended complaint against Ashland and Columbia, the propriety of that dismissal is not before us.

Eastman's opposition to the motions to dismiss raises a difficult issue.The Federal Rules provide for protective or cross-appeals within 14 days of the first notice of appeal.Fed.R.App.P. 4(a)(3).It is clear that Eastman was not precluded from filing a notice of appeal even if the district court judgment can be characterized as entirely favorable.As this court has stated, "(t)he risk that (the cross-appellants) might become aggrieved upon reversal on the direct appeal is sufficient."Hilton v. Mumaw, 522 F.2d 588, 603(9th Cir.1975).Although Eastman initially had no reason to appeal the judgments dismissing Ashland, Columbia, and Custom, because Eastman had received a favorable judgment, TRC's appeal raised the possibility of reversal.Thus Eastman was put on notice that it might be brought back into the lawsuit.

Although an initial notice of appeal is mandatory and jurisdictional, ⁵ a protective or cross-appeal is only the "proper procedure," not a jurisdictional prerequisite once an initial appeal has been filed.Arnold's Hofbrau, Inc. v. George Hyman Construction Co., 480 F.2d 1145, 1150(D.C.Cir.1973);9 Moore's Federal Practice P 204.11(5)at 4-57 to 4-58(2d ed. 1980);SeeRabin v. Cohen, 570 F.2d 864, 866-67(9th Cir.1978).It has long been recognized that an appellate court has broad power to make such dispositions as justice requires.Minnesota v. National Tea Co., 309 U.S. 551, 555, 60 S.Ct. 676, 678, 84 L.Ed. 920(1940).In applying this principle, the Second Circuit allowed two non-appealing defendants to benefit from a reversal in favor of a third defendant.In re Barnett, 124 F.2d 1005, 1009(2d Cir.1941).See alsoKicklighter v. Nails By Jannee, Inc., 616 F.2d 734, 742 and n. 6(5th Cir.1980);Hysell v. Iowa Public Service Co., 559 F.2d 468, 476(8th Cir.1977).

Eastman apparently believed that TRC's notice of appeal was sufficient to bring all parties before this court.It seeks to tag onto TRC's notice of appeal, although TRC itself did not have standing to appeal.Eastman has clearly evidenced an intent to appeal through its participation, filing motions to dismiss TRC's appeal and actively opposing Ashland's and Columbia's motions.SeeRabin, 570 F.2d at 866.Eastman now requests that we exercise our discretionary power to retain all parties in the lawsuit if we remand the case, in order to insure an equitable resolution at trial.We do not condone Eastman's failure to file a protective appeal.Nevertheless, for several reasons we are compelled to...