Johnson v. American Standard, Inc.

• Decision Date: 03 April 2008
• Docket Number: No. S139184.,S139184.
• Citation: 43 Cal.4th 56,74 Cal.Rptr.3d 108,179 P.3d 905
• Court: California Supreme Court
• Parties: William Keith JOHNSON, Plaintiff and Appellant, v. AMERICAN STANDARD, INC., Defendant and Respondent.

74 Cal.Rptr.3d 108

43 Cal.4th 56

179 P.3d 905

William Keith JOHNSON, Plaintiff and Appellant, v. AMERICAN STANDARD, INC., Defendant and Respondent.

No. S139184.

Supreme Court of California.

April 3, 2008.

Metzger Law Group, Raphael Metzger, Gregory A. Coolidge, Long Beach, and Peter F. Klein, for Plaintiff and Appellant.

Steven G. Ingram and Sharon J. Arkin, Sacramento, for Consumer Attorneys for California as Amicus Curiae on behalf of Plaintiff and Appellant.

Munger, Tolles & Olson, Jeffrey L. Bleich, Kathleen M. McDowell, Paul J. Watford, Blanca Fromm Young and Aimee Feinberg, San Francisco, for Defendant and Respondent.

Hugh F. Young, Jr.; Martin, Bischoff, Templeton, Langlset & Hoffman, Jonathan M. Hoffman; Drinker Biddle & Reath and Alan Lazarus, San Francisco, for Product Liability Advisory Council, Inc., as Amicus Curiae on behalf of Defendant and Respondent.

Horvitz & Levy, David M. Axelrad, Mary-Christine Sungaila, Encino; National Chamber Litigation Center, Inc., and Robin S. Conrad, for Chamber of Commerce of the United States of America, American Chemistry Council, American International Companies, ExxonMobil Corporation, The Farmers Insurance Group of Companies and Honeywell International, Inc., as Amici Curiae on behalf of Defendant and Respondent.

Duane Morris, Robert L. Byer, Paul J. Killion and Kathryn K. Schutz, San Francisco, for FLSMIDTH, Inc., as Amicus Curiae on behalf of Defendant and Respondent.

CHIN, J.

This product liability action raises a question of first impression in California; i.e., whether we should adopt the "sophisticated user" doctrine and defense to negate a manufacturer's duty to warn of a product's potential danger when the plaintiff has (or should have) advance knowledge of the product's inherent hazards. The defense is specifically applied to plaintiffs who knew or should have known of the product's hazards, and it acts as an exception to manufacturers' general duty to warn consumers. (See Rest.2d Torts, § 402A.)

The federal courts have adopted the doctrine as an affirmative defense in diversity cases, and they predict that we will do the same. (In re Air Crash Disaster (6th Cir.1996) 86 F.3d 498, 522; In re Related Asbestos Cases (N.D.Cal.1982) 543 F.Supp. 1142, 1151 (In re Asbestos).) For the reasons discussed below, we conclude that the sophisticated user defense applies in California. We affirm the Court of Appeal judgment and remand for further proceedings consistent with this holding.

FACTS AND PROCEDURAL HISTORY

Plaintiff William Keith Johnson is a trained and certified heating, ventilation, and air conditioning (HVAC) technician. He began working in the HVAC field in 1996 when he first received training at ITT Technical Institute, where he completed a year-long course on HVAC systems. Plaintiff continued to work as an HVAC technician until 2002. He received additional training and certifications, both on and off the job, including an Environmental Protection Agency (EPA) "universal" certification after he passed a five-part exam. "Universal" certification is the highest certification an HVAC technician can obtain from the EPA, and it allows those certified to work on, and purchase, refrigerant for large commercial air conditioning systems. (40 C.F.R. §§ 82.154(m), 82.161 (2007).) "Universally" certified technicians are trained professionals, and their tasks include brazing (welding) and part replacement.

Large air conditioning systems commonly use R-22, a hydrochlorofluorocarbon refrigerant. The refrigerant can decompose into phosgene gas when exposed to flame or high heat, as could happen while a technician is brazing air conditioner pipes containing residual refrigerant. Exposure to phosgene gas may cause numerous health problems, and manufacturers and HVAC technicians have generally known of the dangers this exposure could cause since as early as 1931. The dangers and risks associated with R-22 are noted on Material Safety Data Sheets (MSDS's). (Cal.Code Regs., tit. 8, § 5194, subd. (g)(1), (2).)¹ The purpose of MSDS's is to inform those who may come into contact with potentially hazardous chemicals about their dangers. (See Cal.Code Regs., tit. 8, § 5194, subd. (g).) Employers are required to use the MSDS to train and educate their employees about the chemicals and dangers to which they may be exposed on the job. (See Cal.Code Regs., tit. 8, § 5194, subd. (h).)² Among other things, employers are required to tell employees where they can find the MSDS's, how to read them, how to detect the "presence of dangerous materials, and how to protect against possible health hazards from those materials. (Cal.Code Regs., tit. 8, § 5194, subd. (h)(2)(C), (D), (E), (F).) Beginning in 1997, every time he purchased the refrigerant R-22, plaintiff received, and sometimes read, an MSDS.

In June 2003, plaintiff filed his first amended complaint, suing various chemical manufacturers, chemical suppliers, and manufacturers of air conditioning equipment, including defendant American Standard, Inc.³ One of the systems on which plaintiff worked in 2002 was located at the Bank of America Del Amo branch. Plaintiff specifically alleged that he brazed refrigerant lines on an evaporator defendant manufactured in 1965 that contained R-22 refrigerant, creating and exposing him to phosgene gas. Plaintiff alleged that the maintenance and repairs he performed on air conditioning units in the normal course of his job created and exposed him to phosgene gas, causing him to develop pulmonary fibrosis. The causes of action against defendant are based on its alleged failure to warn of the potential hazards of R-22 exposure. They include negligence, strict liability failure to warn, strict liability design defect, and breach of implied warranties.

In each cause of action, plaintiffs theory was that defendant knew that servicing the evaporator would create harmful phosgene gas, but defendant failed to provide plaintiff with an adequate warning. (See Anderson v. Owens-Corning Fiberglas Corp. (1991) 53 Cal.3d 987, 1002, 281 Cal. Rptr. 528, 810 P.2d 549 (Anderson).) As the Court of Appeal observed, plaintiff contended that "a warning would be adequate if it informed users that brazing refrigerant lines can result in creation of phosgene, that phosgene inhalation can result in potentially fatal lung disease, that phosgene can be detected through its fresh-cut-grass smell, changes in flame color during brazing, or physical symptoms like burning eyes or shortness of breath, and that users should wear respiratory protection while brazing and stop brazing on detection of phosgene."

In May 2004, defendant moved for summary judgment on two grounds. First, the company claimed it had no duty to warn about the potential hazards of R-22 because it did not manufacture that refrigerant; it only manufactured the evaporator that contained the refrigerant. Defendant also claimed it had no duty to warn about the risks of R-22 exposure because it could assume that the group of trained professionals to which plaintiff belonged, and plaintiff himself, were aware of those risks. As the Court of Appeal observed, "the undisputed facts were that under federal law, HVAC technicians who work on commercial equipment must be certified by the EPA with `universal' certification, which is granted after an exam. They are `trained professionals.' Most HVAC technicians also have some kind of trade or professional training. [Plaintiff] had universal certification and had completed a one-year course of study in HVAC systems at ITT Technical Institute."⁴ In September 2004, the trial court granted defendant's motion for summary judgment and entered judgment in its favor on both grounds. The Court of Appeal affirmed the trial court's judgment on the sole ground that the sophisticated user defense applies in California. The court held that "a manufacturer cannot be liable to a sophisticated user of its product for failure to warn of a risk, if a sophisticated user should reasonably know of that risk." The Court of Appeal held that because plaintiffs theory was the same in all causes of action, i.e., product liability through the failure to warn, the sophisticated user defense should apply to plaintiffs complaint in its entirety.

The Court of Appeal next addressed whether defendant was entitled to summary judgment "on the theory that there was no duty to warn because the danger at issue was one generally known to members of the profession, one which [plaintiff] 'could reasonably have been expected to know' [citation] or ... [that defendant] had `reason to expect' that HVAC technicians would know of the risk."

The court observed that there was "undisputed evidence that HVAC technicians could reasonably be expected to know of the hazard of brazing refrigerant lines." Despite plaintiffs testimony that he had read the MSDS for R-22, but did not understand that he should avoid heating it, the Court of Appeal concluded that there was undisputed evidence from the relevant declarations and depositions of HVAC technicians that the EPA requires those professionals "to understand the decomposition products of refrigerants at high temperatures." The court noted that "`the study guide informed users that refrigerant in contact with high heat can form dangerous substances, and the Material Safety Data Sheet for R-22 informed technicians that the product can decompose when in contact with heat, releasing toxic gases.'" The court affirmed the summary judgment in defendant's favor. As noted, we granted review to determine whether the sophisticated user defense should apply in California.

DISCUSSION

A. Procedural Background; Summary Judgment

Because plaintiff appealed from the trial court's order granting defendant summary judgment, we independently examine the record in order to determine whether triable issues of fact exist to reinstate the action. (Saelzler v. Advanced Group 400 (2001) 25 Cal.4th 763, 767, 107 Cal.Rptr,2d 617, ...