Lopez v. Johns Manville, C84 155M.

Decision Date19 May 1986
Docket NumberNo. C84 155M.,C84 155M.
Citation649 F. Supp. 149
PartiesAlbert LOPEZ, Shirley Lopez, husband and wife, v. JOHNS MANVILLE, Amatex, Unarco, Raymark Industries, Fibreboard Corporation, Pittsburgh Corning, Owens Illinois, Owens Corning Fiberglas, Celotex, Keene Corporation v. USA.
CourtU.S. District Court — Western District of Washington

Truman R. Castle, Seattle, Wash., for plaintiffs.

Richard Hilfer, Bangs, Castle, Schnautz & Hilfer, P.S., Carney, Stephenson, Badley, Smith, Mueller & Spillman, Eileen Concannon, Garvey, Schubert, Adams & Barer, Patrick Sheldon, Karr, Tuttle, Koch, Campbell, Mawer & Morrow & Sax, Paul Gibbs, Williams, Lanza & Gibbs, Jon Hunt, Stafford, Frey & Mertel, James Murphy, Michael McKay, McKay & Gaitan, Charles Moren, Moren Lageschulte & Cornell, Seattle, Wash., Richard Feldman, Rivkin, Leff, Sherman & Radler, Garden City, N.Y., for defendants.

H. Michael Semler, JoAnn Bordeaux, Torts Div., U.S. Dept. of Justice, Washington, D.C., Chris Pickrell, Asst. U.S. Atty., Seattle, Wash., for U.S.


McGOVERN, Chief Judge.


The United States moves to dismiss the third-party claims of Raymark Industries, Inc. and Eagle-Picher Industries, Inc. or for summary judgment. This case, and eighteen others in which the United States is a third-party defendant, arises out of asbestos exposure at Puget Sound Naval Shipyard (PSNS); both manufacturers who have brought third-party claims in Washington are involved in this case, and all major legal issues are raised.

Plaintiff Albert Lopez, was a civilian pipefitter, pipecoverer, and insulator at PSNS from 1947 to 1984 and was covered by the provisions of the Federal Employees Compensation Act (FECA) 5 U.S.C. § 8101-8193. Plaintiff has received FECA benefits, but following Plaintiffs' settlements with manufacturers, the United States has recovered from him (after his deduction of costs, reasonable attorney fees, and an amount equal to 20% of the remainder) all sums it paid pursuant to FECA, as required by 5 U.S.C. § 8132.1 Plaintiff will become eligible for additional FECA payments should his medical expenses ever exceed the amount recovered from the manufacturers.

Plaintiffs filed suit against approximately 20 manufacturers and suppliers of abestos-containing products. The complaint was settled as to all manufacturers except those in bankruptcy. Meanwhile, the third-party complaints were filed. Other manufacturers dismissed their third-party claims, but Raymark and Eagle-Picher seek to recover the respective settlement amounts of $7,200 and $10,000, plus associated fees and costs. The manufacturers assert claims under the Federal Tort Claims Act (FTCA), 28 U.S.C. §§ 1346(b) and 2671-2680; the Tucker Act (contract claims), 28 U.S.C. §§ 1346(a)(2), 1402; and in admiralty.

A. Federal Tort Claims Act

The United States has waived sovereign immunity respecting tort claims in the Federal Tort Claims Act (FTCA) at 28 U.S.C. § 2674:

The United States shall be liable, respecting the provisions of this title relating to tort claims, in the same manner and to the same extent as a private individual under like circumstances,....

This waiver extends to third-party claims against the Government. United States v. Yellow Cab Co., 340 U.S. 543, 71 S.Ct. 399, 95 L.Ed. 523 (1951).

The FTCA confers the federal courts with exclusive jurisdiction over

civil actions on claims against the United States ... for injury or loss of property or personal injury or death caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

28 U.S.C. § 1346(b).

Another statute is relevant to consider in this case. A provision of the Federal Employees' Compensation Act (FECA) limits the Government's liability to employees who have received compensation under the act. 5 U.S.C. § 8116(c). This section provides in pertinent part as follows:

(c) The liability of the United States or an instrumentality thereof under this subchapter 5 USCS §§ 8101-8193 or any extension thereof with respect to the injury or death of an employee is exclusive and instead of all other liability of the United States or the instrumentality to the employee, his legal representative, spouse, dependents, next of kin, and any other person otherwise entitled to recover damages from the United States or the instrumentality because of the injury or death in a direct judicial proceeding, in a civil action, or in admiralty, or by an administrative or judicial proceeding under a workmen's compensation statute or under a Federal tort liability statute....

Thus, in return for paying benefits to injured Government employees regardless of fault, the Government is immunized from further tort liability.

1. Effect of FECA on Third-Party Indemnity/Contribution Claims

Eagle-Picher and Raymark argue that Lockheed Aircraft Corp. v. United States, 460 U.S. 190, 103 S.Ct. 1033, 74 L.Ed.2d 911 (1983) further extends the FICA waiver of sovereign immunity from tort liability to third-party claims arising out of injuries to federal employees covered by FECA.

The Government contends that Lockheed does not so extend the FTCA waiver of immunity, did not confer an indemnity/contribution action upon third parties, and that although the FECA may not directly bar such suits, the Supreme Court recognized the possibility that the underlying substantive law might. The Court in Lockheed stated in its holding:

The District Court held that Lockheed had a right to indemnity under the governing substantive law, but the Court of Appeals did not rule on that question. Accordingly, we do not consider it. We adhere to the decision in Weyerhaeuser, and hold only that FECA's exclusive-liability provision, 5 U.S.C. § 8116(c), does not directly bar a third-party indemnity action against the United States.

Id. at 199, 103 S.Ct. at 1039. The Court reasoned that FECA's exclusive-liability provision, 5 U.S.C. § 8116(c), governs only the rights of employees, their relatives, and people claiming through or on behalf of them — these being the only parties benefiting from the quid pro quo compromise of FECA — and that Congress has not modified this provision to include third parties. Id. at 193-199, 103 S.Ct. at 1036-39.

The dissenting opinion in Lockheed is of interest here because the ideas elucidated therein echo important concerns at the heart of the issues at bar. In his dissent, Justice Rehnquist distinguished earlier cases relied on by the majority where the balance struck between competing policies favored rights to recovery based on "the special relationship between the third party and the employer created by ancient maritime law or by voluntary agreement." Id. at 201, 103 S.Ct. at 1040. The only relationship that Lockheed could claim, however, continued Justice Rehnquist, was one based on the Government's breach of duty of care owed its employee. Thus, Lockheed's case involves an indirect sharing of responsibility among wrongdoers rather than a breach of direct duty owed Lockheed. Id. at 202, 103 S.Ct. at 1040-41. Therefore, concluded Justice Rehnquist,

For these reasons, I am convinced that we should retain the balance our earlier decisions would require. Where a third party has a direct action against the Government that fits into the same category as the claims we have allowed in the past, it may include a claim for damages it has paid to a Government employee. But where the third party's claim is an indirect action based on contribution or indemnity, Congress' clear intent to limit the liability of the United States should prevail.

Id. at 203, 103 S.Ct. at 1041.

Justice Rehnquist reached his conclusion by taking a broader, policy oriented perspective, and would find FECA's limitation provision waived for third-party suits only where there existed a special relationship creating direct duties. Although Eagle-Picher and Raymark assert that the Government breached independent duties owed them, this claim need not be addressed here in view of Lockheed's majority holding. For now, Lockheed will permit a third-party suit for contribution, FECA provisions creating no bar. There remains the question of whether the governing substantive law provides Eagle-Picher and Raymark with a right to indemnity.

2. Washington Law Applies
a. The Joint Tortfeasor Requirement

The FTCA requires that the court apply the law of the state "where the act or omission occurred." 28 U.S.C. § 1346(b). There is no dispute that the tortious conduct complained of occurred in Washington state.

The manufacturers apply Washington law up to a point. Eagle-Picher argues that under Washington's choice-of-law principles, the Court must consider its claim against the United States as vessel owner pursuant to the federal jurisprudence of the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 905(b).2 Under the circumstances of this case, the argument continues, Washington state courts would have to look to the federal statute to determine the liability of a private person, thus, this court must look to that law in adjudging the conduct of the Government. See, Lambertson v. United States, 528 F.2d 441, 444 (2d Cir.), cert. denied, 426 U.S. 921, 96 S.Ct. 2627, 49 L.Ed.2d 374 (1976).

Raymark comes to the same conclusion arguing that although a private employer is immune from suit by its employees and third-parties claiming noncontractual indemnity or contribution, RCW 51.04.010, Glass v. Stahl Specialties Co., 97 Wash.2d 880, 652 P.2d 948 (1982), Title 51 does not reach activity covered by maritime remedies. RCW 51.12.100. The applicable maritime remedy is the LHWCA which sanctions third-party lawsuits against the United States in its capacity as vessel owner. 33...

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