Murphy v. Owens-Illinois, Inc., OWENS-ILLINOI

• Decision Date: 19 December 1985
• Docket Number: OWENS-ILLINOI,INC,No. 84-6021,84-6021
• Citation: 779 F.2d 340
• Parties: 19 Fed. R. Evid. Serv. 821, Prod.Liab.Rep.(CCH)P 10,906 Claude E. MURPHY and Jean Virginia Murphy, Plaintiffs-Appellants, v., Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 340

779 F.2d 340

19 Fed. R. Evid. Serv. 821, Prod.Liab.Rep.(CCH)P 10,906

Claude E. MURPHY and Jean Virginia Murphy, Plaintiffs-Appellants, v. OWENS-ILLINOIS, INC., Defendant-Appellee.

No. 84-6021.

United States Court of Appeals Sixth Circuit.

Argued Oct. 30, 1985.

Decided Dec. 19, 1985.

Sherman Ames, III (Lead), Gillenwater, Nichol and Ames, Knoxville, Tenn., Paul T. Gillenwater (argued), H. Douglas Nichol, for plaintiffs-appellants.

Louis C. Woolf (argued), J. Randolph Bibb, Jr. (Lead), Robert G. McDowell, Baker, Worthington, Crossley, Stansberry and Woolf, Nashville, Tenn., for defendant-appellee.

Before ENGEL, KENNEDY and KRUPANSKY, Circuit Judges.

CORNELIA G. KENNEDY, Circuit Judge.

Plaintiffs Claude and Jean Murphy appeal various rulings of the District Court in this products liability action filed against several manufacturers of asbestos-containing insulation products. Mr. Murphy allegedly contracted the disease asbestosis from exposure to the products. He sued for damages arising from his injury; his wife sued for damages for loss of services and consortium. After several defendants settled, only Owens-Illinois, Inc. remained. The jury returned a verdict in favor of the defendant and judgment was entered accordingly on August 10, 1984.

Plaintiffs raise three issues on appeal. First, they claim that the District Court erred in refusing to grant their motion for a directed verdict at the conclusion of all proof. Second, they charge error in the court's exclusion from evidence of a deposition taken in a previous asbestosis case. Finally, they challenge the jury instructions in one instance. Having considered these claims, the Court affirms the judgment of the District Court.

I

Plaintiffs contend that the uncontroverted evidence at trial established that Mr. Murphy was exposed to asbestos dust from an asbestos-containing product (Kaylo) manufactured by Owens-Illinois, that this exposure was a substantial factor contributing to his asbestosis, and that Owens-Illinois never warned or otherwise instructed Mr. Murphy as to the hazards associated with the use of its product. Plaintiffs argue that this evidence entitled them to a directed verdict under the law of strict liability in Tennessee, as embodied in Restatement (Second) of Torts Sec. 402A (1977). ¹ Specifically, plaintiffs contend that any evidence as to the "state of the art" at the time of the manufacture of the product was irrelevant and inappropriate.

Evidence of the "state of scientific and technological knowledge available to the manufacturer or seller at the time the product was placed on the market" is now allowed in Tennessee by reason of the Tennessee Products Liability Act of 1978, Tenn.Code Ann. Sec. 29-28-101, et seq. Plaintiffs note, however, that the relevant section, Sec. 105, was enacted after the instant case was filed. The central question, therefore, is whether the statute changed the law of Tennessee.

Evidence of the "state of the art" was clearly allowed before the statute was enacted. In Ellithorpe v. Ford Motor Co., 503 S.W.2d 516 (Tenn.1973), the Tennessee Supreme Court stated that the manufacturer of an automobile was under a duty to build a product " 'as safe as is reasonably possible under the present state of the art.' " 503 S.W.2d at 519, quoting Larsen v. General Motors Corp., 391 F.2d 495 (8th Cir.1968). One law review commentator has noted that the statute did not change the law in Tennessee. Note, The Tennessee Products Liability Act, 9 Mem.St.U.L.Rev. 105, 126 (1978). See also Abbott v. American Honda Motor Co., 682 S.W.2d 206, 211 (Tenn.App.1984) (upholding jury instruction on the state of the art: "The language used by the trial judge closely followed that of the statute and was in conformity with our case law. See Ellithorpe, supra, at 519.")

In a consideration of the "state of the art," available scientific and technological knowledge, customary practice and industry standards are all relevant. The evidence elicited at trial presented a jury question as to whether the Owens-Illinois product was "defective" given the available knowledge at the time, custom, and industry standards. Specifically, the testimony of defendant's witness Dr. H. Corwin Hinshaw posited that during the time Mr. Murphy was allegedly exposed to asbestos dust, the medical community understood that five mppcf (million particles per cubic foot) was a safe level of exposure for insulation installers. Plaintiff's own expert witness confirmed this testimony.

Furthermore, the evidence presented a jury question as to whether or not plaintiff's exposure to Owens-Illinois' product, Kaylo, was a substantial factor in causing his asbestosis. The District Court was correct in denying plaintiffs' motion for a directed verdict given the factual questions presented.

II

Plaintiffs argue that if "state of the art" evidence is admissible and proper, the deposition of Dr. Kenneth Wallace Smith, deceased, former Medical Director of the Johns-Manville Corp., was improperly excluded from jury consideration. This deposition was taken January 13, 1976, in the case of DeRocco v. Forty-Eight Insulation, Inc., No. 2880 (Pa.Ct.Com.Pleas 1974). The Smith deposition has spawned a small body of case law all its own. ² Smith, as former Medical Director of the leading manufacturer of asbestos-containing products, was in a unique position to discuss the scope of knowledge available to the industry during his twenty-year tenure at Johns-Manville. ³

Plaintiffs contend that as Smith is no longer available, under Fed.R.Evid. 804(b)(1) his testimony in the DeRocco case should have been admitted at trial as tending to prove that the knowledge available to Owens-Illinois in the late 1940's and early 1950's placed upon it a duty to warn of the hazards associated with its product. The rule provides:

(b) HEARSAY EXCEPTIONS. The following are not excluded by the hearsay rule if the declarant is unavailable as a witness:

(1) FORMER TESTIMONY. Testimony given as a witness at another hearing of the same or a different proceeding, or in a deposition taken in compliance with the law in the course of the same or another proceeding, if the party against whom the testimony is now offered, or, in a civil action or proceeding, a predecessor in interest, had an opportunity and similar motive to develop the testimony by direct, cross, or redirect examination.

Fed.R.Evid. 804(b)(1)

Owens-Illinois was not a party in the DeRocco case. In that event, Rule 804(b)(1) requires that Owens-Illinois (1) have had a predecessor in interest at the former proceeding who (2) had an opportunity and similar motive to develop the testimony by cross-examination. This Court has, in effect, collapsed the two criteria into one test in Clay, supra n. 2. The Court in Clay adopted the position taken by the Third Circuit in Lloyd v. American Export Lines, Inc., 580 F.2d 1179 (3d Cir.), cert. denied, 439 U.S. 969, 99 S.Ct. 461, 58 L.Ed.2d 428 (1978). That court held that a "previous party having like motive to develop the testimony about the same material facts is, in the final analysis, a predecessor in interest to the present party." 580 F.2d at 1187. The Clay Court went on to hold that the Smith deposition should have been admitted in that case, even though defendant Raybestos had not been present in DeRocco. The Court stated that "[o]ur examination of the record submitted in this case satisfies us that defendants in the DeRocco case had a similar motive in confronting Dr. Smith's testimony, both in terms of appropriate objections and searching cross-examination, to that which Raybestos has in the current litigation." 722 F.2d at 1295.

Defendant Owens-Illinois argues, however, that indeed there was no one present at the Smith deposition with a similar motive to its own to develop the testimony. It bases its position on the fact that Owens-Illinois ceased to manufacture or sell the asbestos-containing product at issue in 1958. ⁴ Counsel for defendant noted during argument on the motion to admit the deposition that

"Johns-Manville and Raybestos-Manhattan can't afford to prove the same State of the Art that Owens-Illinois proves in the 1940s and 1950s because they would slit their throat when they dramatize the difference between that State of the Art and the State of the Art in the 1960s and 1970s when they continued to manufacture asbestos insulation products."

The District Court ruled that the cross-examiners in DeRocco had a dissimilar motive from Owens-Illinois' and excluded the deposition. Cognizant of this Court's decision in Clay, it distinguished it on that ground. We hold that the District Court did not abuse its discretion in so ruling on the 804(b)(1) exception.

Similarly, we hold that the District Court did not abuse its discretion in ruling that the deposition was more prejudicial than probative. Fed.R.Evid. 403. As indicated above, Smith testified as to the knowledge available in the industry through 1966, when he left Johns-Manville. He also testified as to specific recommendations he made to management at Johns-Manville, based on his understanding of the hazards of asbestos. Portions of his testimony, those dealing with industry knowledge after 1958 and those dealing with his own suggestions about how Johns-Manville should respond to asbestosis hazards, would not have been probative as to the knowledge available generally ⁵ in the industry before 1958. The underlying factual basis for Smith's conclusions was available to the industry, and he indicated in his testimony that he reported certain of his findings outside his own corporation. Thus, portions of the deposition are probative of the state of the art at that time. The difficulty is that portions of the deposition testimony, particularly Johns-Manville's refusal to heed his advice, are highly prejudicial as well. Counsel for plaintiffs stated at argument that punitive damages have been assessed against Johns-Manville...