Phillips 66 Co. v. Lofton

• Decision Date: 30 August 2012
• Docket Number: No. 2010–CA–01465–SCT.,2010–CA–01465–SCT.
• Parties: PHILLIPS 66 COMPANY, Phillips Petroleum Company, ConocoPhillips Company, Drilling Specialties Company, L.L.C. a/k/a Drilling Specialties Company, LLC and Chevron Phillips Chemical Company, LP, as a Successor in Interest to Conoco Phillips Company, f/k/a Phillips Petroleum Company v. Troy LOFTON.
• Court: Mississippi Supreme Court

94 So.3d 1051

PHILLIPS 66 COMPANY, Phillips Petroleum Company, ConocoPhillips Company, Drilling Specialties Company, L.L.C. a/k/a Drilling Specialties Company, LLC and Chevron Phillips Chemical Company, LP, as a Successor in Interest to Conoco Phillips Company, f/k/a Phillips Petroleum Company

v.Troy LOFTON.

No. 2010–CA–01465–SCT.

Supreme Court of Mississippi.

June 7, 2012.

Rehearing Denied Aug. 30, 2012.

John Jeffrey Trotter, Holmes S. Adams, Bernard Hess Booth, IV, Ridgeland, Terry L. Caves, Laurel, Alex E. Cosculluela, A. Christopher Derden, attorneys for appellants.

Gregory Neill Jones, S. Robert Hammond, Jr., Hattiesburg, J. Robert Sullivan, Sr., Laurel, James Robert Sullivan, Jr. attorneys for appellee.

Before WALLER, C.J., KITCHENS and KING, JJ.

KITCHENS, Justice, for the Court:

¶ 1. Troy Lofton alleges that he suffers from asbestosis as a result of exposure to the defendant's product, Flosal, during the course of his employment on various oil and gas drilling rigs. Lofton filed suit on May 19, 2004, alleging two theories of product liability (design defect and inadequate warning), as well as claims for intentional and negligent infliction of emotional distress. Following a jury trial in the Second Judicial District of the Circuit Court of Jones County from March 29, 2010, through April 8, 2010, the jury returned a verdict in favor of Lofton on his claims of design defect and negligent infliction of emotional distress, with one hundred percent of the liability assigned to Chevron Phillips Chemical Company LP, successor-in-interest to ConocoPhillips Company, formerly known as Phillips Petroleum Company, and Phillips 66 Company, formerly doing business as Drilling Specialties Company (“CPChem”) and total damages in the amount of $15,200,000. CPChem's motion for judgment notwithstanding the verdict and its motion for new trial and/or remittur were denied. Aggrieved, CPChem filed this appeal.

¶ 2. We reverse and remand for a new trial due to the trial court's error in allowing Lofton's counsel to read from drilling records that were not admitted into evidence during the cross-examination of CPChem's expert pulmonologist, Dr. Robert Ross.

Facts and Procedural History

¶ 3. From 1963 through 1984, CPChem manufactured a product called Flosal, which contained 85–95% asbestos and was used as a drilling mud additive. The product was a viscosifier, and was used to increase the viscosity of (to thicken) drilling mud fluids. Drilling mud refers to the fluids used on an oil-drilling rig to lift cuttings—the dirt, rock or shale that had been drilled—from the bottom of the well bore to the surface. It then is pumped down the well bore via a drill pipe, through the drill bit, and back to the surface, carrying with it the cuttings.

¶ 4. Lofton worked on several oil and gas rigs from 1964 to 1983. He worked as a floorhand, mixing drilling mud and maintaining mud pumps, as well as a motorman, with responsibility for all the motors on the drilling rig. In these positions, Lofton worked with viscosifiers, including CPChem's product, Flosal.

¶ 5. Lofton's medical records indicate that, in 1995, he was experiencing shortness of breath. A chest x-ray from 1995 revealed pulmonary fibrosis, or scarring of the lungs. A subsequent computed tomography (CT) scan of Lofton's lungs from 1996 also indicated pulmonary fibrosis. Lofton testified at trial that he was not treated for the fibrosis at that time, nor was he made aware of its etiology. He sought treatment for his pulmonary symptoms in 2003 with Dr. Stogner, a pulmonologist, who diagnosed Lofton with pulmonary fibrosis. In 2004, Dr. Stogner noted that Lofton likely was suffering of pneumoconiosis, also know as asbestosis. After ruling out other etiologies, Dr. Stogner conclusively diagnosed Lofton with asbestosis in 2010. Asbestosis is a progressive disease caused by scar tissue in the lungs as a result of the body's response to the presence of asbestos fibers in the lungs. An individual with asbestosis does not develop symptoms until about fifteen to thirty years after exposure.

¶ 6. At the time of trial, Lofton testified that he was on oxygen for eighteen to twenty hours a day. Dr. Stogner testified that, in the event of infection, Lofton would require oxygen twenty-four hours a day and would be at high risk of smothering. According to Dr. Stogner, Lofton's condition will never improve. Dr. Stogner testified that Lofton's life expectancy has been reduced.

¶ 7. The predecessor to this case, styled Lambert, et al. v. Phillips 66 Co., et al., Civil Action No.2004–85–CV5, was filed in Jones County, Mississippi, on May 19, 2004. In the original complaint, Lofton was one of twenty-three plaintiffs who had filed suit against various defendants, all of whom were manufacturers, distributors, and/or users of asbestos products to which claimants allegedly were exposed and by which they allegedly were injured. The circuit court adopted the report and recommendations of the appointed special master and severed the claims on the basis of improper joinder, including Lofton's claim.

¶ 8. On March 8, 2006, Lofton filed his individual third amended complaint in the circuit court of the Second Judicial District of Jones County, Mississippi. ¹ The complaint alleged that the “Asbestos Defendants,” who were “in the business of manufacturing and distributing products containing asbestos” had “actual knowledge of the unreasonably dangerous propensities of asbestos.” Lofton alleged the defendants were strictly liable for “their products and for the failure to properly warn [Lofton] about the dangers of their product.” Lofton further alleged intentional and negligent infliction of emotional distress. He sought economic, noneconomic, and punitive damages. By the time of trial, the only remaining defendant was Chevron Phillips Chemical Company LP, successor-in-interest to ConocoPhillips Company formerly known as Phillips Petroleum Company, and Phillips 66 Company formerly doing business as Drilling Specialties Company (“CPChem”).

¶ 9. Following a two-week jury trial, with the Honorable Billy Joe Landrum presiding, the jury returned a verdict in favor of Lofton, assigning one hundred percent liability to CPChem and awarding total damages in the amount of $15,200,000, later adjusted by the trial court to $15,198,407.66, with $198,407.66 in compensatory damages and $15,000,000 in noneconomic damages. ² CPChem's motion for judgment notwithstanding the verdict and motion for new trial and/or remittitur were denied. Aggrieved, CPChem filed this appeal.

¶ 10. CPChem presents the following issues ³ for this Court's review:

(1) Whether Lofton's claims are time-barred by the three-year statute of limitations.

(2) Whether Lofton's design-defect claim fails as a matter of law due to (a) a failure to overcome CPChem's inherent-characteristic defense pursuant to Mississippi Code Section 11–1–63(b); (b) a failure to prove the product failed to function as expected; (c) a failure to prove a feasible design alternative for Flosal; (d) a failure to prove the frequency, regularity, and proximity of exposure to the product.

(3) Whether Lofton's negligent-infliction-of-emotional-distress claim is subsumed by the Mississippi Products Liability Act (MPLA), or in the alternative, whether his testimony was insufficient as a matter of law to establish his claim.

(4) Whether CPChem is entitled to a new trial because the trial court abused its discretion in (a) denying a change of venue, (b) admitting the testimony of Lofton's industrial hygiene expert, (c) allowing Lofton's counsel to use drilling records that were not admitted into evidence in the irrelevant and prejudicial cross-examination of CPChem's pulmonologist.

(5) Whether CPChem is entitled to a new trial because the jury's verdict is against the overwhelming weight of the evidence and demonstrates bias, prejudice, and passion due to the jury's failure to allocate liability against responsible third parties.

(6) Alternatively, should the Court decline to reverse and render in favor of CPChem or to order a new trial, is CPChem entitled to a remittitur because the jury's allocation of liability and damages was not supported by the evidence?

¶ 11. Additionally, CPChem has raised the issue of whether remarks made by the trial judge and Lofton's counsel prejudiced the defense and resulted in bias on the part of the jury, such that a new trial is warranted. Given that this Court finds that a new trial is warranted on other grounds, we decline to address any specific remarks made during voir dire in the instant case.

Discussion

I. Whether Lofton's claims are time-barred by the three-year statute of limitations.

¶ 12. The threshold issue in the instant case is whether Lofton's claims are time-barred by the three-year statute of limitations found in Mississippi Code Section 15–1–49 (Rev.2003). This Court applies a de novo standard of review to statutes of limitation. Lincoln Elec. Co. v. McLemore, 54 So.3d 833, 835 (Miss.2010) (citing Harris v. Darby, 17 So.3d 1076, 1078 (Miss.2009); Ellis v. Anderson Tully Co., 727 So.2d 716, 718 (Miss.1998)).

¶ 13. In cases of latent injury, such as the instant case, Section 15–1–49(2) provides:

In actions for which no other period of limitation is prescribed and which involve latent injury or disease, the cause of action does not accrue until the plaintiff has discovered, or by reasonable diligence should have discovered, the injury.

Miss.Code Ann. § 15–1–49(2) (Rev.2003).

¶ 14. CPChem asserts that, under Section 15–1–49(2), the clock began running upon discovery of the injury to his lungs—when his doctors found pulmonary fibrosis in his lungs in 1995, or at the latest, 1996—not upon discovery of the injury's cause (asbestos exposure). CPChem cites evidence from the record that Lofton's medical records indicate that he was experiencing shortness of breath as early as 1995 and that a CT scan performed on Lofton's lungs in 1995...