Court Opinion

ID: 3205823
Source: CourtListenerOpinion
Date Created: 2016-05-23 17:03:38.452206+00
Date Added: 2024-06-11T14:45:47.258669
License: Public Domain

Filed 5/23/16

      IN THE SUPREME COURT OF CALIFORNIA

WILLIAM B. WEBB et al.,               )
                                      )
           Plaintiffs and Appellants, )                           S209927
                                      )
           v.                         )                     Ct.App. 2/1 B233189
                                      )
SPECIAL ELECTRIC COMPANY, INC., )                          Los Angeles County
                                      )                  Super. Ct. No. BC436063
           Defendant and Respondent. )
____________________________________)

        Plaintiff William Webb was injured by exposure to asbestos products and
sued a raw asbestos supplier for failing to warn him about the danger. His case
raises a question about the extent of a supplier‟s duty to warn. Specifically, when
a company supplies a hazardous raw material for use in making a finished product,
what is the scope of the supplier‟s duty to warn ultimate users of the finished
product about risks related to the raw material? The answer implicates a defense
known as the sophisticated intermediary doctrine.1 Although all sellers in a

1      Terminology in this area of law is notoriously confusing. We retain the
name used in California cases to describe the defense arising from the Restatement
Third of Torts, Products Liability (1998) section 2, comment i, page 30, and its
predecessor, the Restatement Second of Torts (1965) section 388, comment n,
page 307. (See Pfeifer v. John Crane, Inc. (2013) 220 Cal.App.4th 1270, 1292;
Stewart v. Union Carbide Corp. (2010) 190 Cal.App.4th 23, 29-30). Elsewhere,
the defense has sometimes been called the “sophisticated purchaser” (Cabasug v.
Crane Co. (D. Haw. 2013) 988 F.Supp.2d 1216, 1224-1228; In re Asbestos
Litigation (Del.Ct.App. 1986) 542 A.2d 1205, 1209) or “learned intermediary”
(Aubin v. Union Carbide Corp. (Fla. 2015) 177 So.3d 489, 516, 518; Humble Sand
& Gravel, Inc. v. Gomez (Tex. 2004) 146 S.W.3d 170, 190) defense. The

                SEE CONCURRING AND DISSENTING OPINION
product‟s distribution chain have a duty to warn about known hazards, they may in
some cases discharge that duty by relying on others to warn downstream users.
(Rest.3d Torts, Products Liability, § 2, com. i, p. 30.)
       When a hazardous raw material is supplied for any purpose, including the
manufacture of a finished product, the supplier has a duty to warn about the
material‟s dangers. Under the sophisticated intermediary doctrine, the supplier
can discharge this duty if it conveys adequate warnings to the material‟s
purchaser, or sells to a sufficiently sophisticated purchaser, and reasonably relies
on the purchaser to convey adequate warnings to others, including those who
encounter the material in a finished product. Reasonable reliance depends on
many circumstances, including the degree of risk posed by the material, the
likelihood the purchaser will convey warnings, and the feasibility of directly
warning end users. The doctrine balances the competing policies of compensating
those injured by dangerous products and encouraging conduct that can feasibly be
performed.
                                 I. BACKGROUND
       During the 1970s, Special Electric Company, Inc. (Special Electric)
brokered the sale of crocidolite asbestos to Johns-Manville Corporation (Johns-
Manville). Crocidolite is the most toxic form of asbestos, several times more
likely to cause cancer than the more common chrysotile form.2 Nevertheless, one

Massachusetts Supreme Court called it the “bulk supplier” defense (Hoffman v.
Houghton Chemical Corp. (Mass. 2001) 751 N.E.2d 848, 854-857); however, as
we will discuss, that latter term has come to describe a slightly different tort
doctrine. (See post, at pp. 11-13.)
2       “The term „asbestos‟ describes six fibrous minerals which fall into two
varieties, amphibole and serpentine. The serpentine mineral, chrysotile, is the
most commonly used in building products, and makes up more than 90% of all
asbestos used. When mined and processed, asbestos is generally separated into
thin fibers which are then mixed with a binding agent so the fibers may be used in
various products.” (Matter of Celotex Corp. (Bankr. M.D.Fla. 1996) 196 B.R.
973, 980, fns. omitted.) Individual asbestos fibers are invisible to the naked eye.
                                           2
Special Electric broker claimed crocidolite was “safer” than other forms of
asbestos because he believed it did not become airborne.
       Special Electric arranged for the material to be shipped directly from a
mining company in South Africa to Johns-Manville plants. It received a
commission for the brokered sales but never took possession of the asbestos.3
Johns-Manville required that the asbestos be shipped in bags with an OSHA
warning label, stating: “Caution, contains asbestos fibers. Avoid creating dust.
Breathing asbestos dust may cause serious bodily harm.” However, the general
supervisor of Johns-Manville‟s Long Beach plant recalled that bags of crocidolite
did not bear the labels until the early 1980s.
       Johns-Manville was the oldest and largest manufacturer of asbestos-
containing products in the country, maintaining plants across the United States and
overseas. It also owned and operated a mine in Quebec that was one of the
world‟s largest sources of chrysotile asbestos. Founded in 1858, the company
once had 30,000 employees. Its numerous asbestos products included flooring,
roofing, siding, cement, and pipe insulation. It also made an asbestos cement pipe
known as Transite pipe. Although “Transite” was trademarked by Johns-
Manville, the name became a generic term for all brands of asbestos cement pipe.
       Although not asked about crocidolite specifically, plaintiffs‟ epidemiologist
knew of no company in the United States more knowledgeable about asbestos than

If released, they may become airborne and inhaled. Asbestos that becomes
crumbly or easily broken apart is described as friable and is known to pose a
health risk. (Ibid.)
3        The company that actually made the sales was named Special Materials,
Inc. Although the record does not clearly describe their relationship, it is alleged
and undisputed here that Special Electric is liable as a successor for the torts of
Special Materials. Special Electric has argued throughout the proceedings that, as
a mere broker, it was not in the product‟s chain of distribution for purposes of
strict liability. This argument was not addressed by either of the courts below.
Accordingly, the issue is beyond the scope of our grant of review and we do not
consider it.

                                          3
Johns-Manville. As early as the 1930s, it was aware of health hazards associated
with exposure. It acquired the substance from many different sources and did not
look to its suppliers for information about safe handling. The company had a
well-established research department where the chemical characteristics of
asbestos were studied. On occasion, Johns-Manville scientists would meet with
Special Electric and other vendors to discuss research. By the 1950s, Johns-
Manville had instituted precautions for safe handling in its facilities.
         Johns-Manville‟s Long Beach plant manufactured Transite pipe. While the
formula did not call for crocidolite asbestos, trace amounts of it could be found in
the pipe because Johns-Manville recycled broken or damaged bits of other
products during manufacture. Scraps could comprise up to 20 percent of the
components, so long as the asbestos fiber count was kept within a prescribed
range.
         Johns-Manville sold Transite pipe through various distributors, including
Familian Pipe & Supply. Familian, in turn, sold the pipe to Pyramid Pipe &
Supply Co., where plaintiff William B. Webb worked as a warehouseman and
truck driver. Between 1969 and 1979, Webb handled the product as part of his
job. About 10 times a year, he made deliveries to job sites. The pipe left a dusty
residue when handled but bore no warning label. Webb was not told that Transite
pipe dust could cause cancer, nor was he advised to wear a respirator.
         In January 2011, Webb was diagnosed with mesothelioma, a fatal cancer
caused by inhalation of asbestos fibers. He and his wife, Jacqueline Webb, sued
multiple defendants under strict liability and negligence theories. They ultimately
went to trial against Special Electric and two other companies. At the close of
plaintiffs‟ case, Special Electric moved for nonsuit on the failure to warn claims.
Special Electric argued, in part, that it had no duty to warn a sophisticated
purchaser like Johns-Manville about the health risks of asbestos. The court
deferred ruling pending further briefing. After both sides rested, Special Electric
moved for a directed verdict on plaintiffs‟ strict liability claims. The court again

                                           4
deferred ruling. The jury returned a verdict finding Special Electric liable for
failure to warn and negligence, but not liable for supplying a defectively designed
product.4 It apportioned 49 percent of fault to Johns-Manville, 18 percent to
Special Electric, and 33 percent to other entities.
       Before judgment was entered, Special Electric requested a ruling on its
nonsuit and directed verdict motions. The court determined Special Electric was
not liable for failure to warn and granted the motions. Concerned that these
rulings might be procedurally irregular, the court also entered judgment on the
jury verdict and construed the motions as seeking judgment notwithstanding the
verdict (JNOV). So characterized, the motions were granted and judgment was
entered in favor of Special Electric.
       A divided panel of the Court of Appeal identified both procedural and
substantive error. The majority determined the JNOV ruling was impermissibly
premature and lacked the required written notice. It also concluded the entry of
JNOV was improper because substantial evidence demonstrated that Special
Electric breached a duty to warn Johns-Manville and foreseeable downstream
users like Webb about the risks of asbestos exposure. The dissenting justice
argued JNOV was proper because Special Electric was entitled to rely on Johns-
Manville, a sophisticated purchaser, to warn downstream users about asbestos, and
plaintiffs suffered no prejudice from procedural irregularities in the ruling.5
       We granted review and now affirm. Because substantial evidence supports
the jury‟s verdict, and Special Electric did not have a complete defense as a matter
of law, the entry of JNOV was unjustified. In light of this conclusion, we need not
reach plaintiffs‟ claims of procedural error.

4      Plaintiffs had alleged a design defect under the consumer expectations test.
(See post, p. 7; see also Arena v. Owens-Corning Fiberglas Corp. (1998) 63
Cal.App.4th 1178.)
5      Plaintiffs‟ appeal also challenged the jury verdict absolving Special Electric
of design defect liability. The Court of Appeal did not reach this claim.

                                           5
                                  II. DISCUSSION
       A product can be defective in its manufacture or design, or because it fails
to include a warning about known risks. (Rest.3d Torts, Products Liability, § 2.)
Several defenses may be asserted against a failure to warn claim. Two of these are
the obvious danger rule and its subset, the sophisticated user rule. (See Johnson v.
American Standard, Inc. (2008) 43 Cal.4th 56 (Johnson).) Another relevant
defense is the component parts rule. (See O’Neil v. Crane Co. (2012) 53 Cal.4th
335.) The bulk supplier doctrine, a corollary of the component parts rule,
addresses the special considerations that may apply when the component is a raw
material as opposed to a manufactured item. (Artiglio v. General Electric Co.
(1998) 61 Cal.App.4th 830, 837.) We discuss the development and application of
these doctrines in greater detail below.
       This case involves a hazardous raw material incorporated in a finished
product. The critical inquiry is whether and to what extent the supplier can
discharge its duty to warn by relying on others to convey warnings about the
hazard. As we will explain, the sophisticated intermediary doctrine provides that a
supplier can discharge its duty to warn if it provides adequate warnings, or sells to
a sufficiently sophisticated buyer, and reasonably relies on the buyer to warn end
users about the harm. Reasonable reliance depends on all attendant circumstances
and is typically a question of fact for the jury.
       1.     General Principles Concerning the Duty to Warn of Product
              Dangers
              a.      Types of Product Defects
       The law has long recognized three types of product defects: manufacturing
defects, design defects, and “ „warning defects.‟ ” (Anderson v. Owens-Corning
Fiberglas Corp. (1991) 53 Cal.3d 987, 995 (Anderson); see Barker v. Lull
Engineering Co. (1978) 20 Cal.3d 413, 428 (Barker).) Manufacturing defects can
arise, for example, when a flaw in the manufacturing process creates a product that
differs from what the manufacturer intended. (Brown v. Superior Court (1988) 44

                                           6
Cal.3d 1049, 1057 (Brown).) The exploding bottle in Escola v. Coca Cola
Bottling Co. (1944) 24 Cal.2d 453 is the prototypical example of a manufacturing
defect. (See Brown, at p. 1057.)
       Design defects appear in products that, although properly manufactured, are
dangerous because they lack a critical feature needed to ensure safe use. (Brown,
supra, 44 Cal.3d at p. 1057.) We discussed design defects at length in Barker,
supra, 20 Cal.3d 413, establishing two alternative tests for liability. A product
design may be found defective if: (1) “the product failed to perform as safely as
an ordinary consumer would expect when used in an intended or reasonably
foreseeable manner” (consumer expectations test) (id. at p. 432); or (2) the risk of
danger inherent in the product‟s design outweighs the design‟s benefits (risk-
benefit test) (ibid.).
       The third type of defect “is a product that is dangerous because it lacks
adequate warnings or instructions.” (Brown, supra, 44 Cal.3d at p. 1057; see
Barker, supra, 20 Cal.3d at p. 428.) “Generally speaking, manufacturers have a
duty to warn consumers about the hazards inherent in their products.” (Johnson,
supra, 43 Cal.4th at p. 64.) A warning informs consumers about hazards of which
they are unaware, so that they can avoid the product or minimize its danger by
careful use. (Ibid.) In California, as in a majority of jurisdictions, liability for
failure to warn is conditioned on the manufacturer‟s actual or constructive
knowledge of the risk. (Anderson, supra, 53 Cal.3d at p. 1000; Brown, at
p. 1066.) The duty to warn applies to all entities in a product‟s chain of
distribution. (See Taylor v. Elliott Turbomachinery Co. Inc. (2009) 171
Cal.App.4th 564, 575.) Thus, like a manufacturer, a raw material supplier has a
duty to warn about product risks that are known or knowable in light of available
medical and scientific knowledge. (See Anderson, at pp. 1000, 1002.)
       The “known or knowable” standard arguably derives from negligence
principles (see Anderson, supra, 53 Cal.3d at pp. 1000-1001), and failure to warn
claims are generally “ „rooted in negligence‟ to a greater extent than”

                                           7
manufacturing or design defect claims. (Id. at p. 1002; see Carlin v. Superior
Court (1996) 13 Cal.4th 1104, 1111-1112.) Unlike those other defects, a
“ „warning defect‟ relates to a failure extraneous to the product itself” and can only
be assessed by examining the manufacturer‟s conduct. (Anderson, at p. 1002.)
These principles notwithstanding, California law recognizes separate failure to
warn claims under both strict liability and negligence theories.6 In general, a
product seller will be strictly liable for failure to warn if a warning was feasible
and the absence of a warning caused the plaintiff‟s injury. (Blackwell v. Phelps
Dodge Corp. (1984) 157 Cal.App.3d 372, 377; see Anderson, at p. 1002.)
Reasonableness of the seller‟s failure to warn is immaterial in the strict liability
context. (Anderson, at pp. 1002-1003.) Conversely, to prevail on a claim for
negligent failure to warn, the plaintiff must prove that the seller‟s conduct fell
below the standard of care. (Id. at p. 1002.) If a prudent seller would have acted
reasonably in not giving a warning, the seller will not have been negligent. (Id. at
p. 1003.)
       Products liability plaintiffs often allege both design and warning defects.
(See Anderson, supra, 53 Cal.3d at p. 995, fn. 7.) Here, the jury found no design
defect. Accordingly, our opinion focuses on failure to warn.7

6       The Restatement Third of Torts observes that doctrinal categories such as
“negligence” and “strict liability” are not precisely relevant to failure to warn
liability, where the overarching inquiry is whether “foreseeable risks of harm
posed by the product could have been reduced or avoided” by warnings and the
absence of a warning renders the product unsafe. (Rest.3d Torts, Products
Liability, § 2, subd. (b); see id., com. n, pp. 35-36.)
7      In addition to rejecting Special Electric‟s arguments on failure to warn, the
Court of Appeal concluded the jury had rendered a “general negligence verdict”
that was not disturbed by the entry of JNOV. Because we agree with the Court of
Appeal that the trial court erred in granting JNOV, we need not address this
alternate ground for reversal.

                                           8
              b.     Relevant Defenses
                     1)      Sophistication of the Product User
       Several defenses have developed to mitigate liability in appropriate
circumstances. For example, under the “obvious danger” rule, “there is no need to
warn of known risks under either a negligence or strict liability theory.” (Johnson,
supra, 43 Cal.4th at p. 67.) This defense is based on a Restatement provision
stating that warnings are unnecessary if a product‟s dangers are readily observable
and the supplier has reason to expect the user will perceive them. (Rest.2d Torts,
§ 388, subd. (b), com. k, pp. 306-307; see Johnson, at p. 66.) “Courts have
interpreted section 388, subdivision (b), to mean that if the manufacturer
reasonably believes the user will know or should know about a given product‟s
risk, the manufacturer need not warn that user of that risk. [Citations.] This is
„especially [true] when the user is a professional who should be aware of the
characteristics of the product.‟ ” (Johnson, at p. 66.)
       The sophisticated user defense is a particular application of the obvious
danger rule. We recognized this defense in Johnson, explaining that
“sophisticated users need not be warned about dangers of which they are already
aware or should be aware.” (Johnson, supra, 43 Cal.4th at p. 65.) Because
sophisticated users already know, or should know, about the product‟s dangers, the
manufacturer‟s failure to warn is not the legal cause of any harm. (Ibid.) A
sophisticated user‟s knowledge is thus the equivalent of prior notice. (Ibid.) The
defense serves public policy, because requiring warnings of obvious or generally
known product dangers could invite consumer disregard and contempt for
warnings in general. (Id. at p. 70.)
       The sophisticated user defense does not require a user‟s actual awareness of
potential hazards. Rather, a product manufacturer or supplier is not liable for
failing to warn a sophisticated user if the user knew or should have known of the
product‟s risk in light of his training or skill. (Johnson supra, 43 Cal.4th at p. 71.)
“The focus of the defense . . . is whether the danger in question was so generally

                                           9
known within the trade or profession that a manufacturer should not have been
expected to provide a warning specific to the group to which plaintiff belonged.”
(Id. at p. 72.) Although other states have adopted different rules, California‟s
sophisticated user defense applies to both strict liability and negligent failure to
warn claims. (Id. at pp. 71-73.)
       The sophisticated user defense has been applied when the end user of a
product can be expected to know about potential risks due to the user‟s extensive
training or professional experience. For example, in Johnson we concluded that
an air conditioning equipment manufacturer was shielded from liability for failing
to warn a highly trained and certified technician about the risks of exposure to a
commonly used refrigerant. (Johnson, supra, 43 Cal.4th at pp. 61-62, 74.)
Somewhat different questions arise when the manufacturer or supplier sells a
product to a sophisticated purchaser, which then passes the product on to other
users. In such cases, the product‟s immediate purchaser has actual or imputed
knowledge of potential risks, but the product‟s ultimate users may not.
                     2)      Component Parts Doctrine
       Another defense protects manufacturers and sellers of component parts
from liability to users of finished products incorporating their components. Under
the component parts doctrine, the supplier of a product component is not liable for
injuries caused by the finished product unless: (1) the component itself was
defective and caused injury or (2) the supplier participated in integrating the
component into a product, the integration caused the product to be defective, and
that defect caused injury. (Rest.3d Torts, Products Liability, § 5; O’Neil v. Crane
Co., supra, 53 Cal.4th at p. 355.) The rationale for this defense is that, while
component part sellers should be responsible for defects in their own product, and
must warn purchasers about risks associated with the use of their product, they
cannot reasonably be expected to monitor the development of all potential
products into which their components are integrated. (Rest.3d Torts, Products
Liability, § 5, coms. a & b, pp. 130-133.) Thus, “when a sophisticated buyer

                                          10
integrates a component into another product, the component seller owes no duty to
warn either the immediate buyer or ultimate consumers of dangers arising because
the component is unsuited for the special purpose to which the buyer puts it.” (Id.,
§ 5, com. b, p. 132.) Like the sophisticated user defense, the component parts
defense applies to both strict liability and negligence claims. (Taylor v. Elliott
Turbomachinery Co. Inc., supra, 171 Cal.App.4th at pp. 584, 595-596.)
                      3)     Bulk Supplier Doctrine
       In addition to manufactured items, raw materials can also be components of
a finished product. The bulk supplier doctrine describes a particular application of
the component parts doctrine for raw materials supplied in bulk and intended for
further processing.
       Origins of the bulk supplier rule can be traced to the Restatement Second of
Torts, which stated a rule of strict liability for the sale of a dangerous product that
“is expected to and does reach the user or consumer without substantial change in
the condition in which it is sold.” (Rest.2d Torts, § 402A, subd. (1)(b).) The
provision included a caveat for products that are “expected to be processed or
otherwise substantially changed” before reaching the end user. (Id., Caveat,
subd. (2), p. 348.) The drafters explained that liability in such cases would likely
depend on “whether the responsibility for discovery and prevention of the
dangerous defect is shifted to the intermediate party” that further processes the
material. (Id., com. p, p. 357.)
       The most recent Restatement of Torts addresses the bulk supplier doctrine
explicitly. Comment c to the Restatement Third of Torts, section 5, describes the
specific application of the component parts doctrine to raw materials. It provides
that a bulk supplier is liable for harm caused by “contaminated or otherwise
defective” raw materials but notes that “a basic raw material such as sand, gravel,
or kerosene cannot be defectively designed.” (Rest.3d Torts, Products Liability,

                                          11
§ 5, com. c, p. 134.)8 Nor are raw material sellers liable for injuries caused by the
defective design of a finished product. (Rest.3d Torts, Products Liability, § 5,
com. c, p. 134.) “Inappropriate decisions regarding the use of such materials are
not attributable to the supplier of the raw materials but rather to the fabricator that
puts them to improper use.” (Ibid.) Finally, comment c observes that failure to
warn liability would be unduly onerous because it would require raw material
suppliers “to develop expertise regarding a multitude of different end-products and
to investigate the actual use of raw materials by manufacturers over whom the
supplier has no control.” (Ibid.)
       Artiglio v. General Electric Co., supra, 61 Cal.App.4th at page 837,
examined the bulk supplier defense in detail. In Artiglio, the plaintiffs sued for
injuries from breast implants. They claimed the implant manufacturer and a
supplier of component silicone compounds were negligent in failing to warn
customers about the health risks of silicone in medical devices. (Id. at pp. 833-
834.) Building on earlier case law and related federal decisions, the court held that
raw material suppliers owe no duty of care to consumers of the finished product
when four conditions are met: (1) the material supplied is not inherently
dangerous; (2) the material is sold in bulk to a sophisticated buyer; (3) the material
is substantially changed during the manufacturing of a finished product; and (4)
the supplier has a limited role in creating the finished product. (Id. at p. 839.)
Applying these factors, the court concluded the silicone supplier had no duty to
warn implant recipients about the health hazards of silicone, even though the
supplier was aware of how its raw material was being used. (Id. at p. 841.) Given

8      Notably, the Third Restatement rejects the consumer expectations test for
proving design defect liability. (See Rest.3d Torts, Products Liability, § 2, com. g,
pp. 27-28.) This position is contrary to California law, which allows a design
defect to be shown by either the consumer expectations or the risk utility test.
(See ante, at p. 7; Barker, supra, 20 Cal.3d at p. 432.) The present case concerns
only failure to warn, and we express no view on design defect liability.

                                          12
the supplier‟s limited role in the manufacturing process, “the social cost of
fulfilling such a duty would far exceed the utility of imposing the duty.” (Ibid.)
       The bulk supplier defense described in Artiglio applies only to raw
materials that are not inherently dangerous. (Artiglio v. General Electric Co.,
supra, 61 Cal.App.4th at p. 839.) This limitation parallels the component part
doctrine‟s requirement that the component itself not be defective. (See O’Neil v.
Crane Co., supra, 53 Cal.4th at p. 355; Rest.3d Torts, Products Liability, § 5,
subd. (a).) Even if a raw material is not manufactured or designed, any dangerous
product is “defective” if it is not accompanied by adequate warnings about the
risk. (Rest.3d Torts, Products Liability, § 2, subd. (c); Brown, supra, 44 Cal.3d at
p. 1057.)
       2.     The Sophisticated Intermediary Doctrine
       In general, a manufacturer or distributor has a duty to warn about all known
or knowable risks of harm from the use of its product. (Anderson, supra, 53
Cal.3d at p. 1000; Rest.3d Torts, Products Liability, § 2, subd. (c).) This duty
applies to all entities in a product‟s supply chain. (See Taylor v. Elliott
Turbomachinery Co. Inc., supra, 171 Cal.App.4th at p. 575.) Thus, a supplier that
places a hazardous raw material in the stream of commerce has a duty to warn
about the material‟s inherent risks. The supplier clearly has a duty to warn the
material‟s immediate purchaser unless the purchaser is a sophisticated user and
presumably already aware of the relevant risks. (See Johnson, supra, 43 Cal.4th at
p. 65.) The supplier‟s duty also logically extends to others who encounter the
hazardous raw material, for example, after it has been incorporated into a finished
product.9 However, circumstances may make it extremely difficult, or impossible,

9     In addition to users of finished products incorporating the raw material,
employees of the purchaser may also encounter the raw material in their work.
The question there is whether the supplier‟s duty to warn extends to its customers‟
employees. (See Schwoerer v. Union Oil Co. (1993) 14 Cal.App.4th 103, 110-
111.) Different considerations may apply in the employer-employee context, and
we express no view on how principles discussed in this opinion may apply there.

                                          13
for a raw material supplier to provide warnings directly to the consumers of
finished products.
       The sophisticated intermediary doctrine defines the scope of the supplier‟s
duty in this context. The doctrine originated in the Restatement Second of Torts,
section 388, comment n, pages 307 to 310, which addresses when warnings to a
party in the supply chain are sufficient to satisfy the supplier‟s duty to warn. The
comment observes that warnings to a direct purchaser may not always be
sufficient, and the ultimate question is whether the supplier has exercised
reasonable care to ensure “that the information will reach those whose safety
depends on their having it.” (Id. at p. 308.) Whether it is reasonable for the
supplier to rely on the purchaser to transmit warnings depends on several
considerations, such as the reputation of the purchaser and, perhaps, the purpose
for which the product is supplied. (Id. at pp. 308-309.) The comment did not
attempt to describe all relevant factors but noted generally that “the magnitude of
the risk involved,” meaning both the seriousness of the potential harm and its
likelihood of occurring, must be balanced against the burden that would be
imposed by requiring direct warnings. (Id. at p. 309.)
       Persons v. Salomon North America, Inc. (1990) 217 Cal.App.3d 168
illustrates how section 388, comment n has been applied in California. There, a
manufacturer of ski bindings was sued after the bindings failed to release properly
during a skier‟s fall. (Persons, at pp. 171-172.) The binding maker was aware
that its bindings were incompatible with untreated thermoplastic ski boots. It had
warned the ski rental facility about the problem and instructed the facility how to
recognize and treat incompatible boots. It did not warn individual skiers,
however. (Id. at pp. 171-173.) Relying on section 388, comment n, the Court of
Appeal concluded the binding manufacturer had discharged its duty to warn by
alerting the rental shop to the danger and reasonably relying on the shop to warn
end users and take steps to avoid the harm. (Persons, at pp. 171-172.) This
conclusion rested heavily on evidence showing it was not feasible for the

                                         14
manufacturer to provide effective warnings directly to end users. (Id. at p. 176.)
The court invoked section 388, comment n, observing that when there is “no
effective way to convey a product warning to the ultimate consumer, the
manufacturer should be permitted to rely on downstream suppliers to provide the
warning.” (Persons, at p. 178.) Moreover, the binding manufacturer‟s reliance
was reasonable because the rental shop “had an independent duty to exercise
reasonable care in supplying this equipment and was itself subject to strict liability
for failure to warn its customers of the dangerous propensities of articles it
rented.” (Ibid.)
       The Restatement drafters‟ most recent articulation of the sophisticated
intermediary doctrine appears in the Restatement Third of Torts, Products
Liability, section 2, comment i, at page 30. The drafters intended this comment to
be substantively the same as section 388, comment n, of the Restatement Second
of Torts. (See Rest.3d Torts, Products Liability, § 2, com. i, reporter‟s note 5,
p. 96; Humble Sand & Gravel Inc. v. Gomez, supra, 146 S.W.3d at p. 190.)
Section 2, comment i explains: “There is no general rule as to whether one
supplying a product for the use of others through an intermediary has a duty to
warn the ultimate product user directly or may rely on the intermediary to relay
warnings. The standard is one of reasonableness in the circumstances. Among the
factors to be considered are the gravity of the risks posed by the product, the
likelihood that the intermediary will convey the information to the ultimate user,
and the feasibility and effectiveness of giving a warning directly to the user.”
(Rest.3d Torts, Products Liability, § 2, com. i, p. 30.)
       We have not previously addressed how the sophisticated intermediary
doctrine applies in California.10 We now formally adopt the sophisticated

10     We have, however, adopted the learned intermediary doctrine, a related
rule that applies when drugs or medical devices are supplied in the context of the
doctor-patient relationship. (Carlin v. Superior Court, supra, 13 Cal.4th at
p. 1116; Stevens v. Parke, Davis & Co. (1973) 9 Cal.3d 51, 64-65 [applying
                                          15
intermediary doctrine as it has been expressed in the Restatement provisions just
discussed. Under this rule, a supplier may discharge its duty to warn end users
about known or knowable risks in the use of its product if it: (1) provides
adequate warnings to the product‟s immediate purchaser, or sells to a sophisticated
purchaser that it knows is aware or should be aware of the specific danger, and (2)
reasonably relies on the purchaser to convey appropriate warnings to downstream
users who will encounter the product. Because the sophisticated intermediary
doctrine is an affirmative defense, the supplier bears the burden of proving that it
adequately warned the intermediary, or knew the intermediary was aware or
should have been aware of the specific hazard, and reasonably relied on the
intermediary to transmit warnings. (See Swope v. Columbian Chemicals Co. (5th
Cir. 2002) 281 F.3d 185, 206; cf. Johnson, supra, 43 Cal.4th at p. 65.)
         Like the sophisticated user defense, the sophisticated intermediary defense
applies to failure to warn claims sounding in either strict liability or negligence.
(See Johnson, supra, 43 Cal.4th at p. 71.) As we have previously observed, “there
is little functional difference between the two theories in the failure to warn
context.” (Ibid.) “[I]n failure to warn cases, whether asserted on negligence or
strict liability grounds, there is but one unitary theory of liability which is
negligence based—the duty to use reasonable care in promulgating a warning.”
(Higgins v. E.I. DuPont de Nemours & Co., Inc. (D.Md. 1987) 671 F.Supp. 1055,
1060.)
         The goal of products liability law is not merely to spread risk but also “to
„induce conduct that is capable of being performed.‟ ” (Hoffman v. Houghton
Chemical Corp., supra, 751 N.E.2d at p. 857.) The sophisticated intermediary
doctrine serves this goal by recognizing a product supplier‟s duty to warn but

Rest.2d Torts, § 388].) Although we acknowledged in Macias v. State of
California (1995) 10 Cal.4th 844, 853 that the sophisticated intermediary defense
is well established in product liability law, that case was resolved on a different
ground.

                                           16
permitting the supplier to discharge this duty in a responsible and practical way. It
appropriately and equitably balances the practical realities of supplying products
with the need for consumer safety. (See ibid.)
              a.     Actual Warnings or Sophistication of Intermediary
       Under the sophisticated intermediary doctrine‟s first prong, generally the
supplier must have provided adequate warnings to the intermediary about the
particular hazard. (See, e.g., Humble Sand & Gravel Inc. v. Gomez, supra, 146
S.W.3d at pp. 176-177; Hoffman v. Houghton Chemical Corp., supra, 751 N.E.2d
at p. 852.) In some cases the buyer‟s sophistication can be a substitute for actual
warnings, but this limited exception only applies if the buyer was so
knowledgeable about the material supplied that it knew or should have known
about the particular danger. (See, e.g., Cimino v. Raymark Industries, Inc. (5th
Cir. 1998) 151 F.3d 297, 334 [raw asbestos supplier did not need to warn
Fibreboard, “a sophisticated, expert, and knowledgeable manufacturer” of
insulation products, about asbestos risks]; Higgins v. E.I. DuPont de Nemours &
Co., Inc., supra, 671 F.Supp. at pp. 1061-1062 [highly sophisticated manufacturer
acquired knowledge from independent inquiry and outside sources, including its
suppliers].) This narrow exception to the duty to warn is consistent with our
recognition in Johnson, supra, 43 Cal.4th at page 65, that knowledge of a
product‟s risks is the equivalent of prior notice. If a purchaser is so
knowledgeable about a product that it should already be aware of the product‟s
particular dangers, the seller is not required to give actual warnings telling the
buyer what it already knows. (See ibid.)
       A raw asbestos supplier asserted the sophisticated intermediary defense in
Stewart v. Union Carbide Corp., supra, 190 Cal.App.4th 23. The Court of Appeal
rejected the defense without further analysis, however, because it concluded “that
doctrine, where it applies at all, applies only if a manufacturer provided adequate
warnings to the intermediary.” (Id. at p. 29.) This assertion cannot be reconciled
with our analysis in Johnson. Sophistication obviates the need for warnings

                                          17
because a sophisticated purchaser already knows or reasonably should know of the
relevant risks. (See Johnson, supra, 43 Cal.4th at p. 65.) Although in most cases
a warning to the intermediary will be necessary, warnings are not required if the
intermediary was so sophisticated that it actually knew or reasonably should have
known about the potential harm. (Cf. Cabasug v. Crane Co., supra, 988
F.Supp.2d at p. 1228 [sophisticated intermediary defense would be available to
asbestos product manufacturer that provided no warnings if it could establish that
its buyer, the Navy, was already aware of asbestos risks].) Insofar as it expresses a
different view, Stewart v. Union Carbide Corp., supra, 190 Cal.App.4th 23, is
disapproved.
       Contrary to Special Electric‟s assertion, however, the sophistication of a
product‟s purchaser, standing alone, may not be sufficient to discharge the
supplier‟s duty to warn. As the Second Restatement explains, providing thorough
warnings to the immediate purchaser “is not in all cases sufficient to relieve the
supplier from liability. . . . The question remains whether this method gives a
reasonable assurance that the information will reach those whose safety depends
on their having it.” (Rest.2d Torts, § 388, com. n, p. 308; see Vondra v. Chevron
U.S.A., Inc. (D.Neb. 2009) 652 F.Supp.2d 999, 1007 [“proof that an intermediary
knows the product is dangerous will not always absolve the supplier of a duty to
warn ultimate consumers”].) In addition to warnings or sophistication of the
purchaser, it must have been reasonable for the supplier to rely on the purchaser to
warn others who would foreseeably encounter the hazardous product.
       Early California cases in this area focused not on reasonable reliance, but
on whether suppliers had the ability to warn end users directly. For example,
Walker v. Stauffer Chemical Corp. (1971) 19 Cal.App.3d 669, 671, concerned
injuries from a drain cleaner containing sulfuric acid. The court held it
unreasonable to impose liability on the sulfuric acid supplier because the supplier
had no control over compounding, packaging, or marketing the cleaning product.
(Id. at p. 674.) Similarly, in Groll v. Shell Oil Co. (1983) 148 Cal.App.3d 444,

                                         18
449, the supplier of a chemical repackaged as lighter fluid was not liable for
failing to warn the lighter fluid‟s users because it had no means of communicating
warnings to them. The court observed that a contrary holding would have
imposed “an onerous burden” on raw material suppliers to monitor the packaging
of finished products distributed by other companies. (Ibid.)
       However, in a recent case involving asbestos products sold to the Navy, the
Court of Appeal observed, “to avoid liability, there must be some basis for the
supplier to believe that the ultimate user knows, or should know, of the item‟s
hazards.” (Pfeifer v. John Crane, Inc., supra, 220 Cal.App.4th at p. 1296, italics
added). Drawing upon the principles in Johnson, supra, 43 Cal.4th at page 71 and
the Restatement Second of Torts, section 388, the court concluded, “the
intermediary‟s sophistication is not, as [a] matter of law, sufficient to avert
liability; there must be a sufficient reason for believing that the intermediary‟s
sophistication is likely to operate to protect the user, or that the user is likely to
discover the hazards in some other manner.” (Pfeifer, at pp. 1296-1297.)
               b.     Actual and Reasonable Reliance on Intermediary
       To establish a defense under the sophisticated intermediary doctrine, a
product supplier must show not only that it warned or sold to a knowledgeable
intermediary, but also that it actually and reasonably relied on the intermediary to
convey warnings to end users. This inquiry will typically raise questions of fact
for the jury to resolve unless critical facts establishing reasonableness are
undisputed. (See Adkins v. GAF Corp. (6th Cir. 1991) 923 F.2d 1225, 1230;
Hoffman v. Houghton Chemical Corp., supra, 751 N.E.2d at p. 856.)11

11     In Anderson, supra, 53 Cal.3d at pages 1002 to 1003, we observed that the
reasonableness of a supplier‟s failure to warn is immaterial in the strict liability
context. However, Anderson was addressing the reasonableness of a failure to
give any warnings at all, whereas the question here is whether a supplier has
discharged its duty to warn by providing appropriate warnings to an intermediary
and reasonably relying on the intermediary to pass on warnings to end users. A
reasonableness inquiry is not inconsistent with strict liability in this context.

                                           19
       Several factors are relevant in deciding whether it is reasonable for a
supplier to rely on an intermediary to provide a warning. The most recent
Restatement provision distills these factors into three distinct categories: “the
gravity of the risks posed by the product, the likelihood that the intermediary will
convey the information to the ultimate user, and the feasibility and effectiveness of
giving a warning directly to the user.” (Rest.3d Torts, Products Liability, § 2,
com. i, p. 30.)
       The “gravity” of risk factor encompasses both the “serious or trivial
character of the harm” that is possible and the likelihood that this harm will result.
(Rest.2d Torts, § 388, com. n, p. 309.) This factor focuses on the nature of the
material supplied. If the substance is extremely dangerous, the supplier may need
to take additional steps, such as inquiring about the intermediary‟s warning
practices, to ensure that warnings are communicated. (See ibid.) The overarching
question is the reasonableness of the supplier‟s conduct given the potential
severity of the harm.
       The second Restatement factor, measuring the likelihood that the
intermediary will warn, focuses on the reliability of the intermediary. The
supplier‟s knowledge about the intermediary‟s reliability is judged by an objective
standard, based on what a reasonable supplier would have known under the
circumstances. (See Rest.2d Torts, § 388, com. n, p. 308 [“known or knowable
character” of the intermediary is relevant to reasonableness of relying on
intermediary to warn].) Relevant concerns for this factor include, for example, the
intermediary‟s level of knowledge about the hazard, its reputation for carefulness
or consideration, and its willingness, and ability, to communicate adequate
warnings to end users. (See id., coms. l & n, pp. 307-308.) Of course, a supplier
is always free to inquire about the intermediary‟s warning policies and practices as
a means of assessing the intermediary‟s reliability. The Second Restatement
suggests economic motivations may also be important. For example, an
intermediary manufacturer may have an incentive to withhold necessary

                                          20
information about a component material if warnings would make its product less
attractive. (See id., com. n, pp. 309-310; Aubin v. Union Carbide Corp., supra,
177 So.3d at p. 515.)
       It is also significant if, under the circumstances giving rise to the plaintiff‟s
claim, the intermediary itself had a legal duty to warn end users about the
particular hazard in question. (See Persons v. Salomon North America, Inc.,
supra, 217 Cal.App.3d at p. 178.) In general, “ „every person has a right to
presume that every other person will perform his duty and obey the law.‟ ”
(Harris v. Johnson (1916) 174 Cal. 55, 58.) As the Restatement notes, “[m]odern
life would be intolerable unless one were permitted to rely to a certain extent on
others‟ doing what they normally do, particularly if it is their duty to do so.”
(Rest.2d Torts, § 388, com. n, p. 308.) This consideration may be especially
relevant in the context of a raw material or other component supplied for use in
making a finished product. Under California law, a product manufacturer has a
legal duty to warn its customers of all known or knowable dangers arising from
use of the product. (Anderson, supra, 53 Cal.3d at pp. 1000, 1002; Carlin v.
Superior Court, supra, 13 Cal.4th at p. 1113, fn. 3 [manufacturer is charged with
knowledge of an expert].) However, regardless of the purchaser‟s independent
duty, the supplier cannot reasonably ignore known facts that would provide notice
of a substantial risk that the intermediary might fail to warn or that warnings might
fail to reach the consumer. (Cf. Hoffman v. Houghton Chemical Corp., supra, 751
N.E.2d at p. 858 [approving jury instruction asking whether supplier had reason to
anticipate “ „negligence or other fault‟ ” by intermediary in failing to warn end
users].)
       The third factor for assessing the reasonableness of relying on an
intermediary explores whether it was feasible for the supplier to convey effective
warnings directly to end users. (Rest.3d Torts, Products Liability, § 2, com. i,
p. 30.) Whereas the first two factors focus on the product and the intermediary,
this factor focuses on what the supplier can realistically accomplish.

                                          21
       When raw materials are supplied in bulk for the manufacture of a finished
product, it may be difficult for the supplier to convey warnings to the product‟s
ultimate consumers. These suppliers likely have no way to identify ultimate
product users and no ready means to communicate with them. “Bulk products
often are delivered in tank trucks, box cars, or large industrial drums, and stored in
bulk by the intermediary, who generally repackages or reformulates the bulk
product. Even if the product could be labeled by the supplier, any label warnings
provided to the intermediary would be unlikely to reach the end user.” (Hoffman
v. Houghton Chemical Corp., supra, 751 N.E.2d at p. 856.) A raw material
supplier‟s ability to warn end users may thus differ significantly from that of a
product manufacturer or distributor that sells packaged commodities or deals
directly with consumers. “If the goods are packaged it is entirely feasible for the
manufacturer to include an appropriate warning on the package.” (Jones v. Hittle
Service, Inc. (Kan. 1976) 549 P.2d 1383, 1393.) In addition to cautionary labels or
packaging inserts, manufacturers may sometimes be able to affix a warning to the
product itself. In contrast, a raw material supplier can often do little more than
furnish the manufacturer with appropriate warnings and rely on the manufacturer
to pass them along. (See id. at p. 1394; see also Ausness, Learned Intermediaries
and Sophisticated Users: Encouraging the Use of Intermediaries to Transmit
Product Safety Information (1996) 46 Syracuse L.Rev. 1185, 1232 [finished
product manufacturer is typically in the best position to effectively warn
consumers of the hazard].) Although this factor is not dispositive, the infeasibility
of direct warnings in the bulk supplier context may weigh in favor of finding it
was reasonable for the supplier to rely on an intermediary to warn.
       3.     Application in this Case
       Having discussed the evolution of related doctrines, we turn to the
application of the sophisticated intermediary rule in the context presented here.
       After the jury found Special Electric liable for failure to warn, the trial
court overturned this verdict by entering JNOV. “ „A motion for judgment

                                          22
notwithstanding the verdict may be granted only if it appears from the evidence,
viewed in the light most favorable to the party securing the verdict, that there is no
substantial evidence in support. [Citation.] [¶] . . . As in the trial court, the
standard of review [on appeal] is whether any substantial evidence—contradicted
or uncontradicted—supports the jury‟s conclusion.‟ ” (Cabral v. Ralphs Grocery
Co. (2011) 51 Cal.4th 764, 770.) Viewing the evidence in the light most favorable
to plaintiffs, disregarding conflicting evidence, and drawing all legitimate
inferences in their favor, we conclude the entry of JNOV cannot stand.
       Special Electric arguably forfeited the sophisticated intermediary defense
by failing to present it to the jury. Although Special Electric argued in the nonsuit
and directed verdict motions that it had no duty to warn a sophisticated purchaser
like Johns-Manville about asbestos, it never attempted to show that it actually or
reasonably relied on Johns-Manville to warn end users. Nor did Special Electric
request a jury instruction or verdict form question on the sophisticated
intermediary doctrine.
       Assuming the defense was preserved, the record does not establish as a
matter of law that Special Electric discharged its duty to warn by reasonably
relying on a sophisticated intermediary. The evidence is disputed about whether
Special Electric consistently provided warnings to Johns-Manville during the
relevant time frame. Special Electric contends warnings were not necessary in any
event because Johns-Manville was highly sophisticated and knowledgeable about
the health risks of asbestos. Although the record clearly shows Johns-Manville
was aware of the risks of asbestos in general, no evidence established it knew
about the particularly acute risks posed by the crocidolite asbestos Special Electric
supplied. In addition, plaintiffs presented evidence that at least one Special
Electric salesperson told customers crocidolite was safer than other types of
asbestos fiber, when the opposite was true. If the jury credited this evidence, it
may have found it unreasonable for Special Electric to believe Johns-Manville was

                                           23
so sophisticated that a warning about the particular dangers of crocidolite asbestos
was not called for.
       Moreover, the record does not establish as a matter of law that Special
Electric actually and reasonably relied on Johns-Manville to warn end users like
William Webb about the dangers of asbestos. We recognize that direct proof of
actual reliance may be difficult to obtain when, as in the case of latent disease, the
material was supplied to an intermediary long ago. However, actual reliance is an
inference the factfinder should be able to draw from circumstantial evidence about
the parties‟ dealings. The trial record here is devoid of evidence supporting such
an inference. In addition, the jury could have reasonably determined that any
reliance on Johns-Manville would have been unjustified. Plaintiffs presented
testimony from a former Johns-Manville employee criticizing the company‟s
handling of asbestos warnings and asserting it had failed to warn its own workers
about the hazards of asbestos before the mid-1970s.
       Accordingly, because substantial evidence supports the jury‟s verdict
against Special Electric, the trial court erred in granting JNOV.12

12     Special Electric contends the evidence was insufficient to show Webb was
exposed to crocidolite asbestos it had supplied. The Court of Appeal rejected this
argument, finding substantial evidence of exposure and causation. We too
conclude this alternative ground for affirming the JNOV order lacks merit.
Plaintiffs introduced evidence that Webb was exposed to dust from Johns-
Manville products containing trace amounts of crocidolite at roughly the same
time Special Electric was supplying crocidolite asbestos to Johns-Manville. While
evidence of the link could be stronger, it is nonetheless sufficient for the jury to
have found that Special Electric‟s asbestos was a substantial factor in causing
Webb‟s mesothelioma. (See Rutherford v. Owens-Illinois, Inc. (1997) 16 Cal.4th
953, 976-977; Sparks v. Owens-Illinois, Inc. (1995) 32 Cal.App.4th 461, 476.)

                                          24
                             III. DISPOSITION
     The judgment of the Court of Appeal is affirmed.

                                             CORRIGAN, J.
WE CONCUR:

WERDEGAR, J.
LIU, J.
CUÉLLAR, J.
KRUGER, J.

                                     25
              CONCURRING AND DISSENTING OPINION BY
                     CANTIL-SAKAUYE, C. J.

       I agree that substantial evidence supports the jury‟s verdict against Special
Electric Company, Inc. (Special Electric), and that the judgment of the Court of
Appeal should therefore be affirmed. I disagree, however, with the majority‟s
holding that a supplier of hazardous materials may satisfy its duty to warn end
users by relying on an intermediary where the supplier fails to warn the
intermediary of the dangers and knows only that the intermediary “should be”
rather than “is actually” aware of the dangers.
       As discussed below, the record reflects that health hazards of asbestos have
long been known, but research concerning the relationship between crocidolite and
mesothelioma did not begin to emerge until the 1960s. Thereafter, studies
established that crocidolite is by far the most dangerous form of asbestos, and was
the cause of a grossly disproportionate number of mesothelioma cases. Special
Electric, which sold crocidolite to Johns-Manville Corporation (Johns-Manville),
did not warn Johns-Manville or any end users of Johns-Manville‟s products of the
dangers associated with crocidolite. The victims of mesothelioma are a graphic
illustration of the tragedy that may follow the failure to warn of a product‟s
hazards. Because a requirement that a supplier convey warnings to a direct
purchaser imposes only a minimal burden, no policy reason exists to allow
suppliers to rely on intermediaries even if the suppliers do not know the

                                          1
intermediaries actually know of the dangers. Neither the cases nor the principles
the majority cites support its holding.
       According to expert testimony in this case, there were reports in the 1920s
linking the breathing of asbestos dust to death. By the end of the 1930s, it was
established that asbestos caused asbestosis, or scarring of the lungs, and it was
clear in the 1950s that exposure to asbestos caused lung cancer.
       In early studies, mesothelioma, a relatively rare cancer, was not
distinguished from other lung cancers caused by asbestos, but in 1960, a study was
published concerning the incidence of mesothelioma in South Africa, where
crocidolite was mined. It was not until the mid-1960s that researchers began
studying whether different types of asbestos carry different risks. According to an
expert in this case, subsequent studies reflected that crocidolite caused almost all
cases of mesothelioma. One expert opined that crocidolite presents five times the
risk of chrysotile asbestos, the type of asbestos mined by Johns-Manville in
Quebec, and conceded crocidolite might present a risk as high as 10 times the
toxicity of chrysotile. A second expert opined that crocidolite is 500 times as
toxic, and testified that others estimated its risk to be 800 times as high. A third
expert testified that one day‟s exposure to a significant concentration of crocidolite
could cause mesothelioma. The risk is borne not only by the individual who
encounters crocidolite in the workplace, but also by those who come in contact
with the individual‟s work clothes; family members unknowingly exposed
themselves to this extremely toxic substance by hugging a loved one and
laundering work clothes.
       As one expert observed, mesothelioma is “a bad way to die.” The expert
explained that the malignancy involves the lining of the lung, and will eventually
entrap the entire lung, creating the tightening effect of a corset by preventing the
lung from expanding. The cancer also grows outward into the chest wall where it

                                          2
irritates nerve roots, creating pain. People with mesothelioma live, on average,
12 to 14 months. Chemotherapy may extend their lives a few months, but will not
cure the cancer. If a patient survives surgery to remove as much of the lung lining
as possible or to remove an entire lung, his or her life expectancy will be about 24
months. Eventually, patients require oxygen 24 hours a day and increasing doses
of narcotics to mitigate the pain. In addition, as the cancer consumes muscle
mass, patients become increasingly weak, losing the ability to care for themselves
and finally requiring care 24 hours a day.
       One of the purposes of providing warnings concerning the dangers of
products is to enable the consumer or others who might come in contact with the
product to choose not to expose themselves to the risks presented. (Rest.3d Torts,
Products Liability, § 2, com. i, p. 30.) According to the Centers for Disease
Control, during just the seven-year period from 1999 to 2005, mesothelioma was
associated with more than 18,000 deaths in the United States. (Centers for
Disease Control, Malignant Mesothelioma Mortality — United States, 1999-2005,
MMWR Weekly (Apr. 24, 2009) online at
http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5815a3.htm, as of May 23,
2016.) Presumably, had those victims been warned of the toxicity of crocidolite,
most would have chosen not to be exposed to this carcinogen. Due to the failure
of participants in the stream of commerce, consumers and others were not able to
make a choice to protect themselves and their loved ones from this extremely toxic
substance.
       In this case, we are called upon to determine how a supplier of a hazardous
material may satisfy its duty to warn those who might be exposed to the hazard,
and thereby enable those at risk to take steps to mitigate or entirely avoid the risk.
As the majority acknowledges, every seller in the chain of distribution has a duty
to warn of known hazards, and in some cases may satisfy that duty by relying on

                                           3
others to provide adequate warnings. (Maj. opn., ante, at pp. 1-2, 7, 13.) I agree
with the majority that the Restatement sets forth the appropriate test for evaluating
whether a supplier may rely on an intermediary to warn those who will
subsequently encounter the hazard — “reasonableness in the circumstances.”
(Rest.3d Torts, Products Liability, § 2, com. i, p. 30; maj. opn., ante, at p. 15.)
I disagree, however, with the majority‟s view that a supplier may satisfy its duty to
warn end users by relying on an intermediary where the supplier knew only that
the intermediary should have been aware of the specific danger. (Maj. opn., ante,
at p. 16.)
       In support of this standard, the majority relies principally on Johnson v.
American Standard, Inc. (2008) 43 Cal.4th 56 (Johnson), in which this court
recognized the sophisticated user doctrine.1 Johnson involved a heating,
ventilation, and air conditioning (HVAC) technician‟s claim against a
manufacturer of air conditioning equipment. The technician suffered injuries
when he applied heat to air conditioner pipes, causing residual refrigerant in the
pipes to release a harmful gas. HVAC technicians had generally known of this
risk for decades, and material safety data sheets, which state regulations require
employers to use to train their employees, noted the risk. In addition, the plaintiff

1       The majority also cites two cases in which federal courts attempted to
discern what standard other states would adopt. Neither case actually involved a
failure to warn. (See Cimino v. Raymark Industries, Inc. (5th Cir. 1998) 151 F.3d
297, 334 [trial court made no finding that the supplier failed to warn the
intermediary]; Higgins v. E.I. DuPont de Nemours & Co., Inc. (D. Md. 1987) 671
F.Supp. at pp. 1061-1062 [supplier warned the intermediary].) It also cites a case
that requires actual knowledge of the purchaser‟s knowledge of the risks.
(Cabasug v. Crane Co. (D.Hawaii 2013) 988 F.Supp.2d 1216, 1228 [“Defendants
cannot take benefit of the sophisticated purchaser defense unless they can establish
that they knew that the Navy was aware of the dangers of asbestos and that
Defendants reasonably concluded that the Navy would provide warnings to its
employees”].)

                                           4
had the highest certification available from the Environmental Protection Agency,
which allowed him to work on large commercial air conditioning systems.
       Johnson held that “[t]he duty to warn is measured by what is generally
known or should have been known to the class of sophisticated users, rather than
by the individual plaintiff‟s subjective knowledge.” (Johnson, supra, 43 Cal.4th at
pp. 65-66, italics added.) In the course of explaining why the “should have
known” standard applies, Johnson stated that “[i]t would be nearly impossible for
a manufacturer to predict or determine whether a given user or member of the
sophisticated group actually has knowledge of the dangers because of the infinite
number of user idiosyncrasies. For example, given users may have misread their
training manuals, failed to study the information in those manuals, or simply
forgotten what they were taught. However, individuals who represent that they
are trained or are members of a sophisticated group of users are saying to the
world that they possess the level of knowledge and skill associated with that class.
If they do not actually possess that knowledge and skill, that fact should not give
rise to liability on the part of the manufacturer.” (Id. at p. 71, italics added.)
       In the course of explaining that the sophisticated user defense applies to
both negligence and strict liability claims, Johnson stated that the focus of the
defense “is whether the danger in question was so generally known within the
trade or profession that a manufacturer should not have been expected to provide a
warning specific to the group to which plaintiff belonged.” (Johnson, supra,
43 Cal.4th at p. 72.) Similarly, in the course of discussing how to determine user
sophistication, Johnson agreed that “the Court of Appeal „correctly understood the
defense to eliminate any duty to warn when the expected user population is
generally aware of the risk at issue, and correctly rejected the argument that a
manufacturer‟s duty to warn should turn on the individual plaintiff‟s actual
understanding of the risk. Legal duties must be based on objective general

                                            5
predictions of the anticipated user population‟s knowledge, not case-by-case
hindsight examinations of the particular plaintiff‟s subjective state of mind.‟ . . .
The timeline focuses on the general population of sophisticated users and
conforms to the defense‟s purpose to eliminate any duty to warn when the
expected user population is generally aware of the risk at issue.” (Id. at pp. 73-
74.)
       Thus, Johnson‟s sophisticated user defense applies to members of a class of
individuals who should all be aware of the dangers associated with the defendant‟s
product, such as all trained and certified technicians. The defense does not apply
merely because the defendant had knowledge from which it could infer that the
particular purchaser should be aware of the specific danger. Moreover, part of the
rationale for the defense is that it would be nearly impossible for the defendant to
determine whether a particular member of the sophisticated user group has failed
to understand or has forgotten the information he or she, by virtue of training and
certification, should know regarding the dangers. In contrast, in the context of a
sale to an intermediary, directly providing information to the purchaser should
require no more than including warnings with the offer of sale, the sales contract,
or on the packaging; the supplier need not attempt to determine whether a member
of a sophisticated class with which it has no direct contact lacks the knowledge
expected of members of the class. In sum, Johnson‟s reasoning does not support
the majority‟s standard.
       The majority also relies on the principle that the law should encourage
conduct that is capable of being performed, and asserts that the sophisticated
intermediary doctrine serves this end by permitting a supplier to discharge the duty
to warn “in a responsible and practical way.” (Maj. opn., ante, at p. 17.) It
ignores the fact that the most responsible and practical way to satisfy the first
prong of the sophisticated intermediary defense is for a supplier to warn the

                                           6
intermediary of the dangers. Instead, despite the fact that a supplier of dangerous
materials has a duty to warn the purchaser, the majority crafts a rule that enables a
supplier to avoid both that duty and the duty to warn end users by allowing the
supplier to assume its buyer is aware of the risks, based on facts that reflect only
that the buyer should be aware of the risks.
       There does not appear to be any policy reason to allow a supplier merely to
assume a buyer is aware of the risks associated with a product. The appropriate
balancing of interests focuses on encouraging safety while avoiding unreasonable
burdens on commerce. (See Rest.3d Torts, Products Liability, § 2, com. a, p. 16
[in connection with design and warning defects, “[t]he emphasis is on creating
incentives for manufacturers to achieve optimal levels of safety in designing and
marketing products”].) Our analysis should consider whether the burden of
requiring the supplier to either warn the intermediary or know the intermediary is
aware of the risks outweighs the enhancement to safety that may result from such
a requirement. Instead, the majority seems to focus on the balancing of competing
interests in the context of litigation, stating at the outset of its opinion that the
sophisticated intermediary doctrine “balances the competing policies of
compensating those injured by dangerous products and encouraging conduct that
can feasibly be performed.” (Maj. opn., ante, at p. 2.)
       After creating a standard that enables a supplier to shirk its duty to warn of
risks associated with its product, the majority emphasizes the duty to warn in its
discussion of reasonable reliance on the intermediary. It seems inconsistent,
however, to allow a supplier, instead of providing a warning, to assume a buyer is
aware of dangers simply if the supplier knows the buyer should be aware, and
then to characterize as “significant” to the reasonableness of the supplier‟s reliance
the fact that everyone has a duty to provide warnings. Under the majority‟s
approach, if the buyer knows that the next party in the chain of distribution should

                                            7
be aware of the dangers, the buyer may assume that next party knows of the
dangers and forgo giving warnings, and so on down the chain. On the contrary, if
a supplier does not actually warn its buyer, or at least actually know that the buyer
is actually aware of the dangers, it should not be allowed to rely on the duty to
warn in establishing reasonable reliance.
       In connection with the third factor for assessing reasonable reliance — the
feasibility of warning end users — the majority speculates that suppliers of raw
materials “likely have no way to identify ultimate product users and no ready
means to communicate with them.” (Maj. opn., ante, at p. 22.) It is the
defendant‟s burden to establish reasonable reliance, including any difficulties in
providing warnings to end users, and there is no basis for the court‟s factual
conclusions on this issue. The most recent case cited in support of this discussion
is 15 years old. Advances in information technology over the past two decades
may enable suppliers of raw materials to learn the uses to which their products are
put and the populations that may be exposed to the hazards associated with the
products, and to disseminate warnings to those at risk. We should not suggest to
suppliers or the lower courts that the most that can be expected of suppliers of raw
materials is that they try to have warnings printed on a product‟s label.
       Clearly, this case involves grave risks and human suffering far beyond the
typical case involving a failure to warn. It illustrates, however, the tragedy that
may result from the failure of commercial interests to disseminate information
regarding the risks associated with their products. Here, Special Electric peddled
crocidolite, the most toxic form of asbestos, without providing warnings to
anyone. Its reliance on the fact that Johns-Manville itself mined asbestos and
conducted extensive research regarding asbestos demonstrates the superficial
bases on which businesses may infer that their buyers should be aware of the
special dangers posed by the products. Johns-Manville did operate a chrysotile

                                            8
asbestos mine in Quebec, but according to a trial expert, the rate of mesothelioma
among miners and millers of asbestos in Quebec is “very low,” with only about
0.4 percent of all deaths due to mesothelioma. The expert explained that
“[c]hrysotile asbestos is cleared rapidly from the lungs and also dissolves in the
acid environment of the body.” In contrast, crocidolite contains iron, and
therefore does not break down in the body. Crocidolite is available only from
Australia or South Africa; Johns-Manville did not mine crocidolite. In addition,
although Johns-Manville engaged in research regarding asbestos, the research
discussed at trial by a former Johns-Manville employee related to product
development.
       By allowing suppliers of dangerous materials to rely on general
assumptions related to an intermediary‟s awareness of dangers to avoid their duty
to warn, the majority increases the risk that end users will not receive warnings
regarding dangers associated with products they encounter. Because the burden of
providing warnings to a direct purchaser is so minimal, the majority‟s rule is not
justified. Therefore, I dissent from the majority‟s holding concerning the first
prong of the sophisticated intermediary defense.

                                                        CANTIL-SAKAUYE. C. J.

I CONCUR:
CHIN, J.

                                          9
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Webb v. Special Electric Company, Inc.
__________________________________________________________________________________

Unpublished Opinion
Original Appeal
Original Proceeding
Review Granted XXX 214 Cal.App.4th 595
Rehearing Granted

__________________________________________________________________________________

Opinion No. S209927
Date Filed: May 23, 2016
__________________________________________________________________________________

Court: Superior
County: Los Angeles
Judge: John Shepard Wiley, Jr.

__________________________________________________________________________________

Counsel:

Paul & Hanley, Dean A. Hanley, Anthony E. Vieira; Law Office of Ted W. Pelletier and Ted W. Pelletier
for Plaintiffs and Appellants.

Horvitz & Levy, Lisa Perrochet, Curt Cutting, Jason R. Litt; Brydon Hugo & Parker, Hugo Parker, Edward
R. Hugo, James C. Parker, Jeffrey Kaufman and Josette D. Johnson for Defendant and Respondent.

Shook, Hardy & Bacon, Mark A. Behrens, Christopher E. Appel and Patrick Gregory for Coalition for
Litigation Justice, Inc., Chamber of Commerce of the United States of America, NFIB Small Business
Legal Center and American Chemistry Council as Amici Curiae on behalf of Defendant and Respondent.

Deborah J. La Fetra for Pacific Legal Foundation as Amicus Curiae on behalf of Defendant and
Respondent.

Armstrong & Associates and William H. Armstrong for Elementis Chemicals Inc., as Amicus Curiae on
behalf of Defendant and Respondent.
Counsel who argued in Supreme Court (not intended for publication with opinion):

Ted W. Pelletier
Law Office of Ted W. Pelletier
22 Skyline Road
San Anselmo, CA 94960
(415) 454-8783

James C. Parker
Hugo Parker
135 Main Street, 20th Floor
San Francisco, CA 94105
(415) 808-0300