Daily Blast September 2, 2015

Yesterday, the California Court of Appeal, First Appellate District, Division Three (San Francisco) published its opinion in Johnson v. United States Steel Corp. (Sep. 1, 2015, A142485) __ Cal.App.4th __, analyzing whether the supplier of raw material used in the manufacture of another product can be held liable for design defect under the consumer expectation test if the raw material itself is not defective. (Slip opn., pp. 1-2.) The Court of Appeal held that the supplier of a raw material used in the manufacture of another product can be held liable for design defect only if the raw material itself is inherently defective. The court, however, reversed the summary judgment granted by the trial court because the record did not contain evidence negating the existence of a design defect under this test. (Id. at p. 2.)

Plaintiffs sued defendants, including the United States Steel Corporation (“U.S. Steel”), for exposure to benzene-containing products that allegedly caused plaintiff’s acute myeloid leukemia.  U.S. Steel supplied a fabricator with a benzene-containing coal residue called raffinate. (Slip opn., p. 1.) The trial court granted summary judgment to U.S. Steel finding insufficient evidence to support plaintiffs’ causes of action for negligence and strict products liability under a design defect theory. (Ibid.) Plaintiffs timely appealed from the judgment. (Id. at p. 6.)

The Court of Appeal held that summary judgment was not appropriate because whether the product raffinate is defective is a question of fact. The court also held that no case has previously determined whether the coal-based raffiate produced and sold by U.S. Steel is a defective product and the record contained no evidence from which this factual determination could be made. (Slip opn., p.  17.) Thus, the trial court erred in granting summary judgment because U.S. Steel never met its burden of presenting evidence negating the existence of a design defect in the raffinate and the record contained evidence that created a triable issue of material fact. (Ibid.) As a result, the Court of Appeal reversed the judgment and remanded to the trial court with directions to deny the motion for summary judgment. (Id. at p. 18.)