PA SUPREME COURT RESTRICTS LIABILTY ALLOCATION, ALLOWS BANKRUPT ENTITIES ON VERDICT SHEET
By: Timothy D. Rau
Marshall Dennehey Warner Coleman & Goggin
In a long-awaited opinion, the Pennsylvania Supreme Court has issued an opinion on the application of Pennsylvania’s Fair Share Act to strict products liability asbestos cases by holding that juries cannot allocate percentages of fault but can hold bankrupt entities liable as long as the plaintiff has settled with the trust.
In Roverano v. John Crane, 26 EAP 2018, the court was asked to consider whether the Fair Share Act, 42 PA. C.S. Sec. 7102, required a factfinder to apportion liability on a percentage basis, as opposed to per capita, in strict liability asbestos cases. The court also considered whether the Act requires a factfinder to apportion liability to bankrupt entities that entered into a settlement release with the plaintiff. On these issues, the court held that the factfinder could not apportion fault on a percentage basis in asbestos cases but allowed the jury to consider liability against bankrupt non-parties who have settled with the plaintiff.
The appeal was the result of a trial in which the plaintiff argued that his lung cancer was caused by exposure to asbestos from the defendants’ products. In a case that proceeded solely on a theory of strict products liability, the defendants sought to have the jury allocate percentages of fault amongst them and sought to include the 14 bankrupt entities that the plaintiff had applied to for compensation. The trial judge denied the defendants’ requests on both of these issues.
After a finding and damages award in favor of the plaintiff, the defendants appealed. The PA Superior Court subsequently held that the jury was permitted to allocate percentages of fault amongst the liable defendants. The plaintiff appealed the Superior Court’s ruling and argued that the Fair Share Act did not permit percentages of fault in asbestos cases and that the common law rule of allowing per capita allocations should continue to be applied.
The Roverano’s argued that a jury could not isolate one defendant’s product and determine what percentage of harm the product caused the plaintiff. They further argued that no expert, let alone a jury, could divide liability amongst defendants when no expert can say that the asbestos from any one product caused the harm to the plaintiff.
The court considered the statutory construction of the Fair Share Act and concluded that the statute only required calculating liability in negligence cases, and did not intend for such a calculation to be applied in all cases. Citing prior cases finding that a jury could not allocate fault amongst joint tortfeasors in strict liability cases, the court held that liability must be equally apportioned among strictly liable joint tortfeasors absent a directive from the legislature on the issue. The court also discussed the fact that asbestos cases involve one indivisible injury from multiple exposures and that it is impossible for anyone to separate one exposure as a cause, versus another. As a result, the court reversed the Superior Court’s ruling and held that the Fair Share Act does not require percentage apportionment of fault in strict liability asbestos cases.
The other key issue decided by the court was whether bankrupt entities could be considered by the jury for apportionment of liability. The Fair Share Act allows for apportioning to “any non-party who has entered into a release with the plaintiff.” The court held that the Act permits a factfinder to apportion liability to those bankruptcy trusts that have entered into releases with the plaintiffs and were not named defendants. The court emphasized that in order for the settled bankrupt entity to be included on the verdict sheet and allocated liability, adequate proofs of exposure and causation are required.
Chief Justice Saylor wrote a dissenting opinion which joined in the court’s ruling on the issue of bankrupt entities, but disagreed with the court’s ruling on apportionment. The dissent argues that the clear intent of the legislature was to allow the same method of allocation in both negligence and strict liability cases. It further argues that a jury could engage in risk-based assessment in order to allocate fault amongst defendants. He specifically mentions that the statute intended for a jury to differentiate liability between an insulation manufacturer whose product releases friable asbestos and a manufacturer whose product contains asbestos encapsulated in resin.