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Government contractor immunity does not shield General Electric from liability for an alleged failure to warn a Camden shipyard worker that the steam turbines it built for the USS Kitty Hawk would ultimately be insulated with asbestos-containing materials, an Eastern District of Pennsylvania federal judge has ruled. A lawyer for the plaintiffs in the case said there may be thousands of cases nationwide involving inadequate safety warnings allegedly provided by government contractors to defense workers in civilian-owned facilities. In denying GE’s motion for summary judgment in Chicano v. General Electric Co., U.S. Senior District Judge Thomas N. O’Neill Jr. ruled that there is still an issue as to whether GE had satisfied one of the three prongs needed to qualify for government contractor immunity. “GE has shown that its turbines conformed to all the [U.S.] Navy’s stringent specifications regarding the turbines themselves,” O’Neill wrote. “However, GE did not include any notes, cautions, warnings or safety notices regarding the hazards of asbestos-containing materials… . There is at least a genuine issue of material fact as to whether GE had a duty to supply such warnings regarding the dangers associated with the asbestos-containing products that it knew would cover its turbines… . There is at least a genuine issue of material fact as to whether GE has satisfied the second prong [of the government contractor defense].” According to O’Neill’s opinion, Raymond Chicano — who had worked as a sheet metal mechanic at the New York Shipyard in Camden, N.J., from 1959 to 1962 — died of mesothelioma in June at the age of 64. Chicano’s attorney, Lee Balefsky of Kline & Specter, said he believes the case is one of thousands of similar claims filed throughout the country against government contractors who claim they should be immune from liability for failure to warn about safety issues stemming from the government’s own specifications. “The court made a point that, in order to [meet] the contractor defense, a manufacturer … has an independent obligation to provide warnings regarding products which they may not have controlled or supplied,” said Balefsky, who was assisted in the case by associate Michelle Tiger. While working aboard the USS Kitty Hawk, according to Balefsky, Chicano had been an employee of the shipyard, not the Navy. Chicano had spent roughly 40 percent of his time aboard the aircraft carrier working on ventilation ducts in the ship’s boiler rooms, according to the opinion. The marine steam turbines for the ship were manufactured and supplied by GE under a contract with the Navy and were designed according to an “extensive” set of Navy specifications, O’Neill wrote. “The turbines required thermal insulation to operate properly and safely,” O’Neill wrote. “However, GE did not include any insulation materials, asbestos or otherwise, with its turbines when they were shipped to the Navy… . Nevertheless, GE knew that its turbines would be insulated with asbestos-containing materials… . Before the Kitty Hawk was built and before Chicano worked on the ship, both the Navy and GE knew that asbestos posed certain health risks.” GE did not supply warnings of the dangers of asbestos, O’Neill continued, and Chicano was never warned about the dangers related to the insulation material. Before turning to the issue of government contractor defense, O’Neill applied Pennsylvania tort law to Chicano’s individual claims, holding that there was a genuine issue of material fact as to whether the turbines’ insulation had caused Chicano’s mesothelioma. Chicano’s case has the potential to satisfy the “frequency and regularity” test set out by the Pennsylvania Superior Court in its 1988 decision in Eckenrod v. GAF Corp., O’Neill held, because he presented evidence that he spent nearly half of his time working around insulated turbines in cramped boiler rooms. Following Pennsylvania’s four-part test for plaintiffs seeking to institute strict product liability actions, O’Neill concluded that there was a genuine issue of material fact as to whether GE had a duty to warn; whether it had breached that duty; whether the turbines were defective when shipped to the Navy, because of inadequate warnings; and whether Chicano would have heeded a warning had one been issued. Under the U.S. Supreme Court’s 1988 opinion in Boyle v. United Technologies Corp., O’Neill wrote, a court analyzing a government contractor’s request for immunity must first determine whether the relevant state tort law is in conflict with the federal interests related to federal procurement contracts. “The imposition of liability on GE creates a significant conflict with the federal interests associated with federal procurement contracts because the liability cost of products liability suits arising out of the contract will be passed on to the government, which is the consumer,” O’Neill wrote. Where such a conflict exists, according to the opinion, Boyle calls for the application of a three-part test in order to determine whether the defendant will be immune from liability under state tort law. Under the Boyle test, liability under state law cannot be imposed when the federal government has approved clear-cut specifications; when the equipment conformed to those specifications; and when the supplier warned the U.S. of dangers related to the equipment’s use about which the government had not been previously aware. “If the contractor meets all three prongs, the government contractor defense is established and defendant manufacturer is immune from liability under state law,” O’Neill wrote, noting that the defense bears the burden of proving each element. O’Neill concluded that GE showed that the government had issued extensive specifications relating to all aspects of the aircraft carrier’s design, meeting the first prong. He later ruled that the Navy had as much knowledge as GE — if not more — concerning the dangers of asbestos, thereby satisfying the third prong. But as GE in supplying its turbines to the Navy did not include any sort of safety notice warning of the dangers of asbestos-containing materials, O’Neill wrote, an issue remains as to whether the second prong has been satisfied. Balefsky called O’Neill’s ruling “significant in terms of asbestos litigation.” “I believe this is the first time the court has ruled that there is a genuine issue of material fact as to whether or not a manufacturer has a duty to provide warnings, given the fact that they have [related] obligations that are required of them under their contract with the government,” Balefsky said. GE’s attorney in the matter, E. Michael Keating III of Hollstein Keating Cattell Johnson & Goldstein, did not immediately return calls seeking comment.

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