Rhode Island High Court Rejects Verdict Against Paint Makers

An insurance industry lawyer, Phil Goldberg, commented, "The Rhode Island Supreme Court this morning put an important nail in the coffin of recent efforts to expand public nuisance theory into a super tort that can overcome all previous known bounds of civil liability. The rule of law won out today."

Mr. Goldberg, with Shook, Hardy & Bacon, Washington, D.C., has followed the case for the insurance industry and industry trade groups since 2000–the year after the case was first brought–and filed a friend of court brief on behalf of the manufacturers.

He said the Rhode Island court not only held that the four elements needed to comprise a suit using public nuisance laws against the four major manufacturers were missing, "but that it would be inappropriate to use this tort in suing product manufacturers in an effort to get around product liability laws."

The 2006 jury verdict against the manufacturers held them liable for creating a public nuisance by manufacturing and selling a toxic product. In satisfying the verdict, the state had proposed that the companies spend an estimated $2.4 billion to inspect and clean hundreds of thousands of homes built before 1980 that it said were likely to contain lead paint.

Rhode Island was the first state to sue over the harms of lead paint, which studies have shown can cause brain damage, coma and even death in children exposed to flaking paint chips or dust. The state's lawsuit targeted former makers of lead pigment, which had long been used in paint to make it more durable.

The first trial ended in 2002 with a hung jury.

The case went to trial again in the fall of 2005. The jury ruled against three manufacturers and absolved a fourth, Atlantic Richfield Co. It was the only court case the lead paint industry has lost.

Several suits are still pending, including cases in Ohio and California. The top courts in New Jersey and Missouri last year rejected public nuisance lawsuits against the companies, while a jury in Milwaukee in November ruled in favor of NL Industries in a suit brought by the city.

In Ohio, Mr. Goldberg said a decision of the Ohio Supreme Court upholding a new law barring these suits effectively ended cases there.

In California, an Appeals Court in April upheld the right of large cities to use private outside counsel working on a contingency basis to pursue cases that have been pending since 2000.

California cities including Los Angeles may use private lawyers to sue lead paint manufacturers for the cost of treating lead-induced illness and other actions to protect the public from the toxic product, a California appeals court has ruled.

If it stands, the appeals court ruling would have a broad impact because communities suing the paint makers also include San Francisco, Oakland, San Diego, Santa Clara, San Mateo, Monterey, Solano and Alameda.

But Mr. Goldberg questioned the ability of the California communities to ultimately win their cases. "As the Rhode Island Supreme Court recognized in oral arguments, many people were waiting for this decision," he said.

Mr. Goldberg noted language in the Rhode Island decision that the state "has not and cannot allege any set of facts to support its public nuisance claim that would establish that defendants interfered with a public right or that defendants were in control of the lead pigment they, or their predecessors, manufactured at the time it caused harm to Rhode Island children."

"In reaching this conclusion, we do not mean to minimize the severity of the harm that thousands of children in Rhode Island have suffered as a result of lead poisoning," the court said.

"Our hearts go out to those children whose lives forever have been changed by the poisonous presence of lead," it added.

"But, however grave the problem of lead poisoning is in Rhode Island, public nuisance law simply does not provide a remedy for this harm," the court said.

"The state has not and cannot allege facts that would fall within the parameters of what would constitute public nuisance under Rhode Island law," the court said.

Mr. Goldberg said comments in the decision covered points in the brief he filed concerning the four elements needed to yield a verdict against manufacturers based on public nuisance laws.

He pointed to language in the decision that said, "…defendants were not in control of any lead pigment at the time the lead caused harm to children in Rhode Island, making defendants unable to abate the alleged nuisance, the standard remedy in a public nuisance action."

Furthermore, the decision said, "the General Assembly has recognized defendants' lack of control and inability to abate the alleged nuisance because it has placed the burden on landlords and property owners to make their properties lead safe."

The National Association of Mutual Insurance Companies (NAMIC)–which joined with other organizations to file a "friend of the court" amicus brief in the case–said in a statement that the decision "reestablishes that product liability laws, not public nuisance laws, are the proper means for claims against product manufacturers."

Paul Tetrault, NAMIC's Northeast state affairs manager, said the court "rejected another attempt by a state attorney general to improperly use public nuisance laws to circumvent the well-defined structure of product liability laws."

"Under the trial court's application of public nuisance law in this case, the government would have near limitless ability to impose liability on an industry if its products could at some point contribute to an inherent risk to enough people," the organizations argued in their amicus brief.

"Any business that ever lawfully made or sold a product could be held liable in Rhode Island at the whim of the attorney general if the product category as a whole were misused or not properly maintained by certain members of the public and, as a result, became associated with a potential hazard," the groups added in their brief.

The result would have been the creation of a cause of action to which there would be practically no defense, according to Mr. Tetrault.