The opinion of the court was delivered by: MUIR
1. Plaintiff General Instrument Corporation ("plaintiff") was a Delaware corporation with its principal place of business in New York City, New York, at the commencement of this action (Uncontested Statement of Facts No. 1).
2. Defendant Pennsylvania Pressed Metals, Inc. ("defendant") was a Pennsylvania corporation with its principal place of business in Emporium, Pennsylvania, at the commencement of this action. (Uncontested Statement of Facts No. 2).
3. Third-party defendant Tenneco Chemicals, Inc. ("third-party defendant") had its principal place of business in Chestertown, Maryland, at the commencement of this action. (Uncontested Statement of Facts No. 3).
4. The amount in controversy is in excess of $10,000. (Uncontested Statement of Facts No. 4).
5. Plaintiff was a contractor under a contract with the United States Government for the manufacture of a bomb fuse described as the M 904E2 bomb fuse (Uncontested Statement of Facts No. 5).
6. Defendant's business is the manufacture of pressed powdered metal parts. (Tr. June 13, 1973, p. 157).
7. Third-party defendant is and its predecessor was a manufacturer of a lubricant known as Anderol 401D which was used by defendant to impregnate sleeve bearings sold to plaintiff. (Uncontested Statement of Facts No. 7).
8. The bronzed metal sleeve bearings which are the subject matter of this suit were manufactured during 1968 and 1969 by the defendant for three separate bomb fuse contractors, plaintiff herein, Raytheon and Honeywell Manufacturing Company. (Tr. June 14, 1973, p. 225).
9. In the manufacture of the sleeve bearings, the metal powder was placed into a die in a press, compacted into the desired configuration, and then ejected from the press. (Tr. June 14, 1973, p. 156).
11. The sintering process resulted in some distortion because of the melting so that after the part was cooled, it had to be run through a sizing press that corrected any dimensional distortion and returned the piece to the initial shape and dimensions. (Tr. June 14, 1973, p. 159).
12. Where parts were to be later impregnated with a special lubricant this same lubricant was used as a coolant during the sizing operation. A special oil, Anderol 401D, was normally used as a coolant during the sizing operation of the bearings manufactured by defendant for plaintiff. (Tr. June 14, 1973, p. 160).
13. After the parts were sized they were inspected for dimensional characteristics, structural strength, and porosity. (Tr. June 14, 1973, p. 161).
14. After the testing was completed, the parts were impregnated with oil which resulted in oil being imparted to the interior portions of the part as well as the surface. (Tr. June 14, 1973, p. 162).
15. The purpose of impregnating a part with oil is to create a permanent reservoir of lubricant inside the part so that for all practical purposes it will never need lubrication during its lifetime. As soon as the part is subject to friction the resulting heat causes the oil to flow from the part and lubricate the two surfaces which caused the friction. When the movement stops and the area cools the oil is drawn back into the part through capillary action. This same process is repeated each time the part is used. (Tr. June 14, 1973, p. 162).
16. The defendant's vacuum impregnating tank was permanently hooked up by means of hoses to permanent oil storage tanks which contained various types of oils that were most commonly used. When specialty oil such as Anderol 401D was called for, an auxiliary hose was used which ran directly to the drum containing the specialty oil. (Tr. June 14, 1973, p. 170).
17. The actual oil impregnation process involved the following steps:
(a) Lowering the parts in a basket into the vacuum tank;
(b) Drawing a vacuum in the tank;
(c) After the vacuum has been drawn, the valves to the oil tank are opened and the vacuum draws the oil into the tank through the bottom of the tank. The amount of oil introduced into the tank is determined by a sight gauge which permits the operator to see into the tank;
(d) When the tank is filled with the correct amount of oil, the oil valve is closed and approximately ten pounds PSI of positive air pressure is introduced into the tank;
(e) This air pressure forces the oil into the pores of the parts in the tank;
(f) After the parts have been under this pressure for approximately five minutes, the valves to the oil storage tanks are reopened and the air pressure forces the oil back into the holding tank passing through a filter on the way.
(g) The tank is opened and the basket containing the parts removed.
(Tr. June 14, 1973, p. 175).
18. After the parts are removed, they are poured out of the basket onto a metal drain table where excess oil is allowed to drain off the parts. (Tr. June 14, 1973, p. 167).
19. When the impregnating tank was opened after the impregnation process was completed, four to six parts were taken off the top of the materials in the basket and these were then sent to the Inspection Department to determine whether the parts had been impregnated with adequate amounts of oil. (Tr. June 14, 1973, p. 208).
20. After the parts had been allowed to drain on the drain table, they were then placed in plastic bags inside cardboard cartons and sent to the shipping area for shipment to the customer. (Tr. June 14, 1973, p. 188).
21. The plastic bag in which the parts were placed was merely folded over and was in no way sealed. It was then put into the cardboard box and that box was sealed with tape. (Tr. June 14, 1973, p. 189).
22. The box was then stencilled for shipment and placed on a pallet in the shipping area to await the carrier. (Tr. June 14, 1973, p. 190).
23. The regular oils in more common use that were stored in the permanent storage tanks alongside the impregnating tank were heated by means of a gas heater so that the oil would travel through the lines faster and impregnate the parts faster. (Tr. June 14, 1973, p. 179).
24. These oils held in the permanent storage tanks were kept at temperatures anywhere from 130 to 180 degrees. (Tr. June 14, 1973, p. 256).
25. When parts were impregnated with the heated oil and then removed from the impregnating vessel the parts were hot and it should have been apparent to the operator that hot oil had been used in the impregnation. (Tr. June 14, 1973, p. 184).
26. The specialty oils, such as Anderol 401D, that were stored in their own container were not heated prior to impregnation and were used at room temperature. (Tr. June 14, 1973, p. 184).
27. In the early part of 1968, defendant was recommended to plaintiff by the United States as a qualified manufacturer of sleeve bearings fit for use in the M ...