were negligent in failing to warn plaintiffs; that defendants breached and implied warranty of merchantibility; that defendants' products were unreasonably dangerous and unsafe for their intended use; and that defendants conspired fraudulently to misrepresent the nature and the extent of the harm caused by exposure to asbestos. The corporate defendants filed cross-claims against the United States for contribution and indemnity.
Plaintiffs have joined the United States in the pending motions, representing that they will dismiss without prejudice their claims against the United States if the Court should decide to dismiss or sever the cross claims. The Court is therefore in the peculiar position of considering argument by defendants, opposed by the additional defendant, that the Court has jurisdiction to hear plaintiffs' claims. Clearly, if the Court has jurisdiction over any of plaintiffs' claims, wherein defendants and additional defendants may be joint tort feasors, then it has jurisdiction over defendants' cross-claims against the United States for contribution.
1. The Government as a Supplier of Asbestos
The United States argues that its activities do not fall within the exception to sovereign immunity marked out by the Federal Tort Claims Act. Rather, this Court is urged to find that the actions of the United States fall within an exception to that exception, the "discretionary function" protection retained by the United States under 28 U.S.C. § 2680.
Because plaintiffs' claims against the United States, and derivatively, defendants' cross-claims are based on tort theories analysis must focus on the scope of the sovereign immunity of the United States. The United States, argue defendants, is liable because it has shed its sovereign immunity for these kinds of tort claims.
The Federal Tort Claims Act states in relevant part, the "United States shall be liable, respecting the provisions of this title relating to tort claims, in the same manner and to the same extent as a private individual under like circumstances." 28 U.S.C. § 2674. That provision is narrowed by subsequent language which states in relevant part that "the provisions of this chapter . . . shall not apply to -- (a) any claim . . .  based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused." 28 U.S.C. § 2680.
As stated above, counts I, II, and III of plaintiffs' amended complaint (incorporated by reference in paragraph 22 of Count VI against the United States) allege that defendants sold asbestos to which plaintiffs were negligently exposed, in breach of implied warranties, and in violation of a "strict duty" imposed upon defendants as "producers, manufacturers, and commercial sellers" of asbestos.
The United States admits that in October, 1969, it sold "15 short tons" of crocidolite asbestos fiber to plaintiffs' employer. The United States has presented the Court with a detailed and thoroughly documented history of this sale, including the enabling statutes and orders: the Strategic and Critical Materials Stockpiling Act, 50 U.S.C. §§ 98 et seq., the Federal Property and Administrative Services Act of 1949, 40 U.S.C. 471 et seq., Reorganization Plan No. 1 of 1958, 23 F.R. 4991, 72 Stat. 1799, Executive Order No. 11051 (1962) reprinted in 50 App. U.S.C. § 2271. With regard to the sale of asbestos, in 1966, by Public Law 89-463, Congress authorized the Administrator of the General Services Administration to dispose of approximately 45,992 short tons of crocidolite asbestos held in stockpiles previously authorized by the statutes cited above. There seems to be no question that the sale of asbestos to plaintiffs' employer was authorized.
From all the affidavits offered by the United States it appears that there was extreme caution exercised by the government with regard to avoiding disruption of the usual markets for operating producers, processors, and consumers. It is also clear that the government, by decree of Congress, sought to avoid any extra expense to itself. Therefore, the government dealt only with experienced asbestos handlers, "in the original packing, with the same markings and in basically the same condition as it was acquired and stored." (Declaration of John G. Harlan, Jr., then Commissioner of the Property Management and Disposal Service, at para. 10). The asbestos was therefore sold "as is" and F.O.B. carriers conveyance at the storage site.
The sale to Certain-Teed, plaintiffs' employer was typical. On October 15, 1969 a contract was executed for the sale of fifteen short tons of crocidolite asbestos to Certain-Teed. The written agreement stated "This is an 'as-is' sale," and the appended "General Terms and Conditions for the Sale of Strategic and Critical Materials" contained the following:
Condition of Material. Unless otherwise specifically stated in the invitation, all material therein is offered "as is". The description of the material is based on the best information available to the Government. However, the Government makes no warranty, express or implied, as to the quantity, kind, character, quality, weight, size or description of the material or its fitness for any use or purpose.
At the outset, the Court notes that the precise issue presented in this case was decided in Stewart v. United States, 486 F. Supp. 178 (C.D.Ill.1980). In that case the judge held that
The decision to sell the asbestos in unmarked crates to knowledgeable buyers involved a weighing of economic and other policy factors, and falls within the discretionary function exception.