Artiglio v. Corning Inc.
76 Cal. Rptr. 2d 479, 18 Cal.4th 604, 957 P.2d 1313 (1998)
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Rule of Law:
Under the negligent undertaking theory of Restatement (Second) of Torts § 324A, a duty of care to a third party does not arise if, at the time the services were undertaken for another, the risk of physical harm to the third party was unforeseeable, attenuated, and remote.
Facts:
- In 1943, The Dow Chemical Company (Dow Chemical) co-founded Dow Corning Corporation (Dow Corning) as a 50/50 joint venture to develop silicone products.
- Beginning in 1948 and through the 1950s, Dow Chemical scientists conducted and published toxicology research on various silicones for Dow Corning, identifying both a low order of toxicity and potential hazards like irritation, inflammation, and organ effects.
- Some of these joint studies in the 1950s revealed that silicone compounds could migrate in mammals and cause liver changes in rats, but a follow-up observation by Dow Chemical researchers suggesting liver globules might be silicone was not included in a report sent to Dow Corning.
- In 1961, Dow Corning began developing silicone breast implants with a plastic surgeon, and clinical trials started in 1962.
- In 1964, Dow Corning established its own medical products division with its own staff of scientists and experts to market breast implants and other devices.
- In 1975, Dow Chemical granted Dow Corning the right to use its trademark, retaining the right to inspect Dow Corning's manufacturing processes to ensure product quality.
- Dow Chemical never manufactured or sold silicone gel breast implants.
- Plaintiffs are women who received silicone breast implants manufactured by Dow Corning and subsequently alleged physical harm.
Procedural Posture:
- Eda Artiglio and other plaintiffs filed lawsuits in California state courts against Dow Chemical and others, which were coordinated into a single proceeding.
- Plaintiffs asserted several causes of action, including negligence, against Dow Chemical based on its role as a parent company to implant manufacturer Dow Corning.
- In the trial court, Dow Chemical filed a motion for summary judgment, arguing it owed no duty of care to the plaintiffs.
- The trial court granted Dow Chemical's motion for summary judgment, finding as a matter of law that no duty was owed, and entered judgment in its favor.
- Plaintiffs appealed the trial court's judgment to the California Court of Appeal.
- The Court of Appeal affirmed the trial court's decision, also concluding that Dow Chemical owed no duty to the plaintiffs.
- Plaintiffs then petitioned the Supreme Court of California for review, which was granted.
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Issue:
Does a parent corporation that undertakes to perform limited, historical toxicology research on a component material for its subsidiary assume a duty of care to the ultimate consumers of the subsidiary's final product under the negligent undertaking doctrine of Restatement (Second) of Torts § 324A?
Opinions:
Majority - Werdegar, J.
No, the parent corporation does not assume a duty of care under these circumstances. For a duty to arise under the negligent undertaking theory, the actor must recognize that its services are necessary for the protection of the third party. Here, Dow Chemical's primary research occurred in the 1940s and 1950s, long before the plaintiffs received their implants and even before Dow Corning began marketing them. The court found that any risk of physical harm to the plaintiffs was exceedingly attenuated and remote at the time Dow Chemical performed its research. Therefore, it cannot be concluded that Dow Chemical should have recognized its services were necessary for the plaintiffs' protection, and no duty of care arose.
Dissenting - Mosk, J.
Yes, a triable issue of fact exists as to whether a duty of care was assumed. The majority incorrectly concludes that the risk of harm was unforeseeable as a matter of law. Dow Chemical knew from its own research as early as 1948 that silicones posed potential health hazards, and it was aware in the 1950s that silicones were being developed for medical implants in humans. The question of foreseeability in this context is more akin to a proximate cause analysis, which is a question of fact for a jury to decide, not a question of law to be resolved on summary judgment. Public policy does not support creating a judicial exception to the general duty of care for corporations that perform human toxicology research.
Analysis:
This decision significantly limits the scope of the negligent undertaking doctrine (or 'Good Samaritan' liability) as applied to parent corporations. By focusing on foreseeability at the time the undertaking was performed, the court creates a high bar for plaintiffs seeking to hold a parent company liable for historical research services provided to a subsidiary. The ruling establishes that a remote, attenuated connection between the parent's actions and the consumer's ultimate injury is insufficient to create a legal duty, especially when years have passed and the subsidiary has developed its own expertise. This precedent shields parent corporations from potentially indefinite liability for the products of their subsidiaries where the parent's involvement is not direct, continuous, and proximate to the final product's creation and sale.
