The public policy behind product liability law is still protected. It is also argued that suppliers to sophisticated intermediaries

1. Most Common Reasons
Consumer advocates argue that this may leave some victims with fewer remedies and that liability for
injuries should be spread to any supplier in the stream of commerce as a cost of doing business. However,
injured persons would not be unfairly treated since they can still assert failure-to-warn claims against the
sophisticated intermediary. Further, they can still sue all upstream manufacturers and suppliers for design
or manufacturing defects. The public policy behind product liability law is still protected.
It is also argued that suppliers to sophisticated intermediaries are not harmed since they can simply seek
equitable indemnity against the sophisticated intermediaries. The practical problems are (1) such
sophisticated intermediaries usually settle out with a good faith settlement determination pursuant to Code
of Civil Procedure section 877.6, thus barring any equitable indemnity claims, (2) the sophisticated
intermediary may be bankrupt, or (3) if the sophisticated intermediary is the plaintiff's employer, it is
protected under the exclusivity of workers' compensation laws.
These Reasons are Also Recognized by
the Component Parts Doctrine
The rationale for shielding upstream manufacturers and suppliers from liability is similar
to that in the component parts doctrine which, under certain circumstances, limits liability
to the manufacturer of the final product. The corporate attorneys recognize that the
manufacturer of the final product is in a better position than any upstream component part
supplier to guarantee the safety of the final product. This doctrine shields such defendants
from all product liability causes of action, not just. failure-to-warn claims.
For example, in a sulfuric acid supplier washeld not liable for injuries causedby a cleaning
solution containing the acid. The court noted that it was "realistically feasible or necessary
to the protection of the public to require the manufactureror supplier of a standard chemical
ingredient... not having control over the subsequent compounding, packaging or marketing
of an item... to bear the responsibility for that injury”.
Another example is where the court held that a component part manufacturer that did not contribute to
the design of the finished product was not liable for its defective design. Following Walker and Lee, the
Restatement Third of Torts, Products Liability § 5, established that a component part supplier is subject to
liability for injuries resulting from a finished product only if either a defect in the component part itself
caused the harm or the component part supplier substantially participated in the design of the finished
product.
The court in Artiglio, established four factors to consider before applying the component part doctrine,
one of which is whether the user of the raw material is a sophisticated buyer; aware of the possible
hazards of using the material. Some courts have declined to apply this defense to suppliers of raw
asbestos,because asbestos fibers are not altered in the manufacturing process and remain dangerous. This
exception for asbestos does not affect the analysis for failure-to-warm claims as opposed to product defect
claims.
The Artiglio factors were recently applied in Maxton v. Western States Metals. Plaintiff
Maxton sued manufacturers of raw metal products claiming that toxic fumes were released
during his use of the metalproducts. The court sustained demurrersto the complaint holding
that a plaintiff cannot maintain an action in strict liability or negligence against a component
part supplier of raw metal products absent extraordinary circumstances. Among other
things, the Court found that the buyer, plaintiff's employer, was a "sophisticated industrial
enterprise" with extensive experience purchasing metalproducts, which it then substantially
processed with no design input from the suppliers of the raw metal products. (Id.at p. 93.)