No. 08-461

Sn the ~upreme ~ourt at the ~niteb ~tate~

DANIEL RAYMOND STEPHENSON ET AL.,

Petitioners,

V.

DOT CHEMICAL COMPANY, MONSANTO COMPANY,

ET AL.Respondents.

On Petition for a Writ of Certiorari tothe United States Court of Appeals

for the Second Circuit

BRIEF IN OPPOSITION

CHARLES A. ROTHFELDMayer Brown LLP1909 K Street, NWWashington, D.C. 20006(202) 263-3000

ANDREW L. FREY

Counsel of RecordLAUREN R. GOLDMANCHRISTOPHER J. HOUPTMayer Brown LLP1675 BroadwayNew York, NY 10019(212) 506-2500

Counsel for RespondentThe DoT Chemical Company

ADDITIONAL COUNSEL LISTED ON INSIDE COVERS

JAMES V. AIOSARICHARD S. FELDMANRivkin Radler LLP926 RexCorp PlazaUniondale, NY 11556(516) 357-3000

JAMES L. STENGELLAURIE STRAUCH WEISS

Orrick, Herrington &Sutcliffe LLP

666 Fifth AvenueNew York, NY 10103(212) 506-37’75

Counsel for RespondentTheDow Chemical Company

WILLIAM A. KROHLEYWILLIAM C. HECKKelley Drye & Warren

LLP101 Park AvenueNew York, NY 10178(212) 808- 7800

Counsel for RespondentHercules Incorporated

LAWRENCE D’ALOISE, JR.Clark, Gagliardi &

MillerThe Inns of Court99 Court StreetWhite Plains, NY 10601(914) 946-8900

Counsel for RespondentsT.H. Agriculture & Nutri-tion Co., Inc., Thompson-Hayward Chemical Co.,and Harcros Chemicals,Inc.

MICHAEL M. GORDONMcKee Nelson LLPOne Battery Park Plaza34th FloorNew York, NY 10004(917) 777-4567

Counsel for RespondentsOccidental Chemical Cor-poration, as s~ccessor bymerger to DiamondShamrock Ch,zmicalsCompany; Maxus EnergyCorporation; Tierra Solu-tions, Inc., formerlyknown as Chemical LandHoldings, Inc.; and ValeroEnergy Corpo~,ation, assuccessor by merger to Ul-tramar Diamond Sham-rock Corporation

JOHN C. SABETTAANDREW T. HAHN, SR.

Seyfarth Shaw LLP620 Eighth AvenueNew York, NY 10018-

1405(212) 218-5509

RICHARD P. BRESSLatham & Watkins555 Eleventh Street, NW,

Suite 1000Washington, D.C. 20004(202) 637-2137

Counsel for Respondent

SETH P. WAXMAN

PAUL R.Q. WOLFSON

MARY K. GARDNER

Wilmer Cutler PickeringHale and Dorr LLP

1875 Pennsylvania Ave.NW

Washington, D.C. 20006(202) 663-6000

JAMES E. TYRRELL, JR.Patton Boggs LLPThe Legal CenterOne Riverfront Plaza -

6th FloorNewark, NJ 07102(973) 848-5620

Monsanto Company

MYRON KALISH50 East 79th StreetNew York, NY 10021

Counsel for RespondentsUniroyal, Inc., UniroyalChemical Co., and CDUHoldings, Inc.

i

COUNTER-STATEMENT OF THEQUESTION PRESENTED

Whether the government contractor defense pro-tects manufacturers of military defoliants againsttort claims based on the presence of dioxin contami-nation in a government-specified product, where themilitary ordered the product after analyzing its toxic-ity and concluding that it presented no materialhealth risk, and any allegedly undisclosed hazardswere immaterial to the government’s discretionarydecision.

ii

RULE 29.6 STATEMENT

Respondent Monsanto Company h~Ls no parentcompany, and no publicly-held company owns 10 per-cent or more of its stock.

Respondent The Dow Chemical Company has noparent company, and no publicly-held company owns10 percent or more of its stock.

Respondent Occidental Chemical Corporation,the successor by merger to Diamond ShamrockChemicals Company (which was known prior to Sep-tember 1, 1983 as Diamond Shamrock Corporation),is an indirect, wholly-owned subsidiary of OccidentalPetroleum Corporation, a publicly-held company.

Respondent Valero Energy Corporation, the suc-cessor by merger to Ultramar Diamond ShamrockCorporation, has no parent company, and no pub-licly-held company owns 10 percent or more of itsstock.

Respondent Maxus Energy Corporation is an in-direct, wholly-owned subsidiary of YPF S.A. Ap-proximately 85 percent of YPF S.A.’s stock is ownedby Repsol YPF S.A., a publicly-held company.

Respondent Tierra Solutions, Inc., formerlyknown as Chemical Land Holdings, Inc., is an indi-rect, wholly-owned subsidiary of YPF S.A. Approxi-mately 85 percent of YPF S.A.’s stock is owned byRepsol YPF S.A., a publicly-held company.

Respondent Hercules Incorporated[ is whollyowned by Ashland Inc., a publicly-held company.

Respondent Uniroyal, Inc. is a dissolved corpora-tion.

Respondent C.D.U. Holdings, Inc. is a dissolvedcorporation.

III

Respondent Uniroyal Chemical Corp. is whollyowned by the Crompton Corporation, a publicly-heldcompany.

Respondent T H Agriculture & Nutrition Com-pany, Inc. (now known as T H Agriculture & Nutri-tion L.L.C.) is a wholly-owned subsidiary of PhilipsElectronics North America Corporation. PhilipsElectronics North America Corporation is an indi-rect, wholly-owned subsidiary of Koninklijke PhilipsElectronics N.Vo, a publicly-held company.

Respondent Thompson-Hayward Chemical Co. isa subsidiary of Harcros Chemicals Inc.

iv

TABLE OF CONTENTS

PageCOUNTER-STATEMENT OF THEQUESTION PRESENTED ..........................................iRULE 29.6 STATEMENT ..........................................TABLE OF AUTHORITIES .......................................viCOUNTER-STATEMENT OF THE CASE ................3

A. Statement of Facts ............................................31. The Military’s Defoliation Program ............4

2. The Government’s Investigation ofPotential Health Hazards AssociatedWith Agent Orange .....................................5

3. The Government’s Efforts toIncrease Production of Agent Grange ........8

4. The Success of the DefoliationProgram ......................................................10

B. Litigation History ............................................C. The Decision Below .........................................12

REASONS FOR DENYING CERTIORARI .............16I. THE DECISION BELOW NEITHER

CREATES NOR DEEPENS A CIRCUITSPLIT ....................................................................18A. There Is No Conflict Among The Lower

Courts Concerning The Applicatio~a OfThe Defense To Defects Arising DuringThe Manufacturing Process ............................19

B. The Lower Courts Are In AgreementRegarding Application Of The FirstBoyle Prong ......................................................23

V

TABLE OF CONTENTS - continued

Page

C. The Circuits Are Also In AgreementRegarding Application Of The ThirdBoyle Prong .....................................................271. The Second Circuit Correctly Held

That The Contractor’s Duty Is ToInform The Government Of RisksThat Are Material To The ExerciseOf Governmental Discretion .....................27

2. There Is No Conflict Among TheLower Courts On This Question ...............30

3. Petitioners’ Policy Concerns AreMisplaced And Do Not Warrant ThisCourt’s Review ...........................................31

CONCLUSION ..........................................................34

vi

TABLE OF AUTHORITIES

Page(s)

CASESBailey v. McDonnell Douglas Corp.,

989 F.2d 794 (Sth Cir. 1993) ...............................22

Boyle v. United Techs. Corp.,487 U.S. 500 (1988) ......................................passim

Carley v. Wheeled Coach,991 F.2d 1117 (3d Cir. 1993) ........................22, 30

Delta Airlines, Inc. v. August,450 U.S. 346 (1981) .............................................20

Dow Chem. Co. v. Stephenson,539 U.S. 111 (2003) .......................................12, 33

Harduvel v. General Dynamics Corp.,878 F.2d 1311 (11th Cir. 1989) ..........’20-23, 25, 30

Hercules Inc. v. United States,24 F.3d 188 (Fed. Cir. 1994),affd, 516 U.S. 417 (1996) ....................................18

In re "Agent Orange" Prod. Liab. Litig.,597 F. Supp. 740 (E.D.N.Y. 1984) ...................5, 11

In re "Agent Orange" Prod. Liab. Litig.,818 F.2d 145 (2d Cir. 1987) .................................11

In re "Agent Orange" Prod. Liab. Litig.,818 F.2d 187 (2d Cir. 1987) ..........................passim

Ivy v. Diamond Shamrock Chems. Co.,996 F.2d 1425 (2d Cir. 1993) ...............................12

vii

TABLE OF AUTHORITIES - continued

Page(s)

CASES (cont’d)

Kleemann v. McDonnell Douglas Corp.,890 F.2d 698 (4th Cir. 1989) ...............................26

Lewis v. Babcock Indus., Inc.,985 F.2d 83 (2d Cir. 1993) ..................................14

Miller v. Diamond Shamrock Co.,275 F.3d 414 (5th Cir. 2001) ...............................18

Mitchell v. Lone Star Ammunition, Inc.,913 F.2d 242 (5th Cir. 1990) ..........................21-23

Neil v. Biggers,409 U.S. 188 (1972) .............................................33

Ramey v. Martin-Baker Aircraft Co.,874 F.2d 946 (4th Cir. 1989) ...............................30

Snell v. Bell Helicopter Textron, Inc.,107 F.3d 744 (9th Cir. 1997) .........................22, 26

Stephenson v. Dow Chem. Co.,273 F.3d 249 (2d Cir. 2003) ................................12

Stout v. Borg-Warner Corp.,933 F.2d 331 (5th Cir. 1991) ...............................30

Trevino v. General Dynamics Corp.,865 F.2d 1474 (5th Cir. 1989) .............................26

Zinck v. ITT Corp.,690 F. Supp. 1331 (S.D.N.Y. 1988) .....................21

BRIEF IN OPPOSITION TO CERTIORARI

These cases arise out of petitioners’ state-lawclaims that they were injured as a result of their ex-posure to various herbicides - referred to collectivelyas "Agent Orange" - that respondents manufacturedat the direction of the U.S. military for use in theVietnam War. Petitioners’ claims center on the pres-ence of trace amounts of dioxin in Agent Orange.The courts below held that the defendants are enti-tled to judgment based upon the government con-tractor defense.

This Court recognized the government contractordefense in Boyle v. United Technologies Corp., 487U.S. 500 (1988). The defense bars state tort liabilityfor injuries arising from products manufactured forthe government according to its specifications, thusprotecting contractors who have implemented discre-tionary government decisions to take risks that statelaw may condemn in the consumer sphere. The de-fense prevents plaintiffs from circumventing the dis-cretionary function exception of the Federal TortClaims Act by suing contractors for acts as to whichthe government is immune from suit. See id. at 511-12. Because contractors would pass expected liabil-ity costs back to the government through higherprices - or, worse, simply refuse to manufactureproducts that might subject them to liability - suitsagainst contractors for government decisions wouldundermine that exception.

Boyle precludes product defect suits against gov-ernment contractors for products (1) made pursuantto reasonably precise government specifications, (2)that complied with those specifications, and (3) as towhich the contractor warned the government of dan-

gers in the use of the product that were ]known to thecontractor but not to the government. Id. at 512."The first two of these conditions assure that the suitis within the area where the policy of the ’discretion-ary function’ would be frustrated" by tb~e impositionof state tort law. Ibid. The third "is necessary be-cause, in its absence, the displacement of state tortlaw would create some incentive for t:he manufac-turer to withhold knowledge of risks, since conveyingthat knowledge might disrupt the contract but with-holding it would produce no liability." Ibid.

All three of the courts of appeals that have beenpresented with Agent Orange litigation have heldthat Agent Orange represents a paradigmatic exam-ple of the need for the government contractor de-fense. The decision to pursue a defoliation strategyin the Vietnam War was made by President Ken-nedy. The government identified for itself the spe-cific herbicides and formulations that would be mosteffective for military purposes and ordered themfrom the defendants, prescribing the chemical com-position, concentrations, and labeling. The productsupplied by the manufacturers complied with thosespecifications. Government scientists carefully stud-ied the health risks associated with the planned useof those defoliants in Vietnam. They concluded thatthe defoliants were safe for that use, and that anyrisks were outweighed by a real and urgent militaryneed for the product. As the Second Circuit has re-peatedly observed, that conclusion was eminentlyreasonable: even today, there is no persuasive evi-dence that Agent Orange was hazardous to humanhealth, and it is undisputed that the success of thedefoliation strategy "saved many, perhaps thousandsof, lives." In re "Agent Orange" Prod. Liab. Litig.,

818 F.2d 187, 192-93 (2d Cir. 1987), cert. denied, 487U.S. 1234 (1988).

It is in the military context that the balance be-tween government discretion and the interests un-derlying consumer product liability law tilts mostsharply in favor of protecting governmental discre-tion. The government had the discretion to useAgent Orange to combat the extreme, immediaterisks posed to allied troops by Vietnam’s dangerousterrain, notwithstanding any purely speculativehealth effects. This decision was precisely the typeof contextual policy judgment that the discretionaryfunction exception protects: it "involve[d] not merelyengineering analysis but judgment as to the balanc-ing of many technical, military, and even social con-siderations, including specifically the trade-off be-tween greater safety and greater combat effective-ness," a process that is insulated from judicial "sec-ond-guessing." Boyle, 487 U.S. at 511.

The court below applied settled law to a uniqueand voluminous factual record, and arrived at a con-clusion that is plainly correct. This Court’s review isnot warranted.

COUNTER-STATEMENT OF THE CASE

A. Statement of Facts

Petitioners suggest that the Second Circuit erredin evaluating the record, but they ignore virtually allof the facts and evidence that the court relied on inits opinion. A brief summary of that evidence fol-lows.1 Although petitioners dispute the inferences

1 The opinion did not contain a full recitation of the underlying

facts, which already "have been addressed in so many differentjudicial opinions." Pet. App. 10a-lla.

4

that may be drawn from the record, they dispute al-most none of the historical facts.

1. The Military’s Defoliation Program

In the early 1960s, the United States’ efforts toassist the South Vietnamese governmenl~ in resistingthe communist insurgency were thwarted by thedense vegetation on the ground, which providedcover for Viet Cong ambushes and made it difficult tolocate and disrupt enemy supply lines. In June 1961,the unified command structure for U.S. forces inVietnam decided to evaluate the feasibility of a defo-liation strategy. That task was given an urgent pri-ority and was assigned to the Army Biological Labo-ratories at Fort Detrick, Maryland, an agency withinthe Department of Defense. A612.2

The Fort Detrick researchers quickly concludedthat none of the weed-killers available on the com-mercial market was up to the task of defoliating atriple canopy jungle with a limited number of spray-plane runs. A612; A402-03. Accordingly, the De-fense Department determined that the governmentwould need to develop its own defoliant compound foruse in Vietnam. Over the following twc, years, mili-tary scientists screened 1,410 chemical compounds,ultimately determining that a 50/50 mixture of 2,4-dichlorophenoxyacetic acid ("2,4-D") and 2,4,5-trichlorophenoxyacetic acid ("2,4,5-T") would be mosteffective and least toxic. A1870a-70b; ~,~ee also Pet.App. 12a.3

2 "A " cites refer to respondents’ appendix in the Second Cir-cuit.3 This was the formula for Agent Orange, which constituted

the bulk of the herbicide used in Vietnam. Other "Agents" con-

5

In 1963, the Army Munitions Command promul-gated the formal specifications that formed the basisfor the government’s procurement of Agent Orange.Pet. App. 121a; A2299-2334. The specifications alsoidentified, inter alia, the markings that would ap-pear on drums of Agent Orange, and prohibited anyother markings or warnings. Id. at 121a-22a.

The specifications called for mixtures that werevery different from the herbicides being produced forcommercial use. A typical commercial product con-taining 2,4-D and 2,4,5-T would also contain a sig-nificant percentage of inert ingredients and wouldrequire substantial dilution before application.A398. Agent Orange, by contrast, was far more con-centrated; it contained virtually no inert ingredientsand was used in undiluted form. In re "Agent Or-ange" Prod. Liab. Litig., 597 F. Supp. 740, 848-49(E.D.N.Y. 1984); see also Pet. App. 12a, 26a. Themilitary also planned to deploy the defoliant withoutdilution and at ’"extremely high dose rates"’ (Pet.App. 117a (quoting A402-03)) in order to achievemaximum results with the fewest applications, be-cause each spray run endangered the plane and thepilot.

2. The Government’s Investigation of Poten-tial Health Hazards Associated WithAgent Orange

Prior to launching a full-scale defoliation cam-paign, the government conducted extensive researchinto the toxicity of Agent Orange. Petitioners at-tempt, as they did in the courts below, to obscure

tained different proportions of the two chemicals, or even dif-ferent chemicals. For convenience, we refer to all mixtures as"Agent Orange" unless context requires differentiation.

these efforts and the resulting government knowl-edge by focusing on individual officials who testifiedthat they lacked knowledge of particular facts. Thatapproach, however, ignores the division of responsi-bility within the government. The agencies respon-sible for making each discretionary deci~,~ion concern-ing Agent Orange possessed all of the informationrelevant to their decisions.

At President Kennedy’s direction, the most im-portant toxicity research was conducted by the ArmyChemical Corps at Edgewood Arsenal. Pet. App.115a. The Edgewood toxicity experts were wellaware of the link between 2,4,5-T and dioxin. Theyreviewed all of the published literature on the toxic-ity of 2,4-D and 2,4,5-T; obtained unpublished infor-mation, including data from other government agen-cies; and performed their own toxicological studies onAgent Purple, a predecessor of Agent Orange thatcontained at least as much dioxin. Id. at 35a, A2589-94, A2602-03, A2610. The Edgewood task force knewthat dioxin was associated with the 2,4,5-T produc-tion process and further knew that it had causedchloracne and liver problems in production workersexposed to relatively high concentrations of dioxin.Pet. App. 35a, 46a, A2127-29, 2131.4

4 Petitioners’ citation-free assertion that "the existence, crea-tion and mechanism of the defect all still remained unknown toany government officers involved in that testing or the prod-uct’s procurement," Pet. 25, is thus unsupported by the record.As discussed below, at p. 24, plaintiffs’ references to the knowl-edge of "procurement" officers should not divert attention fromthe fact that the officers responsible for evaluating toxicity -the exercise of government discretion that is at the center ofthis case - possessed all available and material information.

Although the Army was aware that dioxin posedrisks to production workers, it concluded that AgentPurple - which, like Agent Orange, contained onlytrace amounts of dioxin - "posed no unacceptablehazard." Pet. App. 35a. The Army viewed dioxin asa concern only for manufacturers. Id. at 46a. A sen-ior Edgewood scientist testified that "[t]he Army’spurpose is to protect its own personnel who wouldnot be involved in the manufacture" of the product.The health risks associated with dioxin exposurewere "a significant fact for the manufacturer, but notfor the Army." A2129; see also Pet. App. 47a.

On April 26, 1963, a meeting was held at Edge-wood to evaluate the group’s toxicity research and to"reach~ a conclusion about dose levels and hazardsto health of men and domestic animals from 2,4-Dand 2,4,5-T." Pet. App. 35a (citation and quotationmarks omitted). As the court of appeals noted,"[t]hose in attendance included officials from variousbranches of the military and various other govern-ment agencies, and representatives from manufac-turers Dow Chemical and AmChem Products." Ibid.The participants were presented with all of the in-formation that had been amassed by the military’sresearch team, as well as the toxicity data possessedby the manufacturers who were present. Ibid.Based upon all of this information, the Edgewoodtask force concluded that "no health hazard is or wasinvolved to man or domestic animals from theamounts or manner [in which] these materials wereused *** " Id. at 35a-36a (quoting A2370) (emphasisadded).

Edgewood reported its results to the President’sScience Advisory Committee ("PSAC"). A1620,A1567. At an April 1963 briefing, PSAC was pre-

8

sented with the data amassed at Edgewood Arsenal,as well as the Edgewood team’s conclusion that thedefoliation strategy was reasonably safe. Pet. App.35a; A2385, A1891-92. It is undisputed that variousPSAC members knew throughout the period whenAgent Orange was being used in Vietnam that dioxinwas a contaminant in Agent Orange. Pet. App. l16a,118a; A1716-17, A1816-19, A1834-35, A2107-09.

Petitioners offer no evidence to contradict theSecond Circuit’s conclusion that "[t]he governmentexamined the toxicity of what the plaintiffs contendwas the most toxic Agent Orange variant used inVietnam - Agent Purple - and determined that itposed no unacceptable hazard." Pet. App. 35a; seealso id. at 115a. Indeed, petitioners do not mentionEdgewood or PSAC at all.

3. The Government’s Efforts to IncreaseProduction of Agent Orange

By the mid-1960s, the chemical companies’ lim-ited manufacturing capacity precluded them fromsatisfying the military’s increasing need for largeamounts of Agent Orange. The ensuing shortfallsbecame a matter of concern at the highest levels ofthe government. As a result, the government estab-lished a system of "rated orders," which required themanufacturers to fill government orders prior tothose of other customers, on penalty of a fine or im-prisonment. Pet. App. 11a. In 1966, when a short-age of Agent Orange developed despite the use ofrated orders, military commanders on the ground inVietnam warned that the "failure to obtain neededsupplies would cause an unacceptable impact onmilitary operations." Id. at 110a. In March 1967,the government took the exceptional step of shiftingprocurement to an "emergency basis," A377-80,

9

A2205, and requiring several of the manufacturers tosell their entire output of 2,4,5-T to the military.Pet. App. l13a. As a Commerce Department officialnoted, "this was the first time the entire productionof a chemical had been taken by the military."A1325.

Late in 1966, the government took another majorstep to address the shortage of Agent Orange: itstarted planning for construction of a military herbi-cide manufacturing facility in Weldon Spring, Mis-souri. Pet. App. 110a. Although the project was ul-timately cancelled, during the planning stages thegovernment acquired even more knowledge regard-ing techniques used to manufacture 2,4,5-T and therelated issues of dioxin contamination, chloracne,and liver damage. A1597-98, A2444, A2451. Muchof that information came directly from the manufac-turers. For example, government officials visited aMonsanto plant and learned of the chloracne prob-lem. A1597-98. Dow sent a letter to Edgewood’sDeputy Director of Procurement warning of a "seri-ous potential health hazard to production workers,"noting the availability of "methods to detect" dioxincontent, and a process that had been developed byGerman chemical manufacturer C.H. Boehringer toreduce (though not completely eliminate) dioxin lev-els. A485. Petitioners now rely heavily on the Boe-hringer process to suggest that defendants failed toadopt state-of-the-art methods. Pet. 5, 18-19. Infact, however, Dow offered to consider making thisparticular "knowhow" available for the government’suse at Weldon Spring (Pet. App. 47a), but the gov-ernment expressed no interest.

10

4. The Success of the Defoliation Program

The record makes clear that the military vieweddefoliation as a critically important program. As oneDefense Department official put it:

We were losing a lot of people from the mostincredibly clever and insidious mecl~anisms.Men walking down trails with heavy foliageall around would be shot at close range bypeople whom they couldn’t see. We had air-craft overhead who simply could not see thetrails below them, so we had a lot of forces,and yet they were terribly vulnerabl[e to justa few people hidden in the jungle growth.

In that situation, the overriding interestwas to see whether or not the science andtechnology that was available could be ap-plied to get rid of some of this cover.

A1673-74.

Moreover, the program was a success. GeneralWilliam Westmoreland, the commander of Americanforces in Vietnam from 1964 to 1968, testified thatAgent Orange fully met expectations - it enabled themilitary to "accomplish our military mission" in "arather unique battlefield environment." A2096-98.The courts below agreed:

The use of Agent Orange in Vietnam wasbelieved necessary to deny enemy forces thebenefits of jungle concealment alo~Lg trans-portation and power lines and near friendlybase areas. Its success as a herbici,de savedmany, perhaps thousands of, lives.

In re "Agent Orange", 818 F.2d at 192-.93; see alsoPet. App. 158a ("It is fair *** to note once again that

11

the use of Agent Orange and other herbicides to clearfoliage during the Vietnam War prevented manymore American and allied casualties than could pos-sibly be attributed to exposure to such herbicides.").

B. Litigation History

Petitioners are the fourth wave of plaintiffs toclaim injury as a result of exposure to Agent Orange.The first set of cases was filed in the late 1970s. TheUnited States District Court for the Eastern Districtof New York certified a class that, after years of dis-covery, settled with defendants for $180 million plusinterest. The settlement funds were distributed from1987 through 1997 to the "291,000 class memberswho filed claims prior to the 1994 cutoff date." Pet.App. 14a. Both the district court (In re "Agent Or-ange"Prod. Liab. Litig., 597 F. Supp. at 857) and theSecond Circuit (In re "Agent Orange" Prod. Liab.Litig., 818 F.2d 145, 149 (1987)) affirmed the fairnessof the settlement. The court of appeals outlined"various weaknesses of plaintiffs’ case," id. at 171,that supported the court’s ’l~elie[f] *** that the[plaintiffs’ lawyers] had good reason to view this caseas having only nuisance value," ibid., including thegovernment contractor defense, which the courtviewed as an "impossible[] hurdle to surmount." Id.at 173.5

A second group of plaintiffs opted out of the classprior to settlement. As to that group, the SecondCircuit affirmed summary judgment on the basis of

~ The Second Circuit further concluded that the plaintiffs faced"substantial" problems in proving causation and that "the clearweight of scientific evidence casts grave doubt on the capacity ofAgent Orange to injure human beings." 818 F.2d at 149, 172.

12

the government contractor defense. See In re "AgentOrange"Prod. Liab. Litig., 818 F.2d at 193.

A third group of plaintiffs, consisting of veteranswho manifested injury after the 1984 settlement,filed suit in the late 1980s. The Second Circuit foundthose plaintiffs to be bound by the sett][ement. SeeIvy v. Diamond Shamrock Chems. Co., 996 F.2d1425, 1428-29 (1993). The court also reaffirmed thefairness of the modest settlement because "seriousobstacles to recovery remain," most importantly thegovernment contractor defense. Id. at 1436.

The current petitioners are a group of plaintiffswhose claimed injuries allegedly did not manifestuntil after the 1984 settlement funds were ex-hausted.~ The Second Circuit held that such indi-viduals are not bound by the settlement, Stephensonv. Dow Chem. Co., 273 F.3d 249, 261 (2,003); its rul-ing was affirmed by an equally divided Court. SeeDow Chem. Co. v. Stephenson, 539 U.S. 1.11 (2003).

On remand, the district court held that the gov-ernment contractor defense bars Agent Orangeproduct liability claims by these plaintiffs (Pet. App.150a-52a), just as it did claims by every other groupof plaintiffs.

C. The Decision Below

The Second Circuit affirmed, finding that the de-fendants had satisfied all three prongs, of the gov-ernment contractor defense. Pet. App. 10a.

6 As of June 30, 1997, the funds generated by the 1984 settle-

ment were completely distributed or committed for the benefitof the class. See Pet. App. 100a-01a (describing distribution of$330 million).

13

Reasonably precise specifications. The court ofappeals found that "[t]he government approvedspecifications for a uniquely tailored product" (Pet.App. 24a), noting that "[t]he government was plainlythe ’agentH of decision’ with respect to Agent Or-ange’s contractually specified composition." Id. at29a (citations and quotation marks omitted). Thecourt rejected the plaintiffs’ argument that becausethe specifications did not mention dioxin, the gov-ernment "exercised no discretionary authority overthat which is the subject of their state tort litiga-tions." Id. at 24a. "Agent Orange was allegedly de-fective because it contained excessive trace amountsof dioxin, which were present as a result of themanufacture of a specified Agent Orange component,2,4,5-T. *** It was therefore the 2,4,5-T that was al-leged to be defective, not the dioxin." Ibid.

The court further held that "It]he governmentmade a discretionary determination regarding AgentOrange’s toxicity" that "create[s] the type of conflictbetween tort law and government interests contem-plated by Boyle." Pet. App. 29a, 30a. "Weare tasked *** with determining whether the gov-ernment’s discretionary actions with respect to theallegedly defective design and the alleged state lawduty conflict. If they do, the first Boyle requirementis met; if they do not, the government contractor de-fense does not apply ***." Id. at 30a (emphasis omit-ted).

The court started from the premise that the gov-ernment’s decision to order a particular product"with knowledge that the product has an arguabledefect" constitutes approval of ’"reasonably precisespecifications’ for that product, with the known de-fect, for purposes of the first Boyle requirement."

14

Pet. App. 34a (citing Lewis v. Babcock Indus., Inc.,985 F.2d 83, 89 (2d Cir. 1993)). Reviewing the fac-tual record, the court determined that in this case,

the Army examined the toxicology dataavailable to it and concluded that Agent Or-ange’s components, [2,4-D and 2,4,5-T] - inthe formulation that the government, in itsdiscretion, used when ordering it, and as itwas then being manufactured - posed "nohealth hazard" and were, at least under thecircumstances of international armed con-flict, suitable for use in Southeast Asia.Since the government continued 1~o orderAgent Orange after having evaluated its tox-icity levels and declared them acceptable, wecannot second-guess the manufacturers’ deci-sion to produce the agents in the mannerthat they did.

Id. at 35a, 36a (citation and quotation marks omit-ted).

In discussing the conflict between federal andstate interests, the court of appeals emphasized theparticularly important role of the government con-tractor defense in this context, where the military’spower to design and implement a wartime strategy isat stake.

The government’s "uniquely federal inter-est," [Boyle, 487 U.S.] at 504, in fully takingadvantage of its ability to determine whatlevel of risks and dangers must be toleratedin order to achieve a particular military goalneed not be belabored. *** We pause only tonote that the federal interest implicated bythe lawsuits here is not only the ordinary

15

need to ensure the government’s "work" gets"done," Boyle, 487 U.S. at 505, but the abilityto pursue American military objectives - inthis case, protection of American troopsagainst hostile fire.

Pet. App. 38a-39a. See also In re Agent Orange Prod.Liab. Litig., 818 F.2d at 192 ("Agent Orange was aproduct whose use required a balancing of the risk tofriendly personnel against potential military advan-tage. That balancing was the exclusive responsibil-ity of military professionals and their civilian superi-ors."); Pet. App. 122a ("The United States armedforces accepted the dangers it was aware of because,from a military point of view, the benefits in poten-tial savings of the lives of members of our armedforces and those of our allies outweighed the possiblerisks.’).

Compliance with specifications. The court notedthat "[t]he plaintiffs’ challenge to the defendants’ability to demonstrate the second requirement forBoyle protection - compliance with the contracts’specifications - does not warrant extensive discus-sion." Pet. App. 39a. Because the manufacturers in-disputably delivered Agent Orange with 2,4,5-T "pre-sent in *** the proportions and purity levels calledfor by the terms of the contracts," the court found thesecond prong satisfied as a matter of law. Id. at 39a-40a. Petitioners do not address Boyle’s second re-quirement.

Disclosure of hazards known to the contractor butnot to the government. As to Boyle’s third require-ment - that the manufacturer warn the Governmentof "known risks" - the court of appeals stated that"[t]he record is clear *** that the defendants did notfail to inform the government of known dan-

16

gets ~ of the type that would have had an impacton the military’s discretionary decision regardingAgent Orange." Pet. App. 41a.

Virtually all of the documents cited by the plain-tiffs for the proposition that the manufacturers failedto warn the government related to "the risk ofchloracne (a severe skin disease) and liiver damage[porphyria] to workers manufacturing Agent Or-ange." Pet. App. 43a. These risks ass,~ciated withthe mant~facture of Agent Orange were iirrelevant tothe military, which was concerned only about "thelikely effect on those exposed to the herbicides in themanner in which they were, and were to be, used inVietnam," and which concluded that "operational useof Agent Orange posed ’no health hazard ~ to menor domestic animals.’" _~. at 46a. Accordingly, moreextensive disclosure of the risks associaI~ed with the2,4,5-T manufacturing process would not have af-fected the government’s analysis. ~. at 47a."[N]othing in the record of which we are aware wouldcreate a triable issue of fact as to whether there wasnever-disclosed knowledge of a sort that might haveinfluenced the government’s decisionmaking processregarding Agent Orange as it was used in Vietnam."I~. at 48a.

REASONS FOR DENYING CERTIORARI

This case presents an exceptionally stark exam-ple of the "trade-off between greater safety andgreater combat effectiveness" that this Court de-scribed in ~oy~e. It is undisputed that neither thegovernment nor the contractors knew in the 1960sthat exposure to Agent Orange as it was used inVietnam would pose any risk of long-term illness.Pet. App. 46a. The government, which l~,ossessed farmore information than the contractors did about the

17

way in which the product would be used and the at-tendant risks, studied the potential toxicity of AgentOrange and concluded that the risks to humanhealth were both minimal and outweighed by mili-tary necessity. Id. at 35a-36a. That analysis is pre-cisely the sort of ’%alancing of many technical, mili-tary, and even social considerations," that this Courtheld would warrant protecting manufacturers fromstate liability. Boyle, 487 U.S. at 511.

The courts below applied a well-established legalstandard to a unique and complex set of facts that isdocumented by a "massive" record, and arrived at aresult that is entirely consistent with Boyle and withthe fundamental purpose of the government contrac-tor defense. Pet. App. 10a. Both Judge Weinstein,who has been involved in every stage of this casesince before the 1984 settlement, and the SecondCircuit, which has heard numerous appeals of AgentOrange cases, have found that defendants are enti-tled to summary judgment. The other lower courtsare in accord: the courts of appeals for the Fifth andFederal Circuits have likewise held that the govern-ment contractor defense protects the companies thatmanufactured Agent Orange for use in Vietnam.

Petitioners are unable to identify any legal errorin this unanimous conclusion. And their attempts tomanufacture conflict among the lower courts rest onmischaracterizations of both the decision below andthe other cases they cite. Petitioners’ policy argu-ments fare no better: they offer no reason to concludethat government contractors should be subject toendless litigation and potential liability for specula-tive risks that the government considered and ac-cepted. Further review by this Court is unwar-ranted.

18

I. THE DECISION BELOW NEITHER CRE-ATES NOR DEEPENS A CIRCUI~ SPLIT.

Petitioners’ attempt to construct conflict amongthe lower courts falls flat. This case presents theunusual situation in which three different courts ofappeals - the Second (on three separate occasions,see pp. 11-12 supra), Fifth, and Federal Circuits -have applied the same legal standard to the samefact pattern and reached the same co~Lclusion. InMiller v. Diamond Shamrock Co., the Fifth Circuitdismissed Agent Orange claims brought by civilianDefense Department employees. 275 F..3d 414, 419(2001). And the Federal Circuit die, missed twomanufacturers’ claims for indemnification of theirshare of the settlement, holding that "there can be noserious doubt that had the class action Agent Orangelitigation proceeded to termination, no liability wouldhave been imposed" because of the government con-tractor defense. Hercules Inc. v. United States, 24F.3d 188, 200 (Fed. Cir. 1994), affd on ot]~er grounds,516 U.S. 417 (1996).

Petitioners largely ignore those decis~ions and in-stead discuss a series of cases in which courts haveapplied Boyle to fact patterns totally unli[ke that pre-sented here. Specifically, none of the cases cited bypetitioners involved:

¯ Independent government studies of productrisks;

¯ A government decision to deploy the productin a manner that would increa~,~e any risksassociated with its use;

¯ "Rated" contracts under the Defense Produc-tion Act, a procurement system that nolonger exists; or

19

¯ Chemical exposures that allegedly producedlong-term risks of which no one was aware atthe time of contracting (and that are highlyquestionable even today).

More importantly, all of the courts applied thelegal standard set forth in Boyle in the same way asthe Second Circuit here. Review in this case wouldamount to no more than the application of settledlaw to a unique and non-recurring fact pattern.

A. There Is No Conflict Among The LowerCourts Concerning The Application OfThe Defense To Defects Arising DuringThe Manufacturing Process.

Petitioners’ first argument is that the defect theyallege is a manufacturing defect, not a design defect,because the presence of dioxin in Agent Orange re-sulted from the manufacturing process. They con-tend that the circuits are divided as to whether thegovernment contractor defense applies to "defectsarising out of the ’manufacturing’ process ratherthan from a product’s contractually specified ’de-sign."’ Pet. 18. This strained effort to demonstrate arelevant conflict in the lower courts cannot with-stand even cursory examination.

1. The Second Circuit rejected the plaintiffs’ at-tempt to recast their design defect claims as manu-facturing defect claims.

The plaintiffs at times refer to the defen-dants’ failure to use the Boehringer processas resulting in a "manufacturing" defect. Notso. The plaintiffs allege a defective process,not that the process used was somehow erro-neously applied.

2O

Pet. App. 58a n.15. And the court fo~.nd that theplaintiffs’ actual manufacturing defect claims hadbeen waived: "Because the plaintiffs’ briefs make noarguments regarding the district court’s, findings asto their failure-to-warn or manufacturing defectclaims, we deem these claims to have been aban-doned." Id. at 56a n.9. Review of a manufacturingdefect claim that was neither raised nor’ decided be-low is, of course, not warranted. See, e.g., Delta Air-lines, Inc. v. August, 450 U.S. 346, 362 (1981) ("ques-tion presented in petition but not raised in court ofappeals is not properly before us").

2. The circuits are not divided on the issue thatpetitioners claim is presented here. Peti.tioners sim-ply misdescribe the cases. In none of the decisionsthey cite did any court adopt the rule that petitionerspropose: that the government contractor defense isinapplicable to a defect if it arises during manufac-turing. Petitioners rely on an apparent disagree-ment between the Fifth Circuit and the EleventhCircuit over the meaning of the term "manufacturingdefect"- a purely semantic debate that has not pro-duced conflicting outcomes.

The Eleventh Circuit held in Harduvel v. GeneralDynamics Corp., 878 F.2d 1311 (11th Cir. 1989), that"[i]f a defect is one inherent in the product or systemthat the government has approved, it will1 be coveredby the defense. Where a defect is merely an instanceof shoddy workmanship, it implicates no federal in-terest." Id. at 1317. A claim of "shoddy workman-ship" essentially presents the same issues as the sec-ond prong of Boyle: the failure of the ite:m to complywith government specifications. Id. at 1321 ("To saythat a product failed to conform to specifications isjust another way of saying that it was defectively

21

manufactured.").7 The Harduvel court also statedthat the "distinction between ’aberrational’ defectsand defects occurring throughout an entire line ofproducts is frequently used in tort law to separatedefects of manufacture from those of design." Id. at1317.

Petitioners contend that Harduvel is in conflictwith the Fifth Circuit’s decision in Mitchell v. LoneStar Ammunition, Inc., 913 F.2d 242, 246, 248 (5thCir. 1990). In a footnote, Mitchell criticized theEleventh Circuit’s indication that "manufacturingdefects consist only of aberrational defects ~**. Onecan certainly conceive of situations in which a manu-facturer’s shoddy workmanship - neither approvednor authorized by the Government - produces a de-fect that occurs throughout an entire line of prod-ucts. *** In such situations, no federal interestwould support the extension of the government con-tractor defense." Id. at 247 n.10.

This supposed "split" in the circuits is a purelysemantic disagreement. The fundamental holding ofboth Harduvel and Mitchell is that a defect that re-sults from "shoddy workmanship" and is "neither ap-proved nor authorized by the Government" is notprotected by the government contractor defense.Harduvel, 878 F.2d at 1317; Mitchell, 913 F.2d at247 n.10. If shoddy workmanship affects the entireline of products, it would be termed a design defectunder Harduvel and a manufacturing defect underMitchell, but neither court would hold that such a de-

7 See also Zinck v. ITT Corp., 690 F. Supp. 1331, 1338

(S.D.N.Y. 1988) ("For the same reasons that ITT satisfied thesecond prong of the government contractor defense, plaintiffscannot prevail on their claim of manufacturing defect.").

22

fect is protected by the defense. Indeed, in a latercase the Fifth Circuit specifically stated that "[w]eagree with the Eleventh Circuit [in Harduvel] thatwhether the defense will apply cannot be determinedby the label attached to the claim," but rather "de-pends only on whether Boyle’s three conditions aremet *** " Bailey v. McDonnell Douglas Corp., 989F.2d 794, 801-02 (5th Cir. 1993) (emphasis in origi-nal). The Ninth Circuit decision cited in the petitionfollowed the same rule. See Snell v. Bell HelicopterTextron, Inc., 107 F.3d 744, 749 (9th Cir. 1997)("whether the defense applies to a claim based on analleged manufacturing defect depends on whetherthe particular product at issue was manufactured inconformity with reasonably precise specifications ap-proved by the government"),s

3. In any event, all of the decisions cited by thepetitioners are in accord with the opinion below. TheSecond Circuit correctly found that the government

s Petitioners also rely on dictum in a dissenting opinion in Car-

ley v. Wheeled Coach, 991 F.2d 1117 (3d Cir. 1993), withoutidentifying it as either dictum or a dissent. See Pet. 22. InCarley, the issue was whether the government contractor de-fense is available to nonmilitary contractors. The majority heldthat it is, as a matter of federal common law, because otherwisethe contractors’ "increased financial burden~,~ would passthrough to the government." 991 F.2d at 1122. Dissentingfrom that conclusion, Judge Becker noted that "since liabilityfor manufacturing defects is not shielded by the governmentcontractor defense, the argument that the purpose of the de-fense is to prevent the passing of liability costs on to the gov-ernment carries little weight." Id. at 1132 (Becker, J., dissent-ing). That observation, in which "manufacturing defect" ap-pears to be shorthand for an instance of shoddy workmanshipthat is neither intended nor approved by the gow~rnment, is notin conflict with Harduvel, Mitchell, or the decision below.

23

analyzed the toxicity of 2,4,-D and 2,4,5-T as theywere manufactured by the defendants and made aninformed decision that Agent Orange did not pose arisk to military personnel or others who might be ex-posed to it that outweighed the benefits of the prod-uct. Pet. App. 36a ("Since the government continuedto order Agent Orange after having evaluated its tox-icity levels and declared them acceptable, we cannotsecond-guess the manufacturers’ decision to producethe agents in the manner that they did."); id. at 35a(noting that Army evaluated and approved AgentOrange "as it was then being manufactured"). The"alleged design defect (toxic 2,4,5-T)" (id. at 35a),therefore, was "inherent in the product or systemthat the government has approved" (Harduvel, 878F.2d at 1317) and would be protected by the defenseunder Harduvel, Mitchell, and all the other casescited in the petition.

And even the linguistic quibble between Hardu-vel and Mitchell is not implicated here, because bothcases use the term "manufacturing defect" to de-scribe instances of "shoddy workmanship," ratherthan - as petitioners would have it - all defects thatarise during the manufacturing process. Accord-ingly, the defect alleged by petitioners would not beconsidered a "manufacturing defect" under eithercase, or any other decision of which we are aware.This Court’s review is not warranted.

I~. The Lower Courts Are In AgreementRegarding Application Of The FirstBoyle Prong.

Petitioners next contend that the circuits are di-vided as to the level of detail and government over-sight required to satisfy Boyle’s first-prong require-ment of "reasonably precise specifications." They

24

contend that the Second Circuit allowed, the defenseeven though the defect was "never considered by anycontracting government officer," Pet. 25, whereasother circuits require either "exhaustively detailedspecifications" or "continuous back and forth" be-tween manufacturer and government. Id. at 24. Pe-titioners mischaracterize both the decision below andthe law in other circuits.

1. Petitioners’ discussion of the ruling below ishighly misleading. Far from finding that "the designfeature in question" was "never considered by anycontracting government officer," Pet. 25, the SecondCircuit determined that "the record discloses that thegovernment explicitly evaluated the ali!eged designdefect (toxic 2,4,5-T), and thereafter con~inued to or-der ’replacement’ herbicides." Pet. App. 35a (empha-sis added). Petitioners’ use of the term "contractinggovernment officer," rather than "Government offi-cer"- the phrase used in Boyle, see 487 U.S. at 512 -is designed to shift the Court’s focus toward low-levelcontract specialists and away from high-level poli-cymakers; but it is the latter who indisputablyevaluated the potential toxicity of Agent Orange andweighed it against urgent military needs, i.e., whoexercised governmental discretion. The defense isintended to protect discretionary government deci-sions; it makes no sense to exclude decisiions becausethey were made at higher levels of government.

Nor did the Second Circuit hold that the govern-ment’s decision to reorder a product "retroactivelyconstitutes approval of every possible ’design featurein question."’ Pet. 25 (quoting Pet. App. 34a).Rather, the court of appeals held that "reordering thesame product with knowledge of its relevant defectsplays the identical role in the defense as. listing spe-

25

cific ingredients, processes, or the like." Pet. App.37a-38a (emphasis added). Such a decision demon-strates that the "federal policies and interests andthe exercise of federal discretion" at issue are "con-trary [to] state law." Id. at 38a (emphasis added).That is a straightforward application of Boyle’s re-quirement that "the design feature in question [be]considered by a Government officer, and not merelyby the contractor itself." 487 U.S. at 512.9

Finally, petitioners ignore the fact that the courtof appeals required defendants to show that the gov-ernment "independently and meaningfully re-view[ed] the specifications such that the governmentremain[ed] the agent of decision." Pet. App. 28a (ci-tation and quotation marks omitted). The court citeda raft of documents in support of its conclusion that"based on the evidence in the extensive record *** noreasonable jury could find that the government didnot exercise sufficient discretion" over the specifica-tions for Agent Orange. Id. at 29a. Indeed, the courtcited Harduvel for the proposition that a "continuousback and forth" between contractor and governmentis sufficient to satisfy Boyle’s first prong (id. at 28a)and found that the record in this case demonstratedjust such a dialogue. Id. at 28a-29a (citing evidencethat on multiple occasions the government rejectedthe contractors’ suggestions of particular ingredients,tests, and purity levels).

9 Relatedly, the Second Circuit did not hold that "any safety

and health testing, no matter now imprecise or ineffective, issufficient to satisfy the requirement of reasonably precise speci-fications, even for an otherwise totally imprecise contract." Pet.28. Rather, the court discussed in detail the extensive toxicitytesting conducted by the government. Pet. App. 35a-36a.

26

2. Contrary to petitioners’ assertion, the law inother circuits is entirely consistent with the SecondCircuit’s approach below. In Snell, for example, theNinth Circuit held that Boyle’s first prong requiresan "exercise of judgment by the government in thedesign of the particular feature at issue." 107 F.3dat 747. The Snell defendant was not entitled to sum-mary judgment because the record "[did] not estab-lish as a matter of law that the government exercisedits discretion with respect to the [alleged~ly defective]drive shaft and its components." Id. at 748.

The Fifth Circuit’s decision in Trevino v. GeneralDynamics Corp., 865 F.2d 1474 (5th Cir.. 1989), like-wise focused on whether the government had exer-cised a discretionary decision, not on formalistic testsdealing with the precise contract requirements or thedegree of contractor-government interaction. "Whenthe government merely accepts, withol~t any sub-stantive review or evaluation, decisions made by agovernment contractor, then the contractor, not thegovernment, is exercising discretion. A rubberstamp is not a discretionary function; therefore, arubber stamp is not ’approval’ under Boyle." Id. at1480. Because "the record clearly show[ed]" that thecontracts "left design entirely to the discretion of’ thecontractor," the defense was unavailable. Id. at1486-87 (citations and quotation marks omitted).Here, by contrast, the precise design of Agent Orangewas selected by the government.

Finally, in Kleemann v. McDonnell DouglasCorp., the Fourth Circuit found the defense satisfied.While the court stated that "active government over-sight is relevant to all three elements," it did nothold that a "continuous exchange" is recluired. See890 F.2d 698, 701, 702 (1989).

27

All of these decisions, like the decision below, in-volved applications of widely agreed-upon legal prin-ciples to particular facts. They do not reflect anydoctrinal split regarding the nature of the defense.

C. The Circuits Are Also In Agreement Re-garding Application Of The Third BoyleProng.

There is likewise no conflict concerning the thirdBoyle prong, This Court recognized in Boyle thatprotection from product liability could create a per-verse "incentive for the manufacturer to withholdknowledge of risks." 487 U.S. at 512. Accordingly, itheld that the defense applies only when "the supplierwarned the United States about the dangers in theuse of the equipment that were known to the sup-plier but not to the United States." Ibid. The warn-ing requirement is not boundless. It is designed todeter the intentional withholding of material infor-mation - not to allow plaintiffs, decades later, tothwart the defense by pointing to non-disclosures ofirrelevant or immaterial risks.

1. The Second Circuit Correctly Held ThatThe Contractor’s Duty Is To Inform TheGovernment Of Risks That Are MaterialTo The Exercise Of Governmental Discre-tion.

The Second Circuit held, uncontroversially, thatthe contractor must warn only of risks "of the typethat would have had an impact on the military’s dis-cretionary decision *** Boyle did not contemplaterequiring disclosure of any and all potential risks bythe contractor to the government, irrespective oftheir relation to the governmental discretionary de-cision at issue." Pet. App. 41a-42a. The court noted

28

that "the undisputed record *** is that during theentirety of the production of Agent ,Orange, themanufacturers knew only that it was possible thatthose handling herbicides containing 2..,4,5-T mightdevelop the skin disease chloracne." Id. at 46a. Thatrisk, the court found, would have had r.Lo impact onthe government’s exercise of discretion:

We conclude *** that no reasonable fact-finder could find that the defendants hadknowledge of a danger that might have influ-enced the military’s conclusion thai; "opera-tional use" of Agent Orange posed "~Lo healthhazard to men or domestic animals," and itspresumably related decision to continue topurchase Agent Orange *** We find noth-ing in the record to support an asser~Lion thatthe defendants "cut off informatio~a highlyrelevant to discretionary decisions" of thegovernment, Boyle, 487 U.S. 513, ~i.e., thatthey possessed knowledge of dangers un-known to the government that, had tlhey beenshared, might have influenced the govern-ment’s decision ***

Id. at 47a (citations, brackets, ellipses, a~ad quotationmarks omitted).

Petitioners barely challenge this ruling on themerits. Nor can they; it is simply an a:pplication ofthe third prong, as set forth in Boyle, to the unusualfacts of this case. Boyle limits the warrdng require-ment in three pertinent ways. First, Boyle requireswarning only of "dangers in the use of the equip-ment," not of hazards that relate to the manufactur-ing process and do not threaten military personneland other individuals exposed to the end product.487 U.S. at 512 (emphasis added). This restriction is

29

consistent with the purpose of the third prong, whichis to ensure that the "effort to protect discretionaryfunctions [not] perversely impede them by cutting offinformation highly relevant to the discretionary deci-sion." Id. at 512-13 (emphasis added). The SecondCircuit emphasized the military’s focus on "the likelyeffect on those exposed to the herbicides in the man-ner in which they were, and were to be, used in Viet-nam," as distinct from "all the possible dangers asso-ciated with the manufacture of the chemical ***"Pet. App. 46a, 47a (emphases added). The court con-cluded that these manufacturing hazards would nothave "influenced the military’s conclusion that opera-tional use of Agent Orange" was adequately safe. Id.at 47a (emphasis added; citation and quotationmarks omitted).

Second, Boyle requires warning only of actual"dangers *** that were known to the supplier." 487U.S. at 512 (emphasis added). Petitioners have notasserted, nor can they, that the contractors knew inthe 1960s that exposure to Agent Orange risked anyof the long-term injuries that plaintiffs allege theysuffered.1° To the contrary, as the Second Circuit ob-served, the evidence that petitioners have cited forthe proposition that "the defendants knew of dioxin’shazards *** pertain[s] almost universally to the riskof chloracne and liver damage to workers manufac-turing Agent Orange." Pet. App. 43a (emphasisadded).

Third, and conversely, the warning requirementis limited to "dangers *** not [known] to the United

10 That an isolated employee may have speculated about possi-

ble dangers that were never substantiated is plainly insufficientto support such a contention. See Pet. 14.

3O

States." Boyle, 487 U.S. at 512 (emphasiis added). Itis undisputed that the only testing relevant to thelong-term health effects of which petitioners com-plain was conducted, not by the manufacturers, butby the government. A129-279.

2. There Is No Conflict Among The LowerCourts On This Question.

Petitioners assert that the Second ~ircuit’s ap-plication of Boyle’s third requirement conflicts withthe approach taken by the Third Circu![t in Carley.To the contrary, Carley focused on precisely thoserisks that were relevant and material to the govern-ment’s assessment of the alleged defect. The plain-tiff contended that the defendant’s ambulance "wasunreasonably prone to turn over duri~ag intendeduse because of an excessively high center of gravity."991 F.2d at 1118. The court of appeals held that thedefendant had failed to satisfy the third prong of thegovernment contractor defense because

the record [was] devoid of communicationsbetween [the defendant] and the GSA per-taining to the risks of high centers of gravity.Nor is there any other competent ,evidenceindicating that the government knew thatthe height of the ambulance’s center of grav-ity might give the vehicle a dangerous pro-pensity to rollover.

Id. at 1127. The Third Circuit did not suggest thatthe alleged nondisclosure of immaterial or irrelevantrisks would bar the defense.

Similarly, none of the other decisions that peti-tioners cite (Pet. 31) - Ramey v. Martin-Baker Air-craft Co., 874 F.2d 946 (4th Cir. 1989); S~out v. Borg-Warner Corp., 933 F.2d 331 (5th Cir. 1991); or Har-

31

duvel - involved an alleged failure to warn of an im-material risk, and none suggests that the contractorwould fail the third prong in such a case. Indeed, allof those decisions found the defense to be satisfied.There simply is no conflict among the lower courts onthis issue.

3. Petitioners’ Policy Concerns Are Mis-placed And Do Not Warrant This Court’sReview.

Petitioners conclude with a plea for a disclosurerequirement substantially broader than what thisCourt established in Boyle. Petitioners propose thatcontractors should lose the benefit of the defense ifthey fail to disclose information that is neither rele-vant to the government’s contracting decision nor re-lated to the harm that plaintiffs claim decades later.Such a requirement would make the availability ofthe defense a matter of chance, hampering the gov-ernment’s ability to obtain the products that it needs,while doing little to make those products safer.Moreover, their farfetched hypotheticals involvingbait-and-switch schemes and active concealment ofknown hazards in the use of military equipment, Pet.32-33, bear no resemblance to this case, in which pe-titioners have alleged, at most, a failure to disclosepurely occupational hazards of no relevance to themilitary.

Petitioners assert that the Second Circuit’s rul-ing creates incentives for manufacturers to concealor withhold information about product risks from thegovernment. This argument ignores the court of ap-peals’ explicit determination that there was no evi-dence of such concealment here. Pet. App. 48a; seealso pp. 16, 28 supra. Petitioners ask this Court toadopt a rule that the defense is not available unless

32

the contractor disclosed all risks - no matter howimmaterial to the government’s decisionmakingprocess or to the harm that plaintif£,~ ultimatelyclaim. Such a rule would serve no purpose andwould be antithetical to the purposes of tlhe defense.

Petitioners’ assertion that the Second Circuit’sruling will encourage non-disclosure is nonsensical.As this Court observed in Boyle, a contractor mighthave an incentive to conceal risks if "conveying thatknowledge might disrupt the contract." Boyle, 487U.S. at 512. In other words, the contract;or would betempted to conceal only those risks that are materialto the government’s decision. The Second Circuitwould deny the defense to any contractor who suc-cumbed to that temptation.

On the other hand, denying the defense for fail-ure to disclose immaterial risks would be counter-productive. The Second Circuit recognized that re-quiring contractors to flood the government with dis-closures, "irrespective of their relation to the gov-ernment discretionary decision at issue," would

overwhelm government decision makers withlargely irrelevant data, extending the timeand costs associated with federal contractingand obscuring those risks most likely to havean impact on contracting decisions. A rulethat required full disclosure of all possiblerisks to anyone would be contrary to Boyle’sunderlying rationale of protecting the federalinterest in "getting the Government’s workdone."

Pet. App. 42a-43a (emphases in original).

In this case, there is no evidence that wouldpermit the conclusion that the military would have

33

abandoned its efforts to protect American troops witha defoliation program, or chosen a less effectivechemical, if it had received a clearer warning aboutthe risk of chloracne or liver damage to productionworkers. Indeed, there is substantial direct evidencethat the government considered that risk irrelevant.A2129-30. Nor is there any evidence to suggest thatthe government would have required the manufac-turers to employ a different production process,which plaintiffs argued would have been slower andmore expensive (see, e.g., Reply Br. in 05-1760-cv (2dCir.) at 2; Opening Br. in 05-1693-cv (2d Cir.) at 53-54), to protect against risks that were at most mat-ters of speculation. But it is not at all far-fetched tosuggest that, had the manufacturers anticipatedmassive class actions, they might have resisted de-mands to supply a government program in support ofan unpopular war.11

11 If certiorari is granted on the government contractor defense

issue, respondents will argue as an alternative ground for af-firmance that the current plaintiffs are bound by the 1984 classsettlement, Petitioners were allowed to proceed with theircases after this Court affirmed, by an equally-divided Court, theSecond Circuit’s ruling that plaintiffs were not bound by the1984 class settlement because they did not manifest injury untilafter the settlement funds were exhausted and consequentlyhad been inadequately represented at the time of the settle-ment. Dow Chem. Co., 539 U.S. 111. That decision is, ofcourse, without precedential effect. See Nell v. Biggers, 409U.S. 188 (1972).

34

CONCLUSION

The petition for a writ of certiorari should be de-nied.

Respectfully submitted.

CHARLES A. ROTHFELDMayer Brown LLP1909 K Street, NWWashington, D. C. 20006(202) 263-3000

JAMES V. A~OSARICHARD S. FELDMANRivkin Radler LLP926 RexCorp PlazaUniondale, NY 11556(516) 357-3000

ANDREW L. FREYCounsel of Record

LAUREN R. GO.LDMANCHRISTOPHER g. HOUPTMayer Brown LLP1675 BroadwayNew York, NY 10019(212) 506-2500

JAMES L. STENGELLAURIE STRAUCH WEISS

Orrick, Herrington &Sutcliffe LLP

666 Fifth AwmueNew York, NY 10103(212) 506-37’,75

Counsel for RespondentThe Dow Chemical Company

WILLIAM A. KROHLEY

WILLIAM C. HECK

Kelley Drye & WarrenLLP

101 Park AvenueNew York, NY 10178(212) 808-7800

Counsel for RespondentHercules Incorporated

MICHAEL Mo GORDON

McKee Nelson LLPOne Battery Park Plaza34th FloorNew York, NY 10004(917) 777-4567

Counsel for RespondentsOccidental Chemical Cor-poration, as successor bymerger to Diamond

LAWRENCE D’ALOISE, JR.Clark, Gagliardi &

MillerThe Inns of Court99 Court StreetWhite Plains, NY 10601(914) 946-8900

Counsel for RespondentsT.H. Agriculture & Nutri-tion Co., Inc., Thompson-Hayward Chemical Co.,and Harcros Chemicals,Inc.

35

Shamrock ChemicalsCompany; Maxus EnergyCorporation; Tierra Solu-tions, Inc., formerlyknown as Chemical LandHoldings, Inc.; and ValeroEnergy Corporation, assuccessor by merger to Ul-tramar Diamond Sham-rock Corporation

JOHN C. SABETTAANDREW T. HAHN, SR.

Seyfarth Shaw LLP620 Eighth AvenueNew York, NY 10018-

1405(212)218-5509

RICHARD P. BRESSLatham & Watkins555 Eleventh Street, NW,

Suite 1000Washington, D.C. 20004(202) 637-2137

SETH P. WAXMAN

PAUL R.Q. WOLFSON

MARY K. GARDNER

Wilmer Cutler PickeringHale and Dorr LLP

1875 Pennsylvania Ave.NW

Washington, D.C. 20006(202) 663-6000

JAMES E. TYRRELL, JR.

Patton Boggs LLPThe Legal CenterOne Riverfront Plaza -

6th FloorNewark, NJ 0 7102(973) 848-5620

Counsel for Respondent Monsanto Company

JANUARY 2009

36

MYRON KALISH50 East 79th StreetNew York, NY 10021

Counsel for RespondentsUniroyal, Inc.., UniroyalChemical Co., and CDUHoldings, Inc.