Joe Kennedy brought a wrongful death action against Southern California Edision Company (Cal Edison) and Combustion Engineering, Inc. for the death of his wife, Ellen Kennedy. Ellen Kennedy died in 1996 of chronic myelogenous leukemia (CML). From 1982 to 1990, Joe Kennedy worked for Cal Edison at the San Onofre Nuclear Generating Station (SONGS). Kennedy claimed that SONGS released microscopic particles of radioactive material, known as "fuel fleas," from defective nuclear fuel rods manufactured by Combustion Engineering. Kennedy claimed that these "fuel fleas" contained radiation in excess of the federally maximum allowable dosage and that Ellen Kennedy was exposed when Joe Kennedy inadvertently brought the "fuel fleas" home on his clothing and hair. Kennedy sued Cal Edison for the wrongful death of Ellen Kennedy, alleging negligence under the Price-Anderson Act,[1] and sued Combustion Engineering under products liability law for the allegedly defective production of the fuel rods.

In March 1997, the district court dismissed all products liability claims against Combustion Engineering after determining that it was not reasonably foreseeable that the "fuel fleas" from the defective fuel rods would injure Ellen Kennedy.[2] In August 1997, following the California Supreme Court's decision in Rutherford v. Owens-Illinois, Inc.,[3] Kennedy requested a Rutherford causation jury instruction, which the district court denied. In March 1998, the jury returned a verdict in favor of Cal Edison and Combustion Engineering. The district court denied Kennedy's motion for a new trial.[4] Kennedy appealed the district court's refusal to issue a Rutherford instruction and the dismissal of the product liability claims against Combustion Engineering.

In California, to satisfy legal causation for cases involving medical injuries with multiple possible causes, the plaintiff must show that a particular cause is a substantial factor in bringing about the harm.[5] In Rutherford, an asbestos products liability case, the California Supreme Court altered the plaintiff's causation burden because of the scientific uncertainties involved in proving causation in asbestos-related cancer.[6] The California Supreme Court incorporated this burden into a jury causation instruction: "[P]laintiff may meet the burden of proving that exposure to defendant's product was a substantial factor causing the illness by showing that in reasonable medical probability it was a substantial factor contributing to the plaintiff's . . . risk of developing cancer."[7] A plaintiff, therefore, is relieved of the burden of showing that a defendant's product was the one, or among the ones, that actually caused the formation of the cancerous growth.

The Ninth Circuit held that Rutherford was applicable to Kennedy's claim on two bases. First, the California Supreme Court has extended Rutherford to claims involving exposure to substances other than asbestos.[8] Second, the Ninth Circuit reasoned that Rutherford applies to "single-defendant hazardous substances cases where the defense of alternative possible causes is raised," because the plaintiff faces the same type of scientific causation difficulties encountered in cases of multiple alternate defendants.[9] Due to the "medical uncertainties surrounding the cause and effect relationship between CML and radiation" and the advancement of alternative causes of CML by the defendants, the Ninth Circuit determined that a Rutherford instruction should have been given to the jury.[10]

Although the jury instruction requested by Kennedy was improper because it omitted the "substantial factor" requirement, the Ninth Circuit held that the district court was obligated to correctly instruct the jury. The court explicitly decided to follow other circuits on this issue and announced the rule for the Ninth Circuit: "[W]hen the district court is presented with an applicable instruction that raises an important issue of law . . . it is not relieved from the responsibility of giving a proper instruction simply because the party making the request has proposed an instruction that does not completely comply with the relevant law."[11]

The Ninth Circuit also determined that the failure of the district court to give a proper Rutherford instruction was not harmless error. The basis for the jury verdict was unknown because a general form was used, so it was possible that the jury found for the defendants based upon the erroneous causation instruction. Also, Kennedy had produced enough evidence for a reasonable juror to find that "it was more probable than not that there was more than a negligible probability that Mrs. Kennedy's cancer was caused by radiation from SONGS."[12] Because it was possible for a reasonable jury to find for Kennedy if it had received the correct instruction, the Ninth Circuit concluded that refusing a Rutherford instruction was not harmless error.

Finally, the Ninth Circuit held that the district court erred in dismissing the product liability claims against Combustion Engineering. Strict liability is consistent with the Price-Anderson Act, so long as the claim does not allow the "plaintiff to recover . . . in a public liability action under the Act without first establishing that the defendant breached a federally imposed duty of care."[13] California law requires that to be held strictly liable for injuries resulting from a defective product, the manufacturer or distributor must have "placed the product on the market."[14] Combustion Engineering did cause its product to be "placed on the market" by selling the fuel rods. Combustion Engineering failed to qualify for the "isolated transaction" exception[15] to strict liability because, even though its market is small, it supplied thousands of fuel rods to SONGS and other nuclear plants.[16] California courts have not held that strict products liability does not apply to the sale of products into a limited market. Thus, the Ninth Circuit determined that Combustion Engineering was susceptible to strict liability for its fuel rods because it placed the fuel rods on the market.

The foreseeability of a plaintiff's injury is related to the market for which a product is produced. However, California has not "restricted the class of foreseeable plaintiffs to immediate consumers to whom the defective products are directly marketed."[17] The Ninth Circuit determined that the district court erred when it decided as a matter of law that Ellen Kennedy was not a foreseeable plaintiff. The question should have been left to the jury because under California strict liability law the foreseeability of a plaintiff is determined by the actual foreseeability of a plaintiff in a particular case, rather than through categorical distinctions as a matter of law. The Ninth Circuit reversed the decision of the district court and remanded for a new trial.[18]