Has anyone had this experience, or know what this caterpillar is?

I bought diablo in part for its insect and disease resistance, but oh well!

If it's taken a whole week to denude half the bush, they're working slowly. I wouldn't worry about it. Your Diablo is just fine.

If your infestation occurred in September, chances are good that your Physocarpus will survive and leaf out in spring. Make a note of when the infestation began, and next year when/if you see caterpillars, immediately apply the organic BT, (does not harm other beneficial insects, but will kill most caterpillars eating your physocarpus, so be sure to only put it on those leaves when you actually see caterpillars).

Several of my garden clients had this problem late this year in New England. It did not happen in my garden, but caterpillar infestations tend to go in cycles. You may not have a problem this year.

The caterpillars will eat many kinds of shrubs and tend to eat where the eggs are deposited and then move on.

In terms of identifying the caterpillars, I have some useful links on my blog/website under "Insects/Entomology" on the right side bar.

Hope this is helpful to you. Physocarpus is generally a very disease and insect resistant shrub - but nothing is 100% - especially with caterpillars. Late season attacks are rarely fatal, since the shrub had all season to photosynthesize.

Good luck!
Michaela