Ch 6: Product & Strict Liability

Product Liability:

Liability of manufacturers, distributors, wholesalers, retailers, lessors, and subcomponent manufactures for the injuries caused by defective products. 3 theories:

1. negligence

2. misrepresentation

3. strict liability.

Negligence

• plaintiff must prove that the defendant breached a duty of reasonable care in the design, manufacture, inspection, or labeling of the product, directly causing harm.

Misrepresentation (Fraud):

• Occurs when a seller intentionally misrepresents or conceals material facts about a product's safety or quality, and the buyer relies on that statement to their detriment.

Strict Liability in Tort:

• injured parties do not have to prove that the manufacturer was careless, only that the product was defective and unreasonably dangerous.

Privity of Contract:

• NOT Required. Strict liability applies even if injured party had no contractual relations with defendant (they didn’t buy product themselves)

Chain of Distribution:

• All commercial entities in the chain—including component manufacturers, final assemblers, wholesalers, distributors, and retailers—can be held jointly and severally liable.

Compensatory Damages:

• actual damages). Money recoverable from the defendant in a strict liability action. ex.) personal, property, economic damage

Punitive Damages:

• awarded to punish the defendant and set an example. Awarded if the court finds the defendant’s conduct was committed with intent or with reckless disregard for human life

Manufacturing Defect:

• Occurs when the manufacturer fails to 

  • 1.) assemble a product properly

  • 2.) test a product properly

  • 3.) check the quality of a product adequately

    • ex.) single vehicle brake line installed with missing bolts or compromised metal

Design Defect:

• when a product is designed incorrectly and could have been reasonably been designed to be safer

  • ex.) car model designed with a fuel tank positioned where rear impacts cause explosions

Crashworthiness doctrine:

• automobile manufacturers are under a duty to design automobile so they take into account possibility of harm from person’s body striking something inside the automobile in case of car accident

Failure to warn of a potential danger:

• Inadequate instructions or warning on the packaging on the product that could cause injury if the danger is unknown 

  • ex.) prescription drug packaging that omits known, severe drug-interaction risks

Packaging Defect:

• Packaging fails to withstand normal transit, fails to deter tampering, or is unsafe

  • ex.) Over-the-counter medicine lacking required tamper-evident seals

Failure to provide adequate instructions:

• Inadequate, vague, confusing, or incomplete directions on how to safely assemble, operate, or maintain the product

  • ex.) unassembled piece of heavy gym equipment or a power tool with instructions that omit critical setup or calibration steps, causing it to collapse during use

Risk-utility test

• Test requires the court to consider:

  • 1) gravity of danger

  • 2) likelihood that injury will occur

  • 3) social utility of the product

  • 4) the availability and cost of producing safer alternative design

  • 5) the ability of the user to avoid injury

• Basically, a cost-benefit analysis

• Usually requires the plaintiff to present proof of a feasible alternative design or warning

• Two-thirds of the states use this test

Consumer Expectation Test:

Test requires plaintiff to demonstrate:

• Whether the product is more dangerous than a reasonable consumer would expect

• Whether the consumer would be aware of the potential injury the product could cause

• Jury is asked to determine if the product’s design or warning performed safely

• One-third of the states use this test

Generally Known Damage:

• certain products are inherently dangerous and are known to the general population to be so.

Supervening Event:

• An alteration or modification made to the product after it left the manufacturer that significantly causes the injury.

Assumption of the Risk:

• The plaintiff knew and understood the specific danger posed by the defect and voluntarily exposed themselves to it.

Abnormal Misuse:

• The plaintiff used the product in an abnormal, unforeseeable manner (e.g., using a power drill to blend paint near an open flame). Unforeseeable misuse bars recovery, whereas foreseeable misuse requires warnings.

Reasonably Foreseeable Misuse:

• misuse of product that is foreseeable, and the product could easily and reasonably be designed to prevent injury from misuse

Government Contractor Defense:

• The manufacturer is immune if the product met precise government specifications and the manufacturer warned the government of known hazards.

Statute of Limitations - When the plaintiff suffers injury

• Requires an injured person to bring an action within a certain number of years from the time that the plaintiff was injured by a defective product. 

• If plaintiff does not bring the lawsuit in the allotted time, they lose the right to sue

Statute of Repose - When the product is first sold

• Limits a manufacturer’s, seller’s, and lessor’s liability to a certain number of years from the date when the product was first sold

• The period of repose varies from state to state.

Contributory Negligence:

• Persons who are partially responsible for causing their own injuries may not recover anything from the manufacturer or seller of a defective product.

Comparative Negligence:

Persons who are partially responsible for causing their own injuries are responsible for a proportional share of the damages. The manufacturer or seller of the defective product is responsible for the remain-der of the plaintiff’s damages.

Partial Comparative Negligence:

• Persons who are less than 50 percent responsible for causing their own injuries may recover damages under the doctrine of comparative negligence; if persons are 50 percent or more responsible for causing their own injuries, then the doctrine of contributory negligence applies, and the plaintiff recovers nothing.