Products Liability

Products liability is the area of law in which manufacturers, distributors, suppliers, retailers, and others who make products available to the public are held responsible for the injuries those products cause.  In the United States, the claims most commonly associated with product liability are negligence, strict liability, breach of warranty, and various consumer protection claims. The majority of product liability laws are determined at the state level and vary widely from state to state. Each type of product liability claim requires different elements to be proven to present a successful claim.

Products Liability & Negligence

A products liability claim is usually based on one or more of the following causes of action:

1. design defect,
2. manufacturing defect, or
3. a failure to warn.

The claims may succeed even when products were used incorrectly by the consumer, as long as the incorrect use was foreseeable by the manufacturer (or other party in the "supply chain").  In general, products liability claims are based not on negligence, but rather on strict liability. Under the theory of strict liability, a manufacturer is held liable regardless of whether it acted negligently. It allows recovery for an injured customer who might be in a difficult position to prove what a manufacturer did or did not do in its design or manufacturing process. It is presumed that a manufacturer with its deep pockets may be better situated to absorb the cost of liability and would consider such expense in setting price for its products.  Some legal commentators also consider claims of failure to warn to be based on negligence.  A basic negligence claim consists of proof of:

1. a duty owed,
2. a breach of that duty,
3. an injury, and
4. that the breach caused the plaintiff's injury.

Over time, negligence concepts have arisen to deal with certain specific situations, including negligence per se (using a manufacturer's violation of a law or regulation in place of proof of a duty and a breach) and res ipsa loquitur (an inference of negligence under certain conditions).

Products Liability & Strict Liability

Products liability claims are, in general, not based on negligence, but rather on a liability theory called strict liability.  Rather than focus on the behavior of the manufacturer (as in negligence), strict liability claims focus on the product itself. Under strict liability, the manufacturer is liable if the product is defective, even if the manufacturer was not negligent in making that product defective. Because strict liability is a harsh regime for a manufacturer, who is forced to pay for all injuries caused by his products, even if he is not at fault, strict liability is applied only to manufacturing defects (when a product varies from its intended design) and almost never applied to design and warning defects. The first case to openly discuss the application of strict liability to manufacturing defects involved an exploding Coca-Cola bottle (though the case actually upheld the plaintiff's res ipsa loquitur theory).

There is some confusion in judicial opinions as to whether strict liability is being applied in cases of design and warning defects. The courts may even state that they are applying strict liability. However, when the court proclaims to apply strict liability while determining product's defectiveness through the use of a consumer expectations test or risk-utility test, it is applying the negligence principles and not strict liability. Although the tests are not based on the conduct of the manufacturer, rather focusing on the product itself, they attempt to determine if the product's design or warning is reasonable. It is widely known that reasonableness is the staple of negligence, not strict liability.

History

In the 1940s and 1950s, many American courts decided that it was too harsh to require seriously injured consumer plaintiffs to prove negligence claims against manufacturers or retailers. To avoid having to deny such plaintiffs any relief, these courts began to look for facts in their cases which they could characterize as an express or implied warranty from the manufacturer to the consumer. Over time, the resulting legal fictions became increasingly strained.

Of the various U.S. states, California was the first to throw away the fiction of a warranty and to boldly assert the doctrine of strict liability in tort for defective products, in 1963 (under the guidance of then-Associate Justice Roger J. Traynor). See Greenman v. Yuba Power Products, 59 Cal. 2d 57 (1963).  The importance of Greenman cannot be overstated: in 1996, the Association of Trial Lawyers of America celebrated its 50th anniversary by polling tort lawyers and law professors on the top ten developments in tort law during the past half-century, and Greenman topped the list.  Since then, many jurisdictions have been swayed by Justice Traynor's persuasive arguments on behalf of the strict liability rule, and have adopted it either by judicial decision or by legislative act.

Although the Supreme Court of California has since become more conservative, it continues to endorse and expand the doctrine. In 2002 it held that strict liability for defective products even applies to makers of component products that are installed into and sold as part of real property. 

Product Liability & Breach of Warranty

Warranties are statements by a manufacturer or seller concerning a product during a commercial transaction. Unlike negligence claims, which focus on the manufacturer's conduct, or strict liability claims, which focus on the condition of the product, warranty claims focus on how these issues relate to a commercial transaction. Warranty claims commonly require privity between the injured party and the manufacturer or seller. Breach of warranty based product liability claims usually focus on one of three types:

1. breach of an express warranty,
2. breach of an implied warranty of merchantability, and
3. breach of an implied warranty of fitness for a particular purpose.

Additionally, claims involving real estate may also take the form of an implied warranty of habitability. Express warranty claims focus on express statements by the manufacturer or the seller concerning the product (e.g., "This chainsaw is useful to cut turkeys"). The various implied warranties cover those expectations common to all products (e.g., that a tool is not unreasonably dangerous when used for its proper purpose), unless specifically disclaimed by the manufacturer or the seller.