Products Liability

Any time a company produces a physical product, that company takes on some risk that the product will malfunction and cause some kind of damage, leaving the company responsible under products liability law. Accordingly, every company that produces products must be fully aware of their responsibilities under products liability law. Priori can help you find a products liability lawyer with experience in your industry to discuss ways to limit your exposure as a designer, manufacturer or distributer.

What Is Products Liability?

When a consumer is given a defective product and that defect causes an injury or damage to personal property, the manufacturer can be held responsible through products liability law.  While there is no single law in the U.S. that codifies products liability, it is a well-established area of law that companies must carefully comply with. Products liability stems from the responsibility of a company to provide a product that meets the ordinary expectations of a consumer. If a product does not live up to those exceptions, such as by simply performing inconsistently or worse by becoming a danger to the user, a company can be held responsible through claims of negligence, strict liability or breach of warranty.

The scope of any products liability claim depends largely on how a product is defective. If it simply doesn’t work as expected, the consumer likely would only be able to recover their investment in the product. If it does actual damage due to safety issues, negligence comes into play, and the lawsuit will be correspondingly bigger.

Defining Defective Products

In the United States, products can be considered defective in three ways.

  • Manufacturing Defects. Sometimes a single product is made incorrectly during manufacture, causing a single product to perform beneath the standard expected. 
  • Design Defects. Sometimes there is an inherent flaw in the design or construction of all products that makes them unreasonably dangerous for the intended use. As such, a products liability case could be brought on the grounds of negligence.
  • Failure to Warn. Not all products can be totally safe in every possible situation. For this reason, all products are required to include warnings to the consumer of the risk of injury or malfunction if used inappropriately. For example, a consumer could bring a product liability case after being electrocuted using a radio in the bathroom if the packaging did not warn properly not to use the device near water. In addition, any potential risk from proper use must be clearly stated, so that consumers can reasonably choose to take on risk. For example, a chainsaw, by its nature, can never be made fully safe, so the consumer must be warned of the risks they are taking on by using it properly, as well as advised on how to minimize risks.

Who Is Liable?

If a product is determined to be defective, a consumer can sue any party in the distribution chain from the manufacturer to the distributer to the retailer. From the consumer’s perspective, any party in the distribution chain may be held liable for the defect. The defendant in the consumer’s action – or that defendant’s insurers -- can later sue others in the distribution chain to pinpoint who is ultimately liable. If the defect is due to an inherent design flaw, generally the designer or manufacturer are held ultimately responsible. Sometimes, however, a third party will be held responsible for failing to inspect a product properly. Exactly who will be held liable depends on the unique case.

Protecting Companies Against Products Liability Lawsuits

Compliance with products liability law can be challenging for companies. No matter how carefully a product is designed and tested, there is always the chance that someone may be injured using it. However, there are many ways that companies can protect themselves against products liability lawsuits. Two vital areas are described here, but a lawyer can help you develop a robust and customized risk mitigation strategy for your business.

Warnings and Instructions

One important way companies protect themselves from product liability is by including sufficient warnings and instructions. Under products liability law, a company can still be held responsible for injuries occurring while a person misuses a product if they are not sufficiently instructed as to the proper use or warned of the dangers inherent in an alternative use. Other than design defect products liability issues, failure to adequately instruct and warn is the source of some of the most costly product liability lawsuits. For this reason, it’s important for companies to carefully draft all warnings and instructions, including ones that may seem obvious, in consultation with a products liability lawyer.

Compliance with Standards

Another vital way companies protect themselves from product liability is by complying with all established standards in the field or industry. The logic is that if the product complies with established standards – both required and voluntary – it will be less likely to be considered defective, even if there is ultimately a problem. Conversely, any element of the project that does not live up to a standard, even a voluntary one, could become a deciding factor weighing against the company if an issue arises with the product. 

FAQ

How do recalls affect products liability?

If a manufacturer issues a voluntary recall, this can be used as evidence in a products liability case, but it does not automatically mean that the defendant-manufacturer is liable. Most basically, not everyone who owns a recalled product can suddenly bring a lawsuit – the plaintiff-consumer must have experienced measurable damages. Further, the consumer must prove that the particular damage or injury was caused by the defect and that it was present in their particular product. 

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